DEVELOPMENT AND LICENSE AGREEMENT

Exhibit 10.56

Portions of this exhibit marked [*] are requested to be treated confidentially.

DEVELOPMENT AND LICENSE AGREEMENT

By and Between

DEBIOVISION INC.

and

SALIX PHARMACEUTICALS, INC.

September 5, 2006

TABLE OF CONTENTS

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DEVELOPMENT AND LICENSE AGREEMENT

This Development and License Agreement, dated the 5 ^th day of September, 2006 (the “ Effective Date ”), is by and between SALIX PHARMACEUTICALS, INC. , a corporation organized and existing under the laws of California, USA and having its place of business at 1700 Perimeter Park Drive, Morrisville, NC 27560-8404 U.S.A. (“ Salix ”), and DEBIOVISION INC ., a company organized and existing under the laws of Quebec and having its place of business at 666 Sherbrooke Street West, Suite 1400, Montreal, Quebec H3A 1E7, Canada (“ Debiovision ”).

RECITALS

WHEREAS Debiovision is the owner of all rights, title and interest in the Technology and Intellectual Property throughout the world, including in the Territory (as such terms are hereinafter defined);

WHEREAS Debiovision has developed commercial and scientific experience relating to the Technology and to a product developed from the Technology, the Sanvar Product (as hereinafter defined);

WHEREAS Debiovision has filed the Existing NDA and has received the Orphan Drug Designation (as such terms are hereinafter defined) in respect of the Sanvar Product;

WHEREAS Salix possesses capabilities in the development and Commercialization of pharmaceutical products and wishes to obtain from Debiovision a license to use the Technology and the Intellectual Property to further develop, to manufacture and to Commercialize the Products in the Territory (as such terms are hereinafter defined).

NOW, THEREFORE , in consideration of the premises and of the mutual covenants and undertakings hereinafter set forth, the Parties hereto have agreed and do hereby agree as follows:

1. DEFINITIONS

When used in this Agreement, each of the following terms with initial capital letters, shall have the meanings set forth in this Section 1:

1.1 “ Additional Indications ” means any indication for a Product, excluding in respect of the Sanvar Product only the EVB Indication, but including but not limited to an upper gastro intestinal bleeding indication.

1.2 “ Affiliate(s) ” means, with respect to a Person, any Person that controls, is controlled by or is under common control of such first Person. For the purposes of this definition only, “control” means (a) to possess, directly or indirectly, the power to direct the management or policies of a Person, whether through ownership of voting securities or by contract relating to voting rights or corporate governance; or (b) to own, directly or indirectly, more than fifty percent (50%) of the outstanding voting securities or other ownership interest of a Person.

1.3 “ Agreement ” means this Development and License Agreement, including any and all schedules, as it may be amended from time to time, in accordance with its terms.

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1.4 “ API ” means the active pharmaceutical ingredient contained in the Sanvar Product, being vapreotide acetate, manufactured in accordance with the Specifications.

1.5 “ Approvable Letter ” means the approvable letter dated December 21, 2004 from the FDA to Debiovision in respect of the Existing NDA.

1.6 “ Approved Manufacturer ” means, as the case may be, either the current and/or future FDA approved manufacturer for the API or the current and/or future FDA approved manufacturer for the Sanvar Product, appointed and approved in accordance with Section 9.

1.7 “ Business Day ” means a day from 9:00 am to 5:00 pm local time on a day other than a Saturday, Sunday or bank or other public holiday in the United States of America or Canada.

1.8 “ Claimed ” means in respect of any product, material or formulation that it is within a Valid Claim of any Patent Rights.

1.9 “ Clinical Development ” means any Clinical Study managed by Salix which may be necessary or required by the Regulatory Authority of the Territory in order to obtain or maintain Regulatory Approval of a Product for any Indication in the Territory.

1.10 “ Clinical Study ” means any clinical study carried out by or on behalf of Salix during the Initial Term (i) relating to the Sanvar Product post NDA Approval Date, including, without limitation, any study carried out in order to obtain a label extension to the Sanvar Product; (ii) in connection with any NDA for any Product in the Territory; or (iii) as part of any Lifecycle Management Plan for any Product.

1.11 “ Combination Product ” means any Product which comprises the Technology in combination with one or more other active ingredients, identified by either Party during the Initial Term.

1.12 “ Commercialization ”, “ Commercializing ”, or “ Commercialize ” means all activities relating to the advertising, promotion and other marketing, pricing and reimbursement, Detailing, distribution, storage, handling, offering for sale and selling, customer service and support of a Product.

