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Development Agreement - Medisorb Technologies International LP and Janssen Pharmaceutica International

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                             DEVELOPMENT AGREEMENT

MEDISORB TECHNOLOGIES INTERNATIONAL  L.P. ("Medisorb"), a Delaware limited
partnership, doing business at 6954 Cornell Road, Cincinnati, Ohio 45242, and
JANSSEN PHARMACEUTICA INTERNATIONAL, a division of Cilag International AG,
("Janssen"), a Swiss business corporation, doing business at Kollerstrasse 38,
CH-6300 Zug 6, Switzerland, agree this 23 rd day of December, 1993 to jointly
                                       --           --------                 
develop the products described herein under the following terms and conditions:


1.   Background
     ----------

     Janssen desires to develop a depot formulation of [ ]. Medisorb possesses
     technology and expertise relating to bioabsorbable polymer technologies and
     drug delivery systems for biologically active compounds based on such
     polymers. In light of these facts, Medisorb and Janssen's Affiliate entered
     into a preliminary Development Agreement (dated 9 June 1992) in order to
     collaborate in determining the feasibility of developing a depot
     formulation of [ ]. Janssen has executed the option as specified in the
     said preliminary Development Agreement and both parties agree to continue
     the development of Product under the terms and conditions specified
     hereinafter.


2.   Definitions
     -----------

     A)  Affiliate: shall mean any company controlling, controlled by, or under
                    common control with a party by ownership, directly or
                    indirectly, of fifty percent (50%) or more of the total
                    ownership or by the power to control the policies and
                    actions of such company.

     B)  Field:     shall mean human [                   ] products comprising
                    polymers of lactic and glycolic acids.  In this regard [
                    .]

     C)   International Registration Dossier ("IRF"):

               shall mean the Product registration file compiled by Janssen
               Pharmaceutica N.V., Beerse, Belgium on behalf of Janssen, the
               contents and format being such that it can be submitted as such
               to national health authorities or be used as a basis for a
               national application for marketing authorization for the Products
               in the specific format required by such national health
               authorities.

     D)   Patents:  shall mean (i) any and all existing issued patents and
patent applications or parts thereof which describe and claim a depot
formulation of [                   ], or any chemical analogues of [
] with similar physiological activity, based on polymers of lactic and glycolic
acids and the production and use thereof; (ii) any other patents and patent
applications filed by or on behalf of Medisorb, or under which Medisorb has the
rights to grant licenses, which are needed to practice the inventions; and (iii)
any reissues, extensions, substitutions, confirmations, registrations,
revalidations, additions, continuations, continuations-in-part, or divisions of
or to any of the foregoing which are granted hereafter or any additional
protection certificate granted with respect thereto.

THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT 
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE 
SECURITIES AND EXCHANGE COMMISSION.                                           
<PAGE>
 
JANSSEN- MEDISORB                                                         PAGE 2
DEVELOPMENT AGREEMENT

     E)   Products:  shall mean any and all depot formulations of [
], or any chemical analogues of [                   ] with similar physiological
activity, based on polymers of lactic and glycolic acids which are designed to
deliver [                   ], or any of its chemical analogues, over an
extended period.


3.   Development Program
     -------------------

     A)   "Development Program" shall mean the development activities conducted
          by the parties as contemplated hereunder.  The Development Program is
          to be mutually agreed upon from time to time as the parties find
          necessary. Medisorb shall (i) carry out its development activities in
          the Development Program to the currently accepted standards of Good
          Laboratory Practice, and (ii) manufacture human clinical supplies to
          cGMP standards. The Development Program is attached hereto as Exhibit
          A and incorporated herein.

     B)   Janssen will fund Medisorb's activities under the Development Program
          at a cost not to exceed the following projected development costs
          without prior written authorization from Janssen:

               [                                             ]
               [                                             ]
               [                                             ]

          Medisorb will invoice Janssen monthly according to Medisorb's standard
          rates and practices for the actual costs of work performed during the
          immediately preceding month. Payment will be due 30 days from the end
          of the month in which the invoice is received; a late fee of 1.5% per
          month will be added to any outstanding balance not paid when due.

     C)   Medisorb will provide Janssen monthly brief written descriptions of
          the work performed during the preceding month. Upon Janssen's request
          Medisorb will promptly provide Janssen with detailed reports of the
          work already undertaken, in order for Janssen and its Affiliates to
          prepare the health registration applications and the IRF. Medisorb
          will provide to Janssen a final detailed written report on the work
          performed under the Development Program within 30 days of completion
          of the Development Program.

     D)   Janssen will disclose to Medisorb as soon as reasonably practicable
          during the term of this Agreement the following test results from
          experiments employing materials supplied to Janssen by Medisorb: (i)
          bioavailability and bioactivity assays from in vivo tests and (ii) any
          results which reasonably suggest potential adverse consequences in
          humans associated with such materials.

4.   Term and Termination
     --------------------

     A)   The initial term of this Agreement shall commence upon the date first
          above written and continue thereafter until the earlier of (i) the
          completion of the Development Program at the moment of finalization of
          the IRF, which is expected during the [                   ], or (ii) [
          ], unless earlier terminated pursuant to the provisions of this
          Section 4 or according to the terms of Section 16 below. However, in
          the event that the IRF has not been completed by [
          ], if Janssen can show due diligence, this Agreement shall not
          terminate and will be extended for such period as Janssen requires to
          finalize the IRF, provided that during such extension Janssen
          continues to show due diligence. Due diligence, amongst other factors,
          shall mean the timely filing of required regulatory applications,

THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL TREATMENT 
REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION.                                           
<PAGE>
 
JANSSEN-MEDISORB                                                         PAGE 3

          including, without limitation, a CTX (clinical trial exemption
          certificate) and/or IND, and continuing to fund the Development
          Program in a commercially reasonable manner.

     B)   Janssen may terminate this Agreement upon 30 days written notice,
          provided that Janssen must fulfill all obligations to Medisorb
          actually incurred prior to the notice of termination.

     C)   Medisorb may only terminate this Agreement upon 30 days written notice
          for cause, which shall include:

          1.   Any material breach of this Agreement by Janssen which has not
               been cured within 30 days of written notice of the breach; and

          2.   The failure of Janssen to provide within 60 days of a request by
               Medisorb reasonably sufficient quantities of [
               ] as will be required by Medisorb to fulfill its obligations
               hereunder.

     D)   Articles 8, 9, 10, 11, 12 and 17 shall survive termination of this
          Agreement.


5.   Exclusivity and Right of First Refusal
     --------------------------------------

     A)   This Agreement shall be exclusive with respect to both parties
          obligations in the Field.

     B)   With respect to Products in the Field intended to treat [
          ] the development of which is not being currently pursued and/or
          funded by Janssen shall be subject to the following right of first
          refusal.  With respect to products in the Field which are subject to
          this right of first refusal,  Medisorb shall provide written notice to
          Janssen of Medisorb's intent to enter into substantive negotiations
          with a third party for the development of such a product.  Medisorb's
          notice shall, to the fullest permissible extent, disclose to Janssen
          the details of the proposed product and its application(s).  Medisorb
          shall not be required to disclose the identity of the third party.
          Janssen shall have 60 days following the notice required above from
          Medisorb to inform Medisorb of its intent to enter into substantive
          negotiations with Medisorb for the development of a product in the
          same application(s).  In the event that Janssen does not elect to
          enter into such negotiations with Medisorb within the 60 day period,
          Medisorb shall thereafter be free to enter into development, licensing
          and/or supply contracts with third parties respecting the product
          which was the subject of Medisorb's original notice to Janssen.  In
          the event that Janssen elects to enter into substantive negotiations
          with Medisorb and the parties are unable, despite their mutual good
          faith efforts, to negotiate and enter into the subject agreements
          within 120 days from Medisorb's original notice to Janssen, Medisorb
          shall thereafter be free to enter into development, licensing and/or
          supply contracts with third parties respecting the product which was
          the subject of Medisorb's original notice to Janssen.  Medisorb agrees
          that whenever it would not have been possible to execute such an
          agreement with such third party within a period of twelve months, the
          right of first refusal granted to Janssen will be restored.

6.   Option
     ------

     A)   Medisorb hereby grants to Janssen an option, exercisable at any time
          during the period beginning with the finalization of the IRF and 30
          days thereafter (except as modified by Section 6(B) below), to enter
          into the License Agreements (i.e., the first a worldwide license,

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
JANSSEN-MEDISORB                                                          PAGE 4
DEVELOPMENT AGREEMENT

          excluding the United States, and the second a license encompassing
          only the United States) attached hereto as Exhibits B & C,
          respectively.

     B)   The option granted to Janssen under Section 6(A) above shall be
          immediately exercisable upon the termination of this Agreement by
          Janssen due to material breach by Medisorb.


7.   Future Supply
     -------------

     A)   In the event that Janssen and Medisorb enter into the License
          Agreements referred to in Section 6 above, the parties agree that it
          is likely that either Janssen or Medisorb will manufacture Product(s)
          for commercial sale. Therefore the parties are negotiating the
          definitive terms of two Product Manufacturing Agreements (i.e., the
          first a worldwide agreement, excluding the United States, and the
          second encompassing only the United States) which shall be appended
          hereto as Exhibits D & E respectively, and which will be executed at
          the moment of executing the License Agreements, unless Janssen elects
          to manufacture the Product itself as specified hereafter.  The parties
          each covenant to use their best efforts to expeditiously negotiate the
          definitive Manufacturing Agreements referred to in this Section 7(A).

          It is understood and agreed upon that Janssen and its Affiliates shall
          retain sole discretion at the time of entering in to the License
          Agreements under Section 6 to choose to manufacture or have
          manufactured Product(s).  In the event that Janssen determines to
          manufacture Product(s) itself or have Product(s) manufactured by a
          third party, the terms of the License Agreements (Appendices B and C
          to this Agreement) shall control the transfer of the required
          technology from Medisorb to Janssen.

     B)   With respect to third party suppliers, except as limited by the
          Product Manufacturing Agreements, Medisorb will have a right of first
          refusal as to the manufacture and supply to Janssen of all Product(s),
          and component bioabsorbable polymers thereof, developed under this
          Agreement. Medisorb will have a period of thirty days following
          written notice from Janssen of terms it is offering to, or prepared to
          accept from, third parties to notify Janssen of its intention to
          exercise its right of first refusal to supply Product or component
          bioabsorbable polymers thereof to Janssen, its Affiliates and
          Licensees on terms no less favorable to Janssen than those offered by
          such third party supplier.


8.   Proprietary Rights
     ------------------

     A)   Medisorb will retain title to and ownership of all technology
          (including, without limitation, all patents, inventions, and data
          relating thereto) relating to absorbable polymers, controlled release
          of active agents, and/or manufacturing methods or processes relating
          to such polymers and the controlled delivery systems for active agents
          based on such polymers previously owned by Medisorb or developed by
          Medisorb as a result of the Development Program or otherwise. Medisorb
          will pay its own costs and expenses in connection with the protection
          of any such technology, including all patent application and
          maintenance costs and Janssen agrees to provide Medisorb with any
          necessary utility information.

          Medisorb shall inform Janssen of any patent application it wishes to
          file to protect proprietary rights defined in Article 8, resulting
          from either the Development Program or the preliminary

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
JANSSEN-MEDISORB                                                          PAGE 5
DEVELOPMENT AGREEMENT

          Development Program and shall forward a copy of any such patent
          application to Janssen at least one month prior to filing.

          Medisorb shall consider any suggestions made by Janssen for amplifying
          such application and shall accordingly amend the application where in
          Medisorb's opinion it is appropriate.

          Nine months after the first filing, Medisorb shall propose a list of
          countries in which it intends to file foreign equivalents. Janssen
          shall be given the opportunity to propose further countries to be
          added to the list. In case the adding of some or all of these further
          countries is unacceptable  to Medisorb, Janssen shall have the right
          to file patent applications in those countries, in Medisorb's name and
          at Janssen expense. Medisorb shall assist in the transfer of rights
          for the latter patent applications and shall provide all information
          necessary to file and prosecute such patent applications.

          Medisorb shall not abandon part or whole of any of the patents or
          patent applications without having first consulted Janssen, which
          shall have the right to further pursue any patents or patent
          applications which Medisorb wishes to abandon, or parts thereof, in
          its own name and at its own expense.

     B)   Janssen and/or its Affiliate will retain title to and ownership of all
          technology (including, without limitation, all patents, inventions,
          and data relating thereto) relating to [                 ] or any
          chemical analogues of [                   ] with similar physiological
          activity previously owned by Janssen and/or its Affiliate or developed
          by Janssen as a result of this Agreement or otherwise. Janssen and/or
          its Affiliate will pay its own costs and expenses in connection with
          the protection of any such technology, including all patent
          application and maintenance costs and Medisorb agrees to provide
          Janssen with any necessary utility information.

     C)   Any inventions, other than those falling under either section 8(A) or
          8(B) hereof, having an inventorship jointly between at least one
          employee of Janssen or an Affiliate of Janssen and one employee of
          Medisorb or an Affiliate of Medisorb shall be jointly-owned by Janssen
          and Medisorb.  Each party will cooperate fully in the filing and
          prosecution of such patent applications.

          Janssen and Medisorb shall agree on which of both shall be responsible
          for the filing, prosecution and maintenance of any such joint patent
          applications and patents (hereinafter referred to as the "Responsible
          Party"). In principle, the party having contributed the most to the
          invention to be protected shall be the responsible party, unless
          agreed upon differently. Upon mutual consent, the responsible party
          may select an agent for drafting, filing and prosecuting a joint
          application. However, both parties shall agree who shall be the agent
          and to what extent this agent shall be used.

          The Responsible Party shall consult the other party when drafting any
          new jointly owned patent application. The final draft shall be
          forwarded to the other party at least one month prior to filing to
          give the opportunity to make final comments.

