Document:

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                                                                  EXHIBIT 10.210

               "CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC."

                         U.S. MARKET RESEARCH AGREEMENT

This U.S. Market Research Agreement is made effective the 22 day of February,
2001 (the "Effective Date"), between Lifescan, Inc., a Delaware corporation,
having its principal place of business at 1000 Gibraltar Drive, Milpitas, CA
95035-6312, and Cygnus, Inc., a Delaware corporation, having its principal place
of business at 400 Penobscot Drive, Redwood City, California 94063.

WITNESSETH

WHEREAS, the parties have been engaged in discussions concerning possible
business relationships relating to Cygnus' products in the field of glucose
monitoring, including but not limited to, the Cygnus GlucoWatch(R) biographer;

WHEREAS, Lifescan desires additional information in order to assess the market
potential of the GlucoWatch(R) biographer platform prior to committing to a
definitive business arrangement;

NOW, THEREFORE, in consideration of the premises and covenants hereinafter
contained and other good and valuable consideration each to the other paid and
received, the receipt and sufficiency of which is hereby acknowledged, the
parties agree as follows.

         DEFINITIONS.

As used herein,

a.       "Collaboration Agreement" is defined as a business relationship for
         purposes set forth in Section 7 in, or including, the United States
         relating to Cygnus' products in the field of glucose monitoring,
         including but not limited to the Cygnus(TM) GlucoWatch(R) biographer,
         and involving any, but not all, of the following functions or
         combinations thereof: licensing, marketing, sales, supply,
         distribution, or customer service support for the purpose of
         commercializing Cygnus' products in the field of glucose monitoring,
         including but not limited to the Cygnus(TM) GlucoWatch(R) biographer.

b.       "Comprehensive Collaboration Agreement" is defined as a business
         relationship in, or including, the United States relating to Cygnus'
         products in the field of glucose monitoring, including but not limited
         to the Cygnus(TM) GlucoWatch(R) biographer and wherein one company
         provides all commercial functions, with the exception of research and
         development, clinical and regulatory support, and manufacturing,
         necessary to market, sell, supply, distribute, and support customers in
         exchange for a risk in return (i.e., a percentage of product sales
         revenues, gross margin, operating profit, etc.).

c.       "U.S. Market Research Agreement" is defined as the present Agreement.

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               "CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC."

d.       "Initial U.S. Test Market Study" is defined as Cygnus' initial market
         research study in the United States pursuant to the study description
         set forth as Exhibit A attached hereto.

e.       "Exclusivity Period" is defined as the time period beginning on the
         Commencement Date and ending sixty (60) calendar days after the
         Commencement Date.

f.       "Commencement Date" is defined as the date upon which Cygnus provides
         Lifescan with the Data from at least 100 individuals who have
         participated in the Initial U.S. Test Market Study for ninety (90)
         calendar days.

g.       "Data" is defined as the information agreed to be provided by Cygnus to
         Lifescan from the Initial U.S. Test Market Study as set forth in the
         description attached as Exhibit D hereto, which will be collected from
         the Patient Intake Survey attached as Exhibit B hereto and the Daily
         Diary attached as Exhibit C hereto.

h.       "Negotiation Period" is defined as the time period beginning at the end
         of the Exclusivity Period and ending sixty (60) calendar days
         thereafter.

i.       "Lifescan Market Research" is defined as market research conducted by
         Lifescan independent of Cygnus' Initial U.S. Test Market Study.

         1. ACCESS TO CYGNUS' INITIAL U.S. TEST MARKET STUDY.

         Cygnus, at its sole discretion, plans to conduct an Initial U.S. Test
Market Study with Cygnus' commercially available GlucoWatch(R) biographer prior
to Cygnus' broad-scale launch of the GlucoWatch(R) biographer in the United
States. Cygnus will consider and, if Cygnus deems appropriate, will incorporate
input from Lifescan regarding the market research direction for the Initial U.S.
Test Market Study. The cost of conducting the Initial U.S. Test Market Study
will be borne by Cygnus, including the supply of Cygnus' GlucoWatch(R)
biographers and AutoSensors. Lifescan will provide, free of charge, Lifescan
glucose monitors and test strips for use in the Initial U.S. Test Market Study,
if so requested by Cygnus. Cygnus will be the owner of and will have all rights
to the data generated by the Initial U.S. Test Market Study. Cygnus will provide
Lifescan with access to the Data generated by the Initial U.S. Test Market Study
on an exclusive basis as set forth in Section 3 below. Notwithstanding Section 3
below, Cygnus may provide third parties who have no commercial interest in the
GlucoWatch(R) biographer with access to the Initial U.S. Test Market Study Data
as may be required in connection with regulatory and/or medical review of the
GlucoWatch(R) biographer. In the event that Cygnus has not initiated (wherein
initiation is defined as the first subject in the Initial U.S. Test Market Study
commencing wearing the GlucoWatch(R) biographer) the Initial U.S. Test Market
Study within twelve (12) months after Cygnus receives approval of its pre-market
approval (PMA) application from the U.S. Food and Drug Administration (FDA),
then this U.S. Market Research Agreement will terminate in its entirety on such
date; provided that Sections 9 and 13 will survive such termination.

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               "CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC."

         2. DUE DILIGENCE ON CYGNUS GLUCOSE MONITORING PRODUCTS.

         During the term of this Agreement, Cygnus will provide Lifescan with
information relating to its GlucoWatch(R) biographer and AutoSensor and its
future generation glucose monitoring products, including but not limited to the
product referred to as "Gemini". This information shall be provided under the
confidentiality provisions of Section 9 below and the scope and substance of
such information will be typical of presentations given by Cygnus to other
prospective commercial partners. In the event that the parties enter into the
Negotiation Period then, during this Period, Cygnus will provide Lifescan such
additional access to technical data, results and analyses as Cygnus, in its sole
discretion, believes is warranted for the purposes of the Negotiation Period.

