DEVELOPMENT AND EXCLUSIVE DISTRIBUTION AGREEMENT

*Confidential Treatment Requested Under
17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

DEVELOPMENT AND EXCLUSIVE DISTRIBUTION AGREEMENT

     This Development and Exclusive Distribution Agreement (“Agreement”) is entered into on November 7, 2006 (“Effective Date”) between AKORN, INC., a Louisiana corporation having a principal place of business at 2500 Millbrook Drive, Buffalo Grove, Illinois 60089-4694, United States of America (“AKORN”) and SERUM INSTITUTE of INDIA, LTD., a Company incorporated under the laws of India, having its principal place of business at S. No. 212/2, Off Soli Poonawalla Road, Hadapsar, Pune — 411 028, Maharashtra, INDIA, (“SII”) (each a “Party” and collectively, the “Parties”).

     A. The Parties have previously entered into a Memorandum of Understanding dated April 4, 2006 with respect to their collaboration in developing monoclonal antibody drugs;

     B. SII has entered into a definitive agreement with [...***...] (as defined below) providing it with certain exclusive rights to rabies monoclonal antibody and with the right to nominate a distributor for distribution of rabies monoclonal antibody products;

     C. As provided in the above referenced Memorandum of Understanding, AKORN desires to receive from SII exclusive marketing and distribution rights in North, Central, and South America for the rabies monoclonal antibody; and

     D. The Parties desire to set forth their agreement with respect to such exclusive rights and their collaboration in developing rabies monoclonal antibody, pursuant to the term and conditions set forth below.

     NOW, THEREFORE, in consideration of the mutual promises herein, and other valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the Parties, the Parties agree as follows:

ARTICLE 1

     1.1 AKORN Indemnitees . The term “AKORN Indemnitees” has the meaning ascribed to it in Section 10.1.

     1.2 Anti-D Notice . The term “Anti-D Notice” has the meaning ascribed to it in Section 2.6.2.

     1.3 Applicable Laws . The term “Applicable Laws” means all applicable laws and regulations, including, but not limited to the United States Federal Food, Drug, and Cosmetic Act and the Public Health Service Act, and including all local and municipal ordinances and the regulations of any agency or public authority having jurisdiction over the manufacture, sale and delivery of Products.

     1.4 Affiliate . The term “Affiliate” means with respect to any Party, any party controlling, controlled by or under common control with any such Party. For purposes hereof, “control” and its derivatives means the possession, directly or indirectly, of the power to direct or

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with the Securities and Exchange Commission.

*Confidential Treatment Requested Under
17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

cause the direction of the management and policies of a Party, whether through the ownership of voting securities or voting interests, by contract or otherwise.

     1.5 BLA . The term “BLA” means a biologics license application submitted to FDA to obtain license approval for a biologic product, or any successor application or foreign equivalent.

     1.6 CBER . The term “CBER” means the FDA’s Center for Biologics Evaluation and Research that is responsible for regulating biological products for human use under applicable United States federal laws or any successor authority.

     1.7 cGMP . The term “cGMP” means current Good Manufacturing Practices as applicable in the Territory.

     1.8 Collaboration Agreement . The term “Collaboration Agreement” means the Collaboration and License Agreement between SII and [...***...] .

     1.9 Confidential Information . The term “Confidential Information” means all confidential information of a Party relating to any designs, know-how, inventions, technical data, ideas, uses, processes, methods, formulae, research and development activities, work in process, or any scientific, engineering, manufacturing, marketing, business or financial information relating to the disclosing Party, its present or future products, sales, suppliers, customers, employees, investors or business, whether in oral, written, graphic or electronic form disclosed by the Parties prior to or during this Agreement (which is marked confidential or acknowledged as being confidential prior to disclosure). If the Confidential Information is disclosed orally or visually, it shall be identified as such at the time of disclosure and confirmed in writing by the disclosing party within thirty (30) days of disclosure. Confidential Information shall also include any other information in oral, written, graphic or electronic form which, given the circumstances surrounding such disclosure, would be considered confidential. This Agreement shall be deemed Confidential Information.