          The Responsible Party shall propose a list of countries in which it
          intends to file such patent applications. The other party shall be
          given the opportunity to propose further countries to be added to the
          list. In case the adding of some or all of these further countries is
          unacceptable to the Responsible Party, the other party shall have the
          right to file patent applications in those countries, in its own name
          and at its own expense. The Responsible Party shall assist in the

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
JANSSEN-MEDISORB                                                          PAGE 6
DEVELOPMENT AGREEMENT

          transfer of rights for the latter patent applications and shall
          provide all information necessary to file and prosecute such patent
          applications.

          The Responsible Party shall not abandon part or whole of any of the
          patents or patent applications without having first consulted the
          other party, which shall have the right to further pursue any patents
          or patent applications which the responsible party wishes to abandon,
          or parts thereof, in its own name and at its own expense.

          All out-of-pocket costs made in relation to joint patent applications
          and patents shall be shared equally by Janssen and Medisorb. A
          statement of costs shall be made up on a quarterly basis and invoiced
          to the other party.

          Medisorb shall grant to Janssen an exclusive fully-paid up royalty
          free license with the right to sublicense to make, have made, use and
          sell under any such patents or patent applications for the duration of
          the patents, any continuations, continuations in part, divisions,
          patents of addition, reissues, renewals or extensions thereof or any
          supplementary protection  certificates granted with respect thereto,
          in respect of any claims concerning the application of [
          ] or any chemical analogues of [                   ] with similar
          physiological activity. However, nothing contained in this paragraph
          shall obviate Janssen's obligation to pay royalties under Section 6
          hereof with respect to any Products developed hereunder.

          Janssen shall grant to Medisorb an exclusive fully paid-up royalty
          free license with the right to sublicense to make, have made, use and
          sell under any such patents or patent applications for the duration of
          the patents, any continuations, continuations in part, divisions,
          patents of addition, reissues, renewals or extensions thereof or any
          supplementary protection certificates granted with respect thereto, in
          respect of any claims concerning the application of bioabsorbable
          polymers in the field of human and/or veterinary medicine.

     D)   In addition, each party will retain exclusive title to its respective
          Confidential Information (as defined in Section 11 below)


9.   Patent Infringement
     -------------------

     A)   In the event that either party becomes aware that any third party is
          infringing any patents included within the Patents in any country or
          countries, the party becoming aware of such infringement shall
          promptly give notice of such infringement to the other party.  Any
          possible action against such alleged infringement of the Patents will
          be carried out by either or both of the parties in accordance with the
          provisions specified hereinafter in paragraphs B), C), D) and E).

     B)   Whenever it would concern a patent or patent application falling
          within the definition of Patents and of which Medisorb retains full
          title and ownership pursuant to Article 8 A), Medisorb shall use all
          reasonable efforts to take action against such infringement in its own
          name, at its own expense and on its own behalf.

          If Medisorb fails to take action against such infringement, or if
          Medisorb does not use reasonable efforts in carrying out such action
          after commencement thereof, within thirty (30) days after the notice
          referred to in paragraph A) above or after having become aware of such
          infringement, Janssen shall be entitled at its own discretion and at
          its own expense, to take
 
     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
JANSSEN-MEDISORB                                                          PAGE 7
DEVELOPMENT AGREEMENT

          immediate action against such infringement in its own name, at its own
          expense and on its own behalf. If Janssen commences or assumes such
          action, Janssen may credit [                   ] of any royalty
          otherwise due to Medisorb for sales in such country or countries
          against the amount of the expenses and costs of such action, including
          without limitation, attorney fees actually incurred by Janssen.The
          amount of expenses so deducted shall be paid to Medisorb out of the
          recoveries, if any, received by Janssen as a result of such action.
          Except for such repayment of royalties deducted, Janssen shall be
          entitled to retain all recoveries therefrom.

          In no event shall Medisorb settle with such infringing third party in
          the Field without the prior written consent of Janssen.

     C)   Whenever it would concern a patent or patent application falling
          within the definition of Patents and of which Janssen retains full
          title and ownership pursuant to Article 8 B), Janssen shall have the
          right but not the obligation to take action against such infringement
          in its own name, at its own cost and on its own behalf. If Janssen
          fails to take action against such infringement, or if Janssen does not
          use reasonable efforts in carrying out such action after commencement
          thereof, within thirty (30) days after the notice referred to in
          paragraph A) above or after having become aware of such infringement,
          Medisorb shall be entitled at its own discretion and at its own
          expense, to take action against such infringement. Medisorb shall be
          entitled to retain all recoveries, if any, therefrom.

     D)   Whenever it would concern a patent or patent application falling
          within the definition of Patents and of which Janssen and Medisorb
          jointly retain full title and ownership pursuant to Article 8 C), and
          whenever in such case the infringing product would be a drug product
          falling within the definition of the Field, Janssen shall have the
          right but not the obligation to take action against such infringement
          in its own name, at its own cost and on its own behalf. If Janssen
          fails to take action against such infringement, or if Janssen does not
          use reasonable efforts in carrying out such action after commencement
          thereof, within thirty (30) days after the notice referred to in
          paragraph A) above or after having become aware of such infringement,
          Medisorb shall be entitled at its own discretion and at its own
          expense, to take action against such infringement, it being understood
          that Janssen will have a continuing right to take over any such action
          at its own expense and shall pay to Medisorb from any recoveries
          Janssen receives (i) Medisorb's expenses and (ii) from any sums
          remaining after deduction of Medisorb's and Janssen's expenses, an
          amount proportionate to Medisorb's expenses in relation to Janssen's
          expenses.

          Whenever it would concern a patent or patent application falling
          within the definition of Patents and of which Janssen and Medisorb
          jointly retain full title and ownership pursuant to Article 8C), and
          whenever in such case the infringing product would be a drug product
          falling outside the definition of the Field, Medisorb shall have the
          right but not the obligation to take action against such infringement
          in its own name, at its own cost and on its own behalf.If Medisorb
          fails to take action against such infringement, or if Medisorb does
          not use reasonable efforts in carrying out such action after
          commencement thereof, within thirty (30) days after the notice
          referred to in paragraph A) above or after having become aware of such
          infringement, Janssen shall be entitled at its own discretion and at
          its own expense, to take action against such infringement, it being
          understood that Medisorb will have a continuing right to take over any
          such action at its own expense.  If Janssen commences or assumes such
          action, Janssen may credit [                   ] of any royalty
          otherwise payable to Medisorb payable hereunder against the amount of
          the expenses and costs of such action, including without limitation,
          attorney fees actually incurred by Janssen.  The amount of expenses so

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
JANSSEN-MEDISORB                                                          PAGE 8
DEVELOPMENT AGREEMENT

          deducted shall be paid to Medisorb out of the recoveries, if any,
          received by Janssen as a result of such action.  Except for such
          repayment of royalties deducted, Janssen shall be entitled to retain
          all recoveries therefrom.

     E)   Each party agrees to cooperate reasonably with the other party in such
          litigation, including making available to the other party records,
          information, and evidence relevant to the infringement of the Patent.


10.  Third Party Intellectual Property Rights
     ----------------------------------------

     A)   Medisorb warrants that to the best of its current knowledge and belief
          the Products to be developed hereunder will not infringe the patent
          rights of any third party.

     B)   In the event that the manufacture, use or sale of the Product would
          constitute an infringement of the rights of a third party in a country
          because of the use of the Patents or Medisorb's know how, each party
          shall, as soon as it becomes aware of the same, notify the other
          thereof in writing, giving in the same notice full details known to it
          of the rights of such third party and the extent of any alleged
          infringement.  The parties shall after receipt of such notice meet to
          discuss the situation, and, to the extent necessary attempt to agree
          on a course of action in order to permit Janssen to practice the
          license granted hereunder.  Such course of action may include:  (a)
          modifying the Product or its manufacture so as to be noninfringing;
          (b) obtaining an appropriate license from such third party; or (c)
          fight the claimor suit.  In the event that within a short period of
          time, the parties fail to agree on an appropriate course of action
          Janssen may decide upon the course of action in the interest of the
          further development, manufacturing or commercialization of the
          Product.

     C)   In the event that the parties cannot agree on modifying the Product or
          in the case that such modification would not be economically viable or
          regulatorily feasible, Janssen, whenever it relates to know how,
          whether patented or not, owned by Janssen in accordance with the
          provisions of Article 8 B) and C), or Medisorb, whenever it relates to
          know how, whether patented or not, owned by Medisorb in accordance
          with the provisions of Article 8 A), will have the right to negotiate
          with such third party for such license.  Both parties hereto will in
          any event in good faith consult with each other with respect to such
          negotiations and the party negotiating such license as indicated
          above, will make every effort to minimize the amount of license fees
          and royalties payable thereunder.  In no event shall either party as a
          result of such settlement, grant a sublicense or cross license to the
          third party to settle the suit, without the prior written approval of
          the other party.  In the event that such negotiations result in a
          consummated agreement, any license fee and/or royalties to be paid
          thereunder shall be paid by the party responsible for the negotiations
          as indicated above, [                   ] of any license fees or
          royalties paid by Janssen under such license will be creditable
          against royalties due to Medisorb with respect to such country or
          countries.

     D)   In the event that either or both parties would further to such
          notification under Paragraph 10 B) decide to defend such suit or claim
          in which a third party alleges that the manufacture, use or selling of
          the Product infringes said third party's patent in a country, Janssen
          shall have the right to apply [                   ] of the royalties
          due to Medisorb on the sales of the allegedly infringing Product
          against its litigation expenses.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
JANSSEN-MEDISORB                                                          PAGE 9
DEVELOPMENT AGREEMENT

11.  Confidentiality and Disclosure
     ------------------------------

     A)   Each party agrees to keep confidential and to not use for any purpose
          other than as set forth herein all technical information and materials
          supplied by the other hereunder and any information a party may
          acquire about the other or its activities as a result of entering into
          this Agreement, provided that such obligation shall not apply to
          technical information or material which:  (i) was in the receiving
          party's possession without restriction prior to receipt from the other
          party or its Affiliates; (ii) was in the public domain at the time of
          receipt; (iii) becomes part of the public domain through no fault of
          the receiving party; (iv) shall be lawfully received from a third
          party with a right of further disclosure; (v) shall be required to be
          disclosed by law, by regulation or by the rules of any securities
          exchange.

     B)   Except as may be otherwise provided herein, the confidentiality
          obligations as set out in this Section shall continue so long as this
          Agreement remains in force and for 10 years thereafter.

     C)   Licensee shall cause its Affiliates and Sublicensees to enter into
          similar obligations of confidentiality with respect to unpublished
          information within the Patents and Technical Information.


12.  Disclaimer of Warranty
     ----------------------

     Medisorb makes no representations or warranties, express or implied, other
     than those specified in section 13 below, with respect to any services,
     technology, products or materials supplied to Janssen hereunder, including
     without limitation any warranties of merchantability or fitness for a
     particular purpose.


13.  Liability
     ---------

     A)   Janssen agrees to indemnify, defend and hold harmless Medisorb from
          and against any liability, loss, damages and expenses (including
          reasonable attorney fees) Medisorb may suffer as the result of claims,
          demands, costs or judgments which may be made or instituted against
          Medisorb by reason of personal injury or damage to property arising
          out or caused by Janssen's clinical testing of the Product, except
          where such liabilities claims, demands, costs or judgments are caused
          by any sole negligence on behalf of Medisorb in manufacturing the
          clinical trial samples, its failure to supply such samples in
          accordance with the mutually agreed written specifications or its
          failure to provide Janssen with any information as specified in
          Article 13(B). Medisorb will notify Janssen as soon as it becomes
          aware of any such claim or action and agrees to give reasonable
          assistance in the investigation and defense of such claim or action it
          being understood that it shall allow Janssen to control the
          disposition of the same.

     B)   Medisorb agrees to indemnify, defend and hold harmless Janssen from
          and against any liability, loss, damages and expenses (including
          reasonable attorney fees) Janssen may suffer as the result of claims,
          demands, costs or judgments which may be made or instituted against
          Janssen by reason of personal injury or damage to property arising out
          or caused by Medisorb's sole negligence in manufacturing the clinical
          trial samples or its failure to supply such samples in accordance with
          the mutually agreed written specifications.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
JANSSEN-MEDISORB                                                         PAGE 10
DEVELOPMENT AGREEMENT

     C)   In no event shall either party be liable for loss of profits, loss of
          goodwill or any consequential or incidental damages of any kind of the
          other party.

     D)   This indemnification shall not apply with respect to any Product which
          would be commercialized under the terms of the License Agreement or
          manufactured under the terms of the Product Manufacture Agreement with
          respect to which the indemnification clause of such Agreements will
          apply.


14.  Product Information and Adverse Drug Events
     -------------------------------------------

     A)   As Janssen has superior knowledge of the end-use applications to which
          Products developed hereunder will be put, Janssen is responsible for
          providing third parties with adequate information as to the medical
          profile of the Product. Janssen will provide Medisorb with copies of
          the IPID (International Product Information Document) and the IPPI
          (International Patient Package Insert), which are all part of the IRF
          for the Product.  For the purpose of this Agreement IPID refers to the
          document that summarizes all medically relevant features of the
          Product, including the instructions for use meant to inform the
          medical profession, whereas the IPPI is a patient-oriented document,
          based upon the IPID that summarizes all relevant information on the
          Product in lay language.  Janssen will keep Medisorb informed of any
          revisions or amendments in the IPID and IPPI of the Product.

     B)   Medisorb will provide to Janssen promptly after its discovery by
          Medisorb, any information in its possession which indicates adverse
          effects in humans associated with the Products developed hereunder.
          For the purpose of this Agreement "adverse event" shall mean an
          experience which is noxious and unintended and which occurs at doses
          normally used in man for the prophylaxis, diagnosis or therapy of a
          disease or for the modification or physiological functioning and any
          report of an overdose.


