EXCLUSIVE LICENSE AGREEMENT

EXHIBIT 10.2

EXCLUSIVE LICENSE AGREEMENT

Table of Contents

EXCLUSIVE LICENSE AGREEMENT

This Exclusive License Agreement (“Agreement”) is entered into by and between THE BOARD OF REGENTS of THE UNIVERSITY OF TEXAS SYSTEM (hereinafter “BOARD”), a governing board established under the laws of the State of Texas, THE UNIVERSITY OF TEXAS SYSTEM CANCER CENTER (hereinafter “UTSCC”), a component institution of The University of Texas System (hereinafter “System”) and ARGUS PHARMACEUTICALS, INC. (hereinafter “LICENSEE”), a Delaware corporation, whose address is 2170 Buckthorne Place, Suite 350-A, The Woodlands, Texas 77380 and shall be effective as of the effective date as provided for hereinafter.

WITNESSETH :

WHEREAS, BOARD is the owner of the BOARD Patent Rights and BOARD Technical Information, as hereinafter defined, conceived, discovered, or reduced to practice by UTSCC; and

WHEREAS, LICENSEE is desirous of obtaining a world-wide non-assignable (except as expressly provided herein), royalty-bearing exclusive license, with the right to grant sublicenses, under the BOARD Patent Rights and BOARD Technical Information; and

WHEREAS, LICENSEE desires the right to use the names Board of Regents, The University of Texas System, M. D. Anderson Hospital and Tumor Institute, and The University of Texas System Cancer Center for the purposes set forth herein; and

WHEREAS, BOARD desires to grant LICENSEE such a world-wide exclusive license, and the right to use such names, under the following terms and conditions;

NOW, THEREFORE, in consideration of the foregoing, and the covenants and promises contained herein, the sufficiency of which are hereby acknowledged by the parties, BOARD, UTSCC and LICENSEE hereby agree as follows:

I.

DEFINITIONS

A. The term “Researchers/Inventors” when used herein shall mean Roman Perez-Soler, M.D., Waldemar Priebe, Ph.D., Reeta T. Mehta, Ph.D., Kapil Mehta, Ph.D. and/or Gabriel Lopez-Berestein, M.D.

B. The term “Licensed Subject Matter” shall mean liposomal encapsulated Nystatin and other liposomal encapsulated polyene antibiotics (except amphotericin B), liposomal encapsulated Anthracyclines, and liposomal encapsulated retinoids, together with any invention, discovery, know-how, process, procedure, method, protocol, formula, technique, software, design, drawing, data, devices,

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specifications, sketches or other technical information related thereto conceived, discovered, or reduced to practice by the Researchers/Inventors, as of the date hereof, irrespective of whether other persons jointly participate in such conception, discovery or reduction to practice, and Related Technology (as defined in Paragraph I.C. herein) to be conceived, discovered, or reduced to practice as the result of funding provided under LICENSEE’s sponsored research program, as provided in the Research and Development Contract (“R & D Contract”) between LICENSEE and UTSCC, attached hereto as Exhibit I and incorporated herein, and all processes, compositions, uses and Products resulting therefrom. The term “Licensed Subject Matter” shall include the patents, patent applications and areas of research listed on Schedule I which is attached to this Agreement and incorporated herein by reference for all purposes.

C. The term “Related Technology” when used herein shall mean any invention, discovery, know-how, trade secret, or technical information conceived, discovered, or reduced to practice as the result of funding under and during the term of the R & D Contract.

D. The term “BOARD Patent Rights”, when used herein, shall mean those United States and foreign patents and patent applications or prospective patent applications, which relate to the Licensed Subject Matter (as defined in Paragraph I. B. herein), any technology that is an infringement thereof (except as provided in Paragraph 5.5 of the R & D Contract), and Improvements (as defined in Paragraph I. L. herein) that are the subject of any patent or patent application, in which BOARD now has or in the future acquires any interest during the term of this Agreement or during the term and arising as a result of the R & D Contract.

E. The term “BOARD Technical Information”, when used herein, shall mean all Licensed Subject Matter and all Improvements that are not subsumed within the BOARD Patent Rights.

F. The term “Licensed Patented Product or Process”, when used herein, shall mean any product, apparatus, or process made, used, or marketed or sold in any country where such product, apparatus or process is covered by the claims of an issued patent or a pending patent application included within the BOARD Patent Rights, together with any product made by the use of any process in any country in which such process or apparatus is covered by the claims of an issued patent or a pending patent application included within the BOARD Patent Rights.