         3. EXCLUSIVITY PERIOD.

         Cygnus will provide Lifescan with Data from the Initial U.S. Test
Market Study on the Commencement Date of the Exclusivity Period. During the
Exclusivity Period, Cygnus and its affiliates (as used in this Agreement, an
"affiliate" of a party refers to an entity controlled by, or under common
control with, or controlling such party wherein "control" refers to ownership of
greater than fifty percent (50%)), officers, directors, agents or other
representatives, will not, directly or indirectly, disclose or furnish to any
party other than Lifescan , its affiliates, officers, directors, agents or other
representatives, the results of the Initial U.S. Test Market Study or the
Lifescan Market Research, except as provided in Section 1 above. The initiation,
progress, or completion of Lifescan Market Research will not affect the timing
of the Commencement Date, Exclusivity Period, or Negotiation Period in any
manner.

         4. NEGOTIATION PERIOD.

           At the end of the Exclusivity Period, if the parties mutually agree
that they are interested in entering into a Comprehensive Collaboration
Agreement, the parties will by written agreement enter into the Negotiation
Period and negotiate towards the finalization and execution of a definitive
Comprehensive Collaboration Agreement. It is understood that neither party shall
have any affirmative obligation to enter into any Comprehensive Collaboration
Agreement at any time. If at the end of the Exclusivity Period the parties
decide not to enter into the Negotiation Period, then this U.S. Market Research
Agreement shall terminate in its entirety and the parties shall have no further
obligations or rights to each other; provided that Sections 9 and 13 of this
Agreement will survive such termination. Notwithstanding the foregoing, if at
the end of the Exclusivity Period, the parties decide not to enter into the
Negotiation Period, (a) Cygnus will be free to discuss the results of the
Initial U.S. Test Market Study with any party without restriction, (b) Cygnus
will return to Lifescan and/or destroy all written information, in physical or
electronic format, in Cygnus' possession that is in any way related to the
Lifescan Market Research or any other Confidential Information provided to
Cygnus by Lifescan, and (c) Lifescan will return to Cygnus and/or destroy all
written information, in physical or electronic format, in Lifescan's possession
that is in any way related to the Initial U.S. Test Market Study, the Due
Diligence on Cygnus Glucose Monitoring Products under Section 2 above, or any
other Confidential Information provided to Lifescan by Cygnus.

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               "CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC."

         If the parties agree in writing that there shall be a Negotiation
Period, then only during the Negotiation Period Cygnus will not take any of the
following actions with any third party other than Lifescan or its affiliates,
except as may be required by law:

         (a)      (i) solicit, initiate, continue or engage in any negotiations
                  or discussions, or consider or respond positively to any
                  indication of interest, offer or proposal, or enter into any
                  agreement or understanding, to consummate a Comprehensive
                  Collaboration Agreement or (ii) enter into any agreement to
                  consummate a Collaboration Agreement, except those agreements
                  set forth in Section 7 below;

         (b)      disclose or furnish to any party other than Lifescan or its
                  affiliates the results of the Initial U.S. Test Market Study;

         (c)      (i) disclose or furnish to any party other than Lifescan or
                  its affiliates any information concerning Cygnus' assets or
                  business that is in contemplation of a Comprehensive
                  Collaboration Agreement, or (ii) assist or cooperate with any
                  party other than Lifescan or its affiliates to make any offer
                  or proposal to consummate or effect a Comprehensive
                  Collaboration Agreement; or

         (d)      consummate any agreement that would otherwise preclude Cygnus
                  from entering into a Comprehensive Collaboration Agreement
                  with Lifescan, except those actions set forth in Section 7
                  below or activities relating to corporate financial
                  strategies, including but not limited to raising capital,
                  mergers, acquisitions, and restructuring.

         If at the end of the Negotiation Period, the parties have reached
written agreement on material business terms for a Comprehensive Collaboration
Agreement, then the Negotiation Period will be automatically extended for an
additional sixty (60) calendar days so that the parties can finalize and execute
a Comprehensive Collaboration Agreement. If at the end of the Negotiation
Period, the parties have not reached written agreement on material business
terms for a Comprehensive Collaboration Agreement, then this U.S. Market
Research Agreement shall terminate in its entirety and the parties shall have no
further obligations and rights to each other; provided that Sections 9 and 13 of
this Agreement will survive such termination. Notwithstanding the foregoing, if
at the end of the Negotiation Period, the parties have not executed a
Comprehensive Collaboration Agreement, (a)' Cygnus will return to Lifescan
and/or destroy all written information, in physical or electronic format, in
Cygnus' possession that is in any way related to the Lifescan Market Research or
any other Confidential Information provided to Cygnus by Lifescan, and (b)'
Lifescan will return to Cygnus and/or destroy all written information, in
physical or electronic format, in Lifescan's possession that is in any way
related to the Initial U.S. Test Market Study, the Due Diligence on Cygnus
Glucose Monitoring Products under Section 2 above, or any other Confidential
Information provided to Lifescan by Cygnus.

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               "CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC."

         5. LIFESCAN MARKET RESEARCH.

         Lifescan may, in its sole discretion, choose to conduct Lifescan Market
Research. Lifescan will be responsible for the costs of conducting any Lifescan
Market Research and will be the owner of and will have all rights to the data
generated by any Lifescan Market Research. Lifescan will provide Cygnus with
exclusive access to the GlucoWatch(R) biographer-specific data generated by any
Lifescan Market Research. Lifescan will consider and, if Lifescan deems
appropriate, will incorporate input from Cygnus regarding the market research
direction for any Lifescan Market Research, and Cygnus will have a right to
review the description of the GlucoWatch(R) biographer before it is presented to
participants in the Lifescan Market Research. Additionally, Lifescan will
conduct any Lifescan Market Research through a third party so that participants
do not know the identity of Lifescan, and Cygnus will have a right to review any
Lifescan Market Research before it is published or otherwise disclosed to the
public.

