EX-10: LICENSE AND SUPPLY AGREEMENT

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EXHIBIT 10

C.I. = CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN THIS DOCUMENT HAS BEEN

OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION

PURSUANT TO RULE 24B-2 OF THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

SUPPLY AND LICENSE AGREEMENT

This Supply and License Agreement (hereinafter referred to as this "AGREEMENT")

is entered into by and among

DUSA Pharmaceuticals, Inc.,

a company duly organized and existing under the laws of New Jersey,

having its principal office at 25 Upton Drive, Wilmington,

Massachusetts 01887,

United States

- hereinafter referred to as "DUSA" -

medac Gesellschaft fur klinische Spezialpraparate mbH,

a company duly organised and existing under the laws of Germany,

having its registered office at Fehlandtstrasse 3, 20354 Hamburg, Germany

- hereinafter referred to as "MEDAC" -

photonamic GmbH & Co. KG,

a company duly organised and existing under the laws of Germany,

having its registered office at Fehlandtstrasse 3, 20354 Hamburg, Germany

- hereinafter referred to as "PHOTONAMIC" -

hereinafter individually and collectively referred to respectively as a "Party"

and the "Parties"

WHEREAS DUSA and MEDAC entered into a Supply Agreement dated December 30, 2002,

(the "Former Supply Agreement'"), which the Parties to wish to terminate and

supercede with this Agreement; and

WHEREAS contemporaneously with the execution of the Supply Agreement, DUSA and

PHOTONAMIC entered into a License and Development Agreement dated December 30,

2002 (the "License Agreement"), which the Parties wish to terminate, except as

provided in this Agreement; and

WHEREAS MEDAC directly or indirectly through a third party manufactures API, as

defined below; and

WHEREAS, DUSA is entitled to purchase the API from MEDAC under the terms and

conditions set forth in the Former Supply Agreement as superceded by this

AGREEMENT and MEDAC is willing to supply the API to DUSA on such terms and

conditions.

NOW, THEREFORE, in consideration of the mutual covenants and the premises

contained herein which the parties acknowledge as sufficient consideration for

this Agreement, the Parties hereto agree as follows:

1. DEFINITIONS

For the purpose of this AGREEMENT the following words and phrases shall have the

following meaning:

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1.1. "AFFILIATES" shall mean, with respect to any Party, any person,

corporation, company, partnership, joint venture, firm or other entity

which is controlled by, controls or is under direct or indirect common

control with such Party. For the purposes of this definition

"control" shall mean (a) in the case of corporate entities,

direct or indirect ownership of at least C.I. of the stock or shares

entitled to vote for the election of directors, or managing directors,

and (b) in the case of non-corporate entities, direct or indirect

ownership of at least C.I. of the equity interest with the power to

direct management and policies of such non-corporate entities.

1.2. "API" shall mean the active pharmaceutical ingredient 5-aminolevulinic

acid HCI, as more particularly described on Exhibit 1 hereto in oral

or intravenous formulations.

1.3. "CONFIDENTIAL INFORMATION" shall mean all documents, methods,

technical know-how and all other information that is non-public,

confidential and proprietary in nature disclosed by one Party to the

others or any of its directors, officers, employees, agents,

consultants or representatives relating to the business of the

disclosing Party or its AFFILIATES.

1.4. "EFFECTIVE DATE" shall mean date of the last Party to sign this

Agreement.

1.5. "FIELD" shall mean the fluorescence-guided resection of glioblastoma.

1.6. "TERRITORY' shall mean the following countries: United States, C.I..

2. TERMINATION

2.1. DUSA and MEDAC hereby agree to terminate the Former Supply Agreement

with immediate effect. Notwithstanding the language stated in the

previous sentence, pursuant to Section 11.6 of the Former Supply

Agreement, Section 1 (Definitions, as appropriate), Section 7.1

(Adverse Event Reporting), Section S (Confidentiality), Section 13.3

(Books and Records), Section 13.5.2 (English language), and Exhibit

1.26 (Specifications) shall survive such termination. Neither Party

shall have any ongoing rights and obligations under the Former Supply

Agreement except pursuant those sections stated in this Section 2.1.

2.2. DUSA and PHOTONAMIC hereby terminate the License Agreement with

immediate effect. Notwithstanding the language stated in the previous

sentence, pursuant to Section 13.6.2 of the License Agreement, DUSA

shall have the non-exclusive right to use the Licensed Technology

obtained under the License Agreementin the TERRITORY. For that purpose

Section 1 (Definitions, as appropriate)Section 2.2.1 (representation

of ownership), Section 6.2 second sentence (right to reference FDA

dossier), Sections 10.4-10.7 (regarding confidentiality), Sections

13.5.4 and 13.5.5 (rights to use the Licensed Technology, as defined

in the License Agreement, outside the Field within the Territory),

Section 15.3 (Books and Records), Exhibit 1.26 (Licensed Technology)

of the License Agreement shall survive termination.

By terminating the License Agreement, except as provided in this Agreement,

PHOTONAMIC shall have C.I., subject to the confidentiality provisions in

this Agreement.

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3. OBJECT OF AGREEMENT

3.1. DUSA hereby appoints MEDAC as a supplier of the API in the TERRITORY.

3.2. DUSA may use the API, from time to time, for manufacturing and

marketing a finished pharmaceutical product in its own name and at its

own risks.

4. FORECAST/ ORDERS /TERMS OF DELIVERY

4.1. DUSA shall advise MEDAC of its estimated needs of API for the

succeeding twelve (12) calendar months and will provide C.I. of its

forecast during the term. Unless expressly stated in this Agreement

C.I..

4.2. DUSA shall place its orders at least C.I. in advance of its requested

delivery date but the first order shall be placed no later than C.I.

in advance of its requested delivery date. Each order shall bear the

exact quantity ordered and the delivery date.

4.3. DUSA and MEDAC shall C.I. in good faith, based upon C.I. (as defined

in the Former Supply Agreement) by DUSA.

4.4. Deliveries shall be made C.I. (according to C.I.) if not otherwise

agreed upon between MEDAC and DUSA.

5. PRICES AND PAYMENT

5.1. The cost to DUSA for the API supplied by MEDAC under this Agreement

shall be negotiated in good faith taking into account that the cost

per unit of C.I. was C.I.. The Cost of the API shall C.I. following

the C.I. to DUSA and thereafter may be adjusted C.I., provided that,

MEDAC gives DUSA C.I. prior written notice of any increase.

5.2. Invoices are due C.I. after date of invoice.

5.3. All payments shall be made C.I..

6. DEFECTS IN QUALITY/QUANTITY

6.1. DUSA shall be obliged to inspect, examine and analyze the API promptly

upon receipt. In the event that the API does not conform to

Specifications of this Agreement, or the Former Supply Agree