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                                                                    EXHIBIT 10.5

                            SGX PHARMACEUTICALS, INC.

                 2005 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN

            INITIALLY ADOPTED BY BOARD OF DIRECTORS AUGUST 30, 2005
              INITIALLY APPROVED BY STOCKHOLDERS OCTOBER 31, 2005
                        EFFECTIVE DATE: JANUARY _, 2006

1. PURPOSES.

      (a) ELIGIBLE OPTION RECIPIENTS. The persons eligible to receive Options
are the Non-Employee Directors of the Company.

      (b) AVAILABLE OPTIONS. The purpose of the Plan is to provide a means by
which Non-Employee Directors may be given an opportunity to benefit from
increases in value of the Common Stock through the granting of Nonstatutory
Stock Options.

      (c) GENERAL PURPOSE. The Company, by means of the Plan, seeks to retain
the services of its current Non-Employee Directors, to secure and retain the
services of new Non-Employee Directors and to provide incentives for such
persons to exert maximum efforts for the success of the Company and its
Affiliates.

2. DEFINITIONS.

      (a) "AFFILIATE" means, at the time of determination, any "parent" or
"subsidiary" as such terms are defined in Rule 405 of the Securities Act. The
Board shall have the authority to determine the time or times at which "parent"
or "subsidiary" status is determined within the foregoing definition.

      (b) "ANNUAL GRANT" means an Option granted annually to all Non-Employee
Directors who meet the specified criteria pursuant to Section 6(b).

      (c) "ANNUAL MEETING" means the annual meeting of the stockholders of the
Company.

      (d) "BOARD" means the Board of Directors of the Company.

      (e) "CAPITALIZATION ADJUSTMENT" has the meaning ascribed to that term in
Section 11(a).

      (f) "CHANGE IN CONTROL" means the occurrence, in a single transaction or
in a series of related transactions, of any one or more of the following events:

            (i) any Exchange Act Person becomes the Owner, directly or
indirectly, of securities of the Company representing more than fifty percent
(50%) of the combined voting power of the Company's then outstanding securities
other than by virtue of a merger,

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consolidation or similar transaction. Notwithstanding the foregoing, a Change in
Control shall not be deemed to occur (A) on account of the acquisition of
securities of the Company by an investor, any affiliate thereof or any other
Exchange Act Person from the Company in a transaction or series of related
transactions the primary purpose of which is to obtain financing for the Company
through the issuance of equity securities or (B) solely because the level of
Ownership held by any Exchange Act Person (the "SUBJECT PERSON") exceeds the
designated percentage threshold of the outstanding voting securities as a result
of a repurchase or other acquisition of voting securities by the Company
reducing the number of shares outstanding, provided that if a Change in Control
would occur (but for the operation of this sentence) as a result of the
acquisition of voting securities by the Company, and after such share
acquisition, the Subject Person becomes the Owner of any additional voting
securities that, assuming the repurchase or other acquisition had not occurred,
increases the percentage of the then outstanding voting securities Owned by the
Subject Person over the designated percentage threshold, then a Change in
Control shall be deemed to occur;

            (ii) there is consummated a merger, consolidation or similar
transaction involving (directly or indirectly) the Company and, immediately
after the consummation of such merger, consolidation or similar transaction, the
stockholders of the Company immediately prior thereto do not Own, directly or
indirectly, either (A) outstanding voting securities representing more than
fifty percent (50%) of the combined outstanding voting power of the surviving
Entity in such merger, consolidation or similar transaction or (B) more than
fifty percent (50%) of the combined outstanding voting power of the parent of
the surviving Entity in such merger, consolidation or similar transaction, in
each case in substantially the same proportions as their Ownership of the
outstanding voting securities of the Company immediately prior to such
transaction;

            (iii) the stockholders of the Company approve or the Board approves
a plan of complete dissolution or liquidation of the Company, or a complete
dissolution or liquidation of the Company shall otherwise occur;

            (iv) there is consummated a sale, lease, exclusive license or other
disposition of all or substantially all of the consolidated assets of the
Company and its Subsidiaries, other than a sale, lease, license or other
disposition of all or substantially all of the consolidated assets of the
Company and its Subsidiaries to an Entity, more than fifty percent (50%) of the
combined voting power of the voting securities of which are Owned by
stockholders of the Company in substantially the same proportions as their
Ownership of the outstanding voting securities of the Company immediately prior
to such sale, lease, license or other disposition; or

            (v) individuals who, on the date this Plan is adopted by the Board,
are members of the Board (the "INCUMBENT BOARD") cease for any reason to
constitute at least a majority of the members of the Board; provided, however,
that if the appointment or election (or nomination for election) of any new
Board member was approved or recommended by a majority vote of the members of
the Incumbent Board then still in office, such new member shall, for purposes of
this Plan, be considered as a member of the Incumbent Board.

      The term Change in Control shall not include a sale of assets, merger or
other transaction effected exclusively for the purpose of changing the domicile
of the Company.

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      Notwithstanding the foregoing or any other provision of this Plan, the
definition of Change in Control (or any analogous term) in an individual written
agreement between the Company or any Affiliate and the Participant shall
supersede the foregoing definition with respect to Stock Awards subject to such
agreement where such agreement provides for acceleration of vesting of such
Stock Awards in the event of a Change in Control; provided, however, that if no
definition of Change in Control or any analogous term is set forth in such an
individual written agreement, the foregoing definition shall apply.

      (g) "CODE" means the Internal Revenue Code of 1986, as amended.

      (h) "COMMITTEE" means a committee of one (1) or more members of the Board
appointed by the Board in accordance with Section 3(c).

      (i) "COMMON STOCK" means the common stock of the Company.

      (j) "COMPANY" means SGX Pharmaceuticals, Inc., a Delaware corporation.

      (k) "CONSULTANT" means any person, including an advisor, who (i) is
engaged by the Company or an Affiliate to render consulting or advisory services
and is compensated for such services or (ii) is serving as a member of the Board
of Directors of an Affiliate and is compensated for such services. However,
service solely as a Director, or payment of a fee for such services, shall not
cause a Director to be considered a "Consultant" for purposes of the Plan.

      (l) "CONTINUOUS SERVICE" means that the Optionholder's service with the
Company or an Affiliate, whether as an Employee, Director or Consultant, is not
interrupted or terminated. A change in the capacity in which the Optionholder
renders service to the Company or an Affiliate as an Employee, Consultant or
Director or a change in the entity for which the Optionholder renders such
service, provided that there is no interruption or termination of the
Optionholder's service with the Company or an Affiliate, shall not terminate a
Optionholder's Continuous Service. For example, a change in status from a
Non-Employee Director of the Company to a consultant to an Affiliate or an
Employee of the Company shall not constitute an interruption of Continuous
Service. To the extent permitted by law, the Board or the chief executive
officer of the Company, in that party's sole discretion, may determine whether
Continuous Service shall be considered interrupted in the case of any leave of
absence approved by that party, including sick leave, military leave or any
other personal leave. Notwithstanding the foregoing, a leave of absence shall be
treated as Continuous Service for purposes of vesting in an Option only to such
extent as may be provided in the Company's leave of absence policy, in the
written terms of any leave of absence agreement or policy applicable to the
Optionholder, or as otherwise required by law.

      (m) "CORPORATE TRANSACTION" means the occurrence, in a single transaction
or in a series of related transactions, of any one or more of the following
events:

            (i) a sale or other disposition of all or substantially all, as
determined by the Board in its sole discretion, of the consolidated assets of
the Company and its Subsidiaries;

            (ii) a sale or other disposition of at least ninety percent (90%) of
the outstanding securities of the Company;

                                       3.
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            (iii) the consummation of a merger, consolidation or similar
transaction following which the Company is not the surviving corporation; or

            (iv) the consummation of a merger, consolidation or similar
transaction following which the Company is the surviving corporation but the
shares of Common Stock outstanding immediately preceding the merger,
consolidation or similar transaction are converted or exchanged by virtue of the
merger, consolidation or similar transaction into other property, whether in the
form of securities, cash or otherwise.

      (n) "DIRECTOR" means a member of the Board.

      (o) "DISABILITY" means the inability of a person, in the opinion of a
qualified physician acceptable to the Company, to perform the major duties of
that person's position with the Company or an Affiliate of the Company because
of the sickness or injury of the person.

      (p) "EMPLOYEE" means any person employed by the Company or an Affiliate.
However, service solely as a Director, or payment of a fee for such services,
shall not cause a Director to be considered an "Employee" for purposes of the
Plan.

      (q) "ENTITY" means a corporation, partnership or other entity.

      (r) "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.

      (s) "EXCHANGE ACT PERSON" means any natural person, Entity or "group"
(within the meaning of Section 13(d) or 14(d) of the Exchange Act), except that
"Exchange Act Person" shall not include (i) the Company or any Subsidiary of the
Company, (ii) any employee benefit plan of the Company or any Subsidiary of the
Company or any trustee or other fiduciary holding securities under an employee
benefit plan of the Company or any Subsidiary of the Company, (iii) an
underwriter temporarily holding securities pursuant to an offering of such
securities, (iv) an Entity Owned, directly or indirectly, by the stockholders of
the Company in substantially the same proportions as their Ownership of stock of
the Company; or (v) any natural person, Entity or "group" (within the meaning of
Section 13(d) or 14(d) of the Exchange Act) that, as of the effective date of
the Plan as set forth in Section 14, is the Owner, directly or indirectly, of
securities of the Company representing more than fifty percent (50%) of the
combined voting power of the Company's then outstanding securities.

      (t) "FAIR MARKET VALUE" means, as of any date, the value of the Common
Stock determined as follows:

            (i) If the Common Stock is listed on any established stock exchange
or traded on the Nasdaq National Market or the Nasdaq SmallCap Market, the Fair
Market Value of a share of Common Stock shall be the closing sales price for
such stock (or the closing bid, if no sales were reported) as quoted on such
exchange or market (or the exchange or market with the greatest volume of
trading in the Common Stock) on the last market trading day prior to the date in
question, as reported in The Wall Street Journal or such other source as the
Board deems reliable. Unless otherwise provided by the Board, if there is no
closing sales price (or closing bid if no sales were reported) for the Common
Stock on the date in question, then the Fair

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Market Value shall be the closing selling price (or closing bid if no sales were
reported) on the last preceding date for which such quotation exists.

            (ii) In the absence of such markets for the Common Stock, the Fair
Market Value shall be determined by the Board in good faith.

      (u) "INITIAL GRANT" means an Option granted to a Non-Employee Director who
meets the specified criteria pursuant to Section 6(a).

      (v) "IPO DATE" means the date of the underwriting agreement between the
Company and the underwriter(s) managing the initial public offering of the
Common Stock, pursuant to which the Common Stock is priced for the initial
public offering.

      (w) "NON-EMPLOYEE DIRECTOR" means a Director who is not an Employee.

      (x) "NONSTATUTORY STOCK OPTION" means an Option not intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code and the
regulations promulgated thereunder.

      (y) "OFFICER" means a person who is an officer of the Company within the
meaning of Section 16 of the Exchange Act and the rules and regulations
promulgated thereunder.

      (z) "OPTION" means a Nonstatutory Stock Option granted pursuant to the
Plan.

      (aa) "OPTION AGREEMENT" means a written agreement between the Company and
an Optionholder evidencing the terms and conditions of an individual Option
grant. Each Option Agreement shall be subject to the terms and conditions of the
Plan.

      (bb) "OPTIONHOLDER" means a person to whom an Option is granted pursuant
to the Plan or, if applicable, such other person who holds an outstanding
Option.

      (cc) "OWN," "OWNED," "OWNER," "OWNERSHIP" A person or Entity shall be
deemed to "Own," to have "Owned," to be the "Owner" of, or to have acquired
"Ownership" of securities if such person or Entity, directly or indirectly,
through any contract, arrangement, understanding, relationship or otherwise, has
or shares voting power, which includes the power to vote or to direct the
voting, with respect to such securities.

      (dd) "PLAN" means this SGX Pharmaceuticals, Inc. 2005 Non-Employee
Directors' Stock Option Plan.

      (ee) "RULE 16b-3" means Rule 16b-3 promulgated under the Exchange Act or
any successor to Rule 16b-3, as in effect from time to time.

      (ff) "SECURITIES ACT" means the Securities Act of 1933, as amended.

      (gg) "SUBSIDIARY" means, with respect to the Company, (i) any corporation
of which more than fifty percent (50%) of the outstanding capital stock having
ordinary voting power to elect a majority of the board of directors of such
corporation (irrespective of whether, at the time,

                                       5.
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stock of any other class or classes of such corporation shall have or might have
voting power by reason of the happening of any contingency) is at the time,
directly or indirectly, Owned by the Company, and (ii) any partnership in which
the Company has a direct or indirect interest (whether in the form of voting or
participation in profits or capital contribution) of more than fifty percent
(50%).

3. ADMINISTRATION.

      (a) ADMINISTRATION BY BOARD. The Board shall administer the Plan unless
and until the Board delegates administration of the Plan to a Committee, as
provided in Section 3(c).

      (b) POWERS OF BOARD. The Board shall have the power, subject to, and
within the limitations of, the express provisions of the Plan:

            (i) To determine the provisions of each Option to the extent not
specified in the Plan.

            (ii) To construe and interpret the Plan and Options granted under
it, and to establish, amend and revoke rules and regulations for its
administration. The Board, in the exercise of this power, may correct any
defect, omission or inconsistency in the Plan or in any Option Agreement, in a
manner and to the extent it shall deem necessary or expedient to make the Plan
fully effective.

            (iii) To effect, at any time and from time to time, with the consent
of any adversely affected Optionholder, (1) the reduction of the exercise price
of any outstanding Option under the Plan, (2) the cancellation of any
outstanding Option under the Plan and the grant in substitution therefor of (A)
a new Option under the Plan or another equity plan of the Company covering the
same or a different number of shares of Common Stock, (B) cash and/or (C) other
valuable consideration (as determined by the Board, in its sole discretion), or
(3) any other action that is treated as a repricing under generally accepted
accounting principles.

            (iv) To amend the Plan or an Option as provided in Section 12.

            (v) To terminate or suspend the Plan as provided in Section 13.

            (vi) Generally, to exercise such powers and to perform such acts as
the Board deems necessary or expedient to promote the best interests of the
Company and that are not in conflict with the provisions of the Plan.

      (c) DELEGATION TO COMMITTEE. The Board may delegate some or all of the
administration of the Plan to a Committee or Committees of one (1) or more
members of the Board, and the term "COMMITTEE" shall apply to any person or
persons to whom such authority has been delegated. If administration is
delegated to a Committee, the Committee shall have, in connection with the
administration of the Plan, the powers theretofore possessed by the Board that
have been delegated to the Committee, including the power to delegate to a
subcommittee any of the administrative powers the Committee is authorized to
exercise (and references in this Plan to the Board shall thereafter be to the
Committee or subcommittee), subject, however, to such resolutions, not
inconsistent with the provisions of the Plan, as may be adopted from time to

                                       6.
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time by the Board. The Board may retain the authority to concurrently administer
the Plan with the Committee and may, at any time, revest in the Board some or
all of the powers previously delegated.

      (d) EFFECT OF BOARD'S DECISION. All determinations, interpretations and
constructions made by the Board in good faith shall not be subject to review by
any person and shall be final, binding and conclusive on all persons.

4. SHARES SUBJECT TO THE PLAN.

      (a) SHARE RESERVE. Subject to the provisions of Section 11(a) relating to
Capitalization Adjustments, the shares of Common Stock that may be issued
pursuant to Options shall not exceed in the aggregate seventy-five thousand
(75,000) shares of Common Stock plus an annual increase to be added on January
1st of each year commencing in 2007 and ending on (and including) January 1,
2015, equal to the lesser of: (i) the aggregate number of shares of Common Stock
subject to options granted under the Plan as Initial Grants and Annual Grants
during the immediately preceding fiscal year, or (ii) an amount determined by
the Board or a Committee.

      (b) REVERSION OF SHARES TO THE SHARE RESERVE. If any Option shall for any
reason expire or otherwise terminate, in whole or in part, without having been
exercised in full, the shares of Common Stock not acquired under such Option
shall revert to and again become available for issuance under the Plan. If any
shares subject to an Option are not delivered to an Optionholder because such
shares are withheld for the payment of taxes or the Option is exercised through
a reduction of shares subject to the Option (i.e., "net exercised"), the number
of shares that are not delivered to the Optionholder as a result thereof shall
remain available for issuance under the Plan. If the exercise price of an Option
is satisfied by tendering shares of Common Stock held by the Optionholder
(either by actual delivery or attestation), then the number of shares so
tendered shall remain available for issuance under the Plan.

      (c) SOURCE OF SHARES. The shares of Common Stock subject to the Plan may
be unissued shares or reacquired shares, bought on the market or otherwise.

5. ELIGIBILITY.

      The Options, as set forth in Section 6, automatically shall be granted
under the Plan to all Non-Employee Directors who meet the criteria specified in
Section 6.

6. NON-DISCRETIONARY GRANTS.

      (a) INITIAL GRANTS. Without any further action of the Board, each person
who after the IPO Date is elected or appointed for the first time to be a
Non-Employee Director automatically shall, upon the date of his or her initial
election or appointment to be a Non-Employee Director, be granted an Initial
Grant to purchase twelve thousand five hundred (12,500) shares of Common Stock
on the terms and conditions set forth herein.

      (b) ANNUAL GRANTS. Without any further action of the Board, on the date of
each Annual Meeting, commencing with the Annual Meeting in 2007, each person who
is then a Non-

                                       7.
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Employee Director automatically shall be granted an Annual Grant to purchase
five thousand (5,000) shares of Common Stock on the terms and conditions set
forth herein; provided, however, that if a person who is first elected as a
Non-Employee Director after the IPO Date has not been serving as a Non-Employee
Director for the entire period since the preceding Annual Meeting, then the
number of shares subject to such Annual Grant shall be reduced pro rata for each
full quarter prior to the date of grant during such period for which such person
did not serve as a Non- Employee Director.

7. OPTION PROVISIONS.

      Each Option shall be in such form and shall contain such terms and
conditions as required by the Plan. Each Option shall contain such additional
terms and conditions, not inconsistent with the Plan, as the Board shall deem
appropriate. Each Option shall include (through incorporation of provisions
hereof by reference in the Option or otherwise) the substance of each of the
following provisions:

      (a) TERM. No Option shall be exercisable after the expiration of ten (10)
years from the date on which it was granted.

      (b) EXERCISE PRICE. The exercise price of each Option shall be one hundred
percent (100%) of the Fair Market Value of the Common Stock subject to the
Option on the date the Option is granted.

      (c) CONSIDERATION. The purchase price of Common Stock acquired pursuant to
an Option shall be paid, to the extent permitted by applicable law, either (i)
in cash at the time the Option is exercised or (ii) at the discretion of the
Board either at the time of the grant of the Option or subsequent thereto (1) by
delivery to the Company of other Common Stock at the time the Option is
exercised, (2) by a "net exercise" of the Option (as further described below),
(3) pursuant to a program developed under Regulation T as promulgated by the
Federal Reserve Board that, prior to the issuance of Common Stock, results in
either the receipt of cash (or check) by the Company or the receipt of
irrevocable instructions to pay the aggregate exercise price to the Company from
the sales proceeds or (4) in any other form of legal consideration that may be
acceptable to the Board. Unless otherwise specifically provided in the Option,
the purchase price of Common Stock acquired pursuant to an Option that is paid
by delivery to the Company of other Common Stock acquired, directly or
indirectly from the Company, shall be paid only by shares of the Common Stock of
the Company that have been held for more than six (6) months (or such longer or
shorter period of time required to avoid a charge to earnings for financial
accounting purposes).

      In the case of a "net exercise" of an Option, the Company will not require
a payment of the exercise price of the Option from the Optionholder but will
reduce the number of shares of Common Stock issued upon the exercise by the
largest number of whole shares that has a Fair Market Value that does not exceed
the aggregate exercise price. With respect to any remaining balance of the
aggregate exercise price, the Company shall accept a cash payment from the
Optionholder. Shares of Common Stock will no longer be outstanding under an
Option (and will therefore not thereafter be exercisable) following the exercise
of such Option to the extent of (i) shares used to pay the exercise price of an
Option under a "net exercise", (ii) shares actually

                                       8.
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delivered to the Optionholder as a result of such exercise and (iii) shares
withheld for purposes of tax withholding.

      (d) TRANSFERABILITY. An Option is transferable by will or by the laws of
descent and distribution. An Option also may be transferable upon written
consent of the Company if, at the time of transfer, a Form S-8 registration
statement under the Securities Act is available for the exercise of the Option
and the subsequent resale of the underlying securities. In addition, an
Optionholder may, by delivering written notice to the Company, in a form
provided by or otherwise satisfactory to the Company, designate a third party
who, in the event of the death of the Optionholder, shall thereafter be entitled
to exercise the Option.

      (e) VESTING. Options shall vest as follows:

            (i) Initial Grants: 1/36th of the shares of Common Stock subject to
an Initial Grant shall vest monthly over three (3) years.

            (ii) Annual Grants: 1/12th of the shares of Common Stock subject to
an Annual Grant shall vest monthly over one (1) year.

      (f) TERMINATION OF CONTINUOUS SERVICE. In the event that an Optionholder's
Continuous Service terminates for any reason, the Optionholder may exercise his
or her Option (to the extent that the Optionholder was entitled to exercise such
Option as of the date of termination of Continuous Service) but only within such
period of time ending on the expiration of the term of the Option as set forth
in the Option Agreement. If, after termination of Continuous Service, the
Optionholder does not exercise his or her Option within the time specified in
the Option Agreement, the Option shall terminate.