         6. RIGHT OF FIRST REFUSAL.

         From the Effective Date of this U.S. Market Research Agreement until
the end of the Exclusivity Period, Cygnus hereby grants to Lifescan a right of
first refusal with respect to a Comprehensive Collaboration Agreement. If at any
time from the Effective Date of this U.S. Market Research Agreement until the
end of the Exclusivity Period, Lifescan decides that it will not pursue a
Comprehensive Collaboration Agreement with Cygnus, then Lifescan shall promptly
give written notice to Cygnus of its decision and this U.S. Market Research
Agreement shall terminate in its entirety and the parties shall have no further
obligations or rights to each other; provided that Sections 9 and 13 of this
Agreement will survive such termination and Subsections (a)' and (b)' of
Section 4 shall apply. If such a Comprehensive Collaboration Agreement is
acceptable to Cygnus, which Cygnus shall decide in its sole discretion, then
Cygnus shall not consummate or agree to consummate such Comprehensive
Collaboration Agreement with any third party without first giving prompt notice
thereof to Lifescan in writing (the "Notice") summarizing the material terms and
conditions of such Comprehensive Collaboration Agreement. In the event that
Lifescan elects to consummate a transaction upon the same material terms and
conditions, Lifescan shall have fifteen (15) calendar days to so notify Cygnus,
and Cygnus shall use all reasonable commercial efforts to facilitate the
consummation of such a Comprehensive Collaboration Agreement with Lifescan
within forty-five (45) calendar days following the receipt of such notification.
If no such consummation of a Comprehensive Collaboration Agreement with Lifescan
is reached within this forty-five (45) day period and the Exclusivity Period has
not expired, then until the expiration of the Exclusivity Period, Cygnus shall
not consummate or agree to consummate such Comprehensive Collaboration Agreement
with any third party on terms materially less favorable to Cygnus than the terms
of the last deal offered to Lifescan by Cygnus without again first giving prompt
Notice to Lifescan summarizing the material terms and conditions of such
Proposal. In such instance, Lifescan shall have forty-five (45) calendar days
thereafter to consummate the Comprehensive Collaboration Agreement on the terms
and conditions set forth in such Notice. Thereafter, the parties shall have no
further obligations to each other. The parties hereby acknowledge and

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               "CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC."

agree that neither party has any obligation to enter into a definitive agreement
concerning the Comprehensive Collaboration Agreement.

         7. PRODUCT LAUNCH.

         Lifescan acknowledges that Cygnus is preparing for, and will execute,
at its sole discretion, a launch of the GlucoWatch(R) biographer in the U.S. as
well as in foreign countries. In connection with such launch, Lifescan
understands that Cygnus will be entering into Collaboration Agreements and other
usual agreements Cygnus believes it needs in order to launch. Cygnus will not be
bound by the terms of Sections 3 and 4 in connection with such arrangements;
PROVIDED that such arrangements do not include a Comprehensive Collaboration
Agreement; and PROVIDED FURTHER that Cygnus uses reasonable commercial efforts
to negotiate a right of Cygnus to terminate such arrangements in the future.

         8. EXECUTION AND PERFORMANCE OF THIS U.S. MARKET RESEARCH AGREEMENT.

         Each party represents and warrants to the other that it has full right,
power and authority to enter into and perform its obligations under this U.S.
Market Research Agreement. Each party further represents and warrants to the
other that the performance of its obligations under this U.S. Market Research
Agreement will not result in a violation or breach of, and will not conflict
with or constitute a default under any agreement, contract, commitment or
obligation to which it or any of its affiliates is a party or by which it is
bound and that it has not granted and will not grant during the term of this
U.S. Market Research Agreement or any renewal thereof, any conflicting rights,
license, consent or privilege with respect to the rights granted herein.

         9. CONFIDENTIALITY; PUBLICITY.

         As used herein, "Confidential Information" shall mean all confidential
or proprietary information that is reduced to writing, in physical or electronic
format, marked as confidential and given to one party by the other party
relating to such other party or any of its affiliates, including data,
information, or analyses resulting from the Initial U.S. Test Market Study and
Lifescan Market Research, information regarding any of the products of such
other party or any of its affiliates, information regarding its advertising,
distribution, marketing or strategic plans or information regarding its costs,
productivity or technological advances. Neither party shall, for five (5) years
after such exchange, use or disclose to third parties any Confidential
Information of the other (except to the extent reasonably necessary to exercise
its rights or comply with its obligations under this U.S. Market Research
Agreement) and each party shall insure that its employees, officers and agents
shall not use or disclose to third parties any Confidential Information of the
other (except to the extent reasonably necessary to exercise its rights or
comply with its obligations under this U.S. Market Research Agreement);
provided, however, that Lifescan and Cygnus may disclose Confidential
Information to each of their affiliates and consultants if such persons are
informed of the confidential nature of such information and are under an
obligation to keep such information confidential. Confidential Information shall
not include information that (i) was already known to the receiving party at the
time of its receipt thereof, as evidenced

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               "CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC."

by its written records, (ii) is disclosed to the receiving party after its
receipt thereof by a third party who has a right to make such disclosure without
violating any obligation of confidentiality, (iii) is or becomes part of the
public domain through no fault of the receiving party, (iv) is independently
developed by the receiving party, as shown by its written records, without using
any Confidential Information, or (v) is required to be disclosed to comply with
applicable laws or regulations or an order of a court or regulatory body having
competent jurisdiction.

         This U.S. Market Research Agreement is confidential in all respects,
and neither Lifescan nor Cygnus nor their respective officers, employees or
agents shall disclose to any third party any of the terms, except as required by
law. . THE PARTIES RECOGNIZE THAT CYGNUS WILL NEED TO IMMEDIATELY MAKE A PUBLIC
DISCLOSURE REGARDING THIS AGREEMENT, ITS TERMS, AND THE PARTIES THERETO, AND
THAT Cygnus shall consult with and incorporate all reasonable and timely
suggestions of Lifescan in connection with such public disclosure and shall
provide Lifescan with a copy of the planned public disclosure prior to its
release. Neither party shall make any further public disclosures of this
Agreement or its terms without the prior consent of the other party, except as
required by law.

         10. DEFINITIVE COMPREHENSIVE COLLABORATION AGREEMENT.

         Consummation of a potential Comprehensive Collaboration Agreement
involving the parties hereto will be subject to the execution of a definitive
agreement containing representations and warranties, indemnities and other terms
and conditions that are customary for a transaction of this kind and the
satisfaction of any and all applicable governmental requirements and receipt of
all required corporate approvals. This U.S. Market Research Agreement in no way
constitutes nor shall it be construed as creating an obligation of either of the
parties to enter into a definitive Comprehensive Collaboration Agreement. In
addition, this letter does not identify all matters upon which agreement must be
reached in order for a definitive Comprehensive Collaboration Agreement to be
consummated. Except with respect to the obligations set forth in Sections 1, 2,
3, 4, 5, 6, 7, 8 and 9 hereof, a binding commitment to enter into a
Comprehensive Collaboration Agreement will result only from execution of a
definitive Comprehensive Collaboration Agreement.

