WHEREAS, in connection with such settlement, and without amending or modifying any terms and conditions of the Existing License and Supply Agreement, Cephalon wishes to grant to Barr, and Barr wishes to receive, the additional rights and licenses set forth in this Agreement, subject to the terms and conditions hereof.

NOW, THEREFORE, in consideration of the foregoing and for good and valuable consideration, the receipt and adequacy of which is hereby affirmed, and intending to be legally bound hereby, the Parties hereby agree as follows:

1.              DEFINITIONS

All capitalized terms not defined herein shall have the respective meanings ascribed to such terms in the Existing License and Supply Agreement. The following terms shall have the following respective meanings:

1.1            “ ACTIQ Licensed Product ” means both “ACTIQ Licensed Product” and “ACTIQ SF Licensed Product” as each of those terms are defined in the Existing License and Supply Agreement.

1.2            “ Affiliate ” means any corporation, partnership, joint venture or firm which controls, is controlled by or under common control with a specified person or entity. For purposes of this definition, “control” shall be presumed to exist if one of the following conditions is met: (a) in the case of corporate entities, direct or indirect ownership of at least fifty percent (50%) of the stock or shares having the right to vote for the election of directors and (b) in the case of non-corporate entities, direct or indirect ownership of at least fifty percent (50%) of the equity interest with the power to direct the management and policy decisions of such non-corporate entities.

1.3            “ Barr ” means Barr Laboratories, Inc., a corporation organized and existing under the laws of the State of Delaware, with its principal place of business at 400 Chestnut Ridge Road, Woodcliff Lake, New Jersey 07677, and its directors, officers, employees, agents and representatives, predecessors, successors, and assigns; its subsidiaries, divisions, groups, and the respective directors, officers, employees, agents and representatives, successors, and assigns of each.

1.4            “ Cephalon ” means Cephalon, Inc., a corporation organized and existing under the laws of the State of Delaware, with its principal place of business at 41 Moores Road, Frazer, Pennsylvania, and its directors, officers, employees, agents and representatives, predecessors, successors, and assigns; its subsidiaries, divisions, groups, and the respective directors, officers, employees, agents and representatives, successors, and assigns of each.

1.5            “ Exclusivity Period ” means the period from December 6, 2006 through the Existing License Effective Date.

**Portions of the Exhibit have been omitted and have been filed separately pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

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1.6            “ Existing License Effective Date ” means the date on which the license granted under Section 2.1(a) (i), (ii) and (iv) of the Existing License and Supply Agreement becomes effective under Section 2.1(b) of the Existing License and Supply Agreement.

1.7            “ Generic Subject OTFC Product ” means any Subject OTFC Product that is not marketed under the ACTIQ® mark.

1.8            “ Licensed Patents ” means the (a) ACTIQ Patent Rights, including those patents owned by Cephalon and identified in Exhibits C and E to the Existing License and Supply Agreement, (b) ACTIQ Patent Rights licensed to Cephalon, including those identified in Exhibit D to the Existing License and Supply Agreement, and (c) ACTIQ SF Patent Rights, including those patents owned by Cephalon and identified in Exhibit F to the Existing License and Supply Agreement.

1.9            “ Net Profits ” shall mean the gross receipts derived in arms-length transactions from the sale of ACTIQ Licensed Product in the United States by Barr (or by its Affiliates), to independent third parties in the United States, less the sum of the following items:

(a)            Import, export, excise and sales taxes and custom duties paid or allowed by the selling party and any other governmental charges imposed upon the production, importation, use or sale of ACTIQ Licensed Product by Barr and/or its Affiliates;

(b)            Credit for returns, refunds, rebates and allowances, or trades to customers for returned or recalled ACTIQ Licensed Product;

(c)            Trade, quantity and cash discounts actually allowed;

(d)            Transportation, freight and insurance allowances;

(e)            Rebates to wholesalers, administrative fees in lieu of rebates paid to managed care and other similar institutions, chargebacks and retroactive price adjustments, including Shelf Stock Adjustments, and any other similar allowances which effectively reduce the net selling price; and

(f)             The purchase price paid to Cephalon for ACTIQ Licensed Product pursuant to Section 6.1(d) of the Existing License and Supply Agreement, as incorporated herein by Section 4.1(c) of this Agreement, or Barr’s direct and reasonable costs of making ACTIQ Licensed Product, as applicable, which shall in no event be greater than Barr’s costs of purchasing ACTIQ Licensed Product from Cephalon pursuant to Section 6.1(d) of the Existing License and Supply Agreement as so incorporated.

Gross and Net Profits shall be calculated according to US GAAP. Sales or transfers between or among a Party and its Affiliates shall be excluded from the computation of Net Profits except where such Affiliates are end users, but Net Profits shall include the subsequent final sales to third parties by such Affiliates.

Where (i) ACTIQ Licensed Product is sold as one of a number of items without a separate price; or (ii) the consideration for the ACTIQ Licensed Product shall include any non-cash element; or (iii) the ACTIQ Licensed Product shall be transferred in any manner other than

**Portions of the Exhibit have been omitted and have been filed separately pursuant to an application for confidential treatment filed with the Securities and Exchange Commission pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as amended.

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an invoiced sale, the gross sales applicable to any such transaction shall be deemed to be the selling party’s average gross sales in the United States for the applicable quantity of ACTIQ Licensed Product during the calendar quarter. If there are no independent gross sales of ACTIQ Licensed Product in the United States at that time, then Barr and Cephalon shall mutually agree on a surrogate measure to be used in lieu thereof.

1.10          “ Party ” or “ Parties ” means a party, or the parties, to this Agreement.

1.11          “ Pediatric Exclusivity ” means exclusivity obtained in accordance with the requirements of Section 505(a) of the U.S. Federal Food, Drug, and Cosmetic Act (21 U.S.C. § 355(a)).

1.12          “ Shelf Stock Adjustment ” means the customary practice of providing a purchaser of ACTIQ Licensed Product an adjustment to the net purchase price for on-hand inventory in response to an offer from a supplier of a competing Generic Subject OTFC Product,.

1.13          “ Subject OTFC Product ” means [**].

2.              GRANT OF RIGHTS

2.1            Exclusivity; License . If, and only if, the Existing License Effective Date has not occurred on or prior to December 6, 2006, then the following terms and conditions shall apply:

(a)            Exclusive Authorized Generic . During the Exclusivity Period, Cephalon shall not market or sell, nor shall it license or authorize any entity other than Barr to market or sell, Generic Subject OTFC Products in the United States.

(b)            Grant of Licenses . Cephalon grants to Barr an irrevocable, non-transferable, exclusive (even as to Cephalon) license, without the right to sublicense, to develop, use, sell, offer for sale, distribute or have distributed, promote or advertise, import or have imported ACTIQ Licensed Product solely in the United States and solely during the Exclusivity Period, in each case, under:

(i)             the Licensed Patents; and

(ii)            (A) the U.S. Trademark Registration No. 2,622,734 as needed for a single dose entity of an ACTIQ Licensed Product (B) any trademark or trade dress covering the size, shape and color of a single dose entity of ACTIQ Licensed Product, to the extent Barr desires; and (C) the appearance, structure, textual or graphical content and/or color scheme of any labeling, dosing information, product inserts, Skeeper or other materials, and any Risk Management Program, as may be necessary for the marketing and sale of ACTIQ Licensed Product.

The Parties acknowledge Barr’s rights to certain manufacturing know-ho