Document:

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                                                                   EXHIBIT 10.27

                         RESEARCH and LICENCE AGREEMENT

                              (1) BIOENVISION INC.

                                     - and -

                             (2) VELINDRE NHS TRUST

                                     - and -

               (3) UNIVERSITY COLLEGE CARDIFF CONSULTANTS LIMITED

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         THIS AGREEMENT is made on the 9th day of January 2001

         BETWEEN:

         (1)      VELINDRE NHS HOSPITAL TRUST a specialist cancer hospital whose
                  address is Velindre Road, Cardiff ("Velindre"); and

         (2)      UNIVERSITY COLLEGE CARDIFF CONSULTANTS LIMITED a company
                  incorporated under the laws of England and Wales (company
                  number 1477909) whose registered office is at 56 Park Place,
                  Cardiff CF11 3XR ("Cardiff"); and

         (3)      BIOENVISION, INC., a company incorporated under the laws of
                  Delaware, whose registered office is at One Rockefeller Plaza,
                  Suite 1600, New York, NY 10020 ("Bioenvision")

          WHEREAS:

         (a)      Velindre has intellectual property and know-how related to the
                  use of l-gossypol and related compounds for the treatment of
                  human and animal diseases ("Technology"); and

         (b)      Cardiff is the technology transfer company of Cardiff
                  University. Cardiff University has assisted in the early stage
                  development of the Technology; and

         (c)      Bioenvision is a company engaged in the development and
                  marketing of medical compounds.

                  The parties hereby agree to the following terms and conditions
                  for a licensing agreement for l-gossypol

         1 DEFINITIONS

         1.1 In this Agreement:

         (i)      "Velindre" means the Velindre NBS Trust.

         (ii)     "Trials Unit" means the Clinical Trials Unit at the Velindre
                  NHS Trust.

         (iii)    "Trial" means the Phase I study to be performed in cancer
                  patients at the Trials Unit.

         (iv)     "Research Period" means the period during which clinical and
                  pre-clinical studies are conducted with l-gossypol by the
                  parties to the Agreement.

         (v)      "Bioenvision" means Bioenvision and includes subsidiary
                  companies.

         (vi)     "Technology" means all aspects of the work relating to the
                  development of l-gossypol and related products.

         (vii)    "Patents" means patents applied for and patents granted
                  relating to the composition, manufacture, formulation and or
                  use of l-gossypol and related compounds.

         (viii)   "Improvement(s) means any changes or additions to the
                  intellectual property relating to l-gossypol and related
                  compounds or products which arise as a result of the Research
                  done during the Research Period and related to the Technology
                  and which shall be incorporated into existing patents or new
                  patents applied for.

         (ix)     "Product" means a medical compound or compounds developed from
                  the Technology and designated for sale as a treatment for
                  human or animal diseases.

         (x)      "Territory' means Worldwide.

         (xi)     "Results" means any and all results, data and intellectual
                  property generated by the Research and clinical studies, and
                  includes copyright, patents or applications for the same
                  (protective applications) and similar or related rights.

         (xii)    "Field" means the use of l-gossypol or related compounds for
                  the treatment of medical conditions in humans and animals.

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         1.2      Reference to any statute or statutory provision includes a
                  reference to that statute or statutory provision as from time
                  to time amended extended or reenacted.

         1.3      Words importing the singular number shall include the plural
                  and vice versa, words importing the masculine shall include
                  the feminine and neuter and vice versa, and words importing
                  persons shall include bodies corporate, unincorporated
                  associations and partnerships.

         1.4      Headings to clauses and paragraphs are for ease of reference
                  only and shall not affect the interpretation or construction
                  of this Agreement. The Schedule forms part of this Agreement
                  and shall be construed accordingly.

         2 CONDUCT OF STUDIES AND PAYMENT

         2.1      A Phase I clinical study shall be conducted at the Clinical
                  Trials Unit at Velindre. The study will be performed in cancer
                  patients and will determine the maximum tolerated dose of
                  l-gossypol, the side-effect profile and the plasma
                  concentration of the drug.

         2.2      Velindre and the Trials Unit shall use all reasonable
                  endeavours within the scope of their knowledge and experience
                  to conduct the Study in accordance with the terms of this
                  Agreement.

         2.3      Velindre will provide Bioenvision with all the scientific
                  results of the Research on a quarterly basis. A full written
                  report will reach Bioenvision no later than three (3) months
                  after the completion of the Phase I Study.

         2.4      The Study as described in Schedule 1 (see Clinical trial
                  Protocol) will be conducted on eighteen (18) patients for a
                  sum of (pound)48,454.30 exclusive of VAT. Payments by
                  Bioenvision shall be made to Velindre within thirty (30) days
                  of receipt of invoices, submitted according to the following
                  schedule:

                  Payment 1 (pound)12,000 One month prior to start of Phase I
                  trial.
                  Payment 2 (pound)12,000 four months after initial payment.
                  Payment 3 (pound)12,000 four months after payment 2.
                  Final payment upon submission of data.

         2.5      Bioenvision shall pay directly to sub-contractors for the
                  preparation, formulation and analysis of plasma concentrations
                  of l-gossypol.

         2.6      Velindre shall supply sufficient racemic gossypol for the
                  preparation of l-gossypol and shall also perform
                  pharmacokinetic analysis.

         2.7      Bioenvision shall prepare, with the assistance of Velindre,
                  the CTX for submission to the regulatory authorities.

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         2.8      If the Phase I clinical trial is completed successfully,
                  subject to Clause 4.1, Bioenvision agrees to perform further
                  clinical trials with l-gossypol or related compounds and
                  Bioenvision agrees to fund these further clinical trials with
                  l-gossypol or related compounds, subject to agreement of
                  appropriate budgets. All decisions relating to further
                  clinical development will be discussed with and approved by
                  Velindre.

         3 CONDUCT OF TRIAL

         3.1      During the course of the Trial and during the remainder of the
                  Research Period, Velindre will answer all reasonable questions
                  and queries put by Bioerivision concerning the Trial.

         3.2      At the end of the Trial period Velindre will supply
                  Bioenvision with the data and conclusions from the trial and
                  Bioenvision will provide Velindre with a written report of
                  its conclusions, including an assessment of market potential
                  within three (3) months of receiving the data.

         4 LICENSING

         4.1      Cardiff and Velindre shall grant to Bioenvision an exclusive
                  worldwide licence to make, have made, use and sell products
                  based on the Results on the basis that Bioenvision makes
                  beneficial commercial use of the Results. If, after a period
                  of three years from the grant of the licence, no commercial
                  use is made of the Results, Cardiff and Velindre shall have
                  the right to offer the licence elsewhere. Schedule 2 to this
                  Agreement sets out the basis for agreement of a licence.

         4.2      Neither Cardiff nor Velindre shall enter into discussions or
                  negotiations with any third party or third parties (other than
                  Bioenvision) with a view to the grant of a licence to any
                  third party (whether on an exclusive or non-exclusive basis)
                  under the Results for the manufacture, use and/or sale of any
                  products in the Territory.

         5 MANUFACTURE AND PRODUCT FORMULATION

         Bioenvision shall be responsible for manufacture of l-gossypol
         according to standards set down by regulatory authorities for clinical
         trials in the UK. A third party may be requested to conduct the
         manufacture and formulation of the Product.

         6 RESULTS AND IPRs

         6.1      Results shall be the property of Cardiff and Velindre.

         6.2      The necessity for and timing of any applications for Patents
                  and/or similar protective applications shall be discussed
                  between the parties. Protective applications shall be filed by
                  Bioenvision in the names of Velindre and Cardiff. Bioenvision
                  shall meet all costs incurred in prosecuting and maintaining
                  any protective applications.

         7 COMMENCEMENT

         The Trial shall commence as soon as may reasonably be practicable
         following the execution of this Agreement by the parties.

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         8 CONFIDENTIALITY

         8.1      Except as provided in sub-clause 8.4 below, during the term of
                  this Agreement all Information (howsoever recorded or stored),
                  which is disclosed by the Discloser to or otherwise comes into
                  the possession of a Recipient shall be regarded as
                  confidential and the property of the Discloser and shall not
                  be disclosed by the Recipient to third parties or used by the
                  Recipient for any purpose other than stated in this Agreement.
                  All written Confidential Information shall be marked as such
                  by the Discloser, and all such information relayed
                  electronically or verbally shall be reduced to writing within
                  thirty (30) days.

         8.2      The Recipient shall be responsible and liable to the Discloser
                  for any non-observance or breach of the terms of
                  confidentiality herein contained by its or their employees.
                  Each party shall restrict disclosure of Information to its
                  employees having a need to know such Information for the
                  purposes of the performance of their obligations and
                  responsibilities hereunder.

         8.3      The obligations governing confidentiality and/or use contained
                  in this Clause 8 shall continue for the term of this Agreement
                  and for ten (10) years thereafter.

         8.4      The provisions governing confidentiality and/or non-use
                  contained in sub-clause 8.1 above and sub-clause 8.6 below
                  shall not apply to any part of the Information which the
                  Recipient is able to demonstrate:

                  (i)      was lawfully in the Recipient's possession and known
                           to it prior to disclosure or receipt thereof; or

                  (ii)     was in the public domain or the subject of public
                           knowledge at the time of disclosure to or receipt
                           thereof by the Recipient; or

                  (iii)    becomes part of the public domain or the subject of
                           public knowledge after the date of disclosure to or
                           receipt thereof by the Recipient but through no fault
                           of the Recipient; or

                  (iv)     becomes available to the Recipient from a third
                           party not in breach of legal obligation of
                           confidentiality to any of the parties hereto in
                           respect thereof; or

                  (v)      is required to be disclosed by law or by order of any
                           court of competent jurisdiction or by order of any
                           regulatory authority.

         8.5      Cardiff and Velindre further undertake that any reports
                  produced by Bioenvision under the terms of this Agreement
                  shall not be disclosed to third parties unless agreed in
                  writing by Bioenvision.

         8.6      Results shall not be disclosed to third parties by the parties
                  hereto during the Research Period.

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         9 PUBLICATION

         Bioenvision recognizes that Cardiff and Velindre shall seek to publish
         details of the work that is the subject of this Agreement and any
         resulting patents subsequent to filing any relevant patent
         applications. Bioenvision agrees that Cardiff and Velindre shall be
         permitted to present at symposia, international, national, or regional
         professional meetings, and to publish in journals, theses,
         dissertations or otherwise of their own choosing, details of the work
         and any such patents, provided, however, that Cardiff and Velindre
         shall discuss any such publication or presentation with Bioenvision,
         and Bioenvision shall have been furnished copies of any proposed
         publication or presentation at least two (2) months in advance of the
         submission of such proposed publication or presentation to a journal,
         editor, or other third party. Bioenvision shall have two (2) months,
         after receipt of said copies, to object to such proposed presentation
         or proposed publication because there is further patentable subject
         matter which needs protection. In the event that Bioenvision makes such
         objection, said researcher(s) shall refrain from making such
         publication or presentation for a maximum of six (6) months from date
         of receipt of such objection in order for Cardiff and Velindre to file
         UK and/or other patent application(s) directed to the patentable
         subject matter contained in the proposed publication or presentation.

         10 TERM & TERMINATION

         10.1     This Agreement shall commence on the Effective Date and shall
                  (subject as otherwise provided elsewhere in this Agreement)
                  remain in force until the end of the Trial period or the end
                  of any further option period, as described in Clause 4.1
                  PROVIDED THAT any party ("the Terminating party") shall have
                  the right to terminate this Agreement by notice in writing to
                  the other parties upon the happening of any of the following
                  events:-

                  10.1.1   if any other party ("the Defaulting party") is guilty
                           of any breach nonobservance or non performance of any
                           of its obligations hereunder and does not remedy the
                           same (if capable of remedy) within thirty days of
                           written notice of such failure or breach being given
                           by the Terminating party; or

                  10.1.2   if the Defaulting party ceases to carry on business
                           or is unable to pay its debts in the ordinary course
                           of business or enters into liquidation or analogous
                           proceeding in any jurisdiction outside the United
                           Kingdom (other than for the purpose of a solvent
                           reconstruction or amalgamation) or has a receiver,
                           administrator or administrative receiver (or
                           analogous person in any jurisdiction outside the
                           United Kingdom) appointed over the whole or any part
                           of its assets; or

                  10.1.3   if; before the end of the Clinical Trial Period,
                           Bioenvision shall judge that the results of its
                           evaluation indicate that the outcome will be of no
                           commercial benefit to Bioenvision, the Agreement may
                           be terminated, subject to Bioenvision paying all
                           sums and for all uncancellable commitments to which
                           Velindre is obligated for the work.

                  10.1.4   Bioenvision shall have the right to terminate the
                           Agreement without the need to pay for the clinical
                           trials if the Phase I or the Phase II trials fail to
                           receive ethical approval.

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         10.2     Upon termination of this Agreement for whatever reason:-

                  10.2.1   (save for any claim in respect of lack of good faith
                           and/or failure to enter into negotiation as required
                           herein) no party shall have any claim against the
                           other by reason only of failure by the parties to
                           agree the terms of any licence as referred to in
                           Clause 4.

                  10.2.2   Cardiff and Velindre shall as soon as practicable
                           after termination of this Agreement either destroy or
                           return (at Bioenvision's option) all of Bioenvision's
                           Confidential Information (save for reports as defined
                           in Clause 3.2 hereof), and all copies and extracts
                           thereof in its possession and shall certify in
                           writing to Bioenvision that all such information has
                           been destroyed or returned as the case may be.

                  10.2.3   Bioenvision shall as soon as practicable after
                           termination of this Agreement either destroy or
                           return (at Cardiff and Ve1indre's option) all of
                           Cardiff and Velindre's Confidential Information (save
                           for the report as defined in Clause 2.3 hereof) and
                           all copies and extracts thereof in its possession and
                           shall certify in writing to the other parties that
                           all such information has been destroyed or returned
                           as the case may be.

         10.3     The termination of this Agreement for any reason shall be
                  without prejudice to the rights and obligations of the parties
                  thereunder accruing up to and including the date of such
                  termination. Clause 8 shall continue notwithstanding
                  termination of this Agreement.

         11 FORCE MAJEURE

         No party hereto shall be liable nor deemed to be liable to any other
         party for failure or delay in meeting any obligation hereunder due to
         strikes or lockouts (whether of their own employees or those of others)
         acts of God, warfare, flood, acts of government or governmental agency
         or any other cause beyond the control of the party which had a duty to
         perform.

         12 SEVERABILITY

         If any provision of this Agreement is found by any court or
         administrative body of competent jurisdiction to be invalid or
         unenforceable the invalidity or unenforceability of such provision
         shall not affect the other provisions of this Agreement and all
         provisions not affected by such invalidity or unenforceability shall
         remain in full force and effect unless severance of the invalid or
         unenforceable provision would reasonably frustrate the commercial
         purposes of this Agreement. The parties hereby agree to attempt to
         substitute for any invalid or unenforceable provision a valid or
         enforceable provision which achieves to the greatest extent possible
         the economic objectives of the invalid or unenforceable provision
         without itself being invalid or unenforceable.

          13 ASSIGNMENT

         This Agreement shall be binding upon and inure for the benefit of the
         successors of the parties hereto. Save as provided herein neither party
         shall have the right to assign this Agreement or any rights under it to
         any third party without the prior written consent of the other party.

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         14 WAIVER

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

         15 NOTICE

         Any notice, consent or other communication authorised or required to be
         given hereunder or for the purposes hereof may be served by any party
         on the other and shall be in writing and sent by personal
"        delivery or by recorded delivery or registered post or fax, in the case
         of personal delivery or post to the addresses of the parties set out
         above or to such other address as may have been notified by any party
         as their address for service and in the case of fax, to the following
         numbers or to such other number as may have been given by any party as
         its fax number for service:
                 Cardiff:         (0) 44 29 20874189
                 Velindre:        (0) 44 29 20694179
                 Bioenvision:     (0) 44 270 839 7570

         Any notice sent by post shall be deemed to have been served five (5)
         days after the time that the same shall have been posted. Any notice
         served by fax shall be deemed to have been served twenty-four hours
         after transmission.

         16 ENTIRE AGREEMENT

         This Agreement constitutes the entire and only Agreement between the
         parties hereto relating to the subject matter hereof and overrides and
         supersedes any prior arrangements or oral discussion between the
         parties.

         17 NO PARTNERSHIP

         Nothing in this Agreement shall create a partnership or joint venture
         between the parties hereto each of whom acts as an independent
         principal and not as the agent or partner of the other and no party
         shall have any authority to enter into any engagements or make any
         representation or warranty on behalf of or pledge the credit of or
         otherwise bind or oblige the other party hereto.

         18 ANNOUNCEMENTS

         Save as required by law or by competent regulatory authority no party
         shall make any public announcements as to the existence of this
         Agreement or as to its contents without the prior written consent of
         the other parties such consent not to be unreasonably withheld.

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         19 LAW

         This Agreement and the rights and duties of the parties hereunder shall
         be governed by and construed in accordance with English law and the
         parties hereby submit to the exclusive jurisdiction of the English
         Courts in all matters relating hereto.

         19 MISCELLANEOUS

         19.1     This Agreement may not be amended, supplemented or otherwise
                  modified except by an instrument in writing executed by all
                  parties hereto with the same formality as this Agreement is
                  executed.

         19.2     Each party hereto shall be responsible for the payment of its
                  own costs (and not those of the other party) in connection
                  with the negotiation preparation and execution hereof.

         19.3     Each party hereto represents and warrants to the other that
                  the signatories hereto for and on behalf of that party have
                  been fully empowered to execute this Agreement on its behalf
                  and that all necessary action has been taken and all
                  requisite approvals have been obtained to authorize such
                  execution.

         19.4     All sums expressed in this Agreement or otherwise payable in
                  accordance with the terms of this Agreement are expressed
                  exclusive of VAT which shall (if due) be payable in addition
                  at the applicable rate from time to time.

IN WITNESS whereof the parties hereto have executed and delivered this Agreement
as a Deed the day and year first above written.

for and on behalf of Velindre NHS Trust

Signed by  /s/
          ----------------------------------

In the presence of: /s/
--------------------------------------------

for and on behalf of Bioenvision

Signed by /s/
          ----------------------------------

in the presence of: /s/
--------------------------------------------

for and on behalf of University Collage Cardiff Consultants Limited N.B.B. in
the presence of:-

Signed by  /s/
          ----------------------------------

in the presence of:  /s/
--------------------------------------------

<PAGE>

SCHEDULE I - Heads of Terms for Licence Agreement

1.       Field                  Human and animal disease
2.       Patents/Results,       as defined in the Agreement
3.       Territory              Worldwide
4.       Licensors              UNIVERSITY COLLEGE CARDIFF CONSULTANTS LIMITED
and
                                VELINDRE NHS TRUST
5.       Licensee               BIOENVISION INC.

Licensee to be permitted to grant sub-licences at its discretion ("provided that
all sub-licences terminate automatically upon termination of the head licence")

-        Bioenvision shall ensure that sub-licencees shall abide by the terms of
         the Agreement.

-        Cardiff and Velindre to be promptly notified of any sublicence granted
         by Bioenvision

-        Licensee to use all reasonable endeavours to exploit the
         Results/patent(s)

-        Licensee to pay Licensors 25% of its net receipts arising from any
         sub-licence (net of Licensee's development costs to date and costs in
         entering into sub-licence) granted prior to completion of Phase II
         trials in cancer. Licensee to pay Licensors 15% of its net receipts
         arising from any sub-licence (net of Licensee's development costs to
         date and costs in entering into sub-licence) granted after completion
         of Phase II trials in cancer and prior to submission of an NDA or
         corresponding Product Licence application in a European country.

6.       Prosecution       -Licensee to be responsible for the prosecution and
                           maintenance of any relevant Patents at Licensee's
                           cost.

                           -Licensee to have the express right to take action
                           against infringers of any Patents and/or "passers
                           off" in the name of and with the assistance of the
                           Licensors but at the cost of Licensee; in the event
                           that Licensee recovers any damages/awards such will
                           belong to Licensee.

7.       Option            -Licensee to have "first option" over any Patent(s)
                           in the event that the Licensors wish to assign or
                           transfer such patent(s).

8.       Improvements      -Licensors to notify Licensee of any and all
                           improvements; incremental improvements to be
                           available as of right to Bioenvision at no extra
                           charge beyond existing royalty.

9.       Products          -Licensee to bear product liability risk and
                           indemnify Licensors against any third party product
                           liability claims for damage/personal injury.

                           -Licensors to indemnify Licensee against claims that
                           any patent and/or party intellectual property or
                           other rights.

<PAGE>

10.      Royalties         a rate of 2.5% on net sales of Products by
                           Bioenvision on sales up to $50m per year, Velindre
                           will receive 2% and Cardiff will receive 0.5%, this
                           will rise to 3% on those sales over $50m per year,
                           Velindre to receive 2.5% and Cardiff will receive
                           0.5%.

                           Licensors to have right of access to Licensee's
                           records to verity "net sales value".

11.      Term              Licence to continue for the lifetime of any patents
                           filed pursuant to this Agreement or for 10 years,
                           whichever is the longer. Licensee to have the right
                           to surrender its licence back to Licensors without
                           penalty at any time on not less than 3 months notice.

12.      Indemnity         Bioenvision will obtain and fund patient indemnity
                           for a fixed term (18 months) during the Phase I
                           clinical trial. Additional patient indemnity
                           insurance will be obtained and funded by Bioenvision
                           if a Phase II trial is agreed by the parties
                           according to Clause 2.6.<PAGE>

                                                                   EXHIBIT 10.28

                            CO-DEVELOPMENT AGREEMENT

                                     BETWEEN

                                   BIOENVISION

                                       AND

                                  ILEX ONCOLOGY

<PAGE>

                                TABLE OF CONTENTS

CO-DEVELOPMENT AGREEMENT ...............................................  1

WITNESSETH .............................................................  1

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

2.   CO-DEVELOPMENT PROGRAM ............................................  3

3.   CO-DEVELOPMENT FUNDING ............................................  6

4.   INCOME AND ROYALTY PAYMENTS .......................................  9

5.   SRI MILESTONE PAYMENTS ............................................ 11

6.   MARKETING ......................................................... 12

7.   SUBLICENSING ...................................................... 13

8.   PAYMENTS AND REPORTS .............................................. 14

9.   RECORDS ........................................................... 15

10.  MANUFACTURE ....................................................... 16

11.  OWNERSHIP OF THE TECHNOLOGY, TECHNICAL ............................ 16
     INFORMATION AND IMPROVEMENTS

12.  PATENT PROSECUTION ................................................ 17

13.  INFRINGEMENT BY THIRD PARTY ....................................... 17

14.  REVOCATION PROCEEDINGS ............................................ 18

15.  INFRINGEMENT OF THIRD PARTY RIGHTS ................................ 19

16.  REPRESENTATIONS ................................................... 19

17.  DISCLAIMER ........................................................ 21

18.  INDEMNIFICATION ................................................... 21

                                                                               i

<PAGE>

 19.  INSURANCE ......................................................... 23

 20.  TERM AND TERMINATION .............................................. 23

 21.  CONFIDENTIALITY; PUBLICATION; PUBLICITY ........................... 26

 22.  DISPUTE RESOLUTION ................................................ 28

 23.  ASSIGNABILITY ..................................................... 30

 24.  REFORM ............................................................ 30

 25.  WAIVER AND ALTERATION ............................................. 30

 26.  MARKING ........................................................... 31

 27.  IMPLEMENTATION .................................................... 31

 28.  GOVERNING LAW ..................................................... 31

 29.  EXPORTATION OF TECHNICAL INFORMATION .............................. 31

 30.  HEADINGS .......................................................... 31

 31.  PARTIES INDEPENDENT ............................................... 32

 32.  COUNTERPARTS ...................................................... 32

 33.  FORCE MAJEURE ..................................................... 32

 34.  SURVIVAL OF OBLIGATIONS ........................................... 32

 35.  NOTICE ............................................................ 33

      APPENDIX I - PATENTS AND PATENT APPLICATIONS ...................... 35

      APPENDIX II- CO-DEVELOPMENT AGREEMENT ............................. 36
      BETWEEN BIOENVISION AND SRI

      APPENDIX III - SLOAN-KETTERING INSTITUTE FOR
      CANCER RESEARCH AGREEMENT

                                                                              ii
<PAGE>

                            CO-DEVELOPMENT AGREEMENT

THIS AGREEMENT (the "Agreement") is entered into and effective this 12th day of
March, 2001, by and between Bioenvision, Inc. having its principal place of
business at One Rockefeller Plaza, New York, NY 10020, herein called
"Bioenvision", and Ilex Oncology, Inc. having its principal place of business at
4545 Horizon Hill Blvd, San Antonio, Texas 78229-2263, herein called "Ilex".

