Document:

<PAGE>

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.

                                                                 EXHIBIT 10.18

                                 LICENSE AGREEMENT

     Effective this Twenty-Fifth day of March, 1999, the MCW RESEARCH
FOUNDATION, INC. ("MCWRF"), a body having corporate powers under the laws of the
State of Wisconsin and the wholly owned subsidiary of the MEDICAL COLLEGE OF
WISCONSIN, INC. ("MCW"), and INTERMUNE PHARMACEUTICALS, INC. ("INTERMUNE") a
corporation, having a place of business at 2483 East Bayshore Road, Suite 103,
Palo Alto, CA, U.S.A., agree as follows:

1.   DEFINITIONS:

     (a)  "PSEUDOMONAS V ANTIGEN" means [ * ] developed by [ * ] (the
"Inventors").

     (b)  "LICENSED RIGHTS" means any subject matter claimed in or covered by
U.S. Provisional Patent Serial No. [ * ], filed on behalf of the Inventors and
the Regents of the University of California ("THE REGENTS") by MCWRF on [ * ];
and any divisions, continuations, or continuations-in-part (but only to the
extent that such continuations-in-part have inventors from both institutions)
thereof; any corresponding foreign applications thereof, and any U.S. or joint
foreign patents issued thereon or reissues or extensions thereof assigned by
each inventor to his/her respective institution.

     (c)  "LICENSED PRODUCT(S)" means [ * ] manufacture, use or sale.  For all
other fields of use, including but not limited to the field of [ * ].

2.   BACKGROUND:

     (a)  MCWRF represents that it is the owner and sole administrator by
assignment, and by interinstitutional agreement with the Regents of the Licensed
Rights.  MCWRF desires to grant a license for making the Licensed Product(s)
commercially available for public use and benefit.

     (b)  INTERMUNE wishes to acquire an exclusive LICENSE as herein specified.

3.   LICENSE GRANT:

     (a)  MCWRF hereby grants and INTERMUNE hereby accepts an exclusive
world-wide license under the Licensed Rights to make, have made, use, and
sell Licensed Product(s).

     (b)  The license grant of Paragraph 3.a. shall include the right to grant
sublicenses to others during the term of this Agreement.

     (c)  The development of this invention was sponsored in part by the
National Institutes of Health, Department of Health and Human Services, and as a
consequence this license is subject to overriding obligations to the Federal
Government under 35 U.S.C. 200-212 and 37 C.F.R. 401.

                             1.

<PAGE>

     (d)  MCWRF and THE REGENTS reserve the Licensed Rights for educational and
research purposes.

4.   FEES AND ROYALTIES:

     (a)  In consideration of the License granted herein, INTERMUNE shall pay to
MCWRF:

          (i)   a licensed issue fee in the sum of Fifty Thousand Dollars
($50,000.00) payable upon execution of this agreement;

          (ii)  the sum of One Hundred Thousand Dollars ($100,000.00)
                payable upon filing an IND for each Licensed Product;

          (iii) the sum of Two Hundred Fifty Thousand Dollars ($250,000.00)
                payable upon initiation of a Phase III clinical trial for each
                Licensed Product.

          (iv)  the sum of Six Hundred Fifty Thousand Dollars ($650,000.00)
                payable upon submission of an NDA for each Licensed Product;

          (v)   the sum of One Million Dollars ($1,000,000.00) payable upon
                receiving approval of an NDA for each licensed product;

     (b)  These sums are not advances against earned royalties provided for in
Paragraph 4.c.

     (c)  In consideration of the license granted herein, INTERMUNE shall pay
to MCWRF two and one-half (2.5) percent of net sales for each and every
Licensed Product(s) which is sold, irrespective of selling price, given as a
promotional item or gift, included with the sale of other equipment, or
transferred or caused to be transferred, to any other party by INTERMUNE.
Net sales shall mean gross sales lease:

          (i)   trade and/or quantity discounts as are customary in the trade;

          (ii)  taxes or other governmental charges on the production, sales,
transportation, delivery or use of licensed products;

          (iii) transportation charges;

          (iv)  sales commissions paid to non-affiliated parties; and

          (v)   amounts repaid or credited by reasons of recall or return.

     (d)  Royalties pursuant to Paragraph 4.c. shall not be due by INTERMUNE to
MCWRF on Licensed Product(s) delivered to any third party solely for evaluation,
demonstration, or the like.

     (e)  All royalties due hereunder by INTERMUNE to MCWRF shall be paid to
MCWRF in United States Dollars.  When Licensed Products are sold for monies
other than United States Dollars, INTERMUNE shall first determine the earned
royalty in the currency of the country in which the Licensed Products were sold
and then convert the amount into equivalent United States Dollars, using the
exchange rate quoted in the Wall Street Journal on the last business day of the
reporting period, as provided for in Article 5.

     (f)  INTERMUNE shall be responsible for all bank transfer charges.

[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED
BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
                                 2.

<PAGE>

5.   REPORTS, PAYMENTS AND ACCOUNTING:

     (a)  INTERMUNE agrees to make written progress reports to MCWRF within
sixty (60) days of each June 30 and each December 31 during the life of this
Agreement covering activities related to the development and testing of all
Licensed Products and the status of government approvals necessary for
marketing.  Progress reports are required for each Licensed Product until the
first commercial sale of that Licensed Product occurs in the United States.
Progress reports submitted under Paragraph 5.a. shall include, but are not
limited to, the following topics:

          (i)   summary of work completed;

          (ii)  key scientific discoveries;

          (iii) summary of work in progress;

          (iv)  schedule of anticipated events or milestones;

          (v)   marketing plans for introducing Licensed Products; and

          (vi)  summary of resources (dollar value) expended during the
reporting period.

     (b)  INTERMUNE agrees to make written reports to MCWRF within sixty (60)
days of each June 30 and each December 31 during the life of this Agreement
stating in each such report the number of Licensed Product(s) used, sold, given,
included in sales of other products or equipment, transferred or leased by
INTERMUNE, upon which royalties are payable pursuant to Article 4. hereof for
the prior six (6) month period.

     (c)  INTERMUNE also agrees to make a similar written report to MCWRF within
ninety (90) days after the date of the termination of this Agreement on Licensed
Product(s) sold, given, included in sales of other products or equipment,
transferred or leased by INTERMUNE and upon which royalties are payable
hereunder but which were not previously reported.

     (d)  Concurrently with the making of each report required under this
Article 5.b. and 5.c., INTERMUNE shall pay to MCWRF all royalties due hereunder
in connection with the transactions so reported.

     (e)  During the term of this Agreement, and for a period of seven (7) years
after the termination of this Agreement, INTERMUNE agrees to keep records
showing the manufacture, sales, use, leases, gifts, inclusions and transfers of
Licensed Product(s) in sufficient detail to enable the royalties due and payable
hereunder by INTERMUNE to be determined, and further agrees to permit its books
and records to be examined from time to time to the extent necessary, but not
more than once a year, to verify reports provided for in Paragraphs 5.b. and
5.c. hereof.  Such examination is to be made by an independent certified
accountant appointed by MCWRF, with the fees and expenses to be borne by MCWRF.

6.   PATENTS:

[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED
BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.
                                   3.

<PAGE>

     (a)  MCWRF agrees to pursue and maintain patent protection of the
Pseudomonas V Antigen technology commencing on the date of this License
Agreement, using counsel to be mutually agreed upon, with the costs of
preparing, filing, prosecuting and maintaining such protection to be paid by
INTERMUNE.  The initial License fee ($50,000) shall be creditable against patent
expenses incurred prior to the date of this agreement.  INTERMUNE will be billed
for additional patent expenses by MCWRF as the costs are incurred.

     (b)  INTERMUNE may request MCWRF to obtain patent protection in foreign
countries.  INTERMUNE shall notify MCWRF of this request not less than ninety
(90) days prior to the deadline for any filing, action, or payment to be made in
connection therewith.  The notice of request must be in writing, must identify
the countries desired, and must reaffirm INTERMUNE's obligation to underwrite
the costs thereof.  The absence of such a notice from INTERMUNE will be
considered an election not to obtain or maintain foreign rights.  MCWRF may
prosecute and maintain such rights at its sole discretion and expense in any
country in which INTERMUNE has not elected to file, prosecute, or maintain
patents in accordance with this Article, but INTERMUNE will have no rights or
licenses thereunder.

     (c)  INTERMUNE's obligation to underwrite and pay patent costs will
continue for so long as this Agreement is in effect.  However, INTERMUNE may
terminate its obligations with respect to any given patent application or patent
upon ninety (90) days written notice to MCWRF. MCWRF may prosecute and maintain
such rights at its sole discretion and expense, but INTERMUNE will have no
further rights or licenses thereunder.

7.   WARRANTIES AND INDEMNITIES:

     (a)  Nothing in this Agreement shall be construed as:

          (i)   A warranty or representation that anything made, used, sold,
rented or leased, under any license granted by this Agreement is or will be free
from infringement of patents of third parties;

          (ii)  Granting by implication, estoppel, or otherwise any licenses or
right under patents of MCWRF or THE REGENTS regardless of whether such patents
dominate or are subordinate to any Licensed Rights.  The foregoing
notwithstanding, MCWRF hereby informs INTERMUNE that they know of no patents
which dominate the Licensed Rights and under which MCWRF has the right to grant
licenses.

     (b)  MCWRF AND THE REGENTS MAKE NO REPRESENTATIONS, EXTENDS NO WARRANTIES
OF ANY KIND, EITHER EXPRESSED OR IMPLIED. THERE ARE NO EXPRESSED OR IMPLIED
WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE
USE OF THE LICENSED PRODUCT(S) WILL NOT INFRINGE ANY PATENT, COPYRIGHT,
TRADEMARK, OR OTHER RIGHTS.

     (c)  INTERMUNE shall indemnify, hold harmless, and defend MCWRF and MCW,
THE REGENTS, their officers, employees, and agents, and the inventors against
any and all claims, suits, losses, liabilities, damages, costs, fees, and
expenses resulting from or arising out of exercise of this license. This
indemnification includes, but is not limited to, any product liability.

[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED
BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.                            4.

<PAGE>

8.   INFRINGEMENT BY OTHERS:

     INTERMUNE shall promptly inform MCWRF of any suspected infringement of any
Licensed Rights by a third party, and MCWRF and INTERMUNE shall consult in good
faith to agree on a mutually beneficial course of action.

9.   TERM AND TERMINATION:

     (a)  The word "termination" and cognate words, such as "term" and
"terminate" as used in this Agreement, are to be read, except where the contrary
is specifically indicated, as omitting from their effect the following rights
and obligations, all of which survive any termination to the degree necessary to
permit their complete fulfillment or discharge:

          (i)   INTERMUNE's obligation to supply a terminal report as specified
in Paragraph 5.c.  hereof;

          (ii)  MCWRF's rights to receive or recover and INTERMUNE's obligation
to pay fees and royalties, pursuant to Article 4. hereof, and pay patent
expenses incurred, pursuant to Article 6.  hereof, due or accruable for payment
at the time of any termination;

          (iii) INTERMUNE's obligation to maintain records and MCWRF's right to
conduct audits as provided in Paragraph 5.e.  hereof;

          (iv)  Releases running in favor of customers of INTERMUNE with respect
to Licensed Product(s) sold or transferred prior to any termination and on which
royalties have been paid or are payable by INTERMUNE to MCWRF as provided in
Article 4. hereof;

          (v)   Any cause of action or claim of either party hereto, accrued or
to accrue, because of any breach or default by the other party; and

          (vi)  The provisions of Article 7.

10.  DUE DILIGENCE:

     (a)  INTERMUNE, on execution of this Agreement shall diligently proceed
with the development, manufacture and sale of Licensed Products and shall
earnestly and diligently endeavor to market same within a reasonable time after
execution of this Agreement and in quantities sufficient to meet market demands.

     (b)  INTERMUNE shall endeavor to obtain all necessary government approvals
for the manufacture, use and sale of Licensed Products.

     (c)  INTERMUNE SHALL:

          (i)   file an IND and begin Phase I Clinical Trials within [ * ] years
of executing this Agreement;

[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED
BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

                                      5.
<PAGE>

          (ii)  initiate Phase II and Phase III Clinical Trials within [ * ]
years of beginning Phase I Clinical Trials;

          (iii) file an NDA within [ * ] years of beginning Phase III Clinical
Trials;

          (iv)  market a Licensed product within [ * ] years of filing an NDA.

     (d)  If INTERMUNE is unable to meet any of the above due diligence
provisions, MCWRF reserves the right to terminate this Agreement upon written
notice to INTERMUNE, which termination shall become effective sixty (60) days
after MCWRF's sending written notice of such termination unless such provision
has been met prior to the expiration of the sixty day period.

     (e)  From time to time, INTERMUNE may suggest modifications to the
diligence provisions above based on new information.  Such modifications shall
be effective only as mutually agreed upon, in writing, by the Parties.  MCWRF
shall consider such requested modifications in good faith and shall agree to
modifications that are reasonably necessary to achieve the overall objectives of
the development of the Licensed Product.

     (f)  In the event that INTERMUNE determines that it will be unable to meet
any of the diligence provisions, INTERMUNE shall notify MCWRF of such inability,
identifying the nature of the inability with reasonable specificity and may ask
MCWRF for a reasonable extension of time in which to complete such provision.
At MCWRF's sole discretion, MCWRF may grant InterMune such an extension to
complete the provision.

     (g)  If INTERMUNE shall at any time default in the payment of any earned
royalty or the making of any report hereunder, or shall commit any material
breach of any covenant herein contained, or shall make any materially false
report and shall fail to remedy any such default, breach, or report within
ninety (90) days after written notice thereof by MCWRF, MCWRF may, at its
option, terminate this Agreement and the licenses herein granted by notice in
writing to such effect.

     (h)  INTERMUNE shall have the right to terminate this Agreement in respect
to any or all Licensed Patent(s), upon giving at least ninety (90) days written
notice to MCWRF of its intention and desire to terminate.

11.  USE OF NAMES AND TRADEMARKS:

     Nothing contained in this Agreement confers any right to use in
advertising, publicity, or other promotional activities, any name, trade name,
trademark, or other designation of any party hereto or THE REGENTS.

12.  ASSIGNMENT:

     This Agreement may not be assigned.

13.  APPLICABLE LAW:

[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED
BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

                                      6.
<PAGE>

     This Agreement shall be construed, interpreted, and applied in accordance
with the laws of the State of Wisconsin.

