Document:

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                                                                    EXHIBIT 10.4

                    AMERICAN PHARMACEUTICAL PARTNERS, INC.

                       2001 EMPLOYEE STOCK PURCHASE PLAN
                       ---------------------------------

          The following constitute the provisions of the 2001 Employee Stock
Purchase Plan of American Pharmaceutical Partners, Inc.

          1.   Purpose.  The purpose of the Plan is to provide employees of the
               -------
Company and its Designated Parents or Subsidiaries with an opportunity to
purchase Common Stock of the Company through accumulated payroll deductions.  It
is the intention of the Company to have the Plan qualify as an "Employee Stock
Purchase Plan" under Section 423 of the Code.  The provisions of the Plan,
accordingly, shall be construed so as to extend and limit participation in a
manner consistent with the requirements of that section of the Code.

          2.   Definitions.  As used herein, the following definitions shall
               -----------
apply:

          (a)  "Administrator" means either the Board or a committee of the
                -------------
Board that is responsible for the administration of the Plan as is designated
from time to time by resolution of the Board.

          (b)  "Applicable Laws" means the legal requirements relating to the
                ---------------
administration of employee stock purchase plans, if any, under applicable
provisions of federal securities laws, state corporate and securities laws, the
Code, the rules of any applicable stock exchange or national market system, and
the rules of any foreign jurisdiction applicable to participation in the Plan by
residents therein.

          (c)  "Board" means the Board of Directors of the Company.
                -----

          (d)  "Change in Control" means a change in ownership or control of the
                -----------------
Company effected through the direct or indirect acquisition by any person or
related group of persons (other than an acquisition from or by the Company or by
a Company-sponsored employee benefit plan or by a person that directly or
indirectly controls, is controlled by, or is under common control with, the
Company) of beneficial ownership (within the meaning of Rule 13d-3 of the
Exchange Act) of securities possessing more than fifty percent (50%) of the
total combined voting power of the Company's outstanding securities.

          (e)  "Code" means the Internal Revenue Code of 1986, as amended.
                ----

          (f)  "Common Stock" means the common stock of the Company.
                ------------

          (g)  "Company" means American Pharmaceutical Partners, Inc., a
                -------
Delaware corporation.

          (h)  "Compensation" means an Employee's base salary from the Company
                ------------
or one or more Designated Parents or Subsidiaries, including such amounts of
base salary as are deferred by the Employee (i) under a qualified cash or
deferred arrangement described in Section

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401(k) of the Code, or (ii) to a plan qualified under Section 125 of the Code.
Compensation does not include overtime, bonuses, annual awards, other incentive
payments, reimbursements or other expense allowances, fringe benefits (cash or
noncash), moving expenses, deferred compensation, contributions (other than
contributions described in the first sentence) made on the Employee's behalf by
the Company or one or more Designated Parents or Subsidiaries under any employee
benefit or welfare plan now or hereafter established, and any other payments not
specifically referenced in the first sentence.

          (i)  "Corporate Transaction" means any of the following transactions:
                ---------------------

               (1) a merger or consolidation in which the Company is not the
          surviving entity, except for a transaction the principal purpose of
          which is to change the state in which the Company is incorporated;

               (2) the sale, transfer or other disposition of all or
          substantially all of the assets of the Company (including the capital
          stock of the Company's subsidiary corporations);

               (3) the complete liquidation or dissolution of the Company;

               (4) any reverse merger in which the Company is the surviving
          entity but in which securities possessing more than fifty percent
          (50%) of the total combined voting power of the Company's outstanding
          securities are transferred to a person or persons different from those
          who held such securities immediately prior to such merger; or

               (5) acquisition in a single or series of related transactions by
          any person or related group of persons (other than the Company or by a
          Company-sponsored employee benefit plan) of beneficial ownership
          (within the meaning of Rule 13d-3 of the Exchange Act) of securities
          possessing more than fifty percent (50%) of the total combined voting
          power of the Company's outstanding securities but excluding any such
          transaction or series of related transactions that the Administrator
          determines shall not be a Corporate Transaction.

          (j)  "Designated Parents or Subsidiaries" means the Parents or
                ----------------------------------
Subsidiaries which have been designated by the Administrator from time to time
as eligible to participate in the Plan.

          (k)  "Effective Date" means the effective date of the Registration
                --------------
Statement relating to the Company's initial public offering of its Common Stock.
However, should any Designated Parent or Subsidiary become a participating
company in the Plan after such date, then such entity shall designate a separate
Effective Date with respect to its employee-participants.

          (l)  "Employee" means any individual, including an officer or
                --------
director, who is an employee of the Company or a Designated Parent or Subsidiary
for purposes of Section 423 of the Code. For purposes of the Plan, the
employment relationship shall be treated as continuing intact while the
individual is on sick leave or other leave of absence approved by the
individual's

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employer. Where the period of leave exceeds ninety (90) days and the
individual's right to reemployment is not guaranteed either by statute or by
contract, the employment relationship will be deemed to have terminated on the
ninety-first (91st) day of such leave, for purposes of determining eligibility
to participate in the Plan.

          (m)  "Enrollment Date" means the first day of each Offer Period.
                ---------------

          (n)  "Exchange Act" means the Securities Exchange Act of 1934, as
                ------------
amended.

          (o)  "Exercise Date" means the last day of each Purchase Period.
                -------------

          (p)  "Fair Market Value" means, as of any date, the value of Common
                -----------------
Stock determined as follows:

               (1) If the Common Stock is listed on any established stock
          exchange or a national market system, including without limitation The
          Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq
          Stock Market, its Fair Market Value shall be the closing sales price
          for such stock (or the closing bid, if no sales were reported) as
          quoted on such exchange or system on the date of determination (or, if
          no closing sales price or closing bid was reported on that date, as
          applicable, on the last trading date such closing sales price or
          closing bid was reported), as reported in The Wall Street Journal or
          such other source as the Administrator deems reliable;

               (2) If the Common Stock is regularly quoted on an automated
          quotation system (including the OTC Bulletin Board) or by a recognized
          securities dealer, but selling prices are not reported, the Fair
          Market Value of a Share of Common Stock shall be the mean between the
          high bid and low asked prices for the Common Stock on date of
          determination (or, if no such prices were reported on that date, on
          the last date such prices were reported), as reported in The Wall
          Street Journal or such other source as the Administrator deems
          reliable;

               (3) In the absence of an established market for the Common Stock
          of the type described in (1) and (2), above, the Fair Market Value
          thereof shall be determined by the Administrator in good faith and in
          a manner consistent with Section 260.140.50 of Title 10 of the
          California Code of Regulations which requires that consideration be
          given to (A) the price at which securities of reasonably comparable
          corporations (if any) in the same industry are being traded, or (B) if
          there are no securities of reasonably comparable corporations in the
          same industry being traded, the earnings history, book value and
          prospects of the issuer in light of market conditions generally; or

               (4) On the initial Effective Date of the Plan, the Fair Market
          Value shall be the price at which the Board, or if applicable, the
          Pricing Committee of the Board, and the underwriters agree to offer
          the Common Stock to the public in the initial public offering of the
          Common Stock.

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          (q)  "Offer Period" means an Offer Period established pursuant to
                ------------
Section 4 hereof.

          (r)  "Parent" means a "parent corporation," whether now or hereafter
                ------
existing, as defined in Section 424(e) of the Code.

          (s)  "Participant" means an Employee of the Company or Designated
                -----------
Parent or Subsidiary who is actively participating in the Plan.

          (t)  "Plan" means this Employee Stock Purchase Plan.
                ----

          (u)  "Purchase Period" means a period of approximately six months,
                ---------------
commencing on February 1 and August 1 of each year and terminating on the next
following July 31 or January 31, respectively; provided, however, that the first
Purchase Period shall commence on the Effective Date and shall end on July 31,
2002.

          (v)  "Purchase Price" shall  mean an amount equal to 85% of the Fair
                --------------
Market Value of a share of Common Stock on the Enrollment Date or on the
Exercise Date, whichever is lower.

          (w)  "Reserves" means the sum of the number of shares of Common Stock
                --------
covered by each option under the Plan which have not yet been exercised and the
number of shares of Common Stock which have been authorized for issuance under
the Plan but not yet placed under option.

          (x)  "Subsidiary" means a "subsidiary corporation," whether now or
                ----------
hereafter existing, as defined in Section 424(f) of the Code.

          3.   Eligibility.
               -----------

          (a)  General.  Any individual who is an Employee on a given Enrollment
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Date shall be eligible to participate in the Plan for the Offer Period
commencing with such Enrollment Date.

          (b)  Limitations on Grant and Accrual.  Any provisions of the Plan to
               --------------------------------
the contrary notwithstanding, no Employee shall be granted an option under the
Plan (i) if, immediately after the grant, such Employee (taking into account
stock owned by any other person whose stock would be attributed to such Employee
pursuant to Section 424(d) of the Code) would own stock and/or hold outstanding
options to purchase stock possessing five percent (5%) or more of the total
combined voting power or value of all classes of stock of the Company or of any
Parent or Subsidiary, or (ii) which permits the Employee's rights to purchase
stock under all employee stock purchase plans of the Company and its Parents or
Subsidiaries to accrue at a rate which exceeds Twenty-Five Thousand Dollars
($25,000) worth of stock (determined at the Fair Market Value of the shares at
the time such option is granted) for each calendar year in which such option is
outstanding at any time.  The determination of the accrual of the right to
purchase stock shall be made in accordance with Section 423(b)(8) of the Code
and the regulations thereunder.

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          (c)  Other Limits on Eligibility.  Notwithstanding Subsection (a),
               ---------------------------
above, the following Employees shall not be eligible to participate in the Plan
for any relevant Offer Period: (i) Employees whose customary employment is 20
hours or less per week; (ii) Employees whose customary employment is for not
more than 5 months in any calendar year; (iii) Employees who have been employed
for fewer than three business days; and (iv) Employees who are subject to rules
or laws of a foreign jurisdiction that prohibit or make impractical the
participation of such Employees in the Plan.

          4.   Offer Periods.
               -------------

          (a)  The Plan shall be implemented through overlapping or consecutive
Offer Periods until such time as (i) the maximum number of shares of Common
Stock available for issuance under the Plan shall have been purchased or (ii)
the Plan shall have been sooner terminated in accordance with Section 19 hereof.
The maximum duration of an Offer Period shall be twenty-seven (27) months.
Initially, the Plan shall be implemented through overlapping Offer Periods of
twenty-four (24) months' duration commencing each February 1 and August 1
following the Effective Date (except that the initial Offer Period shall
commence on the Effective Date and shall end on January 31, 2004).

          (b)  A Participant shall be granted a separate option for each Offer
Period in which he or she participates.  The option shall be granted on the
Enrollment Date and shall be automatically exercised in successive installments
on the Exercise Dates ending within the Offer Period.

          (c)  If on the first day of any Purchase Period in an Offer Period in
which a Participant is participating, the Fair Market Value of the Common Stock
is less than the Fair Market Value of the Common Stock on the Enrollment Date of
the Offer Period (after taking into account any adjustment during the Offer
Period pursuant to Section 18(a)), the Offer Period shall be terminated
automatically and the Participant shall be enrolled automatically in the new
Offer Period which has its first Purchase Period commencing on that date,
provided the Participant is eligible to participate in the Plan on that date and
has not elected to terminate participation in the Plan.

          (d)  Except as specifically provided herein, the acquisition of Common
Stock through participation in the Plan for any Offer Period shall neither limit
nor require the acquisition of Common Stock by a Participant in any subsequent
Offer Period.

          5.   Participation.
               -------------

          (a)  All Employees eligible to participate in the Plan as of the first
Enrollment Date of the Plan shall automatically become a Participant in the
initial Offer Period and be eligible to make a direct payment for shares of the
Common Stock on the Exercise Date of the first Purchase Period of the initial
Offer Period in an amount equal to the lesser of the aggregate Purchase Price
for six hundred twenty-five (625) shares of the Common Stock or ten percent
(10%) of the Compensation that he or she receives during the first Purchase
Period of the initial Offer Period, unless a change of status notice in the form
of Exhibit C to this Plan (or such other

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form (including electronic forms) as determined by the Administrator from time
to time) is filed to the contrary or the Participant withdraws from the Plan as
provided in Section 10. No subscription agreement need be filed by the
Participant with the Company in order to participate in the initial Offer
Period.

          (b)  After the initial Offer Period, an eligible Employee may become a
Participant in the Plan by completing a subscription agreement authorizing
payroll deductions in the form of Exhibit A to this Plan (or such other form
(including electronic forms) as determined by the Administrator from time to
time) and filing it with the designated payroll office of the Company at least
three (3) business days prior to the Enrollment Date for the Offer Period in
which such participation will commence, unless a later time for filing the
subscription agreement is set by the Administrator for all eligible Employees
with respect to a given Offer Period.

          (c)  No payroll deductions shall be made for Participants during the
first Purchase Period of the initial Offer Period, unless a change of status
notice in the form of Exhibit C to this Plan (or such other form (including
electronic forms) as determined by the Administrator from time to time)
authorizing the commencement of payroll deductions is filed by the Participant
with the Company after a registration statement on Form S-8 has been filed with
the Securities Exchange Commission with respect to the shares being offered
under the Plan.  If so elected, the rate of payroll deductions during the first
Purchase Period of the initial Offer Period may exceed the maximum permitted
rate under Section 6(a) to make-up for missed payroll deductions that would
otherwise have been made prior to the filing of the Form S-8 with respect to the
Plan.  Payroll deductions for a Participant in the initial Offer Period shall
commence at the rate elected by the Participant under Section 6(a) with the
first partial or full payroll period beginning on the first day of the second
Purchase Period of the initial Offer Period and shall end on the last complete
payroll period during the initial Offer Period, unless a change of status notice
in the form of Exhibit B (or such other form (including electronic forms) as
determined by the Administrator from time to time) is filed to the contrary or
the Participant withdraws from the Plan as provided in Section 10.  No direct
payment for shares shall be permitted after the first Purchase Period of the
initial Offer Period.  Therefore, Participants in the initial Offer Period must
file the change of status notice in the form of Exhibit C to this Plan (or such
other form (including electronic forms) as determined by the Administrator from
time to time) prior to the commencement of the second Purchase Period of the
initial Offer Period to assure maximum participation rights under the Plan.

          (d)  For Offer Periods, other than the initial Offer Period, payroll
deductions for a Participant shall commence with the first partial or full
payroll period beginning on the Enrollment Date and shall end on the last
complete payroll period during the Offer Period, unless sooner terminated by the
Participant as provided in Section 10.