                                   WITNESSETH

WHEREAS, Bioenvision has commercial rights that were licensed from Southern
research Institute ("SRI") relating to the development and uses of a
2'-fluoro-2-halo substituted purine nucleoside, herein referred to as
"Clofarabine", which has been shown to be effective in vitro and in vivo against
hematologic malignancies; and

WHEREAS, Bioenvision recognizes that Ilex has expertise in the development of
new drugs for clinical use, and

WHEREAS, Bioenvision recognizes that the development program for Clofarabine
will be expedited by the expertise of Ilex, and

WHEREAS, Bioenvision has expertise and strategic relationships which may
facilitate the development and marketing of Clofarabine outside of the United
States and Canada;

NOW THEREFORE, in consideration of the mutual agreements and covenants herein
contained and intending to be legally bound thereby, the parties agree as
follows:

                                 1. DEFINITIONS

As used herein the following terms shall have the meanings set forth below:

1.1      Affiliate means any corporation, firm, partnership or other entity that
         controls, is controlled by, or is under common control with a party
         hereto. For purposes of this Agreement, "control" means the ownership,
         whether direct or indirect, of fifty (50%) percent or more of the
         equity having the power to vote or otherwise direct the affairs of the
         entity.

1.2      Bioenvision means Bioenvision, Inc. and joint ventures, subsidiaries,
         or other business entities controlled directly or indirectly by
         Bioenvision or in which Bioenvision owns at least a majority interest.

1.3      Clofarabine means 2-ch1oro-9-(2-deoxy-2-fluoro-[Beta]-D-
         arabinofuranosyl)-9H-purin-6-amine.

                                                                               1

<PAGE>

1.4      Co-Development Program means the joint clinical development of the
         Technology by Bioenvision and Ilex.

1.5      Confidential Information has the meaning set forth in Article 21.1.

1.6      Damages has the meaning set forth in Article 18.1.

1.7      Field means, and is limited to, the practice of the Patent, Invention
         and Technical Information for use in the treatment of human cancer. For
         purposes of this Agreement, "cancer" shall mean any malignant tumor
         arising from or situated in either the hematological cell lines or
         solid organs or tissues within the human body. The cancer may be
         primary or secondary in origin."

1.8      Ilex means Ilex Oncology, Inc. and joint ventures, subsidiaries, or
         other business entities controlled directly or indirectly by Ilex or in
         which Ilex owns at least a majority interest.

1.9      Improvement or Improvements means those unencumbered technology
         advances in the formulation, manufacture or structure of Clofarabine or
         any Product made by or on behalf of Management during the term of this
         Agreement that are either within the scope of and would constitute an
         infringement of the Patent claims or use Technical Information and are
         within the Field.

1.10     Indemnified Party has the meaning set forth in Article 18.3.

1.11     Indemnifying Party has the meaning set forth in Article 18.3.

1.12     Invention or Inventions means (i) applications of the Technology or
         (ii) applications necessary for use of the Technology and claimed in
         any Patent, solely in the Field.

1.13     Management means the team established pursuant to Section 2.2, which
         shall be responsible for co-ordination and supervision of the
         Co-Development Program.

1.14     Net Sales Revenue means the gross amount recognized by a party or its
         Affiliates or sublicensees for the sale of Clofarabine or other
         Product(s) through normal distribution channels (as determined by
         generally accepted accounting principles and industry practices), less
         any deductions for value added taxes incurred, and not recovered by
         such party or the equivalent, or trade discounts, or returns, or such
         deductions that may be made from the sale price in the Territory.

1.15     Patent or Patents means the patents and/or patent applications, set
         forth in Appendix I, covering the Invention or Improvement as defined
         above, patents to be issued pursuant thereto, and all divisionals,
         continuations, continuations-in-part, reissues, substitutions, and
         extensions thereof, and any patent issuing on a patent application
         filed after the Effective Date of this Agreement which is included in
         the grant of license hereunder and any foreign counterparts of the
         foregoing. Appendix I lists the owner of each such Patent.

                                                                               2

<PAGE>

1.16     Product(s) means Clofarabine . which was licensed by Bioenvision from
         SRI and as set out in the SRI Agreement (as hereinafter defined), and
         includes other related purine nucleosides within the scope of the
         patent rights licensed in the aforementioned license.

1.17     Providing Party has the meaning set forth in Article 21.1.

1.18     Representatives has the meaning set forth in Article 21.1.

1.19     Technical Information means unencumbered published or unpublished
         confidential and proprietary information in the nature of research and
         development information, knowledge and technical data, together with
         trade secrets relating to the Products, including any inventions in the
         possession of and belonging solely to Ilex or Bioenvision on or prior
         to the Effective Date of this Agreement and which Ilex or Bioenvision,
         acting in good faith, believe to be useful in carrying out the
         co-development program, including that which comes into the possession
         of Ilex or Bioenvision during the term of this Agreement as a result of
         activities carried out under this Agreement.

1.20     Technology means the patented and unpatented, patentable and
         unpatentable proprietary Technical Information related to the Products
         for use in the Field which is owned or possessed by Bioenvision with
         rights to sublicense and is made available to Ilex pursuant to this
         Agreement.

1.21     Territory means worldwide, with the exception of Japan and Southeast
         Asia (as defined in the Agreement between SRI and Bioenvision -
         Appendix II).

1.22     SRI Agreement means, collectively, the Co-Development Agreement between
         Bioenvision and SRI dated August 31, 1998 (Appendix II to this
         Agreement) and the accompanying inter-institutional agreement between
         SRI and Sloan-Kettering Institute for Cancer Research ("MSK") (Appendix
         III to this Agreement), in each case, as amended (if amended).

                            2. CO-DEVELOPMENT PROGRAM

2.1      The parties to this Agreement hereby agree to jointly co-develop
         Clofarabine for commercialization according to the terms of this
         Agreement. This Agreement supersedes all other written or verbal
         agreements, express or implied, between Ilex and Bioenvision relating
         to the subject matter hereof. Ilex shall be responsible for conducting
         all clinical trials and the filing and prosecution of all applications
         with applicable USA and Canadian regulatory authorities and all
         regulatory filings in the USA and Canada shall be in the name of Ilex.
         Ilex shall use all reasonable efforts to complete such actions and to
         obtain applicable regulatory approvals as promptly as practicable. In
         this regard, the parties contemplate attempting to obtain "orphan drug"
         status for Clofarabine but acknowledge that it may be necessary to seek
         regulatory approval on a different basis, Bioenvision shall be
         responsible for conducting all clinical trials and the filing and
         prosecution of all applications with applicable regulatory authorities
         other than in the USA and Canada and all such filings shall be in the
         name of Bioenvision.

                                                                               3

<PAGE>

2.2      Ilex shall be responsible for meeting the milestones and timetable set
         forth below:

               Milestone                       Completion Date
               ---------                       ---------------

Completion of Pivotal Phase II Trials   Ilex to use all reasonable efforts to
                                        cause such trials, as designed by
                                        Management, to be completed not later
                                        than 31 December 2002, but the parties
                                        acknowledge and agree that such trials
                                        may not be completed by such date
                                        notwithstanding Ilex's best efforts. The
                                        parties agree that if the trials are not
                                        completed by 31 December 2002, but are
                                        still ongoing and progressing to
                                        completion within a reasonable timeframe
                                        thereafter, the Milestone date shall be
                                        adjusted, accordingly.

Filing of New Drug Application with US  Not later than August 31, 2003; provided
Food and Drug Administration            that such date is consistent with the
                                        agreed upon regulatory strategy with the
                                        FDA and that the deadline shall be
                                        continued through the period ending on
                                        January 1, 2004 so long as Ilex
                                        continues to use all reasonable efforts
                                        to complete the filing in due form as
                                        promptly as reasonably practicable
                                        during such extended period. The parties
                                        acknowledge and agree that Bioenvision
                                        may agree to extend the deadline beyond
                                        January 1, 2004 upon request by Ilex,
                                        which agreement shall not be
                                        unreasonably withheld.

2.3      Management team ("Management") shall be established which will direct
         and supervise the Co-Development Program of Clofarabine or any Product
         and which will co-ordinate the marketing strategy for Clofarabine or
         any Product. The Management shall consist of four people, with two
         representatives appointed by each of Bioenvision and Ilex. Bioenvision
         and Ilex may change their respective representatives at any time.
         Additional members of Management may be added but at all times the
         equal balance of representatives from each party shall be maintained.
         The Management shall be responsible for approving the annual
         development plans for the Co-Development Program, as well as, the
         annual budget proposals and manufacturing, pre-marketing and marketing
         strategies for Clofarabine or any other Product. The Management will
         promptly share with SRI all information generated under the
         Co-Development Program pursuant to the confidentiality provisions of
         Article 21 and with particular respect to the preclinical studies and
         clinical trials. Upon commercialization of the Product(s), the
         Management will provide SRI with quarterly updates (which may be oral
         unless otherwise requested by SRI) in reasonable detail, describing the
         Management's plans, activities and accomplishments. The Management
         shall be established within thirty (30) days of signing of this
         Agreement.

                                                                               4

<PAGE>

2.4      Notwithstanding Article 2.2 above, Ilex shall have the lead (and
         controlling vote for the Management) role in designing and executing
         the Co-Development Program, including, without limitation, any
         development issue and any strategic marketing issues as described in
         Article 6, in the USA and Canada. In establishing the development
         program and marketing strategy for the USA and Canada, ILEX will give
         due regard to the effects, both positively and negatively, on
         Bioenvision' s development and/or marketing strategy for Europe.

2.5      Notwithstanding Article 2.2 above, Bioenvision shall have the lead role
         and controlling vote in designing and executing the Co-Development
         Program, including, without limitation, any development issue and any
         strategic marketing issues as described in Article 6, in all other
         territories outside the USA and Canada.

2.6      Both parties to this Agreement acknowledge the SRI Agreement. Except as
         set forth herein, the rights of either party to this Agreement are
         subject to and limited by the terms and conditions of the SRI
         Agreement.

2.7      The parties will promptly share all information generated under the
         Co-Development Program pursuant to the confidentiality provisions of
         Article 21 and including, without limitation, all information with
         respect to market analysis, competitor position, pre-clinical studies
         and clinical trials, the filing of any applications with the US Food
         and Drug Administration or similar Canadian authority and the
         manufacture and testing of different formulations and preparations of
         Clofarabine or any related Product which is the subject of this
         Co-Development Agreement.

2.8      Within ninety (90) days of the effective date of this Agreement, the
         Management shall prepare a Development Plan for Clofarabine. This plan
         shall describe the commercial strategy, clinical trial proposals and
         assessment of the market potential for Clofarabine.

                                                                               5

<PAGE>

                            3. CO-DEVELOPMENT FUNDING

3.1      Ilex shall pay all costs and expenses of any work deemed necessary for
         the development of Clofarabine or any Product in the USA and Canada,
         and this shall include, but shall not be limited to, clinical trials,
         the manufacture of bulk drug substance and finished Product, the filing
         of any applications with the US Food and Drug Administration or similar
         Canadian authority and the manufacture and testing of different
         formulations and preparations of Clofarabine or any related product
         which is the subject of this Co-Development Agreement.

3.2      Bioenvision and Ilex shall share equally in the costs and expenses of
         the development of Clofarabine or any Product in any other countries
         within the Territory other than the USA and Canada, pursuant to a
         development plan and budget which is approved by Management on an
         annual basis. Ilex's consent, via the Management, shall be required for
         any budgetary matter which is to be cofunded by Ilex, such consent not
         to be unreasonably withheld. Notwithstanding, Ilex agree to provide a
         minimum of $1 million in the first two years from the Effective Date
         for the clinical development of Clofarabine or any Product outside the
         USA and Canada. If additional money, over and above that agreed to by
         Ilex via the Management, shall be required, for whatever reason, for
         the proper development of Clofarabine or any Product outside the USA
         and Canada Bioenvision may elect to spend the additional money for such
         development and such additional money shall be credited to Bioenvision
         against future royalty payments to Ilex and at the rate of $1.5 for
         every $1 of additional expenditure.

3.3      This Agreement shall become immediately effective upon closing as
         hereinafter described. Prior to closing, Ilex and Bioenvision shall
         each deliver three originals of this Agreement, fully executed, to
         Bioenvision's counsel, Piper, Marbury, Rudnick & Wolfe LLP, at 1251
         Avenue of the Americas, 29th Floor, New York, New York 10020-1104. At
         closing, Ilex shall pay to Bioenvision the sum of US$1.35 million,
         minus US $250,000 which was previously paid by Ilex to Bioenvision upon
         signature of the Terms for a Co-Development Agreement, for a total of
         US$1.1 million to be paid by Ilex by irrevocable wire transfer of
         immediately available federal funds to an account for the benefit of
         Bioenvision, which shall be notified in writing to Ilex, where such
         funds shall be held in escrow pending completion of the closing. The
         closing shall be completed promptly upon confirmation by Bioenvision's
         counsel of receipt of such funds and delivery by such counsel of an
         original Agreement executed by each party to the other party.
         Notwithstanding anything to the contrary contained herein, this
         Agreement shall not be deemed effective until confirmation of receipt
         of such US$1.1 million in immediately available federal funds in the
         account for the benefit of Bioenvision.

                                                                               6

<PAGE>

         In addition, if the FDA agrees that the existing Clofarabine Toxicology
         package contained in the Investigators IND, filed by the University of
         Texas MD Anderson Cancer Center, is sufficient for Ilex's NDA, and Ilex
         will not be required to do additional cGMP animal toxicity studies to
         continue or complete the clinical trials, then Ilex shall promptly pay
         via wire transfer to Bioenvision an additional $150,000. Otherwise,
         Ilex shall use the $150,000 to defer its costs for the required
         additional toxicology studies on an as-costs-are-incurred basis, and
         refund to Bioenvision any remainder of the $150,000 once all toxicology
         studies are fully paid for.

3.4      Ilex agrees to pay Bioenvision an additional sum of US$2.5 million by
         irrevocable wire transfer of immediately available federal funds
         immediately after completion of the Management designed pivotal Phase
         II clinical trial of Clofarabine. Completion, for this purpose, shall
         mean the date on which all patients will have finished treatment as
         defined in the protocol for the Phase II clinical trial.

3.5      Ilex is hereby granted an option to purchase US$1 million of
         Bioenvision common stock at the Market Value per each such share. Such
         option shall become exercisable upon completion of the Phase II
         clinical trial referred to in Article 3.4 and shall also expire 30 days
         after completion of the Phase II trial referred to in Article 3.4. The
         Market Value per each share of Bioenvision common stock shall equal the
         average of the Market Price per each such share for on each of the 10
         Trading Days immediately prior to the date of exercise of the option.
         "Market Price" means, with respect to the shares of common stock of
         Bioenvision on any applicable Trading Day, (a) if the shares are listed
         or admitted for trading on any national securities exchange or included
         in the NASDAQ National Market or NASDAQ SmallCap Market, the last
         reported sales price as reported on such exchange or market; (b) if the
         shares are not listed or admitted for trading on any national
         securities exchange or included in the NASDAQ National Market or NASDAQ
         SmallCap Market, the average of the last reported closing bid and asked
         quotation for the shares as reported on the National Association of
         Securities Dealers Automated Quotation System ("NASDAQ") or a similar
         service if NASDAQ is not reporting such information; (c) if the shares
         are not listed or admitted for trading on any national securities
         exchange or included in the NASDAQ National Market or NASDAQ SmallCap
         Market or quoted by NASDAQ or a similar service, the average of the
         last reported bid and asked quotation for the shares as quoted by a
         market maker in the shares (or if there is more than one market maker,
         the bid and asked quotation shall be obtained from two market makers
         and the average of the lowest bid and highest asked quotation). In the
         absence of any available public quotations for the Common Stock, the
         Board of Directors of Bioenvision shall determine in good faith the
         Market Price of the common stock, which determination shall be set
         forth in a certificate by the Secretary of the Company. "Trading Day"
         means any day on which the common stock of Bioenvision is quoted for
         trading on any national securities exchange, The NASDAQ National
         Market, the NASDAQ SmallCap Market, the NASDAQ or a similar service, or
         by a market maker in the "pink sheets" or a similar service or, if the
         common stock is not customarily quoted for trading in any of those
         venues (excluding weekends and holidays and similar customary days on
         which such trading does not occur), then any day other than a Saturday,
         Sunday, or other day on which commercial banks in the State of New York
         are authorized or required by law to close. In exercising the option
         Ilex shall not make use of material non-public information and shall
         comply with applicable law. This option shall be non-transferable.

                                                                               7

<PAGE>

3.6      Ilex agrees to pay to Bioenvision the sum of US$5,000,000by irrevocable
         wire transfer of immediately available federal funds within five (5)
         days after submission by Ilex of a new drug application ("NDA") with
         the United States Food and Drug Administration ("FDA") for the use of
         Clofarabine or other Product in the treatment of chronic lymphocytic
         leukemia ("CLL"). If an NDA is filed for the use of Clofarabine or
         other Product in the treatment of an acute leukemia prior to the
         submission for the treatment of chronic leukemia Ilex shall pay to
         Bioenvision the sum of $500,000. The sum of $4,500,000 shall then be
         paid upon submission of the NDA for the use of Clofarabine or other
         Product to treat chronic leukemia. If Ilex fails to submit the NDA for
         the use of Clofarabine or other Product for chronic leukemia, lymphoma
         or solid tumors within twelve (12) months of submitting the NDA for
         acute leukemia the payment to Bioenvision of the $4,500,000 shall be
         made, If Ilex fails to file the NDA for chronic leukemia or solid
         tumors then Bioenvision shall have the right to make such a filing.

3.7      Ilex is hereby granted an option to purchase an additional $2,000,000
         of Bioenvision common stock at the Market Value per each such share.
         Such option shall become exercisable upon filing an NDA in the USA or
         Canada referred to in Article 3.6 and shall expire 30 days after
         submitting the NDA referred to in Article 3.6. The Market Value shall
         be determined, as of the applicable exercise date pursuant to this
         Article 3.7, in accordance with the procedures for determination of
         Market Value set forth in Article 3.5 above. In exercising the option
         Ilex shall not make use of material non-public information and shall
         comply with applicable law. This option shall be non-transferable.

3.8      Ilex agrees to pay all costs and expenses of prosecuting, filing and
         maintaining Patents and defending revocation proceedings on Patents and
         Patent applications on Clofarabine or any Product or Improvement within
         the USA and Canada.

3.9      Bioenvision agrees to pay all costs and expenses of prosecuting, filing
         and maintaining Patents and defending revocation proceedings on Patents
         and Patent applications on Clofarabine or any Product or Improvement in
         all other countries within the Territory other than the USA and Canada.

                                                                               8

<PAGE>

                         4. INCOME AND ROYALTY PAYMENTS

4.1      If Ilex and Bioenvision separately market Clofarabine or any Product
         for sale for use in the Field in the same area within the Territory
         then the terms of the separate agreements shall apply as if Ilex and
         Bioenvision were marketing Clofarabine or any Product for sale for use
         in the Field in different areas within the Territory.

4.2      If Ilex and Bioenvision shall combine to market Clofarabine or any
         Product for sale for use in the Field in any area within the Territory
         a royalty of 7% shall be paid to SRI and the sales shall be considered
         as a sale by Ilex for calculation of the milestone payments referred to
         in Articles 5.1 and 5.2.

4.3      Ilex will pay total royalties to Bioenvision for all direct sales of
         Clofarabine or any Product by Ilex, its Affiliates and Sublicensees,
         for use in the Field within the Territory according to the following
         schedule and to the provisions of Article 4.8:

           Annual Net Sales        Nominal Royal         Total Royalty
         Revenue ($Million)    (% Net Sales Revenue) (% Net Sales Revenue)
         -----------------      -------------------   -------------------
               0- 30                     7                   8.75
         greater than 30-100             9                  11.25
         greater than 100-200           10                  12.50
         greater than 200--500          12                  15.00
                500+                    15                  18.75

4.4      In countries where Bioenvision has made direct sales of Clofarabine or
         any Product for use in the Field within the Territory, Bioenvision
         shall pay net royalties to Ilex according to the following schedule and
         the provisions of Article 4.8:

           Annual Net Sales        Nominal Royal          Net Royalty
         Revenue ($Million)    (% Net Sales Revenue) (% Net Sales Revenue)
         -----------------      -------------------   -------------------
               0- 30                      7                  3.5
         greater than 30-100              9                  5.5
         greater than 100-200            10                  6.5
         greater than 200--500           12                  8.5
                500+                     15                 11.5

4.5      In any country within the Territory where Clofarabine or any Product is
         sold by a third party, such as a distributor, wholesaler, or marketing
         company, for use in the Field any payments made by the third party as
         part of the acquisition of rights to sell or distribute Clofarabine or
         any Product, (as distinct from payments for Products sold or the
         payments with respect to which royalties are incurred under this
         Agreement or the SRI Agreement), shall be shared equally between Ilex,
         SRI and Bioenvision.

                                                                               9

<PAGE>

4.6      If the rights to market Clofarabine or any Product for use in the field
         are acquired by a third party in any country within the Territory any
         payment made by the third party as part of the acquisition of rights to
         sell Clofarabine or any Product (other than royalty payments for Net
         Sales Revenue) shall either (i) be divided equally between Ilex, SRI
         and Bioenvision, in which case SRI shall have no reserve rights to
         receive royalty payments or other payments, or (ii) be divided between
         the parties in the ratio Ilex 37.5%:Bioenvision 37.5%: SRI 25%, in
         which case SRI shall reserve the right to receive royalty payments and
         other payments, the terms of such payments to be negotiated in good
         faith by the parties.

4.7      If the rights to manufacture Clofarabine or any Product for use in the
         Field are assigned to a third party in any country within the
         Territory, all payments received from such third party as part of the
         acquisition of rights to manufacture Clofarabine or any Product shall
         be distributed by Bioenvision equally between Bioenvision, Ilex, and
         SRI.

4.8      Except as provided under this Agreement, all payments due under this
         Article 4 shall take account of royalties due under the SRI Agreement
         and such payments shall be shared equally between Ilex and Bioenvision.
         In particular, any royalties to be paid by Ilex or any Ilex sublicensee
         shall be considered for the purposes of this Agreement to be royalties
         under the terms of an acquisition as defined in Article 5A of the
         Co-Development Agreement between SRI and Bioenvision, which terms may
         be subject to amendment by SRI and Bioenvision, and under any such
         amendment Bioenvision shall pay to SRI not less than one-half (1/2) of
         the royalties received from Ilex. This shall mean that if
         royalty-bearing sales are made pursuant to Article 4.3 hereof, then for
         the share of royalty payments received by Bioenvision from Ilex that
         Bioenvision must pay to SRI, as part of the SRI Agreement, Ilex shall
         contribute 25% of the total amount due. For example, if Bioenvision
         shall receive $100 in royalty from Ilex (sometimes hereinafter referred
         to as "Nominal Royalty") it shall be required to pay SRI not less than
         the sum of $50 of which Ilex shall contribute one-half of $50, or in
         this example $25. This shall mean that in this example Ilex will pay
         $125 (sometimes hereinafter referred to as "Total Royalty") to
         Bioenvision. This Article shall further mean that if Bioenvision makes
         sales pursuant to Article 4.4, then all royalty payments owed by
         Bioenvision to SRI shall be paid as set out in the SRI Agreement, but
         that Ilex shall contribute one-half of the royalty payments. For
         example of every $100 of Net Sales Revenue made by Bioenvision, $7
         shall be paid as royalty to SRI. In this example, on annual net sales
         revenue up to $30 million, $7 of every $100 of Net Sales Revenue would
         be due as nominal royalty to Ilex, but $3.50 of that amount would be
         used as Ilex's contribution to the royalty paid to SRI, and only the
         remaining $3.5 would be due and paid to Ilex.

                                                                              10

<PAGE>

4.9      It is agreed among the Parties that performance by Ilex of its
         commitment to pay milestone payments to SRI as set forth below in
         Article 5 shall eliminate any requirement by Ilex to share in any
         payment which Bioenvision may otherwise make to SRI for profit sharing
         under the SRI Agreement.

                            5. SRI Milestone Payments

5.1      As partial consideration for SRI agreeing to the other terms and
         conditions set forth herein, Ilex shall pay directly to SRI, pursuant
         to payment instructions provided in Article 5.4 herein, the following
         milestone payments, based solely on the Net Sales Revenue by Ilex, its
         Affiliates and/or any Ilex sublicensees (excluding direct sales by
         Bioenvision or its Affiliates and any Bioenvision sublicensee other
         than Ilex) of Clofarabine or other Product during the Term of this
         Agreement. In each case, the payment shall be made within forty-five
         (45) days after milestone achievement with Ilex informing SRI in
         writing within the first thirty (30) days of milestone achievement that
         the milestone in question has been achieved.