14.  ARBITRATION:

     (a)  Any controversy arising under or related to this Agreement, and any
disputed claim by either party against the other under this Agreement,
including, without limitation, disputes relating to patent validity or
infringement, shall be settled by arbitration, upon the request of either party,
in accordance with the then-prevailing Patent Arbitration rules of the American
Arbitration Association (AAA).  In the event of such controversy, the matter
shall be submitted to one arbitrator knowledgeable in the field, who has been
selected by mutual agreement of the parties hereto or by the AAA if the parties
cannot agree.

     (b)  Any arbitration under Paragraph 14.a. hereof shall be held at
Milwaukee, Wisconsin, or such other place as may be mutually agreed upon in
writing between the parties, and judgment upon the award rendered by the
arbitrator may be entered in any court having jurisdiction thereof.

15.  NOTICES:

     All notices, demands, or other writings in this Agreement provided to be
given, made, or sent, or which may be given, made, or sent by either party
hereto to the other, shall be deemed to have been fully given, made, or sent
when done in writing and deposited in the United States mail, first class,
postage prepaid, and addressed as follows:

     To MCWRF:      MCW Research Foundation
                    8701 Watertown Plank Road
                    Milwaukee, WI 53226
                    Attn:  William R. Hendee, Ph.D.
                    Executive Vice President

     To INTERMUNE:  Intermune Pharmaceuticals, Inc.
                    3294 West Bayshore Road
                    Palo Alto, CA 94303
                    Attn:  Woodruff Emlen, M.D.
                    Vice President, Exploratory Medicine

     The address to which any notice, demand, or other writing may be given or
made or sent to any party may be changed upon written notice given by such party
as above provided.

16.  WAIVER:

     The parties covenant and agree that, if either party hereunder fails or
neglects for any reason to take advantage of any of the terms hereof provided
for the termination of this Agreement, or if a party, having the right to
declare this Agreement terminated, shall fail to do so, any such failure or
neglect by such party shall not be or be deemed or be construed to be a waiver
of any of the terms, covenants, or conditions of this Agreement or of the
performance thereof.  None of the terms, covenants, and conditions of this
Agreement can be waived except by the written consent of the party waiving
compliance.

[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED
BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

                                      7.
<PAGE>

17.  SCOPE OF AGREEMENT:

     (a)  The article headings herein are for convenience only and in no manner
affect the rights and obligations of the parties, nor shall they be used to
interpret the provisions hereof.

     (b)  This Agreement constitutes the entire agreement between the parties
pertaining to the Licensed Rights.  No representative of MCWRF or INTERMUNE has
been authorized to make any representation, warranty, or promise not contained
herein.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement by
their officers or representatives duly authorized as of the date first herein
above written. Execution of this agreement by INTERMUNE is subject to approval
by the INTERMUNE Board of Directors, within 30 days of the date first herein
above written.

MCW RESEARCH FOUNDATION, INC.                INTERMUNE PHARMACEUTICALS, INC.

By: /s/  Joseph O. Hill                      By:  /s/ W. Scott Harkonen
   ----------------------------------------       -----------------------------

Title: Joseph O. Hill, Ph.D. Vice President  Title:  President & CEO
      -------------------------------------        ----------------------------
Date:  3/25/99                               Date:  3/25/99
     --------------------------------------       -----------------------------

[ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED
BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND
EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS
AMENDED.

                                      8.<PAGE>

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT, MARKED BY BRACKETS,
HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE
COMMISSION PURSUANT TO RULE 406 OF THE SECURITIES ACT OF 1933, AS AMENDED.

                                                                  EXHIBIT 10.19

                                 DATA TRANSFER,

                        CLINICAL TRIAL AND MARKET SUPPLY

                                    AGREEMENT

THIS DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT (the
"Agreement"), is made effective as of the 27th day of January, 2000 (the
"Effective Date") by and between InterMune Pharmaceuticals, Inc. ("InterMune"),
a California corporation, having an address at 3400 West Bayshore Road, Palo
Alto, California 94303-4227, USA, and Boehringer Ingelheim Austria GmbH ("BI
Austria"), an Austrian corporation, having its registered office at Dr.
Boehringer-Gasse 5 - 11, A-1121 Vienna, Republic of Austria. InterMune and BI
Austria may be referred to herein each individually as a "Party" and jointly as
the "Parties."

WHEREAS, pursuant to the terms of a Confidential Non-Disclosure Agreement dated
June 5, 1998, between InterMune and Bender+Co Ges mbH (now BI Austria) the
Parties have discussed and evaluated the feasibility of providing manufacturing
services regarding a recombinant gamma-interferon product for InterMune and
Bender (now BI Austria) has submitted a price quotation for these services; and

WHEREAS, InterMune holds an exclusive sublicense from Connetics Corporation
under Connetics' license from Genentech Inc., a company organized under the
laws of Delaware, ("Genentech") to manufacture, use and sell recombinant
human gamma-interferon ("INTERFERON GAMMA 1b", as further described herein)
products in the USA and certain other territories. INTERFERON GAMMA 1b is
approved by the FDA for the indication Chronic Granulomatous Disease, and is
sold in the USA under the trade-mark ACTIMMUNE-Registered Trademark- (the
"GENENTECH PRODUCT", as further described herein), and InterMune intends to
seek approval for additional indications; and

WHEREAS, Boehringer Ingelheim International GmbH (BII), an affiliate of BI
Austria and BI Pharma KG, holds an exclusive license from Genentech to
manufacture, use and sell INTERFERON GAMMA 1b in the BI Territory (as further
described herein), and is the registration-holder for an INTERFERON GAMMA 1b
product in certain countries of the BI Territory for the indication Chronic
Granulomatous

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     1 of 66
<PAGE>

Disease. The trade-mark for INTERFERON GAMMA 1b product in Europe is
IMUKIN-Registered Trademark- (the "BI PRODUCT", as further described herein);
and

WHEREAS, BI Austria and its affiliate BI Pharma KG (as defined hereinafter) own
facilities specialized for cGMP manufacture of biopharmaceuticals and employ
personnel who have experience in the production, quality control as well as in
the registration of biopharmaceuticals; and

WHEREAS, InterMune wishes BI Austria, and BI Austria agrees, to (a) compare the
technical and analytical documentation of GENENTECH PRODUCT and BI PRODUCT, (b)
carry out conformance / qualification runs for the cGMP manufacture of a
finished INTERFERON GAMMA 1b product; (c) conduct an analytical comparison of
the GENENTECH PRODUCT and the BI PRODUCT in order to show comparability between
the GENENTECH PRODUCT and the BI PRODUCT; and (d) prepare for an FDA inspection
in order for BI Austria to be registered with the FDA as a cGMP-compliant
manufacturer for an INTERFERON GAMMA 1b product to be sold under the ACTIMMUNE
trademark for the US market and other territories controlled by InterMune; and

WHEREAS, InterMune wishes BI Austria, and BI Austria agrees, to manufacture and
supply InterMune with finished INTERFERON GAMMA 1b product for its conduct of
clinical trials and supply of market needs for a period of six (6) years in
accordance with the terms and conditions of this Agreement; and

WHEREAS, InterMune wishes BI Austria, and BI Austria agrees, to increase its
manufacturing capability for bulk and finished INTERFERON GAMMA 1b product in
accordance with a mutually agreed-upon plan and timeline as further described
herein.

NOW, THEREFORE, the Parties hereto agree as follows:

1.       DEFINITIONS

The following capitalized definitions will apply throughout this Agreement:

1.1.      AFFILIATE means (i) any corporation or business entity fifty percent
          (50%) or more of the voting stock of which is and continues to be
          owned directly or indirectly by any party hereto; (ii) any corporation
          or business entity which directly or indirectly owns fifty percent
          (50%) or more of the voting stock of any party hereto; or (iii) any
          corporation or business entity under the direct or indirect control of
          such corporation or business entity as described in (i) or (ii).

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     2 of 66
<PAGE>

1.2.      APPROVAL means a regulatory approval required from a HEALTH AUTHORITY
          in order to manufacture BBS or PRODUCT for use in clinical trials or
          market supply as applicable, in the applicable jurisdiction.

1.3.      ATS means the Austrian Shilling.

1.4.      BI AUSTRIA'S IMPROVEMENTS shall mean all INFORMATION comprising any
          inventions, modifications and/or improvements to the INTERMUNE
          TECHNOLOGY or to the GENENTECH TECHNOLOGY, that BI Austria or BI
          Pharma KG conceive of or reduce to practice pursuant to this
          Agreement, either individually or in conjunction with one or more
          third parties or BI Affiliates, including all patent and patent
          applications covering any of the foregoing.

1.5.      BI AUSTRIA'S TECHNOLOGY means all INFORMATION in the field of
          manufacturing and testing of biopharmaceuticals, including without
          limitation the MANUFACTURING PROCESS but only to the extent that it
          relates solely to BI PRODUCT, and including all patents and patent
          applications covering any of the foregoing, that are owned or
          CONTROLLED by BI Austria or BI Pharma KG during the term of this
          Agreement and that are related to or useful in BI Austria's carrying
          out its obligations under this Agreement, but specifically excluding
          INTERMUNE'S TECHNOLOGY and BI AUSTRIA'S IMPROVEMENTS.

1.6.      BI TERRITORY means the territory described in EXHIBIT 1 hereto.

1.7.      BII means Boehringer Ingelheim International GmbH, an AFFILIATE of BI
          Austria GmbH and BI Pharma KG.

1.8.      BI PHARMA KG means BI Austria's AFFILIATE BI Pharma KG, FRG-88397
          Biberach an der Riss, Birkendorfer Strasse 65, Germany, owning an
          FDA inspected and cGMP-certified facility.

1.9.      BI PRODUCT means the liquid formulation of INTERFERON GAMMA 1b
          approved in various countries of the BI Territory for the treatment of
          Chronic Granulomatous Disease, and manufactured by BI Austria and BI
          Pharma KG for sale. In Europe the BI PRODUCT is sold under the
          trademark IMUKIN-Registered Trademark-.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     3 of 66
<PAGE>

1.10.     BLA means a Biologics License Application, as defined by the
          regulations promulgated under the FD&C ACT, and any equivalent
          application with respective HEALTH AUTHORITIES.

1.11.     BULK BIOLOGICAL SUBSTANCE (BBS) means a bulk form of the PRODUCT. This
          bulk form is the [ * ].

1.12.     BULK SPECIFICATIONS mean the specifications for BBS listed in EXHIBIT
          2.

1.13.     cGMP means the current Good Manufacturing Practices of all applicable
          HEALTH AUTHORITIES, including without limitation the FDA, and
          including without limitation all applicable rules, regulations, guides
          and guidance, such as 21C.F.R. parts 210 and 211 and parts 600 and
          610.

1.14.     CMC means the Chemistry, Manufacturing, and Controls content of a
          submission to a HEALTH AUTHORITY.

1.15.     COA means a Certificate of Analysis, a document listing testing
          parameters, specifications and test results (in a format and detail as
          listed in EXHIBIT 3).

1.16.     COC means a Certificate of Compliance confirming compliance with cGMP
          regulations and signed by BI Austria's authorized Qualified Person,
          the Head of Production and the Head of Quality Assurance (in a format
          and such detail as listed in EXHIBIT 4).

1.17.     CONFIDENTIAL INFORMATION means any proprietary INFORMATION (a)
          disclosed by one Party to the other (including without limitation,
          such INFORMATION as was disclosed under the Confidential
          Non-Disclosure Agreement dated June 5, 1998, between InterMune and
          Bender+Co Ges mbH (now BI Austria), or (b) developed by either Party
          pursuant to this Agreement, except for INFORMATION which (i) is
          already in the public domain at the time of its disclosure to the
          receiving Party; (ii) becomes part of the public domain through no
          wrongful action or omission of the receiving Party after disclosure to
          the receiving Party; (iii) is already known to the receiving Party at
          the time of disclosure as evidenced by the receiving Party's written
          records; or (iv) is independently developed by the receiving Party
          without the use or application of the disclosing Party's proprietary
          information.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     4 of 66
<PAGE>

1.18.     CONTROLLED means, with respect to any material, INFORMATION or
          intellectual property right, possession of the ability by a Party to
          grant access, a license, or a sublicense to such material, INFORMATION
          or intellectual property right as provided for herein without
          violating an agreement with a Third Party as of the time such Party
          would be first required hereunder to grant the other Party such
          access, license or sublicense.

1.19.     FDA means the United States Food and Drug Administration and any
          successor agency thereto.

1.20.     FD&C ACT means the United States Food, Drug & Cosmetic Act as amended
          from time to time and any supplements thereunder, and any equivalent
          regulation of any HEALTH AUTHORITIES.

1.21.     FILLING SITE CHANGE means the transfer of the filling and finishing
          part of the MANUFACTURING PROCESS from BI Austria to BI Pharma KG.

1.22.     FINAL RELEASE means the release of PRODUCT by InterMune or its
          licensees for clinical trial use or market supply, as applicable.

1.23.     GENENTECH PRODUCT means the formulation of INTERFERON GAMMA 1b
          manufactured in the US by Genentech for sale under the trademark
          ACTIMMUNE and approved by the FDA for the treatment of Chronic
          Granulomatous Disease.

1.24.     GENENTECH TECHNOLOGY means all INFORMATION relating to the
          manufacture, use or sale of INTERFERON GAMMA 1b that is licensed to
          either Party pursuant to an agreement with Genentech, including
          without limitation the MANUFACTURING PROCESS, and all patents and
          patent applications covering such INFORMATION.

1.25.     HEALTH AUTHORITIES mean all regulatory authorities having jurisdiction
          over the manufacture, use and/or sale of the PRODUCT in the TERRITORY,
          including but not limited to the FDA.

1.26.     INFORMATION means (a) techniques, data, inventions, practices,
          methods, knowledge, know-how, skill, experience, test data (including
          pharmacological, toxicological and clinical test data), analytical and
          quality control data, regulatory submissions, correspondence and
          communications, marketing, pricing, distribution, cost, sales,
          manufacturing, patent and legal

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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<PAGE>

          data or descriptions, compositions of matter, assays and biological
          materials, and (b) all intellectual property rights in and to any of
          the foregoing.

1.27.     INTERFERON-GAMMA 1B means the recombinant human Interferon-Gamma 1b
          derived from a [ * ], and that is the active ingredient in
          ACTIMMUNE-Registered Trademark-. The relevant amino acid sequence is
          set forth in EXHIBIT 5.