15.  Government Approvals
     --------------------

     A)   Janssen shall be responsible for conducting all necessary testing as
          well as determining what, if any, government approvals are required
          for the use and sale of Products developed hereunder and shall comply
          with all such requirements prior to and following the sale or
          distribution of such Products.

          Medisorb shall cooperate fully with Janssen in obtaining regulatory
          approvals for Products developed hereunder and shall, at Janssen's
          request, provide appropriate regulatory authorities with any and all
          information concerning Medisorb's technology, Medisorb polymers and
          manufacturing methods for such Products.

          In this respect Medisorb undertakes that it has submitted or will as
          soon as possible submit a type IV Drug Master File to the FDA
          identifying Medisorb's method of manufacture, release specifications
          and testing methods used in the manufacture of its bioabsorbable
          polymers and a type I Drug Master File of Medisorb's manufacturing
          facilities where Product may be manufactured.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
JANSSEN-MEDISORB                                                         PAGE 11
DEVELOPMENT AGREEMENT

16.  Warranties and Covenants
     ------------------------

     A)   Each party hereto covenants with the other to use its best efforts,
          consistent with reasonable business practice, to perform its
          obligations hereunder in a timely fashion. In the event that Janssen
          determines not to pursue the commercialization of Products, it will
          promptly inform Medisorb of such decision and this Agreement will
          automatically terminate.

     B)   Medisorb warrants to the best of its knowledge that Medisorb
          bioabsorbable polymers are suitable for chronic human use in
          parenteral drug delivery systems similar to Products to be developed
          hereunder.

     C)   Medisorb warrants that to the best of its knowledge the use of
          Medisorb's bioabsorbable polymers in Products will not infringe the
          patent rights of any third parties.


17.  Force Majeure
     -------------

     Neither party shall be liable for its failure to perform any of its
     obligations hereunder if such failure is occasioned by a contingency beyond
     its reasonable control including, but not limited to, occurrences such as
     strikes or other labor disturbances, lock out, riot, war, default by a
     common carrier, fire, flood, storm, earthquake, other acts of God,
     inability to obtain raw materials, failure of plant facilities or
     government regulation, act or failure to act. Each party shall notify the
     other immediately upon occurrence or cessation of any such contingencies.
     If such contingency continues unabated for at least 180 consecutive days,
     either party shall have the right to terminate this Agreement without
     further obligation beyond those actually incurred prior to such
     termination.


18.  Dispute Resolution
     ------------------

     Should any dispute arise under this Agreement, the parties shall first meet
     in an attempt to amicably resolve the situation. In the event that the
     parties are unable to resolve any contested issues, then both parties
     hereby agree to submit said disputes to the jurisdiction of the competent
     Courts of Zurich, Switzerland, and agree that any litigation in any way
     related to this Agreement shall be submitted to such Courts and that same
     shall be subject to Swiss law.


19.  Assignment
     ----------

     This Agreement shall not be assigned by either party without the prior
     written consent of the other party; provided, however, that assignment
     shall be permitted without such consent to any party, not less than 50% of
     the total interest of which owns, is owned by, or is under common control
     with the assigning party. In the event of any such permitted assignment the
     assignee shall be subject to and shall agree in writing to be bound by the
     terms and conditions of this Agreement.


20.  Severability
     ------------

     In the event that any one or more of the provisions of this Agreement
     should for any reason be held by any court or authority having jurisdiction
     over this Agreement or any of the parties hereto to be invalid, illegal or
     unenforceable such provision or provisions shall be validly reformed to as
     nearly approximate

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
JANSSEN-MEDISORB                                                         PAGE 12
DEVELOPMENT AGREEMENT

     the intent of the parties as possible and, if unreformable; shall be
     divisible and deleted in such jurisdiction, elsewhere this Agreement shall
     not be affected, except to the extent such applicability would
     substantially burden only one of the parties to this Agreement.


21.  Separate Entities
     -----------------

     Nothing contained herein shall be construed to constitute the parties
     hereto as partners or joint venturers, or as agents or representatives of
     the other.


22.  Captions
     --------

     The captions of this Agreement are for convenience only, and shall not be
     deemed of any force or effect whatsoever in construing this Agreement.


23.  Waiver
     ------

     Any waiver by either party of a breach of any provision of this Agreement
     shall not operate as or be construed to be a waiver of any further breach
     of the same or other provisions of this Agreement. The failure of a party
     to insist upon strict adherence to any term of this Agreement on one or
     more occasions shall not be considered a waiver or deprive that party of
     the right thereafter to insist upon strict adherence to that term or any
     other term of this Agreement. Any waiver must be in writing.


24.  Press Communications
     --------------------

     Neither Party shall originate any publicity, news release or public
     announcement, written or oral relating to this Agreement, including its
     existence, without the prior written approval of the other party.


25.  Notices
     -------

     Any legal notice required or permitted hereunder shall be considered
     properly given if in writing and sent by first class mail, certified mail
     or by telefacsimile to the party being notified at the respective address
     of such party as follows:

     If to Medisorb:  Medisorb Technologies International L.P.
                      6954 Cornell Road
                      Cincinnati, OH 45242
                      USA
                      Facsimile: 513-489-2348

     If to Janssen:   Janssen Pharmaceutica
                      Kollerstrasse 38
                      6300  Zug 6
                      Switzerland
                      Facsimile: 00-41-42449565

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
JANSSEN-MEDISORB                                                         PAGE 13
DEVELOPMENT AGREEMENT

     Such notice shall be effective upon receipt or upon refusal to accept such
     notice. In any case, notice shall be presumed effective no later than five
     (5) days after such notice is sent.

     Neither party shall originate any publicity, news release or public
     announcement, written or oral, relating to this Agreement, including its
     existence, without the written approval of the other party.


26.  Entire Understanding
     --------------------

     This Agreement may be executed by the parties hereto in counterparts, each
     of which when so executed and delivered shall be considered to be an
     original, but all such counterparts shall together constitute but one and
     the same instrument.  This Agreement constitutes the entire understanding
     between the parties with respect to the subject matter hereof and
     supersedes all previous agreements related thereto, provided, however, that
     no variation or modification of this Agreement or any of the terms hereof
     shall be valid unless in writing and signed by the parties hereto.


WITNESS the signature of both parties by their duly authorized officers:

JANSSEN PHARMACEUTICA  INTERNATIONAL
  A division of Cilag International AG


By: /s/ Erik Rombouts
    -----------------------------
Name: Erik Rombouts
      -----------------------
Title: Business Manager
       -----------------------
Date: January 4, 1994
      -------------------------


{Second Janssen Signatory}
--------------------------


By: /s/ Heinz Schmid
    ----------------------------
Name: Heinz Schmid
      ------------------------
Title: General Manager
       -------------------------
Date: January 4, 1994
      ------------------------------

MEDISORB TECHNOLOGIES INTERNATIONAL  L.P.

by:  Medisorb Technologies
      International, Inc.,
      its General Partner


By: /s/ David R. Lohr
    ----------------------------------
Name:  David R. Lohr
      -------------------------------
Title: President
       -----------------------------------
Date: December 6, 1993
      ---------------------------------

11299302

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
                                   EXHIBIT A
                                   ---------

                              DEVELOPMENT PROGRAM

[



                                                                               ]

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
DEVELOPMENT PROGRAM
Page 2



[



                                                                               ]

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
                                   EXHIBIT B


                            To Development Agreement
                            dated December 23, 1993
                                    between
                      Janssen Pharmaceutica International
                                      and
                    Medisorb Technologies International L.P.


                License Agreement, ex. United States of America
                               Following 16 Pages



    [Note: This exhibit supercedes the previous Exhibit B, document number
                                07069402.doc.]



/s/ Erik Rombouts                 12/12/95
--------------------------------  --------
For JANSSEN                        Date


/s/ David R. Lohr                 December 6, 1995
-------------------------------   ----------------
For MEDISORB                       Date



1205902.doc

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
                               LICENSE AGREEMENT


          This Agreement is made as of the __ day ______ of 19___, between
MEDISORB TECHNOLOGIES INTERNATIONAL L.P., a Delaware limited partnership
(hereinafter "Medisorb") and JANSSEN PHARMACEUTICA INTERNATIONAL, a division of
Cilag International AG, a Swiss business corporation ("Janssen").

          WHEREAS, the parties have entered into a certain Development
Agreement, dated December 23, 1993 (the "Development Agreement"), for the
development of a Product (as described below); and

          WHEREAS, Janssen has an option under the Development Agreement to
enter into this License Agreement for the Medisorb technology required to make,
use and sell the Product, which option Janssen has elected to exercise; and

          WHEREAS, the parties believe that it is in their mutual best interest
for Medisorb to license to Janssen on an exclusive basis in the Territory,
Medisorb Patents and Technical Information within the Field, upon the terms and
conditions set forth herein;

          NOW, IT IS HEREBY AGREED AS FOLLOWS:

          (1) Definitions:  The following terms shall have the meanings ascribed
              -----------                                                       
to them herein, unless the context otherwise requires:

              (a) "Affiliate" shall mean any company controlling, controlled by,
or under common control with a party by ownership, directly or indirectly, of
fifty percent (50%) or more of the total ownership or by the power to control
the policies and actions of such company.

              (b) "Development Program" shall mean the development activities
conducted by the parties pursuant to the Development Agreement.

              (c) "Field" shall mean the treatment of [
 
                        ].

              (d) "Improvements" shall mean any improvements or developments to
or of the Patents and Technical Information in the Field which Medisorb may
acquire, discover, invent, originate, make, conceive or have a right to, in
whole or in part, during the term of this Agreement, whether or not such
improvement or development is patentable.

              (e) "International Registration Dossier" ("IRF") shall mean the
Product registration file compiled by Janssen Pharmaceutica N.V., Beerse,
Belgium on behalf of Janssen, the contents and format being such that it can be
submitted as such to national health authorities or be used as a basis for a
national application for marketing authorization for the Products in the
specific format required by such national health authorities.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                          Page 2
License Agreement

              (f) "Medisorb Polymers" shall mean bioresorbable aliphatic
polyesters based on glycolide, lactide, caprolactone and combinations of such
polymers, which are manufactured by Medisorb and utilized in Product(s) licensed
under this Agreement.

              (g) "Net Sales" shall mean the gross amounts received from sales
of Products during a calendar quarter to third parties by Janssen, its
Sublicensees or any Affiliate of either, less any: (i) applicable sales taxes;
(ii) cash trade or quantity discounts; (iii) amounts repaid or credited by
reason of rejections or return of goods; or (iv) freight, postage and duties
paid for. No deduction from the gross sales price shall be made for any item of
cost incurred by the seller in its own operations incident to the manufacture,
sale or shipment of the product sold. For purposes hereof, Net Sales shall not
include sales of a Product from Janssen or an Affiliate of Janssen to any
Affiliate or Sublicensee of either; it being intended that Net Sales shall only
include sales to unrelated third-parties.

              (h) "Patents" shall mean (i) any and all existing issued patents
and patent applications or parts thereof which describe and claim a depot
formulation of [ ], or any chemical analogues of [ ] with similar physiological
activity, based on polymers of lactic and glycolic acids and the production and
use thereof; (ii) any other patents and patent applications filed by or on
behalf of Medisorb, or under which Medisorb has the rights to grant licenses,
which are needed to practice the inventions; and (iii) any reissues, extensions,
substitutions, confirmations, registrations, revalidations, additions,
continuations, continuations-in-part, or divisions of or to any of the foregoing
which are granted hereafter or any additional protection certificate granted
with respect thereto.

              (i) "Product(s)" shall mean any and all depot formulations of [
], or any chemical analogues of [                   ] with similar physiological
activity, based on polymers of lactic and glycolic acids which are designed to
deliver [                               ], or any of its chemical analogues,
over an extended period.

              (j) "Sublicensees" shall mean any company or companies, other
than Janssen's Affiliates, sublicensed by Janssen.

              (k) "Technical Information" shall mean all unpatented information,
know-how, practical experience, procedures, methodology, specifications,
formulae and data whether or not the same shall be patentable which have been
heretofore developed or acquired by Medisorb prior to the date of this Agreement
and which are necessary in order to use, manufacture or sell Products in the
Field.

               (l) "Territory" shall mean worldwide with the exception of the
United States, its Territories, Protectorates, Commonwealths, and all other
political subdivisions of the United States.

          (2)  License Grant
               -------------

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                          Page 3
License Agreement

              (a) Medisorb hereby grants to Janssen in the Territory an
exclusive license under the Patents and Technical Information existing prior to
the effective date of this Agreement, with the right to grant sublicenses
thereunder, for all purposes within the Field to practice and use the Patents
and Technical Information, including the rights to manufacture and have
manufactured, to use and have used, and to sell and have sold Products. Medisorb
exclusively retains all rights under the Patents and Technical Information
outside the Field and for use other than in Products. The right to grant
sublicenses granted hereunder is exclusive to Janssen and shall not extend to
Janssen Affiliates or Sublicensees.

              (b) Medisorb shall offer to Janssen for incorporation into this
License Agreement on reasonable terms and conditions, Medisorb Improvements in
the Field which, if incorporated into Janssen's then current commercial
Product(s),  would: (i) result in significant changes in either the
specifications for such Product(s) or the processes for producing such
Product(s), and (ii) would reasonably be expected to result in enhanced market
value and/or profitability of such Product(s).  Examples of such Improvements
would include: (i) the development by Medisorb of a non-aqueous injection
vehicle which offers significant advantages with respect to ease of
administration and (ii) the development by Medisorb of technology enabling[
                                              ].  It is the parties'
understanding that the effect of any such license amendment would, in general,
be either an extension of the term of this Agreement for a mutually agreed
period  or a marginal increase in the then current royalty rate .  All other
Medisorb Improvements shall be made available to Janssen for its use without
further agreement.  Proprietary rights to Improvements jointly developed by
Medisorb and Janssen shall be governed by the terms of Section 5(c) of this
Agreement.