          6.   Payroll Deductions.
               ------------------

          (a)  At the time a Participant files a subscription agreement, the
Participant shall elect to have payroll deductions made during the Offer Period
in amounts between one percent (1%) and not exceeding ten percent (10%) of the
Compensation which the Participant receives during the Offer Period.

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          (b)  All payroll deductions made for a Participant shall be credited
to the Participant's account under the Plan and will be withheld in whole
percentages only. A Participant may not make any additional payments into such
account.

          (c)  A Participant may discontinue participation in the Plan as
provided in Section 10, or may increase or decrease the rate of payroll
deductions during the Offer Period by completing and filing with the Company a
change of status notice in the form of Exhibit B to this Plan (or such other
form (including electronic forms) as determined by the Administrator from time
to time) authorizing an increase or decrease in the payroll deduction rate.
During the first Purchase Period of the initial Offer Period, a Participant may
discontinue participation in the Plan as provided in Section 10 or initiate
payroll deductions by completing and filing with the Company a change of status
notice in the form of Exhibit C to this Plan (or such other form (including
electronic forms) as determined by the Administrator from time to time).  Any
increase or decrease in the rate of a Participant's payroll deductions shall be
effective with the first full payroll period commencing three (3) business days
after the Company's receipt of the change of status notice unless the Company
elects to process a given change in participation more quickly.  A Participant's
subscription agreement (as modified by any change of status notice) shall remain
in effect for successive Offer Periods unless terminated as provided in Section
10.  The Administrator shall be authorized to limit the number of payroll
deduction rate changes during any Offer Period.

          (d)  Notwithstanding the foregoing, to the extent necessary to comply
with Section 423(b)(8) of the Code and Section 3(b) herein, a Participant's
payroll deductions shall be decreased to 0%.  Payroll deductions shall
recommence at the rate provided in such Participant's subscription agreement, as
amended, at the time when permitted under Section 423(b)(8) of the Code and
Section 3(b) herein, unless such participation is sooner terminated by the
Participant as provided in Section 10.

          7.   Grant of Option.  On the Enrollment Date, each Participant shall
               ---------------
be granted an option to purchase (at the applicable Purchase Price) two thousand
five hundred (2,500) shares of the Common Stock, subject to adjustment as
provided in Section 18 hereof; provided (i) that such option shall be subject to
the limitations set forth in Sections 3(b), 6 and 12 hereof, and (ii) the
maximum number of shares of Common Stock a Participant shall be permitted to
purchase in any Purchase Period shall be six hundred twenty-five (625) shares,
subject to adjustment as provided in Section 18 hereof.  Exercise of the option
shall occur as provided in Section 8, unless the Participant has withdrawn
pursuant to Section 10, and the option, to the extent not exercised, shall
expire on the last day of the Offer Period.

          8.   Exercise of Option.  Unless a Participant withdraws from the Plan
               ------------------
as provided in Section 10, below, the Participant's option for the purchase of
shares will be exercised automatically on each Exercise Date, by applying the
accumulated payroll deductions in the Participant's account to purchase the
number of full shares subject to the option by dividing such Participant's
payroll deductions accumulated prior to such Exercise Date and retained in the
Participant's account as of the Exercise Date by the applicable Purchase Price,
provided, however, that if a Participant is eligible to purchase any shares on
the first Exercise Date of the initial Offer Period by direct payment, the
Participant's option for the purchase of

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shares will be exercised to the extent possible by applying the direct payment
amount made by the Participant to purchase the number of full shares subject to
the option by dividing such direct payment amount by the applicable Purchase
Price and, provided, further, in no event may the accumulated payroll deductions
and direct payment amounts applied to the purchase of shares on the first
Exercise Date of the initial Offer Period exceed the amount specified in Section
5(a). No fractional shares will be purchased; any payroll deductions accumulated
in a Participant's account which are not sufficient to purchase a full share
shall be carried over to the next Purchase Period or Offer Period, whichever
applies, or returned to the Participant, if the Participant withdraws from the
Plan. Any direct payment amounts which are not sufficient to purchase a full
share shall be returned to the Participant. Notwithstanding the foregoing, any
amount remaining in a Participant's account or any excess direct payment amount
following the purchase of shares on the Exercise Date due to the application of
Section 423(b)(8) of the Code or Section 7, above, shall be returned to the
Participant and shall not be carried over to the next Offer Period or Purchase
Period. During a Participant's lifetime, a Participant's option to purchase
shares hereunder is exercisable only by the Participant.

          9.   Delivery.  Upon receipt of a request from a Participant after
               --------
each Exercise Date on which a purchase of shares occurs, the Company shall
arrange the delivery to such Participant, as promptly as practicable, of a
certificate representing the shares purchased upon exercise of the Participant's
option.

          10.  Withdrawal; Termination of Employment.
               -------------------------------------

          (a)  A Participant may either (i) withdraw all but not less than all
the payroll deductions credited to the Participant's account and not yet used to
exercise the Participant's option under the Plan or (ii) terminate future
payroll deductions, but allow accumulated payroll deductions to be used to
exercise the Participant's option under the Plan at any time by giving written
notice to the Company in the form of Exhibit B to this Plan (or such other form
(including electronic forms) as determined by the Administrator from time to
time).  During the first Purchase Period of the initial Offer Period, a
Participant may elect to withdraw from the Plan and not purchase shares by
direct payment by giving written notice to the Company in the form of Exhibit C
to this Plan (or such other form (including electronic forms) as determined by
the Administrator from time to time).  If the Participant elects withdrawal
alternative (i) described above, all of the Participant's payroll deductions
credited to the Participant's account will be paid to such Participant as
promptly as practicable after receipt of notice of withdrawal, such
Participant's option for the Offer Period will be automatically terminated, and
no further payroll deductions for the purchase of shares will be made during the
Offer Period.  If the Participant elects withdrawal alternative (ii) described
above, no further payroll deductions for the purchase of shares will be made
during the Offer Period, all of the Participant's payroll deductions credited to
the Participant's account will be applied to the exercise of the Participant's
option on the next Exercise Date, and after such Exercise Date, such
Participant's option for the Offer Period will be automatically terminated.  If
a Participant withdraws from an Offer Period, payroll deductions will not resume
at the beginning of the succeeding Offer Period unless the Participant delivers
to the Company a new subscription agreement.

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          (b)  Upon termination of a Participant's employment relationship (as
described in Section 2(k)) at a time more than three (3) months from the next
scheduled Exercise Date, the payroll deductions credited to such Participant's
account during the Offer Period but not yet used to exercise the option will be
returned to such Participant or, in the case of his/her death, to the person or
persons entitled thereto under Section 14, and such Participant's option will be
automatically terminated.  Upon termination of a Participant's employment
relationship (as described in Section 2(k)) within three (3) months of the next
scheduled Exercise Date, the payroll deductions credited to such Participant's
account during the Offer Period but not yet used to exercise the option will be
applied to the purchase of Common Stock on the next Exercise Date, unless the
Participant (or in the case of the Participant's death, the person or persons
entitled to the Participant's account balance under Section 14) withdraws from
the Plan by submitting a change of status notice in accordance with subsection
(a) of this Section 10.  In such a case, no further payroll deductions will be
credited to the Participant's account following the Participant's termination of
employment and the Participant's option under the Plan will be automatically
terminated after the purchase of Common Stock on the next scheduled Exercise
Date.

          11.  Interest.  No interest shall accrue on the payroll deductions
               --------
credited to a Participant's account under the Plan.

          12.  Stock.
               -----

          (a)  Subject to adjustment upon changes in capitalization of the
Company as provided in Section 18, the maximum number of shares of Common Stock
which shall be made available for sale under the Plan shall be two million
(2,000,000) shares, plus an annual increase to be added on the first day of the
Company's fiscal year beginning in 2002 equal to the lesser of (i) one million
five hundred thousand (1,500,000) shares, (ii) two percent (2%) of the
outstanding shares of Common Stock on such date, or (iii) a lesser number of
shares determined by the Administrator.  If the Administrator determines that on
a given Exercise Date the number of shares with respect to which options are to
be exercised may exceed (x) the number of shares then available for sale under
the Plan or (y) the number of shares available for sale under the Plan on the
Enrollment Date(s) of one or more of the Offer Periods in which such Exercise
Date is to occur, the Administrator may make a pro rata allocation of the shares
remaining available for purchase on such Enrollment Dates or Exercise Date, as
applicable, in as uniform a manner as shall be practicable and as it shall
determine to be equitable, and shall either continue all Offer Periods then in
effect or terminate any one or more Offer Periods then in effect pursuant to
Section 19, below.

          (b)  A Participant will have no interest or voting right in shares
covered by the Participant's option until such shares are actually purchased on
the Participant's behalf in accordance with the applicable provisions of the
Plan.  No adjustment shall be made for dividends, distributions or other rights
for which the record date is prior to the date of such purchase.

          (c)  Shares to be delivered to a Participant under the Plan will be
registered in the name of the Participant or in the name of the Participant and
his or her spouse.

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          13.  Administration.  The Plan shall be administered by the
               --------------
Administrator which shall have full and exclusive discretionary authority to
construe, interpret and apply the terms of the Plan, to determine eligibility
and to adjudicate all disputed claims filed under the Plan.  Every finding,
decision and determination made by the Administrator shall, to the full extent
permitted by Applicable Law, be final and binding upon all persons.

          14.  Designation of Beneficiary.
               --------------------------

          (a)  Each Participant will file a written designation of a beneficiary
who is to receive any shares and cash, if any, from the Participant's account
under the Plan in the event of such Participant's death.  If a Participant is
married and the designated beneficiary is not the spouse, spousal consent shall
be required for such designation to be effective.

          (b)  Such designation of beneficiary may be changed by the Participant
(and the Participant's spouse, if any) at any time by written notice.  In the
event of the death of a Participant and in the absence of a beneficiary validly
designated under the Plan who is living (or in existence) at the time of such
Participant's death, the Company shall deliver such shares and/or cash to the
executor or administrator of the estate of the Participant, or if no such
executor or administrator has been appointed (to the knowledge of the
Administrator), the Administrator shall deliver such shares and/or cash to the
spouse (or domestic partner, as determined by the Administrator) of the
Participant, or if no spouse (or domestic partner) is known to the
Administrator, then to the issue of the Participant, such distribution to be
made per stirpes (by right of representation), or if no issue are known to the
Administrator, then to the heirs at law of the Participant determined in
accordance with Section 27.

          15.  Transferability.  Neither payroll deductions credited to a
               ---------------
Participant's account nor any rights with regard to the exercise of an option or
to receive shares under the Plan may be assigned, transferred, pledged or
otherwise disposed of in any way (other than by will, the laws of descent and
distribution, or as provided in Section 14 hereof) by the Participant.  Any such
attempt at assignment, transfer, pledge or other disposition shall be without
effect, except that the Administrator may treat such act as an election to
withdraw funds from an Offer Period in accordance with Section 10.

          16.  Use of Funds.  All payroll deductions received or held by the
               ------------
Company under the Plan may be used by the Company for any corporate purpose, and
the Company shall not be obligated to segregate such payroll deductions.

          17.  Reports.  Individual accounts will be maintained for each
               -------
Participant in the Plan.  Statements of account will be given to Participants at
least annually, which statements will set forth the amounts of payroll
deductions, the Purchase Price, the number of shares purchased and the remaining
cash balance, if any.

          18.  Adjustments Upon Changes in Capitalization; Corporate
               -----------------------------------------------------
Transactions.
------------

          (a)  Adjustments Upon Changes in Capitalization.  Subject to any
               ------------------------------------------
required action by the stockholders of the Company, the Reserves, the Purchase
Price, the maximum

                                       10
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number of shares that may be purchased in any Offer Period or Purchase Period,
as well as any other terms that the Administrator determines require adjustment
shall be proportionately adjusted for (i) any increase or decrease in the number
of issued shares of Common Stock resulting from a stock split, reverse stock
split, stock dividend, combination or reclassification of the Common Stock, (ii)
any other increase or decrease in the number of issued shares of Common Stock
effected without receipt of consideration by the Company, or (iii) as the
Administrator may determine in its discretion, any other transaction with
respect to Common Stock to which Section 424(a) of the Code applies; provided,
however that conversion of any convertible securities of the Company shall not
be deemed to have been "effected without receipt of consideration." Such
adjustment shall be made by the Administrator and its determination shall be
final, binding and conclusive. Except as the Administrator determines, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason hereof shall be made with respect to, the Reserves and the Purchase
Price.

          (b)  Corporate Transactions.  In the event of a proposed Corporate
               ----------------------
Transaction, each option under the Plan shall be assumed by such successor
corporation or a parent or subsidiary of such successor corporation, unless the
Administrator, in the exercise of its sole discretion and in lieu of such
assumption, determines to shorten the Offer Period then in progress by setting a
new Exercise Date (the "New Exercise Date").  If the Administrator shortens the
Offer Period then in progress in lieu of assumption in the event of a Corporate
Transaction, the Administrator shall notify each Participant in writing at least
ten (10) business days prior to the New Exercise Date, that the Exercise Date
for the Participant's option has been changed to the New Exercise Date and that
either:
------

          (i)  the Participant's option will be exercised automatically on the
     New Exercise Date, unless prior to such date the Participant has withdrawn
     from the Offer Period as provided in Section 10; or

          (ii) the Company shall pay to the Participant on the New Exercise Date
     an amount in cash, cash equivalents, or property as determined by the
     Administrator that is equal to the difference in the Fair Market Value of
     the shares subject to the option and the Purchase Price due had the
     Participant's option been exercised automatically under Subsection (b)(i)
     above.

          For purposes of this Subsection, an option granted under the Plan
shall be deemed to be assumed if, in connection with the Corporate Transaction,
the option is replaced with a comparable option with respect to shares of
capital stock of the successor corporation or Parent thereof.  The determination
of option comparability shall be made by the Administrator prior to the
Corporate Transaction and its determination shall be final, binding and
conclusive on all persons.

          19.  Amendment or Termination.
               ------------------------

          (a)  The Administrator may at any time and for any reason terminate or
amend the Plan. Except as provided in Section 18, no such termination can affect
options previously

                                       11
<PAGE>

granted, provided that the Plan or any one or more Offer Periods may be
terminated by the Administrator on any Exercise Date or by the Administrator
establishing a new Exercise Date with respect to any Offer Period and/or any
Purchase Period then in progress if the Administrator determines that the
termination of the Plan or such one ore more Offer Periods is in the best
interests of the Company and its stockholders. Except as provided in Section 18
and this Section 19, no amendment may make any change in any option theretofore
granted which adversely affects the rights of any Participant without the
consent of affected Participants. To the extent necessary to comply with Section
423 of the Code (or any successor rule or provision or any other Applicable
Law), the Company shall obtain stockholder approval in such a manner and to such
a degree as required.