     1.10 FDA . The term “FDA” means the United States Food and Drug Administration.

     1.11 First Commercial Sale . The term “First Commercial Sale” with respect to a Product means the first sale or other disposal of such Product in a country in the Territory after receipt of Marketing Authorization.

     1.12 Forecast . The term “Forecast” has the meaning ascribed to it in Section 5.2.

     1.13 [...***...] . The term “ [...***...] ” means the MAb, known as [...***...] , that effectively neutralizes all known strains of the Rabies virus.

     1.14 Initial Price . The term “Initial Price” has the meaning ascribed to it in Section 7.1.1.

     1.15 Insignia . The term “Insignia” means trademarks, trade names, logos, symbols, badges, labels, decorative designs, packaging designs or similar trade dress.

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with the Securities and Exchange Commission.

*Confidential Treatment Requested Under
17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

     1.16 Intellectual Property Rights . The term “Intellectual Property Rights” means all United States and worldwide trademarks, service marks, trade dress, logos, copyrights, rights of authorship, inventions, patents, rights of inventorship, moral rights, rights of publicity and privacy, trade secrets, rights under unfair competition and unfair trade practices laws, and all other intellectual and industrial property rights related thereto.

     1.17 MAb . The term “MAb” means fully human monoclonal antibodies.

     1.18 Marketing Authorization . The term “Marketing Authorization” means all necessary registrations, permits, licenses, authorizations, approvals and notifications by the relevant regulatory authority in a country in the Territory for the development, manufacturing, testing, labeling, importation, storage, promotion, sale, distribution and use of a Product in such country.

     1.19 Milestones . The term “Milestones” means the objectives and deliverables described and set forth in the Milestone Schedule.

     1.20 Milestone Schedule . The term “Milestone Schedule” means Exhibit A, attached hereto and fully incorporated herein.

     1.21 [...***...] . The term “ [...***...] ” means the [...***...] , having its principal place of business at [...***...] .

     1.22 Net Sales Value . The term “Net Sales Value” means the gross amount billed or invoiced by A KORN on sales of Products, less the following deductions, to the extent not already applied and consistent with US GAAP: (a) customary trade, quantity, or cash discounts to non-affiliated brokers or agents to the extent actually allowed and taken; (b) amounts repaid or credited by reason of rejection or return; (c) to the extent separately stated on purchase orders, invoices, or other documents of sale, any taxes or other governmental charges levied on the sale, transportation, delivery, or use of a Product which is paid by or on behalf of AKORN; (d) duties and charges, including state government levy and customs duties, in the Territory, in respect of the Products, including any duties, taxes, VATs or similar charges arising with respect to the importation by and delivery of Products to AKORN; (e) inbound carriage, insurance and freight costs incurred by AKORN for Products; and (f) outbound transportation costs prepaid or allowed and costs of insurance in transit. If Product is sold to third parties in transactions that are not arm’s length between buyer and seller, then the gross amount to be included in the calculation of Net Sales Value for the sale of such Product shall be the gross amount that would have been charged had the sale been at arm’s length, which shall be deemed, when determinable, to be the average selling price for Product in the given country in the Territory (or if not available, in the Territory) for the ninety (90) day period prior to the relevant sale.

     1.23 Phase I Clinical Trial . The term “Phase I Clinical Trial” means a human clinical trial in any country which generally provides for the initial introduction into humans of a Product with the primary purpose of determining its metabolism and pharmacokinetic properties and pharmacology, or could otherwise meet the definition of 21 CFR 312.21 or its foreign equivalent.

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with the Securities and Exchange Commission.

*Confidential Treatment Requested Under
17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

     1.24 Phase II Clinical Trial . The term “Phase II Clinical Trial” means a human clinical trial in any country which utilizes a larger base of humans in order to establish effectiveness of a Product and further evaluate its safety, or could otherwise meet the definition of 21 CFR 312.21 or its foreign equivalent.