8. SECURITIES LAW COMPLIANCE.

      The Company shall seek to obtain from each regulatory commission or agency
having jurisdiction over the Plan such authority as may be required to grant
Options and to issue and sell shares of Common Stock upon exercise of the
Options; provided, however, that this undertaking shall not require the Company
to register under the Securities Act the Plan, any Option or any Common Stock
issued or issuable pursuant to any such Option. If, after reasonable efforts,
the Company is unable to obtain from any such regulatory commission or agency
the authority which counsel for the Company deems necessary for the lawful
issuance and sale of Common Stock under the Plan, the Company shall be relieved
from any liability for failure to issue and sell Common Stock upon exercise of
such Options unless and until such authority is obtained.

9. USE OF PROCEEDS FROM STOCK.

      Proceeds from the sale of Common Stock pursuant to Options shall
constitute general funds of the Company.

10. MISCELLANEOUS.

      (a) ACCELERATION OF EXERCISABILITY AND VESTING. The Board shall have the
power to accelerate the time at which an Option may first be exercised or the
time during which an Option

                                       9.
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or any part thereof will vest in accordance with the Plan, notwithstanding the
provisions in the Plan or the Option stating the time at which it may first be
exercised or the time during which it will vest.

      (b) STOCKHOLDER RIGHTS. No Optionholder shall be deemed to be the holder
of, or to have any of the rights of a holder with respect to, any shares of
Common Stock subject to such Option unless and until such Optionholder has
satisfied all requirements for exercise of the Option pursuant to its terms.

      (c) NO SERVICE RIGHTS. Nothing in the Plan, any Option Agreement or other
instrument executed thereunder or any Option granted pursuant thereto shall
confer upon any Optionholder any right to continue to serve the Company as a
Non-Employee Director or shall affect the right of the Company or an Affiliate
to terminate (i) the employment of an Employee with or without notice and with
or without cause, (ii) the service of a Consultant pursuant to the terms of such
Consultant's agreement with the Company or an Affiliate or (iii) the service of
a Director pursuant to the Bylaws of the Company or an Affiliate, and any
applicable provisions of the corporate law of the state in which the Company or
the Affiliate is incorporated, as the case may be.

      (d) INVESTMENT ASSURANCES. The Company may require an Optionholder, as a
condition of exercising or acquiring Common Stock under any Option, (i) to give
written assurances satisfactory to the Company as to the Optionholder's
knowledge and experience in financial and business matters and/or to employ a
purchaser representative reasonably satisfactory to the Company who is
knowledgeable and experienced in financial and business matters and that he or
she is capable of evaluating, alone or together with the purchaser
representative, the merits and risks of exercising the Option; and (ii) to give
written assurances satisfactory to the Company stating that the Optionholder is
acquiring the Common Stock subject to the Option for the Optionholder's own
account and not with any present intention of selling or otherwise distributing
the Common Stock. The foregoing requirements, and any assurances given pursuant
to such requirements, shall be inoperative if (1) the issuance of the shares of
Common Stock upon the exercise or acquisition of Common Stock under the Option
has been registered under a then currently effective registration statement
under the Securities Act or (2) as to any particular requirement, a
determination is made by counsel for the Company that such requirement need not
be met in the circumstances under the then applicable securities laws. The
Company may, upon advice of counsel to the Company, place legends on stock
certificates issued under the Plan as such counsel deems necessary or
appropriate in order to comply with applicable securities laws, including, but
not limited to, legends restricting the transfer of the Common Stock.

      (e) WITHHOLDING OBLIGATIONS. To the extent provided by the terms of an
Option Agreement, the Company may in its sole discretion, satisfy any federal,
state or local tax withholding obligation relating to an Option by any of the
following means (in addition to the Company's right to withhold from any
compensation paid to the Optionholder by the Company) or by a combination of
such means: (i) causing the Optionholder to tender a cash payment; (ii)
withholding shares of Common Stock from the shares of Common Stock issued or
otherwise issuable to the Optionholder in connection with the Option; or (iii)
via such other method as may be set forth in the Option Agreement.

                                      10.
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11. ADJUSTMENTS UPON CHANGES IN COMMON STOCK.

      (a) CAPITALIZATION ADJUSTMENTS. If any change is made in, or other event
occurs with respect to, the Common Stock subject to the Plan, or subject to any
Option, without the receipt of consideration by the Company (through merger,
consolidation, reorganization, recapitalization, reincorporation, stock
dividend, dividend in property other than cash, stock split, liquidating
dividend, combination of shares, exchange of shares, change in corporate
structure or other transaction not involving the receipt of consideration by the
Company (each a "CAPITALIZATION ADJUSTMENT")), the Plan will be appropriately
adjusted in the class(es) and maximum number of securities subject both to the
Plan pursuant to Section 4 and to the nondiscretionary Options specified in
Section 6, and the outstanding Options will be appropriately adjusted in the
class(es) and number of securities and price per share of Common Stock subject
to such outstanding Options. The Board shall make such adjustments, and its
determination shall be final, binding and conclusive. (Notwithstanding the
foregoing, the conversion of any convertible securities of the Company shall not
be treated as a transaction "without receipt of consideration" by the Company.)

      (b) DISSOLUTION OR LIQUIDATION. In the event of a dissolution or
liquidation of the Company, then all outstanding Options shall terminate
immediately prior to the completion of such dissolution or liquidation.

      (c) CORPORATE TRANSACTION. The following provisions shall apply to Options
in the event of a Corporate Transaction unless otherwise provided in the
instrument evidencing the Option or any other written agreement between the
Company or any Affiliate and the holder of the Option or unless otherwise
expressly provided by the Board at the time of grant of a Option. In the event
of a Corporate Transaction, any surviving corporation or acquiring corporation
may assume or continue any or all Options outstanding under the Plan or may
substitute similar stock options for Options outstanding under the Plan
(including options to acquire the same consideration paid to the stockholders of
the Company, as the case may be, pursuant to the Corporate Transaction). In the
event that any surviving corporation or acquiring corporation does not assume or
continue all such outstanding Options or substitute similar stock options for
all such outstanding Options, then with respect to Options that have been not
assumed, continued or substituted and that are held by Optionholders whose
Continuous Service has not terminated prior to the effective time of the
Corporate Transaction, the vesting of such Options (and, if applicable, the time
at which such Options may be exercised) shall (contingent upon the effectiveness
of the Corporate Transaction) be accelerated in full to a date prior to the
effective time of such Corporate Transaction as the Board shall determine (or,
if the Board shall not determine such a date, to the date that is five (5) days
prior to the effective time of the Corporate Transaction), and such Options
shall terminate on the effective time of the Corporate Transaction if not
exercised (if applicable) at or prior to such effective time. With respect to
any other Options outstanding under the Plan that have not been assumed,
continued or substituted, the vesting of such Options (and, if applicable, the
time at which such Options may be exercised) shall not be accelerated, unless
otherwise provided in a written agreement between the Company or any Affiliate
and the Optionholder, and such Options shall terminate if not exercised (if
applicable) prior to the effective time of the Corporate Transaction.

                                      11.
<PAGE>

      (d) CHANGE IN CONTROL. An Option may be subject to additional acceleration
of vesting and exercisability upon or after a Change in Control as may be
provided in the Option Agreement for such Option or as may be provided in any
other written agreement between the Company or any Affiliate and the
Optionholder, but in the absence of such provision, no such acceleration shall
occur.

12. AMENDMENT OF THE PLAN AND OPTIONS.

      (a) AMENDMENT OF PLAN. Subject to the limitations, if any, of applicable
law, the Board, at any time and from time to time, may amend the Plan. However,
except as provided in Section 11(a) relating to Capitalization Adjustments, no
amendment shall be effective unless approved by the stockholders of the Company
to the extent stockholder approval is necessary to satisfy applicable law.

      (b) STOCKHOLDER APPROVAL. The Board, in its sole discretion, may submit
any other amendment to the Plan for stockholder approval.

      (c) NO IMPAIRMENT OF RIGHTS. Rights under any Option granted before
amendment of the Plan shall not be impaired by any amendment of the Plan unless
(i) the Company requests the consent of the Optionholder and (ii) the
Optionholder consents in writing.

      (d) AMENDMENT OF OPTIONS. The Board, at any time, and from time to time,
may amend the terms of any one or more Options, including, but not limited to,
amendments to provide terms more favorable than previously provided in the
agreement evidencing an Option, subject to any specified limits in the Plan that
are not subject to Board discretion; provided, however, that the rights under
any Option shall not be impaired by any such amendment unless (i) the Company
requests the consent of the Optionholder and (ii) the Optionholder consents in
writing.

13. TERMINATION OR SUSPENSION OF THE PLAN.

      (a) PLAN TERM. The Board may suspend or terminate the Plan at any time. No
Options may be granted under the Plan while the Plan is suspended or after it is
terminated.

      (b) NO IMPAIRMENT OF RIGHTS. Suspension or termination of the Plan shall
not impair rights and obligations under any Option granted while the Plan is in
effect except with the written consent of the Optionholder.

14. EFFECTIVE DATE OF PLAN.

      The Plan shall become effective on the IPO Date, but no Option shall be
exercised unless and until the Plan has been approved by the stockholders of the
Company, which approval shall be within twelve (12) months before or after the
date the Plan is adopted by the Board.

15. CHOICE OF LAW.

      The law of the state of California shall govern all questions concerning
the construction, validity and interpretation of this Plan, without regard to
such state's conflict of laws rules.

                                      12.
<PAGE>

                            SGX PHARMACEUTICALS, INC.
                 2005 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN

                             STOCK OPTION AGREEMENT
                           (NONSTATUTORY STOCK OPTION)

      Pursuant to your Stock Option Grant Notice ("Grant Notice") and this Stock
Option Agreement, SGX Pharmaceuticals, Inc. (the "Company") has granted you an
option under its 2005 Non-Employee Directors' Stock Option Plan (the "Plan") to
purchase the number of shares of the Company's Common Stock indicated in your
Grant Notice at the exercise price indicated in your Grant Notice. Defined terms
not explicitly defined in this Stock Option Agreement but defined in the Plan
shall have the same definitions as in the Plan.

      The details of your option are as follows:

      1. VESTING. Subject to the limitations contained herein, your option will
vest as provided in your Grant Notice, provided that vesting will cease upon the
termination of your Continuous Service. In addition, if the Company is subject
to a Change in Control before your Continuous Service terminates, then all of
the unvested shares subject to this option shall become fully vested and
exercisable immediately prior to the effective date of such Change in Control.

      2. NUMBER OF SHARES AND EXERCISE PRICE. The number of shares of Common
Stock subject to your option and your exercise price per share referenced in
your Grant Notice may be adjusted from time to time for Capitalization
Adjustments, as provided in the Plan.

      3. METHOD OF PAYMENT. Payment of the exercise price is due in full upon
exercise of all or any part of your option. You may elect to make payment of the
exercise price in cash or by check or in any other manner PERMITTED BY YOUR
GRANT NOTICE, which may include one or more of the following:

            (a) In the Company's sole discretion at the time your option is
exercised and provided that at the time of exercise the Common Stock is publicly
traded and quoted regularly in The Wall Street Journal, pursuant to a program
developed under Regulation T as promulgated by the Federal Reserve Board that,
prior to the issuance of Common Stock, results in either the receipt of cash (or
check) by the Company or the receipt of irrevocable instructions to pay the
aggregate exercise price to the Company from the sales proceeds.

            (b) Provided that at the time of exercise the Common Stock is
publicly traded and quoted regularly in The Wall Street Journal, by delivery of
already-owned shares of Common Stock either that you have held for the period
required to avoid a charge to the Company's reported earnings (generally six
months) or that you did not acquire, directly or indirectly from the Company,
that are owned free and clear of any liens, claims, encumbrances or security
interests, and that are valued at Fair Market Value on the date of exercise.
"Delivery" for these purposes, in the sole discretion of the Company at the time
you exercise your option, shall include delivery to the Company of your
attestation of ownership of such shares of Common Stock in a form approved by
the Company. Notwithstanding the foregoing, you may

                                       1.
<PAGE>

not exercise your option by tender to the Company of Common Stock to the extent
such tender would violate the provisions of any law, regulation or agreement
restricting the redemption of the Company's stock.

      4. WHOLE SHARES. You may exercise your option only for whole shares of
Common Stock.

      5. SECURITIES LAW COMPLIANCE. Notwithstanding anything to the contrary
contained herein, you may not exercise your option unless the shares of Common
Stock issuable upon such exercise are then registered under the Securities Act
or, if such shares of Common Stock are not then so registered, the Company has
determined that such exercise and issuance would be exempt from the registration
requirements of the Securities Act. The exercise of your option must also comply
with other applicable laws and regulations governing your option, and you may
not exercise your option if the Company determines that such exercise would not
be in material compliance with such laws and regulations.

      6. TERM. You may not exercise your option before the commencement of its
term or after its term expires. The term of your option commences on the Date of
Grant and expires upon the earliest of the following:

            (a) three (3) months after the termination of your Continuous
Service for any reason other than your Disability or death (or in connection
with a Change in Control as provided in subsection (b) below), provided that if
during any part of such three- (3-) month period your option is not exercisable
solely because of the condition set forth in the preceding paragraph relating to
"Securities Law Compliance," your option shall not expire until the earlier of
the Expiration Date or until it shall have been exercisable for an aggregate
period of three (3) months after the termination of your Continuous Service;

            (b) twelve (12) months after the termination of your Continuous
Service in connection with a Change in Control where all of the unvested shares
subject to your option become fully vested and exercisable immediately prior to
the effective date of such Change in Control in accordance with the provisions
of Section 1 above;

            (c) twelve (12) months after the termination of your Continuous
Service due to your Disability;

            (d) eighteen (18) months after your death if you die either during
your Continuous Service or within three (3) months after your Continuous Service
terminates;

            (e) the Expiration Date indicated in your Grant Notice; or

            (f) the day before the tenth (10th) anniversary of the Date of
Grant.

      Notwithstanding the foregoing, if your sale of the shares acquired upon
exercise of your option would subject you to suit under Section 16(b) of the
Exchange Act, your option shall remain exercisable until the earlier of (i) the
expiration of a period of ten (10) days after the date on which a sale of the
shares by you would no longer be subject to such suit, (ii) the expiration of

                                       2.
<PAGE>

the one hundred and ninetieth (190th) day after your termination of Continuous
Service, or (iii) the Expiration Date indicated in your Grant Notice.

      7. EXERCISE.

            (a) You may exercise the vested portion of your option (and the
unvested portion of your option if your Grant Notice so permits) during its term
by delivering a Notice of Exercise (in a form designated by the Company)
together with the exercise price to the Secretary of the Company, or to such
other person as the Company may designate, during regular business hours,
together with such additional documents as the Company may then require.

            (b) By exercising your option you agree that, as a condition to any
exercise of your option, the Company may require you to enter into an
arrangement providing for the payment by you to the Company of any tax
withholding obligation of the Company arising by reason of (1) the exercise of
your option, (2) the lapse of any substantial risk of forfeiture to which the
shares of Common Stock are subject at the time of exercise, or (3) the
disposition of shares of Common Stock acquired upon such exercise.

      8. TRANSFERABILITY. Your option is not transferable, except (i) by will or
by the laws of descent and distribution, (ii) with the prior written approval of
the Company, by instrument to an inter vivos or testamentary trust, in a form
accepted by the Company, in which the option is to be passed to beneficiaries
upon the death of the trustor (settlor) and (iii) with the prior written
approval of the Company, by gift, in a form accepted by the Company, to a
permitted transferee under Rule 701 of the Securities Act.

      9. OPTION NOT A SERVICE CONTRACT. Your option is not an employment or
service contract, and nothing in your option shall be deemed to create in any
way whatsoever any obligation on your part to continue in the employ of the
Company or an Affiliate, or of the Company or an Affiliate to continue your
employment. In addition, nothing in your option shall obligate the Company or an
Affiliate, their respective shareholders, Boards of Directors, Officers or
Employees to continue any relationship that you might have as a Director or
Consultant for the Company or an Affiliate.

      10. WITHHOLDING OBLIGATIONS.

            (a) At the time you exercise your option, in whole or in part, or at
any time thereafter as requested by the Company, you hereby authorize
withholding from payroll and any other amounts payable to you, and otherwise
agree to make adequate provision as directed by the Company (including by means
of a "cashless exercise" pursuant to a program developed under Regulation T as
promulgated by the Federal Reserve Board to the extent directed by the Company),
for any sums required to satisfy the federal, state, local and foreign tax
withholding obligations of the Company or an Affiliate, if any, which arise in
connection with your option.

            (b) The Company may, in its sole discretion, and in compliance with
any applicable conditions or restrictions of law, withhold from fully vested
shares of Common Stock otherwise issuable to you upon the exercise of your
option a number of whole shares of Common Stock having a Fair Market Value,
determined by the Company as of the date of exercise, not in

                                       3.
<PAGE>

excess of the minimum amount of tax required to be withheld by law. Any adverse
consequences to you arising in connection with such share withholding procedure
shall be your sole responsibility.

            (c) You may not exercise your option unless the tax withholding
obligations of the Company and/or any Affiliate are satisfied. Accordingly, you
may not be able to exercise your option when desired even though your option is
vested, and the Company shall have no obligation to issue a certificate for such
shares of Common Stock or release such shares of Common Stock from any escrow
provided for herein.

      11. PARACHUTE PAYMENTS.

            (a) If any payment or benefit you would receive pursuant to a Change
in Control from the Company or otherwise ("Payment") would (i) constitute a
"parachute payment" within the meaning of Section 280G of the Code, and (ii) but
for this sentence, be subject to the excise tax imposed by Section 4999 of the
Code (the "Excise Tax"), then such Payment shall be equal to the Reduced Amount.
The "Reduced Amount" shall be either (x) the largest portion of the Payment that
would result in no portion of the Payment being subject to the Excise Tax or (y)
the largest portion, up to and including the total, of the Payment, whichever
amount, after taking into account all applicable federal, state and local
employment taxes, income taxes, and the Excise Tax (all computed at the highest
applicable marginal rate), results in your receipt, on an after-tax basis, of
the greater amount of the Payment notwithstanding that all or some portion of
the Payment may be subject to the Excise Tax. If a reduction in payments or
benefits constituting "parachute payments" is necessary so that the Payment
equals the Reduced Amount, reduction shall occur in the following order unless
you elect in writing a different order (provided, however, that such election
shall be subject to Company approval if made on or after the effective date of
the event that triggers the Payment): reduction of cash payments; cancellation
of accelerated vesting of Stock Awards; reduction of employee benefits. In the
event that acceleration of vesting of Stock Award compensation is to be reduced,
such acceleration of vesting shall be cancelled in the reverse order of the date
of grant of your Stock Awards (i.e., earliest granted Stock Award cancelled
last) unless you elect in writing a different order for cancellation.

            (b) The accounting firm engaged by the Company for general audit
purposes as of the day prior to the effective date of the Change in Control
shall perform the foregoing calculations. If the accounting firm so engaged by
the Company is serving as accountant or auditor for the individual, entity or
group effecting the Change in Control, the Company shall appoint a nationally
recognized accounting firm to make the determinations required hereunder. The
Company shall bear all expenses with respect to the determinations by such
accounting firm required to be made hereunder.

            (c) The accounting firm engaged to make the determinations hereunder
shall provide its calculations, together with detailed supporting documentation,
to you and the Company within fifteen (15) calendar days after the date on which
your right to a Payment is triggered (if requested at that time by you or the
Company) or such other time as requested by you or the Company. If the
accounting firm determines that no Excise Tax is payable with respect to a
Payment, either before or after the application of the Reduced Amount, it shall

                                       4.
<PAGE>

furnish you and the Company with an opinion reasonably acceptable to you that no
Excise Tax will be imposed with respect to such Payment. Any good faith
determinations of the accounting firm made hereunder shall be final, binding and
conclusive upon you and the Company, except as specified below.

            (d) If, notwithstanding any reduction described in this Section 10,
the IRS determines that you are liable for the Excise Tax as a result of the
receipt of the payment of benefits as described above, then you shall be
obligated to pay back to the Company, within thirty (30) days after a final IRS
determination or in the event that you challenge the final IRS determination, a
final judicial determination, a portion of the payment equal to the "Repayment
Amount." The Repayment Amount with respect to the payment of benefits shall be
the smallest such amount, if any, as shall be required to be paid to the Company
so that your net after-tax proceeds with respect to any payment of benefits
(after taking into account the payment of the Excise Tax and all other
applicable taxes imposed on such payment) shall be maximized. The Repayment
Amount with respect to the payment of benefits shall be zero if a Repayment
Amount of more than zero would not result in your net after-tax proceeds with
respect to the payment of such benefits being maximized. If the Excise Tax is
not eliminated pursuant to this paragraph, you shall pay the Excise Tax.

            (e) Notwithstanding any other provision of this Section 10, if (i)
there is a reduction in the payment of benefits as described in this Section 10,
(ii) the IRS later determines that you are liable for the Excise Tax, the
payment of which would result in the maximization of your net after-tax proceeds
(calculated as if your benefits had not previously been reduced), and (iii) you
pay the Excise Tax, then the Company shall pay to you those benefits which were
reduced pursuant to this section contemporaneously or as soon as
administratively possible after you pay the Excise Tax so that your net
after-tax proceeds with respect to the payment of benefits is maximized.

      12. NOTICES. Any notices provided for in your option or the Plan shall be
given in writing and shall be deemed effectively given upon receipt or, in the
case of notices delivered by mail by the Company to you, five (5) days after
deposit in the United States mail, postage prepaid, addressed to you at the last
address you provided to the Company.