         The milestone payments shall be as follows:

         a)   The earlier of the first calendar year when (i) Ilex obtains
              $30,000,000 in annual Net Sales Revenue or (ii) Ilex achieves
              $150,000,000 in total cumulative Net Sales Revenue, Ilex shall
              make a payment of $1,000,000;

         b)   The earlier of the first calendar year when (i) Ilex obtains
              $40,000,000 in annual Net Sales Revenue or (ii) Ilex achieves
              $200,000,000 in total cumulative Net Sales Revenue, Ilex shall
              make a payment of $1,000,000;

         c)   The earlier of the first calendar year when (i) Ilex obtains
              $50,000,000 in annual Net Sales Revenue or (ii) Ilex achieves
              $250,000,000 in total cumulative Net Sales Revenue, Ilex shall
              make a payment of $3,000,000;

         d)   The earlier of the first calendar year when (i) Ilex obtains
              $100,000,000 in annual Net Sales Revenue or (ii) Ilex achieves
              $500,000,000 in total cumulative Net Sales Revenue, Ilex shall
              make a payment of $20,000,000;

         e)   The earlier of the first calendar year when (i) Ilex obtains
              $200,000,000 in annual Net Sales Revenue or (ii) Ilex achieves
              $1,000,000,000 in total cumulative Net Sales Revenue, Ilex shall
              make a payment of $40,000,000;

         f)   The earlier of the first calendar year when (i) Ilex obtains
              $500,000,000 in annual Net Sales Revenue or (ii) Ilex achieves
              $2,500,000,000 in total cumulative Net Sales Revenue, Ilex shall
              make a payment of $40,000,000.

                                                                              11

<PAGE>

5.2      In addition, Ilex shall also pay directly to SRI, a milestone payment
         of $10,000,000, pursuant to payment instructions provided in Article
         5.4 herein, upon receipt by Ilex of the First FDA approval in the
         United States to market Clofarabine or other Product for the treatment
         of any of the following types of cancer: breast cancer, colon cancer,
         non-small cell lung cancer or prostate cancer. The payment shall be
         made within forty-five (45) days after milestone achievement with Ilex
         informing SRI in writing within the first thirty (30) days that the
         milestone has been achieved. It is hereby agreed that it is the
         intention of Ilex to investigate the clinical efficacy of Clofarabine
         or any Product for the treatment of the cancers referred to in this
         Article.

5.3      All payments to SRI due under this Agreement shall be made by
         electronic transfer of funds in U.S. dollars to:

         AmSouth Bank
         Account No. 01389483
         Routing No. 062000019
         For Intellectual Property

                                  6. MARKETING

6.1      The rights and entitlements to market Clofarabine granted to
         Bioenvision by the SRI Agreement shall remain the exclusive property of
         Bioenvision until the completion of the Co-Development Program. The
         completion of the program shall mean the filing of a product license in
         the USA. Upon completion of the Co-Development Program in the USA and
         Canada, Ilex shall have the controlling vote in any Management
         determination to transfer marketing rights for Clofarabine or any
         Product in the USA and Canada, and if required by the Management,
         Bioenvision, in accordance with the terms of this Agreement and the SRI
         Agreement, shall grant an exclusive license to Ilex to market and sell
         Clofarabine or any such Product in the Field in these countries
         including the right to sublicense the same, as described in Article 7.1
         The exclusive license grant by Bioenvision shall include exclusive
         rights in the USA and Canada to manufacture, have manufactured, use,
         market and sell Clofarabine or any product in the Field under Patents
         and Technology, subject to continued payment of royalties and milestone
         amounts as provided in this Agreement and to other customary license
         terms and conditions, such as compliance with FDA good manufacturing
         procedures and applicable marketing and sales regulations. This
         exclusive license shall remain in full force and effect so long as Ilex
         performs its obligations as set forth herein, and Bioenvision will
         execute such documents as may be requested by Ilex to attest to the
         transfer to Ilex of such license rights. No sublicense shall be granted
         hereunder and no right shall be implied to Ilex if Ilex breaches its
         obligations under this Agreement. No license grant by Bioenvision
         covering rights in the USA and Canada shall restrict Bioenvision's
         rights and entitlements outside the USA and Canada.

                                                                              12
<PAGE>

6.2      Upon every exclusive license granted by Bioenvision, Ilex shall grant a
         corresponding exclusive license to Bioenvision with respect to
         Improvements, on substantially the same terms and conditions,
         consistent with this Agreement except the exclusive right shall pertain
         to areas outside the USA and Canada.

                                 7. SUBLICENSING

7.1      The exclusive license granted to Ilex in Article 6.1 shall include the
         right by Ilex to sublicense the marketing and sale of Clofarabine or
         any Product directly to any Ilex sublicensee ("Sublicensee") in the
         Field for the USA and Canada, provided such sublicense is in accordance
         with this Article 7 and is consistent with the rights of Bioenvision as
         licensor under the license to be granted to Ilex pursuant to Article
         6.1.

7.2      Ilex will keep Bioenvision routinely updated on progress of discussions
         and negotiations with potential sublicensees. The parties agree that
         sublicense agreements shall conform in all material respects to the
         terms and conditions of this Agreement and that such sublicense
         agreements shall not contravene or in any way negate the original
         license Agreement between Bioenvision and SRI. In no event shall Ilex
         grant to its sublicensees any rights of Bioenvision not conveyed by
         this Agreement. Any such purported sublicense not in strict conformance
         with this Agreement shall be null and void.

7.3      If this Agreement is terminated for any reason, any sublicense granted
         by Ilex hereunder shall automatically transfer to Bioenvision. Ilex
         shall execute such documents as may be requested by Bioenvision to
         effect the transfer to Bioenvision of such sublicense and all of the
         rights of Ilex thereunder including, but not limited to, the right to
         receive any payments due under such sublicense.

7.4      If all or part of any rights granted to Ilex by this Agreement are
         acquired, directly or indirectly, by a third party from Ilex whether by
         sublicense or otherwise, all current or future payments derived by Ilex
         from the transfer, whether in cash, shares, property or any other form
         of payment, including but not limited to up-front payments, and
         milestone payments will be divided according to the terms of Article
         4.6 and the other applicable terms and conditions of this Agreement
         shall apply to such payments and to the other terms and conditions of
         such arrangement. For purposes of royalty payment only, sales of Ilex
         Sublicensees shall be considered to be sales by Ilex.

                                                                              13

<PAGE>

                             8. PAYMENTS AND REPORTS

8.1      All payments owed to Bioenvision by Ilex shall be paid within fifteen
         (15) days after the end of the month in which the payments are received
         by Ilex except as stated otherwise elsewhere in this Agreement and
         except for royalties as a result of direct marketing of a Product by
         Ilex.

8.2      Royalties owed to Bioenvision as a consequence of direct marketing of a
         Product by Ilex, shall be due for each calendar quarter beginning with
         the first calendar quarter in which sales occur and shall be paid to
         Bioenvision within fifteen (15) days following the last day of the
         applicable calendar quarter.

8.3      All payments owed to Ilex by Bioenvision shall be paid within fifteen
         (15) days after the end of the month in which the payments are received
         by Bioenvision except as stated otherwise elsewhere in this Agreement
         and except for royalties as a result of direct marketing of a Product
         by Bioenvision.

8.4      Royalties and profit-sharing compensation owed to Ilex as a consequence
         of direct marketing of a Product by Bioenvision shall be due for each
         calendar quarter beginning with the first calendar quarter in which
         sales occur and shall be paid to Ilex within fifteen (15) days
         following the last day of the applicable calendar quarter.

8.5      Unless otherwise specified under this Agreement, all payments by one
         party to this Agreement to another party to this Agreement shall be
         made in immediately available funds in U.S. dollars by wire transfer
         and delivered to the applicable address of the payee specified in
         Article 34 or an address designated in writing by the applicable payee
         party from time to time.

8.6      With respect to payments with regard to any non-dollar denominated
         amounts, such amounts shall be deemed to have been converted into U.S.
         Dollars at the conversion rate(s) published in The Wall Street Journal
         (Eastern Edition) as of the last day of the applicable period (quarter
         or month or such other period as may be applicable) for which such
         payment is due, and payment shall be made by the applicable payor party
         to this Agreement in U.S. Dollars of the amount due under this
         Agreement in respect of such amount.

8.7      Notwithstanding anything to the contrary contained in this Agreement,
         in the event that either party is prevented from making any payment
         under this Agreement by virtue of restrictions on currency conversion
         or repatriation under the statutes, laws, codes or governmental
         regulations of the country from which the payment is to be made, then
         such payments may be paid by depositing them in the currency in which
         accrued to the account of the party concerned in a bank acceptable to
         that party in the country whose currency is involved.

                                                                              14
<PAGE>

8.8      Payments to either party hereunder shall be deemed paid as of the day
         on which they are received at the address of the payee party designated
         pursuant to Article 34. Any part of a payment which is not paid on or
         before the date when due shall accrue interest thereon from such date
         until the date of its payment in full at two (2) percentage points over
         the per annum interest rate published from time to time as the "Prime
         Rate" in The Wall Street Journal (Eastern Edition), but in no event
         shall such rate exceed the maximum rate permitted by applicable law.

8.9      All foreign taxes, assessments and fees of any nature levied or
         incurred on account of any payments accruing under this Agreement will
         be assumed and paid by the party owing the payments and not deducted
         from payments owed to the other party.

8.l0     If Ilex shall market Clofarabine or any Product in the USA and Canada
         under the exclusive license granted in Article 6.1 hereof, Ilex shall
         deliver to Bioenvision within forty-five (45) days after the end of
         each calendar quarter a report, certified by the chief financial
         officer (or equivalent) of Ilex, setting forth in reasonable detail the
         calculation of payments made or received by Ilex during the quarter and
         for each calendar quarter, including gross sales, net sales, value
         added taxes, number of units sold, unit price, royalties by net sales
         range and the like on a country-by-country basis by Ilex, Sublicensees,
         joint ventures and their Affiliates.

8.11     If Bioenvision shall market Clofarabine or any Product in the countries
         within the Territory other than the USA and Canada, Bioenvision shall
         deliver to Ilex within forty-five (45) days after the end of each
         calendar quarter a report, certified by the chief financial officer (or
         equivalent) of Bioenvision, setting forth in reasonable detail the
         calculation of payments made or received by Bioenvision during the
         quarter and for each calendar quarter, including gross sales, net
         sales, value added taxes, number of units sold, unit price, royalties
         by net sales range and the like on a country-by-country basis by
         Bioenvision, Sublicensees, joint ventures and their Affiliates.

8.12     All payments by Ilex under this Agreement shall be made in U.S. dollars
         unless the parties otherwise agree.

                                   9. RECORDS

9.1      Bioenvision shall maintain accurate records of all of its operations
         affecting payments hereunder, and shall permit Ilex or its duly
         authorized agent to make a reasonable number of reasonable inspections
         (no more than once, annually) of all such records and to make copies of
         or extracts from such records during regular business hours but without
         disruption of business activities throughout the term of this Agreement
         and for a period of three (3) years thereafter. All such inspections
         and copying shall be subject to mutually acceptable agreements to
         maintain the confidentiality and restrict the use of such information.
         The fees charged for an Ilex authorized audit shall be paid by Ilex;
         provided, however, that if an audit discloses an underpayment by
         Bioenvision of more than five percent (5%) for such audited period,
         Bioenvision shall pay the reasonable fees and expenses charged by the
         firm conducting the audit.

                                                                              15
<PAGE>

9.2      Ilex shall maintain accurate records of all of its operations affecting
         payments hereunder, and shall permit Bioenvision or its duly authorized
         agent to make a reasonable number of reasonable inspections (no more
         than once, annually) of all such records and to make copies of or
         extracts from such records during regular business hours but without
         disruption of business activities throughout the term of this Agreement
         and for a period of three (3) years thereafter. All such inspections
         and copying shall be subject to mutually acceptable agreements to
         maintain the confidentiality and restrict the use of such information.
         The fees charged for a Bioenvision authorized audit shall be paid by
         Bioenvision; provided, however, that if an audit discloses an
         underpayment by Ilex of more than five percent (5%) for such audited
         period, Ilex shall pay the reasonable fees and expenses charged by the
         firm conducting the audit.

                                 10. MANUFACTURE

10.1     If Ilex is granted an exclusive license to manufacture Clofarabine or
         any Product in the USA and Canada under Article 6.1 of this Agreement,
         this exclusive license shall in no way limit Bioenvision from
         manufacturing Clofarabine outside the USA and Canada. Both parties
         shall exchange information that may be useful for the manufacture of
         the Product.

10.2     If Ilex shall grant a sublicense of the rights within the USA and
         Canada in accordance with the terms of this Agreement, such sublicense
         may include the rights to manufacture the Product in the relevant
         country.

                   11. OWNERSHIP OF THE TECHNOLOGY, TECHNICAL
                          INFORMATION AND IMPROVEMENTS

11.1     Ilex and Bioenvision shall each retain full ownership of their existing
         intellectual property rights including rights in the process of being
         protected and rights conceived but not yet reduced to practice as of
         the Effective Date. To the extent existing intellectual property rights
         of Bioenvision fall within the definitions of Patents, Technology,
         Technical Information and Improvements, as set forth in this Agreement,
         such rights shall be included in any license or other operating rights
         granted to Ilex under the Terms hereof. Ilex agrees not to directly or
         indirectly contest any of Bioenvision's intellectual property rights
         licensed to Ilex hereunder and to use all commercially reasonable
         efforts to support Bioenvision in that regard against any adverse third
         party claim.

                                                                              16
<PAGE>

11.2     All Improvements developed under projects funded, in whole or in part,
         by this Agreement shall be owned by the Party or Parties who fund the
         project, in question, and shall be included in the licenses or transfer
         of rights contemplated by this Agreement. In the event that a
         conflicting obligation prevents SRI from including such an Improvement,
         Bioenvision shall use reasonable efforts to assist Ilex to obtain
         rights from the appropriate third party or parties. If the party that
         owns an improvement elects not to pursue patent coverage for that
         improvement then either of the other parties may file in the name of
         all parties.

                             12. PATENT PROSECUTION

12.1     Ilex shall bear all expenses related to the filing, prosecution or
         maintenance of all Patents, and Improvements relating to the Product in
         whole or in part in the USA and Canada as provided in Article 3.8
         hereto. Bioenvision shall provide Ilex with a detailed summary of such
         costs as incurred by Bioenvision and/or SRI. Outside of the USA and
         Canada, such patent filing, prosecution and maintenance costs shall be
         shared 50/50 in those territories and countries where Bioenvision and
         Ilex co-market Clofarabine or any other Product, and paid solely by
         Bioenvision in countries or territories where Bioenvision or another
         Bioenvision sublicensee is marketing Clofarabine or any other Product.

12.2     Bioenvision shall promptly furnish to Ilex copies of all documents
         received by Bioenvision relating to the filing of future patents
         relating to the Patents or any Improvements.

12.3     Bioenvision shall provide Ilex with draft copies of all correspondence
         and filings and related prosecution documents received by it on the
         Patents and Improvements relating to the Product and Ilex shall
         promptly provide comments, if any, to Bioenvision. Bioenvision shall
         confer with Ilex regarding prosecution tactics and strategy.
         Bioenvision shall have the right to take such actions as are reasonably
         necessary, in its good faith judgement, to preserve all rights under
         the Patents and Improvements owned by, or licensed exclusively to
         Bioenvision under the SRI agreement throughout the Territory. As soon
         as practical, subsequent to the filing of any prosecution document,
         Bioenvision shall provide Ilex with a copy of such document. In
         addition, Bioenvision shall copy Ilex with any official office action
         and Bioenvision responses and submissions.

                         13. INFRINGEMENT BY THIRD PARTY

13.1     Either party shall notify the other party of any suspected infringement
         by a third party of a Patent in the Field and the Territory, and each
         party shall inform the other of any evidence of such infringement(s).

                                                                              17
<PAGE>

13.2     Bioenvision shall have the first right to institute suit for
         infringement(s) in the Field and Territory. At Bioenvision's expense,
         Ilex will reasonably assist Bioenvision in such prosecutions if so
         requested by Bioenvision, and will lend its name to such actions if
         requested by Bioenvision or required by law to prosecute, defend or
         maintain any such action. Notwithstanding the foregoing, Ilex shall
         have the right to participate and be represented in any such
         prosecutions by its own counsel at its own expense.

13.3     If Ilex notifies Bioenvision of its desire to institute suit for
         infringement(s) and Bioenvision fails to exercise its first right to do
         so within ninety (90) days of such notice, then Ilex may, at its own
         expense, bring suit or take any other appropriate action. At Ilex's
         expense, Bioenvision will reasonably assist Ilex in such prosecutions
         if so requested by Ilex, and will lend its name to such actions if
         requested by Ilex or required by law to prosecute, defend or maintain
         any such action. Notwithstanding the foregoing, Bioenvision shall have
         the right to participate and be represented in any such prosecutions by
         its own counsel at its own expense.

13.4     No settlement of any suspected infringement(s), whether or not a suit
         has been instituted, may be entered into without the express written
         consent of Bioenvision and Ilex.

13.5     Any amounts recovered pursuant to an infringement suit, settlement or
         otherwise shall be retained by and be the property of the party
         bringing the action. In the event Bioenvision receives any monies or
         other consideration from a third party as a result of Bioenvision's
         exercise of its rights under Article 13 of this Agreement, Bioenvision
         shall first be reimbursed for expenses incurred and paid for, Ilex
         shall then receive a portion of the remainder in accordance with the
         applicable provision(s) of Article 4 as applied to all such monies or
         other considerations whether such monies or other considerations are
         denoted as "royalties," "damages," "releases" from prior acts, or any
         other designation.

                           14. REVOCATION PROCEEDINGS

14.1     In the event either party becomes aware of the institution by a third
         party of any proceedings for the revocation of any Patents or
         Improvements in any country in the Territory, such party shall promptly
         notify the other party. Bioenvision shall defend any such proceedings
         at its own expense, in its own name.

14.2     Ilex shall have the right to participate in such revocation proceedings
         in the USA and Canada at Ilex's expense, and Bioenvision will lend its
         name to such proceedings if requested by Ilex or required by law to
         prosecute, defend or maintain any such action. Sublicensees of Ilex,
         which were granted in accordance with the terms of this Agreement,
         shall also have the right to participate in such revocation proceedings
         at their own cost.

                                                                              18
<PAGE>

14.3     Settlement of any revocation proceedings shall be subject to the
         approval of Bioenvision; such approval shall not be unreasonably
         withheld.

                   15.  INFRINGEMENT OF THIRD PARTY RIGHTS

15.1     Bioenvision "does not warrant" as stated in Article 17. Disclaimer,
         "that the patents will be free from claims of infringement by third
         parties or any other rights of third parties."

15.2     Bioenvision as stipulated in Article 18. Indemnification, "agrees to
         indemnify, hold harmless and defend Ilex... from and against any and
         all demands, claims, suits, and actions ..." which includes
         infringement of third party rights.

15.3     Ilex will reasonably assist Bioenvision to defend or settle such third
         party claim if so requested and shall do so at its own cost.

15.4     Ilex shall have the right to participate and be represented in any such
         claim by a third party by its own counsel at its cost.

15.5     No settlement of any third party claim may be entered into without the
         express written consent of Bioenvision.

15.6     In the event, by way of counterclaim or otherwise, either party or both
         parties recover any damages or other sums in any action, suit, or
         proceeding involving a claim by a third party, or in settlement
         thereof, such recovery shall be applied and shared as mutually agreed.

                               16. REPRESENTATIONS

16.1     This Agreement is entered into by Bioenvision in its corporate
         capacity. It is understood and agreed that the U.S. Government is not a
         party to this Agreement and in no manner whatsoever shall be liable for
         or assume any responsibility or obligation for any claim, cost, or
         damages arising out of or resulting from this Agreement or the subject
         matter licensed.

16.2     Bioenvision warrants to Ilex and its Affiliates and their respective
         officers, directors, employees, other agents, representatives and
         assigns that:

         1.       Bioenvision is a corporation duly incorporated and validly
                  existing and (to the extent applicable) in good standing under
                  the laws of Delaware, with the corporate power to own, lease
                  and operate its properties and to carry on its business as now
                  conducted.

                                                                              19

<PAGE>

         2.       Bioenvision has all necessary corporate power and authority to
                  enter into this Agreement and to consummate the transactions
                  contemplated hereby and to perform its obligations under this
                  Agreement.

         3.       The execution, delivery and performance of this Agreement by
                  Bioenvision does not conflict with or contravene the
                  certificate of incorporation or by-laws, regulations or
                  partnership agreement (or other comparable governing
                  instruments with different names) of Bioenvision, nor will the
                  execution, delivery or performance of this Agreement conflict
                  with or result in a breach of, or entitle any party thereto to
                  terminate, any material agreement or instrument to which
                  Bioenvision is a party, or by which any of its assets or
                  properties is bound.

         4.       This Agreement has been duly authorized, executed and
                  delivered by Bioenvision and upon execution and delivery by
                  Ilex constitutes a legal, valid and binding agreement of
                  Bioenvision, enforceable against Bioenvision in accordance
                  with its terms, except as enforceability may be limited by
                  bankruptcy, insolvency, moratorium, reorganization or other
                  similar laws affecting creditors' rights generally.

16.3     Ilex hereby represents and warrants to Bioenvision and its Affiliates
         and their respective officers, directors, employees, other agents,
         representatives and assigns that:

         1.       Ilex is a corporation duly incorporated and validly existing
                  as a corporation and (to the extent applicable) in good
                  standing under the laws of Delaware with the corporate power
                  to own, lease and operate its properties and to carry on its
                  business as now conducted.

         2.       Ilex has all necessary corporate power and authority to enter
                  into this Agreement and to consummate the transactions
                  contemplated hereby and to perform its obligations under this
                  Agreement.

         3.       The execution, delivery and performance of this Agreement by
                  Ilex does not conflict with or contravene its articles or
                  certificate of incorporation or by-laws, regulations or
                  partnership agreement (or other comparable governing
                  instruments with different names), nor will the execution,
                  delivery or performance of this Agreement conflict with or
                  result in a breach of, or entitles any party thereto to
                  terminate, any material agreement or instrument to which Ilex
                  is a party, or by which any of its assets or properties is
                  bound.

         4.       This Agreement has been duly authorized, executed and
                  delivered by Ilex and upon execution and delivery by
                  Bioenvision and constitutes a legal, valid and binding
                  agreement of Ilex, enforceable against Ilex in accordance with
                  its terms, except as enforceability may be limited by
                  bankruptcy, insolvency, moratorium, reorganization or other
                  similar laws affecting creditors' rights generally.

                                                                              20

<PAGE>

16.4     Bioenvision represents that it has the unencumbered right to grant all
         of the rights granted herein.

16.5     Bioenvision is unaware of any claims by any third parties with respect
         to Patent infringement or any other type of liability relevant to
         licensing of the Technology, which have not been disclosed to Ilex as
         of the date of this Agreement.

                                 17. DISCLAIMER

Except as expressly set out in Article 16, Bioenvision does not make any express
or implied warranties, statutory or otherwise, concerning the Technology or any
technical information communicated by Ilex by Bioenvision. Specifically, but
without limiting the foregoing, Bioenvision makes no express or implied warranty
of merchantability, fitness (for a particular purpose or otherwise), safety or
usefulness of the Technology, Patents, Improvements, Products, or Inventions.
All physical embodiments of the Technology, Patents, Improvements, Products, or
Inventions provide by Bioenvision are provided on an "as is" basis. Bioenvision
does not warrant the accuracy of any information included within the Technical
Information nor does Bioenvision warrant that any such information constitutes
trade secrets or confidential information or that the patents will be free from
claims of infringement by third parties or any other rights of third parties
except as otherwise set forth in this Agreement. Under no circumstances shall
either party be liable to the other party or any third party for any incidental
or consequential damages in tort, contract, strict liability or otherwise
incurred by other party or any third party.

                               18. INDEMNIFICATION

18.1     Bioenvision hereby agrees to indemnify, defend and hold harmless Ilex,
         its Affiliates, officers, directors, employees and agents from and
         against any liabilities, claims, damages, costs, expense (including
         reasonable attorneys' fees), judgments (collectively, "Damages")
         arising out of, based upon or resulting from a material breach of this
         Agreement (including without limitation the breach of a representation,
         warranty or covenant) by Bioenvision, except to the extent that any
         such Damage arise out of, are based upon or result from (i) a breach of
         the Agreement (including without limitation the breach of a
         representation, warranty or covenant) by Ilex, or (ii) the negligence
         or willful misconduct of Ilex.