G. The term “Licensed Non-Patented Product or Process”, when used herein, shall mean any product, apparatus or process utilizing or relating to the Licensed Subject Matter which is manufactured, used, marketed or sold with the use of any BOARD Technical Information which does not utilize any BOARD Patent Rights, together with any product utilizing the Licensed Subject Matter which is manufactured by a process or apparatus which uses any BOARD Technical Information and which does not utilize any BOARD Patent Rights.

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H. The term “Process” when used herein shall mean and include the manufacturing and utilization of the Licensed Patented Products or Licensed Non-Patented Products for diagnostic or therapeutic purposes.

I. The term “Product” when used herein shall mean any Licensed Patented Product or Process, and/or any Licensed Non-Patented Product or Process, as said terms are defined herein.

J. The term “Net Sales”, when used herein, shall mean the amount received or collected by LICENSEE from commercial sales or other use or disposition for value (including any marketing fees paid to LICENSEE in connection with sales of Products, but not including proceeds received from the sale of marketing rights as described in Paragraph III.A.3 hereof), in bona fide arms-length transactions, less (i) cash, trade and/or quantity discounts, (ii) amounts repaid or credited by reason of rejections, defects or returns or because of retroactive price reductions, (iii) freight, transportation and freight insurance (iv) sales and use taxes and (v) other charges which, under generally accepted accounting principles, are deemed to be incidental to the sale.

K. The term “Subsidiary” shall mean a corporation, partnership, association, trust or other legal entity which owns, controls, is owned or controlled by, or is under common ownership or control of, a party to this Agreement. For purposes of this definition, “control” shall mean the ownership of such number of outstanding shares or other interests aggregating more than 50% of the ordinary voting power for the election of directors or the exercise of control of such entity.

L. The term “Improvement” where used herein means any change or modification to the Licensed Subject Matter, and any compositions, Products and uses resulting therefrom (together with all other patents and patent applications, including any division, continuation, continuation-in-part or reissue thereof, or substitute therefor and the patents that may issue from such changes or modifications), conceived, discovered, or reduced to practice, in whole or in part by the Researchers/Inventors, irrespective of whether other persons jointly participate in such conception, discovery or reduction to practice, to the extent that such change or modification relates to the Licensed Subject Matter.

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II.

GRANT OF RIGHTS

A. BOARD hereby grants to LICENSEE and its Subsidiaries, for the term of this Agreement (subject to the provisions of Paragraph VI.C. herein), an exclusive, world-wide license, including the right to grant sublicenses, under (1) the BOARD Patent Rights, (2) the BOARD Technical Information, excluding from (1) and (2) those Improvements first conceived after the termination of the R & D Contract, and (3) Related Technology, to manufacture, use, market and sell any Product throughout the United States of America, its territories and possessions and in all foreign countries.

B. UTSCC and BOARD hereby grant to LICENSEE a right of first refusal to an exclusive, world-wide, royalty bearing license for Improvements first conceived after the termination of the R & D Contract but before the termination of this Agreement, provided that the rights to such Improvements are not already owned by a third party. UTSCC and BOARD agree that they shall (1) refrain from disclosing such Improvements to third parties (except as provided in Article V herein) or entering into negotiations or agreements with third parties with regard to the disposition of an Improvement except as otherwise expressly permitted by this Agreement; and (2) give LICENSEE prompt written notice of any such Improvement, which notice shall specify all relevant technical and scientific information pertaining to the Improvement in sufficient detail to permit LICENSEE to reasonably assess its interest in the Improvement and UTSCC’s projected research funding requirements, if any (the “Improvement Notice”). If LICENSEE delivers notice to UTSCC of its interest in an Improvement (“Notice of Interest”) within 15 days after delivery of the Improvement Notice, LICENSEE and UTSCC shall undertake negotiations for the acquisition by LICENSEE of rights to such Improvement. If LICENSEE fails to deliver a timely Notice of Interest, or if UTSCC, Board and LICENSEE fail to enter into a written agreement within 60 days after delivery of the Notice of Interest or such additional time as may be agreed to by the parties, Board and UTSCC shall be free to consult with and license such Improvement to any other firm and LICENSEE shall have no further rights to the Improvement. BOARD and UTSCC shall not enter into any agreement with any other party unless such agreement is, overall, more favorable to UTSCC than the last offered by LICENSEE.