1.13 “ Commercialization Plan ” means the plan to be submitted to Debiovision and agreed by the JSC and all related annual updated versions, under which Salix commits to Commercialize the Sanvar Product with planned minimum resource requirements for the Territory and subsequently, commits to commercialise any New Product or Combination Product. The Commercialization Plan shall include (i) Salix Commitment (including minimum promotional and marketing budget and expenditures); (ii) anticipated Launch dates; (iii) anticipated market share; and (iv) Sales Forecasts.

1.14 “ Competing Product ” means any human pharmaceutical product that is not a Prohibited Product, that (i) contains the same active ingredient(s) as that/those contained in the Sanvar Product; or (ii) that contains or is a vasoactive agent; and is a substitute for or directly competitive with the Sanvar Product in the Territory, and for the avoidance of doubt, a Generic (other than a Salix Generic) may be a Competing Product.

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1.15 “ Co-Promoting ”, “ Co-Promotion ” or “ Co-Promote ” means activities that Salix and a Co-Promoting Entity are undertaking to market and promote, in collaboration, the Products in the Territory.

1.16 “ Co-Promoting Entity ” means a Third-Party that Co-Promotes Products.

1.17 “ Confidential Information ” means any and all proprietary, scientific, technical, trade secret, financial or business information of a Party (the “ Disclosing Party ”) which is disclosed orally, in writing or in any other form by the Disclosing Party to the other (the “ Receiving Party ”) or otherwise obtained by a Receiving Party, including without limitation, any data, document, manual, report, protocol, method, strategy, system, technique, process, sample, trade secret, business idea, concept, technology, analysis, data, clinical data, bidding document, list of actual or potential customers or partners, business or marketing plan, regulatory affairs information, Know-How or information relating to the Intellectual Property Rights of the Disclosing Party, under or in connection with this Agreement whether before or after the Effective Date.

1.18 “ Cost of Goods ” means the price per Unit of Sanvar Product invoiced by the Approved Manufacturer to Salix based on scaled batches of at least [*] Units and if not included therein, the price of API used therein as invoiced by the Approved Manufacturer to Salix net of:

1.19 “ Debiovision ” means Debiovision Inc., as set forth in the first paragraph of this Agreement.

1.20 “ Debiovision Information ” means any and all proprietary data, Intellectual Property Rights, quality module, chemistry, manufacturing and control information, clinical data, Know-How in whatsoever form and in their original language, developed by and proprietary to Debiovision or within the possession or control of Debiovision or any Debiovision Affiliate and relating to the Technology, any Product or any Debiovision Improvement at any time during the Initial Term, which shall include the Existing NDA, the Orphan Drug Designation, regulatory documentation, clinical efficacy and safety, development, synthesis which Debiovision has filed, developed or acquired or may hereafter file, develop or acquire at any time during the Initial Term.

1.21 “ Debiovision Patent Rights ” means the US patent listed on Schedule 1.21 and all Patent

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Rights of Debiovision or of any Debiovision Affiliate, or Patent Rights of a Debiovision licensee to which Debiovision has rights in respect of the Territory, at any time during the Initial Term, existing in the Territory. Schedule 1.21 shall be periodically amended to include any additional Debiovision Patent Rights that may arise during the Initial Term.

1.22 “ Deduction ” shall be as defined in Section 1.55.

1.23 “ Detail ” (including such variations as “ Detailing ”) means contact between a field sales force representative and a medical professional with prescribing authority for the purpose of discussing scientific or medical information about a pharmaceutical product(s).

1.24 “ Development ” means any activity relating to the development of a pharmaceutical product, including pre clinical testing, toxicology, formulation or clinical studies.

1.25 “ Disclosing Party ” shall have the meaning set forth in Section 1.17.

1.26 “ Due Diligence ” means, with respect to Commercialization of a Product, the application of commercially reasonable efforts, expertise and resources normally used by companies in the pharmaceutical industry to develop, distribute and Commercialize a product or to which they have rights, which is of similar market potential.

1.27 “ Effective Date ” shall have the meaning set forth in the first paragraph of this Agreement.

1.28 “ EVB Indication ” means the indication for the treatment of esophageal variceal bleeding in humans.

1.29 “ Existing NDA ” means the NDA filed with the FDA by Debiovision and numbered 21- 761, seeking Regulatory Approval of the Sanvar Product in the Territory for the EVB Indication.

1.30 “ FDA ” means the United States Food and Drug Administration or any successor or replacement entity thereof, a Regulatory Authority in the Territory.

1.31 “ Generic ” means on a Product by Product basis, a human pharmaceutical product which under the requirements of an applicable Regulatory Authority is deemed therapeutically equivalent and interchangeable with such Product, irrespective of its form or strength.