     1.25 Phase III Clinical Trial . The term “Phase III Clinical Trial” means a human clinical trial in any country which provides for the continued trials of a Product on sufficient numbers of patients to establish its safety and efficacy that is needed to evaluate the overall benefit-risk relationship of the Product and an adequate basis for physician labeling, or could otherwise meet the definition of 21 CFR 312.21 or its foreign equivalent.

     1.26 Product . The term “Product” means (i) a [...***...] product developed by SII and/or its licensors; and (ii) any other MAb product, added to this Agreement pursuant to a Schedule hereto adopted pursuant to Section 2.6.

     1.27 Product Sales Share . The term “Product Sales Share” means for each calendar quarter, (i) with respect to the territories of North America (and, only upon and to the extent agreed by the Parties pursuant to a separate written agreement as provided under Section 2.7, Europe), that amount equal to sixty percent (60%) of the Net Sales Value achieved by AKORN in such calendar quarter in such territories; and (ii) with respect to the territories of Central America and South America, that amount equal to fifty percent (50%) of the Net Sales Value achieved by AKORN in such calendar quarter in such territories.

     1.28 Quality Agreement . The tem “Quality Agreement” has the meaning ascribed to it in Section 3.1.

     1.29 Satisfactory Completion . The term “Satisfactory Completion” means, with respect to each phase of the clinical development program (Phase I, II or III Clinical Trials), completion of such phase and meeting the protocol requirements with conclusive data analysis that permits the clinical development program to proceed to the next phase, (in the case of Phase I or II Clinical Trials), or to proceed to Marketing Approval submission (in the case of Phase III Clinical Trials), in accordance with Applicable Laws.

     1.30 Schedule . The term “Schedule” means an addendum to this Agreement that may be agreed upon by the Parties, which in each case shall set forth, as applicable, additional types of MAb that will be subject to this Agreement, corresponding payment obligations, and other terms and conditions as mutually agreed to by the Parties. Upon execution by both Parties, each such executed Schedule shall be attached to this Agreement and fully incorporated herein by this reference.

     1.31 SII Indemnitees . The term “SII Indemnitees” has the meaning ascribed to it in Section 10.2.

     1.32 Territory . The term “Territory” means the various countries and territories located in North America, Central America, South America, and, to the extent agreed by the Parties pursuant to a separate written agreement as provided under Section 2.7, Europe.

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with the Securities and Exchange Commission.

*Confidential Treatment Requested Under
17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

     1.33 Variable Price . The term “Variable Price” has the meaning ascribed to it in Section 7.1.2.

ARTICLE 2

     2.1 Product Development .

            2.1.1 SII shall be solely responsible for the development of the Products, including, but not limited to, the use of its commercially reasonable efforts to reach all Milestones, and develop all materials required to file Marketing Authorizations therefor as required by regulatory authorities in the Territory. Pursuant to such development efforts, SII shall be responsible to conduct, at its sole cost, all the pre-clinical pharmacological studies, toxicology studies, and Phase I, II and III Clinical Trials for Products as required for United States Marketing Authorizations.

            2.1.2 All development costs incurred by SII shall be borne solely by SII. SII shall expeditiously commence and use commercially reasonable efforts to complete development of a stable, commercially saleable Product in accordance with the Milestone Schedule, cGMP, and Applicable Laws, which Product does not infringe or potentially infringe any Intellectual Property Rights owned or licensed by any other person in the Territory.

     2.2 BLA Filing . SII shall file a BLA for Products as soon as practicable following SII’s completion of all necessary corresponding pre-clinical pharmacological and toxicology testing and Phase I, II and III Clinical Trials for United States filing. Such BLA shall be filed to allow manufacturing of each Product by either [...***...] or SII, as mutually agreed by the Parties. SII and/or [...***...] shall be responsible for all filing costs associated with filing the BLA.