18.2     Ilex hereby agrees to indemnify, defend and hold harmless Bioenvision,
         its Affiliates, officers, directors, employees and agents from and
         against any Damages arising out of, based upon or resulting from a
         material breach of this Agreement (including without limitation the
         breach of a representation, warranty or covenant) by Ilex, except to
         the extent that any such Damages arise out of, are based upon or result
         from (i) a breach of this agreement (including without limitation, the
         breach of a representation, warranty or covenant) by Bioenvision, or
         (ii) the negligence or willful misconduct of Bioenvision.

                                                                              21
<PAGE>

18.3     Any part entitled to indemnification under paragraph (a) or (b) of this
         Article 18 (an "Indemnified Party") shall promptly notify the party
         potentially responsible for such indemnification (the "Indemnifying
         Party") upon becoming aware of any claim or claims asserted or
         threatened against such Indemnified Party which could give rise to a
         right of indemnification under this Agreement; provided, however, that
         the failure to give such notice shall not relieve the Indemnifying
         Party of its indemnity obligation hereunder except to the extent that
         such failure substantially prejudices its rights hereunder.

18.4     The Indemnifying Party shall have the right to defend, at its sole cost
         and expense, such claim by all appropriate proceedings, which
         proceedings shall be prosecuted diligently by the Indemnifying Party to
         a final conclusion or settled at the discretion of the Indemnifying
         Party; provided, however, that the Indemnifying Party may not enter
         into any compromise or settlement unless the Indemnified Party consents
         thereto, which consent shall not be unreasonably withheld, conditioned
         or delayed.

18.5     The Indemnified Party may participate in, but not control, and defense
         or settlement of any claim controlled by the Indemnifying Party
         pursuant to this Article 18 and shall bear its own costs and expenses
         with respect to such participation; provided, however, that the
         Indemnifying Party shall bear such costs and expenses if counsel for
         the Indemnifying Party shall have reasonably determined that such
         counsel may not properly represent both the Indemnifying Party and the
         Indemnified Party.

18.6     If the Indemnifying Party fails to notify the Indemnified Party within
         twenty (20) days after receipt of notice of a claim in accordance with
         Article 18.3 hereof that it elects to defend the Indemnified Party
         pursuant to this Article 18.3, or if the Indemnifying Party elects to
         defend the Indemnified Party but fails to prosecute or settle the claim
         diligently and promptly, then the Indemnified Party shall have the
         right to defend, at the sole cost and expense of the Indemnifying
         Party, the claim by all appropriate proceedings, which proceedings
         shall be promptly and vigorously prosecuted by the Indemnified Party to
         a final conclusion or settled; provided, however, that in no event
         shall the Indemnifying Party be required to indemnify the Indemnified
         Party for any amount paid or payable by the Indemnified Party in the
         settlement of any such claim agreed to without the consent of the
         Indemnifying Party, which shall not be unreasonably withheld,
         conditioned or delayed.

                                                                              22
<PAGE>

18.7     Notwithstanding anything in this Article 18 to the contrary, Ilex shall
         be responsible for any liability created or occurring in the USA and
         Canada for or on account of any injury, loss or damage, of any kind or
         nature sustained by, or any damage assessed or asserted against, or any
         other liability incurred by or imposed upon either party arising out of
         or in connection with or resulting from, directly or indirectly, (i)
         the production, use or sale of any Product, Technology, Invention, or
         Improvement by Ilex or any Ilex Affiliate or Sublicensee or (ii) the
         use by Ilex or any Ilex Affiliate or Sublicensee of any technical
         information, techniques, or practices disclosed by either party, or
         (iii) any advertising or other promotional activities with respect to
         any of the foregoing by Ilex or any Affiliate or Sublicensee. If a
         sublicense is granted by Ilex to a third party that third party shall
         accept all liability for any injury, loss or damage as defined above.

                                  19. INSURANCE

Ilex shall maintain, during the term of this Agreement, reasonable amounts of
comprehensive general liability insurance, including products liability
insurance, with reputable and financially secure third party insurance carriers
to cover the activities of Ilex, its Affiliates and Sublicensees hereunder, and
in amounts and on such terms as are commercially reasonable in accordance with
customary industry practices. Such insurance shall be written to cover claims
incurred, discovered, manifested, or made during the term of this Agreement
during the period that any product, process, or service, relating to, or
developed pursuant to, this Agreement is being commercially distributed or sold
by Ilex or by a sublicensee, affiliate or agent of Ilex, and for a commercially
reasonable period thereafter. On or before the date of first commercial sale of
Clofarabine or other Product by Ilex or its Affiliates or Sublicensees, Ilex
shall furnish to Bioenvision a certificate of insurance evidencing such coverage
and periodically, upon request, provide evidence that the coverage is still in
effect. During the period from the date of this Agreement through the date of
first commercial sale of Clofarabine or other Product by Ilex or its Affiliates
or Sublicensees, Ilex shall maintain (during the term of this Agreement)
reasonable amounts of general liability insurance with reputable and financially
secure third party insurance carriers to cover the activities of Ilex, its
Affiliates and Sublicensees hereunder, in amounts and on such terms as are
commercially reasonable in accordance with customary industry practices. Such
insurance shall be written to cover claims incurred, discovered, manifested, or
made during the term of this Agreement, as a result of clinical trials or
otherwise, and for a commercially reasonable period thereafter. Ilex shall
furnish to Bioenvision a certificate of insurance evidencing such coverage
within fifteen (15) days of the effective date of this Agreement and
periodically, upon request, provide evidence that such coverage is still in
effect.

                            20. TERM AND TERMINATION

20.1     This Agreement shall commence on the Effective Date and, unless sooner
         terminated under this Article 20, this Agreement (other than the
         portions thereof pertaining to confidentiality and restrictions on use
         of intellectual property of the other party) shall expire upon
         expiration of the last to expire of all Patent(s), relating to
         Clofarabine or any other Product including any extensions thereof and
         any periods of exclusivity granted by regulatory agencies or other
         governmental bodies, whereupon the terms of Article 20.3 shall apply.
         In the event that (i) Bioenvision no longer holds a license or
         sublicense to use any of the Patent(s), Improvement(s) and Patent(s)
         relating to the Products; or (ii) the SRI Agreement is terminated; then
         this Agreement shall be considered to have expired but the terms of
         Article 20.2 may still apply. Furthermore, this Agreement shall expire
         when Bioenvision is no longer due any payments from Ilex or any of its
         sublicensee(s).

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<PAGE>

20.2     In the event the SRI Agreement is terminated for any reason, other than
         default by ILEX of any material obligation under this Agreement, SRI
         agrees to continue any license arrangement with ILEX as contemplated in
         this Agreement under the same terms as set forth herein.

20.3     The payment obligations under this Agreement shall continue throughout
         the term as defined in Article 20.1 but would be subject to good faith
         renegotiations upon the expiration of the last to expire of the
         Patents, or upon the abandonment of the last to be abandoned of any
         patent applications if no patents have been issued, whichever is the
         later, unless this Agreement is sooner terminated. Such good faith
         renegotiations shall take into account on a country-by-country or
         regional basis but not be limited to: (i) Product competition; (ii)
         utilization, incorporation and value of Technical Information; (iii)
         value of Technical Information if no longer confidential or proprietary
         through no fault of Bioenvision, Ilex or their Sublicensee(s),
         contractors, financiers or any other Bioenvision agent(s) or purchasers
         of Product or services having access to Technical Information; (iv) the
         applicable contract or patent law or (v) prior payment commitments
         described in Article 3, provided that in no event shall such payment
         obligations extend beyond such patent expiration or abandonment by more
         than five (5) years, unless Ilex or it's Sublicensees continue to be
         the exclusive commercial source of Clofarabine and/or any other Product
         in the USA and Canada in which case the royalty payments set forth
         herein shall continue at a renegotiated rate (not to exceed 1/2 of the
         royalty rates then in effect) for an additional five (5) year period or
         until the commercial exclusivity is lost, whichever event occurs first.
         SRI shall use its best efforts to ensure that Ilex continues to be the
         exclusive commercial source of Clofarabine and/or any Product in the
         USA and Canada during the extension periods referred to in this
         Article.

20.4     Upon termination of this Agreement, neither party shall be released
         from any obligation that matured prior to the effective date of such
         termination or from indemnification obligations pursuant to Article 18
         arising with respect to the period through the termination date. Ilex
         and any sublicensee may, however, after the effective date of such
         termination, sell, in an orderly and commercially reasonable fashion,
         all Products in inventory provided that Ilex shall pay to Bioenvision
         the royalties thereon as required by Article 6 hereof and submit the
         reports required by Article 8 hereof and that the indemnification
         obligations pursuant to Article 18 shall apply with respect to those
         sales.

                                                                              24
<PAGE>

20.5     Except as provided in this Agreement, if either party shall be in
         default of any obligation hereunder (including without limitation a
         breach of a representation, warranty or covenant), the other party may
         terminate this Agreement by giving notice of termination by certified
         or registered mail to the party at fault, specifying the basis for
         termination. If within sixty (60) days after the receipt of such notice
         of termination, the party in default shall remedy the condition forming
         the basis for termination such notice of termination shall cease to be
         operative, and this Agreement shall continue in full force. In
         addition, Ilex shall have the right to terminate this Agreement without
         further liability, except as provided under Article 20.3, upon thirty
         (30) days prior written notice to Bioenvision, if Clofarabine fails to
         demonstrate sufficient efficacy in the treatment of CLL to meet the
         approval criteria that have been agreed upon with the FDA, or if
         substantial adverse patient reactions or other factors relating to the
         inherent toxicity or side effects of Clofarabine are uncovered which
         would cause the FDA to withdraw marketing approval for CLL or to turn
         down any request for such marketing approval. Upon any termination of
         this Agreement by Ilex, Ilex shall immediately pay any and all unpaid
         amounts which have accrued through that date, and any unexercised stock
         options granted pursuant to this Agreement shall be terminated.

20.6     Bioenvision or Ilex may terminate this Agreement upon written notice to
         the other party if that other party makes a general assignment for the
         benefit of creditors, is the subject of proceedings in voluntary or
         involuntary bankruptcy or has a receiver or trustee appointed for
         substantially all of its property; provided that in the case of an
         involuntary bankruptcy proceeding such right to terminate shall only
         become effective if the other party consents thereto or such proceeding
         is not dismissed within ninety (90) days after the filing thereof. Each
         of the parties hereto acknowledges and agrees that this Agreement (i)
         constitutes a license of Intellectual Property (as such term is defined
         in the United States Bankruptcy Code, as amended (the "Code"), and (ii)
         is an executory contract, with significant obligations to be performed
         by each party hereto. The parties agree that either party may fully
         exercise all of its rights and elections under the Code, including,
         without limitation, those set forth in Section 365(n) of the Code. The
         parties further agree that, in the event that either party elects to
         retain its rights under the Code, that party shall be entitled to
         complete access to any technology licensed to it hereunder and all
         embodiments of such technology. Such embodiments of the technology
         shall be delivered to such party not later than (a) the commencement of
         bankruptcy proceedings against the other party, unless the other party
         elects to perform its obligations under this Agreement, or (b) if not
         delivered under (a) above, upon the rejection of this Agreement by or
         on behalf of the other party.

                                                                              25

<PAGE>

20.7     It is the parties' intent and understanding that to the extent
         Bioenvision receives royalty payments from ILEX or other parties
         pursuant hereto for the purpose of making such payments to SRI, such
         payments are to be income to Bioenvision for tax purposes only if, and
         to the extent that, Bioenvision has corresponding and equal deductions
         from taxable income, for tax purposes. If and to the extent that this
         should prove not to be the case in any tax jurisdiction, the parties
         shall promptly take such steps as shall be necessary to amend the terms
         of this Agreement in respect of such tax jurisdiction only as necessary
         to cause the parties intent, as expressed in the first sentence of this
         paragraph, to be the case.

                   21. CONFIDENTIALITY; PUBLICATION; PUBLICITY

21.1     Except as expressly set forth in this Article 21, each party shall, and
         shall cause its Affiliates and its and their respective officers,
         directors, employees, agents and subcontractors (collectively,
         "Representatives") to keep confidential any and all technical,
         commercial, scientific and other proprietary data, processes, documents
         or other information (whether in oral, written or electronic form) or
         physical object (including, without limitation, Inventions,
         Improvements, Technology, Patents, Products, Technical Information,
         intellectual property, marketing data, agreements, license
         applications, and business plans and projections of any party acquired
         from the other party, its affiliates or any of their respective
         Representatives (the "Providing Party") in respect of the transactions
         contemplated by this Agreement ("Confidential Information"), and,
         except to the extent necessary to develop and/or market Clofarabine or
         any other Product pursuant to this Agreement, each party shall not
         disclose directly or indirectly, and shall cause its respective
         Affiliates and Representatives not to disclose directly or indirectly,
         any Confidential Information to anyone outside such Person, such
         affiliates and their respective Representatives, except that the
         foregoing restriction shall not apply to any information disclosed
         hereunder to any party if such Person (the "Receiving Person") can
         reasonably demonstrate that such Confidential Information:

                  (i) is or hereafter becomes generally available to the trade
                  or public other than by reason of any breach hereof;

                  (ii) was already known to the Receiving Person or such
                  affiliate or Representative;

                  (iii) is disclosed to the Receiving Person or such affiliate
                  or Representative by a Third Party who has the right to
                  disclose such information;

                                                                              26

<PAGE>

                  (iv) is developed by or on behalf of the Receiving Person or
                  any of its affiliates independently, without reliance on
                  Confidential Information received hereunder; or

                  (v) is otherwise required to be disclosed in compliance with
                  applicable legal requirements by a governmental authority or
                  regulatory body, the Receiving Party promptly notifies the
                  Providing Party of the obligation to disclose in order to
                  allow the Providing Party to object or seek a protective
                  order, and such information shall remain confidential
                  Information for all other purposes unless subparagraphs (i)
                  through (iv) above otherwise apply.

21.2     Except solely in furtherance of their respective rights and obligations
         hereunder, each party agrees that it shall not (and shall not permit
         any of its affiliates to) at any time use any Confidential Information
         in the conduct of its businesses without the prior written consent of
         the other party. The obligations set forth in this Article 21 shall
         extend to copies, if any, of Confidential Information made by any of
         the Persons referred to in Article 21 and to documents prepared by such
         persons which embody or contain Confidential Information, and to any
         electronic data files containing Confidential Information.

21.3     Each party shall deal with Confidential Information so as to protect it
         from disclosure with a degree of care not less than that used by it in
         dealing with its own information intended to remain exclusively within
         its knowledge, but not less than a reasonable standard of care, and
         shall take reasonable steps to minimize the risk of disclosure of
         Confidential Information.

21.4     The obligations set forth in this Article 21 shall survive the
         expiration, termination or assignment of this Agreement, for a period
         of five (5) years thereafter.

21.5     The Receiving Person shall (and shall cause its affiliates and
         Representatives to), at the written request of the disclosing Person,
         return all Confidential Information to the disclosing Person or destroy
         all Confidential Information in its or their possession; provided,
         however, that the Receiving Person may, retain one set of copies solely
         for legal archival and compliance purposes.

21.6     (i) If either party desires to publish or present the results of the
         Co-Development Program, the publishing/presenting party shall provide
         the non-publishing/non-presenting party a copy of the manuscript of any
         proposed publication or presentation. The non-publishing/non-presenting
         party shall then have thirty (30) days to review and comment on the
         manuscript or presentation, and the publishing/presenting party agrees
         to delete any information identified by the non-publishing/
         non-presenting party as its trade secrets or Confidential Information.

                                                                              27

<PAGE>

         (ii) In the event the non-publishing/non-presenting party determines
         that a Patent application covering information contained in the
         proposed publication or presentation should be filed, the party
         proposing the publication or presentation shall delay such publication
         or presentation for up to sixty (60) days to allow such filing to be
         made.

21.7     Each party shall provide the other party with the prior opportunity to
         review and approve any press releases or similar public announcements
         concerning this Agreement or clinical, regulatory and commercial
         developments related to Products as soon as practicable, but in no
         event less than 24 hours before an announcement is made, provided, that
         nothing contained herein shall preclude any party hereto from making
         such disclosures in such fashion as it reasonably believes are required
         under applicable law, based upon the advice of competent legal counsel.
         Bioenvision shall not use the name of Ilex or otherwise refer to any
         organization related to Ilex, except with the written approval of Ilex,
         such approval not to be unreasonably withheld. Ilex shall not use the
         name of Bioenvision or otherwise refer to any organization related to
         Bioenvision, except with the written approval of Bioenvision, such
         approval not to be unreasonably withheld.

                             22. DISPUTE RESOLUTION

22.1     The parties shall attempt to resolve through good faith discussions any
         dispute which arises under this Agreement. Any dispute may, at the
         election of either party, be referred to the chief executive officers,
         (or the equivalent), of each party. If they are unable to resolve the
         dispute, within thirty (30) days after delivery of written notice of
         the dispute from one party to the other, either party may seek to
         resolve it by initiating Alternative Dispute Resolution ("ADR") at the
         geographical location of the noninitiating party in which the Judicial
         Arbitration and Mediation Services ("JAMS") of such location, through a
         panel of three (3) arbitrators (the "Arbitrators"), shall control the
         proceedings as provided herein. If JAMS is not in existence at the time
         of such dispute, the American Arbitration Association, of such location
         shall be substituted.

22.2     An ADR shall be initiated by a party by sending written notice thereof
         to the other party and JAMS, which notice shall state the issues to be
         resolved. Within ten (10) business days after receipt of such notice,
         the other party may, by sending written notice to the initiating party
         and JAMS, add issues to be resolved. Within twenty (20) business days
         after the date of the original ADR notice, JAMS shall nominate to the
         parties at least ten (10) qualified nominees from JAMS' panel of
         potential arbitrators. Each arbitrator shall have experience in the
         Field relevant to the dispute and in intellectual property law matters.
         Each party shall have five (5) business days after the receipt of such
         nominations to select one arbitrator. The two (2) arbitrators so
         selected shall mutually agree on a third arbitrator to complete the
         panel.

                                                                              28
<PAGE>

22.3     In the event of a dispute between the parties relating to the
         calculation of any royalties or the amount of other consideration
         payable under this Agreement (including without limitation, the results
         of any audit conducted on behalf of a party pursuant to Article 9),
         then, in addition to the procedure set forth above and in Article 22.2,
         the Arbitrators shall be partners or full members of an internationally
         recognized certified public accounting firm which is not an auditing
         firm for either party and has not provided material services to either
         party during the last two (2) year period prior to the date of ADR
         initiation.

22.4     Except as otherwise provided in this Article 22, such hearing shall be
         conducted pursuant to the JAMS Rules or the Commercial Arbitration
         Rules of the American Arbitration Association (AAA) as applicable.

22.5     The Arbitrators shall render a disposition on the proposed rulings as
         expeditiously as possible after the hearing, but not later than fifteen
         (15) business days after the conclusion of the hearing. In the
         circumstances where the Arbitrators rule for a party on a claim in the
         form of a claim for monetary damages, the parties will then submit a
         proposed remedy within ten (10) days of notice of the ruling. The
         proposed remedy may be accompanied by a brief in support of the remedy
         not to exceed five (5) pages. The Arbitrators will rule on the proposed
         remedies within ten (10) days of their submission. The Arbitrators'
         disposition shall be final and not appealable, except that either party
         shall have the right to appeal such disposition on the basis it was
         affected by fraud or bad faith in connection with the ADR proceedings.
         A judgment on the Arbitrators' disposition may be entered in any court
         having jurisdiction over the parties. The reasonable fees and expenses
         of the Arbitrators, as well as the standard charges of JAMS for its
         assistance, shall be borne equally by the parties or as they may
         otherwise agree.

22.6     A party shall not be prohibited from bringing a claim for resolution
         under this Article 22 on the ground that the claim could have been
         brought during an earlier proceeding under this same Article.

22.7     The following disputes, causes of action or claims shall not be subject
         to the dispute resolution process set forth in this Article 22:

         (i)      a claim arising from a suit, action, or proceeding brought by
                  a third party or Sublicensee not subject to ADR;

         (ii)     a claim relating to undisputed amounts owed by either party to
                  the other under this Agreement;

                                                                              29

<PAGE>

         (iii)    a suit, action, or proceeding to compel either party to comply
                  with the dispute resolution procedures set forth in this
                  Article 22;

         (iv)     a dispute, controversy, or claim relating to the scope,
                  enforceability, infringement or validity of a patent or
                  trademark of either party; and

         (v)      a cause of action seeking temporary or preliminary injunction
                  relief.

                                23. ASSIGNABILITY

Neither party shall assign any rights under this Agreement not specifically
transferable by its terms without prior written consent of the other party,
which consent shall not be unreasonably withheld; provided further, that either
party may assign upon prior written notice to the other party if the assignment
is in connection with the sale or other transfer of all of the business of the
assigning party to which this Agreement relates. Subject to the limitation on
assignment herein, this Agreement shall be binding upon and inure to the benefit
of the successors in interest and assigns of Bioenvision and Ilex. In order for
any assignment to be effective, any such assignee of or successor to a party's
interest shall expressly assume in writing the performance of all the terms and
conditions of this Agreement to be performed by said party and such assignment
shall not relieve the assignor of any of its obligations under this agreement.

                                   24. REFORM

24.1     The parties agree that if any part, form, or provision of this
         Agreement shall be found illegal or in conflict with any valid
         controlling law, the validity of the remaining provisions shall not be
         affected thereby.

24.2     In the event the legality of any provision of this Agreement is brought
         into question because of a decision by a court of competent
         jurisdiction of any country in which this Agreement applies,
         Bioenvision, by written notice to Ilex, may revise the provision in
         question or may delete it entirely so as to comply with the decision of
         the said court.

                            25. WAIVER AND ALTERATION

25.1     The failure of either party to insist, in any one or more instances,
         upon the performance of any of the terms, covenants or conditions of
         this Agreement and to exercise any right hereunder, shall not be
         construed as a waiver or relinquishment of the future performance of
         any such term, covenant or condition or the future exercise of such
         right, but the obligations of the other party with respect to such
         future performance shall continue in full force and effect.

                                                                              30
<PAGE>

25.2     A provision of this Agreement may be altered only by a writing signed
         by both parties, except as provided by Article 24, above.

                                   26. MARKING

26.1     Ilex shall place in a conspicuous location on any product or its
         packaging, which is made or sold under any Patent coming within this
         Agreement, a patent notice in accordance with the laws concerning the
         marking of patented articles of the particular jurisdiction where any
         product is marketed or sold.

26.2     Ilex shall include a marking provision similar to Paragraph 26.1 above
         in every sublicense granted pursuant to Article 7 above.

                               27. IMPLEMENTATION

Each party shall execute any instruments reasonably believed by the other party
to be necessary to implement the provisions of this Agreement.

                                28. GOVERNING LAW

This Agreement shall be deemed to have been entered into and shall be governed
by, construed and enforced in accordance with laws of the State of Delaware
applicable to contracts wholly entered into and performed within such State, and
in the English language and, subject to the arbitration provisions of this
Agreement, any action brought to enforce any provision or obligation hereunder
shall be brought in a court of competent jurisdiction within the State of
Delaware.

                    29. EXPORTATION OF TECHNICAL INFORMATION

Ilex agrees not to export from The United States of America, directly or
indirectly, any Technical Information furnished to Ilex either directly or
indirectly by Bioenvision, except to the extent and to the countries permitted
by the laws of The United States of America. Ilex agrees to indemnify, defend
and hold harmless Bioenvision, its officers, agents and employees from all
liability involving the violation of such export regulations, either directly or
indirectly by Ilex.

                                  30. HEADINGS

The headings of the articles, sections and paragraphs used in this Agreement are
included for convenience only and are not to be used in construing or
interpreting this Agreement.

                                                                              31
<PAGE>

                             31. PARTIES INDEPENDENT

In making and performing this Agreement, the parties act and shall act at all
times as independent entities and nothing contained in this Agreement shall be
construed or implied to create an agency, partnership or employer and employee
relationship between Bioenvision and Ilex. Except as specifically provided
herein, at no time shall either party make commitments or incur any charges or
expenses for or in the name of the other party.

                                32. COUNTERPARTS

This Agreement shall become binding when any one or more counterparts hereof,
individually or taken together, shall bear the signatures of each of the parties
hereto. This Agreement may be executed in any number of counterparts, each of
which shall be an original as against either party whose signature appears
thereon, but all of which together shall constitute but one and the same
instrument.

A facsimile copy of the signed Agreement shall be evidence of execution to the
parties provided that original hard copies of the Agreement are executed and
delivered within five (5) working days of the date of execution below.