C. BOARD and UTSCC hereby grant to LICENSEE the right to use the names “Board of Regents, The University of Texas System”, “M. D. Anderson Hospital and Tumor Institute” and “The University of Texas System Cancer Center” (“Names”) to the extent necessary to enforce and protect LICENSEE’S rights under Board Patent Rights; and subject to the written approval of UTSCC and, where required, BOARD, to use the Names for such other purposes as UTSCC and BOARD shall permit and may, under law, allow ; provided however, that LICENSEE shall not be obligated to use such Names in any manner.

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D. BOARD and UTSCC hereby grant to LICENSEE the right of access to, during normal business hours, and the use of, all experimental or other data which relate in any manner to the BOARD Patent Rights or the BOARD Technical Information, including without limitation, all data which BOARD has provided to the United States Patent Office, the Food and Drug Administration (FDA) or any other state, federal, foreign or local regulatory authority which relate in any manner to the BOARD Patent Rights or the BOARD Technical Information, and BOARD and UTSCC agree that they will not use, or permit the use of, such information and data, nor do anything else which will adversely affect LICENSEE’S rights under this Agreement in any manner. BOARD and UTSCC shall cooperate fully with LICENSEE, at LICENSEE’S expense, in order to obtain the regulatory approval of any state, federal, foreign or local authority which now is or later becomes necessary to develop manufacture, use, market or sell any Product. Such cooperation shall include, but not be limited to, obtaining all necessary regulatory approvals which are now required, or may in the future be required to manufacture, use, market or sell any Product for use in any application thereof. BOARD and UTSCC shall execute any and all documents reasonably necessary to obtain such approvals upon request by LICENSEE. LICENSEE shall reimburse BOARD and UTSCC for any reasonable out-of-pocket costs, plus overhead not to exceed 50% of out-of-pocket costs, including attorneys’ fees, incurred by BOARD and UTSCC in connection with such cooperation. At such time as clinical trials are commenced, LICENSEE agrees that it will enter into an appropriate agreement with UTSCC regarding the conduct of such trials but LICENSEE shall not be required to conduct such trials at UTSCC.

E. UTSCC shall promptly provide LICENSEE and shall continue to provide LICENSEE, during the term of this Agreement, with all information relating to (i) pharmacological, toxicological or clinical data, (ii) synthetic, formulative, manufacturing or analytical data, and (iii) such other chemical, physical or biological data which UTSCC may now or in the future possess or control which relates in any manner to the Licensed Subject Matter or Improvements, except for that information made confidential by law or prior agreement.

F. The parties recognize that LICENSEE may encounter patents or other proprietary rights held by third parties which dominate activities covered by the BOARD Patent Rights or BOARD Technical Information, and that cross-licenses between the BOARD (or LICENSEE) and such third parties may be necessary in order to enable LICENSEE to exercise the rights granted under this Agreement. In that event, LICENSEE has the right to enter into cross-licensing agreements with third parties and to grant cross-licenses under any or all of the BOARD Patent Rights or BOARD Technical Information, provided:

1. BOARD and UTSCC are consulted beforehand and are reasonably satisfied that the third party does in fact hold a patent or own other proprietary rights that limits LICENSEE’s ability to exercise the rights granted herein.

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2. In BOARD’s and UTSCC’s reasonable judgement, the rights received by LICENSEE under such cross-licensing agreement cover only Licensed Patented Products or Processes or Licensed Non-Patented Products or Processes and are not directed to other products;

3. BOARD incurs no financial or legal liabilities under the cross-licensing;

4. Any money or the value of any equipment, including license issue fees (and not including proceeds from sale of marketing rights as described in Paragraph III.A.3.), received by LICENSEE in exchange for such cross-licensing is treated as Net Sales for Products.

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III.

ROYALTIES AND PAYMENTS

A. In consideration of the grant by BOARD to LICENSEE of this license, LICENSEE shall pay to UTSCC as follows:

1. For each Licensed Patented Product or Process, an earned royalty as set forth in the schedule below:

of the Net Sales made by LICENSEE or its Subsidiaries in all countries where a patent included within the BOARD Patent Rights issues, or a patent application included within the BOARD Patent Rights has been filed and is pending, with claims covering such Licensed Patented Product or Process, until the expiration or other termination of such patents or applications, or a determination of the invalidity or unenforceability thereof by a court of final jurisdiction or the determination that such patent will not issue.

For purposes of calculating royalties under the above schedule (under this Paragraph III.A.1. and the following Paragraph III.A.2.), and for reporting purposes hereunder, each separate therapeutic drug, regardless of application, shall be considered a single licensed Product or Process, and all non-therapeutic Products and Processes shall be considered in the aggregate as a single licensed Product or Process.

