NOTE PURCHASE AGREEMENT

Exhibit 10.1

NOTE PURCHASE AGREEMENT

by and between

PFIZER INC.

and

MONOGRAM BIOSCIENCES, INC.

Dated as of May 5, 2006

Table of Contents

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Table of Contents

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NOTE PURCHASE AGREEMENT

T HIS N OTE P URCHASE A GREEMENT (“ Agreement ”) is made as of May 5, 2006 (the “ Effective Date ”), by and between M ONOGRAM B IOSCIENCES , I NC ., a Delaware corporation with its principal place of business at 345 Oyster Point Boulevard, South San Francisco, California 94080 (the “ Company ”), and P FIZER I NC . , 235 East 42 ^nd Street, New York, NY 10017 (subject to Section 11.10(a), the “ Purchaser ”).

W HEREAS , the Company wishes to sell to the Purchaser, and Purchaser wishes to purchase from the Company, a 3% Senior Secured Convertible Note in the principal amount of $25,000,000 and in the form attached hereto as Exhibit A (the “ Note ”), on the terms and subject to the conditions set forth in this Agreement.

W HEREAS , immediately prior to the execution of this Agreement, the Company and Purchaser entered into a Collaboration Agreement (as such agreement may be amended from time to time, the “ Collaboration Agreement ”).

W HEREAS , in connection with issuing and selling the Note to the Purchaser, the Company and the Purchaser into a Security Agreement dated as of the Effective Date (as such agreement may be amended from time to time, the “ Security Agreement ” and together with the Note and this Agreement, the “ Transaction Documents ”).

A GREEMENT

In consideration of the mutual covenants contained in this Agreement, and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Company and the Purchaser hereby agree as follows:

1. A UTHORIZATION OF S ALE OF THE S ECURITIES ; S ALES OF A DDITIONAL S ECURITIES . Subject to the terms and conditions of this Agreement, the Company has authorized the sale and issuance of the Note and the shares of Common Stock issuable upon conversion thereof (collectively, the “ Securities ”).

2. A GREEMENT TO S ELL AND P URCHASE THE N OTE . Subject to the terms and conditions of this Agreement at the Closing (as defined below), the Company will sell to the Purchaser, and the Purchaser will purchase from the Company, the Note at a purchase price equal to 100% of the principal amount thereof, for a total purchase price of twenty-five million dollars (the “ Purchase Price ”). The Note executed and delivered at Closing and dated as of the date of the Closing shall (i) include a maturity date that is four years from the date of the Closing and (ii) include a conversion price that equals 120% of the average of the closing prices of the Company’s common stock (determined in accordance with the Note) for the five trading day period ending on the Business Day (as defined in the Note) immediately preceding the date of the Closing.

3. C LOSING AND D ELIVERY .

3.1 Closing. The closing of the purchase and sale of the Note pursuant to this Agreement (the “ Closing ”) shall be held at the offices of Debevoise & Plimpton LLP, 919 Third

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Avenue, New York, NY 10022 on the fourteenth day following the Effective Date (the “ Closing Date ”). At or prior to the Closing, the Purchaser and the Company shall execute any related agreements or other documents required to be executed and/or delivered hereunder, dated as of the Closing Date.

3.2 Delivery. At the Closing (i) the Purchaser shall deliver to the Company a check or wire transfer funds in the amount of the Purchase Price; and (ii) the Company shall issue and deliver to the Purchaser the Note.

4. R EPRESENTATIONS AND W ARRANTIES OF THE C OMPANY .

Except as set forth on the Schedule of Exceptions delivered to the Purchaser concurrently herewith, the Company hereby represents and warrants as of the date hereof and as of the Closing to the Purchaser as follows:

4.1 Organization and Good Standing. The Company has been duly incorporated and is validly existing as a corporation in good standing under the laws of the State of Delaware, has full corporate power and authority to own or lease its properties and conduct its business as described in the SEC Documents (as defined in Section 4.10 below), and is duly qualified as a foreign corporation and in good standing in all jurisdictions in which the character of the property owned or leased or the nature of the business transacted by it makes qualification necessary, except where the failure to be so qualified would not have a material adverse effect on the business, properties, financial condition or results of operations of the Company or to perform its obligations under any of the Transaction Documents (any of the foregoing, a “ material adverse effect ”).