1.28.     INTERMUNE'S TECHNOLOGY means all INFORMATION that is CONTROLLED by
          INTERMUNE during the term of this Agreement that is related to or
          useful in BI Austria's manufacture of PRODUCT hereunder, and all
          patents and patent applications covering any of the foregoing;
          provided that "INTERMUNE'S TECHNOLOGY" shall not include any
          INFORMATION (i) owned or CONTROLLED by BI Austria prior to the
          Effective Date, (ii) conceived of, or reduced to practice or acquired
          by BI Austria outside of this Agreement during the term of this
          Agreement, or (iii) the GENENTECH TECHNOLOGY.

1.29.     MCB means the original Master Cell Bank derived from the [ * ] and
          established by Genentech.

1.30.     MANUFACTURING PROCESS means the process for fermentation,
          purification, filling, labeling and packaging of BBS and PRODUCT, as
          described in EXHIBIT 6.

1.31.     MATERIAL SUPPLY BREACH means a failure of BI Austria: (a) to supply to
          InterMune at least ninety percent (90%) of InterMune's binding
          forecasted requirements of PRODUCT (or actual orders, if less) that
          are due for delivery by the designated delivery date during the
          then-current calendar quarter; or (b) to repeatedly (maximum two (2)
          times) materially violate against cGMP, as described in Sections 5.6
          and 5.7.

1.32.     PRODUCT shall mean a finished product consisting of formulated
          INTERFERON GAMMA 1b filled into the designated containers for clinical
          supply and for market supply, as described in EXHIBIT 7, or shall mean
          a finished product of formulation buffer filled into the designated
          containers for clinical supply (placebo).

1.33.     PROJECT MANAGER means the responsible person designated by each Party
          to be responsible for the communication of all information concerning
          this Agreement. As of the Effective Date, the person designated as
          InterMune's PROJECT MANAGER and the person designated as BI Austria's
          PROJECT MANAGER are listed in EXHIBIT 8. Either Party may

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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          change its own designated PROJECT MANAGER by providing written notice
          thereof to the other Party.

1.34.     PRODUCT SPECIFICATIONS mean the specifications for the PRODUCT as set
          forth in EXHIBIT 9, or as otherwise agreed by the Parties in writing.

1.35.     PROJECT TEAM means the team as listed in EXHIBIT 8 and described in
          Section 6.1.

1.36.     QUALITY ASSURANCE REQUIREMENTS mean InterMune's quality assurance
          requirements as set forth in EXHIBIT 10, as may be amended from time
          to time by written agreement of the Parties.

1.37.     RELEASE means the release of the PRODUCT by BI Austria to InterMune or
          its designee.

1.38.     SERVICES mean the services to be performed by BI Austria and BI Pharma
          KG in connection with establishing comparability between the GENENTECH
          PRODUCT and the BI PRODUCT for cGMP purposes, and preparing BI Austria
          to be approved by the FDA as a cGMP manufacturer of the PRODUCT, as
          further described in EXHIBIT 11. EXHIBIT 11 also includes the costs
          for the SERVICES. The timeline within which BI Austria and BI Pharma
          KG intend to perform the SERVICES is described in EXHIBIT 12.

1.39.     STEERING COMMITTEE means the committee as listed in EXHIBIT 13 and as
          further described in Section 6.2.

1.40.     TERRITORY means the US, Japan and all additional territories,
          including but not limited to Canada, as to which InterMune has or may
          acquire the right to manufacture, use or sell INTERFERON GAMMA 1b
          products during the term of this Agreement.

1.41.     US means the United States of America.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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2.       DATA TRANSFER AND PRODUCT COMPARISON

2.1.     INTERMUNE'S TASKS AND RESPONSIBILITIES

         2.1.1.   DOCUMENTATION

                  InterMune shall provide BI Austria with the relevant
                  documentation that is reasonably available to InterMune
                  concerning the GENENTECH PRODUCT and its manufacture by
                  Genentech, including amendments and currently used batch
                  records and testing procedures and all material correspondence
                  with the HEALTH AUTHORITIES in the US as listed in EXHIBIT 14.
                  The Parties acknowledge that BI Austria is already in receipt
                  of most of the relevant documentation.

         2.1.2.   MATERIAL

                  InterMune shall provide BI Austria with original [ * ]
                  vials from Genentech and samples of BBS manufactured by
                  Genentech, as well as of the final labeled product
                  ACTIMMUNE-Registered Trademark-, in such reasonable amounts
                  and at such times as agreed by the Project Team. InterMune
                  shall also supply BI Austria, as reasonably requested and
                  in reasonable amounts, with reference material, antibodies
                  and reagents for analytical testing, and all other material
                  reasonably available to InterMune and reasonably requested
                  by BI Austria that may be suitable as a basis for
                  comparison between the GENENTECH PRODUCT and the BI PRODUCT.

         2.1.3.   DATA

                  InterMune shall also provide to BI Austria, as reasonably
                  requested, all technical data and equipment specifications
                  reasonably available to InterMune that are used in the
                  manufacture of the GENENTECH PRODUCT in the US.

         2.1.4.   SUPPORT

                  InterMune shall timely send all documentation, and otherwise
                  timely provide all information and other assistance,
                  reasonably requested by BI Austria for use under this
                  Agreement. InterMune shall provide such reasonable technical
                  support at its own

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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                  expense, which support shall include access to InterMune's
                  expert personnel upon reasonable notice and at such reasonable
                  times as the Parties may agree.

         2.1.5.   CONTACT WITH HEALTH AUTHORITIES

                  2.1.5.1.   InterMune, as the license holder for the
                             GENENTECH PRODUCT in the US, shall have the
                             overall responsibility regarding all contacts
                             with the HEALTH AUTHORITIES and shall be solely
                             responsible for filing all regulatory documents
                             required by any HEALTH AUTHORITIES, such as any
                             amendments to the BLA for the GENENTECH PRODUCT.
                             BI Austria shall support InterMune in all
                             matters regarding the manufacturing and quality
                             control of PRODUCT as reasonably requested by
                             InterMune, but InterMune shall be the leading
                             Party, responsible for co-ordination of all
                             regulatory matters.

                  2.1.5.2.   InterMune will notify BI Austria in due time,
                             but in no event later than five (5) business
                             days in advance of any meeting with any HEALTH
                             AUTHORITIES with regard to manufacture, supply
                             and quality control of the PRODUCT manufactured
                             by BI Austria or BI Pharma KG under this
                             Agreement. BI Austria shall have the right to
                             participate in such meetings with such HEALTH
                             AUTHORITIES during the portion of such meetings
                             relating to BI Austria's or BI Pharma KG's
                             manufacture, supply and quality control of the
                             PRODUCT.

                  2.1.5.3.   BI Austria will be responsible for drawing up
                             the annual report required by the HEALTH
                             AUTHORITIES reasonably in advance of the due
                             date, and will be responsible of matters
                             regarding the manufacture of PRODUCT. InterMune
                             shall submit such report to the HEALTH
                             AUTHORITIES and shall provide BI Austria with a
                             copy of the finally submitted report.

         2.1.6.   SHIPMENT OF MATERIAL BY INTERMUNE

                  All material, e.g. samples, sent by InterMune to BI Austria
                  shall be made by shipment from InterMune's or Genentech's
                  facility to BI Austria's facility in Vienna. Shipping costs
                  including insurance will be borne by InterMune, and risk of
                  loss in transit shall lie with InterMune.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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2.2.     BI AUSTRIA'S TASKS AND RESPONSIBILITIES

         2.2.1.   COMPARISON OF DOCUMENTATION AND MATERIALS

                  2.2.1.1.   BI Austria shall evaluate and compare all
                             documentation and other materials relating to
                             the manufacture and testing of the GENENTECH
                             PRODUCT with all relevant documentation and
                             other materials relating to the manufacture and
                             testing of the BI PRODUCT that is necessary to
                             demonstrate comparability between such Genentech
                             documentation, as listed in EXHIBIT 14, and such
                             BI Austria documentation.

                  2.2.1.2.   BI Austria shall also carry out an analytical
                             comparison of BBS and GENENTECH PRODUCT
                             manufactured by Genentech and of BBS and BI
                             PRODUCT manufactured by BI Austria and BI Pharma
                             KG based on a mutually agreed protocol as listed
                             in EXHIBIT 15.

         2.2.2.   PRODUCTION RUNS

                  Subject to Section 2.2.3, BI Austria shall carry out three (3)
                  production runs of PRODUCT in order to obtain APPROVAL in the
                  US as a cGMP manufacturer of BBS, and to have BI Pharma KG
                  obtain APPROVAL in the US as a cGMP manufacturer of PRODUCT.
                  BBS and PRODUCT derived from these runs shall be used for
                  evidencing comparability between the GENENTECH PRODUCT and the
                  BI PRODUCT. The costs of these runs are listed in EXHIBIT 11
                  and shall be borne by InterMune.

         2.2.3.   ADDITIONAL RUNS

                  If any HEALTH AUTHORITIES request further analytical testing
                  and/or production runs in addition to those described in
                  EXHIBIT 11, BI Austria shall perform such testing and/or
                  production runs as requested by InterMune. The cost of such
                  additional testing and/or production runs will be borne by
                  InterMune, subject to InterMune's prior written approval of
                  such costs, unless the additional analytical testing and/or
                  production runs are due to negligence on BI Austria's or BI
                  Pharma KG's part.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     10 of 66

<PAGE>
         2.2.4.   ADDITIONAL DOCUMENTATION

                  If any HEALTH AUTHORITIES request that InterMune or BI Austria
                  provide, in connection with BI Austria's and/or BI Pharma KG's
                  receipt of approval as a manufacturer of PRODUCT hereunder,
                  further documentation regarding the manufacture of PRODUCT in
                  addition to the documentation as foreseen under the SERVICES
                  (e.g. certain reports), BI Austria will provide such
                  documentation to InterMune for provision to such HEALTH
                  AUTHORITIES as soon as reasonably possible. Such additional
                  documentation may be either (a) product and/or process-related
                  or (b) facility-related (e.g. infrastructure, utilities,
                  personnel, training etc.). The cost of such additional product
                  and/or process-related documentation shall be borne by
                  InterMune unless such additional documentation is due to
                  negligence on BI Austria's or BI Pharma KG's part. The cost of
                  such additional facility-related documentation shall be borne
                  by BI Austria.

         2.2.5.   REGULATORY SUPPORT

                  2.2.5.1.   BI Austria shall provide all site-relevant
                             documentation (both from itself and from BI
                             Pharma KG) and all data relevant for compiling
                             the CMC section necessary for InterMune's
                             drafting of the BLA supplement required by the
                             FDA due to the change of manufacturer for the
                             GENENTECH PRODUCT. BI Austria agrees to
                             co-operate with InterMune in obtaining and
                             maintaining all US governmental approvals and
                             registrations relevant to the CMC section of the
                             registration dossier (and their foreign
                             equivalents) as requested by InterMune.

                  2.2.5.2.   The Parties shall consult with each other
                             concerning the scope and content of all
                             regulatory filings, and shall jointly define the
                             requirements for the necessary PRODUCT
                             registration with the FDA so that BI Austria
                             shall be able to fulfill its obligations under
                             this Agreement with respect to the CMC portion
                             of such PRODUCT registration.

         2.2.6.   FORMAT AND CONTENT OF DOCUMENTS

                  BI Austria's Quality Management System demands a special
                  format for certain documents (i.e. batch records, testing
                  procedures, technical reports) which is binding.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     11 of 66
<PAGE>

                  For those documents where a binding format is not obligatory
                  the Parties shall agree in writing on a master format. With
                  respect to the dates contained in these documents, and in
                  particular in all reports and when dates occur in connection
                  with signatures, the European writing style shall apply. The
                  order shall be as follows: dd / mm / yy (day/month/year).

         2.2.7.   STANDARD OF PERFORMANCE

                  BI Austria shall diligently perform the SERVICES, and shall
                  ensure that BI Pharma KG diligently performs the SERVICES, in
                  a manner consistent with good scientific / regulatory /
                  business practices. InterMune acknowledges that the SERVICES
                  are of biological nature and therefore neither success nor
                  commercial exploitability can be guaranteed by BI Austria.

3.       MANUFACTURE AND SUPPLY

3.1.     GENERAL

         3.1.1.   BI Austria shall exclusively supply to InterMune for use and
                  sale in the TERRITORY, BBS or PRODUCT for use in the treatment
                  or prevention of any human disease or condition except for the
                  treatment or prevention of any type of cardiac or
                  cardiovascular disease or condition. BI Austria shall not
                  supply BBS or PRODUCT for use in the treatment of any human
                  disease or condition, except for the treatment or prevention
                  of any type of cardiac or cardiovascular condition, to any
                  third party for use and/or sale in the TERRITORY without
                  InterMune's prior written consent. InterMune shall exclusively
                  purchase from BI Austria, all of InterMune's clinical trial
                  supply, and from the time BI Austria and BI Pharma KG are
                  approved by the HEALTH AUTHORITIES also its market
                  requirements for PRODUCT in the TERRITORY for the term of
                  this Agreement, subject to Section 3.7.

         3.1.2.   All BBS manufactured by BI Austria hereunder, and all
                  PRODUCT manufactured and supplied to InterMune by BI
                  Austria hereunder, shall be manufactured and supplied in
                  accordance with the BBS SPECIFICATIONS and PRODUCT
                  SPECIFICATIONS, the cGMP requirements, the QUALITY
                  ASSURANCE REQUIREMENTS as listed in EXHIBIT 10 and all
                  applicable laws, regulations and ordinances of the
                  jurisdiction in which such manufacture occurs.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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         3.1.3.   BI Austria shall manufacture BBS according to the BULK
                  SPECIFICATIONS. Until the FILLING SITE CHANGE is complete,
                  BI Austria shall manufacture PRODUCT according to PRODUCT
                  SPECIFICATIONS for clinical supply only. Upon completion of
                  the FILLING SITE CHANGE and upon receipt of FDA APPROVAL of
                  BI Austria's facility as well as BI Pharma KG's facility,
                  BI Austria shall also manufacture PRODUCT for market
                  supply. BBS for clinical and market supply shall be
                  manufactured at BI Austria and transferred to BI Pharma KG
                  for vialing, labeling (but only for market supply) and
                  packaging. Manufacturing and filling of vials, labeling
                  (but only for market supply) as well as the packaging and
                  storing of PRODUCT shall be in accordance with the PRODUCT
                  SPECIFICATIONS, the cGMP requirements, the QUALITY
                  ASSURANCE REQUIREMENTS as listed in EXHIBIT 10 and all
                  applicable laws, regulations and ordinances of the
                  jurisdiction in which such manufacturing and/or filling
                  occurs. Notwithstanding the fact that BI Austria takes BI
                  Pharma KG as a toll manufacturer for filling, labeling (for
                  market supply) and packaging of PRODUCT, BI Austria takes
                  responsibility for the manufacture and supply of PRODUCT to
                  InterMune in accordance with the terms and conditions of
                  this Agreement.