                                33. FORCE MAJEURE

The parties shall not be responsible for failure to perform any of the
obligations imposed by this Agreement (except an obligation to pay money),
provided such failure is caused by fire, storms, floods, strikes, lockouts,
accidents, war, riots or civil commotions, inability to obtain railroad cars or
raw materials, embargoes, any State or Federal regulation, law, or restriction,
seizure or acquisition of the Technology or the Product(s) by the Government of
the United States or of any state, or of any agency thereof or by reason of any
compliance with a demand or request for such Product for any purpose for
national defense, or any other cause or contingency beyond the reasonable
control of said party (whether or not of the same kind or nature as the causes
or contingencies above enumerated), and such a failure shall not subject the
party so failing to any liability to the other; provided, that the
non-performing party shall provide prompt written notice to the other party of
the particular occurrence constituting a force majeure and of its cessation and
shall make diligent efforts to mitigate the adverse consequences of such
non-performance or delays in performance.

                           34. SURVIVAL OF OBLIGATIONS

In the event of any termination of this Agreement, all obligations of
Bioenvision and ILEX existing prior to termination and all obligations, whether
known or unknown at the time of termination, stemming from the act or omissions
of a given Party, while this

                                                                              32

<PAGE>

Agreement was in force and effect, shall remain an obligation of the given Party
until discharged. Article(s) 4, 5, 7, 9, 13, 18, 19, 21 and 22 as well as any
other provisions to the extent required for the full observation and performance
of the foregoing Articles or which by their nature are intended to survive such
termination, shall survive the termination of this Agreement and continue to be
enforceable.

                                   35. NOTICE

For the purpose of all written communications between the parties, their
addresses shall be:

If to BIOENVISION:                                If to ILEX:

Address:                                          Address:

One Rockefeller Plaza, Suite 1600                 4545 Horizon Hill Blvd.
New York, New York 10020                          San Antonio, Texas 78229-2263

Attn: C B Wood                                    Attn: Al A. Jecminek
      ---------------------------                       ------------------------

Telephone: 011-44 1753 664120                     Telephone: 210/949-8443
           ----------------------                           --------------------

Fax: 011-44 1753 664120                           Fax: 210/949-8261
     ----------------------------                      -------------------------

or any other addresses of which either party shall notify the other party in
writing. A copy of all notices to Bioenvision should be sent to Andrew Cosentino
at: Piper Marbury Rudnick & Wolfe LLP, 1251 Avenue of the Americas, 29th Floor,
New York, New York 10020-1104.

                                                                              33

<PAGE>

         IN WITNESS WHEREOF the parties have caused this Agreement to be
executed by their duly authorized officers on the respective dates and at the
respective places hereinafter set forth.

BIOENVISION:                                   ILEX:

By: /s/ C. B. Wood                             By: /s/ Ze'ev Shaked. Ph.D
   --------------------------------               ------------------------------
Print Name: C. B. Wood                         Print Name:  Ze'ev Shaked. Ph.D.
           ------------------------                       ----------------------

Its: Chairman                                  Its: Executive Vice President/COO
     ------------------------------                 ----------------------------

Date: March 16, 2001                            Date: March 21, 2001
      -----------------------------                   --------------------------

Also, by signature of its duly authorized representative below, Southern
Research Institute accepts and agrees to all terms and conditions of this
Agreement which apply directly or indirectly to Southern Research Institute

SOUTHERN RESEARCH INSTITUTE

By: /s/ Randall C. Shealy
   -----------------------------------

Print Name: Randall C. Shealy
            --------------------------

It's: Chief Financial Officer
     ---------------------------------

Date: March 12, 2001
     ---------------------------------

                                                                              34

<PAGE>

                                   Appendix I

                         Patents and Patent Applications

<TABLE>
<CAPTION>

                    Filing                                                        Expiration
Country             Serial No.      Date             Priority      Patent No.      Issued           Date
<S>                <C>              <C>              <C>           <C>                            <C>
United States       07/355,358      5/23/89          5/23/89       5,034,518       7/23/91        7/23/2008

United States       07/693,646      5/10/91          5/23/89       5,384,310       1/24/95        7/23/2008
                                                   & 5/10/91

United States       08/320,879      9/21/94          5/10/91       5,661,136       8/26/97        9/21/2014(1)

European            90909080.5      5/23/90          5/23/89 U.S.  0473708
    France                                                         0473708         1/15/97        5/23/2010
    Germany                                                        0473708         1/25/97        5/23/2010
    Great Britain                                                  0473708         1/15/97        5/23/2010
    Italy                                                          0473708         1/25/97        5/23/2010
    Netherlands                                                    0473708         1/25/97        5/23/2010
    Spain                                                          0473708         1/25/97        5/23/2010
    Sweden                                                         90909080.5      1/15/97        5/23/2010
    Switzerland                                                    0473708         1/25/97        5/23/2010

Canada             2,102,782         5/7/92          5/10/91      (Request for examination filed
                                                                   2/8/99; Claims equivalent to
                                                                   U.S. 07/693,646)
United States     60/183,422         2/18/00
PCT           Not assigned           2/16/01         2/18/00
</TABLE>

-------------
(1) The expiry date for patents pending before the June 8, 1995 GATT
implementation, is the greater of the 20 year term or the 17 year term. The 20
year term is the longer term for the above US Patent No. 5,661,136.

                                                                              35

<PAGE>

                                   Appendix II

              Co-Development Agreement between Bioenvision and SRI

                                                                              36

<PAGE>

                           AGREEMENT TO GRANT LICENSE

WHEREAS Southern Research Institute (SRI) of 2000 Ninth Avenue South,
Birmingham, Alabama 35205 and Eurobiotech Group, Inc. (Eurobiotech), a Delaware
company have entered into an Agreement to co-develop certain technology, and;

WHEREAS SRI has granted to Eurobiotech a license to co-develop the technology
and to market product(s) developed from the technology in certain territories,
as defined by the Co-development Agreement entered into by the parties, it is
further agreed;

SRI shall allow Eurobiotech to license the technology to Bioenvision, Inc, a
Delaware company that has acquired 100% of the equity holdings in Eurobiotech.
It is agreed that Bioenvision shall be bound by the terms of the Co-development
Agreement and shall make the payment due to SRI under the terms of that
Agreement.

IN WITNESS WHEREOF the parties have caused this Agreement to be executed by
their duly authorized officers on the respective dates and at the respective
places hereinafter set forth.

EUROBIOTECH:                                SRI:

/s/ C.B. Wood                               /s/ G.E. Dwyer
------------------------------              ------------------------------------
Signature                                   Signature

C.B. Wood                                   G.E. Dwyer
------------------------------              ------------------------------------
Print name                                  Print name

19/8/98                                     9/1/98
------------------------------              ------------------------------------
Date                                        Date

<PAGE>

                            CO-DEVELOPMENT AGREEMENT
                           BETWEEN SRI AND EUROBIOTECH

<PAGE>

TABLE OF CONTENTS

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

2.   LICENSE AND CO-DEVELOPMENT PROGRAM .................................   3

3.   TECHNICAL INFORMATION LICENSE ......................................   4

4.   LICENSE FEE AND RESEARCH AND DEVELOPMENT FUNDING ...................   5

5.   ACQUISITION ........................................................   6

6.   COMMERCIALIZATION STAGE ............................................   7

7.   SUBLICENSING .......................................................   8

8.   PAYMENTS AND REPORTS ...............................................   8

9.   RECORDS ............................................................  10

10.  DILIGENCE ..........................................................  10

11.  OWNERSHIOP OF THE TECHNOLOGY, TECHNICAL INFORMATION
     AND IMPROVEMENTS ...................................................  10

12.  PATENT PROSECUTION .................................................  11

13.  INFRINGEMENT BY THIRD PARTY ........................................  11

14.  REVOCATION PROCEEDINGS .............................................  12

15.  INFRINGMENT OF THIRD PARTY RIGHTS ..................................  13

16.  REPRESENTATIONS ....................................................  13

17.  DISCLAIMER .........................................................  14

18.  INDEMNIFICATION ....................................................  14

19.  INSURANCE ..........................................................  15

20.  TERMS AND TERMINATION ..............................................  15

                                       i

<PAGE>

21.   CONFIDENTIALITY; PUBLICATION; PUBLICITY ............................  16

22.   DISPUTE RESOLUTION .................................................  18

23.   ASSIGNABILITY ......................................................  19

24.   REFORM .............................................................  20

25.   WAIVER AND ALTERATION ..............................................  20

26.   MARKING ............................................................  20

27.   IMPLEMENTATION .....................................................  21

28.   GOVERNING LAW ......................................................  21

29.   EXPORTATION OF TECHNICAL INFORMATION ...............................  21

30.   HEADINGS ...........................................................  21

31.   PARTIES INDEPENDENT ................................................  21

32.   COUNTERPARTS .......................................................  22

33.   FORCE MAJEURE ......................................................  22

34.   NOTICE .............................................................  21

35.   EXECUTION ..........................................................  23

 APPENDIX I -       PATENTS

 APPENDIX II-       TERMS FOR EUROBIOTECH GROUP, INC. ("EUROBIOTECH") AND
                    SOUTHERN RESEARCH INSTITUTE ("SOUTHERN") CO-DEVELOPMENT
                    AGREEMENT

 APPENDIX III -     EXTENSION OF THE CO-DEVELOPMENT PROGRAM BETWEEN SOUTHERN
                    RESEARCH INSTITUTE AND EUROBIOTECH GROUP, INC.

 APPENDIX IV -      GROSS PROFIT MARGIN AND NET INCOME EXAMPLES

 APPENDIX V -       INTER-INSTITUTIONAL AGREEMENT

                                       ii

<PAGE>

                            CO-DEVELOPMENT AGREEMENT

THIS AGREEMENT (the "Agreement") is entered into and effective this 31st day of
August 1998, the same date affixed hereto by the party last signing this
Agreement, by and between Southern Research Institute having its principal place
of business in Birmingham, Alabama, herein called "SRI", and Eurobiotech Group,
Inc. having a place of business in 40 South Audley Street, London W1, Great
Britain herein called "Eurobiotech".

WITNESSETH

WHEREAS, SRI has rights in patents and technical information relating to the
development and uses of 2'-fluoro-2-halo substituted purine nucleosides
effective in vivo against hematologic malignancies and solid tumors as well as
potentially effective for other therapeutic indications such as skin disorders,
arthritis and transplantation immunity; and

WHEREAS, Eurobiotech recognizes that SRI owns inventions and intellectual
property useful in the conduct of Eurobiotech's business; and

WHEREAS, Eurobiotech recognizes that its anticipated business activity will
encompass the practice of technology that requires a license under patents owned
by SRI; and

WHEREAS, Eurobiotech wishes to acquire certain rights to practice the inventions
of such patents and technical information; and

WHEREAS the parties have signed a "Terms for ... Co-Development Agreement" set
forth in Appendix II, to enter into this Agreement, and

NOW THEREFORE, in consideration of the mutual covenants herein contained and
intending to be legally bound thereby, the parties agree as follows:

                                 1. DEFINITIONS

As usual herein the following terms shall have the meanings set forth below:

A.       Co-Development Program means the joint development of the Technology by
         Eurobiotech and SRI.

B.       Commercialization Stage means that period of time during which
         Eurobiotech is directly marketing and selling Product(s) through normal
         distribution channels in any region of the Territory after receiving
         regulatory agency approval to do so in such region.

C.       Cost of Goods Sold means the release to the current period as a result
         of the sale of a Product(s) of inventoriable costs (the sum of direct
         costs and manufacturing overhead) adjusted for changes in ending and
         beginning inventory levels.

<PAGE>

D.       Eurobiotech means Eurobiotech Group, Inc. and joint ventures,
         subsidiaries, or other business entities controlled directly or
         indirectly by Eurobiotech or in which Eurobiotech owns at least
         fifty-one percent (51%) interest.

E.       Field means, and is limited to, the practice of the Patent, Invention
         and Technical Information licensed hereunder for use in human health
         applications.

F.       Gross Margin means the difference between the manufacturing Cost of
         Goods Sold and Gross Sales Revenue, with SRI royalties treated as an
         excluded cost.

G.       Gross Profit Margin means the ratio of Gross Margin to Gross Sales
         Revenue expressed in percentage terms.

H.       Gross Sales Revenue means the gross amount recognized by Eurobiotech or
         its affiliates for the sale of a Product(s) through normal distribution
         channels (as determined by generally accepted accounting principles),
         less any deductions for value added taxes incurred and not recovered by
         Eurobiotech or the equivalent in Great Britain or elsewhere in the
         Territory.

I.       Invention means patented and unpatented, patentable and unpatentable,
         proprietary technology related to a 2'-fluoro-2-halo substituted purine
         nucleoside (hereafter "Technology") developed by or on behalf of SRI,
         that is (i) related to human health applications of the Technology or
         (ii) necessary for the practice of Technology for human health
         applications as disclosed and claimed in the Patent(s).

J.       Improvement means those unencumbered technology advances in the
         Technology made by or on behalf of SRI during the term of this
         Agreement that are either within the scope of and would constitute an
         infringement of the Patent claims or use Technical Information and are
         within the Field. SRI shall be obligated to include within the licenses
         granted only those SRI Improvements developed during the first three
         (3) years from the effective date of the Agreement which would be
         reasonably deemed necessary for Eurobiotech's practice of the
         Technology, and without which such practice would constitute an
         infringement of SRI's rights, unless such grant is not possible due to
         SRI's obligations to a third party. Notwithstanding the limitation of
         SRI's obligation set forth in the previous sentence, all Improvements
         developed under projects funded, in whole or in part, by Eurobiotech
         will be included in the licenses granted in this Agreement. In the
         event that a conflicting obligation prevents SRI from including an
         Improvement within the grant of license, SRI shall use reasonable
         efforts to assist Eurobiotech to obtain rights from the appropriate
         third party or parties.

K.       Licensed Technology means the Patent, Improvement, and Technical
         Information relating to human health applications of Technology.

                                       2
<PAGE>

L.       Net Income means the difference between Gross Sales Revenue and the sum
         of Cost of Goods sold and Operating Expenses (Appendix IV), with SRI
         royalties, local taxes, corporate income taxes and foreign taxes
         treated as excluded costs.

M.       Patent means the patents and/or patent applications, set forth in
         Appendix 1, covering the Invention or Improvement as defined above,
         patents to be issued pursuant thereto, and all divisionals,
         continuations, continuations-in-part, reissues, substitutions, and
         extensions thereof, and any patent issuing on a patent application
         filed after the Effective Date of this Agreement which is included in
         the grant of license hereunder and any foreign counterparts of the
         foregoing.

N.       Product means a product, service, test, or information which is sold or
         provided for a fee and but for the license granted herein would
         infringe one or more claims of a Patent, or was discovered, developed,
         approved, manufactured or marketed using an Invention, Improvement or
         Technical Information.

O.       Technical Information means unencumbered published or unpublished
         confidential and proprietary information in the nature of research and
         development information, knowledge and technical data, together with
         trade secrets relating to the Technology, including any inventions in
         the possession of and belonging solely to SRI on or prior to the
         Effective Date of this Agreement and which SRI has the obligation to
         include in this Agreement, or which comes into the possession of
         Eurobiotech during the term of this Agreement and which is generated as
         a consequence of access to technical information provided by SRI. SRI
         shall include herein only that Technical Information which is
         reasonably necessary for Eurobiotech's practice of the Invention or
         without which such practice would constitute an infringement of SRI's
         rights. Technical Information includes only the above information which
         is developed by or on behalf of SRI, or is generated pursuant to
         research funded, in whole or in part, by Eurobiotech.

P.       Territory means worldwide, with the exception of Japan and Southeast
         Asia. Southeast Asia consists of Indonesia, Malaysia, Taiwan, Hong
         Kong, Singapore, Vietnam, Cambodia, Thailand, Laos, Philippines and
         South Korea.

                      2. LICENSE AND CO-DEVELOPMENT PROGRAM

A.       The parties to this Agreement hereby agree to jointly co-develop the
         Technology according to the terms of this Agreement which supersedes
         the "Terms for ... Co-Development Agreement" set forth in Appendix II
         and all other written or verbal agreements, express or implied, between
         SRI and Eurobiotech relating to co-development of the Technology except
         for the written understanding set forth in Appendix III.

B.       SRI hereby grants to Eurobiotech, to the extent of the Field for the
         Territory, an exclusive license to make, have made, use and sell
         Product(s).

                                        3

<PAGE>

C.       The exclusive license set forth herein shall remain exclusive for so
         long as Eurobiotech meets the payments and other obligations set forth
         with regard to the development and commercialization of the Licensed
         Technology or a Product. If such conditions are not met, SRI, in its
         sole discretion, may elect to terminate the Co-Development Agreement or
         take whatever actions it deems necessary.

D.       SRI reserves for itself all rights to practice the Inventions, Patent,
         Improvements and Technical Information except as exclusively licensed
         herein.

                            3.  TECHNICAL INFORMATION LICENSE

A.       To the extent it is able to do so, SRI hereby grants to Eurobiotech, to
         the extent of the Field for the Territory, an exclusive license to use
         the Technical Information necessary to practice the Technology such
         that Eurobiotech may make, have made, use and sell Product(s),
         including disclosures of the Technical Information as needed to obtain
         patent rights or authorization to sell or manufacture Products or
         services in the Field within any political jurisdiction requiring such
         disclosure.

B.       The exclusive license set forth herein shall remain exclusive for so
         long as Eurobiotech meets the payments and other obligations set forth
         with regard to the development and commercialization of the Licensed
         Technology or a Product. If such conditions are not met, SRI in its
         sole discretion may elect to terminate the Co-Development Agreement or
         take whatever action it deems necessary.

C.       (1) SRI shall make efforts to make available to Eurobiotech Technical
         Information in SRI's possession related to the Technology that SRI has
         the obligation to disclose under this Agreement. Eurobiotech shall not
         disclose to third parties any Technical Information furnished by SRI
         during the term of this Agreement, or any time thereafter, provided,
         however, that disclosure may be made of any such Technical Information
         at any time: (i) with the prior written consent of SRI, or (ii) to the
         extent necessary, to Eurobiotech's sublicensees and purchasers of
         Eurobiotech's Product(s) or services, or (iii) after the same shall
         have entered into the public domain through no fault of Eurobiotech or
         Eurobiotech's subsidiaries. Disclosure of Technical Information is
         permitted without a prior written consent of SRI to the extent required
         by statute, rule or regulation of a governing body during the course of
         Eurobiotech's normal business practices, or in the application or
         prosecution of an application for patent rights, or in connection with
         securing financing for the development or commercialization of the
         Technology or a Product. Eurobiotech shall inform SRI of any such
         disclosure and use its best efforts to protect its confidentiality
         under such disclosure. Any combination of Technical Information shall
         not be considered in the public domain merely because individual
         elements thereof are in the public domain. To the extent that any such
         Technical Information is disclosed to Eurobiotech's sublicensees and
         purchasers of Eurobiotech's Product(s) or services, the agreements
         contained in this Section shall be made

                                        4

<PAGE>

         Eurobiotech under a confidentiality agreement to apply to and be made
         binding upon all such parties.

         (2) The fact that some or all of the Technical Information becomes
         public knowledge shall not affect the financial obligations for use of
         the Technical Information licensed under this Agreement if such
         Technical Information was used or usable in the discovery, development,
         manufacture, or approval for sale of a Product within the Field.

              4.  LICENSE FEE AND RESEARCH AND DEVELOPMENT FUNDING

A.       Eurobiotech shall pay the costs of any further pre-clinical development
         work deemed necessary prior to commencing clinical trials, and this
         shall include the development of the Product for other therapeutic
         applications, the use of different formulations and preparations of the
         Product and oral and parenteral preclinical toxicology. The costs of
         pre-clinical development is anticipated not to exceed $1 million (one
         million U.S. dollars). Subject to funding by Eurobiotech, SRI shall
         perform the necessary pre-clinical studies whenever appropriate, unless
         agreed by both parties that the work would be more advantageously
         performed by a third party. Eurobiotech's retention of rights to
         therapeutic areas outside of cancer is contingent upon Eurobiotech
         providing funding support for development of such areas in accordance
         with the commitments of the business development plan, as indicated in
         Article 10, and as periodically reviewed and updated as agreed to by
         the parties.

B.       Eurobiotech shall pay the costs of a Phase I clinical trial of the
         Product for hematologic malignancies, to be performed at the Leukemia
         Unit at the M D Anderson Cancer Center in Houston, Texas. The costs of
         such development will not exceed $1.25 million (one million, two
         hundred and fifty thousand U.S. dollars). Both parenteral and oral
         modes of administration will be studied if warranted by commercial
         considerations and the preclinical toxicology work.

C.       Upon successful completion of Phase I clinical trials Eurobiotech shall
         pay the costs of a multi-center Phase II clinical trial of the Product
         in hematologic malignancies.

D.       Upon successful completion of Phase II clinical trials SRI and
         Eurobiotech may jointly pay the costs of Phase III clinical trials and
         further Product development. If SRI shall not jointly fund the cost of
         such trials Eurobiotech may pay the costs in full after paying a non
         refundable option fee of $750,000 within 60 days of completion and
         evaluation of Phase II trials or 60 days from the commencement of Phase
         III trials, whichever is the earlier. If the parties jointly develop
         the Product in Phase III trials no option fee shall be payable by
         Eurobiotech.

E.       Eurobiotech shall issue to SRI 100,000 shares of common stock of
         Eurobiotech Group, Inc. within 30 days of the Effective Date of this
         Agreement.

                                       5
<PAGE>

F.       Eurobiotech shall pay to SRI the sum of $750,000 upon the earlier of
         the completion of Phase III trials in Europe or the initiation of sales
         of the Product in the USA.

G.       Eurobiotech shall pay the cost of prosecuting, filing and maintaining
         patents and defending revocation proceedings on patents and patent
         applications, on the Product within the Territory.

H.       Eurobiotech shall also pay the costs as in 4G, if any, for those
         Sloan-Kettering Institute for Cancer Research ("SKI") patents which the
         Product might infringe but for the separate Agreement between SKI and
         SRI (Appendix V) which provides SRI and Eurobiotech the rights to such
         Sloan-Kettering Institute for Cancer Research patents in the Field for
         the Territory for the Product.

                                 5. ACQUISITION

         Acquisition of the Licensed Technology is meant in its broadest sense
         including assignment, transfer, sublicense, merger, joint venture and
         so on and so forth.

A.       Prior to Phase III Clinical Trials

         If all or part of the rights granted to Eurobiotech are acquired by a
         third party at, or before completion of Phase II clinical trials or
         prior to Phase III clinical trials, all current or future payments
         derived by Eurobiotech from the transfer, whether in cash, shares,
         property or any other form of payment, including but not limited to
         up-front payments, milestone payments and royalties will be divided
         equally between SRI and Eurobiotech.

B.       During or After Phase III Clinical Trials

         If Eurobiotech alone funds Phase III clinical trials, then if all or
         part of the rights are acquired by a third party during or after
         completion of Phase III trials, all current or future payments derived
         by Eurobiotech from the transfer, whether in cash, shares, property or
         any other form of payment, including but not limited to up-front
         payments and milestone payments but excluding royalties will be shared
         on the basis of 65% to Eurobiotech and 35% to SRI until 50% of the
         monies expended by Eurobiotech in conducting the Phase III trials are
         reimbursed. Thereafter, both parties shall receive 50% each of all
         payments derived form the acquisition, exclusive of royalty payments.
         Royalty payments related to the acquisition of rights by a third party
         in order to market or further sublicense Product(s) shall be divided in
         the ratio Eurobiotech 65; SRI 35.

         If a third party funds the Phase III trials either in whole or in part
         in return for rights, the parties to this Agreement shall divide all
         payments including up-front payments, milestone payments and royalties
         from that third party in equal amounts.

                                        6

<PAGE>

If the parties to this Agreement share Phase III trial costs equally, then if
all or part of the rights are acquired by a third party during or after
completion of Phase III trials, all current or future payments derived from the
acquisition will be divided equally between SRI and Eurobiotech.

C.       Manufacturing

Should Eurobiotech manufacture or have Product(s) manufactured for sale to any
unaffiliated third party acquirer such as a sublicensee or joint venture prior
to, during or after Phase III clinical trials, SRI shall receive 35% of Net
Income from such sale(s).

D.       Approval

The foregoing scenarios (articles 5A and 5B) are subject to the approval of SRI
which shall not be unreasonably withheld.