          (b)  Without stockholder consent and without regard to whether any
Participant rights may be considered to have been "adversely affected," the
Administrator shall be entitled to limit the frequency and/or number of changes
in the amount withheld during Offer Periods, change the length of Purchase
Periods within any Offer Period, determine the length of any future Offer
Period, determine whether future Offer Periods shall be consecutive or
overlapping, establish the exchange ratio applicable to amounts withheld in a
currency other than U.S. dollars, establish additional terms, conditions, rules
or procedures to accommodate the rules or laws of applicable foreign
jurisdictions, permit payroll withholding in excess of the amount designated by
a Participant in order to adjust for delays or mistakes in the Company's
processing of properly completed withholding elections, establish reasonable
waiting and adjustment periods and/or accounting and crediting procedures to
ensure that amounts applied toward the purchase of Common Stock for each
Participant properly correspond with amounts withheld from the Participant's
Compensation, and establish such other limitations or procedures as the
Administrator determines in its sole discretion advisable and which are
consistent with the Plan.

          20.  Notices.  All notices or other communications by a Participant to
               -------
the Company under or in connection with the Plan shall be deemed to have been
duly given when received in the form specified by the Administrator at the
location, or by the person, designated by the Administrator for the receipt
thereof.

          21.  Conditions Upon Issuance of Shares.  Shares shall not be issued
               ----------------------------------
with respect to an option unless the exercise of such option and the issuance
and delivery of such shares pursuant thereto shall comply with all Applicable
Laws and shall be further subject to the approval of counsel for the Company
with respect to such compliance. As a condition to the exercise of an option,
the Company may require the Participant to represent and warrant at the time of
any such exercise that the shares are being purchased only for investment and
without any present intention to sell or distribute such shares if, in the
opinion of counsel for the Company, such a representation is required by any of
the aforementioned Applicable Laws. In addition, no options shall be exercised
or shares issued hereunder before the Plan shall have been approved by
stockholders of the Company as provided in Section 23.

          22.  Term of Plan.  The Plan shall become effective upon the earlier
               ------------
to occur of its adoption by the Board or its approval by the stockholders of the
Company.  It shall continue in effect for a term of twenty (20) years unless
sooner terminated under Section 19.

                                       12
<PAGE>

          23.  Stockholder Approval.  Continuance of the Plan shall be subject
               --------------------
to approval by the stockholders of the Company within twelve (12) months before
or after the date the Plan is adopted.  Such stockholder approval shall be
obtained in the degree and manner required under Applicable Laws.

          24.  No Employment Rights.  The Plan does not, directly or indirectly,
               --------------------
create any right for the benefit of any employee or class of employees to
purchase any shares under the Plan, or create in any employee or class of
employees any right with respect to continuation of employment by the Company or
a Designated Parent or Subsidiary, and it shall not be deemed to interfere in
any way with such employer's right to terminate, or otherwise modify, an
employee's employment at any time.

          25.  No Effect on Retirement and Other Benefit Plans.  Except as
               -----------------------------------------------
specifically provided in a retirement or other benefit plan of the Company or a
Designated Parent or Subsidiary, participation in the Plan shall not be deemed
compensation for purposes of computing benefits or contributions under any
retirement plan of the Company or a Designated Parent or Subsidiary, and shall
not affect any benefits under any other benefit plan of any kind or any benefit
plan subsequently instituted under which the availability or amount of benefits
is related to level of compensation.  The Plan is not a "Retirement Plan" or
"Welfare Plan" under the Employee Retirement Income Security Act of 1974, as
amended.

          26.  Effect of Plan.  The provisions of the Plan shall, in accordance
               --------------
with its terms, be binding upon, and inure to the benefit of, all successors of
each Participant, including, without limitation, such Participant's estate and
the executors, administrators or trustees thereof, heirs and legatees, and any
receiver, trustee in bankruptcy or representative of creditors of such
Participant.

          27.  Governing Law.  The Plan is to be construed in accordance with
               -------------
and governed by the internal laws of the State of California (as permitted by
Section 1646.5 of the California Civil Code, or any similar successor provision)
without giving effect to any choice of law rule that would cause the application
of the laws of any jurisdiction other than the internal laws of the State of
California to the rights and duties of the parties, except to the extent the
internal laws of the State of California are superseded by the laws of the
United States.  Should any provision of the Plan be determined by a court of law
to be illegal or unenforceable, the other provisions shall nevertheless remain
effective and shall remain enforceable.

          28.  Dispute Resolution.  The provisions of this Section 28 (and as
               ------------------
restated in the Subscription Agreement) shall be the exclusive means of
resolving disputes arising out of or relating to the Plan.  The Company and the
Participant, or their respective successors (the "parties"), shall attempt in
good faith to resolve any disputes arising out of or relating to the Plan by
negotiation between individuals who have authority to settle the controversy.
Negotiations shall be commenced by either party by notice of a written statement
of the party's position and the name and title of the individual who will
represent the party.  Within thirty (30) days of the written notification, the
parties shall meet at a mutually acceptable time and place, and thereafter as
often as they reasonably deem necessary, to resolve the dispute.  If the dispute
has not been resolved by negotiation, the parties agree that any suit, action,
or proceeding arising out of or

                                       13
<PAGE>

relating to the Plan shall be brought in the United States District Court for
the Central District of California (or should such court lack jurisdiction to
hear such action, suit or proceeding, in a California state court in the County
of Los Angeles) and that the parties shall submit to the jurisdiction of such
court. The parties irrevocably waive, to the fullest extent permitted by law,
any objection the party may have to the laying of venue for any such suit,
action or proceeding brought in such court. THE PARTIES ALSO EXPRESSLY WAIVE ANY
RIGHT THEY HAVE OR MAY HAVE TO A JURY TRIAL OF ANY SUCH SUIT, ACTION OR
PROCEEDING. If any one or more provisions of this Section 28 shall for any
reason be held invalid or unenforceable, it is the specific intent of the
parties that such provisions shall be modified to the minimum extent necessary
to make it or its application valid and enforceable.

                                       14
<PAGE>

                                   Exhibit A

        American Pharmaceutical Partners, Inc. 2001 Employee Stock Purchase Plan
                                                          SUBSCRIPTION AGREEMENT

                                   Effective with the Offer Period beginning on:
                                   [_] (January 1, 200_)  or  [_] (July 1, 200_)

<TABLE>
<S>                                                                                     <C>
1. Personal Information (modify data requested as appropriate)

   Legal Name (Please Print)________________________________________________________    ___________________   ___________________
                                   (Last)            (First)             (MI)            Location              Department
   Street Address___________________________________________________________________    _________________________________________
                                                                                         Daytime Telephone
   City, State/Country, Zip__________________________________________________________   _________________________________________
                                                                                          E-Mail Address
   Social Security No. __ __ __ - __ __ - __ __ __   Employee I.D. No. ______________   _________________________________________
                                                                                           Manager                  Mgr. Location
</TABLE>

2. Eligibility   Any Employee whose customary employment is more than 20 hours
   per week and more than 5 months per calendar year, who has been an Employee
   for more than 3 business days and who does not hold (directly or indirectly)
   five percent (5%) or more of the combined voting power of the Company, a
   parent or a subsidiary, whether in stock or options to acquire stock is
   eligible to participate in the American Pharmaceutical Partners, Inc. 2001
   Employee Stock Purchase Plan (the "ESPP"); provided, however, that Employees
   who are subject to the rules or laws of a foreign jurisdiction that prohibit
   or make impractical the participation of such Employees in the ESPP are not
   eligible to participate.

3. Definitions  Each capitalized term in this Subscription Agreement shall have
   the meaning set forth in the ESPP.

4. Subscription  I hereby elect to participate in the ESPP and subscribe to
   purchase shares of the Company's Common Stock in accordance with this
   Subscription Agreement and the ESPP. I have received a complete copy of the
   ESPP and a prospectus describing the ESPP and understand that my
   participation in the ESPP is in all respects subject to the terms of the
   ESPP. The effectiveness of this Subscription Agreement is dependent on my
   eligibility to participate in the ESPP.

5. Payroll Deduction Authorization  I hereby authorize payroll deductions from
   my Compensation during the Offer Period in the percentage specified below
   (payroll reductions may not exceed 10% of Compensation nor $21,250 per
   calendar year):

   -----------------------------------------------------------------------------
    Percentage to be deducted (circle one) 1%  2% 3%  4%  5%  6%  7%  8%  9% 10%
   -----------------------------------------------------------------------------

6. ESPP Accounts and Purchase  I understand that all payroll deductions will be
   credited to my account Price under the ESPP. No additional payments may be
   made to my account. No interest will be credited on funds held in the account
   at any time including any refund of the account caused by withdrawal from the
   ESPP. All payroll deductions shall be accumulated for the purchase of Company
   Common Stock at the applicable Purchase Price determined in accordance with
   the ESPP.

7. Withdrawal and Changes in Payroll Deduction   I understand that I may
   discontinue my participation in the ESPP at any time prior to an Exercise
   Date as provided in Section 10 of the ESPP, but if I do not withdraw from the
   ESPP, any accumulated payroll deductions will be applied automatically to
   purchase Company Common Stock. I may increase or decrease the rate of my
   payroll deductions in whole percentage increments to not less than one
   percent (1%) on one occasion during any Purchase Period by completing and
   timely filing a Change of Status Notice. Any increase or decrease will be
   effective for the full payroll period occurring after three (3) business days
   from the Company's receipt of the Change of Status Notice.

8. Perpetual Subscription  I understand that this Subscription Agreement shall
   remain in effect for successive Offer Periods until I withdraw from
   participation in the ESPP, or termination of the ESPP.

                                      A-1
<PAGE>

9.   Taxes I have reviewed the ESPP prospectus discussion of the federal tax
     consequences of participation in the ESPP and consulted with tax
     consultants as I deemed advisable prior to my participation in the ESPP. I
     hereby agree to notify the Company in writing within thirty (30) days of
     any disposition (transfer or sale) of any shares purchased under the ESPP
     if such disposition occurs within two (2) years of the Enrollment Date (the
     first day of the Offer Period during which the shares were purchased) or
     within one (1) year of the Exercise Date (the date I purchased such
     shares), and I will make adequate provision to the Company for foreign,
     federal, state or other tax withholding obligations, if any, which arise
     upon the disposition of the shares. In addition, the Company may withhold
     from my Compensation any amount necessary to meet applicable tax
     withholding obligations incident to my participation in the ESPP, including
     any withholding necessary to make available to the Company any tax
     deductions or benefits contingent on such withholding.

10.  Dispute Resolution The provisions of this Section 10 and Section 28 of the
     ESPP shall be the exclusive means of resolving disputes arising out of or
     relating to the Plan. The Company and I, or our respective successors (the
     "parties"), shall attempt in good faith to resolve any disputes arising out
     of or relating to the Plan by negotiation between individuals who have
     authority to settle the controversy. Negotiations shall be commenced by
     either party by notice of a written statement of the party's position and
     the name and title of the individual who will represent the party. Within
     thirty (30) days of the written notification, the parties shall meet at a
     mutually acceptable time and place, and thereafter as often as they
     reasonably deem necessary, to resolve the dispute. If the dispute has not
     been resolved by negotiation, the Company and I agree that any suit,
     action, or proceeding arising out of or relating to the Plan shall be
     brought in the United States District Court for the Central District of
     California (or should such court lack jurisdiction to hear such action,
     suit or proceeding, in a California state court in the County of Los
     Angeles) and that we shall submit to the jurisdiction of such court. The
     Company and I irrevocably waive, to the fullest extent permitted by law,
     any objection we may have to the laying of venue for any such suit, action
     or proceeding brought in such court. THE COMPANY AND I ALSO EXPRESSLY WAIVE
     ANY RIGHT WE HAVE OR MAY HAVE TO A JURY TRIAL OF ANY SUCH SUIT, ACTION OR
     PROCEEDING. If any one or more provisions of this Section 10 or Section 28
     of the ESPP shall for any reason be held invalid or unenforceable, it is
     the specific intent of the Company and I that such provisions shall be
     modified to the minimum extent necessary to make it or its application
     valid and enforceable.

11.  Designation of Beneficiary In the event of my death, I hereby designate the
     following person or trust as my beneficiary to receive all payments and
     shares due to me under the ESPP:    [_] I am single        [_] I am married

<TABLE>
<S>                                                                           <C>
  Beneficiary (please print) ________________________________________________ Relationship to Beneficiary (if any)
                                    (Last)          (First)         (MI)
  Street Address ____________________________________________________________ ___________________________________
  City, State/Country, Zip __________________________________________________
</TABLE>

12.  Termination of ESPP I understand that the Company has the right,
     exercisable in its sole discretion, to amend or terminate the ESPP at any
     time, and a termination may be effective as early as an Exercise Date,
     including the establishment of an alternative date for an Exercise Date
     within each outstanding Offer Period.

     Date:__________________   Employee Signature:______________________________

                                               _________________________________

                                               spouse's signature (if
                                               beneficiary is other than spouse)

                                      A-2
<PAGE>

                                   Exhibit B

        American Pharmaceutical Partners, Inc. 2001 Employee Stock Purchase Plan
                                                         CHANGE OF STATUS NOTICE

______________________________________________________
Participant Name (Please Print)

______________________________________________________
Social Security Number

================================================================================

     Withdrawal From ESPP

     I hereby withdraw from the American Pharmaceutical Partners, Inc. 2001
     Employee Stock Purchase Plan (the "ESPP") and agree that my option under
     the applicable Offer Period will be automatically terminated and all
     accumulated payroll deductions credited to my account will be refunded to
     me or applied to the purchase of Common Stock depending on the alternative
     indicated below.  No further payroll deductions will be made for the
     purchase of shares in the applicable Offer Period and I shall be eligible
     to participate in a future Offer Period only by timely delivery to the
     Company of a new Subscription Agreement.

[_]  Withdrawal and Purchase of Common Stock

     Payroll deductions will terminate, but your account balance will be applied
     to purchase Common Stock on the next Exercise Date.  Any remaining balance
     will be refunded.

[_]  Withdrawal Without Purchase of Common Stock

     Entire account balance will be refunded to me and no Common Stock will be
     purchased on the next Exercise Date provided this notice is submitted to
     the Company ten (10) business days prior to the next Exercise Date.

================================================================================

[_]  Change in Payroll Deduction

     I hereby elect to change my rate of payroll deduction under the ESPP as
     follows (select one):

<TABLE>
--------------------------------------------------------------------------------
<S>                                     <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Percentage to be Deducted (circle one)  1%  2%  3%  4%  5%  6%  7%  8%  9%  10%
--------------------------------------------------------------------------------
</TABLE>

     An increase or a decrease in payroll deduction will be effective for the
     first full payroll period commencing no fewer than three (3) business days
     following the Company's receipt of this notice, unless this change is
     processed more quickly.

