Exhibit 10.1

Confidential Materials omitted and filed separately with the

Securities and Exchange Commission.  Asterisks denote omissions.

Product License and Supply Agreement

Parties

This Product License and Supply Agreement (the “Agreement”) is effective January 1, 2007 (the “Effective Date”), by and between

CollaGenex Pharmaceuticals, Inc. with offices at 41 University Drive, Newtown, Pennsylvania 18940, USA (“CollaGenex”), and

MediGene AG, with offices at  Lochhamer Strasse 11, DE82152 Planegg/Martinsried, Germany (“MediGene”).

Recitals

WHEREAS , CollaGenex filed and on 27 May, 2006 the U.S. Food and Drug Administration approved, New Drug Application 50/805 covering the marketing and sale of a 40mg controlled release doxycycline monohydrate capsule conforming to the specifications described in such application (such product being referred to as the “Product”), and

WHEREAS , CollaGenex filed a Request for Marketing Authorisation for the Product with the U.K. Medicines and Healthcare Regulatory Agency on February 27, 2006 under file number PL 27682/0001 (the “RMA”) pursuant to the decentralized approval procedure of the European Community, identifying as concerned member states those countries identified with an *asterisk on Exhibit A, and at or about the same time filed a national application seeking marketing authorization for the Product in Switzerland;

WHEREAS, CollaGenex is the owner or licensee of various Patents and Trademarks more fully set out below, which cover the Product;

WHEREAS, MediGene intends to build a direct sales force to specialize in the sale of pharmaceuticals used to treat dermatological indications, which sales force will directly call on dermatologists in selected countries in the Territory (as defined below) and intends to sublicense the manufacture, marketing, distribution and sale of the Product in the other countries in the Territory; and

WHEREAS, CollaGenex wishes to license the right to manufacture, market, distribute and sell the Product in the Territory and MediGene is willing and able to so and wishes to accept such license.

CollaGenex and MediGene (each a “Party”) Agree As Follows:

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DEFINITIONS

In this Agreement, the following terms appear as defined terms in more than one place and have the meanings ascribed to them in the following sections or paragraphs:

1.             Grant of License .

(a)                     Exclusive License.   CollaGenex grants to MediGene an exclusive royalty bearing license and, as the case may be, an exclusive royalty bearing sublicense (the “License”) under the Patents, the Trademarks, the Product Know-How and the Product Data (all as defined below and collectively referred to as the “Licensed Assets”) to the extent necessary to obtain marketing authorisations for, and to manufacture,  have manufactured, to market, have marketed, to distribute, have distributed, and to sell and have sold the Product in the field of dermatology in the Territory.

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(b)                    Right to Sublicense.    All licenses granted under this Agreement shall include the right to grant sublicenses subject to the appropriate terms hereof being accepted by any sublicensee, and on the express understanding that any such sublicense shall not affect the performance or other obligations of MediGene hereunder.

(c)                     Exclusivity.   CollaGenex shall not itself, and shall not authorise any other party to, market, distribute, or sell the Product in the Territory, nor will CollaGenex market, distribute or sell in the Territory any other systemic product approved for the treatment of acne or rosacea and having as its active ingredient doxycycline.  Nothing in this paragraph shall preclude CollaGenex from authorizing any other party to, or itself deciding to, develop or market or sell in the Territory a systemic product approved for the treatment of a clinical indication outside dermatology and having as its active ingredient doxycycline.

(d)                    Territory.   The “Territory” shall mean those countries listed on Exhibit A. MediGene shall not sell the Products outside the Territory, nor to any other person that - to MediGene’s best knowledge - is selling or that intends to sell the Products outside the Territory.

(e)                     Imports Into Territory.   CollaGenex shall use its best efforts to ensure that Products are not imported into the Territory from any other geography and shall immediately respond to any report of such activity and shall take appropriate measures to halt it.

(f)                       Non-Compete; Non-solicitation.   MediGene agrees that, in consideration for receiving and acquiring this License, it will not, for the term of this Agreement and for a period of one year thereafter, except in case of expiration of the Agreement according to sec. 16(a), market, distribute or sell any product which is an oral systemic therapy for dermatological conditions containing doxycycline or any chemically modified tetracyclines, neither will it solicit the employment of any employee of CollaGenex.

2.             Licensed Assets .

(a)                     Patents.  The “Patents” covered by this Agreement include all the patents and patent applications, utility models and designs related to the Product as of the Effective Date and at any time during the Term of this Agreement, which are necessary or appropriate to market, distribute, sell and manufacture the Product in the Territory, which are under control of CollaGenex. The patents and patent applications as of the Effective Date are listed and grouped on Exhibit B and include

(i)                                 The SUNY Patent(s), of which CollaGenex is the exclusive licensee in the field of dermatology, and to which CollaGenex grants MediGene a sublicense pursuant to this Agreement;

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(ii)                              The Supernus Patent(s), of which CollaGenex is the exclusive licensee in the field of dermatology, and to which CollaGenex grants MediGene a sublicense pursuant to this Agreement;

(iii)                           The CollaGenex Patents, of which CollaGenex is the owner and to which CollaGenex grants MediGene a license pursuant to this Agreement.

Included in the Patents are furthermore corresponding foreign intellectual property rights having the same priority dates and patent applications that claim priority in whole or in part from the specified foreign intellectual property rights including but not limited to continuations, continuations-in-part, divisionals, reexaminations and reissues of such foreign intellectual property rights.