              (c) In the event that at any time during the term of this
Agreement Medisorb is unable for any reason whatsoever to supply the Medisorb
Polymers required by Janssen for use in Products, then the license granted under
paragraph 2(a) above shall be expanded to include the Medisorb Technology
required to make and use the Medisorb Polymers.

          (3) Royalties:
              ----------

              (a) Janssen shall pay or cause to be paid to Medisorb a running
royalty with respect to all Products sold to customers by Janssen, its
Affiliates and Sublicensees, payable quarter-annually in arrears within sixty
(60) days following the end of each three (3) month period ending on March 31,
June 30, September 30 or December 31 in any year during the term hereof, as
follows:  (i) [    ]% of the Net Sales of each unit of Product sold during the
preceding calendar quarter during the term hereof, if such unit of Product was
manufactured by Medisorb pursuant to a written contract for the supply of
Product; or (ii) [    ]% of the Net Sales of each unit of Product sold during
the preceding calendar quarter during the term hereof, if such unit of Product
was not manufactured by Medisorb pursuant to a written contract for the supply
of Product.  Any withholding or other tax that Janssen or any of its Affiliates
are required by statute to withhold and pay on behalf of Medisorb with respect
to the royalties payable to Medisorb under this Agreement shall be deducted from
said royalties and paid contemporaneously with the remittance to Medisorb;
provided, however, that in regard to any tax so deducted Janssen shall furnish
Medisorb with proper evidence of the taxes paid on its behalf.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                          Page 4
License Agreement

              (b) In the event that, in a country where Product is not claimed
in a valid Patent, a similar product obtains a market share greater than [ ]% of
the total market revenues for Products and similar products in such country, the
parties agree to meet and negotiate in good faith an appropriate reduction in
the royalty rate then in effect. In no event shall a reduction in royalty rates
pursuant to this section result in royalty rates [ ] of the rates specified
under Section 3(a)(i) and 3(a)(ii) of this Agreement. For the purposes of this
section, "similar product" shall mean a generic version of the Product(s) where:
(i) the active agent is [ ], or a chemical analogue thereof and (ii) the
excipient is comprised of lactic and/or glycolic acids. In the event that patent
protection for Product(s) becomes available subsequent to a royalty reduction
pursuant to this section, the parties agree to (i) reinstitute the royalty
otherwise applicable, and (ii) in the event that any recovery is obtained for
prior infringement of the subsequently issued patent, the parties will first
apply such recoveries to reimbursing Medisorb for royalties it would otherwise
have received.

              (c) Janssen shall keep complete and adequate records with respect
to the proceeds of Products on which it has to pay royalties payable hereunder
for at least two (2) years after expiry of the year they concern. Medisorb shall
have the right to have such records of Janssen inspected and examined, at
Medisorb's expense, for the purpose of determining the correctness of royalty
payments made hereunder.

Such inspection shall be made by an independent, certified public accountant to
whom Janssen shall have no reasonable objection.  Such accountant shall not
disclose to Medisorb any information other than that necessary to verify the
accuracy of the reports and payments made pursuant to this Agreement.  It is
understood that such examination with respect to any quarterly accounting period
shall take place not later than two (2) years following the expiration of said
period.  Not more than one examination per year shall take place.

Based upon the verification of such reports and whenever there is reasonable
doubt about the accuracy of the sales of Product realized by an Affiliate or
sublicensee, Medisorb may reasonably request Janssen to audit the books of such
Affiliate or such sublicensee in accordance with any applicable contractual
provision, in order to confirm the accuracy of such reports.

          (4) Production of Product/Technology Transfer:
              ----------------------------------------- 

              (a) Janssen shall use its reasonable efforts to commercialize and
market Product, or to have the same commercialized and marketed.

              (b) In the event that Janssen determines to manufacture Product
itself or have Product manufactured by a third party, Medisorb shall transfer to
Janssen all relevant Technical Information, and provide such technical
assistance, upon mutually agreed terms and conditions, as is required by Janssen
in order to enable the manufacture of Product by Janssen or its designated third
party manufacturer. However, with respect to such third party manufacturers,
except as limited by a written Product manufacturing agreement between Janssen
and Medisorb, Medisorb will have a right of first refusal as to the manufacture
and supply to Janssen of all Product(s), and component bioabsorbable polymers
utilized in such Product(s). Medisorb will have a period of thirty (30) days

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                          Page 5
License Agreement

following written notice from Janssen of terms it is offering to, or prepared to
accept from, a third party manufacturer to notify Janssen of its intention to
exercise its right of first refusal to supply Product and/or component
bioabsorbable polymers thereof to Janssen, its Affiliates and Licensees on terms
no less favorable to Janssen than those offered by such third party
manufacturer.  Such third party manufacturer cannot be an in-kind competitor to
Medisorb and must be reasonably acceptable to Medisorb with respect to
confidential protection of Medisorb's Technical Information.  In the event that
at any time during the term of this Agreement Medisorb is unable for any reason
whatsoever to supply the Medisorb Polymers required by Janssen for use in
Products, then the right of first refusal under this paragraph  respecting the
supply of the component bioabsorbable polymers shall be eliminated.  For the
purposes of this section, an "in-kind" competitor shall mean any organization
which regularly engages in the contract development and/or contract manufacture
of injectable controlled release drug delivery systems comprising a polymeric
excipient based on lactic and/or glycolic acids and/or other closely related
monomers.  This Section 4(b) specifically supercedes Section 7(B) of the
Development Agreement, which Section 7(B) shall be of no further force or
effect.

              (c) The right of first refusal granted to Medisorb pursuant to
Section 4(b) above shall be contingent upon: (i) Medisorb and Janssen reaching
an agreement concerning the financing, scheduling and construction in Europe of
a Medisorb manufacturing facility within twelve (12) months of the date first
above written or the initiation of Phase III human clinical trials, whichever is
later, and (ii) prior to the qualification of Medisorb's European manufacturing
facility, Medisorb using reasonable efforts to supply from its United States
manufacturing facilities all of Janssen's commercial requirements for Product
pursuant to the Product Supply Agreement anticipated by Section 7(A) of the
Development Agreement.

          (5)  Proprietary Rights
               ------------------

              (a) Medisorb will retain title to and ownership of all technology
(including, without limitation, all patents, inventions, and data relating
thereto) relating to absorbable polymers, controlled release of active agents,
and/or manufacturing methods or processes relating to such polymers and the
controlled delivery systems for active agents based on such polymers previously
owned by Medisorb or developed by Medisorb as a result of the Development
Program or otherwise. Medisorb will pay its own costs and expenses in connection
with the protection of any such technology, including all patent application and
maintenance costs and Janssen agrees to provide Medisorb with any necessary
utility information.

          Medisorb shall inform Janssen of any patent application it wishes to
file to protect proprietary rights defined in Article 5, resulting from either
the Development Program or the preliminary Development Program and shall forward
a copy of any such patent application to Janssen at least one month prior to
filing.

          Medisorb shall consider any suggestions made by Janssen for amplifying
such application and shall accordingly amend the application where in Medisorb's
opinion it is appropriate.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                          Page 6
License Agreement

          Nine months after the first filing, Medisorb shall propose a list of
countries in which it intends to file foreign equivalents. Janssen shall be
given the opportunity to propose further countries to be added to the list. In
case the adding of some or all of these further countries is unacceptable  to
Medisorb, Janssen shall have the right to file patent applications in those
countries, in Medisorb's name and at Janssen expense. Medisorb shall assist in
the transfer of rights for the latter patent applications and shall provide all
information necessary to file and prosecute such patent applications.

          Medisorb shall not abandon part or whole of any of the patents or
patent applications without having first consulted Janssen, which shall have the
right to further pursue any patents or patent applications which Medisorb wishes
to abandon, or parts thereof, in its own name and at its own expense.

              (b) Janssen and/or its Affiliate will retain title to and
ownership of all technology (including, without limitation, all patents,
inventions, and data relating thereto) relating to [ ] or any chemical analogues
of [ ] with similar physiological activity previously owned by Janssen and/or
its Affiliate or developed by Janssen as a result of this Agreement or
otherwise. Janssen and/or its Affiliate will pay its own costs and expenses in
connection with the protection of any such technology, including all patent
application and maintenance costs and Medisorb agrees to provide Janssen with
any necessary utility information.

              (c) Any inventions, other than those falling under either section
5(a) or 5(b) hereof, having an inventorship jointly between at least one
employee of Janssen or an Affiliate of Janssen and one employee of Medisorb or
an Affiliate of Medisorb shall be jointly-owned by Janssen and Medisorb. Each
party will cooperate fully in the filing and prosecution of such patent
applications.

          Janssen and Medisorb shall agree on which of both shall be responsible
for the filing, prosecution and maintenance of any such joint patent
applications and patents (hereinafter referred to as the "Responsible Party").
In principle, the party having contributed the most to the invention to be
protected shall be the responsible party, unless agreed upon differently. Upon
mutual consent, the responsible party may select an agent for drafting, filing
and prosecuting a joint application. However, both parties shall agree who shall
be the agent and to what extent this agent shall be used.

          The Responsible Party shall consult the other party when drafting any
new jointly owned patent application. The final draft shall be forwarded to the
other party at least one month prior to filing to give the opportunity to make
final comments.

          The Responsible Party shall propose a list of countries in which it
intends to file such patent applications. The other party shall be given the
opportunity to propose further countries to be added to the list. In case the
adding of some or all of these further countries is unacceptable to the
Responsible Party, the other party shall have the right to file patent
applications in those countries, in its own name and at its own expense. The
Responsible Party shall assist in the transfer of rights for the latter patent
applications and shall provide all information necessary to file and prosecute
such patent applications.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                          Page 7
License Agreement

          The Responsible Party shall not abandon part or whole of any of the
patents or patent applications without having first consulted the other party,
which shall have the right to further pursue any patents or patent applications
which the responsible party wishes to abandon, or parts thereof, in its own name
and at its own expense.

          All out-of-pocket costs made in relation to joint patent applications
and patents shall be shared equally by Janssen and Medisorb. A statement of
costs shall be made up on a quarterly basis and invoiced to the other party.

          Medisorb shall grant to Janssen an exclusive fully-paid up royalty
free license with the right to sublicense to make, have made, use and sell under
any such patents or patent applications for the duration of the patents, any
continuations, continuations in part, divisions, patents of addition, reissues,
renewals or extensions thereof or any supplementary protection  certificates
granted with respect thereto, in respect of any claims concerning the
application of [                   ] or any chemical analogues of [
] with similar physiological activity. However, nothing contained in this
paragraph shall obviate Janssen's obligation to pay royalties under Section 3
hereof with respect to any Products developed hereunder.

          Janssen shall grant to Medisorb an exclusive fully paid-up royalty
free license with the right to sublicense to make, have made, use and sell under
any such patents or patent applications for the duration of the patents, any
continuations, continuations in part, divisions, patents of addition, reissues,
renewals or extensions thereof or any supplementary protection certificates
granted with respect thereto, in respect of any claims concerning the
application of bioabsorbable polymers in the field of human and/or veterinary
medicine.

              (d) In addition, each party will retain exclusive title to its
respective confidential information in accordance with the provisions of Article
9 below.

          (6)  Patent Infringement
               -------------------

              (a) In the event that either party becomes aware that any third
party is infringing any patents included within the Patents in any country or
countries, the party becoming aware of such infringement shall promptly give
notice of such infringement to the other party. Any possible action against such
alleged infringement of the Patents will be carried out by either or both of the
parties in accordance with the provisions specified hereinafter in paragraphs
(b), (c), (d) and (e).

              (b) Whenever it would concern a patent or patent application
falling within the definition of Patents and of which Medisorb retains full
title and ownership pursuant to Article 5 a), Medisorb shall use all reasonable
efforts to take action against such infringement in its own name, at its own
expense and on its own behalf.

          If Medisorb fails to take action against such infringement, or if
Medisorb does not use reasonable efforts in carrying out such action after
commencement thereof, within thirty (30) days after the notice referred to in
paragraph (a) above or after having become aware of such infringement, Janssen
shall be entitled at its own discretion and at its own expense, to take
immediate action against

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                          Page 8
License Agreement

such infringement in its own name, at its own expense and on its own behalf. If
Janssen commences or assumes such action, Janssen may credit [
] of any royalty otherwise due to Medisorb for sales in such country or
countries against the amount of the expenses and costs of such action, including
without limitation, attorney fees actually incurred by Janssen.  The amount of
expenses so deducted shall be paid to Medisorb out of the recoveries, if any,
received by Janssen as a result of such action.  Except for such repayment of
royalties deducted, Janssen shall be entitled to retain all recoveries
therefrom.

          In no event shall Medisorb settle with such infringing third party in
the Field without the prior written consent of Janssen.

              (c) Whenever it would concern a patent or patent application
falling within the definition of Patents and of which Janssen retains full title
and ownership pursuant to Article 5 B), Janssen shall have the right but not the
obligation to take action against such infringement in its own name, at its own
cost and on its own behalf. If Janssen fails to take action against such
infringement, or if Janssen does not use reasonable efforts in carrying out such
action after commencement thereof, within thirty (30) days after the notice
referred to in paragraph (a) above or after having become aware of such
infringement, Medisorb shall be entitled at its own discretion and at its own
expense, to take action against such infringement. Medisorb shall be entitled to
retain all recoveries, if any, therefrom.