      13. GOVERNING PLAN DOCUMENT. Your option is subject to all the provisions
of the Plan, the provisions of which are hereby made a part of your option, and
is further subject to all interpretations, amendments, rules and regulations
which may from time to time be promulgated and adopted pursuant to the Plan. In
the event of any conflict between the provisions of your option and those of the
Plan, the provisions of the Plan shall control.

                                       5.
<PAGE>

                            SGX PHARMACEUTICALS, INC.
                            STOCK OPTION GRANT NOTICE

                                  INITIAL GRANT
                (2005 NON-EMPLOYEE DIRECTORS' STOCK OPTION PLAN)

SGX Pharmaceuticals, Inc. (the "Company"), pursuant to its 2005 Non-Employee
Directors' Stock Option Plan (the "Plan"), hereby grants to Optionholder an
option to purchase the number of shares of the Company's Common Stock set forth
below. This option is subject to all of the terms and conditions as set forth
herein and in the Stock Option Agreement, the Plan and the Notice of Exercise,
all of which are attached hereto and incorporated herein in their entirety.

Optionholder:___________________________________________________________________
Date of Grant:__________________________________________________________________
Number of Shares Subject to Option:_____________________________________________
Exercise Price (Per Share):_____________________________________________________
Total Exercise Price:___________________________________________________________
Expiration Date:       The day before the 10th anniversary of the Date of Grant

TYPE OF GRANT:         Nonstatutory Stock Option

EXERCISE SCHEDULE:     Same as Vesting Schedule

VESTING SCHEDULE:      1/36th of the shares vest each month following the Date
                       of Grant.

PAYMENT:               By one or a combination of the following items (described
                       in the Plan and/or Stock Option Agreement):

                       [ ]  By cash or check
                       [ ]  Pursuant to a Regulation T Program if the Shares are
                            publicly traded
                       [ ]  By delivery of already-owned shares if the Shares
                            are publicly traded
                       [ ]  Net exercise if the Company has adopted FAS 123, as
                            revised, at the time of such exercise

ADDITIONAL TERMS/ACKNOWLEDGEMENTS: The undersigned Optionholder acknowledges
receipt of, and understands and agrees to, this Grant Notice, the Stock Option
Agreement and the Plan. Optionholder further acknowledges that as of the Date of
Grant, this Grant Notice, the Stock Option Agreement and the Plan set forth the
entire understanding between Optionholder and the Company regarding the
acquisition of stock in the Company and supersede all prior oral and written
agreements on that subject with the exception of (i) options previously granted
and delivered to Optionholder under the Plan, and (ii) the following agreements
only:

      OTHER AGREEMENTS:                  _______________________________________
                                         _______________________________________

SGX PHARMACEUTICALS, INC.                OPTIONHOLDER:

By:___________________________________   _______________________________________
            Signature                                   Signature

Title:________________________________   Date:__________________________________

Date:_________________________________

ATTACHMENTS:     Stock Option Agreement, 2005 Non-Employee Directors' Stock
                 Option Plan and Notice of Exercise<PAGE>
                                                                   EXHIBIT 10.16

                                           *** TEXT OMITTED AND FILED SEPARATELY
                                    PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST
                                            UNDER 17 C.F.R. SECTION 200.80(b)(4)
                                               AND RULE 406 UNDER THE SECURITIES
                                                         ACT OF 1933, AS AMENDED

                                  23 JULY 2004

                           PATENT AND KNOW HOW LICENSE

                                     BETWEEN

                               SHIRE BIOCHEM INC.

                               TANAUD IRELAND INC.

                            TANAUD INTERNATIONAL B.V.

                                       AND

                            STRUCTURAL GENOMIX, INC.

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

                           PATENT AND KNOW HOW LICENSE
        Relating to the development, registration and sale of TROXATYL(R)

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

<PAGE>

PATENT AND KNOW HOW LICENSE

DATE:    23 JULY 2004

PARTIES:

(1)  SHIRE BIOCHEM INC., a company incorporated in Canada, whose address is 275
     boul. Armand-Frappier, Laval, QC, Canada H7V 4A7 ("SHIRE BIOCHEM");

(2)  TANAUD IRELAND INC., a company incorporated in Ireland, whose address is
     Shannon Airport House, Shannon, County Clare, Ireland ("TANAUD IRELAND");

(3)  TANAUD INTERNATIONAL B.V., a company incorporated in the Netherlands, whose
     address is Fred Roeskestraat 123, First Floor, 1076 EE Amsterdam, The
     Netherlands ("TANAUD BV"); and

(4)  STRUCTURAL GENOMIX, INC., a company incorporated in Delaware, whose address
     is 10505 Roselle Street, San Diego, CA 92121, U.S.A. ("LICENSEE").

BACKGROUND

(A)  Shire BioChem (formerly BioChem Pharma Inc.) is a pharmaceutical company
     engaged in, among other things, the research and development of certain
     pharmaceutical products including the Licensed Product (as defined below).

(B)  During the course of its research and development of the Licensed Product,
     Shire BioChem generated the Compound Patents, the Background Patents and
     the Shire Know-How (each defined below) in connection with the Licensed
     Product.

(C)  On 3 January 1996, Shire BioChem entered into the License Agreement (as
     defined below) which, among other things, granted Shire BioChem the
     exclusive right to use the University Patents (as defined below).

(D)  The Licensee is engaged in, among other things, the research and
     development of certain pharmaceutical products.

(E)  The Licensee has requested, and Shire agrees to grant, an exclusive license
     to make, have made, use, supply and sell the Licensed Product in the
     Territory (as defined below) on the terms and conditions set out in this
     Agreement.

OPERATIVE PROVISIONS

1.   INTERPRETATION

1.1  In this Agreement:

                                       2

<PAGE>

         "ACCELERATED APPROVAL" means approval for Marketing Authorisation of
         the Licensed Product in the United States of America on the basis of an
         application made to the FDA pursuant to the Code of Federal
         Regulations, Title 21, Part 314 (subpart H - accelerated approval of
         new drugs for serious or life threatening illnesses) or its equivalent
         in any jurisdiction;

         "AFFILIATE" means any firm, person or company which controls, is
         controlled by or is under common control with a Party to this Agreement
         and for the purpose of this definition the term "control" means the
         possession, directly or indirectly, of the power to direct or cause the
         direction of the management and policies of such firm, person or
         company, whether through the ownership of voting securities, by
         contract or otherwise or the ownership either directly or indirectly of
         more than 50% of the voting securities of such firm, person or company;

         "BACKGROUND PATENTS" means the patents and patent applications owned by
         or licensed to Shire Biochem, Tanaud Ireland or Tanaud BV as set out in
         Part I of Schedule 2;

         "BUSINESS DAY" means any day other than Saturday or Sunday on which the
         banks in New York are open for business;

         "CANADIAN TERRITORY" means Canada;

         "CHANGE OF CONTROL" means a transaction or series of related
         transactions (other than an equity financing the principal purpose of
         which is to raise new capital for the Licensee or an IPO or follow-on
         public offering), that result directly or indirectly in the change of:

         (a)      control of more than half of the voting power of the issued
                  share capital of the Licensee; or

         (b)      control of more than half of the issued share capital
                  (excluding any part thereof which carries no right to
                  participate beyond a specified amount in the distribution of
                  either profit or capital) of the Licensee; or

         (c)      control of the power to direct or cause the direction of the
                  management and policies of the Licensee, by virtue of any
                  power conferred under the articles of association or other
                  documents relating to the Licensee;

         "CLAIMS" shall have the meaning given in clause 14.1;

         "CLINICAL PROOF OF CONCEPT" means either (a) completion of the
         [...***...] patient phase II study of the Compound [...***...] Acute
         Myelogenous Leukemia (AML) patients with a complete response rate (CR
         and CRp in aggregate) [...***...] AML patients of at least [...***...]%
         with a CR rate of at least [...***...]%; or (b) continuation of such
         phase II study with additional patients or Initiation of a phase III
         study. For the purposes of this Agreement, "CR" shall have the meaning
         given to it in Journal of Clinical Oncology, Vol. 21, 2003: 4642-4649:
         "Morphologic complete remission: A CR designation requires that the
         patient achieve the morphologic leukemia-free state and have an
         absolute neutrophil count of more than 1,000/uL and platelets of
         100,000/uL. Hemoglobin concentration or hematocrit has no bearing on
         remission status, although the patient must be red cell and platelet
         transfusion

                                       3     ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

         independent (no red cell transfusion for 2 weeks and no platelet
         transfusion for 1 week). The bone marrow would have less than 5% blasts
         and no Auer rods. There is no requirement for bone marrow cellularity.
         There should be no residual evidence of extramedullary leukemia," and
         "CRp" means CR but with platelets of >25,000/uL and
         <100,000uL;

         "COMMERCIAL SALE" means any sale of the Licensed Product to a third
         party in any country in the Territory after the receipt of the
         Marketing Authorization for that country;

         "COMMITTEE MEMBERS" shall have the meaning given in clause 4.1;

         "COMPETING PRODUCT" means any pharmaceutical product (other than the
         Licensed Product) indicated for the treatment of acute myeloid leukemia
         that is marketed or near to market (phase II clinical development or
         later) which in Shire's reasonable opinion is likely to compete with
         the Licensed Product to the detriment of the Licensed Product, but
         excluding:

         (a)      any pharmaceutical product which is a kinase inhibitor owned
                  or licensed by the Licensee; and

         (b)      pharmaceutical products with scientifically documented
                  evidence, demonstrating the potential for use in combination
                  with the Licensed Product.

         "COMPOUND" means the compound troxacitabine;

         "COMPOUND PATENTS" means the patents and patent applications set out in
         Part II of Schedule 2;

         "CONFIDENTIAL INFORMATION" means any scientific, technical,
         formulation, process, manufacturing, clinical, non-clinical,
         regulatory, marketing, financial or commercial information or data
         relating to the business, projects or products of either Party and
         provided by one Party to the other by written, oral, electronic or
         other means in connection with this Agreement;

         "CONSULTANCY AGREEMENT" means the consultancy agreement dated 20
         February 1996 between BioChem Therapeutic Inc. and [...***...];

         "DEVELOPMENT COMMITTEE" means the committee set up by the Parties in
         accordance with clause 4.1;

         "DEVELOPMENT DATA" means any data, charts, studies, summaries,
         analyses, reports, know-how and other information created, generated or
         discovered in connection with the Development Plan or any other
         pre-clinical or clinical trials or studies of the Licensed Product
         conducted by or on behalf of the Licensee;

         "DEVELOPMENT PLAN" means the plan for the development of the Licensed
         Product by the Licensee as set out in Schedule 1 including the
         anticipated Timelines and development budget for the phase II study of
         the Licensed Product;

                                        4    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         "EFFECTIVE DATE" means the date of this Agreement;

         "EXCLUDED PATENTS" means the patents and patent applications identified
         in Schedule 9 which are excluded from the license granted to the
         Licensee under this Agreement;

         "FDA" means the United States Food and Drug Administration and any
         successor thereto;

         "FIELD" means all pharmaceutical uses of the Licensed Product except
         that in relation to the University Patents and University Technology,
         "Field" means the treatment of cancer only;

         "FORCE MAJEURE" means in relation to either Party any circumstances
         beyond the reasonable control of that Party;

         "GENERIC PRODUCT" means any pharmaceutical product that is recognized
         by a Regulatory Authority in a particular country in the Territory as
         "AA or AB" rated (or the equivalent rating in any jurisdiction) against
         the Licensed Product or is substitutable at the pharmacy by a
         pharmacist for a prescription written for the Licensed Product;

         "IMPROVEMENT" means any and all discoveries, developments, inventions,
         enhancements or modifications, patentable or otherwise, specifically
         relating to the Licensed Product and for use in the Field created,
         generated or discovered by or on behalf of either Party or its
         Affiliates during the term of this Agreement, but excluding the
         Development Data and any regulatory material generated in connection
         with an application for Marketing Authorization;

         "INTELLECTUAL PROPERTY RIGHTS" means patents, trade marks, service
         marks, logos, trade names, rights in designs, copyright, utility
         models, rights in know-how and other intellectual property rights, in
         each case whether registered or unregistered and including applications
         for registration, and all rights or forms of protection having
         equivalent or similar effect anywhere in the world;

         "INITIATION" means the date of first dosing of the first patient in the
         relevant clinical study;

         "IPO" means an initial public offering of the Licensee's equity
         securities for admission to listing or trading on a recognized
         securities exchange or listing or trading on a recognized securities
         market;

         "LAUNCH" means the commencement of Commercial Sale of the Licensed
         Product in any country of the Territory;

         "LICENSE AGREEMENT" means the license agreement dated 3 January 1996
         between the University of Georgia Research Foundation Inc., Yale
         University, Shire BioChem Inc. (formerly BioChem Pharma Inc.), Tanaud
         Holdings (Barbados) Limited and Tanaud LLC, as amended from time to
         time;

                                       5
<PAGE>

         "LICENSED PRODUCT" means any pharmaceutical formulations that contain
         the Compound alone as a therapeutically active ingredient, or in
         combination with any other pharmaceutically active ingredient;

         "MARKETING AUTHORIZATION" means the grant of all necessary permits,
         authorizations, licenses, approvals (including pricing and
         reimbursement approvals, if applicable) or waivers from any relevant
         Regulatory Authority required for the research, development,
         manufacture, marketing, storage, import, export, transport, use or sale
         of the Licensed Product in any country of the Territory;

         "MARKETING PLAN" means the marketing plan for the Launch, marketing and
         commercialization of the Licensed Product in each country of the
         Territory prepared in accordance with clause 6.2;

         "MEMORANDUM OF UNDERSTANDING" means a memorandum of understanding
         between the University and the Licensee substantially in the form of
         Schedule 7;

         "MINIMUM SALES FORECASTS" means [...***...]% of the [...***...];
         [...***...]% of the [...***...]; [...***...]% of the [...***...]; and
         [...***...]% of the [...***...];

         "MILESTONE EVENT" means the event identified in Schedule 3 which
         triggers a payment under clause 7.2;

         "MILESTONE PAYMENT" means the payment by the Licensee to Shire of the
         sums identified in Schedule 3 on the occurrence of a Milestone Event;

         "MILESTONE PAYMENT TERMS" means the payment of any Milestone Payment or
         other applicable payment under clause 7, to Shire as follows:
         [...***...]% of such payment to Tanaud Ireland; [...***...]% of such
         payment to Tanaud BV; and [...***...]% of such payment to Shire
         BioChem;

         "NDA" means a new drug application and all supplements filed with the
         FDA, including all documents, data and other information concerning the
         Licensed Product which are necessary for, or included in, a Marketing
         Authorization to use, sell, supply or market the Licensed Product in
         the United States of America;

         "NET SALES" means the gross amount invoiced by the Licensee, its
         Affiliates or Sub-Licensees to third parties in respect of sales of the
         Licensed Product, less:

         (a)      trade, quantity and cash discounts or rebates actually allowed
                  and taken, provided that such discounts or rebates are not
                  applied disproportionately to the Licensed Product as compared
                  with similar products of the selling entity, including those
                  granted for rejected, damaged and recalled goods;

         (b)      freight, shipping and related insurance charges, provided that
                  such charges are no more than 1% of Net Sales;

                                       6     ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         (c)      tax, tariff or customs duties or other government duties
                  (other than income tax) levied on the sale, transportation or
                  delivery of the Licensed Product; and

         (d)      credits, rebates, charge backs or similar payments granted or
                  given to wholesalers or other third party distributors, health
                  care insurance carriers, pharmacy benefit management companies
                  or health care organizations.

                  For the avoidance of doubt, sales or other transfers between
         the Licensee and its Affiliates or its Sub-Licensees are not sales to
         third parties, but Net Sales shall include any subsequent sales of the
         Licensed Product by such Affiliates or Sub-Licensees to any third
         parties. Where the Licensed Product is sold otherwise than on an arms
         length basis, the amount that would have been charged in an arms length
         sale shall be deemed to be the invoice price for such Licensed Product
         and where the Licensed Product is disposed of for consideration other
         than cash, such consideration shall be valued at the fair market value.

         "OTHER TERRITORIES" means throughout the world, except for the Canadian
         Territory and the US Territory;

         "PARTY" AND "PARTIES" means respectively Shire or the Licensee, or as
         the case may be, both such parties;

         "PREMIUM ON EQUITY" means in relation to the acquisition by any third
         party of any equity (or any form of security convertible into equity)
         in the Licensee or its Affiliates in connection with any Sub-License
         Agreement, the excess of actual purchase price paid for such equity
         over the fair market value of such equity. For clarity, if the fair
         market value of the equity is $8.00 and the amount paid by the third
         party is $10.00, the Premium on Equity is $2.00. Any dispute over the
         fair market value of the Licensee's stock shall be resolved through the
         dispute resolution procedure set out in clause 24.2;

         "PRINCIPAL MARKETS" means the United States of America, Canada, Japan,
         the United Kingdom, Germany, France, Italy and Spain;

         "QUARTER" means a three month period ending on the last day of March,
         June, September or December in any calendar year;

         "REASONABLE COMMERCIAL EFFORTS" means commercial efforts consistent
         with normal business practices and effort used by the Licensee in
         connection with other products of similar market size or importance
         which the Licensee intends to launch or has launched and sold in the
         Territory, or in the absence of any such similar products then such
         effort shall be assessed by reference to good business practice in the
         light of all the circumstances;

         "REGULATORY AUTHORITY" means any competent government agency,
         regulatory authority or other administrative body responsible for
         granting Marketing Authorization in a particular country or
         multinational group of countries in the Territory, including the FDA;

         "REMEDIES" shall have the meaning given in clause 12.2;

                                       7
<PAGE>

         "SALES FORECASTS" means the sales of the Licensed Product anticipated
         by the Licensee for a 4 year period from Launch of the Licensed Product
         in the US Territory as set out in Schedule 4;

         "SEC" means the Securities Exchange Commission in the United States of
         America and any successor thereto;

         "SHIRE" means Shire BioChem, Tanaud Ireland or Tanaud BV or
         collectively Shire BioChem, Tanaud Ireland and Tanaud BV as the case
         may be;

         "SHIRE INTELLECTUAL PROPERTY" means the Shire Patents, the University
         Patents, University Technology and the Shire Know-How;

         "SHIRE KNOW-HOW" means all information, procedures, instructions,
         techniques, data, technical information (including toxicological,
         pharmaceutical, non-clinical, clinical and medical data, health
         registration data and marketing data), processing specifications,
         pricing studies and market evaluation materials owned by Shire or its
         Affiliates (other than Shire Laboratories Inc.) and reasonably
         necessary for the development, or in the case of pricing and market
         evaluation materials, for commercialization, of the Licensed Product in
         the Territory;

         "SHIRE MATERIALS" means the Compound and other materials identified in
         Schedule 5;

         "SHIRE PATENTS" means the Compound Patents and Background Patents and
         including, in each case, any divisionals, extensions, reissues,
         substitutions, renewals, continuations, continuations-in-part,
         provisionals, re-examinations and foreign counterparts thereof
         (including European supplementary protection certificates) and patents
         issuing thereon;

         "SUB-LICENSEE" means any non-Affiliate third party sub-licensee of the
         rights (or any part of the rights) granted to the Licensee under this
         Agreement;

         "SUB-LICENSE AGREEMENT" means any agreement between the Licensee and
         the Sub-Licensee granting the right or license under the Shire
         Intellectual Property (or any part of it) to develop, manufacture, have
         manufactured, use, sell, offer for sale, import or supply the Licensed
         Product;

         "SUB-LICENSE INCOME" means any consideration in any form received by
         the Licensee or its Affiliates in connection with a Sub-License
         Agreement, but excluding royalties on Net Sales and amounts received
         under arms length non-convertible debt instruments negotiated on
         standard commercial terms, including (a) upfront fees, milestone
         payments, license maintenance fees, distribution or joint marketing
         fees, development funding (in excess of the Licensee's cost of
         performing such development), and any investment in the Licensee, and
         (b) exchange products, cross-licensed products, options, marketing
         rights and such other forms of non-cash consideration that may be
         deemed to have value;

         "SUB-LICENSEE MOU" means a memorandum of understanding between Shire
         and a Sub-Licensee substantially in the form of Schedule 7;

                                       8
<PAGE>

       "TERRITORY" means the Canadian Territory, the US Territory and the Other
       Territories;

       "THIRD PARTY ACTION" shall have the meaning given in clause 13.1;

       "TIMELINES" means the timelines for the research, development,
       registration and Launch of the Licensed Product as set out in the
       Development Plan;

       "TRADE MARKS" means the trade marks and applications for trade marks set
       out in Schedule 6;

       "UNIVERSITY" means each of the University of Georgia Research Foundation
       Inc. and Yale University;

       "UNIVERSITY PATENTS" means the patents and patent applications set out in
       Part III of Schedule 2 and including, any divisionals, extensions,
       reissues, re-examinations, continuations, and foreign counterparts
       thereof and patents issuing thereon;

       "UNIVERSITY TECHNOLOGY" means the "Licensed Technology" as defined in the
       License Agreement; and

       "US TERRITORY" means the United States of America and its territories and
       possessions.

1.2    In this Agreement, unless the context requires otherwise:

       (a)    the headings are included for convenience only and shall not
              affect its construction;

       (b)    references to "persons" includes individuals, bodies corporate
              (wherever incorporated), unincorporated associations and
              partnerships;

       (c)    words denoting the singular shall include the plural and vice
              versa;

       (d)    references to the word "including" are to be construed without
              limitation;

       (e)    words denoting one gender shall include each gender and all
              genders; and

       (f)    any reference to an enactment or statutory provision is a
              reference to it as it may have been, or may from time to time be
              amended, modified, consolidated or re-enacted.