                           6. COMMERCIALIZATION STAGE

A.    Eurobiotech shall have exclusive rights to market the Product in the
      Territory under the following terms: For the Patent and Technical
      Information licenses granted herein, Eurobiotech shall pay to SRI a
      royalty of 7% of the Gross Sales Revenue of all Product(s) sold to an
      unaffiliated third party, likely to be a distributor or wholesaler, but
      not limited to such, where Eurobiotech is responsible for the marketing of
      the Product. In addition to the seven percent of Gross Sales Revenue, if
      the Gross Profit Margin from operations in any geographical area equals or
      exceeds 31% a further profit-sharing agreement will apply, according to
      the following formula and further exemplified in Appendix IV:

                  Gross Profit Margin                Payment as % of Net Income
                  -------------------                --------------------------
                   greater than 70%                              20%
                         50-70%                                  10%
                         31-49%                                   5%

B.       If the Product incorporates inventions, patents, or technical
         information that is necessary for the successful commercialization of
         the Product and that is obtained from sources other than SRI, the
         Parties agree to negotiate in good faith a new royalty rate to reflect
         the contribution of such third party inventions, patents, or technical
         information, but in no event shall the royalty rate be reduced by more
         than 50%.

C.       If this Agreement is for any reason terminated before all the earned
         royalties herein provided for have been paid, Eurobiotech shall
         immediately pay to SRI any remaining unpaid balance of earned royalties
         even though the due date provided in Article 8 has not been reached.

                                        7

<PAGE>

D.       If Eurobiotech shall sell the rights to the Technology during the
         Commercialization Stage, in combination with the sale, acquisition,
         merger or disposition of Eurobiotech Group, Inc., Eurobiotech, SRI and
         the third party(ies) shall negotiate in good faith the specific details
         for such sale of rights, subject to the approval of SRI which shall not
         be unreasonably withheld.

                                7. SUBLICENSING

A.       Eurobiotech shall have the right to sublicense in the Field for the
         Territory.

B.       Eurobiotech will keep SRI routinely updated on progress of discussions
         and negotiations with potential sublicensees. SRI shall have the right
         to review the form of sublicenses to be granted hereunder prior to the
         execution of the same by Eurobiotech. Eurobiotech agrees that
         sublicense agreements shall conform in all material respects to the
         terms and conditions of this Agreement. If SRI has not objected within
         thirty (30) days of receiving the form of such agreement describing the
         material terms, Eurobiotech may proceed to negotiate and grant
         sublicenses without further review by SRI if the form of the sublicense
         has not materially changed. Eurobiotech shall provide SRI with a copy
         of each sublicense within thirty (30) days of execution, and shall not
         grant to its sublicensees any SRI rights not conveyed by this
         Agreement.

C.       If this Agreement is terminated for any reason, except breach of
         contract by SRI, any sublicense shall automatically transfer to SRI,
         unless sublicensee is in breach or default of sublicense, and remain in
         full force and effect so long as the sublicensees performs the
         obligations of the sublicense, and Eurobiotech will execute such
         documents as may be requested by SRI to attest to the transfer to SRI
         of all sublicense rights, including the right to receive future
         payments.

                             8. PAYMENTS AND REPORTS

A.       Payments owed to SRI shall be payable within ten (10) days of receipt
         by Eurobiotech except as stated otherwise elsewhere in this Agreement
         and except for royalties and profit-sharing compensation as a result of
         direct marketing of Product by Eurobiotech.

B.       Royalties and profit-sharing compensation owed to SRI as a consequence
         of direct marketing of Product by Eurobiotech shall be due for each
         calendar quarter beginning with the first calendar quarter in which
         sales occur and shall be payable to SRI within forty-five (45) days
         following the last day of the applicable calendar quarter.

C.       All payments from Eurobiotech to SRI shall be made in U.S. dollars by
         corporate check to SRI at the address specified in Article 34 or an
         address designated in writing by SRI from time-to-time.

                                       8
<PAGE>

D.       With respect to non-dollar denominated payments owed by Eurobiotech to
         SRI, such payments shall be converted into U.S. Dollars at the
         conversion rate(s) published in The Wall Street Journal (Eastern
         Edition) as of the last business day of the calendar quarter included
         in the report.

E.       In the event that Eurobiotech is prevented from making any payment to
         SRI under this Agreement by virtue of restrictions on currency
         conversion or repatriation under the statutes, laws, codes or
         governmental regulations of the country from which the payment is to be
         made, then such payments may be paid by depositing them in the currency
         in which accrued to SRI's account in a bank acceptable to SRI in the
         country whose currency is involved. If the local currency cannot be
         converted or remitted to SRI within twelve (12) months from the initial
         deposit, Eurobiotech shall pay SRI the equivalent of such amount at the
         initially computed conversion rate (including any interest earnings) in
         United States dollars, and the local currency shall be transferred to
         an account in a bank acceptable to Eurobiotech in this country.

F.       Payments to SRI hereunder shall be deemed paid as of the day on which
         they are received at the address designated pursuant to Article 34. Any
         part of a payment which is not paid on or before the date when due
         shall accrue interest thereon from such date until the date of its
         payment in full at two (2) percentage points over the per annum
         interest rate published as the "Prime Rate" in The Wall Street Journal
         (Eastern Edition), but in no event shall such rate exceed the maximum
         rate permitted by applicable law.

G.       All foreign taxes, assessments and fees of any nature levied or
         incurred on account of all payments accruing under this Agreement will
         be assumed and paid by Eurobiotech and not deducted from payments owed
         to SRI.

H.       Eurobiotech shall deliver to SRI within forty-five (45) days after the
         end of each calendar quarter a report, certified by the chief financial
         officer (or equivalent) of Eurobiotech, setting forth in reasonable
         detail the calculation of SRI payments made during the quarter and for
         each calendar quarter, including gross sales, value added taxes, number
         of units sold, unit price and the like on a country-by-country basis by
         Eurobiotech, sublicensees, joint ventures and their affiliates.

I.       The Eurobiotech report to SRI shall be supported by and based upon a
         similar financial report or, if permitted, a copy from each sublicensee
         and other commercialization entity(ies).

J.       The parties will promptly share all information generated under the
         Co-Development Program pursuant to the confidentiality provisions of
         Article 21 and with particular respect to the pre-clinical studies and
         clinical trials. Upon commercialization of the Product(s), Eurobiotech
         shall provide SRI with quarterly updates (which may be oral unless
         other requested by SRI) in reasonable detail, describing Eurobiotech's
         plans, activities and accomplishments.

                                        9

<PAGE>

                                   9. RECORDS

Eurobiotech shall keep accurate records of all operations affecting payments
hereunder, and shall permit SRI or its duly authorized agent to inspect all such
records and to make copies of or extracts from such records during regular
business hours throughout the term of this Agreement and for a reasonable period
of not less than three (3) years thereafter. The fees charged for an SRI
authorized audit shall be paid by SRI; provided, however, that if an audit
discloses an underpayment by Eurobiotech of more than five percent (5%) for such
audited period, Eurobiotech shall pay the reasonable fees and expenses charged
by the firm conducting the audit.

                                  10. DILIGENCE

A.       In conjunction with the developmental actions and commercialization
         activities of Eurobiotech referred to throughout this Agreement, the
         parties shall prepare, within 90 days of the date of signing of this
         Agreement, a business development plan outlining the strategy, timing
         and implementation of steps to commercialize the technology.

B.       Retention of rights by Eurobiotech is contingent upon submission of a
         NDA to the FDA within four years of the effective date of this
         Agreement.

                   11. OWNERSHIP OF THE TECHNOLOGY, TECHNICAL
                          INFORMATION AND IMPROVEMENTS

A.       SRI and Eurobiotech shall each retain full ownership of their existing
         intellectual property rights including rights in the process of being
         protected and rights conceived but not yet reduced to practice as of
         the effective date of this Agreement.

B.       All Improvements by SRI developed under projects funded, in whole or in
         part, by Eurobiotech shall be owned by SRI and shall be included in the
         licenses granted in this Agreement. In the event that a conflicting
         obligation prevents SRI from including such an Improvement, SRI shall
         use reasonable efforts to assist Eurobiotech to obtain rights from the
         appropriate third party or parties.

C.       All Improvements by SRI made during the first three (3) years from the
         effective date of the Agreement and not developed under projects
         funded, in whole or in part, by Eurobiotech, shall be owned by SRI and
         if deemed reasonably necessary for Eurobiotech practice of the
         Technology, without which such practice would constitute an
         infringement of SRI's rights, shall be included to the extent
         necessary, as decided solely by SRI, in the licenses granted in this
         Agreement, unless inclusion is not possible due to SRI's obligations to
         a third party. In the event that a conflicting obligation prevents SRI
         from including such an Improvement, SRI shall use reasonable efforts to
         assist Eurobiotech to obtain rights from the appropriate third party or
         parties.

                                       10

<PAGE>

D.       Eurobiotech shall have the first right of negotiation to a license or
         other commercial arrangement to any SRI intellectual property developed
         under projects funded, in whole or in part, by Eurobiotech, which does
         not constitute an Improvement.

                             12. PATENT PROSECUTION

A.       SRI shall file, prosecute and maintain all of the Patent that are the
         property of SRI.

B.       Eurobiotech shall bear all patenting expenses related to the filing,
         prosecution or maintenance of all Patent and Improvement licensed
         hereunder in whole or in part.

C.       SRI shall furnish Eurobiotech with copies of all allowed claims when
         such claims are allowed in the Field and in the Territory for all
         Patent and Improvement licensed hereunder.

D.       SRI shall provide Eurobiotech with draft copies of all correspondence
         and filings and related prosecution documents on the Patent and
         Improvement licensed hereunder and Eurobiotech shall promptly provide
         comments, if any, to SRI. SRI shall confer with Eurobiotech, and make
         reasonable efforts to adopt Eurobiotech's suggestions regarding
         prosecution tactics and strategy. Notwithstanding the foregoing, SRI
         shall have the right to take such actions as are reasonably necessary,
         in its good faith judgement, to preserve all rights under the Patent
         and Improvement throughout the Territory. As soon as practical,
         subsequent to the filing of any prosecution document, SRI shall provide
         Eurobiotech with a copy of such document. In addition, SRI shall copy
         Eurobiotech with any official office action and SRI responses and
         submissions. Eurobiotech shall bear the expenses of the activities
         noted in this Article 14.E.

E.       SRI will inform Eurobiotech at least sixty (60) days prior to any
         decision having as a result the failure to file, or the abandonment of
         Patent applications or failure to maintain a Patent, Patents and
         Improvements licensed hereunder so that Eurobiotech may take over and
         maintain such Patent and Improvements in force.

F.       Provided that SRI has been informed by Eurobiotech at least sixty (60)
         days in advance, in the event that Eurobiotech decides not to pay
         patenting expenses in any jurisdiction, SRI may elect to maintain such
         Patent and Improvements in force and terminate Eurobiotech's licenses
         granted as for the jurisdiction in which Eurobiotech abandoned or
         failed to file or maintain such Patent rights. Notwithstanding the
         foregoing, Eurobiotech shall be obligated to pay patenting expenses
         within the European Community.

                         13. INFRINGEMENT BY THIRD PARTY

A.       Either party shall notify the other party of any suspected infringement
         by a third party of the Patent in the Field and the Territory, and each
         party shall inform the other of any evidence of such infringement(s).

                                       11

<PAGE>

B.       Eurobiotech shall have the first right to institute suit for
         infringement(s) in the Field and Territory so long as this Agreement
         remains exclusive. At Eurobiotech's expense, SRI will reasonably assist
         Eurobiotech in such prosecutions if so requested by Eurobiotech, and
         will lend its name to such actions if requested by Eurobiotech or
         required by law. Notwithstanding the foregoing SRI shall have the right
         to participate and be represented in any such prosecutions by its own
         counsel at its own expense.

C.       If SRI notifies Eurobiotech of its desire to institute suit for
         infringement(s) and Eurobiotech fails to exercise its first right to do
         so within ninety (90) days of such notice, then SRI may, at its own
         expense, bring suit or take any other appropriate action. At SRI's
         expense, Eurobiotech will reasonably assist SRI in such prosecutions if
         so requested by SRI, and will lend its name to such actions if
         requested by SRI or required by law. Notwithstanding the foregoing
         Eurobiotech shall have the right to participate and be represented in
         any such prosecutions by its own counsel at its own expense.

D.       No settlement of any suspected infringement(s), whether or not a suit
         has been instituted, may be entered into without the express written
         consent of Eurobiotech and SRI.

E.       Any amounts recovered pursuant to an infringement suit, settlement or
         otherwise shall be retained by and be the property of the party
         bringing the action. In the event Eurobiotech receives any monies or
         other consideration from a third party as a result of Eurobiotech's
         exercise of its rights under Article 13 of this Agreement, Eurobiotech
         shall first be reimbursed for expenses incurred and paid for, SRI shall
         then receive a portion of the remainder in accordance with the
         applicable provision(s) of Article 6 as applied to all such monies or
         other considerations whether such monies or other considerations are
         denoted as "royalties," "damages," "releases" from prior acts, or any
         other designation.

F.       If Eurobiotech fails to exercise its first right to institute suit for
         infringement(s) and SRI elects not to institute suit, then SRI shall
         provide Eurobiotech with at least sixty (60) days notice of its
         intention to terminate Eurobiotech's licenses granted in those
         jurisdictions affected by the infringement or to take any other action
         it sees fit in its best judgement.

                           14. REVOCATION PROCEEDINGS

A.       In the event either party becomes aware of the institution by a third
         party of any proceedings for the revocation of any Patent, patents or
         Improvements in any country in the Territory licensed hereunder to
         Eurobiotech, such party shall notify the other party promptly.
         Eurobiotech shall defend any such proceedings at its own expense, in
         its own name.

B.       SRI shall have the right to participate in such revocation proceedings
         at Eurobiotech's expense, and will lend its name to such proceedings if
         requested by Eurobiotech or required by law. Sublicensees of
         Eurobiotech shall also have the right to participate in such revocation
         proceedings.

                                       12

<PAGE>

C.       Settlement of any revocation proceedings shall be subject to the
         approval of SRI; such approval shall not be unreasonably withheld.

                     15. INFRINGEMENT OF THIRD PARTY RIGHTS

A.       SRI "does not warrant" as stated in Article 17. Disclaimer, "that the
         patents will be free from claims of infringement by third parties or
         any other rights of third parties."

B.       Eurobiotech as stipulated in Article 18. Indemnification, "agrees to
         indemnify, hold harmless and defend SRI... from and against any and
         all demands, claims, suits, and actions ..." which includes
         infringement of third party rights.

C.       SRI will reasonably assist Eurobiotech to defend or settle such third
         party claim if so requested and at the expense of Eurobiotech.

D.       SRI shall have the right to participate and be represented in any such
         claim by a third party by its own counsel.

E.       No settlement of any third party claim may be entered into without the
         express written consent of SRI.

F.       In the event, by way of counterclaim or otherwise, either party or both
         parties recover any damages or other sums in any action, suit, or
         proceeding involving a claim by a third party, or in settlement
         thereof, such recovery shall be applied and shared as mutually agreed.

                               16. REPRESENTATIONS

A.       This Agreement is entered into by SRI in its corporate capacity. It is
         understood and agreed that the U.S. Government is not a party to this
         Agreement and in no manner whatsoever shall be liable for or assume any
         responsibility or obligation for any claim, cost, or damages arising
         out of or resulting from this Agreement or the subject matter licensed.

B.       Nothing in this Agreement shall be deemed to be a representation or
         warranty by SRI, or the U.S. Government, of the safety, merchantability
         or usefulness for any purpose, of any technical information, techniques
         or practices at any time made available by SRI to Eurobiotech
         hereunder.

C.       SRI represents that it has the right to grant all of the rights herein,
         except for a non-exclusive, non-royalty bearing, non-commercial license
         to the Government of The United States of America.

                                       13

<PAGE>

D.       SRI is unaware of any claims asserted against SRI by any third parties
         with respect to Patent infringement or any other type of liability
         relevant to licensing of the Inventions, which have not been disclosed
         to Eurobiotech as of the Effective Date of this Agreement.

E.       SRI represents that it has full power, authority and legal right to
         enter into this contemplated Agreement and to consummate the
         transactions contemplated therein.

F.       Eurobiotech represents that it has full power, authority and legal
         right to enter into this contemplated Agreement and to consummate the
         transactions contemplated therein.

G.       Eurobiotech shall accept liability for or on account of any injury,
         loss or damage, of any kind or nature sustained by, or any damage
         assessed or asserted against, or any other liability incurred by or
         imposed upon either party arising out of or in connection with or
         resulting from (i) the production, use or sale of any Product or (ii)
         the use of any technical information, techniques, or practices
         disclosed by either party, or (iii) any advertising or other
         promotional activities with respect to any of the foregoing. If a
         sublicense is granted by Eurobiotech to a third party that third party
         shall accept all liability for any injury, loss or damage as defined
         above.

                                 17. DISCLAIMER

EXCEPT AS EXPRESSLY SET FORTH IN ARTICLE 16, SRI DOES NOT MAKE ANY EXPRESS OR
IMPLIED WARRANTIES, STATUTORY OR OTHERWISE, CONCERNING THE TECHNOLOGY OR ANY
TECHNICAL INFORMATION COMMUNICATED TO EUROBIOTECH BY SRI. SPECIFICALLY, BUT
WITHOUT LIMITING THE FOREGOING, SRI MAKES NO EXPRESS OR IMPLIED WARRANTY OF
MERCHANTABILITY, FITNESS (FOR A PARTICULAR PURPOSE OR OTHERWISE), QUALITY OR
USEFULNESS OF THE TECHNOLOGY. ALL PHYSICAL EMBODIMENTS OF THE TECHNOLOGY
PROVIDED BY SRI HEREUNDER ARE PROVIDED ON AN "AS IS" BASIS. SRI DOES NOT WARRANT
THE ACCURACY OF ANY INFORMATION INCLUDED WITHIN THE TECHNICAL INFORMATION NOR
DOES SRI WARRANT THAT ANY SUCH INFORMATION CONSTITUTES TRADE SECRETS OR
CONFIDENTIAL INFORMATION OR THAT THE PATENTS WILL BE FREE FROM CLAIMS OF
INFRINGEMENT BY THIRD PARTIES OR ANY OTHER RIGHTS OF THIRD PARTIES.

UNDER NO CIRCUMSTANCES SHALL EITHER PARTY BE LIABLE TO THE OTHER PARTY OR ANY
THIRD PARTY FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES IN TORT, CONTRACT,
STRICT LIABILITY OR OTHERWISE INCURRED BY OTHER PARTY OR ANY THIRD PARTY.

                               18. INDEMNIFICATION

      Eurobiotech hereby agrees to indemnify, hold harmless and defend SRI and
SKI and its officers, directors, representatives, agents and employees from and
against any and all demands, claims, suits or actions of any character presented
or brought on account of any injuries, losses or damages sustained by any person
or property in consequence of (i) any act or omission of Eurobiotech or its
agents, employees or subcontractors, or (ii) any liability under Article 16G,
except for any injuries, losses or damages that specifically result from the
negligence or willful misconduct of SRI or SKI. The foregoing indemnity shall
include but not be limited to court costs, attorneys' fees, costs of
investigation and costs of defense associated with such demands, claims, suits
or actions.

                                       14
<PAGE>

                                  19. INSURANCE

      Eurobiotech shall maintain, during the term of this Agreement, reasonable
amounts of comprehensive general liability insurance, including products
liability insurance, with reputable and financially secure insurance carriers to
cover the activities of Eurobiotech, its affiliates and sublicensees hereunder.
Such insurance shall be written to cover claims incurred, discovered,
manifested, or made during or beyond the expiration or termination of this
Agreement during the period that any product, process, or service, relating to,
or developed pursuant to, this Agreement is being, commercially distributed or
sold by Eurobiotech or by a sublicensee, affiliate or agent of Eurobiotech.
Such insurance shall include SRI as an additional insured. Eurobiotech shall
furnish to SRI a certificate of insurance evidencing such coverage and
periodically, upon request, provide evidence that the coverage is still in
effect.

                            20. TERM AND TERMINATION

A.       This Agreement shall commence on the Effective Date and, unless sooner
         terminated under this Article 20, shall expire upon the later of: (i)
         expiration of the last to expire of all Patent(s), Improvement(s), and
         Patent(s) licensed under this Agreement [hereafter "Licensed Patents"
         only for Article 20], including any extensions thereof and any periods
         of exclusivity granted by regulatory agencies or other governmental
         bodies; (ii) Eurobiotech is no longer due any payments from
         Sublicensee(s); or (iii) Eurobiotech is no longer directly marketing a
         Product.

B.       The payment obligations under the licenses granted to Eurobiotech for
         Licensed Patents and Technical Information shall continue throughout
         the term as defined in Article 20.A but would be subject to good faith
         renegotiations upon the expiration of the last to expire of the
         Licensed Patents, or upon the abandonment of the last to be abandoned
         of any patent applications if no patents have been issued, whichever is
         the later, unless this Agreement is sooner terminated. Such good faith
         renegotiations shall take into account on a country-by-country or
         regional basis but not be limited to: (i) Product competition; (ii)
         utilization, incorporation and value of Technical Information; (iii)
         value of Technical Information if no longer confidential or proprietary
         through no fault of Eurobiotech, its Sublicensee(s), contractors,
         financiers or any other Eurobiotech agent(s) or purchasers of Product
         or services having access to Technical Information; (iv) the applicable
         contract or patent law or (v) prior payment commitments such as in
         Article 3.C(2).

                                       15

<PAGE>

C.       Eurobiotech may terminate this Agreement at any time upon ninety (90)
         days written notice to SRI and upon payment of all amounts due SRI
         through the effective date of the termination.

D.       Upon termination of this Agreement, neither party shall be released
         from any obligation that matured prior to the effective date of such
         termination. Eurobiotech and any sublicensee may, however, after the
         effective date of such termination, sell all Products in inventory
         provided that Eurobiotech shall pay to SRI the royalties and
         profit-sharing thereon as required by Article 6 hereof and submit the
         reports required by Article 8 hereof.

E.       Except as provided in Article 13F above, if either party shall be in
         default of any obligation hereunder, the other party may terminate this
         Agreement by giving Notice of Termination by Certified or Registered
         Mail to the party at fault, specifying the basis for termination. If
         within sixty (60) days after the receipt of such Notice of Termination,
         the party in default shall remedy the condition forming the basis for
         termination such Notice of Termination shall cease to be operative, and
         this Agreement shall continue in full force.

F.       SRI shall have the right to terminate this Agreement if Eurobiotech
         shall cease to carry out its business, become bankrupt or insolvent,
         apply for or consent to the appointment of a trustee, receiver or
         liquidator of its assets or seek relief under any law for the aid of
         debtors, or if Eurobiotech fails to submit an NDA as provided in
         Article 10B.

G.       Eurobiotech shall inform SRI of its intention to file a voluntary
         petition in bankruptcy or of another's intention to file an involuntary
         petition in bankruptcy to be received at least thirty (30) days prior
         to filing such a petition. Eurobiotech's filing without conforming to
         this requirement shall be deemed a material, pro-petition incurable
         breach not subject to the Notice requirement of Paragraph 20.

H.       Notwithstanding anything else in this Agreement to the contrary, the
         parties agree that Eurobiotech's obligation to pay SRI any payments or
         other consideration accrued but unpaid prior to termination shall
         survive the termination of this Agreement. In addition, Articles 5, 6,
         8, 9, 17, 18, 19, 21, 22, 28 and 34 as well as any other provisions to
         the extent required for the full observation and performance of the
         foregoing Articles or which by their nature are intended to survive
         such termination, shall survive the termination of this Agreement and
         continue to be enforceable.

                   21. CONFIDENTIALITY; PUBLICATION; PUBLICITY

A.       In fulfilling their obligations under this Agreement, it may be
         desirable or necessary for the parties to disclose to one another
         certain of their Confidential Information. In the event of receipt of
         such Confidential Information, the receiving party agrees to preserve
         such information as confidential and not to disclose it to third
         parties or to use it except in connection with this Agreement during
         the term of this Agreement and for a period of five (5) years following
         its termination. The foregoing obligations shall not apply to any
         information that:

                                       16

<PAGE>

         1.       is now in the public domain or becomes generally available to
                  the public through no fault of the receiving party;

         2.       is already known to, or in the possession of, the receiving
                  party as can be demonstrated by documentary evidence;

         3.       is disclosed to the receiving party on a nonconfidential basis
                  by a third party having the right to make such disclosure; or

         4.       is independently developed by the receiving party as can be
                  demonstrated by documentary evidence.

         For the purposes of the preceding portion of this Section A, Article 21
         only. "parties" or "party" but not "third parties" or "third party" may
         also include SKI.