     2.3 Ownership of Marketing Authorizations . Any application for Product Marketing Authorization and each corresponding Product Marketing Authorization shall be the sole and exclusive property of SII or [...***...] , as more fully set forth in the Collaboration Agreement.

     2.4 Cooperation . Each Party shall reasonably cooperate with the other Party (including providing all reasonably necessary information in its possession, taking all reasonably necessary actions and executing all reasonably necessary instruments) in connection with the preparation, filing, prosecution, seeking and obtaining the Marketing Authorizations.

     2.5 Representatives . Upon execution of this Agreement, SII and AKORN shall each select one (1) program manager who will be responsible for directing and overseeing all activities regarding this Agreement and for transmitting and receiving all communications regarding this Agreement on behalf of its respective company. Each Party may change its designated program manager at any time effective upon providing written notice to the other Party.

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with the Securities and Exchange Commission.

*Confidential Treatment Requested Under
17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

     2.6 Additional MAb Products .

            2.6.1 The Parties may enter into one or more Schedules to add additional types of MAb to this Agreement. A Schedule shall be separately executed by both Parties to be valid. Once a given Schedule has been fully executed by the Parties, it shall be incorporated into and governed by the terms and conditions of this Agreement. In the event any provision in a Schedule conflicts with any portion of this Agreement, the terms of the Schedule shall govern. No addition, change or modification to any Schedule will be effective unless made in writing and signed by both Parties.

            2.6.2 During the term of this Agreement, SII grants AKORN a first option to obtain exclusive marketing rights in the Territory for SII rights in Anti-D MAb. SII shall provide notice to and shall consult with AKORN with respect to its negotiations with [...***...] with respect to Anti-D MAb. SII shall notify AKORN in writing immediately upon SII’s receipt of rights to Anti-D MAb from [...***...] . Such notice shall disclose all material disclosable specific terms of the Collaboration Agreement that are added with respect to Anti-D MAb as required by [...***...] and any other specific SII obligations with respect to Anti-D MAb required by [...***...] , subject to SII’s compliance with any confidentiality provisions in its agreements with [...***...] (“Anti-D Notice”). AKORN shall have the period of ninety (90) days to elect whether to exercise such option and enter into a Schedule containing exclusive marketing rights in the Territory for Anti-D MAb from SII. AKORN shall exercise this option by notifying SII in writing of its election within the ninety (90) day period following its receipt of the Anti-D Notice. If AKORN exercises such option, SII and AKORN shall enter into a Schedule providing for exclusive marketing rights in the Territory for Anti-D MAb from SII on terms that are consistent with the terms and conditions in this Agreement and with any additional specific terms with respect to Anti-D MAb required by [...***...] and as disclosed in the Anti-D Notice. Should AKORN fail to exercise such option within the ninety (90) day period following its receipt of the Anti-D Notice, SII shall be free to commercialize and market Anti-D MAb on its own or with any other third party.

     2.7 Addition of Europe to Territory . During the term of this Agreement, SII grants AKORN a first option to expand the Territory to include Europe in accordance with the terms of this Section 2.7. To the extent that SII has a good faith intent to grant marketing rights to Products in Europe (and prior to any such grant), SII shall communicate such intent to AKORN and the Parties shall negotiate in good faith, during the following period of ninety (90) days, the terms of such Territory expansion, which terms may include minimum reasonable annual Product sales requirements for Europe as agreed by the Parties. If the Parties fail to agree with respect to the terms of such Territory expansion within the foregoing ninety (90) day period, SII shall be free to grant the rights to any third party.

ARTICLE 3

     3.1 Quality Agreement . As soon as practicable following the Effective Date, but not later than the date that SII or [...***...] , as the case may be, begins production of clinical batches, the Parties shall enter into a quality agreement (the “Quality Agreement”). The Quality Agreement shall contain provisions consistent with the provisions in this Agreement and such other provisions as otherwise required for compliance with cGMP and all other applicable FDA

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with the Securities and Exchange Commission.