1.3    The Schedules comprise part of and shall be construed in accordance with
       the terms of this Agreement. In the event of any inconsistency between
       the Schedules and the terms of this Agreement, the terms of this
       Agreement shall prevail.

2.     GRANT OF LICENSE

2.1    Subject to the terms of this Agreement, Shire hereby grants the Licensee:

                                       9
<PAGE>

       (a)    an exclusive license under the Shire Patents and Shire Know-How to
              develop, manufacture, have manufactured, use, sell, offer for
              sale, import and supply the Licensed Product in the Territory and
              in the Field; and

       (b)    an exclusive sub-license under the University Patents and
              University Technology to develop, manufacture, have manufactured,
              use, sell, offer for sale, import and supply the Licensed Product
              in the Territory and in the Field.

2.2    Except to the extent necessary to enable Shire to perform its obligations
       under this Agreement and subject to the terms of the License Agreement
       (and in particular the University's rights under Articles 2.2 and 2.4 of
       the License Agreement) the term "exclusive" for the purposes of clause
       2.1, means to the exclusion of all others, including Shire and its
       Affiliates.

2.3    This Agreement and the grant of any license pursuant to clauses 2.1 and
       10.1 shall in all respects be conditional upon the Licensee receiving
       US$12 million in cash from its investors and providing documentary
       evidence, to Shire's reasonable satisfaction, of receipt of such sum by
       no later than September 30, 2004. If such condition subsequent is not
       fulfilled (or waived) on or before September 30, 2004, this Agreement
       shall automatically terminate, Shire shall be entitled to retain any
       upfront payment received and neither party shall have a claim of any
       nature whatsoever against the other party under this Agreement (except in
       respect of any rights or liabilities of the parties which have accrued
       prior to termination).

2.4    The Licensee undertakes to:

       (a)    use all reasonable efforts to ensure that the condition subsequent
              in clause 2.3 is fulfilled as soon as reasonably practicable and
              in any event by September 30, 2004; and

       (b)    keep Shire informed of the progress towards satisfaction of such
              condition precedent and in particular promptly disclose in writing
              to Shire anything which will or may prevent the condition
              subsequent from being satisfied.

3.     SUB-LICENSING

3.1    The Licensee shall have the right to sub-license the rights granted under
       this Agreement to its Affiliates or any third party, provided that:

       (a)    the Licensee provides Shire the opportunity to review the
              Sub-License Agreement (which, subject to the disclosure to the
              University to the extent required under the License Agreement and
              subject to the Universities' confidentiality obligations
              thereunder, Shire shall treat as Confidential Information of the
              Licensee) prior to its execution and considers in good faith any
              reasonable amendments to the Sub-License Agreement requested by
              Shire and subject to clause 3.1A, shall obtain the University's
              prior consent (such consent not be unreasonably withheld or
              delayed);

                                       10
<PAGE>
       (b)    any Sub-License Agreement shall be in writing and, with the
              exception of the financial terms, be consistent with the terms of
              this Agreement (except that the Sub-Licensee shall not have the
              right to sub-license, unless Shire and the University have
              consented to such right, which consent, if requested by the
              Licensee, shall not be unreasonably withheld or delayed); and

       (c)    the Licensee shall remain responsible to Shire with respect to all
              the operations of its Sub-Licensee relevant to the use Licensed
              Product under this Agreement as if such operations were carried
              out by the Licensee, including the provision of Reasonable
              Commercial Efforts in the development, manufacture, registration
              and Launch of the Licensed Product, the making of any payments
              under this Agreement, the provision of indemnities, the provision
              of insurance and compliance with applicable law.

3.1A   The Licensee may enter into a Sublicense Agreement without the prior
       consent of the University if:

       (a)    the relevant territory of the Sub-License Agreement is outside the
              Principal Markets; or

       (b)    the relevant territory of the Sub-License Agreement is within the
              Principal Markets, provided that, the Sub-Licensee, at the time of
              grant:

              (i)    is listed on a recognized securities exchange and has
                     market capitalization of not less than U.S.$ [...***...]
                     million, or is a private company with cash of not less than
                     U.S.$ [...***...] million; and

              (ii)   has a current marketing authorization for at least one
                     other regulatory-approved pharmaceutical oncology product
                     in any country in the Principal Markets prior to the date
                     of the Sub-License Agreement.

3.2    Shire shall use reasonable endeavours to procure that the University
       signs a Memorandum of Understanding, and shall provide the same to the
       Licensee on the Effective Date for countersignature by the Licensee. Upon
       request by the Licensee, Shire shall consent (which consent shall not be
       unreasonably withheld or delayed) to signing a Sub-Licensee MOU, provided
       that, the reason for the termination of this Agreement does not relate in
       any way to any act or omission of the Sub-Licensee, its Affiliates,
       representatives or sub-licensees.

3.3    In the event that the Licensee enters a Sub-License Agreement pursuant to
       clause 3.1, the Licensee shall promptly after execution of such
       Sub-License Agreement, provide Shire with a copy of the final form of the
       Sub-License Agreement, which Shire shall treat as Confidential
       Information of Licensee.

3.4    The Licensee shall not, and shall procure that its Affiliates and
       Sub-Licensees shall not:

       (a)    utilize any part of the Shire Intellectual Property in the making
              of any patent application, except as otherwise agreed in writing
              by the Parties pursuant to the terms of this Agreement; or

                                       11    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         (b)      manufacture, supply, market or sell, or knowingly assist any
                  third party to manufacture, supply, market or sell any
                  Competing Product anywhere in the Territory; unless in the
                  event of a Change of Control of Licensee, the new controlling
                  party has a Competing Product and Shire does not terminate the
                  Agreement pursuant to clause 19.2(c), in which event, this
                  sub-clause 3.3(b) shall not apply.

3.5    Shire agrees not to terminate the License Agreement without the prior
       written consent of the Licensee (which consent shall not be unreasonably
       withheld or delayed). Shire further agrees that within 5 Business Days
       after a request from Licensee, Shire shall provide the University with
       the written notice under clause 2.2(a) of the Memorandum of
       Understanding, provided that the reason for the termination of the
       License Agreement by the University does not relate in any way to any act
       or omission of the Licensee, its Affiliates, representatives or
       Sub-Licensees.

4.     THE DEVELOPMENT COMMITTEE

4.1    The Parties shall establish a Development Committee consisting of 4
       individuals ("COMMITTEE MEMBERS"); 2 of whom shall be nominated by Shire;
       and 2 of whom shall be nominated by the Licensee. Either Party may
       replace its Committee Members by notice to the other Party. The Committee
       Members shall be appropriately qualified and experienced in order to make
       a meaningful contribution to Development Committee meetings.

4.2    The purpose of the Development Committee is to provide a forum for the
       Parties to share information and knowledge on the on-going research,
       development and commercialisation of the Licensed Product including
       monitoring the progress of non-clinical and clinical studies, reviewing
       clinical trial programmes, considering proposed regulatory filings,
       Launch plans, marketing and promotional plans, reviewing competitor
       activity and discussing any regulatory, technical, quality assurance or
       safety issues in relation to the Licensed Product. The Development
       Committee shall conduct its discussions in good faith with a view to
       operating to the mutual benefit of the Parties and in furtherance of the
       successful development and commercialisation of the Licensed Product.

4.3    The Development Committee shall meet as often as the Committee Members
       may determine, but in any event not less than once per calendar year. The
       Committee Members may invite individuals with special skills to attend
       such meetings where it is considered to be relevant and appropriate. The
       quorum for Development Committee meetings shall be 2 Committee Members,
       comprising 1 Committee Member from each Party.

5.     DEVELOPMENT AND MARKETING AUTHORIZATIONS

5.1    Shire shall use reasonable efforts within 90 days from the Effective
       Date:

       (a)    to deliver to the Licensee (or its nominee) the Shire Know-How to
              the extent that it is reasonably necessary for the research and
              development of the Licensed Product by the Licensee in accordance
              with the Development Plan, the University Technology under Shire's
              possession or control;

       (b)    to deliver to the Licensee (or its nominee) the Shire Materials;

                                       12
<PAGE>

       (c)    transfer the investigational new drug application (filed with the
              FDA) relating to the development and use of Licensed Product to
              the Licensee; and

       (d)    transfer its rights and obligations to the Licensee under the
              clinical research services agreements relating to the phase I
              clinical studies ([...***...] and [...***...]) of the Licensed
              Product between Shire Pharmaceutical Development Inc. and
              Quintiles Inc. From the Effective Date, the Licensee shall bear
              the cost of and risk in such phase I studies.

5.2    For a period of 3 months following the Effective Date, Shire shall
       provide the Licensee with a reasonable amount of access during normal
       business hours to [...***...], and [...***...], as is reasonably
       necessary to teach the Shire Know-How to the Licensee, provided that, the
       personnel remain employed or engaged by Shire and such access is limited
       to no more than an aggregate of 25 person working days and no more than 2
       working days in any working week. Shire shall not terminate the
       employment or engagement of any of the above personnel for 3 months
       following the Effective Date. Shire shall promptly inform the Licensee
       if, during such period, any of the relevant personnel cease to work for
       Shire. In the event that the Licensee requires additional access to Shire
       personnel, the Parties shall in good faith negotiate the cost to the
       Licensee of such access.

5.3    The Licensee shall:

       (a)    at [...***...], use its Reasonable Commercial Efforts to perform,
              or procure the performance of, the activities and services in the
              Development Plan;

       (b)    perform, or procure the performance of, any such activities and
              services with reasonable care and skill and ensure that personnel
              employed or engaged by it in the provision of any such activities
              and services are competent and have appropriate professional
              qualifications, training and experience;

       (c)    complete the Development Plan as expeditiously as reasonably
              possible using its Reasonable Commercial Efforts to meet and
              comply with the Timelines; and

       (d)    update Shire at regular intervals, to be agreed between the
              Parties, on the progress of the Development Plan and submit a
              written report to Shire and the University every [...***...] as
              soon as reasonably practicable after [...***...] of each year and
              in any event by [...***...] respectively, detailing its progress
              of the research, development, registration and commercialisation
              of the Licensed Product and the amount of direct expenditures
              associated with the development of the Licensed Product for the
              previous [...***...] months.

5.4    Upon completion of the Development Plan, the Licensee shall, at
       [...***...], use, or cause its Affiliates and Sub-Licensees to use,
       Reasonable Commercial Efforts to prepare, file, prosecute and maintain
       all applications for Marketing Authorization and any other necessary
       licenses, permits, authorizations and approvals (or waivers) required by
       any Regulatory Authority for the Launch, use, promotion, import, sale,
       distribution or commercialisation of the Licensed Product in the
       Principal Markets. The Licensee shall file its application for

                                         13  ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

       NDA in the United States of America no later than [...***...] following
       completion of the Development Plan with respect to that country.

6.     LAUNCH AND MARKETING EFFORTS

6.1    The Licensee shall, at [...***...] use its Reasonable Commercial Efforts,
       or procure that its Affiliates or Sub-Licensees use their Reasonable
       Commercial Efforts, to:

       (a)    Launch the Licensed Product in the Principal Markets as soon as
              reasonably practicable following receipt of Marketing
              Authorization in the relevant country and in any event Launch the
              Licensed Product no later than [...***...] following receipt of
              Marketing Authorization in such country; and

       (b)    research, develop, manufacture, distribute and sell, or cause its
              Affiliates or Sub-Licensees (except for third party contract
              research organisations or pharmaceutical manufacturers) to
              research, develop, manufacture, distribute and sell the Licensed
              Product in the Principal Markets.

6.2    The Licensee shall, within [...***...] from filing the NDA for the
       Licensed Product, provide the Development Committee with its Marketing
       Plan setting out its strategy for the Launch of the Licensed Product
       including revised Sales Forecasts (if applicable), anticipated pricing
       levels and reimbursement levels, if appropriate, and marketing and
       promotion plans and spend, in relation to the Licensed Product for the
       calendar year following approval of the NDA. Thereafter, and on or before
       31 October of each calendar year, the Licensee shall provide the
       Development Committee with its Marketing Plan for the next calendar year.
       Each Marketing Plan shall include net sales targets, projections with
       respect to sales force staffing levels, marketing research strategies,
       marketing and promotion plans, physician education plans and general
       advertising and related budgets for sales of the Licensed Product in the
       relevant calendar year.

6.3    Licensee shall:

       (a)    perform, or procure the performance of, the activities set out in
              the Marketing Plan;

       (b)    use Reasonable Commercial Efforts to meet the Sales Forecasts; and

       (c)    on reasonable request from Shire, provide it with copies of the
              packaging, packaging inserts and any advertising or promotional
              materials (including translations, if necessary) used in
              connection with the sale of the Licensed Product in the Territory.

6.4    The Licensee acknowledges that the Sales Forecasts are its good faith
       estimates of sales of the Licensed Product in the Territory based on
       information available to the Licensee at the Effective Date.

6.5    The Licensee may, on submitting the first Marketing Plan and subject to
       the terms of this Agreement, revise the Sales Forecasts. Any reduction in
       the Sales Forecasts must be based on the following:

                                         14  ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

       (a)    an unexpected and materially adverse change in the market for the
              Licensed Product in the Territory;

       (b)    unexpected clinical data generated from the Development Plan or an
              unexpected pricing decision from a Regulatory Authority which, in
              each case, has an adverse effect on the anticipated sales of the
              Licensed Product; or

       (c)    advice from a Regulatory Authority which specifies restrictions to
              the use of the Licensed Product that reduces the anticipated
              market for the Licensed Product in the Territory.

6.6    Notwithstanding anything contained in clause 6.5, any such reduction in
       the Sales Forecast in the first Marketing Plan must:

       (a)    be supported by a written report explaining, to Shire's reasonable
              satisfaction, the reasons for such reduction;

       (b)    not be due to reasons which could have reasonably been foreseen by
              the Licensee at the Effective Date and shall not, in any event, be
              less than the [...***...] identified at the Effective Date; and

       (c)    be more than [...***...]% of the initial Sales Forecast before the
              Licensee shall be entitled to seek such a reduction.

6.7    In the event that the Licensee fails to meet a Minimum Sales Forecasts in
       any calendar year, the Licensee shall pay Shire, within 30 days from the
       end of the relevant calendar year, an additional payment representing
       [...***...] that [...***...] on the [...***...] the [...***...] for the
       [...***...] and the [...***...].

7.     ROYALTY AND MILESTONE PAYMENTS

7.1    In consideration of the rights granted under this Agreement, the Licensee
       shall pay Shire (or its nominee) the non-creditable and non-refundable
       sum of US$3 million within 3 Business Days from the Effective Date and
       the non-creditable and non-refundable sum of US$1 million within 5
       Business Days of the first anniversary of the Effective Date, in
       accordance with the Milestone Payment Terms.

7.2    Upon the occurrence of each Milestone Event, the corresponding
       non-refundable Milestone Payment shall be made by the Licensee to Shire
       in accordance with the Milestone Payment Terms. For the avoidance of
       doubt, each Milestone Payment shall be made no more than once with
       respect to the achievement of a Milestone Event, but shall be payable the
       first time the Milestone Event is achieved. [...***...]% of any
       development Milestone Payments (but not sales Milestone Payments) shall
       be creditable against royalties due to Shire under sub-clauses 7.3(a),
       7.3(b), 7.3(c), 7.3(d) (but not royalties under sub-clause 7.3(e)), and
       if applicable, sub-clauses 7.4(a), 7.4(b), 7.4(c), 7.4(d) (but not
       royalties under sub-clause 7.4(e)), provided that, in no event will the
       credit for such development Milestone Payments reduce the royalties
       payable to Shire in any Quarter by more than [...***...]%. Any amount
       that has not been so credited

                                       15    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

       may be credited against royalties due in subsequent Quarters, subject to
       the limitation described in the previous sentence. For the avoidance of
       doubt, upon expiry or termination of this Agreement, Shire shall not be
       liable to the Licensee for any credit amount accrued and not credited.

7.3    Subject to clauses 7.4, 7.7(b) and 8.2, during the term of this
       Agreement, the Licensee shall pay Shire:

       (a)    a royalty of [...***...]% of the first US$[...***...] of Net Sales
              of the Licensed Product in the Territory in any calendar year;

       (b)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] and up to US$[...***...] in the Territory in any
              calendar year;

       (c)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] and up to US$[...***...] in the Territory in any
              calendar year;

       (d)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] in the Territory in any calendar year; and

       (e)    any royalties or other payments to be made by Shire or its
              Affiliates under the License Agreement or the Consultancy
              Agreement, incurred after the Effective Date, other than payments
              under Articles 4.5 and 4.6 of the License Agreement. [...***...]%
              of any payments made by the Licensee for milestone payments
              properly paid by the Licensee under Article 4.2(c) of the License
              Agreement shall be creditable against royalties in accordance with
              clause 7.2 above.

7.4    At any time during calendar year [...***...], Licensee shall have the
       right to pay to Shire the non-creditable and non-refundable sum of
       US$[...***...] in accordance with the Milestone Payment Terms and in such
       event, Licensee shall have no obligation to make any payments to Shire
       under clause 7.3, but instead shall pay Shire the following:

       (a)    a royalty of [...***...]% of the first US$[...***...] of Net Sales
              of the Licensed Product in the Territory in any calendar year;

       (b)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] and up to US$[...***...] in the Territory in any
              calendar year;

       (c)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] and up to US$[...***...] in the Territory in any
              calendar year;

       (d)    a royalty of [...***...]% of any Net Sales in excess of
              US$[...***...] in the Territory in any calendar year; and

       (e)    any royalties or other payments to be made by Shire or its
              Affiliates under the License Agreement or the Consultancy
              Agreement, incurred after the Effective Date, other than payments
              under Articles 4.5 and 4.6 of the License Agreement.

                                       16    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

7.5    In the event that the Licensee supplies a Licensed Product to any
       customer as part of a package or combination of products, then the Net
       Sales of the Licensed Product shall be whichever is the higher of:

       (a)    the fair market value of such Licensed Product when sold by
              itself; or

       (b)    the proportion of the selling price of such package of products
              which is reasonably attributable to the Licensed Product.

7.6    For the purposes of clause 7.5, fair market value means the value of
       Licensed Product sold to similar customers in the Territory with similar
       pricing and reimbursement structures and for similar quantities. Any
       dispute as to the determination of fair market value or proportion of the
       selling price of a package of products attributable to the Licensed
       Product shall be resolved through the dispute resolution procedure set
       out in clause 24.2.

7.7    Subject to clauses 7.9 and 8.2, in the event that Licensee or its
       Affiliates enters into a Sub-License Agreement in any Territory, then
       Licensee shall pay to Shire in addition to the Milestone Payments:

       (a)    subject to clause 7.10, [...***...]% of any Sub-License Income;
              and

       (b)    in lieu of royalties under clauses 7.3 or 7.4 applicable to Net
              Sales by such Sub-Licensee in its particular territory, the
              greater of:

              (i)    [...***...]% of any royalty payments received by Licensee
                     or its Affiliates from the Sub-Licensee or its Affiliates
                     for sales of Licensed Products by or on behalf of the
                     Sub-Licensee; or

              (ii)   [...***...]% of Net Sales by the Sub-Licensee and its
                     Affiliates.

7.8    In the event that Sub-License Income corresponds to a Milestone Payment
       under this Agreement which has not already been paid by the Licensee and
       such Sub-License Income is greater than the respective Milestone Payment,
       the Licensee shall pay Shire on the occurrence of the Milestone Event the
       full Milestone Payment plus [...***...]% of the difference between the
       Sub-License Income and the relevant Milestone Payment.

7.9    In addition to any payments made by the Licensee under clause 7.7, the
       Licensee shall pay any royalties or other payments to be made by Shire or
       its Affiliates under the License Agreement and the Consultancy Agreement,
       incurred after the Effective Date, other than payments under Articles 4.5
       and 4.6 of the License Agreement.

7.10   In the event that the Licensee or its Affiliates receives any Sub-License
       Income by way of cash consideration in relation to the acquisition of
       equity (or any form of security convertible into equity) in the Licensee
       or its Affiliates or non-cash consideration upon which payment would be
       due to Shire under clause 7.7, the Licensee shall pay Shire:

       (a)    in relation to the acquisition of equity (or any form of security
              convertible into equity) in the Licensee or its Affiliates the
              greater of:

                                       17    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

              (i)    [...***...]% of the Premium on Equity; or

              (ii)   [...***...]% of the total amount received or to be received
                     by the Licensee or its Affiliates; or

       (b)    in relation to the payment of non-cash consideration, [...***...]%
              of the fair market cash value of such non-cash consideration at
              the date of receipt of the non-cash consideration by the Licensee
              or its Affiliate.

8.     PAYMENT TERMS

8.1    Unless otherwise expressly stated, payments due under this Agreement
       shall be made by the Licensee to Shire (or its nominee) as follows:

       (a)    in respect of any development Milestone Payments, within
              [...***...] days from identification of the occurrence of the
              development Milestone Event by the Licensee;

       (b)    in respect of any sales Milestone Payments, within [...***...]
              days from the end of the Quarter in which the relevant Milestone
              Event occurred;

       (c)    in respect of Net Sales royalty payments during any Quarter,
              within [...***...] days from the end of that Quarter;

       (d)    in respect of any payments under clause 7.7, within [...***...]
              days from receipt of the Sub-Licensing Income by the Licensee or
              its Affiliates from the Sub-Licensee, or in relation to royalties
              on Net Sales within [...***...] days from the end of the relevant
              Quarter; and

       (e)    in respect of any payments to be made under the License Agreement
              during any Quarter, within [...***...] days from the end of the
              Quarter.