4.2 Corporate Power; Authorization.

(a) The Company has all requisite corporate power, and has taken all requisite corporate action, to execute and deliver this Agreement, the other Transaction Documents, to sell and issue the Securities and carry out and perform all of its obligations under this Agreement and the other Transaction Documents. Each of Transaction Documents constitutes a legal, valid and binding obligation of the Company, enforceable in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or affecting the enforcement of creditors’ rights generally, (ii) as limited by equitable principles generally, including any specific performance, and (iii) in the case of this Agreement and the Collaboration Agreement, to the extent that the enforceability of those provisions relating to indemnity or contribution may be limited by applicable laws.

(b) Without limiting the generality of the foregoing, the board of directors of the Corporation have approved the transactions contemplated by the Transaction Documents for purposes of Section 203 of the Delaware General Corporation Law. No provision of Section 203 of the Delaware General Corporation Law or the articles of incorporation or bylaws of the Company would restrict or impair the ability of the Purchaser to vote, or otherwise to exercise the rights of a shareholder with respect to the shares of Common Stock acquired by Purchaser or one of its Subsidiaries (as defined in the Note) prior to the date hereof or that are part of the Securities.

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4.3 Compliance with Other Instruments. The execution, delivery and performance of and compliance with this Agreement and the other Transaction Documents and the issuance, sale and delivery of the Securities by the Company and any exercise of rights by the Purchaser thereunder will not conflict with or result in a breach or violation of the terms, conditions or provisions of, or result in any acceleration or loss of rights under (including upon the passage of time or notice or both) (a) the Certificate of Incorporation or Bylaws of the Company, (b) any statute, law, rule or regulation (including without limitation, the rules and regulations applicable to the Nasdaq Stock Market and applicable securities laws) applicable to the Company, (c) any state or federal order, judgment or decree applicable to the Company or (d) any indenture, mortgage, lease or other agreement or instrument to which the Company or any of its properties is subject, and, in the case of clauses (b), (c) or (d), where such breach or violation would have a material adverse effect or materially impair or limit the exercise of rights by the Purchaser granted under any of the Transaction Documents. The execution, delivery and performance of and compliance with this Agreement and the issuance, sale and delivery of the Securities by the Company will not require the approval of its stockholders, or result in the creation or imposition of any lien upon any of the properties or assets of the Company.

4.4 Valid Issuance. The Securities, when issued and paid for in compliance with the provisions of this Agreement (or, in the case of shares of Common Stock, upon any conversion of the Note), will be validly issued, fully paid and nonassessable and will not be issued in violation of any preemptive right that has not been effectively waived.

4.5 Indebtedness. Schedule 4.5 is a complete and correct list of each credit agreement, loan agreement, indenture, purchase agreement, guarantee, letter of credit or other arrangement providing for or otherwise relating to any Indebtedness of, or any extension of credit (or commitment for any extension of credit) to, or Guarantee by, the Company outstanding on the Effective Date, (A) the aggregate principal or face amount of which, for each such arrangement, equals or exceeds (or, based on credit commitments existing as of the date hereof, may equal or exceed) $50,000, or (B) which constitutes Permitted Lien Indebtedness (as defined in the Note), and the aggregate principal or face amount outstanding or that may become outstanding (based on credit commitments existing as of the date hereof) under each such arrangement as of the Effective Date is correctly described on Schedule 4.5.

4.6 Absence of Liabilities. Other than in connection with the transactions contemplated by this Agreement, neither the Company nor any of its subsidiaries has any liabilities (fixed or contingent, including without limitation any tax liabilities due or to become due), except those which (i) are fully reflected or provided for in the Financial Statements or (ii) were incurred in the ordinary course of business (and which remain outstanding), none of which would, individually or in the aggregate, have a material adverse effect.

4.7 Properties; Liens and Encumbrances. Except for Permitted Liens (as such term is defined in the Note), the Company owns all its material property and assets free and clear of any and all Liens (as defined in the Note), encumbrances and other security interests.

4.8 Subsidiaries. The Company has no Subsidiaries (as defined in the Note).

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4.9 Registration Rights. Except as provided for herein and as set forth in the SEC Documents, the Company is not under any obligation to register under the Securities Act any of its currently outstanding securities or any of its securities which may hereafter be issued. The Company is eligible to register Registrable Securities (as defined in Section 10) on a Registration Statement on Form S-3 in accordance with Section 10. No registration obligation disclosed in the SEC Documents would limit the exercise of the registration rights granted herein in the manner set forth herein.

