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License Agreement [Amendment No. 1] - Schering AG and BioMedicines Inc.

COMPANY LETTERHEAD

Biomedicines, Inc.

Attn: K. Alice Leung

CEO

2000 Powell Street

Suite 1640

Emeryville, California 94608

U.S.A.

Your Ref.		Your letter dated		Our Ref. (Please indicated when replying)		Date
				RA/UK/Cie (4b3108_1)		2004-09-03

Amendment #1 to the License Agreement

Dear Alice,

Referring to our telephone conference on [*] and your fax of that same day, we have re-discussed internally the situation concerning the manufacture of drug substance and drug product under the License Agreement between Schering and Biomedicines dated February 1, 1999 (the “License Agreement”).  After such discussion, we have the following comments:

1.   Manufacture of Drug Substance for Registration Batch

For the sake of clarity, we hereby exercise again our option pursuant to Section 5.1 of the License Agreement to manufacture drug substance for the Licensed Product (as defined in the License Agreement) required for manufacture of the first Registration Batch (as defined in the License Agreement).  The exercise of this option shall, however, only become effective when Biomedicines has countersigned and returned to Schering the CMC Plan (as defined in the License Agreement) which is attached to this letter.

2.   Manufacture of Drug Substance for Further Development and Commercialization

As a final decision can only be made if the CMC Plan is amended (cf. Section 1 above) and such amendment has not yet been finalized, we suggest that Section 5.1 of the License Agreement be amended to the effect that the option pursuant to Section 5.1 of the License Agreement concerning the manufacture of drug substance required for subsequent development and commercialization of Licensed Product be exercisable within two (2) weeks after Schering has received the countersigned new CMC Plan from Biomedicines.

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

3.   Manufacture of Drug Product for Further Development and Commercialization

As more communication is required between Schering and Biomedicines in order to prepare the manufacture of drug product for Licensed Product.  We suggest that Section 5.2 of the License Agreement be amended to the effect that the option pursuant to Section 5.2 of the License Agreement concerning the manufacture of drug product required for subsequent development and commercialization of Licensed Product be exercisable within one (1) month after Schering has been notified of a decision by biomedicines to have such drug product manufactured, this notification not to be made before November 1, 2004.

4.   Reimbursement of CMC Costs

We hereby confirm the agreement between Schering and Biomedicines that the invoice periods pursuant to Section 4.7 of the License Agreement concerning the reimbursement of the CMC Costs (as defined in the License Agreement) be amended to the effect that Schering shall invoice Biomedicines on a quarterly basis for CMC Costs incurred by Schering in the quarter preceding the quarter of invoice.

In all other respects, the terms of the License Agreement shall remain unchanged.

To signify acceptance of the aforementioned issues concerning the amendment of the License Agreement, please counter-sign, date and return to us the attached duplicate of this letter.

Yours sincerely

Schering Aktiengesellschaft

/s/ Hong Chow			/s/ H. Neh
Hong Chow			Harribert Neh
						Date:
						Accepted by
						Biomedicines, Inc.
						/s/ K. Alice Leung
						K. Alice Leung
Attachment:
CMC Plan

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