         11. FEES AND EXPENSES.

         Each party will be responsible for its respective fees and expenses
(including fees and expenses of legal counsel, accountants and investment
bankers) incurred in connection with the negotiation and execution of this U.S.
Market Research Agreement, any definitive Comprehensive Collaboration Agreement,
and any other arrangements contemplated hereby and thereby (whether consummated
or not).

         12. COUNTERPARTS.

         This U.S. Market Research Agreement may be executed in counterparts,
all of which together shall constitute one and the same instrument.

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               "CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC."

         13. GOVERNING LAW.

This U.S. Market Research Agreement shall be governed by, and shall be construed
in accordance with, the laws of the State of California. Any controversy or
claim arising out of or related to this letter shall be settled by arbitration
in accordance with the Commercial Arbitration Rules of the American Arbitration
Association.

IN WITNESS WHEREOF, both parties have executed this U.S. Market Research
Agreement to make it effective as of the date first written above.

CYGNUS INC.

By:      /s/ JOHN C HODGMAN                          Date: 03/05/01
         -----------------------------------               --------------------
         Name: John C Hodgman
         Title: President, CEO & Chairman

LIFESCAN, INC.

By:      /s/ ERIC MILLEDGE                           Date: 02/22/01
         -----------------------------------               ---------------------
         Name: Eric Milledge
         Title: Company Group Chairman

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               [CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC.]

                                                                       EXHIBIT A

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               [CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC.]

                                                                       EXHIBIT B

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               [CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC.]

                                                                       EXHIBIT C

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               [CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC.]

                                                                       EXHIBIT D

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                                                                       EXHIBIT E

                                        FOR MORE INFORMATION, CONTACT:
                                        Corporate Communications, Cygnus, Inc.
                                        (650) 369-4300 www.cygn.com

                  CYGNUS SIGNS U.S. MARKET RESEARCH AGREEMENT
                WITH LIFESCAN FOR THE GLUCOWATCH(R) BIOGRAPHER

REDWOOD CITY, CA - FEBRUARY XX, 2001 - Cygnus, Inc (Nasdaq: CYGN) today
announced the signing of a U.S. Market Research Agreement with Lifescan, a
Johnson & Johnson company, for the GlucoWatch(R) Biographer. Under terms of
the agreement, Lifescan will have exclusive access for a limited period of
time to data from a pilot marketing program to be conducted in the U.S. by
Cygnus for the GlucoWatch Biographer, a frequent, automatic and non-invasive
glucose monitoring device. The agreement also calls for Cygnus to have
exclusive access to any market research conducted by Lifescan relating to the
GlucoWatch Biographer. In addition, the agreement provides Lifescan a right
of first refusal with respect to a Comprehensive Collaboration Agreement from
the signing of the agreement to at least 60 days after market research data
has been received by Lifescan. A Comprehensive Collaboration Agreement is
defined in the agreement as one company providing all commercial functions
necessary to market, sell, supply, distribute and support customers in the
U.S. Neither Cygnus nor Lifescan, headquartered in Milpitas, California has
any obligation to enter into a Comprehensive Collaboration Agreement, which
would require the mutual agreement of both parties.

If the U.S. Food and Drug Administration (FDA) approves the pre-market
approval (PMA) application for the GlucoWatch Biographer, Cygnus anticipates
conducting a pilot marketing program in the U.S. The pilot marketing program
is expected to include about 100-150 people using the Biographer and
participating in extensive market research. The objective of the research is
to gather information on attitudes, practices and experiences among subjects
with diabetes using the GlucoWatch Biographer, along with the attitudes and
experiences of health care professionals who manage their care. The research
is expected to run for at least three months once the pilot marketing program
begins.

"We expect the GlucoWatch Biographer to provide new insights into glucose
trends and patterns that would enable people with diabetes and their health
care teams to make more informed choices about controlling blood sugar
levels. We have already begun to see this from our efforts in the United
Kingdom," stated John C. Hodgman, Chairman and Chief

<PAGE>

Executive Officer of Cygnus, Inc. "The pilot marketing program represents the
first time the GlucoWatch Biographer will be used in the U.S. outside of
controlled clinical trials and therefore provides a unique opportunity to
observe the clinical utility of the GlucoWatch Biographer during normal
usage."

It has been a priority for Cygnus to establish alliances to develop,
manufacture, and commercialize the GlucoWatch system. Cygnus is continuing
commercialization discussions with companies ranging from international
companies interested in a world-wide Comprehensive Collaboration to companies
that would focus on specific geographies or would provide some, but not all,
commercialization functions.

The GlucoWatch Biographer has the potential to be a major advance in diabetes
management. In the U.S., the typical practice for millions of Americans with
diabetes is to perform just a few blood-glucose measurements a day, resulting
in only limited information about their glucose fluctuations. This lack of
information can often contribute to inadequate treatment and, ultimately, to
severe health complications. The GlucoWatch Biographer is a non-invasive
system that automatically measures and displays glucose levels up to every 20
minutes for 12 hours, using a device worn like a wristwatch. It provides
heretofore-unavailable information about glucose trends and patterns that may
help people who have diabetes make more informed choices to control glucose
levels and avoid complications. Other features include an alarm that can be
set to detect high, low, and rapidly declining glucose levels, and a memory
that can store the equivalent of three months of glucose measurements. The
GlucoWatch Biographer is intended for detecting trends and tracking patterns
in glucose levels in adults, 18 years and older who have diabetes. The device
is meant to supplement, not replace, information obtained from standard home
blood-glucose monitoring devices.