1.32 “Good Clinical Practice” or “GCP” means the clinical practice as set out in (i) ICH-GCP; (ii) the US Code of Federal Regulations Title 21, Parts 50 (Protection of Human Subjects), 56 (Institutional Review Boards) and 312 (Investigational New Drug Applications), as may be amended from time to time; and (iii) the Declaration of Helsinki as last amended at the 52 ^nd World Medical Association in October 2000, as amended from time to time.

1.33 “ Good Industry Practice ” means in relation to any undertaking and any circumstance, the exercise of that degree of skill, diligence, prudence and foresight which would reasonably and ordinarily be expected from a skilled and experienced person engaged in the same type of undertaking under the same or similar circumstances.

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1.34 “ Good Manufacturing Practice ” or “ GMP ” means the manufacture in accordance with (i) the current principles and guidelines of good manufacturing practice for medicinal products for human use and “substantial conformity with good manufacturing requirements” (as such phrase is used in Section 802(f)(1) of the U.S. Federal Food, Drug, and Cosmetic Act, as such Act may be amended from time to time); and (ii) US Code of Federal Regulations, Title 21, Part 210 (Current Food Manufacturing Practice in Manufacturing, Processing, Packaging or Holding of Drugs), Part 211 (Current Food Manufacturing Practice for Finished Pharmaceuticals).

1.35 “ ICH-GCP ” means the ICH Harmonised Tripartite Guideline for Good Clinical Practice (CPMP/ICH/135/95).

1.36 “ Improvements ” means any and all changes, modifications, improvements, enhancements, inventions, discoveries, whether or not patentable, relevant to the development, manufacture or Commercialization or use or sale of the Technology or a Product in the Territory, including, but not limited to Combination Products, Additional Indications, label extensions and New Formulations within the possession or control of a Party or any Affiliate of a Party at any time during the Initial Term. SR Formulation shall not be classified as an Improvement. Any improvement of Debiovision or its Affiliates shall be a Debiovision Improvement and any Improvement of Salix or its Affiliates shall be a Salix Improvement .

1.37 “ Indemnified Party ” shall have the meaning set forth in Section 13.1.

1.38 “ Indemnifying Party ” shall have the meaning set forth in Section 13.1.

1.39 “ Indication ” means any one of the EVB Indication or any Additional Indications.

1.40 “Initial Term” means the Sanvar Royalty Term plus an additional period of 36 months after the expiry of the Sanvar Royalty Term.

1.41 “ Intellectual Property ” means any and all proprietary information or subject matter including without limitation, Know-How, Intellectual Property Rights, Debiovision Patent Rights, Debiovision Information, data, analysis, reports, results, products, material, compounds, apparatus, methods, compositions, formulas, designs, specifications, drawings, computer programs or code, derivative works, processes or any other Intellectual Property Rights or proprietary rights, whether or not patentable or copyrightable within the possession or control of Debiovision or any Debiovision Affiliate at any time during the Initial Term related to the Technology, the API, any Product and/or any Debiovision Improvement.

1.42 “ Intellectual Property Rights ” means any intellectual property right that is or may be granted or recognised under any American or foreign legislation in any part of the world including Patent Rights, copyrights, moral rights, trade-marks, trade names, service marks, industrial designs, proprietary information, and rights in Know-How, trade secrets and any other statutory provision or common or civil law principle regarding intellectual and industrial property, whether registered or unregistered, and including rights in any application for any of the foregoing.

1.43 “ IR Formulation ” shall have the meaning set forth in Section 1.88.

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1.44 “ Joint Steering Committee ” or “ JSC ” means the committee to be established between the Parties pursuant to Section 6.

1.45 “ Know-How ” means all know-how, trade secrets, invention, information, instructions, processes, procedures, methods, formulas, opinions, discoveries, or data owned or in the possession or control of a Party or any Affiliate of such Party, related to the Technology, the API, or any Product or any Improvement, whether proprietary or not, including without limitation data generated in pre-clinical and clinical studies, clinical trial design, information contained in regulatory filings, manufacturing data, quality control, all biological, chemical, pharmacological, toxicological, pharmaceutical, physical and analytical, safety, quality control and information relating to the development, manufacturing, registration, or Commercialization of a Product and which is necessary or useful for the development, manufacture, use or exploitation of a Product.

1.46 “ Label ”, “ Labelled ” or “ Labelling ” means all labels and other written, printed or graphic matter upon (i)  a Product or any container or wrapper utilized with a Product, or (ii) any written material accompanying a Product, including, without limitation, package inserts and patient information leaflets.

1.47 “ Launch ” means the first invoiced commercial sale of a Product by Salix or a Salix Affiliate after obtaining Regulatory Approval in the Territory for such Product.

1.48 “ License ” shall have the meaning set forth in Section 2.1 hereof.