*Confidential Treatment Requested Under
17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

requirements. Prior to production and supply of any clinical batches, AKORN’s program manager and quality assurance managers shall be permitted to conduct a quality inspection of the manufacturing facilities and to provide SII with a written notice setting forth a list of discrepancies in compliance with cGMP and all other applicable FDA requirements. SII shall correct all items rightly objected to by AKORN and shall demonstrate compliance with cGMP and other applicable FDA requirements within a reasonable period following receipt of AKORN’s written notice. Notwithstanding AKORN’s quality inspection and other activities pursuant to this Section 3.1, nothing in this Section 3.1 shall alter SII’s responsibilities for compliance with cGMP and FDA requirements, and all other applicable requirements under this Agreement, or release SII from its obligations with respect to such compliance.

     3.2 Product Manufacture . All Products shall be manufactured in conformity with the applicable Marketing Authorization and this Agreement. All Products shall be manufactured in conformity with this Agreement.

     3.3 Right of Access/ Inspections .

            3.3.1 AKORN shall be permitted periodic (not more than once per year) access to the manufacturing facilities for the purpose of conducting inspections and/or audits to determine compliance with the Agreement or the Quality Agreement entered into by the Parties, including audits of SII’s compliance with cGMPs and with environmental and other laws. Upon not less than thirty (30) days prior written notice, SII shall make available to AKORN all documentation, equipment, and facilities relating to this Agreement reasonably required to accomplish the purposes of this provision, provided SII shall not be required to disclose to AKORN any confidential information of third parties, or any propriety information relating to Product manufacture or processing which would not otherwise be public. Notwithstanding anything else to the contrary, any such inspections/audits and any testing performed by AKORN during them, will not relieve SII of liability for Products later found to be defective or for SII’s failure to meet its obligations under this Agreement.

            3.3.2 SII and [...***...] shall be permitted periodic (not more than once per year) access to AKORN’s, and its subcontractor’s, facilities, and records, and personnel for the purpose of conducting inspections and/or audits to determine compliance with this Agreement or the Quality Agreement, including audits of AKORN’s compliance with environmental and other laws. Upon not less than thirty (30) days prior written notice, AKORN shall make available all documentation and facilities relating to the Product upon SII’s request for inspection by SII, [...***...] , or their representatives, including authorized third party consultants, reasonably required to accomplish the purposes of this provision. Notwithstanding anything else to the contrary, any such inspections/audits performed by SII or [...***...] during them, will not relieve AKORN of liability for AKORN’s failure to meet its obligations under this Agreement.

     3.4 Notifications . Each Party shall establish systems to advise the other of any safety or toxicity problem of which either Party becomes aware regarding any Product. Each party will, within five (5) business days following notification, inform the other party in the event of any FDA or other regulatory inspection relating to any Product and will notify the other party in writing of any reportable serious adverse event relating to a Product as required by FDA.

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with the Securities and Exchange Commission.

*Confidential Treatment Requested Under
17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

     3.5 Recalls .

            3.5.1 Prior to the First Commercial Sale of Product, AKORN shall provide SII and [...***...] with a description of its procedure for conducting and documenting Product recalls, which procedure must meet FDA regulations. AKORN shall demonstrate to SII that its systems shall identify the end user of the Product and shall ensure that packaged vials are shipped in compliance with the labeled storage temperature requirements.

            3.5.2 Each Party promptly shall notify the other if any Product is or might reasonably be expected to be the subject of a recall, market withdrawal or correction. AKORN shall be responsible for coordinating any recall, market withdrawal or field correction of Product, pursuant to the procedures provided to SII and [...***...] .

                    (a) A recall, market withdrawal or field correction shall be conducted at the cost of SII to the extent that the cause of such recall is due to the failure of the Product to meet its specifications as set forth in the BLA or other applicable Marketing Authorization during the applicable shelf life. AKORN shall provide SII with a copy of all documents relating to such recall, market withdrawal or field correction at SII’s sole cost and expense. SII shall cooperate with AKORN (including providing AKORN with all data, information and documents requested by AKORN) in connection with such recall, market withdrawal or field correction. To the extent set forth in the first sentence of this subclause (a), SII will bear all other reasonable costs associated with (A) such recall, market withdrawal or field correction (including costs associated with receiving and administering the recalled Product and notification of the recall to those persons whom AKORN deems appropriate); and (B) replacement of such recalled Product.