3.2.     FORECASTS

         3.2.1.   [ * ] prior to the first delivery date of PRODUCT for
                  market supply and [ * ] prior to the first delivery date of
                  PRODUCT for clinical supply, unless otherwise agreed,
                  InterMune shall provide a rolling forecast for the next
                  [ * ]. The first [ * ] of such forecast shall be firm
                  (EXHIBIT 16, [ * ]). For [ * ] InterMune can reduce its
                  forecast by [ * ], and may increase its forecast [ * ] will
                  constitute a non-binding forecast [ * ]. After the first
                  forecast has been submitted by InterMune to BI Austria,
                  successive forecasts shall be submitted on a quarterly
                  basis at the latest on every first day of every new
                  calendar quarter. InterMune agrees to order the PRODUCT in
                  filling lot quantities or multiples thereof (available lot
                  sizes are [ * ], or any other then available lot sizes).

         Following BI Austria's and BI Pharma KG's FDA approval to manufacture
         PRODUCT for market supply, InterMune shall order the requested amounts
         of PRODUCT. In any case the [ * ].

         3.2.2.   If InterMune requires more PRODUCT than is set forth in the
                  current firm forecast, BI Austria shall use commercially
                  reasonable efforts in good faith to supply InterMune with

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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                  PRODUCT as requested; PROVIDED THAT for the amounts of
                  PRODUCT in excess of such forecast which BI Austria is
                  unable to supply, despite such commercially reasonable
                  efforts, InterMune may use a secondary source manufacturer
                  in accordance with the procedures set forth in Section 3.7.

         3.2.3.   If InterMune reduces the forecast for [ * ]by an amount in
                  excess of [ * ] percent (net of any increases in actual
                  orders for these [ * ]), then InterMune shall be [ * ]
                  which was [ * ] of the [ * ] at the [ * ] of the [ * ] of
                  the [ * ].

         3.2.4.   Notwithstanding the provisions stated in 3.2.1. for
                  planning purposes at BI Pharma KG InterMune shall provide
                  BI Austria [ * ]prior to the first delivery date of PRODUCT
                  as not agreed otherwise a rolling forecast for the next
                  [ * ] upon completion of the FILLING SITE CHANGE. InterMune
                  will be immediately informed by BI Austria of date of
                  completed FILLING SITE CHANGE. For all further requirements
                  all terms and conditions as stated in 3.2.1. shall apply.

         3.2.5.   In the event that the FDA approval process for the PRODUCT
                  is unexpectedly delayed, and/or the PRODUCT fails to pass
                  clinical trials, InterMune shall have no further ordering
                  and purchase obligations under Sections 3.2.1. and 3.2.3.
                  Only in this event even firm forecasts can be canceled,
                  provided that InterMune shall remain responsible for those
                  reasonable, documented, financial obligations which BI
                  Austria and/or BI Pharma KG have incurred due to (a) the
                  timely allocation of resources for the manufacture of BBS
                  and PRODUCT, (b) equipment for manufacture of BBS / PRODUCT
                  already ordered and not otherwise cancelable, or (c) other
                  non-refundable amounts already expended by BI Austria
                  and/or BI Pharma KG in good faith reliance on the cancelled
                  forecast.

3.3.     PURCHASE ORDERS

         3.3.1.   All purchases of PRODUCT hereunder shall be made pursuant
                  to written purchase orders provided to BI Austria by
                  InterMune. To the extent that the terms of a purchase order
                  or of BI Austria's or BI Pharma KG's "GENERAL CONDITIONS OF
                  SALE" are inconsistent with the terms of this Agreement,
                  this Agreement shall prevail.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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         3.3.2.   BI Austria shall guarantee that at the date of FINAL
                  RELEASE all PRODUCT supplied to InterMune shall have a
                  minimum residual shelf life of not less than [ * ] of
                  PRODUCT shelf life, provided that InterMune shall strictly
                  fulfill its contractual timelines regarding FINAL RELEASE
                  as set forth in Sections 3.5 and 5.3.

         3.3.3.   BI Austria shall ship all PRODUCT as set forth in Section
                  3.4 by the date and in the quantities specified in the
                  applicable purchase order. BI Austria shall be obligated to
                  accept any purchase order within the range of permitted
                  variation in the forecasted quantities as set forth in
                  Section 3.2.1. and 3.2.2. Any other purchase order shall be
                  binding on BI Austria only if it is accepted by BI Austria,
                  which acceptance shall not be unreasonably withheld. If BI
                  Austria does not accept such a purchase order, then
                  InterMune may use a secondary source manufacturer for such
                  purchase order in accordance with the procedures set forth
                  in Section 3.7.

         3.3.4.   InterMune shall be obligated to buy and BI Austria shall be
                  obligated to sell only the quantities of PRODUCT which are
                  subject to a purchase order accepted by BI Austria. Any
                  purchase order (or portion thereof) for which InterMune has
                  not received a written rejection from BI Austria within
                  fifteen (15) business days of BI Austria's receipt of such
                  purchase order shall be deemed accepted by BI Austria.

3.4.     SHIPMENT OF PRODUCT AND MATERIAL BY BI AUSTRIA

         3.4.1.   The PRODUCT and all material (e.g. samples) shall be
                  shipped [ * ] either BI Pharma KG, FRG-88397 Biberach an
                  der Riss, Germany or BI Austria's facility in Vienna,
                  Austria, as the case may be, to InterMune or as directed by
                  InterMune, in accordance with Incoterms 1990 as published
                  by the International Chamber of Commerce. InterMune's
                  designated carrier shall be used to ship PRODUCT to the
                  site designated by InterMune. Risk of loss in transit by
                  InterMune's designated contract carrier shall lie with
                  InterMune, except where such loss is caused by BI Austria's
                  or BI Pharma KG's negligence.

         3.4.2.   BI Austria will provide or will have provided assistance to
                  InterMune regarding necessary procedures for exportation
                  and/or importation of PRODUCT.

3.5.     TESTING AND REJECTION

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     15 of 66
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         3.5.1.   Within [ * ] business days of its receipt of PRODUCT at
                  such destination as may be designated by InterMune,
                  InterMune may perform such tests and samplings as are
                  appropriate to determine whether such PRODUCT meets the
                  applicable PRODUCT SPECIFICATIONS. If InterMune refuses
                  acceptance of PRODUCT, then InterMune shall inform BI
                  Austria in writing within [ * ]further business days of any
                  aspect in which such PRODUCT fails to conform to the
                  PRODUCT SPECIFICATIONS. If BI Austria does not receive such
                  a notice within [ * ] business days of InterMune's receipt
                  of such PRODUCT, then InterMune shall be deemed to have
                  accepted the PRODUCT; provided that InterMune shall have
                  the right to revoke its acceptance of such goods if it
                  later discovers latent defects not reasonably discoverable
                  at the time of receipt.

         3.5.2.   If BI Austria receives a notice from InterMune pursuant to
                  Section 3.5.1 that InterMune does not accept any PRODUCT
                  supplied hereunder, then BI Austria shall immediately start
                  re-testing the PRODUCT using the retained samples in order
                  to evaluate process issues and other reasons for such
                  non-compliance.

         3.5.3.   Regardless of whether BI Austria agrees with InterMune's
                  rejection of such PRODUCT, if requested in writing by
                  InterMune, BI Austria shall use reasonable efforts to
                  promptly replace such allegedly defective PRODUCT, the
                  costs of which shall be borne as set forth in Section 3.5.4.

         3.5.4.   In the event that BI Austria's re-testing does not verify
                  InterMune's reasons for rejecting such PRODUCT, the Parties
                  shall mutually agree on an independent laboratory that
                  shall determine by applying validated product-specific
                  analytical methods whether such PRODUCT meets the PRODUCT
                  SPECIFICATIONS. The conclusions of this independent
                  laboratory shall be binding upon both Parties. If such
                  laboratory determines that such PRODUCT does meet the
                  PRODUCT SPECIFICATIONS, then InterMune shall bear the costs
                  for such independent laboratory and for any replacement
                  PRODUCT manufactured and supplied to InterMune by BI
                  Austria pursuant to Section 3.5.3. If such laboratory
                  determines that such PRODUCT does not meet the PRODUCT
                  SPECIFICATIONS, then BI Austria shall bear the costs for
                  such independent laboratory and for any such replacement of
                  PRODUCT.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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         3.5.5.   Neither Party may destroy any PRODUCT alleged not to meet
                  the PRODUCT Specifications until the independent laboratory
                  determines whether such PRODUCT meets the applicable
                  PRODUCT SPECIFICATIONS and provides written notification to
                  the Parties with respect to such determination, unless BI
                  Austria accepts InterMune's basis for such rejection.
                  Thereafter, BI Austria shall have the obligation to destroy
                  or have destroyed, at its cost, all such rejected PRODUCT.
                  Upon BI Austria's written request and at BI Austria's cost,
                  InterMune shall either destroy or return to BI Austria any
                  rejected PRODUCT. The Parties agree that in the event of
                  destruction of PRODUCT, the method of such destruction
                  shall be in compliance with all applicable laws, rules and
                  regulations.

         3.5.6.   Claims on account of quantity, loss or damages to PRODUCT
                  (other than claims that such PRODUCT does not meet the
                  PRODUCT SPECIFICATIONS and latent defects not reasonably
                  detectable upon inspection) will be dispatched by InterMune
                  in writing within [ * ] business days following receipt
                  thereof. BI Austria shall use reasonable efforts to replace
                  the quantity of goods which such claims apply, which
                  replacement shall be at InterMune's expense unless such
                  claims are due to the negligence of BI Austria.

3.6.     INCREASE OF MANUFACTURING CAPACITY

         3.6.1.   At BI Austria's facility an additional production line is
                  currently under construction. Validation of this separated
                  cGMP fermentation production lines within a completely
                  separated containment is intended to be completed by [ * ]
                  for any reason including but not limited to the amount of
                  BBS to be manufactured, when to have the [ * ].

         3.6.2.   BI Austria guarantees to have manufactured at BI Pharma KG
                  a minimum of [ * ] vials per year. InterMune presumes that
                  the amount of vials requested per year might exceed [ * ]
                  vials. Should it become at any time apparent that a higher
                  PRODUCT demand is necessary InterMune will notify BI
                  Austria thereof. BI Austria shall inform as soon as
                  reasonably possible InterMune of the respective costs for
                  guaranteeing the appropriate reserved capacity for
                  manufacturing the amount exceeding [ * ] vials. Upon
                  agreement on the costs BI Austria shall reserve the
                  capacity needed for the increased demand of PRODUCT.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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                  Should it become at any time apparent that manufacturing
                  capacity at BI Austria for cell paste and BBS equivalent to
                  at least [ * ] vials per year would not be feasible, BI
                  Austria will notify InterMune thereof.

3.7.     SECOND SOURCE MANUFACTURER

         3.7.1.   BI Austria acknowledges that it is critical that InterMune
                  be ensured continuity of supply of PRODUCT for use in
                  clinical trials and market supply. BI Austria shall ensure
                  continuity of supply of PRODUCT for use in clinical trials
                  and market supply. Nevertheless, due to the potentially
                  growing market demand of PRODUCT, BI Austria's ability to
                  manufacture and supply PRODUCT shall be carefully observed.
                  Should at any time BI Austria have any indication that
                  continuity of supply can not be ensured, BI Austria shall
                  immediately inform InterMune thereof in writing. In this
                  event the matter would be immediately forwarded to the
                  STEERING COMMITTEE to discuss second source manufacture of
                  PRODUCT reasonably and in good faith.

         3.7.2.   In the event the STEERING COMMITTEE decides that it is
                  appropriate for InterMune to establish a second source
                  manufacturer, InterMune agrees to provide the first
                  opportunity to qualify as a second source manufacturer for
                  PRODUCT to a BI Austria AFFILIATE. If such an AFFILIATE is
                  - as foreseeable - unable to supply InterMune's PRODUCT
                  requirements then InterMune shall be free to choose an
                  alternate supplier. In this case BI Austria shall assist
                  InterMune in transferring the MANUFACTURING PROCESS to a
                  third party supplier by providing reasonable technical
                  assistance and documentation as necessary for a transfer to
                  a party well skilled in the manufacture of such biotech
                  products at InterMune's cost.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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3.8.     MATERIAL SUPPLY BREACH

         3.8.1.   In the event of a MATERIAL SUPPLY BREACH, InterMune shall
                  provide BI Austria written notification of such MATERIAL
                  SUPPLY BREACH. Upon BI Austria's receipt of such notice and
                  failure to cure such MATERIAL SUPPLY BREACH within the
                  timetable and activity plan agreed upon the Parties to cure
                  such MATERIAL SUPPLY BREACH, InterMune shall have the right
                  to purchase from a second source manufacturer, to be agreed
                  upon within the STEERING COMMITTEE in accordance with
                  Section 3.7, such amounts of PRODUCT as necessary to offset
                  BI Austria's shortfall in fulfilling InterMune's purchase
                  orders for such PRODUCT (or the anticipated shortfall, in
                  the event of repeated (maximum two (2) times) material
                  violation against cGMP).

                  In the event, that

                  i)         a BI Austria AFFILIATE can not qualify as a
                             second source manufacturer for PRODUCT or

                  ii)        in the event such a BI Austria AFFILIATE is - as
                             foreseeable -unable to supply InterMune's
                             PRODUCT requirements and

                  iii)       provided that PRODUCT supply as requested by
                             InterMune by a different second source
                             manufacturer, a company experienced in
                             manufacturing of biopharmaceuticals derived from
                             microbial fermentation technology, and selected
                             by InterMune could demonstrably take place
                             earlier than a MATERIAL SUPPLY BREACH by BI Austria
                             could be remedied, BI Austria shall assist
                             InterMune as requested in transferring the
                             MANUFACTURING PROCESS to such a second source
                             supplier, to be selected by InterMune by providing
                             reasonable technical assistance and documentation
                             relating to the manufacture, testing and supply
                             of BBS and the PRODUCT as necessary at BI Austria's
                             cost. Such second source manufacturer would bear
                             responsibility for putting the MANUFACTURING
                             PROCESS in place. The total financial commitment
                             for reasonable technical assistance shall not
                             exceed the costs equivalent to one (1) FTE
                             (full time equivalent) for the period of
                             six (6) months.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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         3.8.2.   In the event that BI Austria reasonably anticipates that
                  there is a substantial likelihood that a MATERIAL SUPPLY
                  BREACH will occur, BI Austria shall promptly notify
                  InterMune in writing thereof. Upon receipt of such notice,
                  the Parties shall promptly confer to discuss the
                  circumstances and magnitude of such potential MATERIAL
                  SUPPLY BREACH, and to determine in good faith whether there
                  are any reasonable steps that BI Austria could take to
                  avoid such MATERIAL SUPPLY BREACH. If InterMune is not
                  reasonably satisfied that BI Austria will be able to avoid
                  such MATERIAL SUPPLY BREACH, then InterMune shall forward
                  this issue to the STEERING COMMITTEE to determine whether
                  it is necessary or desirable to establish a second source
                  manufacturer in accordance with Section 3.7.