8.2    The payment of all Net Sales royalty revenue from the Licensee, its
       Affiliates or its Sub-Licensees, to Shire shall:

       (a)    in respect of sales of the Licensed Product in the US Territory,
              be paid to Tanaud Ireland;

       (b)    in respect of sales of the Licensed Product in the Canadian
              Territory, be paid to Shire BioChem; and

       (c)    in respect of sales of the Licensed Product in the Other
              Territories, be paid to Tanaud BV.

8.3      All payment sums due under this Agreement to Shire shall be paid in US
         dollars. Net Sales shall be determined in the currency in which the
         Licensed Product was sold and shall be converted into US dollars using
         the spot rate on the last day of the relevant Quarter as

                                       18    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

       published by the Wall Street Journal for the relevant Quarter for which
       such payment is being determined.

8.4    At the same time as payment of any Net Sales royalty falls due, the
       Licensee shall submit to Shire a statement in writing recording the
       calculation of the amounts payable and including:

       (a)    the number of Licensed Products which have been supplied in each
              country of the Territory during the previous Quarter;

       (b)    the Net Sales generated in each country of the Territory during
              the previous Quarter; and

       (c)    the amount of royalties due and payable to Shire in relation to
              sales of the Licensed Product in the US Territory, the Canadian
              Territory, the Other Territories, and the Territory as a whole
              (including where appropriate the exchange rate used).

8.5    Interest shall be payable by the Licensee on any amounts payable to Shire
       under this Agreement which are not paid by the due date for payment. All
       interest shall accrue and be calculated on a daily basis (both before and
       after any judgment) at the rate of [...***...]% per annum above the base
       rate of Barclays Bank plc from time to time, for the period from the due
       date for payment until the date of actual payment.

8.6    Notwithstanding any other provision of this Agreement, if at any time
       legal restrictions prevent the prompt remittance of part or all of the
       payments required hereunder in any country, payment shall be made through
       such lawful means as Shire may determine.

8.7    Any tax that the Licensee, its Affiliates or Sub-Licensees are required
       to withhold to comply with relevant laws with respect to the royalties
       and other payments due under this Agreement, shall be deducted from said
       payments prior to remittance; provided, however, that in regard to any
       tax so deducted, the Licensee shall give or cause to be given to Shire
       such assistance, including documentary evidence, as may reasonably be
       necessary to enable Shire to claim exemption therefrom or credit
       therefor, and in each case, the Licensee shall furnish to Shire proper
       evidence of the taxes paid on its behalf. Unless otherwise expressly
       stated, all sums due under this Agreement shall be paid without
       deduction, set-off or counterclaim.

8.8    The obligation of the Licensee to pay royalties and any other payments
       due under this Agreement, shall continue on a country-by-country basis
       for the term of this Agreement. Subject to clause 8.9, in the event that
       there are no issued Shire Patents or University Patents covering the use
       of the Licensed Product in a country in the Territory, the royalty
       payments due to Shire (but not those due to the University under the
       License Agreement) for Net Sales in such country shall be reduced by
       [...***...]%, provided that:

       (a)    one or more Generic Products have been granted marketing
              authorization and are being sold in such country; and

                                       18    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

       (b)    IMS data demonstrates that the market share for the Licensed
              Product in such country has been reduced by [...***...]% or more
              in any two consecutive Quarters following the launch of the
              Generic Product in such country.

8.9    In the event that after the grant of marketing authorization of the
       Generic Product any Shire Patent or University Patent application is
       issued, and such patent is able to prevent the sale of the Generic
       Product in the relevant country the royalty payments due to Shire for Net
       Sales in such country shall return to the royalty rates set out in clause
       7.3 or 7.4 as applicable.

9.     RECORDS AND REPORTS

9.1    During the term of this Agreement, and for a period of [...***...] years
       after its expiry or termination, the Licensee shall, and shall procure
       that its Affiliates and Sub-Licensees shall, keep at its or their normal
       place of business detailed, accurate and up to date records and books of
       account showing the sales of the Licensed Product in each country in the
       Territory sufficient to ascertain:

       (c)    any Net Sales generated in connection with the sale of the
              Licensed Product and royalties payable to Shire under this
              Agreement; and

       (d)    the achievement or progress towards achievement of any Milestone
              Event, provided that, in the event that the Milestone Event
              relates to the development of the Licensed Product, the Licensee
              has failed to meet the Timelines and, in Shire's reasonable
              opinion, the Licensee has failed to adequately explain the reasons
              for the delay.

9.2    On no less than [...***...] Business Days notice from Shire, the Licensee
       shall make, or procure that its Affiliates or Sub-Licensees make, such
       records and books of account available for inspection by Shire (or its
       nominee) for the purpose of audit to confirm payments due under this
       Agreement, but not more than [...***...] in any calendar year in relation
       to royalties payable to Shire under this Agreement and not more than
       [...***...] in any calendar year in relation to the achievement of any
       Milestone Event. Shire (or its nominee) shall be entitled to take copies
       or extracts from such records or books of account during any such review
       or audit.

9.3    Shire shall be solely responsible for its costs and expenses in making
       any such review or audit, unless Shire identifies a discrepancy in the
       sums paid in any calendar year from those payable under this Agreement
       for that calendar year of greater than [...***...]%, in which event the
       Licensee shall pay Shire's costs and expenses incurred in connection with
       the review or audit, and make good the deficit in the payments (including
       any interest amount calculated in accordance with clause 8.5).

9.4    All information disclosed by the Licensee, its Affiliates or its
       Sub-Licensees pursuant to this clause 9 shall be deemed Confidential
       Information of Licensee, its Affiliates or its Sub-Licensees, as
       applicable.

                                       20    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

10.      TRADE MARKS

10.1     Shire hereby grants the Licensee an exclusive license, with the right
         to sublicense, to use the Trade Marks in relation to the sale,
         promotion and marketing of the Licensed Product in the Territory for
         the term of this Agreement. The Licensee shall:

         (a)      use the Trade Marks only in a manner which conforms to the
                  reasonable directions and standards notified to it by Shire
                  from time to time;

         (b)      market the Licensed Product throughout the Territory under the
                  Trade Marks and ensure that all marketing materials for the
                  Product shall display the Trade Marks;

         (c)      not use, register or attempt to register any trade marks,
                  company, business or trading names or domain names which are
                  identical or similar to (or which incorporate) any of the
                  Trade Marks, any aspect of them, or any other trade marks or
                  trade names used by Shire, without Shire's prior written
                  consent; and

         (d)      not do anything which could, in Shire's reasonable opinion,
                  bring the Trade Marks or Shire into disrepute or which could
                  otherwise damage the goodwill attaching to the Trade Marks or
                  any other trade marks or trade names of Shire.

10.2     Shire shall, [...***...], maintain the registrations for the Trade
         Marks, and shall use reasonable efforts to prosecute any applications
         for registration of the Trade Marks through to grant in the Territory.

10.3     The Licensee acknowledges that:

         (a)      it shall not acquire, nor claim, any right, title or interest
                  in or to any of the Trade Marks or the goodwill attaching to
                  them by virtue of this Agreement or its use of the Trade
                  Marks, other than the rights specifically granted to it under
                  clause 10.1; and

         (b)      all goodwill arising from use of the Trade Marks by the
                  Licensee before, during or after the term of this Agreement
                  shall accrue and belong to Shire, and the Licensee shall, at
                  Shire's request and cost, promptly execute all documents
                  required by Shire to confirm this.

11.      INTELLECTUAL PROPERTY, IMPROVEMENTS AND PATENTS

11.1     Except as set out in this Agreement and the License Agreement, all
         right, title and interest in the Shire Intellectual Property and the
         Trade Marks shall belong to Shire, and the Licensee shall not have any
         right, title or interest in the Shire Intellectual Property or the
         Trade Marks.

11.2     All Intellectual Property Rights in the Development Data shall belong
         to the Licensee. The Licensee shall disclose reasonably detailed
         summaries of the Development Data to Shire through the Development
         Committee.

11.3     Shire shall, at its sole option, file, prosecute, maintain or extend
         the Shire Patents. Subject to the terms of the License Agreement, Shire
         shall:

                                       21    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

         (a)      keep the Licensee reasonably informed of any material
                  developments or notices in connection with the prosecution of
                  any Shire Patents or University Patent applications, but only
                  to the extent that the material developments or notices relate
                  to the Licensed Product;

         (b)      give the Licensee a reasonable opportunity to comment on any
                  Shire response to such developments or notices that are
                  intended to be filed in any patent office in relation to the
                  Compound Patents and consider in good faith any such comments;
                  and

         (c)      give the Licensee a reasonable opportunity to liaise and
                  cooperate with the University in the prosecution and
                  maintenance of the University Patents.

11.4     Any expenses incurred after the Effective Date in the filing,
         prosecution or maintenance of:

         (a)      the University Patents, shall borne by the Licensee;

         (b)      the Compound Patents shall be borne by the Licensee and shall
                  be creditable (but non-refundable) against royalty payments
                  due from Licensee to Shire under clause 7 (including for the
                  avoidance of doubt, payments under clause 7.7(b)), provided
                  that, in no event will any credit amount under this Agreement
                  reduce the royalties payable to Shire in any Quarter by more
                  than [...***...]% (and any amount that has not been so
                  credited may be credited against royalties due in subsequent
                  Quarters, subject to the limitation described in the previous
                  sentence); and

         (c)      the Background Patents, shall be borne by Shire.

11.5     In the event that Shire elects not to continue to file, prosecute or
         maintain patent protection for any of the Compound Patents, the
         Licensee shall have the right, at its option, to maintain such Compound
         Patents on behalf of Shire. Without limiting the generality of the
         foregoing, in no event shall Shire provide the Licensee with notice of
         abandonment of any Compound Patents less than 30 days prior to its date
         of lapse.

11.6     Shire shall maintain patent protection for all Background Patents
         identified as [...***...] and [...***...] in the Principal Markets.

11.7     Shire reserves all of its rights not expressly granted to the Licensee
         under this Agreement. The Licensee shall not, and shall not attempt or
         purport to file or prosecute in any country any patent application
         which claims, or purports to claim, any Shire Intellectual Property,
         except as permitted under clause 11.5. Additionally, the Licensee shall
         not, directly or indirectly prevent or attempt to prevent Shire from
         filing or prosecuting in any country any patent application which
         claims, discloses or uses or purports to claim, disclose or use any
         Shire Intellectual Property.

12.      INFRINGEMENT OF SHIRE INTELLECTUAL PROPERTY RIGHTS

12.1     Each Party shall promptly notify the other, with such details as it has
         in its possession, on becoming aware of any third party infringement,
         or suspected infringement, of any part of the Shire Intellectual
         Property or the Trade Marks in the Territory.

                                       22    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

12.2     Subject to the terms of the License Agreement, Shire shall have the
         first right, but not the obligation, to take action in respect of any
         infringements of the Shire Intellectual Property or the Trade Marks,
         including any injunctive, compensatory or other remedies or relief
         (collectively "REMEDIES") as may be necessary or desirable to prevent
         such infringement and preserve the Shire Intellectual Property. The
         Licensee shall permit any such Remedies to be brought in its name if
         permitted or required by law. Shire may compromise or settle any of the
         Remedies at its sole discretion, provided that, Shire shall not make
         any settlement or compromise that adversely affects the interests of
         the Licensee in respect of the Licensed Products in the Territory
         without the prior written consent of the Licensee, such consent not to
         be unreasonably withheld or delayed.

12.3     In the event that Shire does not pursue any Remedies with respect to
         the Shire Intellectual Property or the Trade Marks within 60 days
         following notice of alleged infringement or 10 days before the time
         limit, if any, for the filing of any infringement action, whichever is
         sooner, then the Licensee shall, subject to the terms of the License
         Agreement, have the right but, not the obligation, to pursue the
         Remedies against such third party infringer at its sole cost, provided
         that, the Licensee does not make any settlement or compromise that
         adversely affects the interests of Shire without the prior written
         consent of Shire, such consent not to be unreasonably withheld or
         delayed. For the avoidance of doubt, the Licensee's right to pursue any
         Remedies with respect to the infringement, or suspected infringement,
         of any part of the Shire Intellectual Property is limited to the extent
         that such infringement, or suspected infringement relates to the
         Compound.

12.4     In the event that either Party pursues the Remedies under clauses 12.2
         or 12.3:

         (a)      the other Party shall provide reasonable assistance to and
                  cooperate with the Party pursuing such Remedies, including
                  providing access to relevant documents and personnel and
                  furnishing a power of attorney if required by law;

         (b)      the Party that pursues the Remedy shall keep the other Party
                  fully informed of the progress of, and developments in, any
                  proceedings including any settlement discussions with the
                  defendants or potential defendants of such proceedings;

         (c)      each Party shall bear its own costs and expenses relating to
                  its pursuit of the Remedies or in providing assistance and
                  cooperation; and

         (d)      any damages or other amounts awarded or obtained by either
                  Party shall, subject to the terms of the License Agreement, be
                  distributed as follows:

                  (i)      firstly to cover any legal costs and expenses
                           incurred by the Party that pursued the Remedies; and
                           then

                  (ii)     to cover those legal costs and expenses, if any,
                           incurred by the other Party relating to the pursuit
                           of such Remedies; and then

                  (iii)    any remaining amount identified as damages for lost
                           sales of the Licensed Product, after the deductions
                           set out above, shall be paid to Licensee except that

                                       23
<PAGE>
                           Shire shall receive a portion equivalent to the
                           royalties it would have received under this Agreement
                           if such amount were deemed Net Sales; and then

                  (iv)     any remaining amount of damages awarded, other than
                           for damages for lost sales, shall be divided
                           [...***...], with Licensee receiving [...***...]% and
                           Shire receiving [...***...]%.

12.5     Notwithstanding anything contained in this Agreement, Shire reserves
         the right to control, at its sole expense, any opposition, protest,
         claim, proceedings, challenge or litigation relating to the validity of
         the Background Patents. The Licensee shall, and shall procure that its
         Affiliates and Sub-Licensees shall, provide such reasonable assistance
         and co-operation to Shire, at Shire's reasonable expense, as is
         necessary for the conduct of any such opposition, protest, claim,
         proceedings, challenge or litigation. The Licensee may participate in
         the defence or settlement of any opposition, protest, claim,
         proceedings, challenge or litigation relating to the validity of the
         Background Patents at its own cost with counsel of its choice, provided
         that:

         (a)      Shire has control of the conduct of such opposition, protest,
                  claim, proceedings, challenge or litigation relating to the
                  validity of the Background Patents; and

         (b)      the Licensee shall not, and shall procure that its Affiliates
                  and Sub-Licensees shall not, during the course of such
                  proceedings make any statement or admission that compromises
                  the validity of the Background Patents.

13.      INFRINGEMENT OF THIRD PARTY RIGHTS

13.1     In the event that any third party commences or threatens to commence
         patent, trade secret or other patent infringement action against the
         Licensee during the term of this Agreement, alleging that its use of
         the Licensed Product in the Territory infringes the third party's
         Intellectual Property Rights ("THIRD PARTY ACTION"), the Licensee shall
         by written notice promptly inform Shire of the Third Party Action,
         providing all such details of the Third Party Action as are in its
         possession. Upon receipt of the notice, the Parties shall promptly
         discuss the best way to respond to the Third Party Action.

13.2     The Licensee shall, at its sole cost and in its sole discretion, defend
         and control the defence of any such Third Party Action using counsel of
         its own choice, provided that:

         (a)      Shire may participate in the defence or settlement of the
                  Third Party Action at its own cost with counsel of its
                  choice; and

         (b)      the Licensee shall not settle the Third Party Action in a
                  manner adverse to Shire, except as agreed in writing by Shire,
                  such agreement not to be unreasonably withheld or delayed.

13.3     In any Third Party Action under this clause 13, the Parties shall
         cooperate with each other in connection with any such claim, suit or
         proceeding and shall keep each other reasonably informed of any
         material development in connection with the Third Party Action,
         including providing access to relevant documents, personnel or other
         evidence.

                                       24    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

14.      INDEMNIFICATION AND INSURANCE

14.1     The Licensee shall defend, indemnify and hold harmless Shire, its
         Affiliates and its and their directors, officers, employees and
         contractors ("SHIRE PARTIES") from and against any and all claims,
         actions, demands, losses, damages, costs and reasonable expenses
         (including reasonable legal, counsel and expert fees) made or brought
         by any third parties ("CLAIMS") arising from or in connection with the
         research, development, testing, manufacture, marketing, distribution,
         sale or use of the Licensed Product by Licensee or its Affiliates or
         its or their Sub-Licensees, except to the extent that such Claims
         result from the negligence or willful default of the Shire Parties.

14.2     Shire shall promptly:

         (a)      inform the Licensee by written notice of any Claims or the
                  discovery of a fact upon which Shire intends to base a request
                  for indemnification;

         (b)      provide the Licensee with copies of all papers and official
                  documents received in respect of any Claims; and

         (c)      cooperate as reasonably requested by the Licensee in the
                  defence against any Claims.

14.3     The Licensee shall have the sole control over the defence of any
         Claims, provided that, the Licensee shall obtain the written consent of
         Shire, prior to settling or otherwise disposing of such Claims if as a
         result of the settlement or Claim disposal Shire's interests are in any
         way adversely affected. Any costs and expenses, incurred by Shire in
         connection with any Claims shall be reimbursed by the Licensee on a
         Quarterly basis, subject to an obligation of reimbursement if it is
         determined by a court of competent jurisdiction that such Claims are
         not subject to indemnification under clause 14.1.

14.4     Shire shall defend, indemnify and hold harmless Licensee, its
         Affiliates and its and their directors, officers, employees and
         contractors ("LICENSEE PARTIES") from and against any and all Claims
         resulting from a breach of clause 16.2.

14.5     Notwithstanding anything contained in this Agreement, in no event shall
         either Party or their respective Affiliates be liable for special,
         indirect, incidental or consequential loss or damage based on contract,
         tort or any other legal theory arising out of this Agreement. Nothing
         in this Agreement shall limit either Party's liability to any person
         for death or personal injury caused by negligence.

14.6     The Licensee shall, at its own cost, during the term of this Agreement
         and for a period of 10 years thereafter, maintain insurance which is
         reasonable and customary in the United States of America pharmaceutical
         industry for companies of comparable size and activities, and in any
         event:

         (a)      listing Shire and the Indemnitees (as defined in the License
                  Agreement) as additional insureds on the policy by no later
                  than October 1, 2004;

                                       25

<PAGE>

         (b)      covering product liability in relation to the studies
                  undertaken in connection with the development of the Licensed
                  Product in amounts no less than US$1 million per incident and
                  US$3 million annual aggregate; and

         (c)      covering comprehensive product liability insurance and general
                  commercial liability insurance with respect to the
                  manufacture, use or sale Licensed Product from receipt of
                  Marketing Authorization in amounts not less than
                  US$5 million per incident and US$10 million annual
                  aggregate.

14.7     Upon reasonable request from Shire, the Licensee shall provide, or
         procure that its Sub-Licensees provide documents from its insurer
         confirming the existence and renewal of the relevant insurance policies
         conforming with the requirements of clause 14.6.

15.      CONFIDENTIALITY AND PUBLICATIONS

15.1     The Parties, their Affiliates and their respective directors, officers,
         employees, officers and consultants shall keep and maintain any
         Confidential Information supplied by the other Party during the term of
         this Agreement strictly confidential. The confidentiality obligations
         contained in this Agreement shall not apply to the extent that such
         Confidential Information is:

         (a)      at the time of disclosure by one Party to the other in the
                  public domain or otherwise publicly known;

         (b)      after disclosure by one Party to the other becomes part of the
                  public domain, other than by breach of any obligation of
                  confidentiality;

         (c)      information which the receiving Party can establish by
                  documentary evidence was already in its possession at the time
                  of receipt or was independently developed by the receiving
                  Party without use of the Confidential Information of the
                  disclosing Party; or

         (d)      received from a third party who was lawfully entitled to
                  disclose such information without an obligation of
                  confidentiality.

15.2     Notwithstanding clause 15.1, the Party receiving Confidential
         Information may disclose such Confidential Information:

         (a)      to Regulatory Authorities or other government agencies to gain
                  approval to conduct clinical trials in relation to the
                  Licensed Product or to file, prosecute and maintain the
                  Marketing Authorizations and any other required filings for
                  the Licensed Product, provided that, the disclosure is limited
                  to the extent reasonably necessary to obtain such
                  authorizations or approvals;

         (b)      to the extent that such disclosure is required by any
                  applicable law, regulation, court of competent jurisdiction or
                  governmental authority (including the FDA and the SEC),
                  provided that, the Confidential Information may be disclosed
                  only to the extent

                                       26
<PAGE>

                  required and wherever practicable, the disclosing Party has
                  been given sufficient written notice in advance to enable it
                  to seek protection or confidential treatment of such
                  Confidential Information;

         (c)      to Affiliates, actual or potential Sub-Licensees,
                  sub-contractors, employees, consultants and agents who have a
                  need to know the information for the purposes of this
                  Agreement, and are bound by obligations of confidentiality no
                  less protective than those contained in this Agreement; or

         (d)      to Third Parties in connection with due diligence
                  investigations in relation to the Licensee (for example,
                  potential investors), provided that, such Third Parties are
                  bound by confidentiality obligations no less protective than
                  those contained in this Agreement; or

         (e)      representatives of the University, provided that, such
                  representatives are bound by confidentiality obligations no
                  less protective than those contained in this Agreement.