================================================================================

                                      B-1
<PAGE>

================================================================================
[_]  Change of Beneficiary           [_] I am single         [_]  I am married

     This change of beneficiary shall terminate my previous beneficiary
     designation under the ESPP.  In the event of my death, I hereby designate
     the following person or trust as my beneficiary to receive all payments and
     shares due to me under the ESPP:

<TABLE>
<S>                                                                        <C>
    Beneficiary (please print) __________________________________________ Relationship to Beneficiary (if any)
                                    (Last)         (First)      (MI)

    Street Address ______________________________________________________ _____________________________________

    City, State/Country, Zip ____________________________________________
</TABLE>

================================================================================

 Date:_____________________ Employee Signature:_________________________________

                                               _________________________________
                                               spouse's signature (if new
                                               beneficiary is other than spouse)

                                      B-2
<PAGE>

                                   Exhibit C

        American Pharmaceutical Partners, Inc. 2001 Employee Stock Purchase Plan
                                                         CHANGE OF STATUS NOTICE
                        DURING FIRST PURCHASE PERIOD OF THE INITIAL OFFER PERIOD

__________________________________________
Participant Name (Please Print)

__________________________________________
Social Security Number

================================================================================
     Withdrawal From ESPP

     I hereby withdraw from the American Pharmaceutical Partners, Inc. 2001
     Employee Stock Purchase Plan (the "ESPP") and agree that my option under
     the applicable Offer Period will be automatically terminated.  No payroll
     deductions will be made for the purchase of shares in the initial Offer
     Period and I shall be eligible to participate in a future Offer Period only
     by timely delivery to the Company of a new Subscription Agreement.

[_]  Withdrawal Without Purchase by Direct Payment

     I elect not to purchase shares by direct payment during the first Purchase
     Period of the initial Offer Period.

================================================================================

[_]  Initiate Payroll Deduction During First Purchase Period of Initial Offer
     Period

     I hereby elect to initiate payroll deduction under the ESPP as follows
     (select one):

<TABLE>
--------------------------------------------------------------------------------
<S>                                     <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Percentage to be Deducted (circle one)  1%  2%  3%  4%  5%  6%  7%  8%  9%  10%
--------------------------------------------------------------------------------
</TABLE>

     To the extent possible, the rate of payroll deduction will exceed the
     percentage indicated to yield the correct amount of withholding on the
     Exercise Date to cover payroll periods during which no withholding for
     participation in the Plan was made.

     I understand that this notice and payroll withholding rate shall remain in
     effect for successive Offer Periods until I withdraw from participation in
     the ESPP, change withholding rates, or the ESPP terminates.

     An increase or a decrease in payroll deduction or direct payment percentage
     will be effective for the first full payroll period commencing no fewer
     than three (3) business days following the Company's receipt of this
     notice, unless this change is processed more quickly.

================================================================================

                                      C-1
<PAGE>

================================================================================
Designation of Beneficiary

In the event of my death, I hereby designate the following person or trust as my
beneficiary to receive all payments and shares due to me under the ESPP:
[_] I am single     [_] I am married

<TABLE>
<S>                                                                        <C>
  Beneficiary (please print) ____________________________________________  Relationship to Beneficiary (if any)
                                 (Last)      (First)           (MI)

  Street Address ________________________________________________________  ____________________________________

  City, State/Country, Zip ______________________________________________
</TABLE>

================================================================================

  Date:___________________  Employee Signature:_________________________________

                                               _________________________________
                                               spouse's signature (if new
                                               beneficiary is other than spouse)

                                      C-2<PAGE>

                                                                   EXHIBIT 10.11

                               LICENSE AGREEMENT
                               -----------------

     This License Agreement (this "Agreement") is entered into as of November
                                   ---------
20, 2001 (the "Effective Date"), by and between American BioScience, Inc., a
               --------------
California corporation ("ABI") and American Pharmaceutical Partners, Inc., a
California corporation ("APP").
                         ---

                                   RECITALS
                                   --------

     A.  ABI has developed and owns the rights to the Product, as defined in

Section 1.21 of this Agreement.
------------

     B.  APP is in the business of manufacturing, marketing and distributing
pharmaceutical Products in the United States and elsewhere in the world, and has
special expertise in oncolytics.

     C.  The Parties desire to enter into an agreement for APP to market,
distribute and sell the Product under a license from ABI.

                                   AGREEMENT
                                   ---------

     In consideration of the premises, the mutual covenants contained herein,
and other good and valuable consideration, the receipt and sufficiency of which
is acknowledged, the Parties agree as follows:

     1.  Definitions.  As used in this Agreement (in addition to other
         -----------
definitions set forth in this Agreement), the following definitions shall apply:

               1.1  "ABI Parties means ABI, its Affiliates, permitted assignees
                     -----------
and any party (if any) licensed or approved by ABI to use, market, distribute,
import, export, sell or offer to sell the Product with the exception of the APP
Parties.

               1.2  "Action" means any actual or threatened claim, suit,
                     ------
arbitration, hearing, inquiry, proceeding, complaint, charge or investigation by
or before any court, government, governmental entity or arbitrator.

               1.3  "Affiliate" means any entity controlling, controlled by or
                     ---------
under the common control of APP or ABI, as the case may be. Such entity will be
considered an Affiliate only for the time during which such control exists. For
the purpose of this Agreement, "control" means having, directly or indirectly,
the power to direct or cause the direction of management and policies of such
entity. FOR PURPOSES OF THIS AGREEMENT, APP WILL NOT BE CONSIDERED AN AFFILIATE
OF ABI, AND ABI WILL NOT BE CONSIDERED AN AFFILIATE OF APP.

               1.4  "APP Parties" or "APP Party" means any of APP, its
                     -----------
Affiliates and its permitted sublicensees and assignees.

               1.5  "Chargeable Price" means, with respect to Product
                     ----------------
manufactured by APP, the Standard Costs per unit of Product, and with respect to
Product not manufactured by APP, the

[***]  Omitted pursuant to a confidential agreement request. The material has
been filed separately with the Securities and Exchange Commisson.

<PAGE>

price APP pays for the Product from ABI's designated manufacturer(s) plus the
reasonable costs of quality control and other activities performed by APP that
would be included in Standard Costs if APP were the manufacturer.

               1.6   "Chemical Ingredients" means paclitaxel and albumin.
                      --------------------

               1.7   "Competitor" means a business entity that markets and sells
                      ----------
a pharmaceutical Product that includes taxanes as an active pharmaceutical
ingredient.

               1.8   "Damages" means any and all losses, liabilities,
                      -------
obligations, costs, expenses, damages or judgments of any kind or nature
whatsoever including reasonable attorneys', accountants' and experts' fees,
disbursements of counsel and other costs and expenses incurred in pursuing or
defending claims under this Agreement.

               1.9   "FDA" means the United States Food and Drug Administration
                      ---
or any other successor agency whose approval is necessary to market the Product
in the United States and any comparable agency in other countries in the
Territory where ABI intends to obtain regulatory approval.

               1.10  "GAAP" means generally accepted accounting principles as in
                      ----
effect in the United States applied on a basis consistent with past practice.

               1.11  "Gross Profits (or Losses)" means Net Sales less: (A)
                      -------------     ------
Chargeable Price; (B) any fees, costs and expenses incurred by APP in connection
with obtaining and maintaining Regulatory Approval for the Product including,
without limitation, those paid pursuant to Section 13.2; and (C) user fees. Any
                                           ------------
moneys paid to ABI under Sections 8, 9, 10 and 11 of this Agreement will not be
                         -------- -  -  --     --
included in the calculation of Gross Profits (or Losses).

               1.12  "Gross Sales Net of Chargebacks" means gross invoiced sales
                      ------------------------------
of the Product by APP to its customers (or in the case of sales to an Affiliate
of APP, the first sale to a non-affiliated customer) less chargebacks.

               1.13  "IPO" means the closing of the first sale by APP of shares
                      ---
of its common stock, par value $0.001 per share, for an aggregate offering price
of a minimum of $50 million in an underwritten public offering registered under
the Securities Act of 1933, as amended.

               1.14  "Legal Requirement" means any statute, law, ordinance,
                      -----------------
rule, regulation, permit, order, writ, judgment, injunction, decree or award
issued, enacted or made by any governmental entity or any arbitrator.

               1.15  "Manufacturing Agreement" means that certain manufacturing
                      -----------------------
agreement entered into between ABI and APP dated the same date as this
Agreement.

               1.16  "Manufacturing Recall" means a Recall arising from or
                      --------------------
relating to the Product that, when manufactured by APP, was adulterated,
contaminated or was otherwise caused by APP's failure to comply with the
Manufacturing Agreement or the Specifications as defined in the Manufacturing
Agreement.

<PAGE>

          1.17  "NDA" means one or more of the New Drug Applications that ABI
                 ---
files for the Product with the FDA, including any supplements or amendments and
510(k)s, and any foreign equivalents in Canada or Mexico.

          1.18  "Net Sales" means Gross Sales Net of Chargebacks less, with
                 ---------
respect to sales of Product: (A) freight and insurance charges actually paid;
(B) discounts, credits or allowances, if any, given or made because of price
adjustments; (C) actual replacements, returns or rebates (including but not
limited to group purchasing organization fees and rebates and governmental
rebates); (D) reasonable selling and marketing expenses (including pre-launch
expenses and sales force costs); (E) sales, excise and value added taxes if paid
by APP and (F) general and administrative costs incurred with respect to the
Product during a calendar year [***] The amount of the Net Sales for any period
will be determined in accordance with GAAP on the basis of sales recorded in the
ordinary course on the books of the relevant APP Parties during such period,
less the deductions provided for in this Section 1.18.
                                         ------------

          1.19  "Parties" means APP and ABI ("Party" meaning one of the
                 -------
Parties).

          1.20  "Person" means any natural person, corporation, trust,
                 ------
association, company, partnership, joint venture, governmental entity or other
entity.

          1.21  "Product" means ABI-007, a cremaphor-free, nanoparticle
                 -------
paclitaxel formulation[***]

          1.22  "Product Liability Claim" means any Action by a third party and
                 -----------------------
any appeal from any Action asserted by a third party with respect to the Product
alleging product liability, product defect, design, manufacturing, packaging or
labeling defect, failure to warn, or any similar action relating to the
formulation, manufacture, use or safety of the Product.

          1.23  "Proprietary Information" means all information relating to the
                 -----------------------
Product, the properties, composition or structure of the Product or the
manufacture or processing of the Product or the machines used to manufacture or
process the Product or to a Party's business (including, without limitation,
reagents, computer programs, algorithms, names and expertise of employees and
consultants, know-how, formulas, processes, ideas, inventions, whether
patentable or not, schematics and other technical, business, financial, customer
and Product development plans, forecasts, strategies and information), whether
previously, currently or subsequently disclosed to the other Party. ABI's
Proprietary Information shall include ABI Owned Developments and ABI
Developments. APP's Proprietary Information shall include APP Owned
Developments.

          1.24  "Proprietary Rights" means any and all patent rights,
                 ------------------
copyrights, mask rights, trade secret rights and all other intellectual and
industrial property rights.

          1.25  "Regulatory Approval" means the procurement of any registration,
                 -------------------
permit and approval required by applicable government authorities for the
manufacture, importation, marketing, sale or distribution of the Product.

          1.26  "Standard Costs" means direct and indirect costs, including
                 --------------
without limitation the materials, components, raw materials, direct labor and
overhead, attributable to

<PAGE>

production, manufacturing, processing, quality control and packaging by APP of
the Product, and shall be fixed year-to-year as set forth hereafter. Except for
the purposes of determining Actual Costs in accordance with Section 10.6(B),
                                                            ---------------
Standard Costs will not include costs incurred in connection with Bad Batches
(as hereafter defined) of the Product. In addition, Standard Costs will not
include general and administrative costs. The Standard Costs will be updated at
the end of each calendar year for the purpose of determining Chargeable Price
for the succeeding year. Except as otherwise contemplated by this definition or
agreed by the Parties, Standard Costs will be determined in accordance with GAAP
and standard costing principles as currently practiced by APP.

               1.27  "Technology" means any and all ideas, techniques,
                      ----------
inventions, methods, data, information, formulae, processes, trade secrets,
intellectual property, know-how, and test results, whether patentable or not,
and whether or not reduced to practice, including Proprietary Rights, owned,
controlled or otherwise in possession of or used by ABI as of the date of this
Agreement, or during the term of this Agreement and necessary or useful to make,
have made, develop, have developed, use, import, market, offer for sale or sell
the Product.

               1.28  "Territory" means North America.
                      ---------

     2.  License Grant.
         --------------

     Subject to the terms and conditions set forth in this Agreement:

               2.1  ABI grants to APP a license to and under the Technology to
use, market, distribute, import, export, sell and offer to sell the Product in
the Territory subject to Section 9. Any modification or improvement made by or
                         ---------
for ABI to the Technology during the term of this Agreement must be promptly
disclosed to APP and included in this license without additional charge to APP,
except as provided in Section 9. Subject to any modification under Section 9,
                      ---------                                    ---------
APP's license is exclusive solely within the Territory, even as against ABI. APP
will have the right to grant sublicenses to third parties as provided in Section
                                                                         -------
2.2.
----

               2.2  APP's right to sublicense will be in accordance with the
terms of the license granted to APP under this Agreement. Any sublicense and the
relevant sublicense agreement will be subject to ABI's review and prior written
approval, which approval shall not be unreasonably withheld or delayed. Despite
the foregoing, in no event will ABI be obligated to consent to the sublicensing
of this Agreement to a Competitor. Even if APP sublicenses the license granted
under this Agreement, APP will remain responsible to ABI for the performance of
its obligations under this Agreement and for any breach of the obligations under
this Agreement whether or not the breach is caused by APP or any sublicensee.

               2.3  APP may purchase the Product only from manufacturer(s)
designated in writing by ABI, which manufacturer(s) shall initially be APP under
the Manufacturing Agreement. ABI hereby designates APP as a manufacturer from
which APP may purchase the Product, for as long as the Manufacturing Agreement
is in effect.

               2.4  If ABI terminates APP's right to manufacture Product under
the Manufacturing Agreement for any reason other than under Section 12.2 or 12.4
of said Agreement, ABI shall arrange for adequate supply of Product to APP for
sale in the Territory for

<PAGE>

the duration of APP's license under this Agreement at a price not in excess of
the Chargeable Price applicable to APP manufactured Product in effect at the
time of such termination, as such price would be adjusted from time to time if
APP had been the manufacturer. If ABI terminates the Manufacturing Agreement
under Section 12.2 or 12.4 of said Agreement, but does not terminate this
      --------------------
Agreement, ABI shall use commercially reasonable best efforts to arrange for
adequate supply of Product to APP for sales in the Territory for the duration of
this License Agreement. In each case, ABI shall provide that the supplier of
Product to APP shall be responsible for the purity and conformance to
Specifications of the Product supplied to APP, and shall indemnify ABI and APP
to the same extent as APP indemnifies ABI under the Manufacturing Agreement.