4.       PRICES AND PAYMENT

4.1.     The prices to be paid by InterMune for the SERVICES and PRODUCT
         provided hereunder have been agreed to by the Parties and are listed
         in EXHIBIT 11 and EXHIBIT 17, respectively. The price for the
         SERVICES and PRODUCT will be adjusted year by year in accordance
         with the [ * ]. (By way of example, the [ * ].) All payments
         hereunder shall be made in Austrian Shilling or in Euro. If the
         Austrian Shilling is replaced by the Euro and therefore no longer
         available, payments becoming due thereafter shall be made in Euro
         calculated at the official exchange rate.

4.2.     [ * ] will be [ * ] which are [ * ] at the time such [ * ] to have
         any such [ * ] selected by [ * ] which [ * ] shall [ * ]on
         verification concerning the [ * ] shall provide [ * ] with [ * ]
         days' notice of any [ * ].

4.3.     The price for the SERVICES and purchase price for PRODUCT shall be
         paid to BI Austria no later than [ * ] days after the date that BI
         Austria's invoice is received by InterMune.

         4.3.1.   Payment of the invoice amounts shall be made in Austria,
                  [ * ], into an account with such Austrian credit
                  institution as shall be notified by BI Austria to InterMune
                  from time to time.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     20 of 66

<PAGE>

         4.3.2.   All payments owed to BI Austria by InterMune on the basis of
                  accounts rendered shall be made in such a way that [ * ] shall
                  be [ * ] that are [ * ] on such [ * ]. In the event of a
                  default in payment for whatever reason, default interest at a
                  rate of [ * ] p.a. shall be payable on the outstanding amount
                  due. BI Austria reserves the right to claim any damage
                  exceeding such amount that shall have been caused by such
                  delay, subject to Section 11.1.

4.4.     As security for payment for the SERVICES, InterMune shall deliver to
         BI Austria within twenty (20) business days of the Effective Date an
         abstract Standby Letter of Credit issued by a renowned European credit
         institution with a term starting Feb 1, 2000 until April 30, 2001 in
         the amount of ATS 7,563,800 (seven million five hundred sixty three
         thousand eight hundred Austrian Shillings) which is in accordance with
         a fifth of the payment obligation for the SERVICES as listed in
         EXHIBIT 11. InterMune shall provide such Standby Letter of Credit at
         its own cost. BI Austria shall be entitled to draw upon such Standby
         Letter of Credit to cover any payment obligation arising with respect
         to the SERVICES.

5.       QUALITY ASSURANCE AND COMPLIANCE WITH LAW

5.1.     RELEASE OF PRODUCT

         5.1.1.   BI Austria shall be responsible for the RELEASE of PRODUCT
                  according to the PRODUCT SPECIFICATIONS, the cGMP
                  requirements, the QUALITY ASSURANCE REQUIREMENTS as listed in
                  EXHIBIT 10 and all applicable Austrian and German laws. BI
                  Austria shall certify in writing that each shipment lot of
                  PRODUCT was produced and tested in compliance with (i) the
                  SPECIFICATIONS, (ii) the cGMP requirements (iii) QUALITY
                  ASSURANCE REQUIREMENTS and (iv) all applicable laws,
                  regulations and ordinances of the jurisdiction in which such
                  manufacture occurs.

         5.1.2.   BI Austria shall provide to InterMune, through BI Pharma KG,
                  QUALITY ASSURANCE REQUIREMENTS as listed in EXHIBIT 10
                  including but not limited to a COA and COC signed by the
                  appropriate personnel as defined in BI Austria's Quality
                  Management System for each shipment lot of PRODUCT from BI
                  Pharma KG's manufacture site in Biberach, Germany, in order to
                  prove BI Austria's compliance with the Article 5.1.1.

5.2.     STORAGE OF RECORDS AND BATCH SAMPLES

         5.2.1.   BI Austria shall maintain in compliance with cGMP standards
                  all batch samples and all records required by law or as
                  otherwise mutually agreed in writing by the Parties (i.e.
                  batch records, analytical raw data) necessary to evidence
                  compliance with all its

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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                  obligations under this Agreement and relating to the
                  manufacture of the BBS and of PRODUCT. The documentation
                  concerning manufacture of BBS shall be stored at BI Austria
                  and concerning manufacture of PRODUCT shall be stored in
                  Biberach upon completion of FILLING SITE CHANGE. Storage of
                  retained samples of BBS as well as PRODUCT shall be at BI
                  Austria.

         5.2.2.   Copies of all documentation and information relating to the
                  manufacture, processing, packaging and shipping of PRODUCT
                  and/or required to support InterMune's BLA or other regulatory
                  submissions, including but not limited to information relating
                  to batch records, methods, equipment and the facility, will be
                  provided by BI Austria to InterMune for review and inclusion
                  as necessary in InterMune's regulatory submissions.

         5.2.3.   All such samples and records shall be maintained for a period
                  not less than five (5) years from the date of expiration of
                  each batch of PRODUCT to which such samples and records
                  pertain, or such longer period as may be required by local law
                  and the rules or regulations of the FDA or other applicable
                  HEALTH AUTHORITIES. Following the expiration of such required
                  retention period, prior to the destruction of any such sample
                  or record, BI Austria shall give written notice thereof to
                  InterMune, and InterMune shall have the right to request,
                  receive and retain such samples and records with no further
                  compensation to BI Austria.

5.3.     FINAL RELEASE

         FINAL RELEASE of PRODUCT supplied by BI Austria and/or BI Pharma KG
         hereunder for use in humans shall solely be made by and under the
         responsibility of InterMune.

5.4.     THIRD PARTY SERVICES

         Except as specifically provided for herein, BI Austria will not
         contract out to any third party any part of the SERVICES or the
         manufacture and testing of BBS or PRODUCT, without prior written
         approval from InterMune, which shall not be unreasonably withheld.

5.5.     CONSENT TO CHANGES

         BI Austria will not make any changes to BI Austria's, and shall ensure
         that BI Pharma KG shall not make any changes to BI Pharma KG's,
         respective manufacturing facilities, equipment,

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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                  testing procedures, validation, suppliers of raw materials and
                  components or documentation systems that are solely related to
                  the PRODUCT and having a non-trivial impact on the PRODUCT,
                  without the prior written consent of InterMune and solely as
                  is permitted by cGMP. In the event that a supplier of raw
                  material is unable to deliver the respective raw material in
                  time for scheduled manufacturing BI Austria is free to choose
                  another supplier, provided that such supplier supplies such
                  raw material that fully meets the respective raw material
                  specification, and subject to BI Austria's providing InterMune
                  prior written notice thereof.

5.6.     INSPECTIONS BY HEALTH AUTHORITIES

         5.6.1.   BI Austria shall secure that during APPROVAL inspections at BI
                  Austria's and/or BI Pharma KG's facilities by any applicable
                  HEALTH AUTHORITIES, BI Austria shall give InterMune prior
                  written notice thereof promptly following BI Austria's receipt
                  of notice of such inspection, so that representatives of
                  InterMune may attend and participate in such inspections, for
                  example, to answer PRODUCT and clinical trial related
                  questions.

         5.6.2.   BI Austria shall advise, and shall ensure that BI Pharma KG
                  shall advise, InterMune in writing immediately of any requests
                  by any applicable HEALTH AUTHORITIES for inspections at either
                  of BI Austria's or BI Pharma KG's facilities, but in any
                  event, no later than ten (10) business days prior to the
                  scheduled date of such inspection. Upon reasonable notice,
                  InterMune or its representatives may attend only such portions
                  of such inspections or audits that deal with PRODUCT related
                  issues, due to BI Austria's other secrecy obligations. Access
                  to such facilities may be subject to reasonable restrictions
                  customarily placed upon visitors to the site.

         5.6.3.   BI Austria also agrees to notify InterMune within four (4)
                  business days of any written or oral inquiries, notifications,
                  or inspection activity by any HEALTH AUTHORITIES (or any third
                  party authorized by the HEALTH AUTHORITIES) in regard to
                  PRODUCT. BI Austria shall provide a reasonable description to
                  InterMune of any such inquiries, notifications or inspections
                  promptly (but in no event later than ten (10) business days)
                  after such visit or inquiry. BI Austria shall furnish to
                  InterMune (a) within four (4) business days after receipt, any
                  report or correspondence issued by the HEALTH AUTHORITIES (or
                  a third party authorized by a HEALTH AUTHORITIES)

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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                  in connection with such visit or inquiry, including but not
                  limited to, any FDA Form 483 (List of Inspectional
                  Observations) or warning letter, and (b) not later than five
                  (5) business days prior to the time it provides to a HEALTH
                  AUTHORITY, copies of any and all proposed written responses or
                  explanations relating to items set forth above (each, a
                  "Proposed Response"), in each case purged only of trade
                  secrets or other confidential or proprietary information of BI
                  Austria that are unrelated to its obligations under this
                  Agreement or are unrelated to PRODUCT. BI Austria shall
                  discuss with InterMune any comments provided by InterMune on
                  the Proposed Response; provided that InterMune shall have the
                  final decision with respect to those portions of the final
                  written response or explanation to be provided to the HEALTH
                  AUTHORITIES that relate to PRODUCT manufactured hereunder.
                  After the filing of a response with the appropriate HEALTH
                  AUTHORITIES, BI Austria will notify InterMune of any further
                  contacts with the HEALTH AUTHORITIES relating to BI Austria's
                  manufacture of PRODUCT hereunder.

         5.6.4.   BI Austria shall promptly correct, and shall ensure that BI
                  Pharma KG shall promptly correct, any facility-related
                  violations or deficiencies promptly at its own expense.
                  Equipment, system and process-related violations or
                  deficiencies that are solely PRODUCT-related shall be
                  corrected promptly by BI Austria or BI Pharma KG,
                  respectively, at InterMune's cost.

                  In the event such corrections will not only be necessary for
                  PRODUCT but as well for BI PRODUCT the appropriate allocation
                  of the related costs between the Parties shall be determined
                  by the PROJECT TEAM.

5.7.     AUDITS BY INTERMUNE

         5.7.1.   InterMune shall have the right to inspect and audit both of BI
                  Austria's and BI Pharma KG's manufacturing facilities and
                  records for regulatory compliance. These audits shall occur
                  annually upon reasonable notice, and more frequently for good
                  and reasonable cause. BI Austria shall respond in writing to
                  InterMune regarding any items of non-compliance with cGMP
                  identified by InterMune during such audits, whether with
                  respect to the BI Austria or the BI Pharma KG facility, within
                  [ * ] business days of InterMune's

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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                  notice thereof, and without delay remedy any such agreed upon
                  items of non-compliance with cGMP.

         5.7.2.   If BI Austria can not remedy such non-compliance, whether with
                  respect to the BI Austria or the BI Pharma KG facility, within
                  [ * ] business days of notice thereof BI Austria's response
                  shall include a written plan and timetable including
                  reasonable timelines. Considering the fact that BI Austria is
                  dependent on certain third parties to supply services to it,
                  BI Austria shall use best efforts to assign such timelines to
                  these third parties accordingly in order to meet all timelines
                  for such remedy. Such plan and timetable shall be subject to
                  InterMune's approval, which shall not unreasonably be
                  withheld. In the event that BI Austria does not respond with a
                  plan and timetable as described above within such [ * ] day
                  period, or InterMune does not approve such proposed plan and
                  timetable for good reason, the issue shall be forwarded to the
                  STEERING COMMITTEE for resolution. In the event InterMune
                  approves such plan and timetable, but BI Austria fails to
                  remedy such non-compliance in accordance with such plan and
                  timetable, then InterMune shall have the right to terminate
                  this Agreement pursuant to Section 13.2.1.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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5.8.     MANUFACTURING FACILITIES

         BI Austria represents and warrants that it and BI Pharma KG shall
         obtain all relevant APPROVALS required by the relevant HEALTH
         AUTHORITIES for each of their respective manufacturing facilities and
         that each of their respective manufacturing facilities conform, and
         will during the term of this Agreement conform, to the cGMP.

5.9.     COMPLIANCE WITH LAW

         5.9.1.   BI Austria shall comply, and shall ensure that its
                  subcontractor BI Pharma KG shall comply with, all local
                  applicable rules, laws and regulations (including without
                  limitation cGMP) in performing its obligations under this
                  Agreement. InterMune shall comply with all applicable rules,
                  laws and regulations in performing its obligations under this
                  Agreement.

         5.9.2.   All costs in connection with maintaining BI Austria's and BI
                  Pharma KG's compliance with all applicable local regulatory
                  requirements and cGMP in performing under this Agreement,
                  including but not limited to the maintenance and upgrading of
                  all technical facilities and infrastructure and the training
                  of personnel, shall be borne by BI Austria. BI Austria shall
                  obtain and maintain, and shall ensure that BI Pharma KG
                  obtains and maintains, all permits and licenses necessary to
                  its performance under this Agreement at their own expense. All
                  costs resulting out of the SERVICES carried out at BI Austria
                  or BI Pharma KG, respectively, related to compliance with
                  regulatory requirements that were not in effect as of the
                  Effective Date concerning equipment and systems solely
                  PRODUCT-related shall be at InterMune's expense.

5.10.    ENVIRONMENTAL

         BI Austria shall, and shall ensure that BI Pharma KG shall, properly
         dispose of any and all hazardous waste materials involved with the
         manufacture of BBS and PRODUCT that are generated or resulting from the
         activities performed hereunder, if any, in full compliance with all
         applicable local laws and regulations at BI Austria's sole liability
         and expense.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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6.       CO-OPERATION AND CO-ORDINATION BETWEEN THE PARTIES

6.1.     PROJECT TEAM

         6.1.1.   The day-to-day responsibilities of the Parties with respect to
                  the SERVICES shall be overseen by the PROJECT TEAM, which
                  shall be responsible for deciding operational and scientific
                  issues arising out of the SERVICES and unanimously agreeing in
                  good faith with respect to the monitoring of the SERVICES.

