LICENCE AND DEVELOPMENT AGREEMENT

Development Agreement

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XENOVA GROUP PLC | XENOVA LIMITED | XENOVA RESEARCH LIMITED | CANCER RESEARCH TECHNOLOGY LIMITED

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Title: LICENCE AND DEVELOPMENT AGREEMENT
Date: 5/27/2005
Industry: Biotechnology and Drugs Sector: Healthcare

LICENCE AND DEVELOPMENT AGREEMENT, Parties: xenova group plc , xenova limited , xenova research limited , cancer research technology limited

* CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE

SECURITIES AND EXCHANGE COMMISSION. REDACTED PORTIONS OF THIS EXHIBIT ARE MARKED

BY AN [_].

XENOVA LIMITED

AND

XENOVA RESEARCH LIMITED

AND

CANCER RESEARCH TECHNOLOGY LIMITED

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

LICENCE AND DEVELOPMENT AGREEMENT

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

Anderson & Company

76 Wallingford Road

Shillingford

Oxon OX10 7EU

www.andersonsolicitors.com

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

<PAGE>

DEVELOPMENT AND LICENCE AGREEMENT

THIS AGREEMENT dated 10 January 2005 is made between:

(1) XENOVA LIMITED ("Xenova") a company incorporated in England and Wales

whose registered office is at 957 Buckingham Avenue, Slough, Berkshire SL1

4NL; and

(2) XENOVA RESEARCH LIMITED a company incorporated in England and Wales whose

registered office is at 957 Buckingham Avenue, Slough, Berkshire SL1 4NL;

and

(3) CANCER RESEARCH TECHNOLOGY LIMITED ("CRT") a company incorporated in

England and Wales whose registered office is at Sardinia House, Sardinia

Street, London WC2A 3NL.

RECITALS:

A. Xenova Research Limited (formerly known as Cantab Pharmaceuticals Research

Limited) and Cancer Research Campaign Technology Limited (now Cancer

Research Technology Limited) entered into a licence agreement dated 6

March 1996 (the "Prior Licence Agreement") in respect of certain L2 Patent

Rights. The Prior Licence Agreement was terminated by Xenova Research

Limited in January 2004. Under Clause 9.1.3 of the Prior Licence

Agreement, CRT is entitled to request a licence from Xenova Research

Limited in respect of certain intellectual property rights that may be

required by CRT for the commercial exploitation of the L2 Patent Rights.

Xenova Research Limited and CRT intend that the licences granted to CRT

under this Agreement shall be in satisfaction of such obligations as

Xenova Research Limited may have under Clause 9.1.3 of the Prior Licence

Agreement.

B. Xenova Research Limited has assigned the beneficial interest in all of its

right, title and interest in the Xenova Intellectual Property to Xenova,

although certain Xenova Patents remain registered with Patent Offices in

the name of Xenova Research Limited (or Cantab Pharmaceuticals Research

Limited). Accordingly, Xenova is the beneficial owner of certain Xenova

Patents, and possesses certain Xenova Know-how and Xenova Materials

relating to TA-CIN, a recombinant fusion protein vaccine comprising

L2/E6/E7 from HPV 16.

C. Xenova is willing to grant to CRT, and CRT is willing to accept, a licence

in the Field under the Xenova Patents and to use the Xenova Know-how and

Xenova Materials, all in accordance with the provisions of this Agreement.

IT IS AGREED AS FOLLOWS:

1 DEFINITIONS

In this Agreement, the following words shall have the following meanings:

AFFILIATE means in relation to a Party, any entity or person

that Controls, is Controlled by, or is under common

Control with that Party.

<PAGE>

ARISING INTELLECTUAL means any and all of the Arising Patents, Arising

PROPERTY Know-how and Arising Materials.

ARISING KNOW-HOW means technical, commercial and all other information

generated by CRT or its Affiliates or Sub-licensees

during the continuation of this Agreement which is

not publicly known that relates to any of the Xenova

Intellectual Property or any Licensed Product,

including any scientific or regulatory data, product

licence applications and approvals, clinical trial

licence applications and approvals, and development

and marketing plans and activities.