1.49 “ Lifecycle Management Plan ” means (i) the plan for further development in the Territory of the Sanvar Product, an outline of which will be proposed by Salix to the JSC within 90 days of the Effective Date, and the detail of which will be determined by the JSC under the provisions of Section 6 from time to time; and (ii) any such plan subsequently proposed and agreed by the JSC in respect of any subsequent Product.

1.50 “ Manufacturing Agreement(s) ” means any manufacturing agreement (including any safety and quality agreement related thereto) between Salix and an Approved Manufacturer related to the manufacture and supply of API and/or Sanvar Product, fully in accordance with the Specification(s).

1.51 “ Minimum Payments ” shall have the meaning set forth in Section 3.

1.52 “ NDA ” means a New Drug Application as defined in the U.S. Federal Food, Drug, and Cosmetic Act and the regulations promulgated thereunder (21 U.S.C. s355) filed with the FDA.

1.53 “ NDA Approval ” means the approval by the FDA of the Existing NDA.

1.54 “ NDA Approval Date ” means the date of the NDA Approval.

1.55 “ Net Sales ” means the Sales less the following items to the extent that they are paid or actually allowed (each a Deduction ):

(a) trade, quantity, and cash discounts or rebates actually allowed and taken, provided that

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such discounts or rebates are not applied disproportionately to the Product as compared with other similar products of the selling entity, including, without limitation, those granted on account of price adjustments, billing errors and recall returns. For clarity this includes trade, quantity and cash discounts or rebates actually allowed and taken by buying groups, healthcare insurance companies, pharmacy benefit management companies, health maintenance organisations or other institutions or health care organisations but does not include any discount or rebate for rejected goods or damaged goods;

(b) any tax, tariff, customs duties, excise or other duties or other governmental charge (other than an income tax) levied on the sale, transportation or delivery of the Product;

(c) freight, shipment and insurance costs incurred transporting Product to a Third Party purchaser; and

(d) payments or rebates reasonably and customarily paid in connection with sales of Product to any governmental or regulatory authority in respect of any state or federal Medicare, Medicaid or similar programs;

Provided that Deductions in respect of any Product shall not exceed:

The transfer of Product by Salix or one of its Affiliates to another Affiliate shall not be considered a sale. In such cases Net Sales shall be determined based on the invoiced sale price by the Affiliate, to the first Third Party trade purchaser, less the Deductions allowed under this Section 1.55.

Upon the sale or other disposal of Product other than in a bona fide arms length transaction exclusively for money or upon any use of Product for the purposes which do not result in a disposal of that Product in consideration of sales revenue customary in the Territory, such other sale, disposal or use shall be deemed to constitute a sale at the relevant open market price in the Territory, or, if that price is not ascertainable, a reasonable price assessed on an arm’s length basis for the goods or services provided in exchange for the supply. Disposal of Product for, or use of Product, in a Clinical Study or as free samples in quantities common in the industry for this sort of Product shall not give rise to any deemed sale under this Section.

1.56 “ Net Sales Royalty ” means a percentage royalty payable on Net Sales, in accordance with Section 4.1.

1.57 “ New Product ” means any Product other than the Sanvar Product or the SR Formulation, or a Salix Generic or a Combination Product, which is a New Formulation or otherwise uses the Technology or is in any Additional Indication identified by either Party after the Effective Date.

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1.58 “ New Formulation ” means any formulations which contain the Technology as an active ingredient, other than the IR Formulation or the SR Formulation.

1.59 “ Orphan Drug Designation ” means the FDA orphan drug designation dated January 10, 2000 received by Debiovision for the EVB Indication.

1.60 “Orphan Drug Exclusivity Term” shall be as defined in Section 2.9.

1.61 “ Package ”, “ Packaged ” and “ Packaging ” means all primary and secondary packaging components, including, without limitation, cartons, partitions, shippers, or any other like matter used in packaging any Products.

1.62 “ Party ” means Salix or Debiovision; “ Parties ,” means Salix and Debiovision.

1.63 “ Patent Rights ” means all patents and patent applications, utility certificates, improvement patents and models and certificates of addition Claiming any part of the Technology, the API, or any Product, including any divisional applications and patents, refilings, renewals, re-examinations, continuations, continuations-in-part, patents of addition, extensions, (including patent term extensions), reissues, substitutions, confirmations, registrations, revalidations, pipeline and administrative protections and additions, and any equivalents of the foregoing in any part of the World, as well as any supplementary protection certificates and equivalent protection rights in respect of any of them.

1.64 “ Person ” means any individual, corporation, company, cooperative, trust, business trust, association, partnership, joint venture, pool, syndicate, governmental authority, firm or other form of entity not specifically listed herein.

1.65 “ Prime Rate ” means the prime rate of interest published from time to time by the National Bank of Canada, expressed on an annual basis and recognised by such Bank as being the prime rate in force and announced on the date a payment is due, the whole in conformity with standard banking practices in accordance with the Bank Act (Canada).