          2.5  Except as otherwise agreed to by the Parties:

                    (A)  APP's license is limited to the Territory, and no APP
     Party may directly or indirectly market, distribute, sell or offer to sell
     the Product outside the Territory, nor may any APP Party directly or
     indirectly market, distribute, sell or offer to sell the Product to anyone
     that it has knowledge intends to, or reasonably believes intends to,
     directly or indirectly market, distribute, sell or offer to sell the
     Product to anyone outside the Territory.

                    (B)  Except as provided in Section 9, (i) no ABI Parties may
     directly or indirectly market, distribute, sell or offer to sell the
     Product inside the Territory, nor (ii) may ABI or its Affiliates sell the
     Product to anyone that it has knowledge intends to, or reasonably believes
     intends to, directly or indirectly market, distribute, sell or offer to
     sell the Product to anyone inside the Territory.

          2.6  So long as APP has made all milestone payments required under
Section 9, the license to APP shall convey the exclusive right to market and
---------
sell the Product in the Territory. If APP fails to make a milestone payment
required by Section 9, then the license to APP shall be limited to those
            ---------
oncology indications for which milestone payments have been made under Section
                                                                       -------
9, and ABI may, in its discretion, market or license the Product in the
-
Territory, for those indications for which APP did not make milestone payments.
Neither Party will be responsible to the other Party for the distribution or
sale of the Product other than by itself or its Affiliates for indications other
than those as to which it holds express rights under this Agreement, at the time
of the distribution or sale.

          2.7  Except as expressly provided in Section 14, nothing in this
                                               ----------
Section 2 or otherwise in this Agreement will confer any right to use in
---------
advertising, publicity or other promotional activities any name, trademark or
trade name of ABI.

     3.  Transfer of Technology; Improvements.  ABI will convey and disclose in
         ------------------------------------
tangible form to APP, as soon as reasonably practicable after the Effective Date
and throughout the term of this Agreement, all Technology. Each Party agrees to
as soon as reasonably practicable disclose in tangible form to the other Party
all modifications and improvements made to the Technology during the term of
this Agreement. APP will immediately transfer to ABI all right, title and
interest in and to any process, product, composition, or product-by-process, or
any improvements thereto, including inventions ("Developments"), made by the APP
Parties using

<PAGE>

ABI's processes or outputs ("Processes") (collectively, the "ABI Owned
Developments"). From and after their development, the ABI Owned Developments
will be included within the scope of the license granted to APP under this
Agreement. APP will own any Developments made by APP or its assignees using any
process or output other than the Processes, provided such Developments are
developed solely by APP or its assignees without any input from ABI or any of
its employees, including Patrick Soon-Shiong. Any Developments that are
developed solely by APP without using any Processes are referred to as the "APP
Owned Developments." APP may take whatever steps it deems necessary to protect
its rights in the APP Owned Developments. APP further grants to ABI, subject to
Section 17.2, a perpetual, royalty-free license to use all of the APP Owned
------------
Developments that are used or needed by APP in the manufacture or
commercialization of the Product.

     4.  Marketing.  Subject to Section 9, APP will use reasonable commercial
         ---------
efforts to market, distribute and sell the Product under the license granted
under this Agreement. Those efforts will include marketing, distributing and
selling the Product on its own merits and not in a manner instead intended to
promote other Products. Any advertising of the Product by the APP Parties must
be free from unwarranted statements and all advertising and promotional
materials will be subject to the review and comment of ABI. APP will continue to
promote the sale of the Product in the Territory during the term of this
Agreement, and will maintain the types of facilities, places of business,
approvals, employees (or third party representatives) that are necessary to do
so.

     5.  Representation and Warranties of the Parties.  Each Party represents to
         --------------------------------------------
the other Party that as of the date of this Agreement:

               5.1  The Party (A) is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation and (B) has full power and authority to execute and deliver this
Agreement and to perform its obligations under this Agreement;

               5.2  This Agreement constitutes the valid and legally binding
obligation of the Party and is enforceable against the Party in accordance with
its terms;

               5.3  Except as limited in Section 6, the execution and delivery
                                          --------
of this Agreement and the performance of its obligations under this Agreement by
the Party will not cause the Party to violate or contravene (A) the Party's
articles of incorporation or bylaws, (B) any instrument, agreement or
understanding by which the Party or any of its Affiliates is bound or affected,
or (C) any Legal Requirement by which the Party or its properties or assets is
bound or affected; and

               5.4  The Party is not required to obtain a consent, approval or
license from any Person to execute, deliver and perform this Agreement (except
for Regulatory Approvals contemplated under this Agreement), and except for the
consent approvals or licenses that have been duly obtained by the Party.

     6.  Representation and Warranties of ABI.  ABI represents and warrants to
         ------------------------------------
APP that as of the date of this Agreement:

<PAGE>

               6.1  ABI owns and has the unrestricted and enforceable right to
use, develop and commercialize the Technology and the Product in the Territory,
and may enter into this Agreement. To ABI's knowledge, all prior art was
disclosed in the course of the prosecution of the patents included in the
Technology that ABI was aware would cause such patents to be invalid or
unenforceable. Subject to the immediately preceding sentence, ABI makes no
representation as to the validity or enforceability of any patent relating to
the Product.

               6.2  ABI has not previously assigned, licensed, sublicensed,
encumbered or otherwise transferred to any third party any of the Technology or
the Product in the Territory;

               6.3  To ABI's knowledge, there are no Actions that are pending
or, to the knowledge of ABI, threatened, that challenge the rights of ABI or its
licensees to develop, use or commercialize the Technology or the Product;

               6.4  To ABI's knowledge, ABI has provided APP with all material
information with respect to its clinical trials for the Product;

               6.5  To ABI's knowledge, ABI has not used in any capacity the
services of any person debarred under Section 3.6 of the Federal Food, Drug and
                                      -----------
Cosmetic Act in connection with the NDA filed for Product;

               6.6  No royalties are due to third parties by APP for sales of
the Product;

               6.7  ABI has taken, and will continue to take, reasonable
security measures to protect the secrecy, confidentiality and value of the
Technology; and

               6.8  To ABI's knowledge, ABI's activities to date relating to the
Technology and the Product have not been, and the planned and proposed
development, use and commercialization of the Technology and the Product will
not be in violation or contravention of the patent, intellectual property, trade
secret or other rights of any third party. Neither ABI, its Affiliates or
employees nor, to ABI's knowledge, ABI's agents, advisors or consultants, has
received any written or oral communication (A) alleging that it has violated, or
by use, development or commercialization of the Technology or Product would
violate, the patent, intellectual property, trade secret or other rights of any
third party or (B) that otherwise challenges ABI's rights with respect to the
Technology or the Product.

               6.9  EXCEPT AS EXPRESSLY PROVIDED IN SECTIONS 6.1 - 6.8, ABI (A)
                                                    ------------------
SPECIFICALLY DISCLAIMS ALL WARRANTIES OF ANY KIND REGARDING THE PRODUCT OR THE
TECHNOLOGY, INCLUDING ANY WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE, (B) MAKES NO REPRESENTATION REGARDING THE SUITABILITY OF THE
PRODUCT OR ANY OF THE TECHNOLOGY FOR ANY THIRD PARTY'S REQUIREMENTS, AND (C)
MAKES NO REPRESENTATION AS TO WHETHER OR NOT THE TECHNOLOGY INFRINGES ON THE
PATENT OR OTHER PROPRIETARY RIGHTS OF ANY THIRD PARTY.

<PAGE>

     7.  APP Representations and Warranties.
         ----------------------------------

               7.1  APP represents and warrants to ABI that, as of the date of
this Agreement, none of the executive officers of APP has any knowledge that any
of ABI's representations and warranties are inaccurate. For purposes of this
Section 7.1, the knowledge of Patrick Soon-Shiong shall be imputed to ABI rather
-----------
than to APP.

               7.2  APP acknowledges and agrees that none of APP or its
Affiliates has or claims to have ownership or license rights to the Technology
or Product except as set forth in this Agreement. APP agrees that neither ABI
nor any third party has promised, offered or conveyed to APP any interest in the
Technology or Product except as set forth in this Agreement and the
Manufacturing Agreement.

     8.  Up-Front Payment; IPO.
         ---------------------

               8.1  APP shall pay to ABI:

                         (A)  $15 million on a date designated by ABI to APP on
     at least two (2) days written notice, which payment date shall not be
     earlier than 30 days nor later than 45 days following the execution of this
     Agreement;

                         (B)  $10 million upon the earlier of (1) January 15,
     2002 or (2) 30 days following APP's IPO; and

                         (C)  $35 million upon the earlier of (1) January 15,
     2003 or (2) 30 days following APP's IPO.

               8.2  Despite the provisions of the relevant instruments, ABI is
required to repay APP any amounts owing under the Demand Promissory Note dated
July 24, 2001 and as amended and restated in October, 2001, and the Letter
Agreement dated October 21, 1999, no later than the earlier of (A) the five year
anniversary of the execution of this Agreement, and (B) the payment of $75
million by APP to ABI under Section 10. Notwithstanding the foregoing, APP shall
be allowed to take as a credit against the payments of Section 8.1(C) in excess
of $25 million, any amounts above $22 million advanced to ABI by APP. Promptly
after the execution of this Agreement, ABI and APP will enter into an agreement
to secure ABI's obligation under this Section 8.2.

     9.  Milestone Payments.
         ------------------

               9.1  In addition to the payments provided for in Section 8,
                                                                ---------
Section 10 and Section 11, upon notice to APP from ABI of the achievement of the
----------     ----------
following milestones, and within 30 days of that notice (subject to the
provisions of Sections 9.4 and 9.5), APP is required to make the following
              --------------------
respective one-time payments:

                         [***]

               9.2  With respect to [***], the respective payment will be
reduced to $5 million.

<PAGE>

               9.3  No milestone payment with respect to lung, ovarian or
prostrate cancers, or other cancer indications will be due and payable prior to
Regulatory Approval of the NDA for a breast cancer indication.

               9.4  In the event one or more of the milestone payments under
Section 9.1 (A) - (H) are due before APP has an IPO, and ABI at that time owns
---------------------                                ---
or controls at least fifty percent (50%) of APP's capital stock, APP shall be
allowed to pay such milestone payment(s) [***] Any marketing or distribution of
Product for such indication by APP after such failure to make a milestone
payment will be a breach of this Agreement by APP. From and after APP's failure
to make such milestone payment, ABI will have the right to use the Technology
for the relevant indication in any manner it deems appropriate, including use
within the Territory.

               9.5  APP may decline to make the milestone payments set forth in
subsections (I), (J), (K) and (L) of Section 9.1 if, and only if, at the time
---------------------------------    -----------
that the milestone is met and notice is provided by ABI to APP, Net Sales of the
Product by APP do not, in the aggregate, equal or exceed [***] (the "Milestone
                                                                     ---------
Minimum").
-------
                       (A)  If, upon 30 days notice from ABI that it has
     achieved a milestone set forth in subsections (I), (J), (K) or (L) of
     Section 9.1, APP has achieved the Milestone Minimum, then APP is required
     to pay to ABI the milestone payment provided for in the relevant
     subsection.

                       (B)  If, upon 30 days notice from ABI that it has
     achieved a milestone set forth in subsections (I), (J), (K) or (L) of
     Section 9.1, APP has not achieved the Milestone Minimum, then upon notice
     from ABI, APP is required to pay to ABI the milestone payment provided for
     in subsections (I), (J), (K) or (L) of Section 9.1 or indicate in writing
     that it is declining to make the payment. APP's failure to make a certain
     milestone payment in subsections (I), (J), (K) or (L) of Section 9.1, or to
     indicate that it is declining to make such a payment if the Milestone
     Minimum has not been achieved, will be deemed a declination by APP to make
     such milestone payment.

                       (C)  Following APP's declination or deemed declination to
     make a milestone payment, upon each declination or deemed declination, the
     relevant indication for which the milestone set forth in subsections (I),
     (J), (K) or (L) was achieved will no longer be included within the license
     grant to APP and APP will have no further right to use, market, distribute,
     import, export, sell and offer to sell the Product for such indication. Any
     marketing or distribution of Product for such indication by APP after its
     declination or deemed declination to make the milestone payment will be a
     breach of this Agreement by APP. From and after the declination or deemed
     declination by APP, ABI will have the right to use the Technology for the
     relevant indication in any manner it deems appropriate.

               9.6  Once a milestone payment has been made under this Section 9
for a particular indication (e.g., breast cancer), no additional payment shall
be due for label expansion or improvements within such indication.

<PAGE>

     10.  Share of Gross Profit or Loss.
          -----------------------------

               10.1  APP will pay to ABI:

                     (A)  Except as set forth in Sections 9.4 and 9.5 and
     Section 10.1(B), [50% of the Gross Profits on sales of the Product in the
     Territory by the APP Parties. For purposes hereof, Gross Profits on sales
     of the Product by APP's permitted sublicensees in the United States is the
     greater of actual Gross Profits of the sublicensees or the Gross Profits
     that APP would have earned based upon its recent prior results if it had
     sold the Product itself in the United States rather than through a
     permitted licensee.

                     (B)  50% of the consideration received by APP from any
     sublicensees in Canada and Mexico, in consideration for the grant of
     sublicenses of Technology, as permitted in Section 2.2 herein. As used in
     this Section 10.1(B), consideration shall include amounts received from
     such sublicenses for the sale of Product to them by APP or its Affiliates,
     less the Actual Cost of such Product (as defined in Section 10.6).

               10.2  Except as provided in Section 16, APP's obligation to pay a
                                           ----------
percentage of the Gross Profits or consideration received by the APP Parties
will cease on a country-by-country basis within the Territory, after expiration,
in each respective country, of the last to expire of all patents listed on
Exhibit A, as such Exhibit A may be amended from time to time by mutual
---------          ---------
agreement of the Parties. Despite the foregoing, such obligation shall not cease
in the event the APP Parties sell the Product in such a country using the ABI
Brand Names.

               10.3  APP must make the payments due under this Section 10 within
                                                               ----------
45 days following the end of, and with respect to sales of the Product by the
APP Parties during, each calendar quarter. If any payment due under Section 10
                                                                    ----------
is not made when due, interest will accrue at the rate of 8% per year on the
unpaid amount from the due date until the date of the payment.