ARISING MATERIALS means any and all materials that may be generated or

developed by CRT or its Affiliates or Sub-licensees

in the course of this Agreement, including any

materials based on or derived from any Xenova

Materials.

ARISING PATENTS means any and all patents and patent applications

that may be applied for or obtained in respect of

any invention(s) made by CRT, its Affiliates or

Sub-licensees during the continuation of this

Agreement and which relate to any Xenova Intellectual

Property or any Licensed Product, together with any

continuations, continuations in part, extensions,

reissues, divisions, and any patents, supplementary

protection certificates and similar rights that are

based on or derive priority from the foregoing.

COMMENCEMENT DATE means the date of execution of this Agreement by the

Parties.

COMMERCIALISATION means an agreement to be entered into between CRT

AGREEMENT and a permitted Sub-licensee (subject to the

provisions of this Agreement, including Clause 2.3)

as contemplated by Clause 5.1.

CONFIDENTIAL INFORMATION means (a) all Know-How (including Arising Know-How),

(b) information relating to the Xenova Materials

and (c) information relating to the customers,

suppliers, business partners, clients, finances,

business plans, technical developments and products

(in each case actual or prospective) of a Party

which, in each case, is not publicly known and which

is acquired by the other Party pursuant to this

Agreement.

CONTROL means direct or indirect beneficial ownership of 50%

or more of the share capital, stock or other

participating interest carrying the right to vote or

to distribution of profits of that entity or person,

as the case may be; and "Controls" and "Controlled"

shall be interpreted accordingly.

CTM means finished product lot number 0864FP of TA-CIN

manufactured by Xenova and intended for use in

clinical trials

DEVELOPMENT AND means the Development and Commercialisation Plan for

Licensed

<PAGE>

COMMERCIALISATION PLAN Product summarised in the attached Schedule 4, as

amended from time to time by agreement in writing of

the Parties.

DEVELOPMENT AND means the report described in Clause 5.2 as amended

COMMERCIALISATION from time to time.

REPORT

DILIGENT AND REASONABLE means exerting such efforts and employing such

CRT EFFORTS resources as would normally be exerted or employed

by a reasonable third party company of similar size

to CRT for a product of similar market potential at

a similar stage of its product life, when utilizing

sound and reasonable scientific, business and medical

practice and judgment in order to appoint a

Sub-licensee in a timely manner who will undertake

to develop the product in a timely manner and

maximize the economic return to the Parties from

its commercialisation.

DILIGENT AND REASONABLE means exerting such efforts and employing such

SUB-LICENSEE EFFORTS resources as would normally be exerted or employed

by a reasonable third party company for a product of

similar market potential at a similar stage of its

product life, when utilizing sound and reasonable

scientific, business and medical practice and

judgment in order to develop the product in a timely

manner and maximize the economic return to the

Parties from its commercialisation.

DIRECT COSTS means:

(a) the Xenova Internal Costs;

(b) the CRT Filling Costs; and

maintaining, enforcing and defending and

commercialising the L2 Patents and the Xenova

Intellectual Property that consist of:

(i) official filing fees;

(ii) patent agent costs;

(iii) travel and out-of-pocket expenses;

(iv) courier charges and third party printing

costs;

(v) any non-recoverable taxes or charges

including value added tax which may be

imposed; and

(vi) any other similar, external costs and

expenses specifically associated with

commercialisation of the L2 patents

or/and the Xenova Intellectual Property,

excluding the costs of general partnering

conferences such as BIO.

FIELD means the prevention and treatment of HPV-related

diseases (including but not limited to vulval, anal

and cervical intraepithelial neoplasias and cervical

cancer) in humans.

<PAGE>

GROSS RECEIPTS means the amount of any payment (excluding Value

Added Tax), and the value of any non-monetary

receipt, obtained by, CRT or its Affiliate, in

relation to the commercialisation or sub-licensing

(including the grant of any option over a

sub-licence) of any Xenova Intellectual Property,

including any of the following:

(a) up-front, milestone (whether at the stage of

development, marketing or otherwise), success,

bonus, maintenance and periodic (including

annual) payments, royalty and minimum royalty

payments, due under any sub-licence agreement;

(b) payments in respect of the funding of research

or development activities related to any

Licensed Product, to the extent that such

payments exceed a fair market price for such

research or development;

cross-licensing arrangements, the value of any

third party licence obtained under such

arrangements;

(d) any premium paid over the fair market value of

shares, options or other securities in respect

of any of the share capital of CRT or its

Affiliate (such fair market value to be

determined on the assumption that Xenova

had not granted, nor agreed to grant, any

rights to CRT in respect of any Xenova

Intellectual Property);

(e) any loan, guarantee or other financial benefit

made or given other than on normal market

terms; and

(f) any shares, options or other securities

obtained from a third party.