1.66 “ Product ” means any product that incorporates any material part of the Technology, whether alone or in combination with any other active ingredient, including the Sanvar Product, any New Product and any Combination Product and, for the avoidance of doubt, any Salix Generic provided that Product expressly excludes the SR Formulation.

1.67 “ Prohibited Product ” means any human pharmaceutical product that [*] or [*] or [*], including, but not limited to, [*] or [*].

1.68 “ Promotional Material ” shall have the meaning set forth in Section 8.5.

1.69 “ Proprietary Data ” shall have the meaning set forth in Section 7.4.

1.70 “ Quarter ” means each period of three months ending on 31 March, 30 June, 30 September or 31 December, and “ Quarterly ” shall be construed accordingly.

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1.71 “Quarterly Reports ” means written Net Sales and Unit Royalty reports delivered under Section 4.7.

1.72 “ Receiving Party ” shall have the meaning set forth in Section 1.17.

1.73 “ Regulatory Approval ” means an approval granted from a relevant Regulatory Authority to market and sell a pharmaceutical product in any part of the Territory.

1.74 “ Regulatory Authority ” means any federal, national, state or local governmental authority, court, commission, regulatory, administrative or other agency, department, political or other subdivision, or instrumentality, or branch of any of the foregoing which regulates the development, manufacture, marketing, promotion, pricing, reimbursement and or sale of pharmaceutical products in the Territory and is involved in the granting of a Regulatory Approval.

1.75 “ Right of First Negotiation ” shall have the meaning set forth in Section 2.6.

1.76 “ Royalty ” means either of or both the Unit Royalty and/or the Net Sales Royalty set forth in Sections 4.1.2, 4.1.3, 4.1.4 and 4.1.5.

1.77 “ Royalty Term ” means on a Product by Product basis the period in which Royalties shall be due and payable in respect of such Product, which shall be for whichever shall be the longer of the period from the Launch date of the Product to (i) the date of expiry of a period of [*] years thereafter; and (ii) the date of expiry of the last to expire of any Debiovision Patent Rights Claiming the Product.

1.78 “ SAE ” shall have the meaning defined in the GCP.

1.79 “ Sales ” means the gross amount received by Salix or its Affiliates, or any Third Party on their behalf, in respect to any Product sold or otherwise disposed of by Salix or its Affiliates in the Territory, before the application of any Deductions.

1.80 “ Sales Forecasts ” means the Salix forecasts of sales of the Sanvar Product as delivered by Salix to Debiovision in a Commercialization Plan.

1.81 “ Sales Price ” means the gross amount received by Salix or its Affiliates or any Third Party on their behalf in respect to a Sanvar Product (on a Product by Product basis) sold or otherwise disposed of by Salix or its Affiliates in the Territory before the application of Deductions, calculated per Unit of Sanvar Product, averaged over a Quarter.

1.82 “ Salix ” means Salix Pharmaceuticals, Inc., as set forth in the first paragraph of this Agreement.

1.83 “ Salix Commitment ” means (a) in respect of the Sanvar Product, the amount of costs to be incurred in the five (5) first years of the Initial Term by Salix, directly or indirectly in connection with the Sanvar Product in the Territory in relation to (i) educational and promotional activities; (ii) Detailing efforts; (iii) Commercialization efforts, and (iv) public relations, related thereto; and (b) subsequently in respect of any Product, the amount of such costs to be incurred in respect of such Product pre Launch and in the period of four years post Launch as set out in the Commercialization Plan for such Product.

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1.84 “ Salix Generic ” means any Generic introduced in the Territory either directly or indirectly by Salix or any Salix Affiliate.

1.85 “ Salix Information ” means any and all Proprietary Data, Intellectual Property Rights, quality module, chemistry, manufacturing and control information, in whatsoever form and in their original language, developed by and proprietary to Salix or within the possession or control of Salix or any Salix Affiliate and relating to the Technology, any Product or any Salix Improvement, which shall include any NDA, regulatory documentation, clinical efficacy and safety, development, synthesis which Salix has filed, developed or acquired or may hereafter file, develop or acquire at any time during the Initial Term.

1.86 “ Salix IP ” means all Salix Information and Salix Patent Rights.

1.87 “ Salix Patent Rights ” means all Patent Rights of Salix or any Salix Affiliate, at any time during the Initial Term, in the Territory or in any other part of the World, subject to Section 10.4.

1.88 “ Sanvar Product ” means the human pharmaceutical product utilising the Technology and the Intellectual Property, in its immediate release formulation (“ IR Formulation ”), as more particularly described in the Specification contained in the Existing NDA.

1.89 “ Sanvar Royalty Term ” means the period of [*] years from Launch of the Sanvar Product in the Territory.