              (d) Whenever it would concern a patent or patent application
falling within the definition of Patents and of which Janssen and Medisorb
jointly retain full title and ownership pursuant to Article 5 (c), and whenever
in such case the infringing product would be a drug product falling within the
definition of the Field, Janssen shall have the right but not the obligation to
take action against such infringement in its own name, at its own cost and on
its own behalf. If Janssen fails to take action against such infringement, or if
Janssen does not use reasonable efforts in carrying out such action after
commencement thereof, within thirty (30) days after the notice referred to in
paragraph (a) above or after having become aware of such infringement, Medisorb
shall be entitled at its own discretion and at its own expense, to take action
against such infringement, it being understood that Janssen will have a
continuing right to take over any such action at its own expense and shall pay
to Medisorb from any recoveries Janssen receives (i) Medisorb's expenses and
(ii) from any sums remaining after deduction of Medisorb's and Janssen's
expenses, an amount proportionate to Medisorb's expenses in relation to
Janssen's expenses.

          Whenever it would concern a patent or patent application falling
within the definition of Patents and of which Janssen and Medisorb jointly
retain full title and ownership pursuant to Article 5 (c), and whenever in such
case the infringing product would be a drug product falling outside the
definition of the Field, Medisorb shall have the right but not the obligation to
take action against such infringement in its own name, at its own cost and on
its own behalf.  If Medisorb fails to take action against such infringement, or
if Medisorb does not use reasonable efforts in carrying out such action after
commencement thereof, within thirty (30) days after the notice referred to in
paragraph (a) above or after having become aware of such infringement, Janssen
shall be entitled at its own discretion and at its own expense, to take action
against such infringement, it being understood that Medisorb will have a
continuing right to take over any such action at its own

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                          Page 9
License Agreement

expense.  If Janssen commences or assumes such action, Janssen may credit [
] of any royalty otherwise payable to Medisorb payable hereunder against the
amount of the expenses and costs of such action, including without limitation,
attorney fees actually incurred by Janssen.  The amount of expenses so deducted
shall be paid to Medisorb out of the recoveries, if any, received by Janssen as
a result of such action.  Except for such repayment of royalties deducted,
Janssen shall be entitled to retain all recoveries therefrom.

              (e) Each party agrees to cooperate reasonably with the other party
in such litigation, including making available to the other party records,
information, and evidence relevant to the infringement of the Patent.

          (7) Third Party Intellectual Property Rights
              ----------------------------------------

              (a) Medisorb warrants that to the best of its current knowledge
and belief the Products to be developed hereunder will not infringe the patent
rights of any third party.

              (b) In the event that the manufacture, use or sale of the Product
would constitute an infringement of the rights of a third party in a country
because of the use of the Patents or Medisorb's know how, each party shall, as
soon as it becomes aware of the same, notify the other thereof in writing,
giving in the same notice full details known to it of the rights of such third
party and the extent of any alleged infringement.  The parties shall after
receipt of such notice meet to discuss the situation, and, to the extent
necessary attempt to agree on a course of action in order to permit Janssen to
practice the license granted hereunder.  Such course of action may include:  (a)
modifying the Product or its manufacture so as to be noninfringing; (b)
obtaining an appropriate license from such third party; or (c) fight the claimor
suit.  In the event that within a short period of time, the parties fail to
agree on an appropriate course of action Janssen may decide upon the course of
action in the interest of the further development, manufacturing or
commercialization of the Product.

              (c) In the event that the parties cannot agree on modifying the
Product or in the case that such modification would not be economically viable
or regulatorily feasible, Janssen, whenever it relates to know how, whether
patented or not, owned by Janssen in accordance with the provisions of Article 5
(b) and (c), or Medisorb, whenever it relates to know how, whether patented or
not, owned by Medisorb in accordance with the provisions of Article 5 (a), will
have the right to negotiate with such third party for such license.  Both
parties hereto will in any event in good faith consult with each other with
respect to such negotiations and the party negotiating such license as indicated
above, will make every effort to minimize the amount of license fees and
royalties payable thereunder.  In no event shall either party as a result of
such settlement, grant a sublicense or cross license to the third party to
settle the suit, without the prior written approval of the other party.  In the
event that such negotiations result in a consummated agreement, any license fee
and/or royalties to be paid thereunder shall be paid by the party responsible
for the negotiations as indicated above, [                   ] of any license
fees or royalties paid by Janssen under such license will be creditable against
royalties due to Medisorb with respect to such country or countries.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                         Page 10
License Agreement

              (d) In the event that either or both parties would further to such
notification under Paragraph 7 (b) decide to defend such suit or claim in which
a third party alleges that the manufacture, use or selling of the Product
infringes said third party's patent in a country, Janssen shall have the right
to apply [                           ] of the royalties due to Medisorb on the
sales of the allegedly infringing Product against its litigation expenses.

          (8)  Term:
               ---- 

              (a) Except as otherwise provided herein, this Agreement and the
term of the license granted to Janssen hereunder shall commence on the date
first written above and shall expire (i) upon expiration of the last to expire
Patent in such country or (ii) fifteen (15) years after the date of the first
commercial sale of Product in such country, whichever is later; provided, that
in no event shall the license granted hereunder expire later than the twentieth
anniversary of the first commercial sale of Product in any country with the
exception of the following countries where the fifteen (15) year minimum shall
pertain regardless: Canada, France, Germany, Italy, Japan, Spain and the United
Kingdom. After expiration of the license granted to Janssen hereunder, Janssen
shall retain a fully paid-up non-exclusive license to manufacture, use and sell
Products in the Field in the Territory.

              (b) Medisorb may convert the exclusive license granted under this
Agreement to non-exclusive if Janssen does not maintain the following minimum
annual royalty payments to Medisorb:

                  (i) With respect to the entire Territory, excluding Japan, the
minimum royalty obligation will first apply to the twelve month period following
the anniversary of the end of the ;month in which the Product was launched in
the third major country. For the purpose of this Article only, major country
shall mean France, Germany, United Kingdom or Italy. During the first twelve
month period that such minimum royalty obligation is applicable, the minimum
royalty amount to be paid by Janssen will be calculated by multiplying the
applicable royalty rate by [ ] percent of the actual aggregate net sales of
other [ ] products during such twelve month period in the three major countries
referred to above.

As from the subsequent twelve month period the minimum annual royalty amount to
be paid by Janssen will be calculated by multiplying the applicable royalty rate
by [  ]% of the aggregate net sales of other [                   ] products
during such period in all countries where Product has been launched and marketed
for a period of minimally twelve months prior to the actual reference twelve
month period; and

                  (ii) In Japan the minimum royalty obligation will be first
applied to the twelve month period following the anniversary of the end of the
month in which the Product was launched. The minimum annual royalty amount to be
paid by Janssen will be calculated by multiplying the applicable royalty rate by
an amount representing [ ]% of the aggregate net sales of other [ ] products in
Japan during such period.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                         Page 11
License Agreement

Janssen shall have the right to make up any shortfall in minimum royalty
payments from Product sales, both in Japan and in the rest of the Territory
provided, such  make-up payment is made at the same time and in the same manner
as required for the underlying minimum royalty obligation.

Janssen may elect to have its exclusive rights converted into non-exclusive
rights on a country by country basis.  As a consequence thereof, such country's
other [                   ] products sales will no longer be taken into account
for calculating the above minimum royalty obligation.

              (c) In the event that either party shall enter or be put into
voluntary or compulsory liquidation or have a receiver appointed or default in
the observance or performance of its obligations under this Agreement and shall
fail to remedy such default within ninety (90) days after the delivery of
written notice from the other party, the other party shall be entitled upon
giving written notice to terminate this Agreement.

              (d) Janssen may terminate this Agreement without cause upon 30
days prior written notice. Thereafter, Janssen shall have no further rights or
privileges with respect to the use of Medisorb Technology in Products and
Medisorb shall be under no further obligation of non-competition or exclusive
dealing.

              (e) Any early termination of the Agreement shall be without
prejudice to the rights of either party against the other accrued under this
Agreement prior to termination.

              (f) Upon any termination of this Agreement, any remaining
inventory of Product may be sold, provided all royalties otherwise due hereunder
are paid with respect to such sales.

          (9)  Confidentiality:
               --------------- 

              (a) Each party agrees to keep confidential and to not use for any
purpose other than as set forth herein all technical information and materials
supplied by the other hereunder and any information a party may acquire about
the other or its activities as a result of entering into this Agreement,
provided that such obligation shall not apply to technical information or
material which:  (i) was in the receiving party's possession without restriction
prior to receipt from the other party or its Affiliates; (ii) was in the public
domain at the time of receipt; (iii) becomes part of the public domain through
no fault of the receiving party; (iv) shall be lawfully received from a third
party with a right of further disclosure; (v) shall be required to be disclosed
by law, by regulation or by the rules of any securities exchange.

              (b) Except as may be otherwise provided herein, the
confidentiality obligations as set out in this Section shall continue so long as
this Agreement remains in force and thereafter for a period of seven (7) years.

              (c) Janssen shall cause its Affiliates and Sublicensees to abide
by the obligations of confidentiality with respect to unpublished information
within the Patents and Technical Information.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                         Page 12
License Agreement

              (d) Any confidential information relating to the subject matter of
this Agreement imparted to the other party prior to the execution of this
Agreement shall be considered to fall under the terms of this Agreement.

          (10) Disclaimer of Warranty: Medisorb makes no representations or
               ----------------------                                      
warranties, express or implied, with respect to the Medisorb Patents and
Technical Information licensed to Janssen hereunder, including without
limitation any warranties of merchantability or fitness for a particular
purpose.

          (11) Liability
               ---------

              (a) Janssen agrees to indemnify, defend and hold harmless Medisorb
from and against any liability, loss, damages and expenses (including reasonable
attorney fees) Medisorb may suffer as the result of claims, demands, costs or
judgments which may be made or instituted against Medisorb by reason of personal
injury or damage to property arising out or caused by Janssen's promotion, use
and sale of the Product, except where such liabilities claims, demands, costs or
judgments are caused by Medisorb's  failure to provide Janssen with any
information as specified in Section 12 (c) and Article 13.  Medisorb will notify
Janssen as soon as it becomes aware of any such claim or action and agrees to
give reasonable assistance in the investigation and defense of such claim or
action it being understood that it shall allow Janssen to control the
disposition of the same.

              (b) Medisorb agrees to indemnify, defend and hold harmless Janssen
from and against any liability, loss, damages and expenses (including reasonable
attorney fees) Janssen may suffer as the result of claims, demands, costs or
judgments which may be made or instituted against Janssen by reason of personal
injury or damage to property arising out or caused by Medisorb's  failure to
provide Janssen with any information as specified in Section 12 (c) and Article
13.

              (c) In no event shall either party be liable for loss of profits,
loss of goodwill or any consequential or incidental damages of any kind of the
other party.

          (12) Product Information and Adverse Drug Events
               -------------------------------------------

              (a) As Janssen has superior knowledge of the end-use applications
to which Products licensed hereunder will be put, Janssen is responsible for
providing third parties with adequate information as to the medical profile of
such Products. Janssen will provide Medisorb with copies of the IPID
(International Product Information Document) and the IPPI (International Patient
Package Insert), which are all part of the IRF for the Product. For the purpose
of this Agreement IPID refers to the document that summarizes all medically
relevant features of the Product, including the instructions for use meant to
inform the medical profession, whereas the IPPI is a patient-oriented document,
based upon the IPID that summarizes all relevant information on the Product in
lay language. Janssen will keep Medisorb informed of any revisions or amendments
in the IPID and IPPI of the Product.

              (b) Medisorb does not claim the expertise to judge whether
Product(s) will perform acceptably in Janssen's application(s). Janssen is the
sole judge as to whether Product(s) will

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                         Page 13
License Agreement

perform acceptably in Janssen's application(s).  Janssen represents and warrants
on an on-going basis during the term of this agreement that it has the
capability to assess the suitability of Product(s) in Janssen's application(s)
and agrees to conduct adequate testing to confirm the safety and efficacy of
Products prior to commercialization.

              (c) Medisorb will provide to Janssen promptly after its discovery
by Medisorb, any information in its possession which indicates adverse effects
in humans associated with the Products, including the bioabsorbable polymeric
components thereof, licensed hereunder. For the purpose of this Agreement
"adverse event" shall mean an experience which is noxious and unintended and
which occurs at doses normally used in man for the prophylaxis, diagnosis or
therapy of a disease or for the modification of a physiological function and any
report of an overdose.

          (13) Government Approvals
               --------------------

          Janssen shall be responsible for conducting all necessary testing as
well as determining what, if any, government approvals are required for the use
and sale of Product licensed hereunder and shall comply with all such
requirements prior to and following the sale or distribution of such Products.

          Medisorb shall cooperate fully with Janssen in obtaining regulatory
approvals for Product licensed hereunder and shall, at Janssen's request,
provide appropriate regulatory authorities with any and all information
concerning Medisorb's technology, Medisorb polymers and Medisorb's manufacturing
process for such Product.

          In this respect Medisorb undertakes that it has submitted or will as
soon as possible submit a type IV Drug Master File to the FDA identifying
Medisorb's method of manufacture, release specifications and testing methods
used in the manufacture of its bioabsorbable polymers and a type I Drug Master
File of Medisorb's manufacturing facilities where Product may be manufactured.
Medisorb will authorize Janssen at its request to cross-reference any Medisorb
Drug Master Files relating to the Medisorb Polymers.

          (14) Force Majeure:  Neither party shall be liable for its failure to
               -------------                                                   
perform any of its obligations hereunder if such failure is occasioned by a
contingency beyond its reasonable control including, but not limited to,
occurrences such as strikes or other labor disturbances, lock out, riot, war,
default by a common carrier, fire, flood, storm, earthquake, other acts of God,
inability to obtain raw materials, failure of plant facilities or government
regulation, act or failure to act. Each party shall notify the other immediately
upon occurrence or cessation of any such contingencies. If such contingency
continues unabated for at least 180 consecutive days, either party shall have
the right to terminate this Agreement without further obligation beyond those
actually incurred prior to such termination.