HPV means Human Papilloma Virus

KNOW-HOW means the Xenova Know-how and the Arising Know-how.

L2 PATENTS means the patents and patent applications described

in the attached Schedule 2 and, in the case of the

patent applications, all patents arising therefrom

and all progeny applications arising from PCT

applications and patents arising therefrom and all

patent applications (and patents granted thereon)

which are related to those listed by the fact that

they are based on the same specification and/or

claim priority from the same fore-runner application

and/or as filed contain substantially the same

claims, together with any continuations,

continuations in part, extensions, reissues,

divisions, and any patents, supplementary protection

certificates and similar rights that are based on or

derive priority from the foregoing.

LICENSED PRODUCT means any product for use in the Field, that is

manufactured, sold or otherwise supplied by CRT or

its Affiliate or Sub-licensee and which (a) is

within any Valid Claim of the Xenova Patents and/or

(b) incorporates, or its development makes use of,

any of the Xenova Know-how or the Xenova Materials

(whether or not in combination with any third party

technology).

<PAGE>

MANCHESTER PHASE II A Phase II study meeting the description set out in

STUDY Schedule 5.

NET RECEIPTS means Gross Receipts less Direct Costs.

PARTIES means Xenova and CRT, and "Party" shall mean either

of them.

PATENTS means any and all of the Xenova Patents and the

Arising Patents.

QUARTER means each 3 month period ending on 31 March, 30

June, 30 September and 31 December.

SUB-LICENCE has the meaning given in Clause 2.3.

SUB-LICENSEE means any person with whom CRT has entered into a

Sub-licence, subject to the provisions of Clause 2.3.

TA-CIN means a recombinant protein vaccine that has been

developed by Xenova that is a fusion protein

comprising HPV 16 L2/E6/E7 proteins.

TERRITORY means the World.

TOBACCO PARTY means any corporation, company, partnership or other

organisation or person with a material interest in

or links to the tobacco industry (other than

interests held by investment firms as part of a

portfolio of investments).

VALID CLAIM means a claim of a patent or patent application that

has not expired, been withdrawn, abandoned or

surrendered or been refused, revoked or held invalid

or unenforceable by a court or other governmental

agency of competent jurisdiction in a final and

non-appealable judgment.

XENOVA INTELLECTUAL means any and all of the Xenova Patents, Xenova

PROPERTY Know-how and Xenova Materials.

XENOVA INTERNAL COSTS means internal costs incurred or to be incurred by

Xenova in relation to the filling and lot release of

CTM for the proposed Manchester Phase II Study up to

a total aggregate sum of [_].

XENOVA KNOW-HOW means technical information which is not publicly

known (including regulatory dossiers) in the

possession of Xenova in the Field relating to (a)

TA-CIN and/or (b) the inventions claimed in the

Xenova Patents, and being further described in the

attached Schedule 3.

XENOVA MATERIALS means physical materials (including cell banks and

CTM) in the possession of Xenova in the Field

relating to (a) TA-CIN and/or (b)

<PAGE>

the inventions claimed in the Xenova Patents, and

being further described in the attached Schedule 3.

XENOVA PATENTS means the patents and patent applications described

in the attached Schedule 1 and, in the case of the

patent applications, all patents arising therefrom

and all progeny applications arising from PCT

applications and patents arising therefrom and all

patent applications (and patents granted thereon)

which are related to those listed by the fact that

they are based on the same specification and/or claim

priority from the same fore-runner application

and/or as filed contain substantially the same

claims, together with any continuations,

continuations in part, extensions, reissues,

divisions, and any patents, supplementary protection

certificates and similar rights that are based on or

derive priority from the foregoing.