1.90 “ Specifications ” means the procedures, test results, requirements, standards, and other data and documentation with respect to the manufacture of the API and associated raw materials, excipients and components and with respect to the manufacture of the Sanvar Product, all fully in accordance with the Existing NDA (as amended from time to time in accordance with the terms of this Agreement).

1.91 “ SR Formulation ” means any sustained, controlled or slow release formulation of the Technology proprietary to Debiovision and/or any Affiliate of Debiovision.

1.92 “ Summary of Product Characteristics ” means the summary of product characteristics for the Sanvar Product, as set out in Schedule 1.92.

1.93 “ Technology ” means vapreotide acetate, a pharmaceutical preparation for human and veterinary use containing a molecule claimed, produced, covered under or using, in whole and in part, the Intellectual Property.

1.94 “ Term ” shall have the meaning set forth in Section 14.1.

1.95 “ Territory ” means the USA and its territories.

1.96 “ Third-Party ” means any Person other than a Party or an Affiliate of a Party.

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1.97 “ Transition Period ” shall have the meaning set forth in Section 15.1(a).

1.98 “ Unit ” means one unit of any Product, a Unit to be determined by reference to the Regulatory Approval for such Product in the Territory.

1.99 “ Unit Royalty ” shall mean the royalty payable on each Unit of Sanvar Product under the terms of Section 4.1.2.

1.100 “ Unit Royalty Report ” shall have the meaning set forth in Section 4.6.

1.101 “ USA ” means the United States of America.

1.102 “ Valid Claim ” means i) any claim of an issued and unexpired Patent Right which has not been revoked or held unenforceable or invalid by a decision of a court or a government agency of competent jurisdiction, unappealable or unappealed within the time allowed for appeal, or which has not been disclaimed, denied or admitted to be invalid or unenforceable through reissue, disclaimer or otherwise; and ii) the pending claims under any patent application included within a Patent Right until they are rejected or considered unpatentable or invalid by a government agency of competent jurisdiction.

1.103 “Year” shall be as defined in Section 4.3.

2. DEBIOVISION LICENSE AND OPTION

2.1 Licenses . Subject to the terms and conditions set forth in this Agreement, with effect from the Effective Date, Debiovision hereby grants to Salix a sole and exclusive license under the Technology and the Intellectual Property to develop, register, make, manufacture, procure manufacturing, Package or procure Packaging and Commercialize:

throughout the Territory (the “ License ”).

2.2 Restrictions on Rights . Salix acknowledges and agrees that the License:

2.2.1 shall be personal to Salix, that is, without the right to sublicense or subcontract. Notwithstanding the foregoing, Salix may:

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and subject to the terms and conditions of this Agreement; and

2.2.2 shall not permit Salix to Commercialize the Technology or the Products outside the Territory and that Debiovision retains the exclusive right, directly or through Third Parties, to Commercialize the Technology and/or the Products outside the Territory.

2.3 Right to Co-Promote . Subject to Debiovision’s prior written approval, which shall not be unreasonably withheld or delayed, Salix shall have the right to Co-Promote the Sanvar Product and any subsequent Product, in the Territory by appointing a Co-Promoting Entity, provided that no such Co-Promoting arrangement shall have any effect on Salix’s performance of its obligations under this Agreement and provided further that the appointment of any such Co-Promoting Entity shall be on the following terms:

2.4 Exclusivity in the Territory . Subject to the terms and conditions set forth in this Agreement, Debiovision undertakes and agrees that during the Term , it will not appoint or have appointed any other distributor, reseller or other person to Commercialize the Technology, the Intellectual Property or any Product in the Territory or license any Third Party to use any part thereof in the Territory nor will it, directly or indirectly , supply Products to distributors, resellers or users located within the Territory. For the avoidance of doubt, nothing in this Agreement shall prevent Debiovision from contributing to or advertising in international journals or from attending and/or exhibiting at any international conference or events held in the Territory.

2.5 Rights of Debiovision . Notwithstanding the rights granted to Salix under Section 2.1, Salix hereby agrees that Debiovision reserves its rights, directly or through a Third Party, to develop, make, manufacture and use the API and the Products within the Territory for Commercialization outside the Territory only. Furthermore, Salix agrees that Debiovision reserves the right directly or through an Approved Manufacturer, to manufacture or have manufactured the API or the Sanvar Product in the Territory in such quantities required to satisfy demand therefor outside the Territory.

2.6 Right of First Negotiation . Debiovision hereby grants to Salix a right of first negotiation to:

2.6.1 an exclusive upfront, milestones and royalty bearing license for the Territory, to Commercialize the SR Formulation; and

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2.6.2 a Supply Agreement for the supply of SR Formulation, since the license shall not include the right to manufacture the SR Formulation which shall remain with Debiovision and its Affiliates

(the “ Right of First Negotiation ”).