On December 6, 1999, Cygnus received a unanimous recommendation for approval
of its PMA application for the GlucoWatch Biographer from the FDA's Clinical
Chemistry and Clinical Toxicology Devices Panel of the Medical Devices
Advisory Committee, subject to certain conditions. In May 2000 Cygnus
received an approvable letter from the FDA for its GlucoWatch Biographer. An
approvable letter means that the FDA has reviewed Cygnus' PMA application, as
well as its own Advisory Committee's report and recommendation, and believes
it will approve the application, pending specific final conditions. The FDA's
conditions relate to manufacturing, final printed labeling materials, and
post-market evaluations of aspects of product performance.

Cygnus, Inc., headquartered in Redwood City, California, develops and
manufactures non-invasive diagnostic medical devices, utilizing proprietary
biosensor technologies to satisfy unmet medical needs cost-effectively. The
company's current efforts are focused on a frequent, automatic, and
non-invasive glucose monitoring device (the GlucoWatch Biographer) and
enhancements thereto.

<PAGE>

THIS NEWS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS REGARDING FUTURE EVENTS
AND THE FUTURE PERFORMANCE OF THE COMPANY THAT INVOLVE RISKS AND
UNCERTAINTIES THAT MAY CAUSE THE COMPANY'S ACTUAL RESULTS TO DIFFER
MATERIALLY. SUCH FACTORS INCLUDE GOVERNMENT APPROVALS, COMMERCIAL
INTRODUCTION, AND MARKET ACCEPTANCE OF THE GLUCOWATCH BIOGRAPHER. FURTHER,
THERE CAN BE NO ASSURANCE THAT THE APPROVABLE LETTER FROM THE FDA WILL RESULT
IN APPROVAL FROM THE FDA FOR THE GLUCOWATCH BIOGRAPHER. THERE CAN BE NO
ASSURANCE THAT THE COMPANY WILL BE ABLE TO ENTER INTO A COMMERCIALIZATION
ALLIANCE OR ALLIANCES OR THAT THE COMPANY WILL BE ABLE TO OUTSOURCE CERTAIN
COMMERCIALIZATION CAPABILITIES FOR LAUNCH IF A WORLDWIDE COMMERCIALIZATION
ALLIANCE WAS NOT IN PLACE. THERE ALSO CAN BE NO ASSURANCE THAT, IF THE
COMPANY RECEIVES MARKETING APPROVAL FROM THE FDA AND SIGNS COMMERCIALIZATION
AGREEMENTS, THE PRODUCT CAN BE SUCCESSFULLY MANUFACTURED OR MARKETED EITHER
IN THE U.S. OR IN EUROPE. THE COMPANY REFERS YOU TO THE DOCUMENTS THE COMPANY
FILES FROM TIME TO TIME WITH THE SECURITIES AND EXCHANGE COMMISSION,
INCLUDING THE COMPANY'S ANNUAL REPORT ON FORM 10-K, QUARTERLY REPORTS ON FORM
10-Q, AND CURRENT REPORTS ON FORM 8-K, WHICH CONTAIN DESCRIPTIONS OF CERTAIN
FACTORS THAT COULD CAUSE THE COMPANY'S ACTUAL RESULTS TO DIFFER FROM THE
COMPANY'S CURRENT EXPECTATIONS AND ANY FORWARD-LOOKING STATEMENTS CONTAINED
IN THIS NEWS RELEASE.<PAGE>

                                                                  EXHIBIT 10.211

               "CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC."

                              TERMINATION AGREEMENT

         This Termination Agreement (the "Termination AGREEMENT") is made, and
is effective, as of February 26, 2001 by and between Cygnus, Inc. ("CYGNUS"), a
Delaware corporation, with its principal place of business at 400 Penobscot
Drive, Redwood City, California U.S.A., 94063 and Yamanouchi Pharmaceutical Co.,
Ltd. ("YAMANOUCHI" and together with Cygnus, the "PARTIES"), a Japanese
corporation, with its principal place of business at 3-11, Nihonbashi-honcho
2-chome, Chuo-ku, Tokyo 103, Japan.

         WHEREAS, the Parties entered into that certain Product Supply and
Distribution Agreement dated as of July 14, 1996 (the "PRODUCT AGREEMENT");

         WHEREAS, the Product Agreement contemplated the development and
production by Cygnus of various products, including without limitation the
GlucoWatch(R) biographer system, a non-invasive glucose monitoring device; and

         WHEREAS, the Parties now wish to terminate the Product Agreement.

         NOW, THEREFORE, in consideration of the mutual promises, undertakings
and covenants herein expressed, the parties agree as follow:

         1. TERMINATION. (a) The parties hereby terminate the Product Agreement
for strategic reasons, by mutual agreement, effective as of the date hereof;
PROVIDED, that this Paragraph shall not relieve Yamanouchi of its obligation
pursuant to Section 6.1 and Schedule A of the Product Agreement to make the last
milestone payment set forth in Schedule A to the Product Agreement in the event
that Cygnus receives its first regulatory registration for the GlucoWatch(R)
biographer system from either the U.S. Food and Drug Administration (FDA) or the
Japanese Ministry of Health and Welfare, whichever event occurs first, on or
before July 11, 2001. The parties agree that this milestone of [CONFIDENTIAL
TREATMENT REQUESTED BY CYGNUS, INC.] will be due and payable if Cygnus, on or
before July 11, 2001, receives FDA approval on its pending pre-market approval
(PMA) application currently before the FDA (PMA #P990026, dated May 26, 1999).
Although the Parties are not terminating the Product Agreement for the reasons
specified in Section 11.3 of the Product Agreement, the Parties hereby agree
that the termination procedures and consequences set forth in Section 11.3 shall
be applicable to the termination of the Product Agreement as if such termination
were being effected pursuant to Section 11.3, except to the extent that such
procedures and consequences are amended by this Termination Agreement. For the
purpose of complying with the notice provisions of Section 11.3 of the Product
Agreement, the Parties agree that Yamanouchi gave Cygnus notice of its intent to
terminate the Product Agreement effective as of October 11, 2000, and that such
notice satisfied all requirements of Section 11.3 of the Product Agreement.