15.3     The Parties shall consult with each other, in advance, with regard to
         the terms of all proposed press releases, public announcements and
         other public statements relating to any Confidential Information or the
         transactions contemplated under this Agreement. Shire acknowledges that
         in connection with any public offering of the stock of Licensee,
         Licensee may be required to file this Agreement with the SEC, subject
         to confidential treatment requests.

16.      WARRANTIES

16.1     Shire and the Licensee each warrant that:

         (a)      it has obtained all corporate authorisations required to enter
                  into and perform its obligations under this Agreement; and

         (b)      this Agreement is valid and binding obligation enforceable
                  against it in accordance with its terms and conditions.

16.2     At the Effective Date, Shire warrants that:

         (a)      the Shire Patents are owned by Shire and the University
                  Patents are exclusively licensed to Shire under the terms of
                  the License Agreement;

         (b)      all renewal and maintenance fees in relation to the Shire
                  Patents and University Patents have been paid on or before the
                  due date for payment;

         (c)      so far as it is aware, there are no current oppositions or
                  interferences relating to the Shire Patents or University
                  Patents;

         (d)      it has not received any notice from any third party in the
                  last 6 years alleging that the Compound infringes any third
                  party Intellectual Property Rights;

                                       27

<PAGE>

         (e)      it has not sent any notice to any third party in the last
                  6 years alleging that the third party is infringing the Shire
                  Intellectual Property with respect to the Compound;

         (f)      so far as it is aware, Shire has no royalty or other license
                  payment obligations to third parties with respect to the
                  research, use, manufacture or sale of the Compound other than
                  under the License Agreement and Consultancy Agreement; and

         (g)      except for the Excluded Patents, the list of Licensed Patents
                  in Schedule 2 of this Agreement is a complete list of the
                  patents and patent applications owned by or licensed to Shire
                  containing claims relating to the Compound.

16.3     Notwithstanding anything contained in this Agreement, Shire gives no
         warranty and makes no representation that any patent application
         identified in Schedule 2 shall proceed to grant or will be valid and
         enforceable.

16.4     Except for the warranties set out in clause 16, no warranty, condition,
         term, undertaking or representation (express or implied, statutory or
         otherwise) is given by Shire to the Licensee in respect of the Shire
         Intellectual Property, the Licensed Product or any other products
         developed, manufactured, sold or supplied by the Licensee using the
         Shire Intellectual Property and all such warranties, conditions, terms,
         undertakings and representations are to the extent permitted by law
         expressly excluded.

17       COMPLIANCE WITH LAW

17.1     In exercising its rights and obligations under this Agreement, the
         Licensee shall comply with, or shall procure compliance by its
         Affiliates and Sub-Licensees with, all applicable national and local
         laws, rules and regulations including but not limited to the
         requirements of any Marketing Authorization s or any relevant laws,
         rules or regulations concerning the research, development, manufacture,
         delivery, transport, import, advertising, packaging, labelling,
         storage, sale or use of the Licensed Product in the Territory or any
         part of it.

17.2     The Licensee shall use reasonable efforts to promptly inform Shire of
         any new laws, rules or regulations in the Territory (or any part of it)
         or any amendments, or proposed amendments to the current laws, rules or
         regulations that may have material impact on the use, distribution or
         sale of the Licensed Product.

17.3     In performing any of their respective rights and obligations under this
         Agreement, each Party shall comply with all applicable data protection
         laws and regulations.

18       TERM

18.1     This Agreement commences on the Effective Date and, subject to earlier
         termination in accordance with clause 19, shall with respect to each of
         the countries in the Territory expire on the last to occur of:

         (a)      expiry of the last to expire of the issued Shire Patents or
                  the University Patents in the applicable country, including
                  patents issued on patent applications within Shire Patents or
                  University Patents as the case may be; or

                                       28

<PAGE>

         (b)      10 years from the date of first commercial sale in that
                  country.

19       TERMINATION

19.1     Either Party shall be entitled to terminate this Agreement by written
         notice to the other if:

         (a)      the other Party commits a material breach of this Agreement,
                  and in the case of a breach which is capable of remedy fails
                  to remedy it within 60 days of receipt of notice from the
                  first Party of such breach and of its intention to exercise
                  its rights under this clause; or

         (b)      an order is made or a resolution is passed for the winding up
                  of the other Party (other than voluntarily for the purposes of
                  solvent amalgamation or reconstruction) or an order is made
                  for the appointment of an administrator to manage the other
                  Party's affairs, business and property or if a receiver (which
                  expression shall include an administrative receiver) is
                  appointed over any of the other Party's assets or undertaking
                  or if circumstances arise which entitle the court or a
                  creditor to appoint a receiver or manager or which entitle the
                  court to make a winding-up order or if a voluntary arrangement
                  is proposed in respect of the other Party or if the other
                  Party takes or suffers any similar or analogous action in
                  consequence of debt, and such order, appointment or similar
                  action is not removed within 90 days.

19.2     This Agreement may be terminated by Shire by notice in writing to the
         Licensee at any time (except as provided in clause 19.2(a)) if:

         (a)      the Licensee fails to make the upfront payment of
                  US$3 million to Shire within 3 Business Days from the
                  Effective Date pursuant to clause 7.1, with immediate effect
                  from receipt of the notice from Shire; which right of
                  termination will terminate on the earlier of (i) payment by
                  Licensee of the upfront payment of US$3 million to Shire or
                  (ii) 28 days from the expiration of the 3 Business Days from
                  the Effective Date;

         (b)      the Licensee, its Affiliates or its Sub-Licensees fail to make
                  any Milestone Payments or other payments of any sums due under
                  this Agreement (other than the upfront payment pursuant to
                  clause 7.1) within 30 days of receiving notice from Shire
                  requiring such payment;

         (c)      the Licensee, its Affiliates or its Sub-Licensees, directly or
                  indirectly, challenge the validity of the Shire Intellectual
                  Property or the Trade Marks or the right of Shire to use or
                  license the use of any of such Shire Intellectual Property or
                  the Trade Marks, or the Licensee assists any third party to
                  challenge the validity of such Shire Intellectual Property or
                  the Trade Marks;

         (d)      subject to clause 19.3, in the event of a Change of Control
                  where the new controlling party of the Licensee owns or
                  licenses a Competing Product;

         (e)      the Licensee ceases or threatens by written notice to cease to
                  carry on its business relating to oncology products;

                                       29

<PAGE>

         (f)      in the event that the Licensee or its Affiliates or
                  Sub-Licensees has not commenced a phase II study of the
                  Licensed Product in the United States of America within
                  12 months from the Effective Date;

         (g)      subject to clause 19.4, in the event that the Licensee or its
                  Affiliates or Sub-Licensees has not filed for Accelerated
                  Approval or commenced a phase III study of the Licensed
                  Product in the United States of America by 31 December 2007;

         (h)      in the event that the Licensee or its Affiliates or
                  Sub-Licensees has not filed an NDA by 31 December 2009,
                  provided that, Shire may not terminate this Agreement under
                  this sub-clause if the Licensee can reasonably demonstrate
                  that such delay or failure to file an NDA by 31 December 2009
                  is due to circumstances directly relating to Development Plan
                  and beyond its reasonable control, in which event the Licensee
                  shall have a further period of 12 months to achieve such
                  event;

         (i)      in the event that for a reason attributable to the Licensee,
                  its Affiliates or its Sub-Licensees any NDA or Marketing
                  Authorization in the Principal Markets lapses or is revoked by
                  any competent Regulatory Authority in the Territory; or

         (j)      in the event that the Licensee fails to provide Shire with any
                  semi-annual reports under clause 5.3(d).

19.3     In the event of Change of Control, where the new controlling party of
         the Licensee owns or licenses a Competing Product, the Licensee shall
         by written notice inform Shire of the Change of Control and Shire shall
         have 90 days from receipt of such notice to exercise its right of
         termination under clause 19.2(c). Notwithstanding anything contained in
         this clause, the Parties agree that Shire may not terminate this
         Agreement pursuant to clause 19.2(c) if the new controlling party
         agrees to divest such Competing Product and in fact so divests such
         Competing Product within 6 months from the date of completion of the
         Change of Control (subject to extension for an additional 3 months if
         the new controlling party has entered into a binding agreement with
         respect to such divestiture within such 6 month period). If the new
         controlling party is unable or unwilling to divest the Competing
         Product within such period, Shire shall be entitled to terminate this
         Agreement by 30 days written notice to the Licensee.

19.4     In the event that the Licensee's application for Accelerated Approval
         is unsuccessful, the Licensee shall have 6 months from date of receipt
         of the Accelerated Approval rejection notice to commence a phase III
         study of the Licensed Product in the United States of America, failing
         which, Shire may terminate this Agreement by written notice with
         immediate effect.

19.5     This Agreement may be terminated by Licensee by 90 days written notice
         to Shire, at any time after the second anniversary of the Effective
         Date, if:

         (a)      after making a reasonable evaluation of the safety, efficacy
                  or other data generated during the Development Plan, the
                  Licensee determines that the Licensed Product is not a
                  scientifically or commercially viable for further development
                  or commercialisation; or

                                       30
<PAGE>

         (b)      the Licensee reasonably believes it will be unable to obtain
                  Marketing Authorization in the United States of America
                  after diligent pursuit of such Marketing Authorization.

19.6     If the Licensee, its Affiliates or any Sub-Licensee, after having
         Launched the Licensed Product in any country in the Territory,
         discontinues the sale of the Licensed Product in such country for a
         period of 6 months or more for reasons unrelated to Force Majeure or
         regulatory or safety issues in relation to the use of the Licensed
         Product, and subsequently fails to resume sales of any Licensed Product
         in such country within 90 days of having been notified in writing
         of the failure to supply by Shire, then Shire may terminate the rights
         granted to the Licensee under this Agreement and the Trade Mark license
         solely with respect to such country by written notice to the Licensee.
         For the purpose of this clause, sales of minimal or commercially
         insignificant quantities of Licensed Product in a country shall be
         deemed to constitute a discontinuation of sales in such country.

20       CONSEQUENCES OF TERMINATION

20.1     On termination of this Agreement by either Party the license and
         sub-license (subject to the terms of the Memorandum of Understanding
         and Sub-Licensee MOU) granted under this Agreement shall immediately
         cease and the Licensee shall, and shall procure that its Affiliates and
         Sub-Licensees shall:

         (a)      subject to clause 20.4, immediately cease to carry out any of
                  the activities permitted by this Agreement (or any relevant
                  Sub-License Agreement) and cease to use or exploit in any way
                  the Licensed Product, the Trade Marks or the Shire
                  Intellectual Property;

         (b)      within 60 days of the date of the termination notice make all
                  outstanding payments including any royalty payments due to
                  Shire at the date of termination; and

         (c)      promptly return, or at Shire's option, destroy any Shire
                  Know-How and any materials containing the Shire Know-How in
                  its possession, custody or power except for such records as
                  may be required to be retained by the Licensee by any national
                  or local laws, rules or regulations.

20.2     On termination of this Agreement by either Party for any reason, other
         than by the Licensee under clause 19.1, the Licensee shall, and shall
         procure that its Affiliates and, Sub-Licensees subject to the terms of
         the Sub-Licensee MOU, shall:

         (a)      promptly deliver up to Shire any Development Data,
                  Improvements or other materials generated by the Licensee, its
                  Affiliates or Sub-Licensees in the development, registration
                  or commercialization of the Licensed Product;

         (b)      within 90 days from the date of termination, assign to Shire
                  (or its nominated Affiliate) all right, title and interest in
                  any Marketing Authorization in the Territory; and

                                       31
<PAGE>

         (c)      grant Shire an exclusive, royalty free, worldwide, irrevocable
                  and perpetual license to use (with the right to sub-license)
                  the Development Data and any registration materials developed
                  or acquired by or on behalf of the Licensee its Affiliates or
                  Sub-Licensees during the term of this Agreement.

20.3     On expiry of this Agreement, Shire shall grant, the Licensee an
         exclusive, royalty-free, worldwide, irrevocable and perpetual license
         to use and exploit (with the right to sub-license) the Shire Know-How,
         including the right use the Shire Know-How to make, have made, use,
         offer for sale, sell and import the Licensed Products.

20.4     The Licensee, its Affiliates and Sub-Licensees shall be entitled to
         continue to sell existing stocks of the Licensed Products in the
         Territory for a period of not longer than 6 months following the date
         of termination, provided that, the Licensee pays Shire any royalties
         due in respect of such sales in accordance with the provisions of this
         Agreement.

20.5     Subject to clause 20.6, on termination of this Agreement by Shire under
         Sections 19.1 or 19.2, the Licensee hereby grants Shire an option to
         exclusively license any Intellectual Property Rights owned or licensed
         (with the right to sublicense) by the Licensee that claim or cover any
         Improvements generated by the Licensee during the term of this
         Agreement ("OPTION"). The Option shall be exercisable by Shire at any
         time within [...***...] from the date of notice of termination. Within
         15 days from receipt by the Licensee, of notice from Shire confirming
         the exercise of the Option, Shire and the Licensee shall negotiate in
         good faith for a period not to exceed [...***...] the grant to Shire of
         a exclusive, royalty bearing, worldwide, license to use (with the right
         to sub-license) the Improvement developed or acquired by or on behalf
         of the Licensee during the term of this Agreement, on commercially
         reasonable terms.

20.6     In the event that this Agreement is terminated as a result of the
         termination of the License Agreement by the University, and no license
         for the University Patents is granted to the Licensee pursuant to the
         Memorandum of Understanding, the Licensee shall grant the University
         the Option rights set out in clause 20.5 instead of to Shire under
         clause 20.6.

20.7     Subject to any separate agreement with the Sub-Licensee pursuant to
         clause 3.2, upon the termination or expiry of this Agreement, the
         Licensee shall, and shall procure that its Affiliates and Sub-Licensees
         shall execute such documents as Shire may reasonably require to record
         at all appropriate patent offices throughout the Territory that the
         Licensee or the relevant Sub-Licensee has ceased to be entitled to use
         and exploit the Licensed Patents.

20.8     In the event that the Licensee wishes to continue the use of the Trade
         Mark for the sale of the Licensed Product after the expiration of this
         Agreement, Shire shall grant to the Licensee an exclusive
         non-transferable license for the Trade Mark in the Territory on terms
         to be agreed between the Parties, provided that the Licensee notifies
         Shire within [...***...] of the date of such expiry that it wishes to
         take such a license and the Licensee shall pay Shire a perpetual Trade
         Mark royalty of [...***...]% of the Net Sales of the Licensed Product
         in accordance with clause 8.2.

                                       32    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

20.9     The termination or expiry of this Agreement shall not release either of
         the Parties from any liability which at the time of termination or
         expiry has already accrued to the other Party, nor affect in any way
         the survival of any other right, duty or obligation of the Parties
         which is expressly stated elsewhere in this Agreement to survive such
         termination or expiry.

20.10    Clauses 1, 9, 14, 15.1, 15.2, 16.3, 16.4, 20, 22, 23, and 24 shall
         survive the termination or expiry of this Agreement.

21       FORCE MAJEURE

21.1     Neither Party shall be entitled to terminate this Agreement or shall be
         liable to the other under this Agreement for loss or damages
         attributable to any Force Majeure, provided that, the Party affected
         shall give prompt notice thereof to the other Party. Subject to clause
         21.2, the Party giving such notice shall be excused from such of its
         obligations hereunder for so long as it continues to be affected by
         Force Majeure.

21.2     If such Force Majeure continues unabated for a period of at least 90
         days, the Parties will meet to discuss in good faith what actions to
         take or what modifications should be made to this Agreement as a
         consequence of such Force Majeure in order to alleviate its
         consequences on the affected Party.

22       NOTICES

22.1     Any notice or other document given under this Agreement shall be in
         writing in the English language and shall be given by hand or sent by
         prepaid airmail or by fax transmission to the address of the receiving
         Party as set out in clauses 22.3 below unless a different address or
         fax number has been notified to the other in writing for this purpose.

22.2     Each such notice or document shall:

         (a)      if sent by hand, be deemed to have been given when delivered
                  at the relevant address;

         (b)      if sent by prepaid airmail, be deemed to have been given 7
                  days after posting; or

         (c)      if sent by fax transmission be deemed to have been given when
                  transmitted provided that a confirmatory copy of such
                  facsimile transmission shall have been sent by prepaid airmail
                  within 24 hours of such transmission.

22.3     The address for services of notices and other documents on the Parties
         shall be:

           TO SHIRE BIOCHEM                      TO THE LICENSEE
           275 boul. Armand-Frappier,            ADDRESS:   10505 Roselle Street
           Laval, QC,                                       San Diego, CA 92121
           Canada H7V 4A7                                   U.S.A.

           FAX:      +1 450 978 7767             FAX:       +1 858 558 3402

                                       33
<PAGE>

           ATTENTION: Claude Perron              ATTENTION:  Michael Grey

           COPY TO:   Shire Legal Department     COPY TO:    Legal Department
                      +44 (0)1256 894 710                    +1 858 558 3402

           TO TANAUD IRELAND                     TO TANAUD BV

           Shannon Airport House,                Fred Roeskestraat 123,
           Shannon, Co Clare,                    First Floor, 1076 EE Amsterdam,
           Ireland                               The Netherlands

           FAX:       +353 61 472 060            FAX:         +31 20 577 1188

           ATTENTION: Alan Kane                  ATTENTION:   Dirk Stolp

23       ASSIGNMENT

23.1     Subject to clause 23.2, the Licensee shall not assign or transfer any
         of its rights or obligations under this Agreement without the prior
         written consent of Shire, such consent not to be unreasonably withheld
         or delayed; provided that the Licensee may assign or transfer this
         Agreement and its rights and obligations hereunder without Shire's
         consent in connection with the sale or transfer of all or substantially
         all of the Licensee's business to which this Agreement relates to a
         third party, whether by merger, sale of stock, sale of assets or
         otherwise. In the event of any such transaction however, Intellectual
         Property Rights of the acquiring party under such transaction shall not
         be included in the Intellectual Property Rights subject to this
         Agreement.

23.2     The Licensee may sub-license all or any of its rights under this
         Agreement provided that the Licensee complies with its obligations set
         out in clause 3.

23.3     Shire shall be entitled to assign all or any of its rights or
         obligations under this Agreement to an Affiliate.

24       GENERAL PROVISIONS

24.1     Nothing in this Agreement is deemed to constitute a partnership between
         the Parties nor constitute either Party the agent of the other Party
         for any purpose.

24.2     Any disagreement between Shire and the Licensee on the interpretation
         of this Agreement or any aspect of the performance by either Party of
         its obligations under this Agreement shall be resolved in accordance
         with the dispute resolution procedure set out in Schedule 8 provided
         that either Party shall have the right to seek urgent injunctive or
         other equitable relief in any court of competent jurisdiction.

24.3     Each of the Parties shall do execute and perform and shall procure to
         be done executed and performed all such further acts deeds documents
         and things as the other Party may reasonably require from time to time
         to give full effect to the terms of this Agreement.

                                       34
<PAGE>

24.4     Each Party shall pay its own costs, charges and expenses incurred in
         connection with the negotiation, preparation and completion of this
         Agreement.

24.5     This Agreement sets out the entire agreement and understanding between
         the Parties in respect of the subject matter of this Agreement and
         supersedes any heads of agreement which shall cease to have any further
         force or effect. It is agreed that:

         (a)      no Party has entered into this Agreement in reliance upon any
                  representation, warranty or undertaking of the other Party
                  which is not expressly set out in this Agreement;

         (b)      no Party shall have any remedy in respect of misrepresentation
                  or untrue statement made by the other Party or for any breach
                  of warranty which is not contained in this Agreement; and

         (c)      this clause shall not exclude any liability for, or remedy in
                  respect of, fraudulent misrepresentation.

24.6     Nothing in this Agreement shall operate to:

         (a)      exclude any provision implied into this Agreement by law and
                  which may not be excluded by law; or

         (b)      limit or exclude any liability, right or remedy to a greater
                  extent than is permissible under law.

24.7     No variation of this Agreement shall be valid unless it is in writing
         and signed by or on behalf of both Parties.

24.8     Unless expressly agreed, no variation shall constitute a general waiver
         of any provisions of this Agreement, nor shall it affect any rights,
         obligations or liabilities under or pursuant to this Agreement which
         have already accrued up to the date of variation, and the rights and
         obligations of the Parties under or pursuant to this Agreement shall
         remain in full force and effect, except and only to the extent that
         they are so varied.

24.9     If and to the extent that any provision of this Agreement is held to be
         illegal, void or unenforceable, such provision shall be given no effect
         and shall be deemed not to be included in this Agreement but without
         invalidating any of the remaining provisions of this Agreement.

24.10    No failure or delay by either Party in exercising any right or remedy
         provided by law under or pursuant to this Agreement shall impair such
         right or remedy or operate or be construed as a waiver or variation of
         it or preclude its exercise at any subsequent time and no single or
         partial exercise of any such right or remedy shall preclude any other
         or further exercise of it or the exercise of any other right or remedy.

                                       35
<PAGE>

24.11    The rights and remedies of each of the Parties under or pursuant to
         this Agreement are cumulative, may be exercised as often as such Party
         considers appropriate and are in addition to its rights and remedies
         under general law.