         6.1.2.   The PROJECT TEAM shall consist of a team consisting of equal
                  numbers of people, if feasible, each appointed by InterMune
                  and BI Austria and notified to the other, which appointees may
                  be changed from time to time by the appointing Party on
                  written notice to the other Party. Each member of the PROJECT
                  TEAM shall be a person of appropriate skill and experience.
                  Either Party may change its own designated PROJECT TEAM
                  members provided, however that the total number of members of
                  the PROJECT TEAM may not be changed if feasible, nor the
                  number of members representing InterMune decreased, without
                  the Parties' prior written agreement. InterMune's and BI
                  Austria's respective members of the PROJECT TEAM as of the
                  Effective Date are listed in EXHIBIT 8.

         6.1.3.   During the term of this Agreement, the PROJECT TEAM shall meet
                  regularly to communicate updates and provide a forum for
                  decision-making and rapid resolution of issues arising under
                  this Agreement. Meetings of the PROJECT TEAM may be conducted
                  by telephone conference, videoconference or face-to-face
                  meetings as agreed by the PROJECT TEAM, provided that the
                  PROJECT TEAM shall meet at least once a year in a face-to-face
                  meeting at a mutually agreed location.

         6.1.4.   Decisions of the PROJECT TEAM shall be reflected in the
                  approved minutes. Meeting minutes shall be prepared jointly by
                  the PROJECT MANAGERS to record all issues discussed and
                  decisions. Minutes that have not been objected to in writing
                  by a Party within six (6) business days of receipt thereof
                  shall be deemed approved by such Party and followed by
                  issuance of two (2) copies of the minutes duly executed by the
                  Parties' PROJECT MANAGER.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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         6.1.5.   In the event that the PROJECT TEAM is unable to reach
                  agreement on any issue and is unable to make decisions arising
                  out of operational and scientific issues within ten (10)
                  business days, each Party may call in an expert of its own
                  choice to render advice to the PROJECT TEAM. Based on the
                  advice of such expert(s) and the team members' know-how, the
                  PROJECT TEAM will try to resolve such issue. In the event that
                  the PROJECT TEAM fails to reach agreement on an issue within
                  thirty (30) business days of first undertaking resolution of
                  such issue, such issue shall then be referred to the STEERING
                  COMMITTEE for immediate resolution.

6.2.     STEERING COMMITTEE

         6.2.1.   The Parties shall create a STEERING COMMITTEE consisting of
                  the PROJECT MANAGER of each Party and authorized
                  representatives who shall be appointed by InterMune and by BI
                  Austria in equal numbers, if feasible, and notified to the
                  other Party. The STEERING COMMITTEE shall be responsible for
                  unanimously agreeing in good faith all issues on which the
                  PROJECT TEAM has been unable to reach agreement and, where
                  possible, make decisions arising out of such issues as well as
                  carry out the specific functions, including but not limited to
                  decisions with an impact on costs and timelines of the
                  SERVICES to be carried out under this Agreement. Each Party
                  may change its own designated STEERING COMMITTEE members by
                  providing written notice thereof to the other Party; provided,
                  however that the total number of members of the STEERING
                  COMMITTEE may not be changed, if feasible, nor the number of
                  members representing InterMune decreased, without the Parties'
                  prior written agreement. The members of the STEERING COMMITTEE
                  are listed in EXHIBIT 13.

         6.2.2.   The STEERING COMMITTEE shall attempt in good faith to
                  expeditiously and fairly resolve all issues before it. In the
                  event that the STEERING COMMITTEE is unable to resolve any
                  issue before it within fifteen (15) business days from the
                  date that such issue is referred to it, such issue shall be
                  referred to the Chief Executive Officer of InterMune and the
                  Chief Executive Officer of BI Austria for prompt, good faith
                  resolution. If such individuals do not reach agreement on such
                  issue within fifteen (15) days of such referral, then each
                  Party shall be free to pursue all available legal and/or
                  equitable remedies.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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6.3.     LIMITATION OF POWERS

         The powers of the PROJECT TEAM and the STEERING COMMITTEE are limited
         to those expressly set forth in this Agreement. Without limiting the
         generality of the foregoing, neither the PROJECT TEAM nor the STEERING
         COMMITTEE shall have the right to amend this Agreement. The actions of
         the PROJECT TEAM and/or the STEERING COMMITTEE shall not substitute for
         either Party's ability to exercise any right, nor excuse the
         performance of any obligation, set forth herein.

7.       INTELLECTUAL PROPERTY AND LICENSES

7.1.     The ownership of INTERMUNE'S TECHNOLOGY shall remain with InterMune
         and shall not vest in BI Austria.

7.2.     The ownership of BI AUSTRIA'S TECHNOLOGY shall remain with BI Austria
         and shall not vest in InterMune.

7.3.     BI Austria shall retain ownership of BI AUSTRIA'S IMPROVEMENTS. BI
         Austria hereby grants to InterMune a non-exclusive, perpetual,
         sublicenseable, royalty-free license under BI AUSTRIA'S IMPROVEMENTS to
         develop, use, make, have made, import, offer for sale and sell products
         containing INTERFERON GAMMA 1b in the TERRITORY, whereby InterMune
         shall assume the costs to be paid by BI Austria for awards to inventors
         of BI AUSTRIA'S IMPROVEMENTS, as such awards are set forth in written
         agreements between BI Austria and such inventor or in an applicable
         industry labor contract.

7.4.     The Parties shall each have an undivided one-half ownership interest in
         any INFORMATION jointly conceived of or reduced to practice by the
         Parties pursuant to this Agreement ("JOINT INFORMATION"). InterMune
         shall [ * ] of any JOINT INFORMATION that comprises (a) any regulatory
         filing (or documentation and raw data relating thereto) relating to
         PRODUCT manufactured hereunder, or (b) any manufacturing documentation
         (including without limitation batch records) relating to PRODUCT
         manufactured hereunder ("PRODUCT INFORMATION"). Upon request by
         InterMune, without additional consideration, BI Austria agrees to
         promptly execute documents, testify and take other acts at InterMune's
         expense as

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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         InterMune may deem necessary or desirable to procure, maintain,
         perfect, and enforce the full benefits, enjoyment, rights, title and
         interest of the PRODUCT INFORMATION, on a worldwide basis. In the event
         InterMune is unable for any reason, after reasonable effort, to secure
         BI Austria's signature on any document needed in connection with the
         actions specified in this Section 7.4, BI Austria hereby irrevocably
         designates and appoints InterMune and its duly authorized officers and
         agents as its agent and attorney in fact, which appointment is coupled
         with an interest, to act for and in its behalf to execute, verify and
         file any such documents and to do all other lawfully permitted acts to
         further the purposes of this Section 7.4 with the same legal force and
         effect as if executed by BI Austria.

7.5.     InterMune hereby grants to BI Austria (with the right to sublicense
         solely to BI Pharma KG) a non-exclusive, nontransferable license to use
         INTERMUNE'S TECHNOLOGY solely for the purpose of (a) comparison of
         PRODUCT documentation and comparison of BBS and PRODUCT and (b)
         manufacturing PRODUCT for InterMune, as provided in this Agreement. The
         license granted under this Section shall automatically terminate upon
         the expiration or termination of this Agreement.

7.6.     NEW INDICATIONS

         7.6.1.   In the event that InterMune receives approval in the TERRITORY
                  to commercially sell PRODUCT for indications other than
                  Chronic Granulomatous Disease, and provided that InterMune has
                  the right to grant a license to BII in the BI TERRITORY to
                  make, use and sell PRODUCT for such additional indications (a
                  "NEW INDICATIONS LICENSE"), InterMune shall provide BII
                  written notice thereof.

         7.6.2.   BII shall notify InterMune in writing within thirty (30) days
                  of InterMune's notice (the "NOTIFICATION PERIOD") whether BII
                  desires to obtain a NEW INDICATIONS LICENSE. If InterMune does
                  not receive written notice from BII during the NOTIFICATION
                  PERIOD that BII desires to obtain a NEW INDICATIONS LICENSE,
                  then InterMune shall have no further obligations under this
                  Section 7.6. If InterMune does receive written notice from BII
                  that BII desires to obtain a NEW INDICATIONS LICENSE, then BII
                  and InterMune shall engage in good faith negotiations for
                  sixty (60) business days thereafter regarding the reasonable
                  commercial terms upon which InterMune would be willing to
                  grant such a license. If at the end of such sixty (60)

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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<PAGE>

                  business day period, BII and InterMune have not entered into a
                  written agreement under which InterMune grants a NEW
                  INDICATIONS LICENSE to BII, then InterMune shall have no
                  further obligation under this Section 7.6.

8.       COMPLAINTS; ADVERSE EVENTS; RECALLS

8.1.     InterMune shall inform BI Austria of any complaints, adverse
         reaction reports, safety issues or toxicity issues relating to any
         PRODUCT of which it becomes aware, regardless of the origin of such
         information, within the time frame required by cGMP but in no event
         later than two (2) days from the initial complaint or report.

         8.1.1.   InterMune shall retain and manage complaints in accordance
                  with cGMP. The Parties hereby agree to cooperate with one
                  another and with any HEALTH AUTHORITY in the evaluation and
                  investigation of any complaint, claim or adverse reaction
                  report related to the manufacture of such PRODUCT with the
                  intention of complying with cGMP.

         8.1.2.   If any such event occurs, BI Austria shall retain any unused
                  supplies of such PRODUCT and its associated components, and
                  all associated batch and other production records in such
                  manner as InterMune may reasonably direct, and at InterMune's
                  expense, except to the extent such event is caused by BI
                  Austria's wrongful act or omission. BI Austria agrees to
                  respond to InterMune in respect to such complaint
                  investigations involving BI Austria's manufacturing of a
                  PRODUCT or SERVICES rendered hereunder as soon as reasonably
                  possible but in any case within thirty (30) days from receipt
                  by BI Austria of the report of such complaint and sample (if
                  available), or in the case of a serious adverse event, within
                  ten (10) days from receipt of the report of such complaint and
                  sample (if available). InterMune and/or its designee shall
                  serve as the sole point of contact with the FDA or other
                  applicable HEALTH AUTHORITY concerning any complaints, adverse
                  reaction reports, safety issues or toxicity issues with
                  respect to PRODUCT.

8.2.     If either Party becomes aware at any time of any defect or the
         possibility of any defect associated with any PRODUCT manufactured by
         BI Austria hereunder, such Party will notify the other Party
         immediately and confirm the notification as soon as possible in
         writing.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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8.3.     InterMune shall notify BI Austria promptly if any PRODUCT manufactured
         by BI Austria hereunder is the subject of a recall, market withdrawal
         or correction, and InterMune and/or its designee shall have the sole
         responsibility for the handling and disposition of such recall, market
         withdrawal or correction. In the event that a recall is required in
         connection with BI Austria's breach of any of its warranties set forth
         in Section 10.2 hereof, BI Austria shall reimburse InterMune for the
         purchase price of such PRODUCT and all other reasonable costs and
         expenses associated with such PRODUCT recall, market withdrawal or
         correction, but only to the extent that the foregoing costs and
         expenses are attributable to BI Austria's breach of its warranties
         hereunder. In all other events of a recall, all costs and expenses
         incurred in connection with such PRODUCT recall shall be borne by
         InterMune. InterMune and/or its designee shall serve as the sole point
         of contact with the FDA or other applicable HEALTH AUTHORITY concerning
         any recall, market withdrawal or correction with respect to the
         PRODUCT.

8.4.     INSURANCE

         During the term of this Agreement, the Parties shall maintain product
         liability insurance in such amounts and with such scope of coverage as
         are adequate to cover the Parties' obligations under this Agreement
         and as appropriate for companies of like size, taking into account the
         scope of activities contemplated herein. Notwithstanding the foregoing
         the Parties shall maintain minimum limits of liability of [ * ] US$
         per occurrence and in the aggregate annually. The Parties shall
         provide to each other within ten (10) business days of execution of
         this Agreement and thereafter, once a year upon the other Party's
         request, a certificate of insurance evidencing the respective Party's
         product liability insurance. In addition to the foregoing coverage,
         the Parties shall maintain Comprehensive General Liability Insurance
         for limits of not less than [ * ] US$ combined single limit for bodily
         injury and broad form property damage.

9.       REPRESENTATIONS AND WARRANTIES

9.1.     Each Party hereby represents and warrants to the other Party that: (a)
         the person executing this Agreement is authorized to execute this
         Agreement; (b) this Agreement is legal and valid and the obligations
         binding upon such Party are enforceable by their terms; and (c) the
         execution, delivery and performance of this Agreement does not
         conflict with any agreement, instrument

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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<PAGE>

         or understanding, oral or written, to which such Party may be bound,
         nor violate any law or regulation of any court, governmental body or
         administrative or other agency having jurisdiction over it.

9.2.     BI Austria represents and warrants that:

         9.2.1.   All BBS manufactured hereunder shall conform to BULK
                  SPECIFICATIONS;

         9.2.2.   All PRODUCT manufactured and supplied hereunder shall - at the
                  date of shipment - conform to the PRODUCT SPECIFICATIONS;

         9.2.3.   All BBS and PRODUCT manufactured and supplied hereunder shall
                  be manufactured in accordance with the MANUFACTURING PROCESS;

         9.2.4.   All BBS and PRODUCT manufactured hereunder shall be
                  manufactured, handled, stored, labeled, packaged and
                  transported (from BI Austria to BI Pharma KG) in accordance
                  with the cGMP requirements, the QUALITY ASSURANCE REQUIREMENTS
                  as listed in EXHIBIT 10 and all applicable laws, regulations
                  and ordinances of the jurisdiction in which such manufacture
                  occurs.

         9.2.5.   No PRODUCT manufactured and supplied to InterMune hereunder
                  shall be (i) adulterated or misbranded by BI Austria within
                  the meaning of the FD&C Act, or (ii) an article that may not
                  be introduced into interstate commerce under the provisions of
                  Sections 404 or 505 of the FD&C Act; and

         9.2.6.   BI Austria shall not use and shall secure that BI Pharma KG
                  shall not use in any capacity the services of any persons
                  debarred under 21 U.S.C. sections 335 (a) and 335 (b) in
                  connection with the manufacture of the PRODUCT under this
                  Agreement.