2. GRANT OF RIGHTS

2.1 Licences to Xenova Intellectual Property. Xenova hereby grants to CRT,

subject to the provisions of this Agreement:

(a) an exclusive licence in the Field under the Xenova Patents, with the right

to sub- license, subject to clause 2.3 below, to develop, manufacture,

have manufactured, use and sell Licensed Product in the Field in the

Territory; and

(b) an exclusive licence in the Field to use the Xenova Know-how and the

Xenova Materials, with the right to sub-license, subject to clause 2.3

below, to develop, manufacture, have manufactured, use and sell Licensed

Product in the Field in the Territory.

2.2 Formal licences. If requested by CRT, and at CRT's administrative cost,

the Parties shall execute such formal licences as may be necessary or

appropriate for registration with Patent Offices and other relevant

authorities in particular jurisdictions. In the event of any conflict in

meaning between any such licence and the provisions of this Agreement, the

provisions of this Agreement shall prevail. The Parties shall use

reasonable endeavours to ensure that, to the extent permitted by relevant

authorities, this Agreement shall not form part of any public record. To

the extent that Xenova Research Limited retains any right, title or

interest in the Xenova Patents it joins with Xenova in granting the rights

referred to in Clause 2.1 and undertakes to execute the formal licences

referred to in this Clause 2.2.

2.3 Sub-licensing. CRT shall be entitled to grant sub-licences (which for the

purposes of this clause shall include any option or right to acquire a

sub-licence) of its rights under this Agreement to any person (including

without limitation any Affiliate of CRT) ("Sub- licences), provided that:

(a) CRT shall (i) obtain Xenova's prior written consent (such consent

not to be unreasonably withheld or delayed) to the execution of a

term sheet, letter of intent or

<PAGE>

similar document ("Term Sheet") with the Sub-licensee, (ii) keep

Xenova regularly informed of the progress of negotiations with each

sub-licensee who has agreed a Term Sheet with CRT, and (iii) if it

is proposed that the sub-licence agreement shall survive termination

of this Agreement, obtain Xenova's prior written consent to the

terms of the sub-licence agreement and to CRT's execution of the

sub-licence agreement;

(b) the Sub-licence shall include obligations on the Sub-licensee which

are equivalent to the obligations on CRT under Clauses 3, 5.2, 6.6,

9.3 and 10 of this Agreement, as well as obligations on the

sub-licensee to use at least Diligent and Reasonable Sublicensee

Efforts to develop and commercialise Licensed Products, and CRT

shall ensure that the Sub-licence agreement provides that Xenova

may, in its own right, enforce all such obligations against the

Sub-licensee;

all Licensed Products marketed by it are of satisfactory quality and

comply with all applicable laws and regulations in each part of the

Territory relevant to such Sub-licence.

(d) the Sub-licence shall terminate automatically on the termination of

this Agreement for any reason (unless Xenova has given consent under

clause 2.3(a)(iii)); and

(e) within 30 days of the grant of any Sub-licence CRT shall provide to

Xenova a true copy of it.

2.4 Reservation of rights. For the avoidance of doubt, Xenova reserves the

right to use Xenova Intellectual Property in the Field for the purposes of

its own internal research only. It is understood and agreed that Xenova

will be required under regulatory GCP to retain archive samples of Xenova

Materials.

2.5 No other licence. It is acknowledged and agreed that except for the

licence(s) expressly granted by the provisions of this clause 2, Xenova

reserves all its rights. Without prejudice to the generality of the

foregoing Xenova reserves all rights under the Xenova Intellectual

Property outside the Field.