               10.4  If there is a Gross Loss in any calendar quarter, no
payment is required for that quarter, and the amount of the Gross Loss will be
carried forward and reduce the amount of Gross Profits for the next calendar
quarter (and, as necessary, carried forward to successive quarters until the
full amount of Gross Loss has been offset by subsequent Gross Profit). Pre-
launch selling and marketing expenses of APP under this Agreement will be
treated as a deduction from Net Sales in the first calendar quarter of sales
under this Agreement.

               10.5  Within 45 days following the end of each calendar quarter
(and accompanying any payments made to ABI under this Section 10), APP must
                                                      ----------
supply ABI with a report, on behalf of the APP Parties, setting forth in
reasonable detail the calculation of ABI's share of Gross Profits (or Losses).
APP must keep and maintain, and must cause the APP Parties to keep and maintain,
detailed and accurate books and records with regard to Gross Profits (or
Losses), Net Sales, and the calculations for Gross Profits (or Losses) and Net
Sales. A nationally known independent certified public accounting firm selected
by ABI (which must be (A) other than APP's designated certified public
accounting firm, (B) reasonably acceptable to APP, and (C) bound in confidence
not disclose any information except to inform ABI of discrepancies) will be
entitled, for purposes of determining compliance with this Section 10, to review
                                                           ----------
and audit the books and records of the APP Parties from time to time, but no
more than three times a year

<PAGE>

as to each such party, during normal business hours upon reasonable notice to
the relevant APP Party and at ABI's expense. Provided however, if the review or
audit shows an underpayment of more than 10% for the applicable period, the
relevant APP Party will bear the expense. The findings of the accounting firm
will be binding on the Parties.

          10.6  At the end of each calendar year, the parties shall "true up"
the Gross Profits (or Losses) applicable to APP manufactured Product sold by the
APP Parties in the Territory as follows:

                (A)  Within 45 days after the end of each calendar year, APP
     shall determine its Actual Costs of manufacturing Product during such
     calendar year. The Actual Costs shall be APP's actual direct and indirect
     costs of manufacturing Product, including without limitation the materials,
     components, facility maintenance and depreciation, utilities, and labor and
     overhead, attributable to Production, processing, packaging and quality
     control of Product manufactured by APP and sold by it during such calendar
     year. The Actual Costs shall include an allowance for the costs of Bad
     Batches, as set forth in Section 10.6(B). On the basis of such Actual
                              ----------------
     Costs, APP shall calculate its revised Chargeable Price for such calendar
     year, which shall be determined by substituting Actual Costs for Standard
     Costs in the formula set forth in Section 1.5 (the "Revised Chargeable
     Price"). If the aggregate Revised Chargeable Price is less than the
     aggregate Chargeable Price originally included in the determination of
     Gross Profits (or Losses) for all Product sold during such calendar year,
     then APP shall remit to ABI one-half of such difference. If the aggregate
     Revised Chargeable Price is greater than the aggregate Chargeable Price
     originally included in the determination of Gross Profits (or Losses) for
     all Product sold during such calendar year, then ABI shall remit to APP
     one-half of such difference. APP shall include such calculations in its
     accounting report which is due 45 days after the end of each calendar year.

                (B)  For purposes of determining Actual Costs, APP shall be
     permitted to include the costs of actual Bad Batches manufactured by APP
     [***]

                (C)  In addition to, and separate and apart in all respects from
     the provisions of Section 10.6(B), the costs of Bad Batches in the first
                       ---------------
     seventeen batches manufactured after the Effective Date (excluding pilot or
     pilot scale batches), shall be borne equally by the Parties. ABI shall
     reimburse APP for 50% of such costs, and APP's share of such costs shall be
     omitted from all calculations of Standard Costs and Actual Costs.

               (D)  As used in this Section 10.6, "Bad Batches" shall mean
                                    ------------
     batches of Product which are lost in the course of manufacture, or are
     determined by APP not to be suitable for release. Notwithstanding the
     foregoing, Bad Batches shall not include pilot or pilot scale batches.

     11.  Sales Achievement Milestone Payments.  APP is required to make the
          ------------------------------------
highest of the following milestone payments that have been achieved but not yet
paid to ABI within 30 days following the end of the calendar year in which the
indicated level of annual Adjusted Net Sales of the Product has been attained or
exceeded by the APP Parties:

<PAGE>

     Annual Adjusted Net Sales       Milestone Payment
     -------------------------       -----------------

     [***]                           $10 million
     [***]                           $20 million
     [***]                           $30 million
     [***]                           $50 million

     For the sake of clarity, each such milestone payment shall be made one time
only, if at all, during the course of this Agreement.  If an indicated level of
Adjusted Net Sales is attained in a calendar year but the corresponding
milestone payment has previously been paid, APP shall pay the next lowest level
of unpaid milestone payments, if any.  For purposes of this Section 11,
                                                            ----------
"Adjusted Net Sales" means Net Sales as defined in Section 1.18 but without the
                                                   ------------
deduction contained in Section 1.18(D).
                       ---------------

     12.  Further Development of the Product.
          ----------------------------------

               12.1  ABI will diligently pursue development of the Product for
the indications of breast, lung, ovarian and prostate cancers, according to the
objectives established by the Steering Committee. The Steering Committee will
reasonably determine the claims desired, the design, conduct and desired
endpoints of clinical trials, regulatory submissions to be made, timelines,
indications (other than those referred to above) to be studied and petitioned,
and other objectives of development and of lifecycle management efforts (e.g.,
Phase IIIb/IV) (the "Development Issues").
                     ------------------

               12.2  All developments will be performed at ABI's sole cost and
expense, but APP must provide to ABI, as requested by ABI (A) up to $2 million
of the Product (based on Chargeable Price) free of charge, [***]

               12.3  The steering team will be comprised of three
representatives from each of ABI and APP (the "Steering Committee"), and is
                                               ------------------
required to meet in person or by conference call at least once every three
months, or more often as needed. Each Party's representatives must reasonably
cooperate in establishing meeting dates, setting agendas, attending and
conducting the meetings, and working diligently toward, and contributing to, the
goals and business of the Steering Committee and the Development Issues.

               12.4  If consensus cannot be reached on one or more Development
Issues, APP's representatives will be entitled to make the final decision with
respect to breast, lung and ovarian indications and ABI's representatives will
be entitled to make the final decision for all other indications.

     13.  Regulatory Filings/Approvals.
          ----------------------------
               13.1  ABI will be responsible for and required to:

                     (A)  make all filings, and other submissions, to the
     applicable governmental agency, department or other body regarding or
     relating to the Product; and

<PAGE>

                     (B)  obtain all Regulatory Approvals to develop, test,
     market, and distribute the Product in the Territory in the manner and for
     the indications indicated in this Agreement and determined by the Steering
     Committee, except for filings and other submissions required to be made by
     APP for the manufacture of the Product as set forth in the Manufacturing
     Agreement.

               13.2  APP will reasonably cooperate with ABI in its efforts under
Section 13.1. All costs and expenses associated with the foregoing with respect
------------
to a particular indication will be borne by ABI until ABI obtains FDA approval
of the NDA for such indication. Thereafter, for each indication for which APP
makes the milestone payment under Section 9, although ABI will continue to be
                                  ---------
responsible for regulatory filings and the maintenance of such approvals, APP
will promptly reimburse ABI for any further direct costs incurred with respect
to the maintenance of such regulatory approvals for each such indication in the
Territory upon presentation of documentary evidence of these types of payments.

               13.3  ABI will use all commercially reasonable efforts to
diligently and aggressively pursue the development of the Product for breast,
lung and ovarian indications.

     14.  Use of Brand Names.
          ------------------

               14.1  During the term of this Agreement, and as permitted under
Section 16.2, and except for those indications for which APP does not make
------------
payments under Section 9, APP will have the right to market, distribute, import,
               ---------
export, offer to sell and sell the Product in the Territory using any brand name
included in an NDA that is approved by the FDA or otherwise established by ABI
for the Product ("ABI Brand Names") and no other party will have such right in
                  ---------------
the Territory. APP shall have such right to the full extent that ABI has the
right to use ABI Brand Names. Any use by APP of ABI Brand Names will be subject
to ABI's comments and may not impair or dilute the value of the names. Except as
provided under Section 16 APP may not sell the Product using any other brand
               ----------
names.

               14.2  As between ABI and APP, ABI will be the sole owner of all
ABI Brand Names and hereby grants APP a royalty-free trademark license for the
use of ABI Brand Names, subject to the other payment provisions in this
Agreement.

               14.3  In connection with its use of ABI Brand Names, APP must:

                     (A)  credit ABI for ownership of the ABI Brand Names in any
     marketing efforts in which it uses any ABI Brand Names;

                     (B)  at its expense, take whatever action may be required
     under any Legal Requirement to use any ABI Brand Names in the Territory or
     refrain from taking any action that could impair or dilute the value of any
     ABI Brand Names; and

                     (C)  reasonably cooperate with ABI in connection with any
     Action relating to the use by ABI (or its licensees, including APP) of any
     ABI Brand Names that APP is using.

<PAGE>

     15.  No Restriction on Competition. Nothing in this Agreement will be
          -----------------------------
deemed to prohibit either Party from developing, making, using, marketing or
otherwise distributing or promoting Products competitive with the Product.

     16.  Term.
          ----

               16.1  This Agreement will commence on the Effective Date and,
except as provided in this Section 16 and Section 17 will continue until the
                           ----------     ----------
date of expiration of the last patent containing a valid claim that would be
infringed by the use, marketing, sale or distribution of the Product, including
in finished form, but upon the expiration, APP will have a fully-paid, royalty-
free (except as provided in Section 16.4) irrevocable, non-exclusive right to
                            -------------
use, market, sell and distribute the Product in the Territory except for those
indications for which APP does not make payments under Section 9.
                                                       ---------

               16.2  If APP desires to continue to sell Product using ABI Brand
Names after the expiration of such last patent, it may, except for those
indications for which APP does not make payments under Section 9, do so by
                                                       ---------
providing ABI with six months notice prior to such expiration of APP's desire to
extend the license to ABI Brand Names, as provided in Section 14.1. Except as
                                                      ------------
provided in Section 16.3, this Agreement will continue for successive one-year
            ------------
terms thereafter (the "Extension Periods") until APP provides ABI with a minimum
                       -----------------
of six months notice of APP's intention to terminate.

               16.3  If, during the Extension Periods, the APP Parties are
selling the Product under any ABI Brand Name while concurrently selling Product
in a generic form, [***]

               16.4  So long as the APP Parties continue to sell Product under
an ABI Brand Name, APP must pay to ABI the percentage of Gross Profits or
consideration that APP would be obligated to pay to ABI under Section 10 but
                                                              ----------
only for sales of the Product sold using ABI Brand Names. During an Extension
Period, the APP Parties shall have no payment or royalty obligations to ABI for
sales by APP Parties of Product sold under any name other than an ABI Brand
Name.

     17.  Termination.
          -----------

               17.1  This Agreement may be terminated:

                     (A)  At any time by mutual agreement of the Parties;

                     (B)  Immediately, by the non-defaulting Party, if the other
      Party:

                              (1)  commits a material breach or default
               ("Breach") under this Agreement, which Breach is not remedied
               within 60 days after the receipt of written notice of the Breach
               by the Party in Breach (except as to the payment of money by APP,
               for which the notice period will be 10 days). Notwithstanding the
               foregoing, if the Breach is not curable in 60 days and the
               breaching or defaulting party in good faith notifies the other
               party in writing prior to the 60 days that it is initiating cure
               of the

<PAGE>

               Breach, and initiates cure of such Breach within 60 days after
               the initial notice and in good faith continues diligently to
               attempt to cure the Breach, then this Agreement shall not be
               terminated pursuant to this Section 17.1(B)(1). Provided,
                                           ------------------
               however, it shall not be a breach of the Agreement if APP does
               not make one or more of the milestone payments under Section 9.1
                                                                    -----------
               (A) - (H), but rather, in such instance and subject to Section
               ---------                                              -------
               9.4, APP shall immediately lose all right to use, market,
               ---
               distribute, import, export, sell and offer to sell the Product
               for such indication and that indication for which the payment was
               not made shall not longer be included within the license grant to
               APP. From and after APP's failure to make a milestone payment,
               ABI will have the right to use the Technology for the relevant
               indication in any manner it deems appropriate, including use
               within the Territory.

                         (2)  made a material misrepresentation of any
               representation or warranty contained in this Agreement; or

                         (3)  has a permanent or temporary restraining order,
               preliminary injunction or other order granted against it by a
               court or authority enjoining or restricting the sale of the
               Product as contemplated hereby in the Territory. Notwithstanding
               the foregoing, if any such order results or would foreseeably
               result in a decline of 10% or less of units of Product sold in
               the Territory as compared to the prior calendar year's sales of
               units of Product sold in the Territory, then this Agreement shall
               not be terminated pursuant to this Section 17.1(B)(3).
                                                  ------------------

                    (C)  Following a 60-day period after written notice to cure
          such condition, by either ABI or APP if the other Party:

                              (1)  does not pay its debts generally as they
               become due, or is unable to pay its debts generally as they
               become due;

                              (2)  has or has instituted against it any
               proceeding seeking to adjudicate it bankrupt or insolvent, or
               seeking liquidation, winding up, reorganization, arrangement,
               adjustment, protection, relief or composition of it or its debts
               under any law relating to bankruptcy, insolvency or
               reorganization or relief of debtors;

                              (3)  makes a general assignment for the benefit of
               creditors;

                              (4)  seeks the entry of an order for relief or the
               appointment of a receiver, liquidator, sequestrator, trustee,
               custodian or similar official for it; or

                              (5)  takes advantage of any other law or procedure
               for the protection of creditors.

               17.2  Upon the termination of this Agreement by ABI pursuant to
Section 17.1, the rights and license granted to APP under this Agreement and
------------
APP's obligations under Sections 8, 9, 10 and 11 (except to the extent earned
but not yet paid) will terminate, sublicenses will terminate, and ABI's
obligations to provide Technology or information will cease. The rights and
license to APP under this Agreement, and the sublicenses granted thereunder,
shall

<PAGE>

survive termination of this Agreement by ABI for any other reason. Except to the
extent that any monies are owned and not yet paid and for the provisions of
Sections 5, 6, 7, 17, 18, 19, 20, 21, 22, 23, 25, 26, 32, and 33, none of the
-------- -- -- -- --  --  --  --  --  --  --  --  --  --      --
provisions of this Agreement shall survive termination. Upon the termination by
APP under Sections 17.1(B) or (C), ABI's license to APP Owned Developments shall
          -----------------------
also terminate. Upon ABI's termination of this Agreement pursuant to Section
                                                                     -------
17.1, ABI will have the right to concurrently terminate the Manufacturing
----
Agreement.