9.3.     BI Austria represents and warrants that it has in place, and that BI
         Pharma KG has in place, a program designed to ensure that each will be
         Year 2000 Compliant (as defined below) or that its failure to be Year
         2000 Compliant will not materially affect its performance under this
         Agreement. For purposes of this Section, "Year 2000 Compliant" means
         that the computer systems used in connection with the performance of
         work under this Agreement shall operate and function without (i) any
         failure of such computer systems properly to record, store, process,
         calculate or present calendar dates falling after (and if applicable,
         spans of time including)

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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         January 1, 2000 as a result of the occurrence, or use of data
         consisting of, such dates; (ii) any failure of such computer systems to
         calculate any information dependent on or relating to dates after
         January 1, 2000 in the same manner, and with the same functionality,
         data integrity and performance, as such computer system records,
         stores, processes, calculates and presents calendar dates on or before
         December 31, 1999, or information dependent on or relating to such
         dates; or (iii) any loss of functionality or performance with respect
         to the introduction of records or processing of data containing dates
         falling after January 1, 2000. Upon Effective Date of this Agreement BI
         Austria and BI Pharma KG have not observed any Year 2000 incompliance.

9.4.     Except as expressly provided for herein, BI Austria makes no further
         warranties of the merchantability or fitness of the PRODUCT or any
         warranties of any other nature, express or implied.

10.      INDEMNIFICATION

10.1.    Subject to Section 10.3., BI Austria shall indemnify, defend and hold
         harmless InterMune and its officers, directors, employees and agents
         from and against all third party costs, claims, (including death and
         bodily injury) suits, expenses (including reasonable attorneys' fees),
         liabilities and damages (collectively, "LIABILITIES") arising out of
         or resulting from any willful or negligent act or omission by BI
         Austria or BI Pharma KG relating to the subject matter of this
         Agreement, or any defect in the manufacture or any failure to deliver
         PRODUCT in accordance with BI Austria's warranties (except to the
         extent such LIABILITIES arose or resulted from any negligent act or
         omission by InterMune).

10.2.    Subject to Section 10.3, InterMune shall indemnify, defend and hold
         harmless BI Austria and its officers, directors, employees and agents
         from and against all LIABILITIES arising out of or resulting from any
         willful or negligent act or omission by InterMune relating to the
         subject matter of this Agreement, or the use by or administration to
         any person of a PRODUCT that arises out of this Agreement (except to
         the extent such LIABILITIES arose or resulted from any negligent act
         or omission by BI Austria or BI Pharma KG or any defect in the
         manufacture of PRODUCT or any failure to deliver PRODUCT in accordance
         with BI Austria's warranties).

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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10.3.    A Party and its directors, officers, employees and agents which intends
         to claim indemnification under this Article 10 (each, an "INDEMNITEE")
         shall promptly notify the other Party (the "INDEMNITOR") in writing of
         any action, claim or other matter in respect of which the INDEMNITEE
         intend to claim such indemnification; PROVIDED, HOWEVER, that the
         failure to provide such notice within a reasonable period of time shall
         not relieve the INDEMNITOR of any of its obligations hereunder except
         to the extent that the INDEMNITOR is prejudiced by such failure. The
         INDEMNITEE shall permit the INDEMNITOR at its discretion to settle any
         such action, claim or other matter, and the INDEMNITEE agrees to the
         complete control of such defense or settlement by the INDEMNITOR.
         Notwithstanding the foregoing, the INDEMNITOR shall not enter into any
         settlement that would adversely affect the INDEMNITEE's rights
         hereunder, or impose any obligations on the INDEMNITEE in addition to
         those set forth herein in order for it to exercise such rights, without
         INDEMNITEE's prior written consent, which shall not be unreasonably
         withheld or delayed. No such action, claim or other matter shall be
         settled without the prior written consent of the INDEMNITOR, which
         shall not be unreasonably withheld or delayed. The INDEMNITOR shall not
         be responsible for any attorneys' fees or other costs incurred other
         than as provided herein. The INDEMNITEE shall cooperate fully with the
         INDEMNITOR and its legal representatives in the investigation and
         defense of any action, claim or other matter covered by the
         indemnification obligations of this Article 10. The INDEMNITEE shall
         have the right, but not the obligation, to be represented in such
         defense by counsel of its own selection and at its own expense.

11.      LIMITATIONS ON LIABILITY

11.1.    Except with respect to each Party's indemnification obligations under
         Article 10, in no event shall either Party be liable to the other
         Party for any consequential, incidental, special or indirect damages
         arising in connection with this Agreement.

11.2.    Except with respect to BI Austria's indemnification obligations under
         Article 10, BI Austria 's total liability under this Agreement shall
         not to exceed the total amounts paid to BI Austria by InterMune under
         this Agreement.

12.      CONFIDENTIALITY

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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12.1.    Each Party shall treat confidentially all CONFIDENTIAL INFORMATION of
         the other Party, and shall not use or disclose such CONFIDENTIAL
         INFORMATION other than it is expressly permitted under this Agreement.
         Each Party will take steps to protect the other Party's CONFIDENTIAL
         INFORMATION that are at least as stringent as the steps such Party
         uses to protect its own CONFIDENTIAL INFORMATION, but in no event
         shall be less than reasonable. Each Party may disclose the other
         Party's CONFIDENTIAL INFORMATION to employees, contractors and agents
         who are bound by written obligations of confidentiality and non-use
         consistent with those set forth in this Agreement.

12.2.    Each Party may disclose Confidential Information of the other Party
         hereunder to the extent that such disclosure is reasonably necessary
         for prosecuting or defending litigation, complying with applicable
         government regulations, conducting preclinical or clinical trials or
         obtaining marketing approval for the PRODUCT, provided that if a Party
         is required by law or regulation to make any such disclosure of the
         other Party's CONFIDENTIAL INFORMATION it will, except where
         impracticable for necessary disclosures, for example in the event of
         medical emergency, give reasonable advance notice to the other Party of
         such disclosure requirement and will use its best efforts assist such
         other Party to secure a protective order or confidential treatment of
         such CONFIDENTIAL INFORMATION required to be disclosed.

12.3.    Neither Party shall disclose CONFIDENTIAL INFORMATION of the other
         Party in any patent filings without the prior written consent of such
         other Party.

12.4.    The Parties agree that, except as may otherwise be required by
         applicable laws, regulations, rules, or orders, including without
         limitation the rules and regulations promulgated by the US Securities
         and Exchange Commission, and except as may be authorized in Section
         12.2, no material information concerning this Agreement and the
         transactions contemplated herein shall be made public by either Party
         without the prior written consent of the other. The Parties agree that
         the public announcement of the execution of this Agreement shall be by
         one or more press releases mutually agreed to by the Parties. A failure
         of a Party to return a draft of a press release with its proposed
         amendments or modifications to such press release to the other Party
         within five (5) business days of such Party's receipt of such press
         release shall be deemed as such Party's approval of such press release
         as received by such Party. Each Party agrees that it shall cooperate
         fully and in a timely manner with the other with respect to all
         disclosures to the Securities and Exchange Commission and any other
         governmental and regulatory agencies,

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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         including requests for confidential treatment of CONFIDENTIAL
         INFORMATION of either Party included in any such disclosure.

12.5.    This confidentiality obligations of this Article 12 shall survive the
         termination or expiration of this Agreement for a period of five (5)
         years.

13.      DURATION AND TERMINATION

13.1.    DURATION

         This Agreement shall be effective as of the Effective Date and shall
         continue in force until December 31, 2006. This Agreement shall
         automatically renew for successive four (4) year periods, provided,
         however, that either Party may elect not to renew this Agreement by
         providing the other Party written notice of such election at least
         eighteen (18) months prior to the date of expiration of the
         then-current term.

13.2.    EARLY TERMINATION

         13.2.1.  In the event that a Party materially breaches its obligations
                  under this Agreement (including without limitation a MATERIAL
                  SUPPLY BREACH), the non-breaching Party may terminate this
                  Agreement upon thirty (30) days prior written notice to the
                  breaching Party, unless the breaching Party cures such breach
                  to the non-breaching Party's reasonable satisfaction during
                  such thirty day period. Notwithstanding the preceding
                  sentence, in the event that a Party materially breaches its
                  obligations under this Agreement more than two (2) times in
                  any consecutive twenty-four (24) month period, the
                  non-breaching Party may terminate this Agreement immediately
                  without providing the breaching Party an opportunity to cure
                  such breach, by giving the breaching Party written notice
                  thereof.

         13.2.2.  Each Party may terminate this Agreement by notice in writing
                  to the other Party, for cause, if such other Party is
                  adjudicated to be insolvent or files a petition in bankruptcy.

         13.2.3.  InterMune may immediately terminate this Agreement by notice
                  in writing if InterMune should be prevented by the HEALTH
                  AUTHORITIES from using PRODUCT in clinical

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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                  trials or from distributing PRODUCT on the market. In such
                  event, InterMune shall be liable to BI Austria for the
                  reasonable, non-cancelable costs which BI Austria has already
                  incurred in fulfilling any firm order from InterMune (e.g.
                  costs in connection with manufacture of intermediate products
                  like inactivated cell paste, BBS and PRODUCT) that are not
                  otherwise recoverable by BI Austria through the manufacture of
                  INTERFERON GAMMA 1b for its own use; provided that InterMune
                  shall have no liability to BI Austria under this Section
                  13.2.3 in the event that such HEALTH AUTHORITY action is
                  solely due to any breach of BI Austria's warranties under this
                  Agreement or any negligence or willful misconduct by BI
                  Austria or BI Pharma KG.

         13.2.4.  Either Party may terminate this Agreement upon twelve (12)
                  months written notice in the event that the other Party
                  assigns this Agreement pursuant to Section 14.3.

         13.2.5.  All payments in connection with early termination shall be
                  due within thirty (30) days after receipt by BI Austria of
                  the notice of early termination from InterMune and receipt
                  by InterMune of the respective invoice from BI Austria.

13.3.    EFFECT OF TERMINATION

         13.3.1.  In the event of any termination of this Agreement (other than
                  for BI Austria's material breach):

                  13.3.1.1. InterMune agrees to purchase, and BI Austria agrees
                           to sell, any PRODUCT manufactured by BI Austria and
                           held by BI Austria against the requirements of a
                           binding purchase order on the effective date of
                           termination at the applicable purchase price, subject
                           to InterMune's acceptance of such PRODUCT pursuant to
                           Section 3.5.

                  13.3.1.2. At the request of InterMune, BI Austria shall
                           fulfill any outstanding binding purchase orders for
                           PRODUCT using, at BI Austria's option, materials on
                           hand or on order by BI Austria for such purchase
                           order, in accordance with the terms of this
                           Agreement. In such event, such PRODUCT shall be
                           purchased by InterMune at the applicable purchase
                           price, subject to InterMune's acceptance of such
                           PRODUCT pursuant to Section 3.5. Alternatively,
                           InterMune agrees to purchase any raw materials and
                           components which have been ordered by BI

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

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                           Austria pursuant to a non-cancelable purchase order
                           and unutilized for such purchase order, at cost only
                           if they can not be used by BI Austria otherwise.

         13.3.2.  In the event of any termination or expiration of this
                  Agreement, at the request of InterMune, BI Austria shall
                  either (i) destroy all material, including but not limited to
                  samples and all documentation received from InterMune under
                  this Agreement, or (ii) deliver the same to InterMune or a
                  party nominated by InterMune, at InterMune's cost (except in
                  the case of termination by InterMune for BI Austria's material
                  breach, in which case such destruction or delivery shall be at
                  BI Austria's expense).

         13.3.3.  BI Austria shall promptly return all of InterMune's
                  CONFIDENTIAL INFORMATION to InterMune, except for a single
                  copy and/or sample of each item for documentation purposes
                  only. BI Austria's responsibility to keep and store all other
                  materials provided by InterMune in the course of this
                  Agreement shall terminate six (6) months after expiration or
                  termination of this Agreement (except as otherwise provided in
                  Section 5.2).

         13.3.4.  InterMune shall promptly return all of BI Austria's
                  CONFIDENTIAL INFORMATION to BI Austria, except for a single
                  copy and/or sample for documentation purposes only.

         13.3.5.  The following provisions shall survive termination of this
                  Agreement: Sections 3.8.1, 5.2.3, 7.1, 7.2, 7.3, 7.4, 7.5, 8,
                  10, 11, 12, 13.2.3, 13.2.5, 13.3 and 14. Termination of this
                  Agreement shall not relieve either Party of any liability
                  which accrued hereunder prior to the effective date of such
                  termination, nor preclude either Party from pursuing all
                  rights and remedies it may have hereunder or at law or in
                  equity with respect to any breach of this Agreement, nor
                  prejudice either Party's right to obtain performance of any
                  obligation.

14.      MISCELLANEOUS

14.1.    PERFORMANCE BY AFFILIATES

`
         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     39 of 66
<PAGE>

         The Parties recognize that each Party may perform some or all of its
         obligations under this Agreement through one or more of its AFFILIATES,
         provided, however, that each Party shall remain responsible for such
         performance by its AFFILIATES and shall cause its AFFILIATES to comply
         with the provisions of this Agreement in connection with such
         performance. Each Party hereby expressly waives any requirement that
         the other Party exhaust any right, power or remedy, or proceed against
         an AFFILIATE, for any obligation or performance hereunder prior to
         proceeding directly against such Party.

14.2.    FORCE MAJEURE

         Neither Party shall be liable for any failure or delay in performance
         or non-performance caused by circumstances beyond the reasonable
         control of such Party, including but not limited to acts of God,
         explosion, fire, flood, labor strike or labor disturbances, sabotage,
         order or decree of any court or action of any governmental authority
         (except where such order, decree or action is a direct result of BI
         Austria's breach of its obligations hereunder), or other causes,
         whether similar or dissimilar to those specified which cannot
         reasonably be controlled by the Party who failed to perform (each such
         event, a "FORCE MAJEURE EVENT"). A Party affected by a FORCE MAJEURE
         EVENT shall give notice of such to the other Party as soon as is
         reasonably possible, and shall resume performance hereunder as soon as
         is reasonably possible. Each Party shall have the right to terminate
         this Agreement in the event that a FORCE MAJEURE EVENT continues for
         more than thirty (30) business days upon written notice thereof.

14.3.    ASSIGNMENT

         14.3.1.  Except as expressly provided for herein neither this Agreement
                  nor any rights or obligations hereunder may be assigned by
                  either Party except to an AFFILIATE of either one of the
                  Parties without the prior written consent of the other Party
                  which shall not be unreasonably withheld or delayed. Any
                  subsequent assignee or transferee shall be bound by the terms
                  of this Agreement. Any assignment of this Agreement that is
                  not in conformance with this Section 14.3 shall be null, void
                  and of no legal effect.