3 KNOW-HOW AND CONFIDENTIAL INFORMATION

3.1 Provision of Know-how. Within 30 days of the Commencement Date, Xenova

shall supply CRT or its Sub-licensee (if any) with the Xenova Know-how. In

addition, Xenova shall supply, in confidence, information in respect of

the Xenova Intellectual Property, as available and to the extent Xenova is

free to disclose it, to Sub-licensees or potential Sub-licensees of CRT as

CRT shall reasonably request and as is required by such Sub-licensees or

potential sub-licensees to decide whether to enter into or terminate any

Sub-licence. The Xenova Know-how shall be subject to the confidentiality

provisions of Clause 3.4. The method of such supply shall be as specified

in the Schedule 3, but shall not require Xenova to undertake more than 5

man-days work in respect of the obligation under this Clause 3.1 to

provide the Xenova Know-How to the University of Manchester and potential

Sub-licensees and more than 5 man-days work in respect of the obligation

under this Clause 3.1 to provide the Xenova Know-How to actual

Sub-licensees (ie a total

<PAGE>

maximum of 10 man-days) free of charge, unless otherwise agreed in writing

between the Parties

3.2 Status of Know-how and Materials. CRT acknowledges that the Xenova

Know-how and Xenova Materials are at an early stage of development.

Accordingly, specific results cannot be guaranteed and any results,

materials, information or other items, including the Xenova Know-how and

Xenova Materials and inventions claimed in the Xenova Patents provided

under this Agreement are provided "as is" and without any express or

implied warranties, representations or undertakings. As examples, but

without limiting the foregoing, Xenova does not give any warranty that

Xenova Materials are of merchantable or satisfactory quality, are fit for

any particular purpose, comply with any sample or description, or are

viable, uncontaminated, safe or non-toxic.

3.3 Use of Know-how. CRT undertakes that for a period of 10 years from the

date of first commercial sale of Licensed Product in the Territory or for

so long as any substantial part of the Xenova Know-how remains subject to

the obligations of confidence of Clause 3.4, whichever is the shorter, it

will not use the Xenova Know-how for any purpose except as expressly

licensed hereby and in accordance with the provisions of this Agreement,

including, but not limited to clause 8 hereof.

3.4 Confidentiality obligations. Each Party ("Receiving Party") undertakes:

(a) save as permitted by this Agreement to maintain as secret and

confidential Confidential Information obtained directly or

indirectly from the other Party ("Disclosing Party") in the course

of or in anticipation of this Agreement and to respect the

Disclosing Party's rights therein,

(b) to use the same exclusively for the purposes of this Agreement, and

customers, potential customers, potential Sub-licensees and

Sub-licensees pursuant to this Agreement (if any) to whom and to the

extent that such disclosure is reasonably necessary for the purposes

of this Agreement.

3.5 Exceptions to obligations. The provisions of Clause 3.4 shall not apply to

Confidential Information which the Receiving Party can demonstrate by

reasonable, written evidence:

(a) was, prior to its receipt by the Receiving Party from the Disclosing

Party, in the possession of the Receiving Party and at its free

disposal;

(b) is subsequently disclosed to the Receiving Party without any

obligations of confidence by a third party who has not derived it

directly or indirectly from the Disclosing Party;

default of the Receiving Party or its agents, employees, Affiliates

or sub-licencees; or

(d) in the case of Know-how, it has independently developed

<PAGE>

3.6 Disclosure to court, etc. If the Receiving Party is required to disclose

Confidential Information to the courts of any competent jurisdiction, or

to any government regulatory agency or financial authority, such

disclosure shall not be a breach of this clause 3, provided that the

Receiving Party shall (i) inform the Disclosing Party as soon as is

reasonably practicable, and (ii) at the Disclosing Party's request seek to

persuade the court, agency or authority to have the information treated in

a confidential manner, where this is possible under the court, agency or

authority's procedures.

3.7 Disclosure to employees. The Receiving Party shall procure that all of its

employees, contractors, consultants, advisers, customers, potential

customers, potential sub-licensees and sub-licensees pursuant to this

Agreement (if any) who have access to any of the Disclosing Party's

Confidential Information to which Clause 3.4 applies, shall be made aware

of and subject to these obligations and shall have entered into written

undertakings of confidentiality at least as restrictive as Clauses 3.4 and

which apply to the Disclosing Party's information.

4 MATERIALS

4.1 Supply of materials. Xenova shall supply the Xenova Materials or any of

them, including CTM, to CRT (or CRT's nominee) in such quantities as CRT

may reasonably request, within 30 days of such request. All such CTM

supplied by Xenova under or in connection with this Agreement shall remain

the absolute property of Xenova. For the avoidance of doubt, where Xenova

Materials ot

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