         (b) Yamanouchi hereby relinquishes, effective as of the date hereof,
any non-exclusive rights to, or 18-month right of first offer for, distribution
of Products in the Territory, as described in, and notwithstanding language to
the contrary in, the "PROVIDED, HOWEVER" sentence of Section 11.3 of the Product
Agreement and the sentence immediately following thereafter. Effective as of the
date hereof, Yamanouchi is prohibited from selling any Non-Invasive Products in
Japan until the first anniversary of the date hereof.

<PAGE>
                "CONFIDENTIAL TREATMENT REQUEST BY CYGNUS, INC."

         2. RETURN OF DATA. (a) Within thirty (30) days of the date hereof, each
Party shall return all proprietary information of the other Party disclosed to
it pursuant to Section 15 of the Product Agreement. Pursuant to Section 11.4 of
the Product Agreement, Yamanouchi shall transmit all Japanese regulatory
submissions, regulatory approvals and clinical data regarding the GlucoWatch(R)
biographer system to Cygnus, as specified on Schedule A hereto.

         (b) In the event that either Party shall determine at any time that it
shall not have returned any such information, submissions, approvals or data, it
shall promptly transmit such information to the other Party. In the event that
either Party believes that the other Party has not returned any such data, such
Party shall provide written notification thereof to the other Party, along with
a reasonably detailed description of the data or information that it believes to
be lacking, within nine (9) months after such 30-day period. In the event that
no such notification is made within such nine (9) month period, each Party
waives any claim that it may have against the other Party in respect of such
alleged failure to return such data or information; PROVIDED, that this sentence
shall not relieve either Party of its obligation, as described in Paragraph 2(a)
above, to promptly send or return to the other Party any data, submission,
approval or information which it determines that it has not sent or returned to
such other Party.

         3. CONFIDENTIALITY. The Parties agree that Section 15 of the Product
Agreement shall survive the termination of the Product Agreement in accordance
with the terms of the Product Agreement for the period specified therein.
[CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC.]

         4. SURVIVING PROVISIONS. Nothing in this Termination Agreement shall in
any way affect Section 11.4 of the Product Agreement or the sections specified
therein as surviving the termination of the Product Agreement (I.E., (a) the
last sentence of Section 3.4, (b) Sections 5.6(iv) and (vii), (c) payment
obligations accrued or earned under Section 6 as well as the obligation of
Yamanouchi to make the last milestone payment pursuant to Section 6.1 and
Schedule A if the events specified in Paragraph 1 above are met, (d) Section
12.1, (e) Section 14.1, (f) Section 15, (g) Sections 16.2 and 16.3, (h) Section
17 and (i) Section 18, in each case of the Product Agreement), each of which
shall continue in full force and effect in accordance with their respective
terms. In addition, Section 21.11 of the Product Agreement shall survive the
termination of the Product Agreement and apply to both the Product Agreement and
this Termination Agreement until nine (9) months from the date hereof.

         5. MUTUAL RELEASE. Effective as of the date hereof, and other than with
respect to the obligations referred to in this Termination Agreement, each
Party, on behalf of itself and any individual, corporation, partnership,
association, trust or other natural or legal entity claiming by, through, or
under such Party hereby releases, waives and forever discharges the other Party
and any affiliate, employee, agent, officer, director, attorney, shareholder or
successor or assign thereof (each, a "RELATED PERSON"), from, and with respect
to any and all manner of action and actions, cause and causes of action, suits,
disputes, claims, counterclaims and/or liabilities, cross claims, defenses,
whether now known or unknown, suspected or unsuspected, past or present,
asserted or unasserted, contingent or liquidated, whether or not well-founded in
fact or law, whether in contract, in tort or otherwise, at law or in equity,
which such Party had or now has, claims to have had, now

                                       2
<PAGE>

claims to have or hereafter can, shall or may claim to have against the other
Party or any Related Person thereof, for or by reason of any cause, matter, or
thing whatsoever arising at any time prior hereto through the date hereof,
including any claims based upon, relating to or arising out of any and all
transactions, relationships or dealings with the other Party or any Related
Person prior to the date hereof.

         In connection with this Article, each Party acknowledges and agrees
that it understands the meaning and effect of Section 1542 of the California
Civil Code, which provides:

         Section 1542. General release; extent. A general release does not
         extend to claims which the creditor does not know or suspect to exist
         in his favor at the time of executing the release, which if known by
         him must have materially affected his settlement with the debtor.

EACH PARTY AGREES TO ASSUME THE RISK OF ANY AND ALL UNKNOWN, UNANTICIPATED OR
MISUNDERSTOOD DEFENSES, CLAIMS, CAUSES OF ACTION, CONTRACTS, LIABILITIES,
INDEBTEDNESS AND OBLIGATIONS WHICH ARE RELEASED BY THIS TERMINATION AGREEMENT IN
FAVOR OF THE OTHER PARTY AND EACH RELATED PERSON THEREOF, AND SUCH PARTY HEREBY
WAIVES AND RELEASES ALL RIGHTS AND BENEFITS WHICH IT MIGHT OTHERWISE HAVE UNDER
SECTION 1542 OF THE CALIFORNIA CIVIL CODE WITH REGARD TO THE RELEASE OF SUCH
UNKNOWN, UNANTICIPATED OR MISUNDERSTOOD DEFENSES, CLAIMS, CAUSES OF ACTION,
CONTRACTS, LIABILITIES, INDEBTEDNESS AND OBLIGATIONS. TO THE EXTENT (IF ANY)
WHICH ANY SUCH LAWS MAY BE APPLICABLE, EACH PARTY WAIVES AND RELEASES (TO THE
MAXIMUM EXTENT PERMITTED BY LAW) ANY RIGHT OR DEFENSE WHICH IT MIGHT OTHERWISE
HAVE UNDER ANY OTHER LAW OF ANY APPLICABLE JURISDICTION WHICH MIGHT LIMIT OR
RESTRICT THE EFFECTIVENESS OR SCOPE OF ANY OF ITS WAIVERS OR RELEASES UNDER THIS
TERMINATION AGREEMENT.

         6. AMENDMENT AND WAIVER. This Termination Agreement may be amended, and
any provision of this Termination Agreement waived, only in a separate written
instrument signed by the Parties.