The terms and conditions of such license and supply agreement shall be negotiated in good faith between the Parties. The Right of First Negotiation shall be exercisable at any time during the period of [*] calendar months commencing on the Effective Date by service of notice in writing by Salix to Debiovision. If after exercise of such option, notwithstanding such good faith negotiations, the Parties are unable to agree on the terms and conditions of the license and supply agreement within [*] days of the date of notice of exercise, Debiovision shall be free thereafter to grant rights in the SR Formulation in the Territory to a Third Party, provided that such Third Party terms are not materially more favourable to such Third Party than the terms previously offered to Salix in such good faith negotiations.

2.7 Disclosure and Transfer to Salix of Intellectual Property. Forthwith following the Effective Date and from time to time during the Initial Term Debiovision:

2.7.1 shall disclose and make available to Salix all Intellectual Property;

2.7.2 acknowledges that all Intellectual Property created, acquired or developed after the Effective Date and during the Initial Term is licensed to Salix under the terms of Clause 2.1; and

2.7.3 shall on request, to the extent legally possible give Salix full access to any regulatory dossier related to a Product filed outside the Territory in connection with Commercialisation of such Product by Salix in the Territory.

2.8 Prohibited Products. Unless otherwise agreed in writing by Debiovision during the Initial Term, Salix shall not directly or indirectly, whether as principal, agent, independent contractor, licensor, licensee, co-promoter, or in any other manner, distribute or sell any Prohibited Product either in or outside the Territory provided that this restriction shall not apply to any Prohibited Product in the course of development or on the market at the time of acquisition by Salix or a Salix Affiliate of a corporate or business entity where such Prohibited Product was part of the product portfolio of such company or business and in such circumstances the provisions of Section 2.9 shall apply as if such acquired Prohibited Product was a Competing Product.

2.9 Competing Product . If Salix either directly or indirectly, whether as principal, agent, independent contractor, licensor, licensee, co-promoter, or in any other manner, distributes or sells any Competing Product in the Territory at any time during the period in which the Orphan Drug Designation shall provide market exclusivity for the Sanvar Product in the Territory (“ the Orphan Drug Exclusivity Term ”) it shall ensure that the annual Salix Commitment in respect of the Sanvar Product shall continue for the remainder of the Orphan Drug Exclusivity Term, at the level of costs incurred in the Salix Commitment on average in the two years preceding such Salix involvement in the Competing Product.

2.10 Salix Generic. Salix shall be permitted (whether directly or indirectly) to Commercialize a Salix Generic provided that:

2.10.1 it will not effect Launch of such Salix Generic prior to the expiry of the Orphan Drug Exclusivity Term (but may effect pre Launch activities during the period of six months preceding such expiry);

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2.10.2 such Salix Generic shall be a Product for the purpose of calculating Sales of Products under Section 4.1.1;

2.10.3 it shall pay a royalty on any such Salix Generic for the Royalty Term in respect of the Sanvar Product in accordance with Section 4.1.5.

2.11 Additional Territory. If Salix so requires it may request an amendment to the definition of the Territory to include an additional territory or territories provided that any such request:

2.11.1 shall be in writing;

2.11.2 shall identify the Salix Affiliate or licensee in the additional territory which will effect Commercialization;

2.11.3 shall contain an initial Commercialization Plan for such territory; and

on receipt of any such request Debiovision shall commence negotiations with Salix. The Parties shall negotiate in good faith to set forth the particular terms and conditions of such amendment(s) to this Agreement as may be required to effect such amendment to the Territory and the addition of such other territory(ies).

3. SALIX LICENSE

3.1 Salix License . Forthwith following the Effective Date and from time to time during the Initial Term, Salix shall:

3.1.1 disclose to Debiovision all Salix IP in so far as the same may reasonably be considered to be of assistance to Debiovision in the global Commercialization of any Product; and

3.1.2 grant to Debiovision an irrevocable, royalty free, exclusive license, with the right to sub-license subject to Section 3.2, to use the Salix IP in connection with the development, registration, the making of, manufacturing and Commercialization of any Combination Product and/or up to three New Products in all countries outside the Territory; and

3.1.3 upon request, give Debiovision full access to any regulatory dossier related to any Product of Salix filed in the Territory under the terms of this Agreement for Commercialization of such Product by Debiovision or its licensee, outside the Territory.