24.12    If in any jurisdiction the effect of any provision of this Agreement or
         the absence from this Agreement of any provision would be to prejudice
         the Licensed Patents or any remedy under the Licensed Patents, the
         Parties will make such amendments to this Agreement and execute such
         further agreements and documents limited to that part of the Territory
         which falls under such jurisdiction as may be necessary to remove such
         prejudicial effects.

24.13    This Agreement may be executed in any number of counterparts and by the
         Parties on separate counterparts, each of which is an original but all
         of which together constitute one and the same instrument.

24.14    The Licensee, or any Sub-Licensee or assignee, shall not create, assume
         or permit to exist any lien, pledge, security interest or other
         encumbrance on this Agreement or any Sub-License Agreement, provided
         that, Licensee or any Sub-Licensee shall be permitted to create, assume
         or permit to exist any lien, pledge, security interest or other
         encumbrance on this Agreement or any Sub-License Agreement:

         (a)      pursuant to obligations to its creditors outstanding as of the
                  Effective Date; and

         (b)      pursuant to the Loan and Security Agreement dated as of July
                  23, 2004 between the Licensee and its creditors thereto.

24.15    This Agreement and the obligations of the Parties shall be governed by
         and construed in accordance with the laws of the state of New York and
         subject to the jurisdiction of the New York courts.

         The rest of this page has been left intentionally blank.

                                       36
<PAGE>

AS WITNESS this Agreement has been signed by the duly authorised representatives
of the Parties on the day and year first before written.

SIGNED for and on behalf of     )            /s/ Angus Russell
SHIRE BIOCHEM INC.              )            -----------------------------------
                                )
                                             Angus Russell, Director
                                             -----------------------------------
                                             PRINT NAME AND TITLE

SIGNED for and on behalf of     )            /s/ Joseph Rus
TANAUD IRELAND INC.             )            -----------------------------------
                                )
                                             Joseph Rus, Director
                                             -----------------------------------
                                             PRINT NAME AND TITLE

SIGNED for and on behalf of     )            /s/ Joseph Rus
TANAUD INTERNATIONAL B.V.       )            -----------------------------------
                                )
                                             Joseph Rus, Director
                                             -----------------------------------
                                             PRINT NAME AND TITLE

SIGNED for and on behalf of     )            /s/ M.G. Grey
STRUCTURAL GENOMIX, INC.        )            -----------------------------------
                                )
                                             M.G. Grey, President
                                             -----------------------------------
                                             PRINT NAME AND TITLE

                                       37
<PAGE>

                                   SCHEDULE 1

                          DEVELOPMENT PLAN AND TIMELINE

ACTIVITY                                                      ANTICIPATED TIMING

Initiate Transition Plan                                           July 2004

AML

Complete Open Phase 1 Trial                                       [...***...]

Last cohort of patients dosed at [...***...] days
   [...***...] was [...***...] with [...***...]
   [...***...] had [...***...] the [...***...] of [...***...]
   An increase in [...***...]
   [...***...] to be [...***...] days)
   [...***...]
   [...***...]

Commence [...***...] Trial                                        [...***...]

Patient Population
   [...***...]
   [...***...]

Trial Size
   [...***...]
   [...***...]

Study Endpoints
   [...***...]
   [...***...]

Treatment Centers
   [...***...]

Complete [...***...] Trial                                        [...***...]

[...***...]                                                       [...***...]
   [...***...] for [...***...]
   [...***...] if [...***...] in the [...***...] is [...***...]
   [...***...] to [...***...]
   [...***...]

                                       38    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

Complete [...***...] Trial                                        [...***...]

Commence [...***...] Trial ([...***...])                          [...***...]

Patient Population
   [...***...] over [...***...] of age
   [...***...]

Treatment and Trial Size
   [...***...] at [...***...]
   [...***...] at [...***...]

Treatment Centers
   [...***...]

Study Endpoints
   [...***...] is [...***...] of [...***...]
   [...***...] is [...***...] of [...***...]

Complete [...***...] Trial                                        [...***...]

BLAST PHASE CML

Based on review of clinical opportunities with CML experts:

Commence [...***...] Trial                                        [...***...]

Patient population
   [...***...] CML-BP [...***...] or [...***...]

   Treatment and trial size
        [...***...] at [...***...]
        ~[...***...]

   Study Endpoints
        [...***...] to [...***...] CML [...***...]
        [...***...] of [...***...]

Complete [...***...] Trial                                        [...***...]

Evaluate next steps                                               [...***...]

MDS

Based on review of clinical opportunities with MDS experts:

                                       39    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

Commence [...***...] MDS Trial                                    [...***...]

SOLID TUMOR

Evaluate Open Phase 1 solid tumor
Continuous infusion study                                         [...***...]

Complete Phase 1 if existing data are supportive                  [...***...]

Initiate Phase 2                                                  [...***...]

                                       40    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 2

                                LICENSED PATENTS

PART I - BACKGROUND PATENTS

[...***...], SYNTHESIS AND USE THEREOF

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       41    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...] AND USE THEREOF

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PROCESS FOR [...***...] SYNTHESIS OF NUCLEOSIDES

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       42    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       43    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PROCESS FOR DIASTEREOSELECTIVE SYNTHESIS OF NUCLEOSIDES

<Table>
<Caption>
DOCKET NUMBER       APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       44    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
DOCKET NUMBER       APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

STEREOSELECTIVE SYNTHESIS OF [...***...] USING [...***...] INTERMEDIATE

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       45    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

METHOD AND COMPOSITIONS FOR THE SYNTHESIS OF [...***...] WITH [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       46    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       47    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

STEREOSELECTIVE SYNTHESIS OF [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PROCESS FOR PRODUCING [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       48    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

STEREOSELECTIVE PROCESS FOR THE PRODUCTION OF [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PART II - COMPOUND PATENTS

METHOD OF TREATING [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       49    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

METHODS OF TREATING CANCER USING A [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PHARMACEUTICAL [...***...] FOR THE TREATMENT OF CANCER

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       50    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

[...***...]

[...***...] FOR IMPROVED [...***...] DELIVERY

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

METHODS OF TREATING [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       51    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

PHARMACEUTICAL [...***...] AND METHODS FOR THE TREATMENT OF [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

METHODS OF [...***...] OF TROXACITABINE

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

METHOD FOR THE TREATMENT OF [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

PART III - UNIVERSITY PATENTS

COMPOUNDS AND METHODS FOR THE TREATMENT OF CANCER

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       52    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       53    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

COMPOUNDS AND METHODS FOR THE TREATMENT OF CANCER

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       54    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 3

                     MILESTONE EVENTS AND MILESTONE PAYMENTS

<Table>
<Caption>

NO.           MILESTONE EVENT                                                       MILESTONE PAYMENT (US$)
----------    -------------------------------------------------------------------   ------------------------
<S>           <C>                                                                   <C>

              DEVELOPMENT MILESTONES

1.            On the Licensee obtaining [...***...]                                       $[...***...]

2.                                                                                        $[...***...]
              The earlier of:

              o      the [...***...] of the [...***...] of the [...***...]; or

              o      the [...***...] of the [...***...] after [...***...] for
                     the [...***...]; or

              o      [...***...] of [...***...] that the [...***...].

3.            The earlier of:

              o      the [...***...] the [...***...] of the [...***...] for
                     [...***...]; or

              o      the [...***...] the [...***...] of the [...***...] for the           $[...***...]
                     [...***...]; or

              o      [...***...] of [...***...] that the [...***...].

4.            File for Marketing Authorization for first indication
              ([...***...]) of the Licensed Product in any of the [...***...].            $[...***...]

5.            File for Marketing Authorization for [...***...] of the Licensed
              Product in any of the [...***...].                                          $[...***...]

6.            Receipt of Marketing Authorization from any Regulatory Authority
              for the first indication ([...***...]) of the Licensed Product in
              any of the                                                                  $[...***...]
</Table>

                                       55    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<S>           <C>                                                                   <C>
              [...***...].

7.            Receipt of Marketing Authorization from any Regulatory Authority      $[...***...]
              for the [...***...] of the Licensed Product in any of the
              [...***...]

8.            Receipt of Marketing Authorization from any Regulatory Authority
              for the second indication ([...***...]) of the Licensed Product in    $[...***...]
              any of the [...***...]

8.            Receipt of Marketing Authorization from any Regulatory Authority
              for the [...***...] of the Licensed Product in any of the             $[...***...]
              [...***...]

              SALES MILESTONES

9.            The first time that Net Sales of the Licensed Product in the          $[...***...]
              Territory surpass US$[...***...] in any calendar year

10            The first time that Net Sales of the Licensed Product in the          $[...***...]
              Territory surpass US$[...***...] in any calendar year

11.           The first time that Net Sales of the Licensed Product in the          $[...***...]
              Territory surpass US$[...***...] in any calendar year

12.           The first time that Net Sales of the Licensed Product in the          $[...***...]
              Territory surpass US$[...***...] in any calendar year

</Table>

                                       56    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                   SCHEDULE 4

                        SALES FORECASTS AND MINIMUM SALES

<Table>
<Caption>
   No.     YEAR                                     SALES FORECAST          MINIMUM SALES FORECAST
-------    ------------------------------------     -------------------     ----------------------
<S>        <C>                                      <C>                     <C>
    1.     First year following Launch              US$[...***...]               US$[...***...]

    2.     Second year following Launch             US$[...***...]               US$[...***...]

    3.     Third year following Launch              US$[...***...]               US$[...***...]

    4.     Fourth year following Launch             US$[...***...]               US$[...***...]

</Table>

                                       57    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 5

                                 SHIRE MATERIALS

<Table>
<Caption>
                                                                          EXPIRY
                                                                       DATE/RETEST
MATERIAL DESCRIPTION                 LOT NUMBER          QUANTITY          DATE          WAREHOUSE SITE
-----------------------------        -----------       -----------      -----------     ----------------
<S>                          <C>    <C>    <C>    <C>    <C>    <C>

Troxatyl 2 mg IMP                    [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl 10 mg IMP                   [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl 2 mg IMP                    [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl 10 mg IMP                   [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl API                         [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl API                         [...***...]       [...***...]      [...***...]       [...***...]
Troxatyl API                         [...***...]       [...***...]      [...***...]       [...***...]
API Reference Standard               [...***...]       [...***...]      [...***...]       [...***...]
Ongoing Compound stability samples
including available impurities
standards (samples to remain at
stability testing site)
</Table>

                                       58    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 6

                                   TRADE MARKS

<Table>
<Caption>
NO.        TRADE MARK      OWNER                 COUNTRY          CLASS        NUMBER         APP/REG DATE    STATUS
---------- ------------    -----------------     -----------      ----------   -----------    ------------    ------------
<S>        <C>             <C>                   <C>              <C>          <C>            <C>             <C>

1.         TROXATYL        Shire BioChem         [...***...]      [...***...]                 [...***...]     [...***...]
2.         TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
3.         TROXATYL        Shire BioChem         [...***...]      [...***...]                 [...***...]     [...***...]
4.         TROXATYL        Shire BioChem         [...***...]      [...***...]                 [...***...]     [...***...]
5.         TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
6.         TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
7.         TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
8.         TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
9.         TROXATYL        Shire BioChem         [...***...]      [...***...]                 [...***...]     [...***...]
10.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
11.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
12.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
13.        TROXATYL        Shire BioChem         [...***...]                                  [...***...]     [...***...]
14.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
15.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
16.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
17.        TROXATYL        Shire BioChem         [...***...]      [...***...]  [...***...]    [...***...]     [...***...]
18.        TROXATYL        Shire BioChem         [...***...]      [...***...]                 [...***...]     [...***...]
</Table>

                                       59    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

                                   SCHEDULE 7

                           MEMORANDUM OF UNDERSTANDING

MEMORANDUM OF UNDERSTANDING

DATED:   23 JULY 2004

BETWEEN:

(1)      UNIVERSITY OF GEORGIA RESEARCH FOUNDATION, INC., a nonprofit Georgia
         corporation with offices located in Boyd Graduate Studies Research
         Center, The University of Georgia, Athens, Georgia 30602 ("UGARF");

(2)      YALE UNIVERSITY located in New Haven, Connecticut ("YALE"); and

(3)      STRUCTURAL GENOMIX, INC., a company incorporated in Delaware, whose
         address is 10505 Roselle Street, San Diego, CA 92121, U.S.A.
         ("SUB-LICENSEE").

BACKGROUND:

(A)      On 3 January 1996, UGARF and Yale entered into a license agreement with
         Shire BioChem Inc. (formerly BioChem Pharma Inc.), Tanaud Holdings
         (Barbados) Limited and Tanaud LLC (collectively "SHIRE") under which
         the University Patents and Licensed Technology (as defined below) were
         exclusively licensed to Shire ("HEAD LICENCE").

(B)      On 23 July 2004, Shire entered into a licence agreement with the
         Sub-Licensee under which certain patents and know how were exclusively
         licensed to the Sub-Licensee and the University Patents and Licensed
         Technology were sub-licensed to the Sub-Licensee ("SHIRE LICENCE").

(C)      Yale and UGARF have agreed to grant a licence under the University
         Patents and Licensed Technology to the Sub-Licensee on the same
         financial terms to the Head Licence in the event that the Head Licence
         is terminated as more specifically set out in this Memorandum of
         Understanding ("MEMORANDUM").

OPERATIVE PROVISIONS

1        DEFINITIONS

1.1      In this Memorandum:

         "AFFILIATE" means any firm, person or company which controls, is
         controlled by or is under common control with a Party to this Agreement
         and for the purpose of this definition the term "control" means the
         ownership either directly or indirectly of more than 50% of the voting
         securities of such firm, person or company;

                                       60
<PAGE>

         "COMPOUND" means the compound troxacitabine;

         "FIELD" means use of the Licensed Product in the treatment of cancer;

         "LICENSED PRODUCT" means any pharmaceutical formulations that contain
         the Compound alone as a therapeutically active ingredient, or in
         combination with any other pharmaceutically active ingredient;

         "LICENSED TECHNOLOGY" shall mean all designs, technical information,
         know-how, knowledge, data, specifications, test results and other
         information, whether or not patented, which are licensed by UGARF and
         Yale under the Head Licence and are useful for the development,
         commercialization, manufacture, use or sale of any Licensed Product;

         "UNIVERSITY" means UGARF or Yale or collectively UGARF and Yale as the
         case may be; and

         "UNIVERSITY PATENTS" means the patents and patent applications set out
         in Part III of Schedule 2 and including, any divisionals, extensions,
         reissues, re-examinations, continuations, and foreign counterparts
         thereof and patents issuing thereon;

1.2      In this Memorandum, unless the context requires otherwise:

         (a)      the headings are included for convenience only and shall not
                  affect its construction;

         (b)      references to "persons" includes individuals, bodies corporate
                  (wherever incorporated), unincorporated associations and
                  partnerships;

         (c)      words denoting the singular shall include the plural and vice
                  versa;

         (d)      words denoting one gender shall include each gender and all
                  genders; and

         (e)      any reference to an enactment or statutory provision is a
                  reference to it as it may have been, or may from time to time
                  be amended, modified, consolidated or re-enacted.

2        AGREEMENT TO GRANT LICENCE

2.1      Subject to clause 2.2, the parties agree that, in the event the
         University terminates the Head Licence, and provided that the reason
         for such termination does not relate in any way to any act or omission
         of the Sub-Licensee, its Affiliates, representatives or sub-licensees,
         the University shall grant the Sub-Licensee (or its nominated
         Affiliate), from the date of such termination, an exclusive worldwide
         licence under the University Patents and Licensed Technology to
         develop, manufacture, have manufactured, use, sell, offer for sale,
         import and supply the Licensed Product in the Field on the same
         financial terms as the Head Licence and substantially similar due
         diligence and other terms as those contained in the Shire Licence ("NEW
         LICENCE").

                                       61

<PAGE>

2.2      This Agreement and the grant of any licence under the University Patent
         and Licensed Technology pursuant to clauses 2.1, shall in all respects
         be conditional upon the University receiving the following:

         (a)      written notice from Shire, confirming that the Sub-Licensee is
                  in compliance with its obligations under the Shire Licence;

         (b)      copies of any arrangements, agreements or related transactions
                  (and any amendments thereto) between the Sub-Licensee and
                  Shire relating to the Licensed Product or any rights licensed
                  to the Sub-Licensee under the Shire Licence;

         (c)      written representation from Sub-Licensee, confirming that the
                  Sub-Licensee is in compliance with its obligations under the
                  Shire Licence;

         (d)      a detailed written update on the development and
                  commercialization of the Licensed Product that shall include,
                  without limitation, a summarized budget for development plan
                  expenses;

         (e)      documentary evidence confirming, to the University's
                  reasonable satisfaction, that the Sub-Licensee has sufficient
                  funds to carry on the development or commercialization of the
                  Licensed Product for not less than [...***...] months; and

         (f)      copies of agreements between the Sub-Licensee and any third
                  party relating to the sublicense of the rights granted to the
                  Sub-Licensee (or any part of such rights) under the Shire
                  Licence.

2.3      If each of the conditions precedent identified in clause 2.2 are not
         fulfilled (unless waived by the University) within 60 days of the
         termination of the Head Licence, the University shall have no
         obligation to the Sub-Licensee to grant the licence under clause 2.1,
         and neither party shall have a claim of any nature whatsoever against
         the other party under this Agreement.

2.4      The Sub-Licensee undertakes to use all reasonable efforts to ensure
         that the conditions precedent in clause 2.2 are fulfilled as soon as
         reasonably practicable following termination of the Head Licence, and
         in any event within 60 days from the date of termination of the Head
         Licence.

2.5      Yale and UGARF shall notify Sub-Licensee if a notice of termination of
         the Head Licence has been provided to Shire and the parties shall
         promptly meet to discuss in good faith to arrange for the finalisation
         and execution of the New Licence.

2.6      Yale and UGARF each agree that activities of the Sub-Licensee, its
         Affiliates and sublicensees shall constitute activities of Shire for
         the purposes of Article 3 of the Head License.

                                       62    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

3        FURTHER ASSURANCES

3.1      Each party shall do all acts and execute all documents as may be
         reasonably necessary to give effect to the grant of the New Licence and
         the exercise of the rights granted therein.

4        LAW AND JURISDICTION

4.1      This Memorandum and the obligations of the Parties shall be governed by
         and construed in accordance with the laws of the state of New York and
         subject to the jurisdiction of the New York courts.

AGREED by the parties through their duly authorised representations on the date
written above:

SIGNED for and on behalf of      )       /s/ Gordhan L. Patel
UNIVERSITY OF GEORGIA            )       ---------------------------------------
RESEARCH FOUNDATION, INC.        )
                                         Gordhan L. Patel, Executive Vice
                                         President
                                         ---------------------------------------
                                         PRINT NAME AND TITLE

SIGNED for and on behalf of      )       /s/ Jon Soderstrom
YALE UNIVERSITY                  )       ---------------------------------------
                                 )
                                         Jon Soderstrom, Managing Director, OCR
                                         ---------------------------------------
                                         PRINT NAME AND TITLE

SIGNED for and on behalf of      )       /s/ Tim Harris
STRUCTURAL GENOMIX, INC.         )       ---------------------------------------
                                 )
                                         CEO
                                         ---------------------------------------
                                         PRINT NAME AND TITLE

                                       63
<PAGE>

                                   SCHEDULE 1
                             THE UNIVERSITY PATENTS

COMPOUNDS AND METHODS FOR THE TREATMENT OF CANCER

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       64    ***CONFIDENTIAL TREATMENT REQUESTED
<PAGE>

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

COMPOUNDS AND METHODS FOR THE TREATMENT OF CANCER

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
</Table>

                                       65    ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

                                   SCHEDULE 8

                          DISPUTE RESOLUTION PROCEDURE

1.       NEGOTIATION

1.1      Representatives of the Parties shall, within 10 Business Days of
         receipt of a written request from either Party, convene a meeting of
         the Development Committee (with additional members from each Party as
         appropriate for the particular dispute) to discuss and in good faith
         try to resolve any claim, dispute, controversy, or disagreement between
         the Parties arising out of or in connection with the terms (or
         interpretation of the terms) of this Agreement (DISPUTE) without
         recourse to legal proceedings.

1.2      If resolution of the Dispute does not occur within 20 Business Days
         from the Development Committee meeting, the matter shall be escalated
         for determination by the respective Group Legal Counsel or heads of
         applicable business units of the Parties (OFFICERS) who may resolve the
         matter themselves or jointly appoint a mediator. The Officers shall
         negotiate in good faith to achieve a resolution of the Dispute referred
         to them within 20 Business Days after such notice is received.

1.3      If the Officers are unable to settle the Dispute between themselves
         within 20 Business Days from referral, the Officers shall report to the
         Parties on the progress of the negotiations in writing and the Dispute
         shall then be referred to mediation in accordance with sections 2.1 -
         2.4.

2.       MEDIATION

2.1      If the Parties have failed to resolve the Dispute by negotiation
         pursuant to sections 1.1 - 1.3, the Dispute shall be referred to
         mediation to be resolved in accordance with the rules of the American
         Arbitration Association ("AAA"). The place of the mediation shall be
         New York, United States and the language of the mediation shall be
         English.

2.2      To initiate a mediation, either Party shall give notice in writing
         (NOTICE) to the other Party in accordance with the provisions of clause
         22, requesting.

2.3      If the Dispute is not resolved within 60 days (or such longer period as
         the parties may agree) from the giving of the Notice, or if one of the
         Parties refuses to participate in mediation, the dispute shall be
         referred to arbitration in accordance with the provisions of section 3.

2.4      If Notice is not given prior to the commencement of arbitration, the
         Party commencing the arbitration must serve Notice on the other party
         to the arbitration within 21 days.