         14.3.2.  Notwithstanding the foregoing, InterMune shall have the right
                  to assign this Agreement in case of a merger, acquisition or
                  sale of substantially all of its assets that relate to this
                  Agreement after due written notification of BI Austria.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     40 of 66

<PAGE>

         14.3.3.  In the event that either Party assigns this Agreement as
                  permitted under this Section, the other Party shall have the
                  right to terminate this Agreement upon twelve (12) months
                  written notice.

14.4.    NOTICES

         Any notice required or permitted to be given hereunder by either Party
         shall be in writing and shall be (i) delivered personally, (ii) sent by
         registered mail, return receipt requested, postage prepaid or (iii)
         delivered by facsimile and confirmed by certified or registered mail to
         the addresses or facsimile numbers set forth below:

                  If to InterMune:         InterMune Pharmaceuticals, Inc.
                                           3400 West Bayshore Road
                                           Palo Alto, CA 94303 USA
                                           Facsimile: +1 - 650 - 858 - 2937
                                           Attention: Peter Van Vlasselaer

                  If to BI Austria:        Boehringer Ingelheim Austria GmbH
                                           Dr. Boehringer-Gasse 5 - 11
                                           A-1121 Vienna, Republic of Austria
                                           Facsimile: +43 - 1 - 801 05 - 2440
                                           Attention: Monika Henninger
                                           Business Support Biotech

                  with a copy to:          Boehringer Ingelheim GmbH
                                           Binger Strasse 173
                                           D-55 216 Ingelheim am Rhein
                                           Facsimile: +49 - 61 32 77 - 98 287
                                           Attention: Rolf G. Werner
                                           Head of Industrial Biopharmaceuticals

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     41 of 66
<PAGE>

14.5.    DISPUTE RESOLUTION; GOVERNING LAW

         14.5.1.  In the event of any controversy or claim arising out of,
                  relating to or in connection with any provision of this
                  Agreement, or the rights or obligations of the Parties
                  hereunder, the Parties first shall try to settle their
                  differences amicably between themselves by referring the
                  disputed matter to the Chief Executive Officer of InterMune
                  and the Chief Executive Officer of BI Austria for discussion
                  and resolution. Either Party may initiate such informal
                  dispute resolution by sending written notice of the dispute to
                  the other Party, and within ten (10) days of such notice the
                  Chief Executive Officer of InterMune and the Chief Executive
                  Officer of BI Austria shall meet for attempted resolution by
                  good faith negotiations. If such personnel are unable to
                  resolve such dispute within thirty (30) days of initiating
                  such negotiations, each Party may thereafter pursue any and
                  all rights and remedies it may have at law or equity. If
                  mutually agreeable, the Parties may explore alternative forms
                  of dispute resolution, such as mediation.

         14.5.2.  This Agreement shall be governed by and construed in
                  accordance with the laws of the place of domicile of the
                  defendant party.

         14.5.3.  The Parties expressly exclude the application of the United
                  Nations Convention on Contracts for the International Sale of
                  Goods to this Agreement.

14.6.    INDEPENDENT CONTRACTOR

         Each of the Parties hereto is an independent contractor and nothing
         herein contained shall be deemed to constitute the relationship of
         partners, joint venture, nor of principal and agent between the Parties
         hereto. Neither Party shall have the authority to bind the other Party.

14.7.    WAIVER

         Any delay in enforcing a Party's rights under this Agreement or any
         waiver as to a particular default or other matter shall not constitute
         a waiver of such Party's rights to the future enforcement of its rights
         under this Agreement, excepting only as to an express written and
         signed waiver as to a particular matter for a particular period of
         time.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     42 of 66
<PAGE>

14.8.    SEVERABILITY

         If any of the provisions of this Agreement or parts thereof should be
         or become invalid, the remaining provisions will not be affected. The
         Parties shall undertake to replace the invalid provision or parts
         thereof by a new provision which will approximate as closely as
         possible the intent of the Parties.

14.9.    ENTIRE AGREEMENT

         This Agreement and the Exhibits set forth the entire agreement between
         the Parties, and supersede all previous agreements, negotiation and
         understanding, written or oral, regarding the subject matter hereof.
         This Agreement may be modified or amended only by an instrument in
         writing duly executed on behalf of the Parties.

14.10.   HEADINGS

         The section headings appearing herein are included solely for
         convenience of reference and are not intended to affect the
         interpretation of any provision of this Agreement.

14.11.   AMBIGUITIES

         Ambiguities, if any, in this Agreement shall not be strictly construed
         against either Party, regardless of which Party is deemed to have
         drafted the provision at issue.

14.12.   COUNTERPARTS

         The Agreement may be executed in two or more counterparts, each of
         which shall be an original and all of which shall constitute the same
         document.

14.13.   ENGLISH LANGUAGE

         The English language will govern any interpretation of or dispute in
         connection with this Agreement.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     43 of 66
<PAGE>

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

<TABLE>

<S>                                                 <C>
Vienna, Austria                                     Palo Alto, California

BOEHRINGER INGELHEIM                                INTERMUNE. PHARMACEUTICALS, INC

AUSTRIA GMBH

BY:      /s/ Irmfried Aringer                        BY:      /s/ W. Scott Harkonen
         -----------------------------------                  -----------------------------------
NAME:    Mag. DI Irmfried Aringer                    NAME:    Scott Harkonen, Ph.D.

TITLE:   Head of Production and Engineering          TITLE:   Chief Executive Officer

DATE:    27 January 2000                             DATE:             February 3, 2000

BY:      /s/ Rolf G. Werner                          BY:      /s/ Peter Van Vlasselaer
         -----------------------------------                  -----------------------------------

NAME:    Prof. Dr. Rolf G. Werner                    NAME:    Peter Van Vlasselaer, Ph.D.

TITLE:   Head of Industrial Biopharmaceuticals                TITLE:   Sen. Vice President Techn. Operations

DATE:    27 January 2000                             DATE:             February 3, 2000

</TABLE>

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     44 of 66

<PAGE>

                                TABLE OF EXHIBITS

        TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT

Exhibit 1         BI Territory

Exhibit 2         BBS SPECIFICATION

Exhibit 3         COA

Exhibit 4         COC

Exhibit 5         DNA sequence of INTERFERON GAMMA 1 b

Exhibit 6         MANUFACTURING PROCESS

Exhibit 7         PRODUCT

Exhibit 8         PROJECT MANAGER and PROJECT TEAM

Exhibit 9         PRODUCT SPECIFICATION

Exhibit 10        QUALITY ASSURANCE REQUIREMENTS

Exhibit 11        SERVICES

Exhibit 12        Timeline

Exhibit 13        STEERING COMMITTEE

Exhibit 14        Documentation to be supplied from Genentech

Exhibit 15        Protocol comparing BBS and PRODUCT

Exhibit 16        Forecast model

Exhibit 17        Prices for PRODUCT and placebo

Exhibit 18        Payment Schedule

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     45 of 66
<PAGE>

EXHIBIT 1

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

BI TERRITORY:

World-wide except USA, Canada, Japan

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     46 of 66
<PAGE>

EXHIBIT 2

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

BBS SPECIFICATIONS:

[ * ]

Note:  Differences between the specifications are marked in blue

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     47 of 66
<PAGE>

EXHIBIT 3

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

CERTIFICATE OF ANALYSIS (COA):

Each COA shall certify with respect to each shipment and lot (identified by
batch or lot number) that the BBS and/or PRODUCT was manufactured in accordance
with the Specifications and the Master Batch Record and in conformance with
cGMPs.

Attached is a specimen.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     48 of 66
<PAGE>

BOEHRINGER
INGELHEIM
Boehringer Ingelheim Austria GmbH

[ * ]

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     49 of 66
<PAGE>

EXHIBIT 4

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

CERTIFICATE OF COMPLIANCE (COC):
                                                                   Claudia Gogg
                                                                             PT
                                                                            PTS
Company
Attention to:

Address                                             Date 2000
Address

                                                           Boehringer Ingelheim
                                                                   Austria GmbH

                                                      Dr. Boehringer-Gasse 5-11
                                                                  A-1121 Vienna
                                                     Phone  ++ 43-1-80 105-5130
                                                     Telefax ++43-1-80 105-2487
                                                          E-Mail  claudia.gogg@
                                                   Vie.boehringer-Ingelheim.com
Compliance Certificate Product Name

Boehringer Ingelheim Austria (BIA) has manufactured

         Product Name

         Lot No.: B XXXXXX

In a GMP facility and in accordance with BIA Standard Operating Procedures.
Appropriate cGMP Guidelines were followed and no outstanding non-conformances
or deviations remain un-resolved.

H. Syrowatka                        K. Wagner                 C. Gogg
Quality Control                     Production                Quality Assurance

BOEHRINGER INGELHEIM

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     50 of 66

<PAGE>

AUSTRIA GmbH

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     51 of 66
<PAGE>

EXHIBIT 5

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

DNA SEQUENCE OF INTERFERON GAMMA 1b

[ * ]

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     52 of 66
<PAGE>

EXHIBIT 6

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

MANUFACTURING PROCESS

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     53 of 66
<PAGE>

EXHIBIT 7

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

PRODUCT:

[ * ]

LABELING AND PACKAGING:

-  for CLINICAL TRIAL SUPPLY:       [ * ]
                                    [ * ]

-  for MARKET SUPPLY:               [ * ]
                                    [ * ]

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     54 of 66
<PAGE>

EXHIBIT 8

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

PROJECT MANAGER AND PROJECT TEAM:

BI AUSTRIA AND BI PHARMA KG

Project Manager:  Dr. Monika Henninger, Business Support Biotech

Project Team:     Anton Vollbauer, Fermentation

                  Piotr Krauze, Purification

                  Dr. Herbert Syrowatka, QC

                  Claudia Gogg, QA

                  Dr. Volker-Ingo Glaesel, Head of Lyophilisation

INTERMUNE

Project Manager:  Peter Van Vlasselaer, Ph.D., Senior VP Technical Operations

Project Team:     Staci Ellis, Regulatory

                  (position to be filled), QA/QC

                  (position to be filled, Jim Cahill), Manufacturing

                  (position to be filled), Administrative help

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     55 of 66
<PAGE>

EXHIBIT 9

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

PRODUCT SPECIFICATIONS:

[ * ]

EXHIBIT 9 CONTINUING

[ * ]

Note:  Differences between the specifications are marked in blue

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     56 of 66
<PAGE>

EXHIBIT 10

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

INTERMUNE'S QUALITY ASSURANCE REQUIREMENTS FOR ACTIMMUNE:

-        FOR THE FIRST THREE CONFORMANCE LOTS:

1. Client copy of manufacturing batch production record
2. Client copy of filling batch production record
3. Client copy of packaging batch production record
4. Client copies of all deviations and their investigations
5. Client copy of certificate of analysis (COA) with the pre-set product
   specifications and the lot test results
6. Client copy of analytical test data (one batch only)
7. Certificate of Compliance (COC)

-        AFTER THE FIRST THREE CONFORMANCE LOTS:

All documents listed above (point 1 - 7) are available for InterMune's
inspection upon prior notice or during audits of both BI production sites. The
procedure for manufacturer qualification and the scope of batch related
documentation to be finally submitted to InterMune will be discussed and defined
between the Parties during the course of this Agreement.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     57 of 66
<PAGE>

EXHIBIT 11

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

SERVICE FOR US REGISTRATION OF rIFN-GAMMA:

1.       CARRIED OUT BY BI AUSTRIA

[ * ]

EXHIBIT 11 continuing

2.       CARRIED OUT BY BI PHARMA KG

[ * ]

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     58 of 66
<PAGE>

EXHIBIT 12

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

TIMELINE / PROJECT PLAN:

See attachment

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

[ * ]

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     59 of 66
<PAGE>

EXHIBIT 13

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

STEERING COMMITTEE
BI Austria:   Prof. Rolf Werner            (Head Industrial Biopharmaceuticals,
                                            BI Headquarters)
              Dr. Kurt Konopitzky          (Head of Production and Engineering)
              DI. Karl Wagner              (Head of Biotech Production)

              Dr. Monika Henninger         (Project Manager / Reporter)

InterMune:    Dr. Scott Harkonen           (President and CEO)
              (position to be filled)
              (position to be filled)

              Dr. Peter Van Vlasselaer     (Project Manager / Reporter)

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     60 of 66

<PAGE>

EXHIBIT 14

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

DOCUMENTATION, MATERIAL AND DATA:

A.       DOCUMENTATION  AND DATA SUPPLIED BY GENENTECH

[ * ]

Exhibit 14 continuing

[ * ]

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     61 of 66
<PAGE>

EXHIBIT 15

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

PROTOCOL COMPARING BBS AND PRODUCT

Scope

This protocol is established to show equivalence of rIFN-gamma bulk biological
substance (BBS) and finished product produced by Genentech and the rIFN-gamma
BBS produced by Boehringer Ingelheim Austria, Vienna, and finished product
filled by Boehringer Ingelheim Pharma KG, Germany, Biberach.

Background and History

[ * ]

Production process and quality control

[ * ]

Stability

[ * ]

Structure of the protocol and testing scope

1.       COMPARISON OF BBS PRODUCED AT GENENTECH AND BIA

[ * ]

2. COMPARISON OF FINISHED PRODUCT PRODUCED AT GENENTECH AND BI PHARMA KG

[ * ]

3.       COMPARISON OF REFERENCE MATERIAL

[ * ]

REMARK:
This protocol will be up-dated in order to include the FDA recommendation given
in the meeting, Washington 7 Dec 99.

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     62 of 66
<PAGE>

EXHIBIT 16

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

FORECAST MODEL;  FIRM ORDERS AND FORECAST REGULATION

[ * ]

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     63 of 66
<PAGE>

EXHIBIT 17

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

Prices for PRODUCT and placebo

A)       Price of PRODUCT

[ * ]

B)       Price for placebo

[ * ]

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     64 of 66
<PAGE>

EXHIBIT 18

TO THE DATA TRANSFER, CLINICAL TRIAL AND MARKET SUPPLY AGREEMENT DATED 27 JAN
2000

Between InterMune and BI Austria

PAYMENT SCHEDULE:

[ * ]

         [ * ] = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT,
         MARKED BY BRACKETS, HAS BEEN OMITTED AND FILED SEPARATELY WITH THE
         SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 406 OF THE
         SECURITIES ACT OF 1933, AS AMENDED.

                                     65 of 66

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