          (15) Press Communications:  Neither party shall originate any
               --------------------                                    
publicity, news release or public announcement, written or oral relating to this
Agreement, including its existence, without the prior written approval of the
other party.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                        Page 14
License Agreement

          (16) Notices:  Any legal notice required or permitted hereunder shall
               -------                                                         
be considered properly given if in writing and sent by first class mail,
certified mail or by telefacsimile to the party being notified at the respective
address of such party as follows:

          If to Medisorb:

               Medisorb Technologies International L.P.
               6954 Cornell Road
               Cincinnati, OH 45242
               USA
               Facsimile: 513-489-2348

          If to Janssen:

               Janssen Pharmaceutica
               Kollerstrasse 38
               6300  Zug 6
               Switzerland
               Facsimile: 00-41-42449565

Such notice shall be effective upon receipt or upon refusal to accept such
notice. In any case, notice shall be presumed effective no later than five (5)
days after such notice is sent.

          Neither party shall originate any publicity, news release or public
announcement, written or oral, relating to this Agreement, including its
existence, without the written approval of the other party.

          (17) Assignment:  This Agreement shall not be assigned by either party
               ----------                                                       
without the prior written consent of the other party; provided, however, that
assignment shall be permitted without such consent to any party, not less than
50% of the total interest of which owns, is owned by, or is under common control
with the assigning party. In the event of any such permitted assignment the
assignee shall be subject to and shall agree in writing to be bound by the terms
and conditions of this Agreement.

          (18) Dispute Resolution:  The parties shall amicably discuss and
               ------------------                                         
negotiate any matters which arise under this Agreement and are not specifically
set forth hereunder.  If any disputes arise under this Agreement, the parties
shall use their best efforts to meet and resolve such disputes.  In the event
that the parties are unable to resolve any such disputes, then both parties
hereby agree to submit said disputes to the jurisdiction of the competent Courts
of Zurich, Switzerland, and agree that any litigation in any way related to this
Agreement shall be submitted to such Courts and that same shall be subject to
Swiss law.

          (19) Severability:  In the event any one or more of the provisions of
               ------------                                                    
this Agreement should for any reason be held by any court or authority having
jurisdiction over this Agreement or any of the parties hereto to be invalid,
illegal or unenforceable such provision or

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                         Page 15
License Agreement

provisions shall be validly reformed to as nearly approximate the intent of the
parties as possible and, if unreformable; shall be divisible and deleted in such
jurisdiction, elsewhere this Agreement shall not be affected.

          (20) Captions:  The captions of this Agreement are for convenience
               --------                                                     
only, and shall not be deemed of any force or effect whatsoever in construing
this Agreement.

          (21) Waiver:  The failure on the party of a party to exercise or
               ------                                                     
enforce any right conferred upon it hereunder shall not be deemed to be a waiver
of any such right, nor operate to bar the exercise or enforcement thereof at any
time thereafter.

          (22) Survival:  The following Articles of this Agreement shall survive
               --------                                                         
the termination or expiration of this Agreement:  5, 9, 10, 11, 15, 17,  and 18.

          (23) Miscellaneous:  This Agreement may be executed by the parties
               -------------                                                
hereto in counterparts, each of which when so executed and delivered shall be
considered to be an original, but all such counterparts shall together
constitute but one and the same instrument.  This Agreement is the complete
agreement of the parties and supersedes all previous understandings and
agreements relating to the subject matter hereof.  Neither this Agreement nor
any of the terms hereof may be terminated, amended, supplemented, waived or
modified orally , but only by an instrument in writing signed by the party
against whom enforcement of the termination, amendment, supplement, waiver or
modification is sought.

          IN WITNESS WHEREOF, the duly authorized representatives of the parties
hereto have executed this Agreement as of the day and year first above written.


JANSSEN PHARMACEUTICA INTERNATIONAL
  A division of Cilag International AG


By: _________________________
Name: _______________________
Title: ______________________
Date: _______________________


{Second Janssen Signatory}
--------------------------


By: _________________________
Name: _______________________
Title: ______________________
Date: _______________________

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen-Medisorb                                                         Page 16
License Agreements

MEDISORB TECHNOLOGIES INTERNATIONAL  L.P.


by:  Medisorb Technologies
     International, Inc.,
     its General Partner


By: __________________________
Name:  David R. Lohr
      ------------------------
Title: President
       -----------------------
Date: ________________________

12059504.doc
12/05/95 4:06 PM
 
     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
                                   EXHIBIT C


                            To Development Agreement
                            dated December 23, 1993
                                    between
                      Janssen Pharmaceutica International
                                      and
                   Medisorb Technologies International L.P.:


                  License Agreement, United States of America
                               Following 16 Pages



/s/ Paul F. Costa  12/12/95
-----------------  --------
For JANSSEN        Date


/s/ David R. Lohr  December 6, 1995
------------------ ----------------
For MEDISORB       Date

12059503.doc

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
                               LICENSE AGREEMENT

          This Agreement is made as of the __ day ______ of 19___, between
MEDISORB TECHNOLOGIES INTERNATIONAL L.P., a Delaware limited partnership
(hereinafter "Medisorb") and JANSSEN PHARMACEUTICA INC., a New Jersey
corporation ("Janssen US").

          WHEREAS,  Medisorb and Janssen Pharmaceutica International, an
affiliate of Janssen US, have entered into a certain Development Agreement,
dated December 23, 1993 (the "Development Agreement"), for the development of a
Product (as described below); and

          WHEREAS, Janssen Pharmaceutica International has an option under the
Development Agreement to enter into this License Agreement for the Medisorb
technology required to make, use and sell the Product, which option Janssen
Pharmaceutica International has assigned to Janssen US with the consent of
Medisorb and which option Janssen US has elected to exercise; and

          WHEREAS, the parties believe that it is in their mutual best interest
for Medisorb to license to Janssen US on an exclusive basis in the Territory,
Medisorb Patents and Technical Information within the Field, upon the terms and
conditions set forth herein;

          NOW, IT IS HEREBY AGREED AS FOLLOWS:

          (1) Definitions:  The following terms shall have the meanings ascribed
              -----------                                                       
to them herein, unless the context otherwise requires:

              (a) "Affiliate" shall mean any company controlling, controlled by,
or under common control with a party by ownership, directly or indirectly, of
fifty percent (50%) or more of the total ownership or by the power to control
the policies and actions of such company.

              (b) "Development Program" shall mean the development activities
conducted by the parties pursuant to the Development Agreement.

              (c) "Field" shall mean the treatment of [



                                                            ].

              (d) "Improvements" shall mean any improvements or developments to
or of the Patents and Technical Information in the Field which Medisorb may
acquire, discover, invent, originate, make, conceive or have a right to, in
whole or in part, during the term of this Agreement, whether or not such
improvement or development is patentable.

              (e) "Medisorb Polymers" shall mean bioresorbable aliphatic
polyesters based on glycolide, lactide, caprolactone and combinations of such
polymers, which are manufactured by Medisorb and utilized in Product(s) licensed
under this Agreement.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                       Page 2
License Agreement

              (f) "NDA" shall mean a New Drug Application and all supplements
filed pursuant to the requirements of the United States Food and Drug
Administration, including all documents, data and other information concerning
Product which are necessary for, or included in, FDA approval to market a
Product as more fully defined in 21 C.F.R. 314.5 et seq. or any other similar
application for marketing authorization filed with the appropriate regulatory
authorities in other countries of the Territory (as defined hereinafter).

              (g) "Net Sales" shall mean the gross amounts received from sales
of Products during a calendar quarter to third parties by Janssen US, its
Sublicensees or any Affiliate of either, less any: (i) applicable sales taxes;
(ii) cash trade or quantity discounts; (iii) amounts repaid or credited by
reason of rejections or return of goods; or (iv) freight, postage and duties
paid for. No deduction from the gross sales price shall be made for any item of
cost incurred by the seller in its own operations incident to the manufacture,
sale or shipment of the product sold. For purposes hereof, Net Sales shall not
include sales of a Product from Janssen US or an Affiliate of Janssen US to any
Affiliate or Sublicensee of either; it being intended that Net Sales shall only
include sales to unrelated third-parties.

              (h) "Patents" shall mean (i) any and all existing issued patents
and patent applications or parts thereof which describe and claim a depot
formulation of [        ], or any chemical analogues of [         ] with similar
physiological activity, based on polymers of lactic and glycolic acids and the
production and use thereof; (ii) any other patents and patent applications filed
by or on behalf of Medisorb, or under which Medisorb has the rights to grant
licenses, which are needed to practice the inventions; and (iii) any reissues,
extensions, substitutions, confirmations, registrations, revalidations,
additions, continuations, continuations-in-part, or divisions of or to any of
the foregoing which are granted hereafter or any additional protection
certificate granted with respect thereto.

              (i) "Product(s)" shall mean any and all depot formulations of [   
     ], or any chemical analogues of [        ] with similar physiological
activity, based on polymers of lactic and glycolic acids which are designed to
deliver [       ], or any of its chemical analogues, over an extended period.

              (j) "Sublicensees" shall mean any company or companies, other than
Janssen US's Affiliates, sublicensed by Janssen US.

              (k) "Technical Information" shall mean all unpatented information,
know-how, practical experience, procedures, methodology, specifications,
formulae and data whether or not the same shall be patentable which have been
heretofore developed or acquired by Medisorb prior to the date of this Agreement
and which are necessary in order to use, manufacture or sell Products in the
Field.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                       Page 3
License Agreement

              (l) "Territory" shall mean the United States, its Territories,
Protectorates, Commonwealths, and all other political subdivisions of the United
States.

          (2)  License Grant
               -------------

              (a) Medisorb hereby grants to Janssen US in the Territory an
exclusive license under the Patents and Technical Information existing prior to
the effective date of this Agreement, with the right to grant sublicenses
thereunder, for all purposes within the Field to practice and use the Patents
and Technical Information, including the rights to manufacture and have
manufactured, to use and have used, and to sell and have sold Products. Medisorb
exclusively retains all rights under the Patents and Technical Information
outside the Field and for use other than in Products. The right to grant
sublicenses granted hereunder is exclusive to Janssen US and shall not extend to
Janssen US Affiliates or Sublicensees.

              (b) Medisorb shall offer to Janssen US for incorporation into this
License Agreement on reasonable terms and conditions, Medisorb Improvements in
the Field which, if incorporated into Janssen US's then current commercial
Product(s),  would: (i) result in significant changes in either the
specifications for such Product(s) or the processes for producing such
Product(s), and (ii) would reasonably be expected to result in enhanced market
value and/or profitability of such Product(s).  Examples of such Improvements
would include: (i) the development by Medisorb of a non-aqueous injection
vehicle which offers significant advantages with respect to ease of
administration and (ii) the development by Medisorb of technology enabling [
                                                   ].  It is the parties'
understanding that the effect of any such license amendment would, in general,
be either an extension of the term of this Agreement for a mutually agreed
period  or a marginal increase in the then current royalty rate .  All other
Medisorb Improvements shall be made available to Janssen US for its use without
further agreement.  Proprietary rights to Improvements jointly developed by
Medisorb and Janssen US or any of its Affiliates shall be governed by the terms
of Section 5(c) of this Agreement.

              (c) In the event that at any time during the term of this
Agreement Medisorb is unable for any reason whatsoever to supply the Medisorb
Polymers required by Janssen U.S. for use in Products, then the license granted
under paragraph 2(a) above shall be expanded to include the Medisorb Technology
required to make and use the Medisorb Polymers.

          (3)   Royalties:
                ----------

              (a) Janssen US shall pay or cause to be paid to Medisorb a running
royalty with respect to all Products sold to customers in the Territory by
Janssen

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                       Page 4
License Agreement

US, its Affiliates and Sublicensees, payable quarter-annually in arrears within
sixty (60) days following the end of Janssen US's regular fiscal quarters in any
year during the term hereof, as follows:  (i) [     ]% of the Net Sales of each
unit of Product sold during the preceding calendar quarter during the term
hereof, if such unit of Product was manufactured by Medisorb pursuant to a
written contract for the supply of Product; or (ii) [    ] % of the Net Sales of
each unit of Product sold during the preceding calendar quarter during the term
hereof, if such unit of Product was not manufactured by Medisorb pursuant to a
written contract for the supply of Product. Any withholding or other tax that
Janssen US or any of its Affiliates or Sublicensees are required by statute to
withhold and pay on behalf of Medisorb with respect to the royalties payable to
Medisorb under this Agreement shall be deducted from said royalties and paid
contemporaneously with the remittance to Medisorb; provided, however, that in
regard to any tax so deducted Janssen US shall furnish Medisorb with proper
evidence of the taxes paid on its behalf.

              (b) In the event that Product is not claimed in a valid Patent
effective in the Territory and a similar product obtains a market share greater
than [    ]% of the total market revenues for Products and similar products in
such country,  the parties agree to meet and negotiate in good faith an
appropriate reduction in the royalty rate then in effect.  In no event shall a
reduction in royalty rates pursuant to this section result in royalty rates [
] of the rates specified under  Section 3(a)(i) and 3(a)(ii) of this Agreement.
For the purposes of this section, "similar product" shall mean a generic version
of the Product(s) where: (i) the active agent is [                  ], or a
chemical analogue thereof and  (ii) the excipient is comprised of lactic and/or
glycolic acids.  In the event that patent protection in the Territory for
Product(s) becomes available subsequent to a royalty reduction pursuant to this
section, the parties agree to (i) reinstitute the royalty otherwise applicable,
and (ii) in the event that any recovery is obtained for prior infringement of
the subsequently issued patent, the parties will first apply such recoveries to
reimbursing Medisorb for royalties it would otherwise have received.

              (c) Janssen US shall keep complete and adequate records with
respect to the proceeds of Products on which it has to pay royalties payable
hereunder for at least two (2) years after expiry of the year they concern.
Medisorb shall have the right to have such records of Janssen US inspected and
examined, at Medisorb's expense, for the purpose of determining the correctness
of royalty payments made hereunder.