         7. GOVERNING LAW. (a) The provisions in Sections 21.2 and 21.3 of the
Product Agreement shall apply to this Termination Agreement as if they were
incorporated herein in their entirety, except the words "Sections 2, 3, 5, 6 or
11 of" in Section 21.3 shall be deleted and the references to "this Agreement"
in each Section shall refer to this Termination Agreement. (b) Each Party
acknowledges and agrees that a breach of the provisions of Paragraphs 1(b), 2
and 3 would cause the other Party to suffer irreparable damage that could not be
adequately remedied by an action at law. Accordingly, each Party agrees that
each Party shall have the right to seek specific performance of the provisions
of Paragraphs 1(b), 2 and 3 to enjoin a breach or attempted breach thereof, such
right being in addition to all other rights and remedies available to such Party
at law, in equity or otherwise.

         8. ENTIRE AGREEMENT. This Termination Agreement supersedes all
proposals, oral or written, all negotiations, conversations or discussions
between the Parties

                                       3
<PAGE>

and their representatives with respect to the subject matter hereof, including
without limitation that certain powerpoint presentation signed by the Parties
and dated October 11, 2000.

         9. REMEDIES. Except as otherwise expressly stated herein, the rights
and remedies of a Party set forth herein with respect to failure of the other to
comply with the terms of this Termination Agreement are not exclusive, the
exercise thereof shall not constitute an election of remedies and the aggrieved
Party shall in all events be entitled to seek whatever additional remedies may
be available in law or in equity.

         IN WITNESS WHEREOF, the undersigned have affixed their names below as
of the date first written above.

                                            CYGNUS, INC.

                            By:    /s/ JOHN C HODGMAN
                                   ---------------------------------------------
                            Name:  JOHN C HODGMAN
                                   ---------------------------------------------
                            Title: CHAIRMAN, CHIEF EXECUTIVE OFFICER & PRESIDENT
                                   ---------------------------------------------

                            YAMANOUCHI PHARMACEUTICAL CO., LTD

                            By:    /s/ TOICHI TAKENAKA
                                   ---------------------------------------------
                            Name:  TOICHI TAKENAKA
                                   ---------------------------------------------
                            Title: PRESIDENT AND CHIEF EXECUTIVE OFFICER
                                   ---------------------------------------------

                                       4
<PAGE>

               "CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC."

                                                                      SCHEDULE A
                                                     LIST OF DATA TO BE RETURNED

      [CONFIDENTIAL TREATMENT REQUESTED BY CYGNUS, INC.]

                                       5
<PAGE>

EXHIBIT A
                                                                   PRESS RELEASE

       CYGNUS DISCUSSES GLUCOWATCH(R) BIOGRAPHER INTERNATIONAL EVENTS

REDWOOD CITY, CA - OCTOBER 16, 2000 _ Cygnus, Inc. (Nasdaq: CYGN) announced
today that the first commercial GlucoWatch(R) systems have been shipped to the
United Kingdom. As part of the introduction of the GlucoWatch Biographer in the
UK, Cygnus has established a UK Medical Advisory Board. The members of this
esteemed group of physicians will provide the GlucoWatch Biographer to select
adults with diabetes in order to understand patient and health care provider
experiences with this first-of-its-kind frequent, automatic, and non-invasive
glucose monitor. Cygnus plans to launch the GlucoWatch Biographer in the UK
prior to the end of the year.

The introduction of the GlucoWatch Biographer in the UK will be managed as a
controlled launch. The purpose of the controlled launch is to work closely with
Cygnus f UK Medical Advisory Board members to assess patient usage
experiences, to evaluate training and education programs, and to fine-tune
logistics and technical services functions prior to a broader launch in the UK.
Cygnus established its UK subsidiary in July 2000 and has hired initial
management, training, and sales personnel to manage the launch. In addition,
Cygnus is finalizing an agreement with one company to provide direct-to-consumer
distribution/logistics functions and a second agreement with another company to
provide call center technical services for the UK. Cygnus received CE
certification in December 1999, permitting the GlucoWatch Biographer to be sold
in the European Union.

"Shipping the first commercial GlucoWatch systems is a momentous accomplishment
for Cygnus. But more importantly, we are anxious to provide this revolutionary
new technology to people with diabetes in the UK who may benefit from making
more informed choices about controlling their glucose fluctuations. It will be
exciting to see how patients and health care providers can best use the
additional information provided by the GlucoWatch Biographer as part of a
diabetes management program, h stated John C Hodgman, Chairman, Chief
Executive Officer, and President of Cygnus, Inc.

In separate news, Cygnus announced that it has regained the marketing and
distribution rights for the GlucoWatch Biographer in Japan. Yamanouchi
Pharmaceutical Co., Ltd. informed Cygnus that, due to strategic reasons, the
collaboration between Cygnus and Yamanouchi for the marketing and distribution
of the GlucoWatch Biographer in Japan needed to be terminated. Under terms of
the agreement, Yamanouchi will continue to be responsible for a potential
milestone payment over the next nine months and Cygnus assumes ownership of all
the Japanese clinical trial data and regulatory submissions.

We believe that the GlucoWatch non-invasive glucose monitoring system will
have considerable appeal to physicians and patients in Japan. Unfortunately,
for strategic reasons, our continued collaboration with Cygnus is not
possible, h stated Mr. Takeshita, Director of Diagnostic Division, Yamanouchi
Pharmaceutical Co., Ltd.

"Regaining our rights in Japan is consistent with our overall objective to
maintain strategic flexibility as we begin to commercialize the GlucoWatch
Biographer in Europe. The Japanese clinical trials achieved excellent results,
though we do not anticipate product sales in Japan for a number of years, due to
the nature of the Japanese regulatory process. We understand that
Yamanouchi fs strategic considerations require ending our collaboration and
we wish them well, h concluded Mr. Hodgman.

                                   -- MORE --

Cygnus plans to establish one or more alliances to provide commercialization
functions for the GlucoWatch system in North America, Europe, Japan, and
elsewhere in the world. Cygnus is continuing discussions for alliances with
companies ranging from international companies that would

                                       6
<PAGE>

provide a broad range of commercialization functions worldwide, to companies
that would provide specific commercialization functions, such as distribution,
sales, and customer service. Cygnus recently entered into an agreement with
Livingston Healthcare Services, Inc. to provide outsourced logistics services in
the US for the GlucoWatch system. The agreement covers receiving, storage,
customer service, technical support, and shipment. Livingston Healthcare
Services, Inc., a leading health care and logistics supply chain management
provider, develops logistics solutions and provides essential logistics-related
services to companies in the pharmaceutical and health care industries. Cygnus
is still solely responsible for the production, marketing, and sales of the
GlucoWatch system.