         In addition, to the extent reasonably necessary to fulfill its
         obligations or exercise its rights under this Agreement (i) a party may
         disclose Confidential Information to its Affiliates, Sublicensees,
         consultants, outside contractors and clinical investigators, on a
         need-to-know basis on condition that such persons or entities agree to
         be bound by the provisions of this Article 20, (ii) a party or its
         Affiliates or Sublicensees may disclose Confidential Information to
         governmental or other regulatory authorities to the extent that such
         disclosure is reasonably necessary to obtain patents or regulatory
         authorizations, provided the disclosing party shall request
         confidential treatment thereof, and (iii) a party may disclose
         Confidential Information as required by applicable law, regulation or
         judicial process, provided that such party shall give the other party
         (x) prior written notice thereof, (y) adequate opportunity to object to
         any such disclosure or to request confidential treatment thereof, and
         (z) shall take all steps reasonably possible to minimize the disclosure
         to that level mandated by law.

B.       (i)      If either party desires to publish or present the results of
                  the Co-Development Program, the publishing/presenting party
                  shall provide the non-publishing/non-presenting party a copy
                  of the manuscript of any proposed publication or presentation.
                  The non-publishing/non-presenting party shall then have thirty
                  (30) days to review and comment on the manuscript or
                  presentation, and the publishing/presenting party agrees to
                  delete any information identified by the
                  non-publishing/non-presenting party as its Trade Secrets or
                  Confidential Information.

         (ii)     In the event the non-publishing/non-presenting party
                  determines that a Patent application covering information
                  contained in the proposed publication or presentation should
                  be filed, the party proposing the publication or presentation
                  shall delay such publication or presentation for up to sixty
                  (60) days to allow such filing to be made.

                                       17
<PAGE>

C.       Each party shall provide the other party with the prior opportunity to
         review and approve any press releases or similar public announcements
         concerning this Agreement or clinical, regulatory and commercial
         developments related to Products as soon as practicable, but in no
         event later than 24 hours before an announcement is made. Eurobiotech
         shall not use the name of SRI or otherwise refer to any organization
         related to SRI, except with the written approval of SRI, such approval
         not to be unreasonably withheld.

                             22. DISPUTE RESOLUTION

A.       The parties shall attempt to resolve through good faith discussions any
         dispute which arises under this Agreement. Any dispute may, at the
         election of either party, be referred to the chief executive officers,
         or the equivalent, of each party. If they are unable to resolve the
         dispute, within thirty (30) days after delivery of written notice of
         the dispute from one party to the other, either party may seek to
         resolve it by initiating Alternative Dispute Resolution ("ADR") at the
         geographical location of the noninitiating party in which the Judicial
         Arbitration and Mediation Services ("JAMS") of such location, through
         a panel of three (3) arbitrators (the "Arbitrators"), shall control the
         proceedings as provided herein. If JAMS is not in existence at the time
         of such dispute, the American Arbitration Association, of such location
         shall be substituted.

B.       An ADR shall be initiated by a party by sending written notice thereof
         to the other party and JAMS, which notice shall state the issues to be
         resolved. Within ten (10) business days after receipt of such notice,
         the other party may, by sending written notice to the initiating party
         and JAMS, add issues to be resolved. Within twenty (20) business days
         after the date of the original ADR notice, JAMS shall nominate to the
         parties at least ten (10) qualified nominees from JAMS' panel. Each
         party shall have five (5) business days after the receipt of such
         nominations to select one Arbitrator. The two (2) Arbitrators so
         selected shall mutually agree on a third arbitrator to complete the
         panel.

C.       Each Arbitrator shall have experience in the Field relevant to the
         dispute and in intellectual property law matters. In the event of a
         dispute between the parties relating to the calculation of any
         royalties or the amount of other consideration payable under this
         Agreement (including without limitation, the results of any audit
         conducted on behalf of a party pursuant to Article 9), then, in
         addition to the procedure set forth above and in Article 22B, the
         Arbitrators shall be partners or full members of an internationally
         recognized certified public accounting firm which is not an auditing
         firm for either party and has not provided material services to either
         party during the last two (2) year period prior to the date of ADR
         initiation.

D.       Except as otherwise provided in this Article 22, such hearing shall be
         conducted pursuant to the JAMS Rules or the Commercial Arbitration
         Rules of the American Arbitration Association (AAA) as applicable.

                                       18

<PAGE>

E.       The Arbitrators shall render a disposition on the proposed rulings as
         expeditiously as possible after the hearing, but not later than fifteen
         (15) business days after the conclusion of the hearing. In the
         circumstances where the Arbitrators rule for a party on a claim in the
         form of a claim for monetary damages, the parties will then submit a
         proposed remedy within ten (10) days of notice of the ruling. The
         proposed remedy may be accompanied by a brief in support of the remedy
         not to exceed five (5) pages. The Arbitrators will rule on the proposed
         remedies within ten (10) days of their submission. The Arbitrators'
         disposition shall be final and not appealable, except that either party
         shall have the right to appeal such disposition on the basis it was
         affected by fraud or bad faith in connection with the ADR proceedings.
         A judgment on the Arbitrators' disposition may be entered in any court
         having jurisdiction over the parties. The reasonable fees and expenses
         of the Arbitrators, as well as the standard charges of JAMS for its
         assistance, shall be borne equally by the parties or as they may
         otherwise agree.

F.       A party shall not be prohibited from bringing a claim for resolution
         under this Article 22 on the ground that the claim could have been
         brought during an earlier proceeding under this same Article.

G.       The following disputes, causes of action or claims shall not be subject
         to the dispute resolution process set forth in this Article 22:

         (i)      a claim arising from a suit, action, or proceeding brought by
                  a third party or Sublicensee not subject to ADR;

         (ii)     a claim relating to undisputed amounts owed by either party to
                  the other under this Agreement;

         (iii)    a suit, action, or proceeding to compel either party to comply
                  with the dispute resolution procedures set forth in this
                  Article 22;

         (iv)     a dispute, controversy, or claim relating to the scope,
                  enforceability, infringement or validity of a patent or
                  trademark of either party; and

         (v)      a cause of action seeking temporary or preliminary injunction
                  relief.

                                23. ASSIGNABILITY

A.       Eurobiotech shall not assign any rights under this Agreement not
         specifically transferable by its terms without prior written consent of
         SRI. SRI may not assign its rights hereunder without the prior written
         consent of Eurobiotech.

B.       In the event of a Change of Control (as defined below) of Eurobiotech,
         SRI may elect, upon not less than sixty (60) days written notice
         following the Change of Control or receipt of notice provided pursuant
         to Article 23.C, to terminate this Agreement if such Change of Control
         is not, in the good faith judgement of SRI, in the developmental and/or
         commercial interest of the Licensed Technology or significantly limits
         its applicability or scope.

                                       19
<PAGE>

C.       For purposes of this Article 23C, "Change of Control" shall be deemed
         to have taken place if (a) a third party, including a "group" as
         defined in section 13(d)(3) of the Securities Exchange Act of 1934 but
         excluding the current directors of Eurobiotech, becomes the beneficial
         owner of shares having fifty percent (50%) or more of the total number
         of votes that may be cast for the election of directors of Eurobiotech;
         or (b) as the result of, or in connection with, any cash tender or
         exchange offer, merger or other business combination, sale of assets or
         contested election, or any combination of the foregoing transactions (a
         "Transaction"), (X) the persons who were directors of Eurobiotech
         before the Transaction shall cease to constitute a majority of the
         Board of Directors of Eurobiotech or any successor to Eurobiotech, or
         (Y) there is the sale, exchange of other disposition of all or
         substantially all of Eurobiotech's assets to a third party. Within
         thirty (30) days following a Change of Control of Eurobiotech,
         Eurobiotech shall provide notice thereof to SRI.

                                   24. REFORM

A.       The parties agree that if any part, form, or provision of this
         Agreement shall be found illegal or in conflict with any valid
         controlling law, the validity of the remaining provisions shall not be
         affected thereby.

B.       In the event the legality of any provision of this Agreement is brought
         into question because of a decision by a court of competent
         jurisdiction of any country in which this Agreement applies, SRI, by
         written notice to Eurobiotech, may revise the provision in question or
         may delete it entirely so as to comply with the decision of the said
         court.

                            25. WAIVER AND ALTERATION

A.       The failure of either party to insist, in any one or more instances,
         upon the performance of any of the terms, covenants or conditions of
         this Agreement and to exercise any right hereunder, shall not be
         construed as a waiver or relinquishment of the future performance of
         any such term, covenant or condition or the future exercise of such
         right, but the obligations of the other party with respect to such
         future performance shall continue in full force and effect.

B.       A provision of this Agreement may be altered only by a writing signed
         by both parties, except as provided by Article 24, above.

                                   26. MARKING

A.       Eurobiotech shall place in a conspicuous location on any product or its
         packaging, which is made or sold under any Patent coming within this
         Agreement, a patent notice in accordance with the laws concerning the
         marking of patented articles.

                                       20

<PAGE>

B.       Eurobiotech shall include a marking provision similar to Paragraph A
         above in every sublicense granted pursuant to Article 7 above.

                               27. IMPLEMENTATION

Each party shall execute any instruments reasonably believed by the other party
to be necessary to implement the provisions of this Agreement.

                                28. GOVERNING LAW

This Agreement shall be deemed to have been entered into and shall be governed
by, construed and enforced in accordance with laws of the State of Alabama of
the United States of America and in the English language, and any action brought
to enforce any provision or obligation hereunder shall be brought in a court of
competent jurisdiction in the State of Alabama.

                    29. EXPORTATION OF TECHNICAL INFORMATION

Eurobiotech agrees not to export from The United States of America, directly or
indirectly, any Technical Information furnished to Eurobiotech either directly
or indirectly by SRI, except to the extent and to the countries permitted by the
laws of The United States of America. Eurobiotech agrees to indemnify, defend
and hold harmless SRI, its officers, agents and employees from all liability
involving the violation of such export regulations, either directly or
indirectly by Eurobiotech.

                                  30. HEADINGS

The headings of the articles, sections and paragraphs used in this Agreement are
included for convenience only and are not to be used in construing or
interpreting this Agreement.

                             31. PARTIES INDEPENDENT

In making and performing this Agreement, the parties act and shall act at all
times as independent entities and nothing contained in this Agreement shall be
construed or implied to create an agency, partnership or employer and employee
relationship between Eurobiotech and SRI. Except as specifically provided
herein, at no time shall either party make commitments or incur any charges or
expenses for or in the name of the other party.

                                32. COUNTERPARTS

This Agreement shall become binding when any one or more counterparts hereof,
individually or taken together, shall bear the signatures of each of the parties
hereto. This Agreement may be executed in any number of counterparts, each of
which shall be an original as against either party whose signature appears
thereon, but all of which together shall constitute but one and the same
instrument.

                                       21

<PAGE>

                                33. FORCE MATEURE

The parties shall not be responsible for failure to perform any of the
obligations imposed by this Agreement (except an obligation to pay money),
provided such failure is caused by fire, storms, floods, strikes, lockouts,
accidents, war, riots or civil commotions, inability to obtain railroad cars or
raw materials, embargoes, any State or Federal regulation, law, or restriction,
seizure or acquisition of the Technology or the Product(s) by the Government of
the United States or of any state, or of any agency thereof or by reason of any
compliance with a demand or request for such Product for any purpose for
national defense, or any other cause or contingency beyond the reasonable
control of said party (whether or not of the same kind or nature as the causes
or contingencies above enumerated) shall not subject the party so failing to any
liability to the other.

                                   34. NOTICE

For the purpose of all written communications between the parties, their
addresses shall be:

If to EUROBIOTECH:                          If to SRI:

Address:                                    Address:
            -----------------------------              -------------------------

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

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

Attention:                                  Attention:
            -----------------------------              -------------------------

Telephone:                                  Telephone:
            -----------------------------              -------------------------

FAX:                                        FAX:
            -----------------------------              -------------------------

or any other addresses of which either party shall notify the other party in
writing.

                                       22
<PAGE>

                                  35. EXECUTION

         IN WITNESS WHEREOF the parties have caused this Agreement to be
executed by their duly authorized officers on the respective dates and at the
respective places hereinafter set forth.

EUROBIOTECH:                        SRI:

By:            /s/ CB Wood          By:              /s/ G.E. Dwyer
            ----------------------             ---------------------------

Print Name:        CB Wood          Print Name:          G.E. Dwyer
            ----------------------             ---------------------------

Its:                 CEO            Its:            President and CEO
            ----------------------             ---------------------------

Date:            19th Aug 98        Date:                 9/1/98
            ----------------------             ---------------------------

                                       23

<PAGE>

                                   APPENDIX I

<TABLE>
<CAPTION>
                                          Filing                                                        Expiration
     Country             Serial No.       Date          Priority          Patent No.        Issued      Date
<S>                   <C>                 <C>           <C>               <C>                <C>        <C>
 United States        07/355,358          5/23/89       5/23/89             5,034,518          7/23/91    7/23/2008
 United States        07/693,646          5/10/91       5/23/89             5,384,310          1/24/95    7/23/2008
                                                        & 5/10/91
 United States        08/320,879          9/21/94       5/10/91             5,661,136          8/26/97    8/26/2014
 European             90909080.5          5/23/90       5/23/89 U.S.        0473708
   France                                                                   0473708            1/15/97    5/23/2010
   Germany                                                                  0473708            1/25/97    5/23/2010
   Great Britain                                                            0473708            1/15/97    5/23/2010
   Italy                                                                    0473708            1/25/97    5/23/2010
   Netherlands                                                              0473708            1/25/97    5/23/2010
   Spain                                                                    0473708            1/25/97    5/23/2010
   Sweden                                                                   90909080.5         1/15/97    5/23/2010
   Switzerland                                                              0473708            1/25/97    5/23/2010
 European             92912163.0          5/7/92        5/23/89 U.S.        (Substantive (first) examination
   Austria                                              & 5/10/91 U.S.      report received; Claims equivalent
   Belgium                                                                  to U.S. 07/693,646
   Germany
   Greece
   France
   Italy
   Luxembourg
   Monaco
   Netherlands
   Spain
   Sweden
   Switzerland
   United Kingdom
 Japan                2-508789            5/23/90       5/23/89 U.S.       (Request for examination filed 5/23/97;
                                                                           case expected to be taken up for
                                                                           examination about 5/99; Claims
                                                                           equivalent to U.S. 07/355,358)
 Japan                500121/1993         5/7/92        5/23/89 U.S.       (Request for examination must be filed
                                                        & 5/10/91 U.S.     prior to 5/7/99; Claims equivalent to
                                                                           U.S. 07/693,646)

 Canada               2,102,782           5/7/92        5/7/90             (Request for examination must be filed
                                                                           prior to 5/7/99; Claims equivalent to
                                                                           U.S. 07/693,646)
</TABLE>

<PAGE>

                                   APPENDIX II

<PAGE>

                Terms for Eurobiotech Group, Inc. ("Eurobiotech")
                  and Southern Research Institute ("Southern")
                            Co-Development Agreement

Scope

         Co-develop Product(s) based on Southern's patented and patent-pending
2'-fluoro-2-halo substituted purine nucleoside technology.

Product(s)

         Drugs effective against hematologic malignancies and solid tumors as
well as other therapeutic indications, such as (but not exclusively) skin
disorders and transplantation immunity. All modes of administration,
particularly oral and iv., are included in these terms as are specialized
formulations such as those imparting controlled-release characteristics.

Agreement

         The parties hereby agree to enter into good faith discussions, based on
the terms agreed to in this document, for the exclusive co-development,
exclusive world-wide commercial rights except for Japan and Southeast Asia, to
the Product(s) and all therapeutic indications and all modes of administration
of the 2'-fluoro-2-halo substituted purine nucleoside technology.

Preclinical Development

         Funding provided by Eurobiotech not to exceed US$1 million for
parenteral and oral preclinical toxicology, oral formulation, and other
preclinical work needed prior to commencing clinical trials including
development funds to explore other therapeutic indications.

Drug Synthesis for Preclinical and Phase I

         Discussions for the definitive Agreement will include the possible role
of Southern in the supply of material and production of GMP and non-GMP
Product(s).

Preclinical Toxicology

         To be performed by Southern whenever appropriate at a price to be
negotiated. This agreement takes full account of the initial preparations for
preclinical toxicology studies conducted and planned by the MD Anderson group.

                                        1

<PAGE>

Phase I

         Funding provided by Eurobiotech not to exceed US$1.25 million for Phase
I clinical trials to be performed at the M. D. Anderson Cancer Center in
Houston, Texas, for hematologic malignancies. Eurobiotech to further fund the
preclinical and, if indicated, the clinical development for other therapeutic
indications including, but not limited to, solid tumors, skin disorders and
transplantation immunity.

Phase II

         Eurobiotech to fund the multi-center Phase II clinical trials of the
2'-fluoro-2-halo substituted purine nucleoside in hematologic malignancies. A
decision to proceed or not will be made prior to or at the time when USS1.25
million has been expended. Eurobiotech's rights to hematologic malignancies will
revert to Southern if the decision is not to proceed. Retention of rights to
other therapeutic indications is contingent upon adequate levels of funding to
be provided by Eurobiotech for fast-track preclinical and clinical development.

NDA After Phase II

         An NDA or equivalent document may be submitted to the FDA and/or
foreign regulatory agencies if the results after completion of Phase II trials
are encouraging and the agencies appear receptive.

Phase III

         If Eurobiotech decides not to proceed after completion of Phase II
trials, the rights to the technology will revert to Southern. If Southern
decides not to proceed with the codevelopment program (i.e., equal sharing of
phase III costs) after completion of Phase II trials, Eurobiotech shall have the
right to conduct the Phase III trials after paying a nonrefundable option fee of
$750,000 within 60 days of completion and evaluation of Phase II trials or 60
days from the commencement of Phase III trials, whichever is the earlier. If
Southern decides to proceed with the co-development program, if Phase II trials
are successful, and the parties decide to proceed with Phase III clinical
trials, the costs incurred will be shared equally between Southern and
Eurobiotech. In that case, there will be no option fee for commencing Phase III
trials.

                                        2
<PAGE>

Intellectual Property Ownership

         Southern and Eurobiotech shall each retain full ownership of their
existing intellectual property rights.

Additional Intellectual Property

         Ownership shall be linked directly to inventorship. Eurobiotech shall
have the first right of negotiation to any additional intellectual property
developed as a result of this codevelopment program.

Additional Compensation to Southern

         100,000 Shares of common stock of Eurobiotech; $750,000 milestone
payment on completion of Phase III trials in Europe or the first sales of
Product(s) in the USA, whichever is the earlier; payment of patent costs from
the effective date of the definitive co-development Agreement for Southern and
Sloan Kettering Institute.

Acquisition of Rights by Third Party (Non-Marketing by Eurobiotech)

         If all or part of the rights granted to Eurobiotech are acquired by a
third party at, or before completion of Phase II clinical trials or prior to
Phase III clinical trials, all current or future payments derived by Eurobiotech
from the transfer, whether in cash, shares, property or the like, including but
not limited to up-front payments, milestone payments and royalties will be
divided equally between Southern and Eurobiotech.

         If Eurobiotech alone funds Phase III clinical trials, then if all or
part of the rights are acquired by a third party during or after completion of
Phase III trials, all current or future payments derived by Eurobiotech from the
transfer, whether in cash, shares, property or the like, including but not
limited to up-front payments and milestone payments but excluding royalties will
be shared on the basis of 65% to Eurobiotech and 35% to Southern until 50% of
the monies expended by Eurobiotech in conducting the Phase III trials are
reimbursed. Thereafter, both parties shall receive 50% each of all payments
derived from the transfer, exclusive of royalty payments. Royalty payments
related to the transfer or sublicense of the rights to market or further
sublicense Product(s) shall be divided in the ratio Eurobiotech 65; Southern 35.

         If a third party funds the Phase III trials either in whole or in part
in return for rights, the parties to this Agreement shall divide all payments
including up-front payments, milestone payments and royalties from that third
party in equal amounts.

         If the parties to this Agreement share Phase III trial costs equally,
then if all or part of the rights are acquired by a third party at, or before,
or after completion of Phase III trials, all payments derived from the
acquisition will be divided equally between Southern and Eurobiotech.

                                       3
<PAGE>

         All of the foregoing scenarios are subject to the approval of Southern
which shall not be unreasonably withheld.

         As part of the co-development program, should Eurobiotech directly
manufacture Product(s) for sale to a third party, Southern and Eurobiotech shall
agree that net income from such sales shall be divided in the ratio Eurobiotech
65:Southern 35.

Marketing by Eurobiotech

         If products based on the 2'-fluoro-2-halo substituted purine
nucleosides are brought to market for the treatment of hematologic malignancies
and/or other therapeutic indications, Eurobiotech agrees to use all reasonable
measures to market the products and to provide a sales force sufficient to
properly support sales of the Product(s) in designated markets.

         A.       Phase III Funded by Eurobiotech

         Eurobiotech will pay Southern a 7% royalty payment on gross sales
revenue on products related to the 2'-fluoro-2-halo substituted purine
nucleoside technology, applicable in all geographic areas where Eurobiotech is
responsible for the marketing of the Product(s).

         If the gross profit margin from opertions in any geographical area
exceeds 30% a further profit-sharing agreement will apply, in addition to the
above royalty payment, according to the following formula:

          Gross Profit Margin                 Payment as % of net income*
          -------------------                 ---------------------------
               > 70%                                       20%
              50-70%                                       10%
              31-49%                                        5%

*net income to include total revenues but not include local sales tax and
corporate income taxes.

         If a sublicense is granted to third parties to sell Product(s) in
specified geographical regions, Southern shall receive 35% of all current and
future payments obtained by Eurobiotech from the third parties including 35% of
all royalty payments made by the third parties.

                                       4

<PAGE>

         B.       Regulatory License Granted After Phase II Clinical Trials

         If regulatory approval is obtained after completion of Phase II trials,
Eurobiotech shall pay Southern according to the terms of section A above.

         C.       Phase III Trial Cost Reimbursed

         If a third party reimburses the costs of a Phase III clinical trial in
exchange for a transfer or sublicense of rights, Eurobiotech shall pay Southern
for its marketing of Product(s) based on the terms of section A above, but all
payments from such a sublicensee, including up-front, milestone and royalty
payments shall be divided equally between the parties to this Agreement.

Disposition of Eurobiotech Rights

         Sale or acquisition of Eurobiotech's rights to this technology in whole
or in part and whether or not in combination with the sale, acquisition, merger
or disposition of Eurobiotech shall be on the general basis of Eurobiotech 65:
Southern 35 except as otherwise specified in the Agreement with the specific
details to be negotiated in good faith and subject to the approval of Southern
which shall not be unreasonably withheld.

Payment Duration

         Southern payments continue as long as Eurobiotech's, subject to good
faith negotiations regarding the impact of patent expirations, non-patent
countries, competition, infringement, know-how and other issues.

Foreign Taxes

         Payments to Southern shall be made through Eurobiotech U.S.A. and will
not include deductions for foreign taxes (which not-for-profit U.S. corporations
have no means of crediting or offsetting).

Due Diligence

         Upon the definitive Agreement being signed the two parties shall
prepare, within 90 days of the date of signing, a business development plan
outlining the strategy, timing and implementation of steps to commercialize the
technology. Retention of rights by Eurobiotech is contingent upon submission of
a NDA to the FDA within four years of the effective date of the definitive
Agreement.

                                        5

<PAGE>

Sloan-Kettering Institute

         It is agreed that Southern shall be responsible for obtaining
authorization and agreement from Memorial Sloan Kettering Institute in order to
fully carry out its obligations under the terms of the definitive Agreement.

Authority

         Southern has full power, authority and legal right to enter into this
contemplated Agreement and to consummate the transactions contemplated hereby.

         Eurobiotech has full power, authority and legal right to enter into
this contemplated Agreement and to consummate the transactions contemplated
hereby.

Signed on behalf of Southern                 Signed on behalf of Eurobiotech

         /s/                                           /s/ C.B. Wood
---------------------------------            -----------------------------------

     Chief Executive Officer                               Chairman
---------------------------------            -----------------------------------
Position                                     Position

         Sept. 22, 1997                                    29/9/97
---------------------------------            -----------------------------------
Date                                         Date

                                       6
<PAGE>

                                  APPENDIX III

<PAGE>

                 Extension of the Co-Development Program between
            Southern Research Institute and Eurobiotech Group, Inc.

WHEREAS Southern Research Institute ("SRI") and Eurobiotech Group, Inc.
("Eurobiotech") have entered into an Agreement dated 8/31/98 to co-develop
2'-fluoro-2-halo substituted purine nucleoside(s) for the treatment of
hematological malignancies, other cancers and other therapeutic indications, and

WHEREAS both parties wish to further specify additional financial as well as
research and development obligations of Eurobiotech,

NOW, THEREFORE, to consummate such extensions to the Co-Development Program by
Eurobiotech, the parties agree as follows:

l.       INITIAL PAYMENT

         Eurobiotech agrees to pay SRI a total of $50,000 as an initial,
         once-only payment within ten (10) days of the signing of the
         Co-Development Agreement to codevelop 2'-fluoro-2-halo substituted
         purine nucleoside(s).