                    (b) A recall, market withdrawal or field correction shall be conducted at the cost of AKORN to the extent that the cause of such recall is due to acts or omissions after such Product was delivered to AKORN. AKORN shall provide SII with a copy of all documents relating to such recall, market withdrawal or field correction. SII shall cooperate with AKORN (including providing AKORN with all data, information and documents requested by AKORN) in connection with such recall, market withdrawal or field correction, at AKORN’s sole cost and expense. To the extent set forth in the first sentence of this subclause (b), AKORN will bear all other reasonable costs associated with (A) such recall, market withdrawal or field correction (including costs associated with receiving and administering the recalled Product and notification of the recall to those persons whom AKORN deems appropriate); and (B) replacement of such recalled Product.

                    (c) In the event the parties are unable to determine the cause of a recall, then the parties shall share equally all reasonable recall costs related to such recall, market withdrawal or field correction. In the event that it is later determined that such recall, market withdrawal or field correction is the responsibility one Party pursuant to the provisions above, then, subject to the next sentence, such Party shall promptly reimburse the other Party for all recall costs suffered by the other Party in connection with the recall, market withdrawal or field correction. In the event that the Product recall, market withdrawal or field correction resulted from the actions or inactions of both Parties, then the Parties will share all reasonable recall costs equally.

* CONFIDENTIAL TREATMENT REQUESTED — This language has been omitted and filed separately with the Securities and Exchange Commission.

*Confidential Treatment Requested Under
17 C.F.R. §§ 200.80(b)(4), 200.83 and 240.24b-2

ARTICLE 4

     4.1 Appointment . SII hereby appoints AKORN and AKORN hereby accepts appointment as SII’s exclusive distributor of Products in the Territory. Additionally, SII hereby grants to AKORN (i) the exclusive right to use all Marketing Authorizations obtained by SII and/or [...***...] (and licensed to SII) for the Products in the Territory; and (ii) the exclusive right to promote, market, sell and distribute the Products in the Territory.

     4.2 Non-Circumvention . Neither SII nor any of its Affiliates shall (i) appoint another distributor for Products in the Territory; (ii) sell Products to any other party in the Territory; or (iii) directly or indirectly allow any third party to use any Marketing Authorizations with respect to any Products or assist any third party to file, prosecute, seek and obtain any Marketing Authorizations with respect to any Products.

     4.3 Distribution/ Marketing . During the term hereof, AKORN shall promote, market, distribute, and sell Products in the Territory. Market launch in each country in the Territory shall occur not less than sixty (60) days after (i) Marketing Authorization is obtained for such country; and (ii) commercial quantities of Product are delivered by SII to such country. AKORN shall be responsible for implementing a distribution, warehousing and marketing infrastructure sufficient, in AKORN’s sole reasonable discretion, to handle the distribution of the Products. All related costs and expenses shall be borne solely by AKORN. Subject to Section 4.11, AKORN shall have the right to engage sub-distributors to assist it in marketing and distributing the Products in the Territory. AKORN shall supply copies of marketing plans and strategies for the Territory and shall meet quarterly, either in person or telephonically, with SII to review and discuss marketing efforts, plans, and strategies for the Territory.

     4.4 Compliance with Laws . AKORN will comply with all Applicable Laws in the Territory and regulations that govern its activities under this Agreement.

     4.5 Standards . AKORN shall comply with generally accepted distribution, pricing, selling, and marketing standards in the pharmaceutical and biologics industry as applicable in the respective country in the Territory.

     4.6 Promotional Materials . Prior to use, AKORN shall provide SII with copies of all promotional and educational materials