Such inspection shall be made by an independent, certified public accountant to
whom Janssen US shall have no reasonable objection.  Such accountant shall not
disclose to Medisorb any information other than that necessary to verify the
accuracy of the reports and payments made pursuant to this Agreement.  It is
understood that such examination with respect to any quarterly accounting period
shall take place not later than two (2) years following the expiration of said
period.  Not more than one examination per year shall take place.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen UA-Medisorb                                                       Page 5
License Agreement

Based upon the verification of such reports and whenever there is reasonable
doubt about the accuracy of the sales of Product realized by an Affiliate or
sublicensee, Medisorb may reasonably request Janssen US to audit the books of
such Affiliate or such sublicensee in accordance with any applicable contractual
provision, in order to confirm the accuracy of such reports.

          (4) Production of Product/Technology Transfer:
              ----------------------------------------- 

              (a) Janssen US shall use its reasonable efforts consistent with
its overall business practices and strategies to commercialize and market
Product, or to have the same commercialized and marketed in the Territory.

              (b) In the event that Janssen US determines to manufacture Product
itself or through an Affiliate or have Product manufactured by a third party,
Medisorb shall transfer to Janssen US and/or Affiliate all relevant Technical
Information, and provide such technical assistance, upon mutually agreed terms
and conditions, as is required by Janssen US in order to enable the manufacture
of Product by Janssen US, its Affiliate or its designated third party
manufacturer.  However, with respect to such third party manufacturers, except
as limited by a written Product manufacturing agreement between Janssen US and
Medisorb, Medisorb will have a right of first refusal as to the manufacture and
supply to Janssen US of all Product(s), and component bioabsorbable polymers
utilized in such Product(s). Medisorb will have a period of thirty (30) days
following written notice from Janssen US of terms it is offering to, or prepared
to accept from, a third party manufacturer to notify Janssen US of its intention
to exercise its right of first refusal to supply Product and/or component
bioabsorbable polymers thereof to Janssen US, its Affiliates and Licensees on
terms no less favorable to Janssen US than those offered by such third party
manufacturer. Such third party manufacturer cannot be an in-kind competitor to
Medisorb and must be reasonably acceptable to Medisorb with respect to
confidential protection of Medisorb's Technical Information.  In the event that
at any time during the term of this Agreement Medisorb is unable for any reason
whatsoever to supply the Medisorb Polymers required by Janssen U.S. for use in
Products, then the right of first refusal under this paragraph  respecting the
supply of the component bioabsorbable polymers shall be eliminated.  For the
purposes of this section, an "in-kind" competitor shall mean any organization
which regularly engages in the contract development and/or contract manufacture
of injectable controlled release drug delivery systems comprising a polymeric
excipient based on lactic and/or glycolic acids and/or other closely related
monomers.  This Section 4(b) specifically supersedes Section 7(B) of the
Development Agreement, which Section 7(B) shall be of no further force or
effect.

          (5)  Proprietary Rights
               ------------------

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                       Page 6
License Agreement

              (a) Medisorb will retain title to and ownership of all technology
(including, without limitation, all patents, inventions, and data relating
thereto) relating to absorbable polymers, controlled release of active agents,
and/or manufacturing methods or processes relating to such polymers and the
controlled delivery systems for active agents based on such polymers previously
owned by Medisorb or developed by Medisorb as a result of the Development
Program or otherwise. Medisorb will pay its own costs and expenses in connection
with the protection of any such technology, including all patent application and
maintenance costs and Janssen US agrees to provide Medisorb with any necessary
utility information.

          Medisorb shall inform Janssen US of any patent application it wishes
to file to protect proprietary rights defined in Article 5, resulting from
either the Development Program or the preliminary Development Program and shall
forward a copy of any such patent application to Janssen US at least one month
prior to filing.

          Medisorb shall consider any suggestions made by Janssen US for
amplifying such application and shall accordingly amend the application where in
Medisorb's opinion it is appropriate.

          Medisorb shall not abandon part or whole of any of the patents or
patent applications without having first consulted Janssen US, which shall have
the right to further pursue any patents or patent applications which Medisorb
wishes to abandon, or parts thereof, in its own name and at its own expense.

              (b) Janssen US and/or its Affiliate will retain title to and
ownership of all technology (including, without limitation, all patents,
inventions, and data relating thereto) relating to [        ] or any chemical
analogues of [        ] with similar physiological activity previously owned by
Janssen US and/or its Affiliate or developed by Janssen US and/or affiliate as a
result of this Agreement or otherwise. Janssen US and/or its Affiliate will pay
its own costs and expenses in connection with the protection of any such
technology, including all patent application and maintenance costs and Medisorb
agrees to provide Janssen US with any necessary utility information.

              (c) Any inventions, other than those falling under either section
5(a) or 5(b) hereof, having an inventorship jointly between at least one
employee of Janssen US or an Affiliate of Janssen US and one employee of
Medisorb or an Affiliate of Medisorb shall be jointly-owned by Janssen US or
Janssen US Affiliate as the case may be and Medisorb. Each party will cooperate
fully in the filing and prosecution of such patent applications.

          Janssen US and Medisorb shall agree on which of both shall be
responsible for the filing, prosecution and maintenance of any such joint patent
applications

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                       Page 7
License Agreement

and patents (hereinafter referred to as the "Responsible Party") in Territory.
In principle, the party having contributed the most to the invention to be
protected shall be the responsible party, unless agreed upon differently. Upon
mutual consent, the responsible party may select an agent for drafting, filing
and prosecuting a joint application. However, both parties shall agree who shall
be the agent and to what extent this agent shall be used.

          The Responsible Party shall consult the other party when drafting any
new jointly owned patent application. The final draft shall be forwarded to the
other party at least one month prior to filing to give the opportunity to make
final comments.

          The Responsible Party shall not abandon part or whole of any of the
patents or patent applications without having first consulted the other party,
which shall have the right to further pursue any patents or patent applications
which the responsible party wishes to abandon, or parts thereof, in its own name
and at its own expense.

          All out-of-pocket costs made in relation to joint patent applications
and patents in the Territory shall be shared equally by Janssen US and Medisorb.
A statement of costs shall be made up on a quarterly basis and invoiced to the
other party.

          Medisorb shall grant to Janssen US an exclusive fully-paid up royalty
free license with the right to sublicense to make, have made, use and sell under
any such patents or patent applications for the duration of the patents, any
continuations, continuations in part, divisions, patents of addition, reissues,
renewals or extensions thereof or any supplementary protection  certificates
granted with respect thereto, in respect of any claims concerning the
application of [                   ] or any chemical analogues of [
] with similar physiological activity. However, nothing contained in this
paragraph shall obviate Janssen US's obligation to pay royalties under Section 3
hereof with respect to any Products developed hereunder.

          Janssen US shall grant to Medisorb an exclusive fully paid-up royalty
free license with the right to sublicense to make, have made, use and sell under
any such patents or patent applications for the duration of the patents, any
continuations, continuations in part, divisions, patents of addition, reissues,
renewals or extensions thereof or any supplementary protection certificates
granted with respect thereto, in respect of any claims concerning the
application of bioabsorbable polymers in the field of human and/or veterinary
medicine.

              (d) In addition, each party will retain exclusive title to its
respective confidential information in accordance with the provisions of Article
9 below.

          (6)  Patent Infringement
               -------------------

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                       Page 8
License Agreement

              (a) In the event that either party becomes aware that any third
party is infringing in the Territory any patents included within the Patents,
the party becoming aware of such infringement shall promptly give notice of such
infringement to the other party. Any possible action against such alleged
infringement of the Patents will be carried out by either or both of the parties
in accordance with the provisions specified hereinafter in paragraphs (b), (c),
(d) and (e).

              (b) Whenever it would concern a patent or patent application
falling within the definition of Patents and of which Medisorb retains full
title and ownership pursuant to Article 5 a), Medisorb shall use all reasonable
efforts to take action against such infringement in its own name, at its own
expense and on its own behalf.

          If Medisorb fails to take action against such infringement, or if
Medisorb does not use reasonable efforts in carrying out such action after
commencement thereof, within thirty (30) days after the notice referred to in
paragraph (a) above or after having become aware of such infringement, Janssen
US shall be entitled at its own discretion and at its own expense, to take
immediate action against such infringement in its own name, at its own expense
and on its own behalf.  Medisorb will give all reasonable assistance to Janssen
in taking such action in accordance with Article 6(e), including giving Janssen
the authority to file and prosecute such suit and, if necessary, being named a
party in such action.  If Janssen US commences or assumes such action, Janssen
US may credit [                              ] of any royalty otherwise due to
Medisorb for sales in such country or countries against the amount of the
expenses and costs of such action, including without limitation, attorney fees
actually incurred by Janssen US.  The amount of expenses so deducted shall be
paid to Medisorb out of the recoveries, if any, received by Janssen US as a
result of such action.  Except for such repayment of royalties deducted, Janssen
US shall be entitled to retain all recoveries therefrom.

          In no event shall Medisorb settle with such infringing third party in
the Field without the prior written consent of Janssen US.

              (c) Whenever it would concern a patent or patent application
falling within the definition of Patents and of which Janssen US or any of its
Affiliates retains full title and ownership pursuant to Article 5 B), Janssen US
shall have the right but not the obligation to take action against such
infringement in its own name, at its own cost and on its own behalf. If Janssen
US fails to take action against such infringement, or if Janssen US does not use
reasonable efforts in carrying out such action after commencement thereof,
within thirty (30) days after the notice referred to in paragraph (a) above or
after having become aware of such infringement, Medisorb shall be entitled at
its own discretion and at its own expense, to take action against such
infringement. Medisorb shall be entitled to retain all recoveries, if any,
therefrom.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                       Page 9
License Agreement

              (d) Whenever it would concern a patent or patent application
falling within the definition of Patents and of which Janssen US or any of its
Affiliates and Medisorb jointly retain full title and ownership pursuant to
Article 5 (c), and whenever in such case the infringing product would be a drug
product falling within the definition of the Field, Janssen US shall have the
right but not the obligation to take action against such infringement in its own
name, at its own cost and on its own behalf. If Janssen US fails to take action
against such infringement, or if Janssen US does not use reasonable efforts in
carrying out such action after commencement thereof, within thirty (30) days
after the notice referred to in paragraph (a) above or after having become aware
of such infringement, Medisorb shall be entitled at its own discretion and at
its own expense, to take action against such infringement, it being understood
that Janssen US will have a continuing right to take over any such action at its
own expense and shall pay to Medisorb from any recoveries Janssen US receives
(i) Medisorb's expenses and (ii) from any sums remaining after deduction of
Medisorb's and Janssen US's expenses, an amount proportionate to Medisorb's
expenses in relation to Janssen US's expenses.

          Whenever it would concern a patent or patent application falling
within the definition of Patents and of which Janssen US or any of its
Affiliates and Medisorb jointly retain full title and ownership pursuant to
Article 5 (c), and whenever in such case the infringing product would be a drug
product falling outside the definition of the Field, Medisorb shall have the
right but not the obligation to take action against such infringement in its own
name, at its own cost and on its own behalf.  If Medisorb fails to take action
against such infringement, or if Medisorb does not use reasonable efforts in
carrying out such action after commencement thereof, within thirty (30) days
after the notice referred to in paragraph (a) above or after having become aware
of such infringement, Janssen US shall be entitled at its own discretion and at
its own expense, to take action against such infringement, it being understood
that Medisorb will have a continuing right to take over any such action at its
own expense.  If Janssen US commences or assumes such action, Janssen US may
credit [                           ] of any royalty otherwise payable to
Medisorb payable hereunder against the amount of the expenses and costs of such
action, including without limitation, attorney fees actually incurred by Janssen
US.  The amount of expenses so deducted shall be paid to Medisorb out of the
recoveries, if any, received by Janssen US as a result of such action.  Except
for such repayment of royalties deducted, Janssen US shall be entitled to retain
all recoveries therefrom.

              (e) Each party agrees to cooperate reasonably with the other party
in such litigation, including making available to the other party records,
information, and evidence relevant to the infringement of the Patent.

          (7) Third Party Intellectual Property Rights
              ----------------------------------------

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                      Page 10
License Agreement

              (a) Medisorb warrants that to the best of its current knowledge
and belief the Products to be developed hereunder will not infringe the patent
rights of any third party.

              (b) In the event that the manufacture, use or sale of the Product
would constitute an infringement of the rights of a third party in the Territory
because of the use of the Patents or Medisorb's know how, each party shall, as
soon as it becomes aware of the same, notify the other thereof in writing,
giving in the same notice full details known to it of the rights of such third
party and the extent of any alleged infringement.  The parties shall after
receipt of such notice meet to discuss the situation, and, to the extent
necessary attempt to agree on a course of action in order to permit Janssen US
to practice the license granted hereunder.  Such course of action may include:
(a) modifying the Product or its manufacture so as to be noninfringing; (b)
obtaining an appropriate license from such third party; or (c) fight the claim
or suit.  In the event that within a short period of time, the parties fail to
agree on an appropriate course of action Janssen US may decide upon the course
of action in the interest of the further development, manufacturing or
commercialization of the Product.

              (c) In the event that the parties cannot agree on modifying the
Product or in the case that such modification would not be economically viable
or regulatory feasible, Janssen US, whenever it relates to know how, whether
patented or not, owned by Janssen US in accordance with the provisions of
Article 5 (b) and (c), or Medisorb, whenever it relates to know how, whether
patented or not, owned by Medisorb in accordance with the provisions of Article
5 (a), will have the right to negotiate with such third party for such license.
Both parties hereto will in any event in good faith consult with each other with
respect to such negotiations and the party negotiating such license as indicated
above, will make every effort to minimize the amount of license fees and
royalties payable thereunder.  In no event shall either party as a result of
such settlement, grant a sublicense or cross license to the third party to
settle the suit, without the prior written approval of the other party.  In the
event that such negotiations result in a consummated agreement, any license fee
and/or royalties to be paid thereunder shall be paid by the party responsible
for the negotiations as indicated above, [                     ] of any license
fees or royalties paid by Janssen US under such license will be creditable
against royalties due to Medisorb hereunder.