               17.3  Termination is not the sole remedy under this Agreement,
and whether or not termination is effected, all other remedies remain available
to each Party.

     18.  Confidentiality.
          ---------------

               18.1  Each Party recognizes that the other Party holds its
Proprietary Information as important. In particular, each Party recognizes that
the other Party's Proprietary Information (and the confidential nature thereof)
is critical to the other Party's business and that neither Party would enter
into this Agreement without assurance that such information and the value
thereof will be protected as provided in this Section 18 and elsewhere in this
                                              ----------
Agreement.

               18.2  Each Party must, therefore:

                     (A)  Hold the other Party's Proprietary Information in
      confidence and take reasonable precautions to protect the Proprietary
      Information (including, without limitation, no less than all precautions
      that it employs with respect to its own confidential materials);

                     (B)  not divulge (except pursuant to a sublicense expressly
      authorized in this Agreement) the other Party's Proprietary Information or
      any information derived therefrom to any third person; and

                     (C)  not make any use whatsoever at any time of the other
      Party's Proprietary Information except for purposes of and expressly
      authorized in this Agreement.

               18.3  Any employee given access to any Proprietary Information
must have a legitimate "need to know" and must be bound in writing to maintain
the confidence of information to which it is given access.

               18.4  Without granting any right or license, the disclosing Party
agrees that the foregoing restrictions will not apply with respect to
information that the receiving Party is able to demonstrate by competent
evidence:

                     (A)  is in or (through no improper action or inaction by
      the receiving Party or any Affiliate of the receiving Party or its agents
      or employees) enters the public domain (and is readily available without
      substantial effort);

                     (B)  was rightfully disclosed to it by another person
      without restriction; or

<PAGE>

                (C)  was independently developed by it by persons without access
     to such information and without use of any of the disclosing Party's
     Proprietary Information.

          18.5  Each Party's obligations under this Section 18 will terminate
                                                    ----------
five years after the date of termination or expiration of this Agreement. The
Parties recognize and acknowledge that prior to the Effective Date of this
Agreement, each Party has received the other Party's Proprietary Information and
each hereby agrees to protect the Proprietary Information to the same extent as
set forth in this Section 18.
                  ----------

          18.6  Immediately upon termination or expiration of this Agreement,
each Party will turn over to the other Party all Proprietary Information of the
other Party and all documents or media containing any Proprietary Information
and any and all copies or extracts thereof except insofar as necessary to
practice the license as set forth in Section 16.1.
                                     ------------

          18.7  Each Party acknowledges and agrees that due to the unique nature
of Proprietary Information, there can be no adequate remedy at law for any
breach of each Party's obligations under this Section 18, that any breach may
                                              ----------
result in irreparable harm to the disclosing Party, and therefore, that upon any
breach or any threat of breach, the disclosing Party will be entitled to
appropriate equitable relief (without the posting of any bond) in addition to
whatever remedies it might have at law in connection with any breach or
enforcement of the receiving Party's obligations under this Agreement or the
unauthorized use or release of any Proprietary Information.

     19. Patent Matters.
         --------------

          19.1  ABI will, in a scientifically and commercially reasonable
manner, file and prosecute patent applications and maintain patents in the
Territory relating to the Technology, the ABI Owned Developments and any
improvements made by or on behalf of ABI ("ABI Developments").
                                           ----------------

          19.2  APP will not attempt to file or prosecute any patent
applications or maintain any patent covering the Technology, the ABI
Developments, or the ABI Owned Developments except: (i) as ABI may, in its sole
discretion, approve in writing; (ii) in the event ABI elects to discontinue or
abandon the prosecution and/or maintenance of any patent or patent application
covering the Technology in the Territory, it shall provide adequate notice to
APP and shall give APP the opportunity to file, continue prosecution of, pay any
issuance fee and/or maintain such patent application and/or patent at APP's own
expense.

          19.3  APP may take whatever steps it deems necessary to protect and
enforce its rights and interest in APP Owned Developments. ABI will not attempt
to file or prosecute any patent applications or maintain any patent covering the
APP Owned Developments.

          19.4  If either Party becomes aware of any Product or activity of any
third party that involves or may involve infringement or other violation of any
patent relating to the Proprietary Information, APP Owned Developments (to the
extent related to the Product), ABI Owned Developments, ABI Developments or
other Proprietary Right in the Territory, that Party must promptly notify the
other Party in writing of the infringement or violation.

<PAGE>

          19.5  ABI will have the first right, but not the obligation, to file
suit or take other action to prevent the infringement of any patents or
Technology owned by ABI related to the Product in the Territory. If ABI takes
such action, ABI will control any action undertaken by ABI against an infringer,
and ABI may enter into settlements, stipulated judgments or other arrangements
respecting the infringement, at its own expense unless the proposed settlements,
judgments or arrangements would adversely affect APP, in which case, they will
be subject to APP's consent which will not be unreasonably withheld. If ABI
takes such action, ABI will defend, indemnify and hold APP harmless from related
costs and expenses for such claimed infringement. APP will permit an action to
be brought by ABI in APP's name if required by law. APP agrees to provide all
assistance that ABI may reasonably require in any litigation, including
providing written evidence, deposition and trial testimony, for which ABI will
pay APP a reasonable hourly rate of compensation, together with reimbursement
for out-of-pocket costs. Any damages or other recovery from an infringement
action undertaken by ABI pursuant to this Section 19.5 to enforce ABI's
                                          ------------
Proprietary Rights relating to the Product sold in the Territory, will be used
first to reimburse ABI's legal costs and expenses incurred in the action and
thereafter any damages or other recovery relating to Products sold by the APP
Parties in the Territory will be shared equally with APP.

          19.6  If ABI does not, within 90 days after receipt of notice of a
patent infringement relating to the use of the Product sold by the APP Parties
in the Territory, commence action directed toward restraining or enjoining such
patent infringement, APP may take such legally permissible action as it deems
necessary or appropriate to enforce ABI's patent rights and restrain such
infringement at its own expense unless the actions would adversely affect ABI,
in which case they will be subject to ABI's consent which will not be
unreasonably withheld. If APP takes such action, APP will indemnify, defend and
hold harmless ABI in respect of any such action. Any damages or other recovery
from an infringement action undertaken by APP pursuant to this Section 19.6 to
                                                               ------------
enforce ABI Proprietary Rights on the Product sold in the Territory, will be
first used to reimburse APP's legal costs and expenses incurred in such action
and thereafter shared equally with ABI; provided if any portion of such damages
or other recovery relate to infringement outside the Territory or Product not
sold by the APP Parties in the Territory, such portion shall be paid 100% to
ABI.

          19.7  Each Party must fully cooperate with the other Party bringing
any action, including joining as a Party to the suit, if necessary, and also
including, without limitation, supplying essential documentary evidence and
making essential witnesses then in its employ available.

          19.8  If any third party threatens or commences a lawsuit against
either Party alleging the Product in any way infringes or otherwise violates any
Proprietary Rights of such third party, it shall promptly notify the other Party
in writing.

     20. Adverse Experience Reporting; Recalls.
         -------------------------------------

          20.1  Each Party will report to the other Party any information of
which it becomes aware concerning any adverse drug experience in connection with
the use of the Product, including the incidence and the severity thereof. ABI
will provide to APP copies of any

<PAGE>

reports submitted to the FDA relating to any adverse drug experiences that ABI
determines to be significant.

            20.2  If ABI is required to initiate, or otherwise in its discretion
decides to initiate, a recall, withdrawal or field correction (collectively, a
"Recall") of the Product sold by the APP Parties in the Territory, ABI will
 ------
notify APP and provide a copy of its proposal with respect to such Recall,
including the Recall letter, for APP's review prior to ABI's initiation of the
Recall. If APP independently believes that a Recall of the Product sold by the
APP Parties in the Territory may be necessary or appropriate, it must notify
ABI, and the parties must fully cooperate with each other concerning the
necessity and nature of the Action.

            20.3  ABI will be responsible for all Recall activities with respect
to Recall of the Product. APP will reasonably cooperate with ABI in connection
with any Recall. Each Party will maintain complete and accurate Recall records
relating to the Product for any periods that are required by any Legal
Requirement.

            20.4  The fees, costs and expenses of any Recall (collectively, the
"Recall Expenses") of the Product will be apportioned between
 ---------------
the Parties as follows:

                   (A)  [***]
                   (B)  [***]
                   (C)  [***]
                   (D)  [***]

     21.  Indemnification; Incidental And Consequential Damages.
          -----------------------------------------------------

            21.1  APP agrees to indemnify, defend and hold harmless the ABI
Parties from any Damages incurred by or assessed against the ABI Parties
resulting from a third party claim caused or alleged to be caused by:

                 (A)  APP's failure to perform any of its obligations under this
     Agreement;

                 (B)  any breach of or inaccuracy in any representations or
     warranty made by APP in this Agreement;

                 (C)  any Product Liability Claim arising from the gross
     negligence, fraud or intentional misconduct of an APP Party;

                 (D)  a sublicesee's material breach of its sublicense under
     this Agreement or related to any gross negligence, fraud or intentional
     misconduct on the part of any sublicensee of APP; and

                 (E)  any Product Liability Claim directly resulting from the
     use of the Product that, when manufactured by APP, was adulterated or
     contaminated, or was

<PAGE>

     otherwise caused by APP's failure to comply with this Agreement or the
     Specifications provided for in the Manufacturing Agreement.

          21.2  ABI agrees to indemnify, defend and hold harmless the APP
Parties from any Damages incurred by or assessed against the APP Parties
resulting from a third party claim caused or alleged to be caused by:

                (A) ABI's failure to perform any of its obligations under this
     Agreement;

                (B) any breach of or inaccuracy in any representations or
     warranty made by ABI in this Agreement;

                (C) any Product Liability Claim arising from the gross
     negligence, fraud or intentional misconduct of ABI Parties;

                (D) any Product Liability Claim directly resulting from the use
     and/or sale of the Product outside the Territory, except for those covered
     in Section 21.1(C) or Section 21.1 (E);
        ---------------    ----------------

                (E) any Product Liability Claim directly resulting from the use
     and/or sale of the Product inside the Territory, when sold by ABI Parties
     for indications other than those licensed to APP, except for those covered
     in Section 21.1(C) or Section 21.1 (E).
        ---------------    ----------------

          21.3  Except with respect to the APP Owned Developments or ABI Owned
Developments, ABI further indemnifies APP for any proceedings instituted by or
on behalf of a third party based upon a claim that the manufacture, use or sale
of the Product infringes a patent or any other proprietary right of that third
party. Such indemnification obligation shall be limited as follows:

                (A) to the extent such proceeding or settlement thereof results
     in a future royalty to be paid by APP, ABI's indemnity obligation shall be
     satisfied by having such royalty payment be a deduction from Net Sales; and

                (B) to the extent such proceeding or settlement thereof results
     in a payment obligation other than as provided in Section 21.3(A) above,
                                                       ---------------
     ABI shall indemnify APP only to the extent of fifty percent (50%) of
     payments previously made by APP to ABI pursuant to Section 8.1 hereof, and
                                                        -----------
     any indemnity payments to be made by ABI to APP or on behalf of APP
     pursuant to the foregoing shall be limited to fifty percent (50%) of ABI's
     operating cash flow, including without limitation, the split of Gross
     Profits under this Agreement.

          21.4  If any Party entitled to be indemnified pursuant to this Section
                                                                         -------
21 (an "Indemnified Party") receives notice of the assertion by any Person of
--
any claim or of the commencement by any Person of any Action (any such claim or
Action being referred to herein as an "Indemnifiable Claim") with respect to
                                       -------------------
which another Party hereto (an "Indemnifying Party") is or may be obligated to
                                ------------------
provide indemnification, the Indemnified Party shall promptly notify the
Indemnifying Party in writing (the "Claim Notice"). However, the failure to
                                    ------------
provide the notice will not relieve or otherwise affect the obligation of the
Indemnifying Party to provide

<PAGE>

indemnification under this Agreement, except to the extent that any Damages
directly resulted or were caused by that failure.

          21.5  The Indemnifying Party will have 30 days after receipt of the
Claim Notice to undertake, conduct and control, through counsel of its own
choosing and at its expense, the settlement or defense of the claim, and the
Indemnified Party will cooperate with the Indemnifying Party in connection with
the settlement or defense, if:

                (A)  the Indemnifying Party permits the Indemnified Party to
     participate in the settlement or defense through counsel chosen by the
     Indemnified Party (subject to the consent of the Indemnifying Party, which
     consent shall not be unreasonably withheld);

                (B)  the fees and expenses of such counsel will not be borne by
     the Indemnifying Party; and

                (C)  the Indemnifying Party does not settle any Indemnifiable
     Claim without the Indemnified Party's consent which consent may not be
     unreasonably withheld. So long as the Indemnifying Party is vigorously
     contesting any Indemnifiable Claim in good faith, the Indemnified Party may
     not pay or settle the claim without the Indemnifying Party's consent, which
     consent shall not be unreasonably withheld.

          21.6  If the Indemnifying Party does not notify the Indemnified Party
within 30 days after receipt of the Claim Notice that it elects to undertake the
defense of the Indemnifiable Claim described in the Claim Notice, the
Indemnified Party has the right to contest, settle or compromise the
Indemnifiable Claim in the exercise of its reasonable discretion. However, the
Indemnified Party must notify the Indemnifying Party of any compromise or
settlement of any such Indemnifiable Claim.

          21.7  Notwithstanding anything in this Section 21 to the contrary, APP
                                                 ----------
is not entitled to assume the defense for any Indemnifiable Claim (and will be
liable for the reasonable fees and expenses incurred by the Indemnified Party in
defending the claim) if the Indemnifiable Claim seeks an order, injunction or
other equitable relief (or other relief for other than money damages) against
ABI or its Affiliates which ABI determines, after conferring with its counsel,
cannot be separated from any related claim for money damages and which, if
successful, would adversely affect the commercialization of the Product.
However, if an equitable relief portion of the Indemnifiable Claim can be
separated from that for money damages, APP may assume the defense of the portion
relating to money damages.

     22. Product Liability.
         -----------------

          22.1  Subject to Section 21, each Party must promptly reimburse the
                           ----------
other Party for 50% of the amount of: (A) the costs of responding to or
defending any Product Liability Claim arising from use or sale of the Product in
the Territory, regardless of the reason for such claim except as expressly set
forth in Sections 21.1(C) or 21.1(E); and (B) any Damages payable by the Party
         ---------------     -------
following final judgment or settlement of any Product Liability Claim arising
from use or sale of the Product in the Territory regardless of the reason for
such claim except as expressly set forth in Sections 21.1(C) or 21.1(E). For the
                                            ----------------    -------
sake of clarity, the 50%/50% sharing

<PAGE>

ratio for Product Liability Claims arising from the use or sale of the Product
in the Territory (except as provided in Sections 21.1(C) and 21.1(E)) shall
                                        ----------------     -------
include, without limitation, claims based on allegations of latent defect,
failure to warn, and the establishment of the Specifications.