2.       RESEARCH AND DEVELOPMENT PAYMENTS

         Eurobiotech agrees to pay SRI a further $50,000 within 90 days of
         signing the Co-Development Agreement to be used for research and
         development to be conducted at SRI's laboratories with respect to the
         use of 2'-fluoro-2-halo substituted purine nucleoside(s) for
         therapeutic indications other than cancer. The research and development
         program will be mutually agreed upon by the parties and funding will
         begin no later than thirty (30) days after such agreement or within
         ninety (90) days of the effective date of the Co-Development Agreement,
         whichever date is earlier. It is not intended that the sum defined in
         this paragraph shall be the total cost of the research and development
         program for therapeutic indications other than cancer.

3.       TERMINATION OF AGREETMENT

         This extension of the Co-Development Agreement shall be governed by the
         termination provisions of the Co-Development Agreement.

<PAGE>
                                   APPENDIX IV

                   Gross Profit Margin and Net Income Examples

         Joint product costing shall be based on the relative-sales-value method
of joint cost assignment or other joint costing method according to generally
accepted accounting principles and agreed to by Eurobiotech and SRI.

Gross Margin+
-------------

    Gross Sales Revenue
                                                        ------------------------

    Cost of Goods Sold:

        Joint costs (assigned)
                                                        ------------------------
        Separable costs
                                                        ------------------------
             Total Cost of Goods Sold
                                                        ------------------------
        Gross Margin
                                                        ------------------------
        Gross Profit Margin                          %
                                                        ------------------------

+Excludes SRI royalties

Net Income ++
----------

    Gross Sales Revenue
                                                        ------------------------
    Total Cost of Goods Sold
                                                        ------------------------
        Gross Margin
                                                        ------------------------
    *Operating Expenses:

        Joint costs (assigned):

        Selling, G&A
                                                        ------------------------
        R&D, regulatory
                                                        ------------------------
        Depreciation & amortization
                                                        ------------------------
        Financing & interest
                                                        ------------------------
             Total joint costs
                                                        ------------------------

    Separable costs:

        Selling, G&A
                                                        ------------------------
        R&D, regulatory
                                                        ------------------------
        Depreciation & amortization
                                                        ------------------------
        Financing & interest
                                                        ------------------------

             Total separable costs
                                                        ------------------------
        Total Operating Expense
                                                        ------------------------
    Net Income
                                                        ------------------------

++ Excludes SRI royalties, local taxes, corporate income taxes, foreign taxes.

*Assignment of such allowable operating expenses as selling, general and
administrative; research and development, regulatory; depreciation and
amortization; financing and interest shall be according to generally accepted
accounting principles.

<PAGE>

                                  Appendix III

            Sloan-Kettering Institute for Cancer Research Agreement

<PAGE>

Inter Institutional Agreement                                            Page 1
SKI/Southern
--------------------------------------------------------------------------------

                          INTER-INSTITUTIONAL AGREEMENT
                                   (SK#3294)

         Effective on the 31st day of August, 1998 (the "Effective Date"),

         SLOAN-KETTERING INSTITUTE FOR CANCER RESEARCH, a not-for-profit
corporation organized and existing under the laws of the State of New York, and
having a place of business located at 1275 York Avenue, New York, New York 10021
(hereinafter "SKI") and

         SOUTHERN RESEARCH INSTITUTE, a not-for-profit corporation organized
under the laws of the State of Alabama and having a place of business located at
2000 Ninth Avenue South, P.O. Box 55305, Birmingham, Alabama 35205 (hereinafter
"Southern"),

         hereinafter collectively referred to as the "Parties, or individually
as a "Party"

         in consideration of the mutual covenants contained herein, AGREE AS
FOLLOWS:

                                    ARTICLE 1
                            BACKGROUND & DEFINITIONS

s.1.1    The Parties to this agreement each have patents and/or patent
         applications relating to 2'-Fluoro-Arabinofuranosyl Purine Nucleoside
         technology including specific compounds, the synthesis of such
         compounds, and uses of such compounds as therapeutic treatments for
         cancer and other disease conditions, including:

         a.       "SKI Patents" defined as compounds 3,4, 5 & 6 of claim 2 and
                  compound 2 of claim 3 of U.S. Patent No. 4,751,221, issued
                  June 14, 1988 entitled, 2'-Fluoro-Arabinofuranosyl Purine
                  Nucleosides, and claim 1 of U.S. Patent No. 4,918,179 issued
                  April 17, 1990 entitled 2'-Fluoro-Arabinofuranosyl Purine
                  Nucleosides, and any conversions, continuations,
                  continuations-in-part, divisionals, foreign equivalents,
                  reissues, or other derivatives of these patents and patent
                  applications and matters that are the subject of these patents
                  and patent applications, (hereinafter referred to as "SKI
                  Patents"); and

         b.       "Southern Patents" defined as U.S. Patent 5,034,518 issued
                  July 23, 1991 entitled, 2'-Fluoro-9-(2-Deoxy-2-Fluoro-[Beta]
                  -D-Arabinofuranosyl) Adenine Nucleosides, U.S. Patent
                  5,384,310 issued January 24, 1995 entitled 2'-Fluoro-2
                  Haloarabinoadinosines and Their Pharmaceutical Compositions,
                  and U.S. Patent 5,661,136 issued August 26, 1997 entitled
                  2-halo-2'-fluoro ARA adenosines as antinoplastic agents, and
                  any conversions, continuations, continuations-in-part,
                  divisionals, foreign equivalents, reissues, or other
                  derivatives of these patents and patent applications and
                  matters that are the subject of these patents and patent
                  applications (hereinafter referred to as "Southern Patents").

<PAGE>

Inter Institutional Agreement                                            Page 2
SKI/Southern
--------------------------------------------------------------------------------

s.1.2   "Technology" shall include Southern Patents and those SKI Patents
        (listed in Exhibit B of this Agreement) to the extent necessary to
        enable the practice of Southern Patents and SKI Patents issued in
        countries in which Southern Patents are not issued or pending.

s.1.3   Inventions described in SKI Patents were developed at SKI by Drs.
        Kyoichi A. Watanabe, Chung K. Chu, and Jack J. Fox, and inventions
        described in Southern Patents were developed at Southern by Drs. John
        A. Montgomery and John A. Secrist, III (hereinafter collectively
        referred to as "Inventors").

s.1.4   The Parties desire to provide for the development, utilization, and
        commercialization of the Technology through licensing activities or
        codevelopment activites.

s.1.5   "Confidential Information" means (i) any know-how, information or
        material in tangible form that is marked as confidential or proprietary
        by the furnishing party at the time it is delivered to the receiving
        party, and (ii) information that is disclosed orally, provided that
        such information is specifically identified by the disclosing party as
        Confidential Information; and provided further that any information
        that is disclosed orally be confirmed in written summary form by the
        disclosing party within thirty (30) days. The party who receives
        Confidential Information from the other party is referred to in this
        Agreement as the "Recipient", and the disclosing Party is referred to
        as the "Discloser".

                                   ARTICLE 2
                                   OWNERSHIP

s.2.1   The Parties have or shall have separate agreements with their
        respective Inventors, whereby their respective Inventors agree to
        assign all right, title and interest in Inventions to their
        institutions, and whereby the respective Inventors agree to cooperate
        with and assist their institutions in preparing, filing, prosecuting
        and maintaining patent applications and patents relating to Inventions
        throughout the world.

s.2.2   Each Party shall explicitly retain their respective rights and
        ownership it may have in Technology.

                                   ARTICLE 3
                              COMMERCIALIZATION

s.3.1   The Parties shall each cooperate to achieve the commercial utilization
        and exploitation of Technology and shall keep each other informed of
        all requests by third Parties concerning commercial utilization or
        exploitation.

<PAGE>

Inter Institutional Agreement                                            Page 3
SKI/Southern
--------------------------------------------------------------------------------

s.3.2   The Parties warrant and represent that with respect to Technology they
        are under no obligation to anyone other than the inventors,
        contributors, and funding agencies.

s.3.3   Except as otherwise expressly set forth in this Agreement, each Party
        MAKES NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF ANY KIND, EITHER
        EXPRESS OR IMPLIED, INCLUDING BUT NOT LIMITED TO WARRANTIES OF
        MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, VALIDITY OF PATENT
        RIGHTS CLAIMS, ISSUED OR PENDING, AND ABSENSE OF INFRINGEMENT OF OR BY
        RIGHTS OF OTHERS.

s.3.4   Each Party is unaware of any claims asserted against them by any third
        parties with respect to patent infringement or any other type of
        liability relevant to licensing of the Technology, which have not been
        disclosed to the other Party as of the Effective Date of this
        Agreement.

                                   ARTICLE 4
                                    GRANTS

s.4.1   Upon execution of the codevelopment agreement between Southern and
        Eurobiotech Group, Inc. (hereinafter "Eurobiotech") shown in Exhibit A
        (hereinafter "Eurobiotech Agreement") by both Southern and Eurobiotech,
        SKI will have been deemed to have granted to Southern an exclusive,
        worldwide license to SKI's rights in the Technology, with the right to
        sublicense, to the extent necessary for Southern to fulfill its
        obligations under its license of the Technology to Eurobiotech Group,
        Inc.

s.4.2   Both SKI and Southern are free to use the Technology for their internal
        purposes in any way they deem fit, without informing the other party.

                                   ARTICLE 5
                             SHARING OF PROCEEDS

s.5.1   All proceeds received by Southern, including but not limited to cash or
        common stock payments, from the licensing or other commercial
        utilization of any portion of Technology pursuant to Articles 3 and 4,
        excluding fees for research & development, shall be apportioned
        seventy-five percent (75%) to Southern and twenty-five percent (25%) to
        SKI until the termination of Eurobiotech Agreement.

s.5.2   If Southern receives from Eurobiotech anything of value in lieu of cash
        payments, Southern shall share such payment with SKI according to
        Article 5.1, based on the fair market value of such payment on the date
        received by Southern, unless SKI waives in writing such payment
        obligation in part or in full.

<PAGE>

Inter Institutional Agreement                                            Page 4
SKI/Southern
--------------------------------------------------------------------------------

s.5.3   Southern agrees to distribute to SKI it's share of royalty or other
        income in accordance with this Agreement, within thirty (30) days of
        receiving such payments. If distribution requires having shares of
        stock be put into SKI's name, Southern agrees to initiate such
        procedure within fifteen (15) days of of receipt of such stock shares.
        Such payments shall be accompanied by a report from each licensee
        detailing the calculation of royalties or milestone payment being paid.
        Such payments shall show "Payment under Contract SK# 3294" on the check
        stub, and shall be sent to:

              Memorial Sloan-Kettering Cancer Center
              Office of Industrial Affairs
              1275 York Avenue
              New York, New York 10021

        Failure to pay such sums within thirty (30) days of receipt from
        licensee shall be considered a material breach of this Agreement and,
        after due notice according to Article 12, is sufficient grounds for
        termination of this Agreement with the non-paying Party.

s.5.4   Southern shall keep full, true and accurate records containing all
        particulars that may be necessary for the purpose of showing the
        proceeds paid. For the term of this Agreement, upon receipt of thirty
        (30) days prior written notice, Southern shall allow SKI or its agents
        to inspect such records for the purpose of verifying Southern's payment
        statements or compliance in other respects with this Agreement. Should
        such inspection lead to the discovery of a greater than five percent
        (5%) discrepancy in reporting to SKI's detriment, Southern agrees to
        pay the full cost of such inspection.

s.5.5   Southern agrees to copy SKI promptly with all material correspondence
        between Southern and Eurobiotech and to consult with Sloan-Kettering on
        all Southern decisions which may cost an estimated $1000 or more, or
        which may affect the value of the Technology or the income from the
        Technology by an estimated $1000 or more.

                                   ARTICLE 6
                         PATENT MANAGEMENT & EXPENSES

s.6.1   SKI shall be responsible for preparing, filing, prosecuting and
        maintaining SKI Patents. As of the Effective Date of the Eurobiotech
        Agreement, SKI shall maintain SKI Patent Rights until the expiration of
        such rights or the termination of this Agreement, whichever occurs
        first. SKI agrees to copy Southern on patent correspondence relating to
        SKI Patent Rights.

s.6.2   Southern shall be responsible for preparing, filing, prosecuting and
        maintaining Southern Patents. As of the Effective Date of the
        Eurobiotech Agreement, Southern shall maintain Southern Patent Rights
        until the expiration of such rights or the termination of this
        Agreement, whichever occurs first. Southern agrees to copy SKI on
        patent correspondence relating to Southern Patent Rights.

<PAGE>

Inter Institutional Agreement                                            Page 5
SKI/Southern
--------------------------------------------------------------------------------

        all patent applications and patents relating to Technology shall be
        borne by the respective Party until the execution of the Eurobiotech
        Agreement. Upon signing the Eurobiotech Agreement, Southern shall be
        responsible for and pay all future costs and expenses incurred by SKI
        for the preparation, filing, prosecution, issuance, and maintenance of
        the SKI Patents. SKI or its outside patent counsel will submit invoices
        to Southern for such costs and expenses, and Southern shall pay the
        invoiced amount within sixty days (60) of the date of such invoice.

s.6.4   Failure to pay patent expenses shall be considered a material breach of
        contract and, after due notice according to Article 12, is sufficient
        grounds for termination of this Agreement with the non-paying Party.

                                   ARTICLE 7
                                   INTEREST

s.7.1   Southern shall pay to SKI interest on any amounts not paid when due.
        Such interest will accrue from the fifteenth (15th) day after the
        payment was due at a rate two percent (2%) above the daily prime
        interest rate, as determined by The Chase Manhattan Bank (N.A.) or its
        successor entity, on each day the payment is delinquent, and the
        interest payment will be due and payable on the first day of each month
        after interest begins to accrue, until full payment of all amounts due
        Sloan-Kettering is made.

s.7.2   SKI's rights to receive such interest payments shall be in addition to
        any other rights and remedies available to SKI.

s.7.3   If the interest rate required in this subsection exceeds the legal rate
        in a jurisdiction where a claim for such interest is being asserted,
        the required interest rate shall be reduced, for such claim only, to
        the maximum interest rate allowable in the jurisdiction.

                                   ARTICLE 8
                                CONFIDENTIALITY

s.8.1   During the term of this Agreement and for a period of five years
        thereafter, The receiving party (hereinafter "Recipient") shall retain
        in confidence, and shall not disclose to a third party without the
        express written consent of the disclosing party (hereinafter
        "Discloser"), any Confidential Information disclosed under this
        Agreement, except for that Confidential Information which:

        a)       was in the possession or control of the Recipient before it
                 was received, as shown by written records;

        b)       is available, or becomes available, to the public through no
                 fault of Recipient or of any of Recipient agents or
                 employees;

<PAGE>

Inter Institutional Agreement                                            Page 6
SKI/Southern
--------------------------------------------------------------------------------

        c)       is rightfully received from sources not bound by a similar
                 confidentiality agreement with the Discloser, or

        d)       is independently developed by Recipient without knowledge or
                 use of the Confidential Information, as proven by competent
                 evidence.

s.8.2   After receipt of written consent from Discloser to disclose
        Confidential Information to a third party, and prior to such
        disclosure, Recipient hereto shall obtain the written agreement of such
        third party, who is not otherwise bound by fiduciary obligations to
        Recipient, to hold in confidence and not make use of Confidential
        Information for any purpose other than those permitted by this
        Agreement. Recipient shall notify the other promptly upon discovery of
        any unauthorized use or disclosure of the Discloser's Confidential
        Information.

s.8.3   Nothing in this Agreement shall preclude SKI or Southern from making
        reports or disclosures required by the National Institutes of Health or
        any other organization which provided funds used for the research
        relating to Technology, or disclosing Confidential Information to the
        minimum extent required to comply with court orders, regulations or
        statutes.

                                   ARTICLE 9
                              PATENT INFRINGEMENT

s.9.1   If any Party becomes aware of any infringement of a patent covered by
        this Agreement, it shall notify and discuss with the other Party what
        action is required to terminate such infringement. Each Party shall
        have the option of taking action against any third party infringer of
        their respective patent rights. If both Parties agree to act against
        the infringement jointly, they shall share equally in the expenses and
        disbursements in connection with such action and shall also share
        equally all monies received as a result of such action. If one Party
        does not agree to join in the action against infringement, the other
        Party will have the right to prosecute a patent infringement action at
        their sole expense, and shall be entitled to retain all monies
        recovered.

s.9.2   If the Eurobiotech Agreement has been executed at the time the Parties
        become aware of any such infringement, Eurobiotech may join in such
        action against any third party infringer as specified in the
        Eurobiotech Agreement. In that event one or both Parties may elect not
        to join in the action against the third party infringer as specified in
        the Eurobiotech Agreement without being penalized according to Article
        9.1.

                                  ARTICLE 10
                               INVENTORS SHARES

s.10.1  This Agreement does not preclude inventors from receiving from their
        respective institutions their share of royalty income and such other
        benefits, if any, specified under the respective patent policies of
        each of the Parties or under such other

<PAGE>

Inter Institutional Agreement                                            Page 7
SKI/Southern
--------------------------------------------------------------------------------

        agreements that may exist between inventors and their respective
        institutions. No Party shall be responsible for the other Parties'
        obligations to their inventors.

                                  ARTICLE 11
                               NON-USE OF NAMES

s.11.1  Neither Party shall use the names of the other Party, nor any of its
        Affiliates, employees, nor any adaptation thereof, in any advertising,
        promotional or sales literature without prior written consent obtained
        from the other Party in each case.

                                  ARTICLE 12
                             TERM AND TERMINATION

s.12.1  This Agreement shall remain in effect from the Effective Date until the
        last to occur of: (a) the expiration of the last to expire of SKI
        Patents and Southern Patents; (b) the expiration of the Eurobiotech
        Agreement, (c) termination according to s.12.2 of this Agreement; or
        (d) by mutual agreement of the parties expressed in writing.

s.12.2  Failure by any Party to comply with any of the material obligations and
        conditions contained in this Agreement shall entitle the other Party to
        give written notice requiring it to cure such default. If such default
        is not cured within sixty (60) days after receipt of such notice, the
        notifying Party shall be entitled (without prejudice to any of its
        other rights conferred on it by this Agreement) to terminate this
        Agreement with the defaulting Party by giving notice to take effect
        immediately.

s.12.3  Provisions of Article 8, and any other obligation incurred by a Party
        during the term of this Agreement shall survive termination.

                                  ARTICLE 13
                                 SEVERABILITY

s.13.1  If one or more of the provisions of this Agreement shall be held to be
        invalid, illegal, or unenforceable in any respect, the validity,
        legality, and enforceability of the remaining provisions shall not in
        any way be affected or impaired thereby, provided that the intent of
        the Parties in entering into the Agreement is not materially affected
        thereby.

                                  ARTICLE 14
                                    NOTICES

s.14.1  Any communication required or permitted under this Agreement shall be
        made in writing and sent to such Party, postage prepaid, addressed to
        it as set out below, or as it shall subsequently designate by notice
        to the other Party. However, if the

<PAGE>

Inter Institutional Agreement                                            Page 8
SKI/Southern
--------------------------------------------------------------------------------

        Agreement, such communication shall be sent by registered or certified
        mail or other means providing proof of delivery, and also communicated
        by telephone as promptly as possible. Communications or notices shall
        be addressed as follows:

        In the case of SKI, the communication or notice shall be addressed to:

            Sloan-Kettering Institute for Cancer Research
            1275 York Avenue
            New York, New York 10021
            Attention: James S. Quirk
                       Senior Vice President
                       Research Resources Management

        In the case of Southern, the communication or notice shall be addressed
        to:

            Southern Research Institute
            2000 Ninth Avenue South
            P.O. Box 55305
            Birmingham, Alabama 35255-5305
            Attention: President

                                  ARTICLE 15
                                 GOVERNING LAW

s.15.1  This Agreement shall be governed by and construed in accordance with
        the laws of the State of New York.

                                  ARTICLE 16
                               ENTIRE AGREEMENT

s.16.1  This instrument contains the entire Agreement between the Parties
        hereto and supersedes all prior Agreements with respect to Technology.
        Any modifications of this Agreement to be effective must be in writing
        and signed by all Parties.

                                  ARTICLE 17
                                INDEMNIFICATION

s.17.1  Southern, and any sublicensee of rights granted under this Agreement,
        including Eurobiotech, shall at all times during the term of this
        Agreement and thereafter, indemnify, defend and hold SKI, its Board of
        Managers, officers, employees and affiliates, harmless against all
        claims and expenses, including legal expenses and reasonable attorneys'
        fees, arising out of the death of or injury to any person or persons or
        out of any damage to property and against any other claim, proceeding,
        demand, expense and liability of any kind whatsoever resulting from the
        production, manufacture, sale, use, lease, consumption or advertisement
        of the Licensed

<PAGE>

Inter Institutional Agreement                                            Page 9
SKI/Southern
--------------------------------------------------------------------------------

        Product(s) and/or Licensed Process(es) or arising from any obligation
        of LICENSEE hereunder, except for any injuries, losses or damages that
        specifically result from the gross negligence or willful misconduct of
        SKI.

                                  ARTICLE 18
                            MISCELANEOUS PROVISIONS

s.18.1  Each Party hereby acknowledges that the rights and obligations of this
        Agreement are subject to the laws and regulations of the United States
        relating to the export of products and technical information. Without
        limitation, each Party shall comply with all such laws and regulations.

s.18.2  This Agreement shall not be construed to grant any license or other
        rights to either party in any patent rights, know-how, or other
        technology of the other party, except as expressly provided in this
        Agreement.

s.18.3  Neither party shall assign its rights or obligations under this
        Agreement, in whole or in part, by operation of law or otherwise,
        without the prior written consent of the other, except to successor to
        all or substantially all of the party's assets or business operations
        relating to the intellectual property that is the subject of this
        Agreement. Any purported assignment in violation of this article shall
        be null and void.

s.18.4  The waiver by either party hereto of any right hereunder or of the
        failure to perform or of a breach by the other party shall not be
        deemed a waiver of any other right hereunder or of any other breach or
        failure by said other party whether of a similar nature or otherwise.

s.18.5  This Agreement may be executed in two or more counterparts, each of
        which shall be deemed an original, but all of which together shall
        constitute one and the same instrument.

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

Sloan-Kettering Institute for Cancer         Southern Research Institute
Research

By: /s/ G.J. Bernhardt                       By: /s/ G.E. Dwyer
   -----------------------------                --------------------------------

Name: James S. Quirk                         Name: G.E. Dwyer

Title: Senior Vice President                 Title: President and CEO

Date:      9/8/1998                          Date:     9/1/1998

<PAGE>

Inter Institutional Agreement
SKI/Southern
--------------------------------------------------------------------------------

                                    EXHIBIT B

SKI Patents

          United States Patent Number 4,751,221 issued June 14, 1988
          United States Patent Number 4,918,179 issued April 17, 1990
          Canadian Patent Number 1,271,192 issued July 3, 1990
          EPO Patent Number 0219829 issued December 30, 1992 in Germany,
               France, and the United Kingdom
          Japanese Patent Number 1998734 issued December 5, 1995

Southern Patents

          United States Patent Number 5,034,518 issued July 23, 1991
          United States Patent Number 5,384,310 issued January 24, 1995
          United States Patent Number 5,661,136 issued August 26, 1997
          European Patent Number 0473708 issued January 15, 1997 in France,
               Germany, Great Britain, Italy, Netherlands, Spain, Sweden, and
               Switzerland
          European Patent Application Serial Number 92912163.0 filed May 7,
               1992, designating Austria, Belgium, Germany, Greece, France,
               Italy, Luxembourg, Monaco, Netherlands, Spain, Sweden,
               Switzerland, and the United Kingdom.
          Japanese Patent Application Serial Number 2-508789 filed May 23, 1990
          Japanese Patent Application Serial Number500121/1993 filed May 7, 1992
          Canadian Patent Application Serial Number 2,102,782 filed May 7, 1992

<PAGE>

                                 [LOGO OMITTED]

                              Senior Vice President
                          Research Resources Management

                                                    September 3, 1998

TO WHOM IT MAY CONCERN:

           In my absence, Mr. Gustave J. Bernhardt, Director, Research Resources
Management, will sign as an institutional official for the Sloan-Kettering
Institute for Cancer Research.

                                                       /s/ James S. Quirk
                                                       -------------------------
                                                       James S. Quirk
                                                       Senior Vice President

JSQ:meb

                     Memorial Sloan-Kettering Cancer Center

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