              (d) In the event that either or both parties would further to such
notification under Paragraph 7 (b) decide to defend such suit or claim in which
a third party alleges that the manufacture, use or selling of the Product in the
Territory infringes said third party's patent in, Janssen US shall have the
right to apply [                   ] of the royalties due to Medisorb on the
sales of the allegedly infringing Product against its litigation expenses.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                      Page 11
License Agreement

          (8)  Term:
               ---- 

              (a) Except as otherwise provided herein, this Agreement and the
term of the license granted to Janssen US hereunder shall commence on the date
first written above and shall expire (i) upon expiration of the last to expire
Patent or (ii) fifteen (15) years after the date of the first commercial sale of
Product in the Territory, whichever is later; provided, that in no event shall
the license granted hereunder expire later than the twentieth anniversary of the
first commercial sale of Product. After expiration of the license granted to
Janssen US hereunder, Janssen US shall retain a fully paid-up non-exclusive
license to manufacture, use and sell Products in the Field in the Territory.

              (b) Medisorb may convert the exclusive license granted under this
Agreement to non-exclusive if Janssen US does not maintain the following minimum
annual royalty payments to Medisorb.  With respect to the entire Territory, the
minimum royalty obligation will first apply to the twelve month period following
the anniversary of the end of the month in which the Product was launched.
During the first twelve month period and each subsequent twelve month period
that such minimum royalty obligation is applicable, the minimum royalty amount
to be paid by Janssen US will be calculated by multiplying the applicable
royalty rate by [           ] percent of the actual aggregate net sales of other
[                   ] products in the Territory during such twelve month period.

Janssen US shall have the right to make up any shortfall in minimum royalty
payments from Product sales in the Territory provided, such  make-up payment is
made at the same time and in the same manner as required for the underlying
minimum royalty obligation.

              (c) In the event that either party shall enter or be put into
voluntary or compulsory liquidation or have a receiver appointed or default in
the observance or performance of its obligations under this Agreement and shall
fail to remedy such default within ninety (90) days after the delivery of
written notice from the other party, the other party shall be entitled upon
giving written notice to terminate this Agreement.

              (d) Janssen US may terminate this Agreement without cause upon 30
days prior written notice. Thereafter, Janssen US shall have no further rights
or privileges with respect to the use of Medisorb Technology in Products and
Medisorb shall be under no further obligation of non-competition or exclusive
dealing.

              (e) Any early termination of the Agreement shall be without
prejudice to the rights of either party against the other accrued under this
Agreement prior to termination.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                      Page 12
License Agreement

              (f) Upon any termination of this Agreement, any remaining
inventory of Product may be sold, provided all royalties otherwise due hereunder
are paid with respect to such sales.

              (g) All rights and licenses granted under or pursuant to this
Agreement by Medisorb to Janssen U.S. are, and shall otherwise be deemed to be,
for purposes of Section 365(n) of Title 11, U.S. Code (the "Bankruptcy Code"),
licenses to "intellectual property" as defined under section 101(60) of the
Bankruptcy Code.  The parties agree that Janssen, as a licensee of such rights
under this Agreement, shall retain and may fully exercise all of its rights and
elections under the Bankruptcy Code.

          (9)  Confidentiality:
               --------------- 

              (a) Each party agrees to keep confidential and to not use for any
purpose other than as set forth herein all technical information and materials
supplied by the other hereunder and any information a party may acquire about
the other or its activities as a result of entering into this Agreement,
provided that such obligation shall not apply to technical information or
material which:  (i) was in the receiving party's possession without restriction
prior to receipt from the other party or its Affiliates; (ii) was in the public
domain at the time of receipt; (iii) becomes part of the public domain through
no fault of the receiving party; (iv) shall be lawfully received from a third
party with a right of further disclosure; (v) shall be required to be disclosed
by law, by regulation or by the rules of any securities exchange.

              (b) Except as may be otherwise provided herein, the
confidentiality obligations as set out in this Section shall continue so long as
this Agreement remains in force and thereafter for a period of seven (7) years.

              (c) Janssen US shall cause its Affiliates and Sublicensees to
abide by the obligations of confidentiality with respect to unpublished
information within the Patents and Technical Information.

              (d) Any confidential information relating to the subject matter of
this Agreement imparted to the other party prior to the execution of this
Agreement shall be considered to fall under the terms of this Agreement.

          (10) Disclaimer of Warranty: Medisorb makes no representations or
               ----------------------                                      
warranties, express or implied, with respect to the Medisorb Patents and
Technical Information licensed to Janssen US hereunder, including without
limitation any warranties of merchantability or fitness for a particular
purpose.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                      Page 13
License Agreement

          (11)  Liability
                ---------

              (a) Janssen US agrees to indemnify, defend and hold harmless
Medisorb from and against any liability, loss, damages and expenses (including
reasonable attorney fees) Medisorb may suffer as the result of claims, demands,
costs or judgments which may be made or instituted against Medisorb by reason of
personal injury or damage to property arising out or caused by Janssen US's
promotion, use and sale of the Product, except where such liabilities claims,
demands, costs or judgments are caused by Medisorb's failure to provide Janssen
US with any information as specified in Section 12 (c) and Article 13. Medisorb
will notify Janssen US as soon as it becomes aware of any such claim or action
and agrees to give reasonable assistance in the investigation and defense of
such claim or action it being understood that it shall allow Janssen US to
control the disposition of the same.

              (b) Medisorb agrees to indemnify, defend and hold harmless Janssen
US from and against any liability, loss, damages and expenses (including
reasonable attorney fees) Janssen US may suffer as the result of claims,
demands, costs or judgments which may be made or instituted against Janssen US
by reason of personal injury or damage to property arising out or caused by
Medisorb's failure to provide Janssen US with any information as specified in
Section 12 (c) and Article 13.

              (c) In no event shall either party be liable for loss of profits,
loss of goodwill or any consequential or incidental damages of any kind of the
other party.

          (12) Product Information and Adverse Drug Events
               -------------------------------------------

              (a) As Janssen US has superior knowledge of the end-use
applications to which Products licensed hereunder will be put, Janssen US is
responsible for providing third parties with adequate information as to the
medical profile of such Products. Janssen US will provide Medisorb with copies
of the product information document which is part of the NDA for the Product.

              (b) Medisorb does not claim the expertise to judge whether
Product(s) will perform acceptably in Janssen US's application(s). Janssen US is
the sole judge as to whether Product(s) will perform acceptably in Janssen US's
application(s). Janssen US represents and warrants on an on-going basis during
the term of this agreement that it has the capability to assess the suitability
of Product(s) in Janssen US's application(s) and agrees to conduct adequate
testing to confirm the safety and efficacy of Products prior to
commercialization.

              (c) Medisorb will provide to Janssen US promptly after its
discovery by Medisorb, any information in its possession which indicates adverse
effects in

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                      Page 14
License Agreement

humans associated with the Products, including the bioabsorbable polymeric
components thereof, licensed hereunder.  For the purpose of this Agreement
"adverse event" shall mean an experience which is noxious and unintended and
which occurs at doses normally used in man for the prophylaxis, diagnosis or
therapy of a disease or for the modification of a physiological function and any
report of an overdose.

          (13)  Government Approvals
                --------------------

          Janssen US shall be responsible for conducting all necessary testing
as well as determining what, if any, government approvals are required for the
use and sale of Product licensed hereunder and shall comply with all such
requirements prior to and following the sale or distribution of such Products.

          Medisorb shall cooperate fully with Janssen US in obtaining regulatory
approvals for Product licensed hereunder and shall, at Janssen US's request,
provide appropriate regulatory authorities with any and all information
concerning Medisorb's technology, Medisorb polymers and Medisorb's manufacturing
process for such Product.

          In this respect Medisorb undertakes that it has submitted or will as
soon as possible submit a type IV Drug Master File to the FDA identifying
Medisorb's method of manufacture, release specifications and testing methods
used in the manufacture of Medisorb Polymers and a type I Drug Master File of
Medisorb's manufacturing facilities where Product may be manufactured.  Medisorb
will authorize Janssen U.S. at its request to cross-reference any Drug Master
Files relating to the Medisorb Polymers.

          (14) Force Majeure:  Neither party shall be liable for its failure to
               -------------                                                   
perform any of its obligations hereunder if such failure is occasioned by a
contingency beyond its reasonable control including, but not limited to,
occurrences such as strikes or other labor disturbances, lock out, riot, war,
default by a common carrier, fire, flood, storm, earthquake, other acts of God,
inability to obtain raw materials, failure of plant facilities or government
regulation, act or failure to act. Each party shall notify the other immediately
upon occurrence or cessation of any such contingencies. If such contingency
continues unabated for at least 180 consecutive days, either party shall have
the right to terminate this Agreement without further obligation beyond those
actually incurred prior to such termination.

          (15) Press Communications:  Neither party shall originate any
               --------------------                                    
publicity, news release or public announcement, written or oral relating to this
Agreement, including its existence, without the prior written approval of the
other party.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                      Page 15
License Agreement

          (16) Notices:  Any legal notice required or permitted hereunder shall
               -------                                                         
be considered properly given if in writing and sent by first class mail,
certified mail or by telefacsimile to the party being notified at the respective
address of such party as follows:

          If to Medisorb:

                    Medisorb Technologies International L.P.
                    6954 Cornell Road
                    Cincinnati, OH 45242

                    Facsimile: 513-489-2348

          If to Janssen US:

                    Janssen U.S.
                    1125 Trenton-Harbourton Road
                    P.O. Box 200
                    Titusville, New Jersey 08560-0200

                    Facsimile:  609-630-2616

                    with a copy to Janssen Pharmaceutica International
                                  Kollerstrasse 38
                                  6300 Zug 6
                                  Switzerland
                                  Facsimile: 00-41-42449565

Such notice shall be effective upon receipt or upon refusal to accept such
notice. In any case, notice shall be presumed effective no later than five (5)
days after such notice is sent.

          Neither party shall originate any publicity, news release or public
announcement, written or oral, relating to this Agreement, including its
existence, without the written approval of the other party.

          (17) Assignment:  This Agreement shall not be assigned by either party
               ----------                                                       
without the prior written consent of the other party; provided, however, that
assignment shall be permitted without such consent to any party, not less than
50% of the total interest of which owns, is owned by, or is under common control
with the assigning party. In the event of any such permitted assignment the
assignee shall be subject to and shall agree in writing to be bound by the terms
and conditions of this Agreement.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                      Page 16
License Agreement

          (18) Dispute Resolution:  The parties shall amicably discuss and
               ------------------                                         
negotiate any matters which arise under this Agreement and are not specifically
set forth hereunder.  If any disputes arise under this Agreement, the parties
shall use their reasonable efforts to meet and resolve such disputes.  In the
event that the parties are unable to resolve any such disputes, then both
parties hereby agree to submit said disputes to the jurisdiction of the
competent courts of the State of New Jersey and agree that any litigation in any
way related to this Agreement shall be submitted to such courts and that same
shall be subject to the laws of the State of New Jersey without regard to its
rules respecting choice of law.

          (19) Severability:  In the event any one or more of the provisions of
               ------------                                                    
this Agreement should for any reason be held by any court or authority having
jurisdiction over this Agreement or any of the parties hereto to be invalid,
illegal or unenforceable such provision or provisions shall be validly reformed
to as nearly approximate the intent of the parties as possible and, if
unreformable; shall be divisible and deleted in such jurisdiction, elsewhere
this Agreement shall not be affected.

          (20) Captions:  The captions of this Agreement are for convenience
               --------                                                     
only, and shall not be deemed of any force or effect whatsoever in construing
this Agreement.

          (21) Waiver:  The failure on the party of a party to exercise or
               ------                                                     
enforce any right conferred upon it hereunder shall not be deemed to be a waiver
of any such right, nor operate to bar the exercise or enforcement thereof at any
time thereafter.

          (22) Survival:  The following Articles of this Agreement shall survive
               --------                                                         
the termination or expiration of this Agreement:  5, 9, 10, 11, 15, 17,  and 18.

          (23) Miscellaneous:  This Agreement may be executed by the parties
               -------------                                                
hereto in counterparts, each of which when so executed and delivered shall be
considered to be an original, but all such counterparts shall together
constitute but one and the same instrument.  This Agreement is the complete
agreement of the parties and supersedes all previous understandings and
agreements relating to the subject matter hereof.  Neither this Agreement nor
any of the terms hereof may be terminated, amended, supplemented, waived or
modified orally , but only by an instrument in writing signed by the party
against whom enforcement of the termination, amendment, supplement, waiver or
modification is sought.

          IN WITNESS WHEREOF, the duly authorized representatives of the parties
hereto have executed this Agreement as of the day and year first above written.


JANSSEN PHARMACEUTICA INC.

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.
<PAGE>
 
Janssen US-Medisorb                                                      Page 17
License Agreement

By: _________________________
Name: _______________________
Title: ______________________
Date: _______________________


{Second Janssen  Signatory}
---------------------------


By: _________________________
Name: _______________________
Title: ______________________
Date: _______________________


MEDISORB TECHNOLOGIES INTERNATIONAL  L.P.
by:  Medisorb Technologies
      International, Inc.,
      its General Partner


By: __________________________
Name:  David R. Lohr
      ------------------------
Title: President
       -----------------------
Date: ________________________

12059501.doc

     THIS EXHIBIT HAS BEEN REDACTED AND IS THE SUBJECT OF A CONFIDENTIAL
     TREATMENT REQUEST. REDACTED MATERIAL IS BRACKETED AND HAS BEEN FILED
     SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.