          22.2  For so long as ABI is conducting clinical trials of the Product
or commercially marketing and selling the Product, it must maintain Product
liability insurance with respect to the Product, with a reputable carrier, in
the amounts set forth in Exhibit B, naming APP and its Affiliates as additional
                         ---------
insureds.

          22.3  For so long as APP is commercially marketing and selling the
Product in the Territory, it must maintain Product liability insurance with
respect to the Product, with a reputable carrier, in the amounts set forth in
Exhibit C, naming ABI and its Affiliates as additional insureds.
---------

          22.4  Each Party must notify the other Party as promptly as
practicable if a Product Liability Claim under Section 22.1 is commenced or
                                               ------------
threatened against any Party. Each Party must cooperate with the other Party in
connection with any such Product Liability Claim that is commenced or threatened
against the other Party.

          22.5  If a Product Liability Claim under Section 22.1 is asserted
                                                   ------------
against both Parties, each Party will have the right to designate counsel to
defend itself in the Product Liability Claim. If a Product Liability Claim under
Section 22.1 is brought against one Party but not the other Party, the named
------------
Party will (subject to Section 22.6) have absolute control of litigation, except
                       ------------

that:

                (A)  the other Party may appoint counsel to participate in the
     defense of the Product Liability Claim if the named Party reasonably
     determines that the participation would not adversely affect the attorney-
     client privilege; and

                (B)  if the litigation could reasonably be expected to have an
     adverse effect on the development and commercialization of the Product, the
     named Party must consult with the other Party regarding the conduct of the
     litigation if the named Party reasonably determines that the cooperation
     would not adversely affect the attorney-client privilege.

          22.6  Neither Party may agree to a settlement of any Product Liability
Claim under Section 22.1 without the consent of the other Party, which consent
            ------------
may not be unreasonably withheld or delayed, if the settlement:

                (A)  would have an adverse effect on the development or
     commercialization of the Product; or

                (B)  would otherwise have a material adverse effect on the other
     Party.

     23.  EXCEPT FOR BODILY INJURY OF A PERSON, NEITHER PARTY WILL BE LIABLE
HEREUNDER UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER LEGAL OR
EQUITABLE THEORY FOR ANY SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES,
INCLUDING WITHOUT LIMITATION, LOSS OF PROFITS FROM THE USE OF (OR INABILITY TO
USE) THE TECHNOLOGY,

<PAGE>

THE DEVELOPMENT OR COMMERCIALIZATION OF THE PRODUCT OR OTHERWISE IN CONNECTION
WITH, OR ARISING OUT OF, THIS AGREEMENT.

     24.  Independent Contractors. ABI and APP are independent Parties, and
          -----------------------
nothing contained herein will be construed to create a joint venture,
partnership or similar relationship. Neither Party is authorized to, nor may it,
make any statements, claims, representations, warranties or otherwise act in any
way so as to incur any liability whatsoever for which the other may become
directly, indirectly or contingently liable.

     25.  Assignment.
          ----------

               25.1  The rights and obligations of the Parties under this
Agreement may not be assigned or transferred in any manner, including, without
limitation, by operation of law, sale of stock or sale of assets, without the
prior written approval, which shall not be unreasonably withheld, of the other
Party (and any attempt to do so will be void) except that:

                     (A)  rights to payment of money may be assigned without
      such approval, and

                     (B)  a Party has the right to assign this Agreement to its
      lenders as collateral security under a credit facility and following
      acceleration of that credit facility, it's lender has the right to assign
      this Agreement to a third party reasonably satisfactory to the other
      Party. Despite the foregoing, in no event shall ABI be obligated to
      consent to an assignment to a Competitor.

          25.2  Notwithstanding anything to the contrary in Section 25.1, if:
                                                            ------------
                (A)  any Party:

                         (1)  merges or consolidates with any other corporation,
          partnership or other business entity, or

                         (2)  all or substantially all of such Party's business
          or assets are transferred in any manner to any other corporation,
          partnership or other business entity; or

               (B)  any other Person acquires the power, directly or indirectly,
      to direct or cause the direction of management and the policies of such
      Party ( a "Change of Control");
                 ------------------

    such event will be deemed an approved assignment for purposes of this
    Agreement if the conditions set forth in this Section 25.3 are satisfied.
                                                  ------------

25.3  Following a Change of Control, such successor to such Party will succeed
to, and be subject to, all rights, interests, duties and obligations of, and
will thereafter be deemed for all purposes to be the applicable Party under this
Agreement. The successor to be approved under this Section 25.3 will be required
                                                   ------------
to:

<PAGE>

               (A)  have the experience, facilities, capabilities, and financial
     resources equal to or greater than such Party; and

               (B)  expressly acknowledge, in a written instrument delivered to
     the other Party in a form reasonably acceptable to the Parties:

                         (1)  the succession to all duties and obligations of
          the Party under this Agreement, and

                         (2)  the existence of the requirements set forth in
          this Section 25.
               ------- --

          25.4  Despite the foregoing, for the purposes of this Agreement, an
IPO will not be considered a Change of Control.

          25.5  If APP's successor does not meet the following requirements in
Section 25.5(A) and 25.5(B) in each calendar year after a Change of Control
------- -------     -------
occurs, ABI may, at its sole option, convert the exclusive license to a non-
exclusive license or terminate this Agreement:

                (A)  spend on marketing and sales at least the same amounts that
     the APP Parties (other than those which have continuing agreements with
     such a successor) and its Affiliates and permitted assignees spent on
     marketing and sales in the calendar year prior to the Change of Control;
     and

                (B)  achieve revenues that are greater than or equal to 90% of
     the greater of:

                         (1)  the revenues of the APP Parties (other than those
          which have continuing agreements with such a successor) in the
          calendar year prior to the Change of Control; or

                         (2)  the average of the revenues of the APP Parties
          (other than those which have continuing agreements with such a
          successor) for the immediately preceding three calendar years .

          25.6  In the event a Change of Control, the foregoing amounts in
Section 25.5 shall be prorated for the portion of the calendar year subsequent
------------
to the Change of Control.

          25.7  If the successor entity fails to achieve the sales level
required in Section 25.5, such successor shall be entitled to make a
            ------------
supplemental payment to ABI (within 45 days after the end of each calendar year)
of an amount equal to: (A) the difference between its actual revenues from the
Product and the revenues required by Section 25.5, multiplied by (B) one-half
                                     ------------
(1/2) of its Gross Profits from Product sales as a percentage of such actual
revenues. Such payment, if made, shall prevent ABI from exercising any other
remedy under Section 25.5 with respect to the calendar year for which such
             ------------
payment is made.

     26.  Notices.  Any and all notices given pursuant to this Agreement must be
          -------
in writing, and will be deemed to have been properly given when delivered
personally or sent by facsimile, air courier, or post, to the respective address
shown below or such other address as shall be

<PAGE>

specified by the Party(ies) pursuant to written notice given in accordance with
this Section 26. Any notice will be effective upon receipt, which will be deemed
     ----------
to occur one business day after the facsimile is send, two business days the
notice is sent by air courier, and five calendar days after the notice is
delivered to the US Postal Service, properly marked and stamped for first class
mail, return receipt requested. Any and all notices must be sent:

     If to ABI to:

          American BioScience, Inc.
          2730 Wilshire Boulevard
          Santa Monica, California 90403
          Attention: Chief Executive Officer
          Facsimile: 310/998-8553

     With a copy to:

          [

          Attention:
          Facsimile:     ]

If to APP to:

          American Pharmaceutical Partners, Inc.
          10866 Wilshire Boulevard
          Los Angeles, California 90024
          Attention: Chief Operating Officer
          Facsimile: 310/470-4222

     With a copy to:

          American Pharmaceutical Partners, Inc.
          1101 Perimeter Drive
          Schaumburg, Illinois 60173
          Attention: General Counsel
          Facsimile: 847/413-2670

     27.  Force Majeure.
          -------------

               27.1  The obligations of a Party hereunder will be suspended
during the time and to the extent that such Party is prevented from complying
with its obligations due to any event or circumstances beyond the reasonable
control and without the fault or negligence of the affected Party (which
circumstance is referred to as "Force Majeure"), including but not limited to
                                -------------
inevitable accidents, perils of navigation, floods, fire, storms, earthquakes,
lockouts, explosion, hostilities, war (whether declared or undeclared), acts of
terrorism, civil disturbances, order or acts of any government, whether de jure
or de facto or any official purporting to act under authority of any such
government (other than as to Regulatory Approval), illegality arising from
domestic or foreign laws or regulations, insurrections, quarantine or custom
restrictions

<PAGE>

(other than due to the action or inaction of the Party claiming a Force
Majeure), damage in factories or warehouses, strikes, lockouts, or other labor
difficulty of the Parties, inability to obtain paclitaxel active pharmaceutical
ingredient or other components and raw materials, lack of conveyance, breakdown
of machinery or instruments or other disturbances of the Parties or their
suppliers or acts of God or other similar event beyond the reasonable control
of, as the case may be, ABI or APP that results in hindrance of the performance
by the Party of its obligations under this Agreement.

          27.2  As soon as possible after being affected by a Force Majeure
circumstance, the affected Party must furnish to the other Party all particulars
of the Force Majeure and the manner in which its performance is prevented or
delayed. The Party whose obligations under this Agreement have been suspended
must promptly and diligently pursue appropriate action to enable it to lift the
Force Majeure situation, except that such Party will not be obligated to settle
any strike, lockout or other labor difficulty on terms contrary to its wishes.

          27.3  If any Force Majeure circumstance cannot be removed or overcome
within 120 days (or such other period as the Parties mutually agree) from the
date the Party affected first became affected, then the non-affected Party may,
at the expiration of such period, by notice to the affected Party terminate this
Agreement, and neither Party will be liable to the other for Damages.

     28.  Amendment and Waiver. This Agreement (including the Exhibits hereto)
          --------------------
may be amended, modified, superseded or canceled, and any other of the terms or
conditions hereof may be modified, only by a written instrument executed by both
Parties or, in the case of a waiver, by the Party waiving compliance. Failure of
either Party at any time or times to require performance of any provision hereof
will in no manner affect the right of such Party at a later time to enforce the
same, and no waiver of any nature, whether by conduct or otherwise, in any one
or more instances, will be deemed to be or considered as a further or continuing
waiver of any provision of this Agreement.

     29.  Severability.  If any one or more of the agreements, provisions or
          ------------
terms contained herein are declared invalid, illegal or unenforceable in any
respect, the validity of the remaining agreements, provisions or terms contained
herein will not be affected, prejudiced or invalidated thereby.

     30.  Entire Agreement.  This Agreement, the Security Agreement noted in
          ----------------
Section 8.2 and all Exhibits hereto, contain the entire agreement between the
-----------
Parties, and supersedes any prior agreements between them, with respect to the
subject matter hereof.

     31.  Section Headings; Recitals. The section headings contained in this
          --------------------------
Agreement are for reference purposes only and do not affect in any way the
meaning or interpretation of this Agreement. The recitals are hereby
incorporated into this Agreement by reference.

     32.  Governing Law.  This Agreement shall be governed by and construed and
          -------------
enforced in accordance with the substantive law (without regard to conflicts of
law provisions) of the State of California.

     33.  Arbitration; Equitable Relief.
          -----------------------------

<PAGE>

          33.1  Except in the case of a Party seeking equitable relief
hereunder, any and all disputes or controversies, whether of law or fact and of
any kind and nature whatsoever, arising out of or relating to this Agreement,
will be decided by binding arbitration in accordance with Title 9 of the United
States Code and the Commercial Arbitration Rules of the American Arbitration
Association ("AAA"). For claims under $1,000,000, the arbitration will be held
              ---
before a single arbitrator. If the Parties are unable to agree on an arbitrator,
the arbitration will be held before an arbitrator selected by AAA. For claims
over $1,000,000, the arbitration will be held before a three-member panel of
arbitrators. If the Parties are unable to agree on a three-member panel of
arbitrators, the arbitration will be held before a three-member panel of
arbitrators selected by the AAA. Arbitration shall take place in Los Angeles
County, State of California, or such other location as may be agreed by the
Parties. Claims with respect to injunctive relief or specific performance will
be resolved by a court of law in accordance with Section 33.2. APP irrevocably
                                                 ------------
consents and submits to personal jurisdiction in the State of California for any
arbitration contemplated by this Section 33.1. The decision of the arbitrators
                                 ------------
will be binding upon the Parties hereto and all parties claiming under and
through them, and judgment will be entered by any court of competent
jurisdiction. The fees and expenses of the arbitrator will be paid equally by
the Parties.

          33.2  With respect to actions for injunctive relief and specific
performance, the Parties submit to the jurisdiction of any state or federal
court sitting in Los Angeles County in any Action arising out or respecting this
Agreement and agree that all claims in respect of such Action shall be heard and
determined in any such court. The Parties waive any defense of inconvenient
forum to the maintenance of any Action and waive any bond, surety or other
security that may be required of any other party with respect to the Action. The
Parties agree that a final judgment in any Action brought under this Section
                                                                     -------
33.2 will be conclusive. Either Party may seek injunctive relief if any
----
provision of this Agreement is not performed in accordance with its terms and
for which such Party would not have an adequate remedy for money damages. Any
such remedy will be in addition to any other remedy that may be available at law
or equity.

     34.  Counterparts. This Agreement may be executed in separate counterparts,
          ------------
each of which will be deemed to be an original, but which together will
constitute one and the same instrument.

<PAGE>

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date
first above written.

                                         AMERICAN BIOSCIENCE, INC.,
                                         a California corporation

                                         By: /s/ Patrick Soon-Shiong
                                             -----------------------
                                                 Patrick Soon-Shiong
                                                 President

                                         AMERICAN PHARMACEUTICAL PARTNERS, INC.,
                                         a California corporation

                                         By: /s/ Jeffrey M. Yordon
                                             ---------------------
                                                 Jeffrey M. Yordon
                                                 Chief Operating Officer

<PAGE>

                                   EXHIBIT A

                                  ABI Patents
                                  -----------

                                     [***]

<PAGE>

                                   EXHIBIT B

                                 ABI Insurance
                                 -------------

                                     [***]

<PAGE>

                                   EXHIBIT C

                                 APP Insurance
                                 -------------

                                     [***]

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