4.10 SEC Documents; Financial Statements. The Company has filed in a timely manner all documents that the Company was required to file with the United States Securities and Exchange Commission (the “ SEC ”) under Sections 13, 14(a) and 15(d) of the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”), during the twelve (12) months preceding the Effective Date. As of their respective filing dates (or, if amended, when amended), all documents filed by the Company with the SEC (the “ SEC Documents ”) complied in all material respects with the requirements of the Exchange Act. None of the SEC Documents as of their respective dates contained any untrue statement of material fact or omitted to state a material fact required (under the federal securities laws in connection with the sale of the Securities) to be stated therein or necessary to make the statements made therein, in light of the circumstances under which they were made, not misleading. The financial statements (including the notes thereto) of the Company included in the SEC Documents (the “ Financial Statements ”) comply as to form and substance in all material respects with applicable accounting requirements and with the published rules and regulations of the SEC with respect thereto. The Financial Statements have been prepared in accordance with generally accepted accounting principles consistently applied and fairly present the financial position of the Company at the dates thereof and the results of its operations and cash flows for the periods then ended (subject, in the case of unaudited statements, to normal, recurring adjustments).

4.11 Intellectual Property. Except as set forth on Schedule 4.11 hereto, the Company owns or possesses adequate rights to use all material patents, patent rights, inventions, trade secrets and know-how that are necessary for the conduct of its business as presently conducted and as described in the SEC Documents. Except as set forth in the SEC Documents, the Company has not received any written notice of, nor has any knowledge of, any infringement of or conflict with asserted rights of others with respect to any patent, patent right, invention, trade secret or know-how that, individually or in the aggregate, if the subject of an unfavorable decision, ruling or finding, would have a material adverse effect.

4.12 Capitalization. The capitalization of the Company is as described in the Company’s Annual Report on Form 10-K for the year ended December 31, 2005 and subsequently filed SEC Documents. The Company has not issued any capital stock since December 31, 2005 other than pursuant to equity incentive and employee benefit plans, warrants and other convertible securities disclosed in the Company’s SEC Documents filed before the Effective Date. The outstanding shares of capital stock of the Company have been duly and validly issued and are fully paid and nonassessable and were not issued in violation of any preemptive rights not effectively waived. Except as set forth in or contemplated by the Company’s SEC Documents or as otherwise described in this Agreement, there are no outstanding rights (including, without limitation, preemptive rights), warrants or options to acquire, or instruments convertible into or exchangeable for, any unissued shares of capital stock

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or other equity interest in the Company, or any contract, commitment, agreement, understanding or arrangement of any kind to which the Company is a party and relating to the issuance or sale of any capital stock of the Company, any such convertible or exchangeable securities or any such rights, warrants or options.

4.13 Litigation. There is no pending or, to the Company’s knowledge, threatened, action, suit or other proceeding to which the Company is a party or to which its property or assets are subject that is not disclosed in the SEC Documents that is required to be so disclosed.

4.14 Governmental Consents. No consent, approval, order or authorization of, or registration, qualification, designation, declaration or filing with, any federal, state, or local governmental authority on the part of the Company is required in connection with the consummation of the transactions contemplated by the Transaction Documents except for compliance with the securities and blue sky laws in the states and other jurisdictions in which Securities are offered and/or sold, which compliance will be effected in accordance with such laws.

4.15 No Material Adverse Change. Except as otherwise disclosed herein, since December 31, 2005, there have not been any changes in the assets, liabilities, financial condition or operations of the Company from that reflected in the Company’s Form 10-K for the period ended December 31, 2005 except changes in the ordinary course of business or which have not been, either individually or in the aggregate, materially adverse.

4.16 Securities Violations. The Company represents and warrants that none of its directors or officers is or has within the last five years, been the subject of, or a defendant in: (i) an enforcement action or prosecution (or settlement in lieu thereof) brought by a governmental authority relating to a violation of securities, tax, fiduciary or criminal laws, or (ii) a civil action (or settlement in lieu thereof) brought by shareholders or investors in a common investment vehicle for violation of duties owed to the shareholders or investors.