In the US, Cygnus is currently focusing on key activities in preparation for
commercializing the GlucoWatch Biographer. Assuming FDA approval of its
pre-market approval (PMA) application, Cygnus will conduct a marketing pilot
program, and plans to introduce the GlucoWatch Biographer initially on a limited
basis to a small number of patients selected by designated physicians, to learn
more about patients' and caregivers' firsthand experiences with the product. To
support that effort, comprehensive training materials have been completed and
will be introduced to physicians and health care professionals. In addition, new
clinical research trials will be started to potentially expand the indications
for the product, focusing on various patient groups, including adolescents and
gestational diabetes. The company will also conduct outcome studies designed to
demonstrate the clinical benefits of the GlucoWatch Biographer, collecting
information that can become part of efforts to secure reimbursement from managed
care organizations. Assuming FDA approval of the PMA application and before the
GlucoWatch Biographer can be made broadly available in the US, Cygnus must
qualify and validate, then submit a PMA Supplement to the FDA for approval of,
its large-scale AutoSensor production equipment and facility.

On December 6, 1999, Cygnus received a unanimous recommendation for approval of
its PMA application for the GlucoWatch system from the FDA's Clinical Chemistry
and Clinical Toxicology Devises Panel of the Medical Devices Advisory Committee,
subject to certain conditions. In May 2000 Cygnus received an approvable letter
from the FDA for its GlucoWatch Biographer. An approvable letter means that the
FDA has reviewed Cygnus' PMA application, as well as its own Advisory
Committee's report and recommendation, and believes it will approve the
application, pending specific final conditions. The FDA fs conditions relate
to manufacturing, final printed labeling materials, and post-market evaluations
of aspects of product performance.

The GlucoWatch Biographer is a frequent, automatic, and non-invasive glucose
monitoring device intended for detecting trends and tracking patterns of glucose
levels in adults, 18 years and older, who have diabetes. Cygnus' GlucoWatch
system, with its durable Biographer and consumable AutoSensor, represents a
potential advance in glucose monitoring technology, as compared to the currently
prevailing "finger stick" blood monitoring methods. The GlucoWatch system is
designed to automatically measure glucose through the wearer's skin as
frequently as every 20 minutes, for up to 12 hours, through the ease and
convenience of a device worn like a wristwatch. Every reading is displayed to
the wearer and stored in memory. Stored readings can be reviewed at the touch of
a button. The device is intended for use at home and in health care facilities
to supplement, not replace, information obtained from standard blood glucose
monitoring devices. The frequency of the automatic and non-invasive readings
gives patients and their caregivers more complete information about glucose
levels, potentially allowing them to make better-informed decisions regarding
diet, medication, and physical activities. Diabetes is a chronic disease
characterized by the body fs inability to produce or properly use insulin, a
hormone that is needed to convert sugar, starches, and other food into the
energy needed for daily life. People with diabetes can take measurements to
reduce the likelihood of serious complications and premature death associated
with diabetes.

Cygnus, Inc., headquartered in Redwood City, California, develops and
manufactures non-invasive diagnostic medical devices, utilizing proprietary
biosensor technologies to satisfy unmet medical needs cost-effectively. The
company fs current efforts are focused on a frequent, automatic, and
non-invasive glucose monitoring device (the GlucoWatch Biographer) and
enhancements thereto.

                                       7
<PAGE>

                                   -- MORE --

THIS NEWS RELEASE CONTAINS FORWARD-LOOKING STATEMENTS REGARDING FUTURE EVENTS
AND THE FUTURE PERFORMANCE OF THE COMPANY THAT INVOLVE RISKS AND UNCERTAINTIES
THAT MAY CAUSE THE COMPANY FS ACTUAL RESULTS TO DIFFER MATERIALLY. SUCH
FACTORS INCLUDE GOVERNMENT APPROVALS, COMMERCIAL INTRODUCTION, AND MARKET
ACCEPTANCE OF THE GLUCOWATCH BIOGRAPHER. FURTHER, THERE CAN BE NO ASSURANCE THAT
THE APPROVABLE LETTER FROM THE FDA WILL RESULT IN APPROVAL FROM THE FDA FOR THE
GLUCOWATCH BIOGRAPHER. THERE CAN BE NO ASSURANCE THAT THE COMPANY WILL BE ABLE
TO ENTER INTO A COMMERCIALIZATION ALLIANCE OR ALLIANCES OR THAT THE COMPANY WILL
BE ABLE TO OUTSOURCE CERTAIN COMMERCIALIZATION CAPABILITIES FOR LAUNCH WITHOUT A
WORLDWIDE COMMERCIALIZATION ALLIANCE IN PLACE. THERE ALSO CAN BE NO ASSURANCE
THAT, IF THE COMPANY RECEIVES MARKETING APPROVAL FROM THE FDA AND SIGNS
COMMERCIALIZATION AGREEMENTS, THE PRODUCT CAN BE SUCCESSFULLY MANUFACTURED OR
MARKETED EITHER IN THE US OR IN EUROPE. THE COMPANY REFERS YOU TO THE DOCUMENTS
THE COMPANY FILES FROM TIME TO TIME WITH THE SECURITIES AND EXCHANGE COMMISSION,
INCLUDING THE COMPANY FS ANNUAL REPORT ON FORM 10-K, QUARTERLY REPORTS ON
FORM 10-Q, AND CURRENT REPORTS ON FORM 8-K, WHICH CONTAIN DESCRIPTIONS OF
CERTAIN FACTORS THAT COULD CAUSE THE COMPANY FS ACTUAL RESULTS TO DIFFER
FROM THE COMPANY FS CURRENT EXPECTATIONS AND ANY FORWARD-LOOKING STATEMENTS
CONTAINED IN THIS NEWS RELEASE.

                                       END

                                       8

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