3.       ARBITRATION

                                       66
<PAGE>

3.1      If after the procedures set forth in sections 1 and 2, the Dispute has
         not been resolved, either Party may decide to institute arbitration
         proceedings by written notice to that effect to the other Party. Any
         unresolved Dispute shall be referred to and finally resolved by
         arbitration under the Rules of Arbitration of the International Chamber
         of Commerce (ICC) , which rules are deemed to be incorporated by
         reference into this clause.

3.2      The Tribunal shall consist of three arbitrators to be appointed having
         experience in the pharmaceutical industry: Shire and the Licensee shall
         each appoint one arbitrator and the third arbitrator, who shall be the
         Chairman of the tribunal, shall be appointed by the two-Party appointed
         arbitrators.

3.3      The place of arbitration shall be New York and the language of the
         arbitration shall be English.

3.4      Each Party shall bear its own costs and expenses incurred in connection
         with any arbitration proceeding and the Parties shall equally share the
         cost of the mediation and arbitration levied by the AAA or the ICC.

                                       67
<PAGE>

                                   SCHEDULE 9

                                EXCLUDED PATENTS

STEREOSELECTIVE SYNTHESIS OF [...***...]

<Table>
<Caption>
SHIRE REFERENCE     APPL'N DATE       COUNTRY        APPL'N NO.              GRANT DATE   PATENT NUMBER    STATUS       EXP. DATE
------------------- ----------------- -------------- ----------------------- ------------ ---------------  -----------  -----------
<S>                 <C>               <C>            <C>                     <C>          <C>              <C>          <C>
[...***...]
Any patents or patent applications owned or licensed by [...***...]
</Table>

                                       68   ***CONFIDENTIAL TREATMENT REQUESTED

<PAGE>

SHIRE BIOCHEM INC.
2250 Alfred-Nobel Blvd., Suite 500
Ville Saint-Laurent, Quebec  H4S 2C9 Canada
Tel. 514 787-2300  Fax 514 787-2427
www.shire.com

                                                                    (SHIRE LOGO)

                                                                   Claude Perron
                                              Vice President and General Manager
                                            Tel.: 514-787-2345 Fax: 514-787-2428
                                                    e-mail: cperron@ca.shire.com

March 8, 2005                                                         By Courier
                                                                      ----------

Structural GenomiX, Inc
Attention:  Mr. Michael Grey, President
10505 Roselle Street
San Diego, CA 92121
USA

Re: Amendment to the License Agreement
--------------------------------------------------------------------------------

Dear Sir:

We refer to the patent and know how license between Shire BioChem Inc., Shire
Pharmaceutical Development Limited, Tanaud International BV (together SHIRE) and
Structural GenomiX, Inc. (SGX) dated 23 July 2004 as amended (LICENSE
AGREEMENT).

Shire and SGX desire to amend the License Agreement and this letter sets out the
agreed amendment to the License Agreement. All capitalised terms in this letter
shall, unless the context requires otherwise, have the meaning given to them in
the License Agreement.

Shire and SGX agree and acknowledge that from the date of this letter the
License Agreement shall be amended by deleting the definition of "Compound"
under clause 1.1 and replacing it with the following new definition:

         "COMPOUND" means the compound troxacitabine and its prodrugs;

Except as expressly amended by the terms of this letter, the terms and
conditions of the License Agreement shall remain in full force and effect,
unamended.

Please confirm your acceptance of the above amendment to the License Agreement
by signing, dating and returning to Shire a copy of this letter.

Yours faithfully,

/s/ Claude Perron
Claude Perron
Vice President and General Manager

<PAGE>

Amendment to the License Agreement                                       Page 2
--------------------------------------------------------------------------------

Agreed to:                              Agreed to:

/s/ Claude Perron                       /s/ Matthew Emmens
---------------------------------       ----------------------------------------
Claude Perron, Vice President and       Matthew Emmens
General Manager                         Director
For and on behalf of                    For and on behalf of
SHIRE BIOCHEM INC.                      SHIRE PHARMACEUTICAL DEVELOPMENT LIMITED

Agreed to:                              Agreed to:

/s/ Joseph Rus                          /s/ Stephen K. Burley
---------------------------------       ----------------------------------------
Joseph Rus                              Stephen K. Burley
Director                                CSO
For and on behalf of                    For and on behalf of
TANAUD INTERNATIONAL BV                 STRUCTURAL GENOMIX, INC.
<PAGE>

THIS NOVATION AGREEMENT is made the 19th day of January, 2005

BETWEEN:

1.       Shire BioChem Inc. (formerly known as BioChem Pharma Inc.) of 2250
         Alfred-Nobel Blvd., Suite 500, Ville Saint-Laurent, Quebec, H4S 2C9,
         Canada ("SBI");

2.       Tanaud International B.V. of Fred Roekestraat 123, First Floor, 1076 EE
         Amsterdam, The Netherlands ("TANAUD BV");

3.       Structural Genomix, Inc. of 10505 Roselle Street, San Diego, CA 92121,
         U.S.A. ("GENOMIX"); and

4.       Tanaud Ireland Inc. of 2250 Alfred-Nobel Blvd., Suite 500, Ville
         Saint-Laurent, Quebec, H4S 2C9, Canada ("TII").

WHEREAS:

(A)      Pursuant to the Licence (as defined below) SBI, Tanaud BV and TII
         licensed certain patents, technology and know-how to Genomix.

(B)      TII wishes to be released and discharged from the Licence and the
         parties have agreed to release and discharge TII from the Licence upon
         the terms of SBI's undertaking to perform the Licence and be bound by
         its terms and conditions in place of TII.

NOW IT IS AGREED as follows.

1.       DEFINITIONS

         In this agreement:

         "COUNTERPARTIES"           means, together, Genomix and Tanaud BV;

         "EFFECTIVE DATE"           means 1 January 2005; and

         "LICENCE"                  means a patent and know-how licence between
                                    SBI, TII, Tanaud BV and Genomix, dated 23
                                    July 2004 a copy of which is annexed hereto
                                    and initialled by the parties for the
                                    purposes of identification only.

2.       SBI'S UNDERTAKING

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, SBI hereby
         undertakes to observe, perform, discharge, assume liabilities under and
         be bound by the Licence as if SBI had taken the place of TII under the
         Licence. Notwithstanding this undertaking, nothing in this agreement
         shall:

         (A)      require SBI to perform any obligation created by or arising
                  under the Licence falling due for performance, or which should
                  have been performed by TII, before the Effective Date or to
                  make any payments due or as otherwise would be incurred and
                  payable by Tll prior to the Effective Date; or

         (B)      make SBI liable for any act, neglect, default, omission or
                  liability in respect of the Licence committed or incurred by
                  TII or occurring before the Effective Date.

<PAGE>

                                       2

3.       COUNTERPARTIES' UNDERTAKINGS AND RELEASE OF TII

3.1      With effect from the Effective Date and in consideration of and subject
         to the undertakings given by SBI in clause 2 and TII in clause 4, the
         Counterparties hereby:

         (A)      release and discharge TII from all liabilities under the
                  Licence and all obligations to observe, perform, discharge and
                  be bound by the Licence;

         (B)      accept SBI's undertaking to observe, perform, discharge,
                  assume liabilities under and be bound by the Licence (such
                  undertaking being set out in clause 2); and

         (C)      agree to observe, perform, discharge, assume liabilities under
                  and be bound by the Licence as if SBI had taken the place of
                  TII under the Licence.

3.2      Notwithstanding the provisions of sub-clause 3.1(A), nothing in this
         agreement shall affect or prejudice any claim or demand whatsoever
         which the Counterparties may have against TII in relation to the
         Licence and arising out of matters prior to the Effective Date.

4.       TII'S UNDERTAKING AND RELEASE OF COUNTERPARTIES

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, TII hereby
         releases and discharges the Counterparties from all liabilities under
         the Licence and all obligations to observe, perform, discharge and be
         bound by the Licence. Notwithstanding this undertaking and release,
         nothing in this agreement shall affect or prejudice any claim or demand
         whatsoever which TII may have against the Counterparties in relation to
         the Licence and arising out of matters prior to the Effective Date.

5.       COUNTERPARTS

5.1      This agreement may be executed in any number of counterparts, and by
         the parties on separate counterparts, but shall not be effective until
         each party has executed at least one counterpart.

5.2      Each counterpart shall constitute an original of this agreement, but
         all the counterparts shall together constitute but one and the same
         instrument.

<PAGE>

                                       3

6.       GOVERNING LAW

         This agreement shall be governed by and construed in accordance with
         the laws of the state of New York and subject to the jurisdiction of
         the New York courts.

IN WITNESS WHEREOF the parties have entered into this agreement on the date
first written above.

/s/ [Illegible]
-------------------------------------------------
For and on behalf of SHIRE BIOCHEM INC.

/s/ [Illegible]
-------------------------------------------------
For and on behalf of TANAUD INTERNATIONAL B.V.

/s/ M. Grey
-------------------------------------------------
For and on behalf of STRUCTURAL GENOMIX, INC.

/s/ [Illegible]
-------------------------------------------------
For and on behalf of TANAUD IRELAND INC.

<PAGE>

THIS NOVATION AGREEMENT is made the 19th day of January, 2005

BETWEEN:

1.       Shire BioChem Inc. (formerly known as BioChem Pharma Inc.) of 2250
         Alfred-Nobel Blvd., Suite 500, Ville Saint-Laurent, Quebec, H4S 2C9,
         Canada ("SBI");

2.       Tanaud International B.V. of Fred Roekestraat 123, First Floor, 1076 EE
         Amsterdam, The Netherlands ("TANAUD BV");

3.       Structural Genomix, Inc. of 10505 Roselle Street, San Diego, CA 92121,
         U.S.A. ("GENOMIX"); and

4.       Shire Intellectual Property SrI of Chancery House, High Street,
         Bridgetown, Barbados, West Indies ("SIP").

WHEREAS:

(A)      Pursuant to the Licence (as defined below) SBI, Tanaud BV and Tanaud
         Ireland Inc. ("TII") licensed certain patents, technology and know-how
         to Genomix.

(B)      By a prior novation effective as at 1 January 2005, the rights and
         obligations of TII under the Licence (the "TII INTERESTS") were novated
         to SBI, TII being released and discharged from the Licence upon the
         terms of SBI's undertaking to perform the Licence and be bound by its
         terms and conditions in place of TII.

(C)      SBI now wishes to be released and discharged from the Licence to the
         extent of its rights and obligations representing the TII Interests and
         the parties have agreed to so release and discharge SBI from the
         Licence upon the terms of SIP's undertaking to perform the Licence and
         be bound by its terms and conditions in place of SBI in respect of the
         TII Interests.

NOW IT IS AGREED as follows.

1.       DEFINITIONS

         In this agreement:

         "COUNTERPARTIES"           means, together, Genomix and Tanaud BV;

         "EFFECTIVE DATE"           means 4 January 2005; and

         "LICENCE"                  means a patent and know-how between SBI,
                                    TII, Tanaud BV and Genomix, dated 23 July
                                    2004 a copy of which is annexed hereto and
                                    initialled by the parties for the purposes
                                    of identification only.

2.       SIP'S UNDERTAKING

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, SIP hereby
         undertakes to observe, perform, discharge, assume liabilities under and
         be bound by the Licence as if SIP were a party to the Licence in place
         of SBI in respect of the TII Interests only. Notwithstanding this
         undertaking, nothing in this agreement shall:

         (A)      require SIP to perform any obligation created by or arising
                  under the Licence falling due for performance, or which should
                  have been performed, before the Effective Date or to

<PAGE>
                                       2

                  make any payments due or as otherwise would be incurred and
                  payable prior to the Effective Date; or

         (B)      make SIP liable for any act, neglect, default, omission or
                  liability in respect of the Licence committed or incurred by
                  SBI or occurring before the Effective Date.

3.       COUNTERPARTIES' UNDERTAKINGS AND RELEASE OF SBI

3.1      With effect from the Effective Date and in consideration of and subject
         to the undertakings given by SIP in clause 2 and SBI in clause 4, the
         Counterparties hereby:

         (A)      release and discharge SBI, in respect of the TII Interests
                  only, from all liabilities under the Licence and all
                  obligations to observe, perform, discharge and be bound by the
                  Licence;

         (B)      accept SIP's undertaking to observe, perform, discharge,
                  assume liabilities under and be bound by the Licence (such
                  undertaking being set out in clause 2); and

         (C)      agree to observe, perform, discharge, assume liabilities under
                  and be bound by the Licence as if SIP were a party to the
                  Licence in the place of SBI in respect of the TII Interests.

3.2      Notwithstanding the provisions of sub-clause 3.1(A), nothing in this
         agreement shall affect or prejudice any claim or demand whatsoever
         which the Counterparties may have against SBI, in respect of the TII
         Interests, in relation to the Licence and arising out of matters prior
         to the Effective Date.

4.       SBI'S UNDERTAKING AND RELEASE OF COUNTERPARTIES

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, SBI hereby
         releases and discharges the Counterparties from all liabilities under
         the Licence and all obligations to observe, perform, discharge and be
         bound by the Licence. Notwithstanding this undertaking and release,
         nothing in this agreement shall affect or prejudice any claim or demand
         whatsoever which SBI may have against the Counterparties in relation to
         the Licence and arising out of matters prior to the Effective Date.

5.       NOTICES

         For the purposes of all provisions in the Licence concerning the
         service of notices, the address of SIP is its principal place of
         business set out above.

6.       COUNTERPARTS

6.1      This agreement may be executed in any number of counterparts, and by
         the parties on separate counterparts, but shall not be effective until
         each party has executed at least one counterpart.

6.2      Each counterpart shall constitute an original of this agreement, but
         all the counterparts shall together constitute but one and the same
         instrument.

<PAGE>
                                       3

7.       GOVERNING LAW

         This agreement shall be governed by and construed in accordance with
         the laws of the state of New York and subject to the jurisdiction of
         the New York courts.

IN WITNESS WHEREOF the parties have entered into this agreement on the date
first written above.

/s/ [Illegible]
-----------------------------------------------------
For and on behalf of SHIRE BIOCHEM INC.

/s/ [Illegible]
-----------------------------------------------------
For and on behalf of TANAUD INTERNATIONAL B.V.

/s/ M. Grey
-----------------------------------------------------
For and on behalf of STRUCTURAL GENOMIX, INC.

/s/ [Illegible]
-----------------------------------------------------
For and on behalf of SHIRE INTELLECTUAL PROPERTY SRI

<PAGE>

THIS NOVATION AGREEMENT is made the 19th day of January, 2005

BETWEEN:

1.       Shire BioChem Inc. (formerly known as BioChem Pharma Inc.) of 2250
         Alfred-Nobel Blvd., Suite 500, Ville Saint-Laurent, Quebec, H4S 2C9,
         Canada ("SBI");

2.       Tanaud International B.V. of Fred Roekestraat 123, First Floor, 1076 EE
         Amsterdam, The Netherlands ("TANAUD BV");

3.       Structural Genomix, Inc. of 10505 Roselle Street, San Diego, CA 92121,
         U.S.A. ("GENOMIX");

4.       Shire Intellectual Property SrI of Chancery House, High Street,
         Bridgetown, Barbados, West Indies ("SIP"); and

5.       Shire Pharmaceutical Development Limited to Hampshire International
         Business Park, Chineham, Basingstoke, Hampshire, RG24 8EP, U.K.
         ("SPD").

WHEREAS:

(A)      Pursuant to the Licence (as defined below) SBI, Tanaud BV and Tanaud
         Ireland Inc. ("TII") licensed certain patents, technology and know-how
         to Genomix.

(B)      By a prior novation effective as at 1 January 2005, the rights and
         obligations of TII under the Licence (the "TII INTERESTS") were novated
         to SBI, TII being released and discharged from the Licence upon the
         terms of SBI's undertaking to perform the Licence and be bound by its
         terms and conditions in place of TII.

(C)      By a prior novation effective as at 4 January 2005, SBI was released
         and discharged from the Licence to the extent of its rights and
         obligations representing the TII Interests and the parties agreed to
         release and discharge SBI from the Licence upon the terms of SIP's
         undertaking to perform the Licence and be bound by its terms and
         conditions in place of SBI in respect of the TII Interests.

(D)      SIP now wishes to be released and discharged from the Licence to the
         extent of its rights and obligations representing the TII Interests and
         the parties have agreed to release and discharge SIP from the Licence
         upon the terms of SPD's undertaking to perform the Licence and be bound
         by its terms and conditions in place of SIP in respect of the TII
         Interests.

NOW IT IS AGREED as follows.

1.       DEFINITIONS

         In this agreement:

         "COUNTERPARTIES"           means, together, Genomix and Tanaud BV;

         "EFFECTIVE DATE"           means 4 January 2005; and

         "LICENCE"                  means a patent and know-how licence between
                                    SBI, TII, Tanaud BV and Genomix, dated 23
                                    July 2004 a copy of which is annexed hereto
                                    and initialled by the parties for the
                                    purposes of identification only.

<PAGE>

                                       2

2.       SPD'S UNDERTAKING

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, SPD hereby
         undertakes to observe, perform, discharge, assume liabilities under and
         be bound by the Licence as if SPD were a party to the Licence in place
         of SIP in respect of the TII Interests only. Notwithstanding this
         undertaking, nothing in this agreement shall:

         (A)      require SPD to perform any obligation created by or arising
                  under the Licence falling due for performance, or which should
                  have been performed, before the Effective Date or to make any
                  payments due or as otherwise would be incurred and payable
                  prior to the Effective Date; or

         (B)      make SPD liable for any act, neglect, default, omission or
                  liability in respect of the Licence committed or incurred by
                  SBI or occurring before the Effective Date.

3.       COUNTERPARTIES' UNDERTAKINGS AND RELEASE OF SIP

3.1      With effect from the Effective Date and in consideration of and subject
         to the undertakings given by SPD in clause 2 and SIP in clause 4, the
         Counterparties hereby:

         (A)      release and discharge SIP from all liabilities under the
                  Licence and all obligations to observe, perform, discharge and
                  be bound by the Licence;

         (B)      accept SPD's undertaking to observe, perform, discharge,
                  assume liabilities under and be bound by the Licence (such
                  undertaking being set out in clause 2); and

         (C)      agree to observe, perform, discharge and be bound by the
                  Licence as if SPD were a party to the Licence in the place of
                  SIP in respect of the TII Interests.

3.2      Notwithstanding the provisions of sub-clause 3.1(A), nothing in this
         agreement shall affect or prejudice any claim or demand whatsoever
         which the Counterparties may have against SIP in respect of the TII
         Interests, in relation to the Licence and arising out of matters prior
         to the Effective Date.

4.       SIP'S UNDERTAKING AND RELEASE OF COUNTERPARTIES

         With effect from the Effective Date and in consideration of the
         undertakings given by the Counterparties in clause 3, SIP hereby
         releases and discharges the Counterparties from all liabilities under
         the Licence and all obligations to observe, perform, discharge and be
         bound by the Licence. Notwithstanding this undertaking and release,
         nothing in this agreement shall affect or prejudice any claim or demand
         whatsoever which SIP may have against the Counterparties in relation to
         the Licence and arising out of matters prior to the Effective Date.

5.       FURTHER ASSURANCE

         The parties (including any successors in business or assignees under
         the Licence) agree, at their own cost, to enter into and execute a
         novation agreement in a form substantially similar to this agreement to
         effect the transfer of the TII Interests to SIP (or its nominee which
         shall be a subsidiary of Shire Pharmaceuticals Group plc), thereby
         discharging and releasing SPD from the effective date of such novation
         from its obligations and liabilities under the Licence and substituting
         SIP (or its nominee) as the primary obligor in respect of the TII
         Interests, such agreement to be executed on or to take effect from 1
         January 2010.

<PAGE>

                                       3

5.2      In the event the TII Interests are novated to a nominee of SIP ("SIP
         Nominee") pursuant to clause 5.1 the parties (including any successors
         in business or assignees under the Licence) further agree, when
         requested to do so by SIP and at their own cost, to enter into and
         execute a further novation agreement in a form substantially similar to
         this agreement to effect the transfer of the TII Interests to SIP,
         thereby discharging and releasing the SIP Nominee from the effective
         date of such novation from its obligations and liabilities under the
         Licence and substituting SIP as the primary obligor in respect of the
         TII interests.

6.       NOTICES

         For the purposes of all provisions in the Licence concerning the
         service of notices, the address of SPD is its principal place of
         business set out above.

7.       COUNTERPARTS

7.1      This agreement may be executed in any number of counterparts, and by
         the parties on separate counterparts, but shall not be effective until
         each party has executed at least one counterpart.

7.2      Each counterpart shall constitute an original of this agreement, but
         all the counterparts shall together constitute but one and the same
         instrument.

8.       GOVERNING LAW

         This agreement shall be governed by and construed in accordance with
         the laws of the state of New York and subject to the jurisdiction of
         the New York courts.

IN WITNESS WHEREOF the parties have entered into this agreement on the date
first written above.

 /s/ [Illegible]
---------------------------------------------------------------
For and on behalf of SHIRE BIOCHEM INC.

/s/ [Illegible]
---------------------------------------------------------------
For and on behalf of TANAUD INTERNATIONAL B.V.

/s/ M. Grey
---------------------------------------------------------------
For and on behalf of STRUCTURAL GENOMIX, INC.

/s/ [Illegible]
---------------------------------------------------------------
For and on behalf of SHIRE INTELLECTUAL PROPERTY SRI

/s/ [Illegible]
---------------------------------------------------------------
For and on behalf of SHIRE PHARMACEUTICAL DEVELOPMENT LIMITED

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