3.2 Debiovision Affiliates and Licensees . In consideration of the rights granted by Salix to Debiovision or its licensees under Section 3.1, Debiovision during the Initial Term undertakes to use all reasonable endeavours to:

3.2.1 procure from any current licensee of Debiovision or any Debiovision Affiliate as at the Effective Date, of the Technology outside the Territory, rights for the benefit of Salix in the

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Territory to any Intellectual Property Rights and information created, generated or identified by such licensee, such that the same shall be Debiovision Information and Intellectual Property for all purposes under this Agreement; and

3.2.2 from time to time, in respect of any licensee of Debiovision or any Debiovision Affiliate who shall be granted rights in respect of the Technology outside the Territory after the Effective Date, procure for the benefit of Salix rights in the Territory to any Intellectual Property Rights and information created, generated or identified by such licensee, such that the same shall be Debiovision Information and Intellectual Property for all purposes under this Agreement;

Provided that if any such licensee does not grant to Debiovision, for the benefit of Salix, such reciprocal rights, Debiovision shall not sub-license any rights to the Salix IP under Section 3.1 to any such licensee and shall not itself use or exploit any such rights in the Salix IP in such licensee’s territory.

3.3 Right of First Refusal . Salix hereby grant to Debiovision a right of first refusal to manage Clinical Studies on behalf of Salix, upon terms and conditions to be agreed upon between the Parties.

3.4 Salix Development . Salix shall discuss with Debiovision the conduct of any Clinical Development in respect of any Life Cycle Management Plan and acknowledges and agrees that Debiovision may participate and contribute to the costs of any such Clinical Development on such terms as may be negotiated in good faith and agreed between the Parties at the start of any Clinical Development in respect of any Combination Product or New Product (such terms to include, as appropriate, the increase of any Net Sales Royalty in respect of any such Combination Product under Section 4.1.4, provided that such Net Sales Royalty shall not in any circumstances exceed [*]% of the Net Sales of such Combination Product).

4. CONSIDERATION

4.1 In consideration of the License, the Intellectual Property, the commercial and scientific experience developed and acquired so far by Debiovision and other rights granted to Salix hereunder, including the Technology and the Sanvar Product, regulatory filings, the transfer to Salix of the Existing NDA, the regulatory exclusivity rights based upon the Orphan Drug Designation, all clinical studies and Debiovision’s ongoing phase III study for Sanvar Product in the USA, Salix hereby agrees to pay Debiovision:

4.1.1 A non-refundable amount of US $14,000,000 payable during the Sanvar Royalty Term and in accordance with the following payment schedule:

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Provided that notwithstanding the foregoing payment schedule, at the end of the Sanvar Royalty Term, Salix shall have paid to Debiovision the total amount of US $14,000,000 and therefore any amount set forth in subsections (a) to (g) which shall have not been paid to Debiovision as at such date, shall become due at the end of the Sanvar Royalty Term, save only where the Sanvar Royalty Term shall have been terminated under Sections 14.4 or 14.5;

Provided that notwithstanding the above in the event that in any Quarter the Sales Price of the Sanvar Product in the Territory shall be equal to or less than US$[*] ([*] dollars) per Unit of Sanvar Product, in substitution for the Unit Royalty and the Net Sales Royalty set out above, Salix shall pay a Net Sales Royalty on all such Sanvar Product sold in such Quarter at the rate of [*]% ([*] per cent) of Net Sales provided that the Royalty payable to Debiovision in respect of the Sanvar Product shall not in any circumstances be less than US$[*] ([*] dollars) per Unit of Sanvar Product sold.

4.1.3 In respect of any Combination Product where such Combination Product has been disclosed to Salix after the Effective Date by Debiovision under Section 2.7 and information relating to such Combination Product is a Debiovision Improvement and/or subject to a Valid Claim of any Debiovision Patent Rights, a Royalty at the rate of [*]% ([*] percent) of Net Sales of such Combination Product for such Combination Product Royalty Term;

4.1.4 In respect of any Combination Product where such Combination Product has been disclosed by Salix to Debiovision under Section 3.1 and information relating to such Combination Product is a Salix Improvement and/or subject to a Valid Claim of any Salix Patent Rights, a Royalty at the rate of [*]% ([*] percent) of Net Sales of such Combination Product for such Combination Product Royalty Term.

4.1.5 In respect of any Salix Generic, a royalty at the rate of [*]% ([*] per cent) of Net Sales of such Salix Generic, for the Sanvar Product Royalty Term only.

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4.1.6 For the avoidance of doubt no Royalty shall be payable in respect of any New Product, provided that Sales of any Combination Product, any New Product or any Salix Generic and any Competing Product in accordance with the terms of Section 2.9, shall be included in the calculation of cumulative Sales of Products for the purposes of Section 4.1.1.

4.2 Adjustment of Sanvar Product Royalty. The Sanvar Product Royalty and the sums payable in respect thereof shall be adjusted as follows;

4.2.1 it is acknowledged and agreed that where Salix obtains supply of the Sanvar Product an