2. An earned royalty of one-half the rate described in Paragraph III.A.1., hereinabove, for the same schedule of Net Sales for each Licensed Non-Patented Product or Process by LICENSEE or its Subsidiaries during the term of this Agreement. Further, and except as provided in Paragraph III.A.4., if a Licensed Patented Product or Process becomes a Licensed Non-Patented Product or Process (e.g. upon abandonment of a previously pending patent application), the royalty basis shall include Net Sales of said Product or Process made when said Product or Process was a Licensed Patented Product or Process.

3. An earned royalty of forty percent (40%) of the royalty received by the LICENSEE or its Subsidiaries from their sublicensees hereunder, such royalty to be measured upon and based on the actual proceeds received by LICENSEE or its Subsidiaries under the sublicense agreement and not the total Net Sales generated by the marketing or distribution of the Products by the sublicensee. Such earned royalty shall be due for as long as LICENSEE or its Subsidiary is receiving from the sublicensee proceeds relating to the rights licensed hereunder, but not in excess of the duration of this Agreement.

In addition, in the event LICENSEE transfers or sells any of the marketing rights to any Product to a non-related corporation, firm, association, partnership, or other entity, the proceeds from such sale of marketing rights is hereby expressly

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excluded from the terms of this Article III, and no royalty payments shall be due thereon, provided, however, that income to LICENSEE derived from the sales of any Product by said entity, association, firm, partnership or corporation shall be subject to the royalty provided in this Paragraph III.A.3; and provided further, that the total royalty under Paragraphs III.A.1., III. A.2. and III.A.3. shall not in any event exceed that amount which would otherwise be due and payable under Paragraphs III.A.1. or III.A.2., as the case may be, had such royalties been paid on the ultimate sale of such Product in the marketplace.

4. In no event will LICENSEE be obligated to pay royalties under Paragraphs III.A.1., III.A.2. or III.A.3 simultaneously for Net Sales of any particular Product in any given country. A single royalty will be due on the sale of each Product by LICENSEE or its Subsidiaries, no matter how many items in the BOARD Patent Rights or BOARD Technical Information cover such Product. No royalty shall be due or payable on a Licensed Patented Product or Process after the BOARD Patent Rights covering said Licensed Patented Product or Process have expired.

5. Earned royalties in the amount set out in Paragraph III.A.2. shall accrue in each country only for the period that the LICENSEE is the exclusive commercial source in that country of a Licensed Non- Patented Product or Process. The term “exclusive commercial source” as used above shall mean that the LICENSEE is the sole commercial source of the Licensed Non-Patented Product or Process in that country and that there is no commercial product available in that country that is substantially equivalent in market acceptance, except as may otherwise be provided, brought about, or allowed by LICENSEE. If the LICENSEE believes that it is not the exclusive commercial source of a Licensed Non-Patented Product or Process in any designated country, then it shall also notify BOARD and provide reasonable evidence thereto. Within 45 days of receipt of said notice and evidence, BOARD shall notify the LICENSEE in writing of its acceptance or rejection of the evidence as to the existence of another commercial source. Upon acceptance by BOARD, the LICENSEE shall, as of said date of acceptance, no longer have any obligation to pay royalties on Net Sales in that country based on the amount set out in Paragraph III.A.2. herein. In such event, the amount set out in Paragraph III.A.2. shall be reduced to an amount equal to one-third (1/3) of the applicable amount, and LICENSEE shall pay such reduced royalty amount.

6. Except as provided in Paragraph VI. C., below, BOARD understands that, in order to successfully market Products and Processes covered by this Agreement, LICENSEE makes no warranty that it will market the Products or Processes covered by this Agreement or, if LICENSEE does market any of such Products or Processes, that they will be the exclusive means by which LICENSEE will participate in this field. All business decisions relating to use, manufacture, sale or marketing of Products covered under this Agreement will be within the sole discretion of LICENSEE.

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7. In the event that LICENSEE enters into a joint venture with another entity and utilizes the rights granted herein in combination with the technology of such entity or any of LICENSEE’s technology not subject to this Agreement, then Net Sales for purposes of calculating royalties as provided in Paragraphs III.A.1 or III.A.2. hereunder, as the case may be, shall be deemed to be LICENSEE’s income received from such joint venture that is derived from utilization of the rights granted herein.

8. Where a Product is not sold separately but is sold in combination with or as part of other products, the Net Sales of the Product so sold shall be calculated, for the purpose of computing royalties due, by applying to the total selling price of the combination or composite product a fractional multiplier having as its denominator the total selling price of the combined or co