4.17 Nasdaq. The Company’s Common Stock is listed on The Nasdaq National Market.

4.18 Offering Valid. Assuming the accuracy of the representations and warranties of the Purchaser contained in Section 5.1 hereof, the offer and issuance of the Securities will be exempt from the registration requirements of the Securities Act of 1933, as amended (the “ Securities Act ”), and will have been registered or qualified (or are exempt from registration and qualification) under the registration, permit or qualification requirements of all applicable state securities laws. Neither the Company nor any agent on its behalf has solicited or will solicit any offers to sell or has offered to sell or will offer to sell all or any part of the Securities to any person or persons so as to bring the sale of such Securities by the Company within the registration provisions of the Securities Act or any state securities laws.

4.19 Investment Company Act and Public Utility Holding Company Act. The Company is not (a) an “investment company” as defined in, or subject to regulation under, the Investment Company Act of 1940 or (b) a “holding company” as defined in, or subject to regulation under, the Public Utility Holding Company Act of 1935.

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5. R EPRESENTATIONS AND W ARRANTIES OF THE P URCHASER .

5.1 The Purchaser represents and warrants as of the date hereof and as of the Closing to the Company that:

(a) Without limiting any of the representations and warranties of the Company in any Transaction Document, the Purchaser, taking into account the personnel and resources it can practically bring to bear on the purchase of the Securities contemplated hereby, either alone or together with the advice of the Purchaser’s representative, is knowledgeable, sophisticated and experienced in making, and is qualified to make, decisions with respect to investments in securities presenting an investment decision like that involved in the purchase of the Securities, including investments in securities issued by the Company, and has requested, received, reviewed and considered, either alone or with the Purchaser’s representative, all information the Purchaser deems relevant (including the SEC Documents) in making an informed decision to purchase the Securities.

(b) The Purchaser is acquiring the Securities being acquired by the Purchaser pursuant to this Agreement for its own account for investment only and with no present intention of distributing any of such Securities or any arrangement or understanding with any other persons regarding the distribution of such Securities, except in compliance with Section 10.

(c) The Purchaser will not, directly or indirectly, offer, sell, pledge, transfer or otherwise dispose of (or solicit any offers to buy, purchase or otherwise acquire or take a pledge of) any of the Securities purchased hereunder except in compliance with the Securities Act, applicable blue sky laws, and the rules and regulations promulgated thereunder.

(d) The Purchaser is an “accredited investor” within the meaning of Rule 501 of Regulation D promulgated under the Securities Act.

(e) The Purchaser has full right, power, authority and capacity to enter into this Agreement and to consummate the transactions contemplated hereby and has taken all necessary action to authorize the execution, delivery and performance of this Agreement. Upon the execution and delivery of this Agreement by the Purchaser, this Agreement shall constitute a valid and binding obligation of the Purchaser, enforceable in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or affecting the enforcement of creditors’ rights generally, (ii) as limited by equitable principles generally, including any specific performance, and (iii) as to those provisions of Section 10.7 relating to indemnity or contribution.

5.2 The Purchaser represents and warrants to and covenants with the Company that it has not engaged in any short sales of the Company’s Common Stock within the three (3) month period prior to the Closing Date.

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5.3 The Purchaser understands that nothing in the SEC Documents, this Agreement or any other materials presented to the Purchaser in connection with the purchase and sale of the Securities constitutes legal, tax or investment advice rendered to the Purchaser and that independent legal counsel has reviewed these documents and materials on the Purchaser’s behalf. Without limiting any of the representations and warranties of the Company in any Transaction Document, the Purchaser has consulted such legal, tax and investment advisors as it, in its sole discretion, has deemed necessary or appropriate in connection with its purchase of the Securities.

6. S URVIVAL OF R EPRESENTATIONS , W ARRANTIES AND A GREEMENTS , D ISCLAIMER , I NDEMNIFICATION .

6.1 Survival. Notwithstanding any investigation made by any party to this Agreement, all representations and warranties made by the Company and the Purchaser herein and in the certificates for the securities delivered pursuant hereto shall survive the Closing. The representations and warranties shall expire on the earlier of (i) repayment in full of all outstanding amounts under the Note or (ii) conversion of all outstanding amounts under the Note pursuant to Section 6 of the Note. The covenants and agreements of the parties herein shall survive without expiration unless otherwise specified herein.

6.2 Disclaimer. EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT, NEITHER PARTY MAKES ANY REPRESENTATION OR WARRANTY TO THE OTHER PARTY OF ANY NATURE, EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF NONINFRINGEMENT, MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE.

6.3 Limitation of Liability. NEITHER PARTY SHALL BE ENTITLED TO RECOVER FROM THE OTHER PARTY ANY SPECIA