(b)                    Trademarks.   The “Trademarks” covered by this Agreement include all the trademarks listed on Exhibit B, provided, however, that CollaGenex grants MediGene the right but does not impose on it the obligation to use such trademarks for the purpose of promoting the Products.  CollaGenex may at any time remove any Trademark from Exhibit B upon notice to MediGene if, at such time, MediGene has not informed CollaGenex of its intention to use such Trademark.  MediGene shall be free to use its own trademarks for the purpose of marketing, distribution, sale and manufacturing of the Products.  If MediGene elects to use the Trademarks, it shall use them only in connection with the promotion of the Products and shall not alter, modify or otherwise change the Trademarks. If changes to or of Trademarks are necessary due to legal, regulatory or other aspects based on a good faith determination by MediGene, Parties will jointly discuss how to implement such changes without diminishing the goodwill attaching to any Trademark anywhere in the world and in light of such discussions CollaGenex will not unreasonably withhold  approval to such changes. CollaGenex further agrees that MediGene may use its own name and logo in connection with such trademarks, provided that the manner of such use has first been approved by CollaGenex, such approval not unreasonably withheld or delayed. Nothing in this limited grant of rights shall imply that either Party acquires, nor will it acquire, any further rights whatever in or to the trademarks or trade names of the other Party

(c)                     Product Know-How. The “Product Know-How” covered by this agreement means all Know-How (as defined below) related to the Product which is under control of CollaGenex as of the Effective Date or is created during this Agreement, which is not covered by the Patents but is necessary or useful to market, distribute, sell or manufacture the Product. As used in this Agreement, “Know-How” shall mean tangible and intangible: techniques, technology, practices, trade secrets, discoveries, inventions, methods, formulas, knowledge, know-how, skill, experience, tests, assays, test data and results (including pharmacological, toxicological, pre-clinical and clinical test data and results), technical, non-technical, analytical and quality control data, results or descriptions, drawings, plans, diagrams, software and algorithms.

(d)                    Product Data   The “Product Data” covered by this Agreement shall include all the data included in the RMA, and such other data referenced therein or otherwise under the control of CollaGenex relating to the development,

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                                  manufacture, use or sale of the Product as MediGene may reasonably request in order to carry out the intentions of this Agreement.

3.             Consideration .

(a)                     Execution Payment.   In consideration for the grant of the above license, MediGene will pay U.S. $5 million to CollaGenex within 30 days after execution of this Agreement.

(b)                    First Sales Milestone.   MediGene will pay CollaGenex U.S. $[**] when  aggregate revenues required by GAAP to be reported from sales of the Product in the Territory for the first time exceed U.S. $[**] in any twelve month period adopted by MediGene as a financial year for purposes of its financial reporting (an “Annual Accounting Period”).

(c)                     Second Sales Milestone.   MediGene will pay CollaGenex U.S. $[**] when  aggregate revenues required by GAAP to be reported from sales of the Product in the Territory for the first time exceed U.S. $[**] in any Annual Accounting Period, provided, however, that in the event that both the first and the second sales milestones described in Sections 3 (b) and 3(c) occur are passed in the same Annual Accounting Period, both milestone payments, for a combined amount of U.S. $7.5 million, would be payable in the same Annual Accounting Period. For the avoidance of doubt the Milestone payments under Sec. 3 (b) and 3 (c) shall under no circumstances exceed the aggregate amount of U.S. $ 7.5 million.

(d)                    Accounts and Exchange Rate.   Payments according to Sec. 3 (b) an 3 (c) shall be paid within 30 days after the annual accounts of MediGene have been audited by the certified public accountant of MediGene. All Payments hereunder shall be payable in united States dollars using the arithmetic average of the daily exchange rates (U.S.$/€) during the Annual Accounting Period, for which a milestone payment shall be made, taken from the Wall Street Journal, Eastern U.S. Edition or, if such exchange rates are not available with respect to any given day, from Reuters Daily Rate Report.

(e)                     Russian Milestone. MediGene will pay CollaGenex [**] of any lumpsum payments received from distributors or sub-licensees within 3 years of the execution of a sub-license or similar agreement providing such distributor or sublicensee with the right to market and sell the Product in Russia. Such payments shall be made to CollaGenex within 30 days of receipt by MediGene of the corresponding payment.

4.             Royalties .

(a)                     Running Royalty.   MediGene shall pay to CollaGenex a running royalty as follows:

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(i)                                 12% of Net Sales on the first U.S. $10 million of Net Sales in any Annual Accounting Period; and

(ii)                              15% of Net Sales on Net Sales in excess of U.S. $10 million in any Annual Accounting Period.

(b)                    Renegotiation of Royalty.   For so long as MediGene does not exercise its right to manufacture, the above rates may be renegotiated if the Transfer Price (as defined below) exceeds [**]% of average unit sales price required by GAAP to be reported from sales of the Products in those countries identified as Concerned Member States in the RMA in any Annual Accounting Period.

(c)                     Minimum Royalties.   At any time after CollaGenex has obtained “RMA Approval” (being the national marketing authorisation in Germany and U.K.) royalties payable to CollaGenex shall be no less than:

(i)                                 U.S. $[**] in the Annual Accounting Period relating predominantly to 2007,

(ii)                              U.S. $[**] in the Annual Accounting Period relating predominantly to 2008;

(iii)                           U. S. $[**] in the Annual Accounting Period relating predominantly to 2009, and in all Annual Accounting Periods thereafter.

provided, however, that the amounts may be reduced in the manner set out in the attached Exhibit D if RMA Approval is not obtained before [**];

(d)                    Net Sales.   For the purposes of this Agreement, “Net Sales” shall mean aggregate amounts received from sales of the Products in the Territory by MediGene or its sublicensees, less all trade or quantity discounts or rebates actually allowed, discounts or rebates actually allowed to government or non-government healthcare providing or g anizations, returns, and prompt payment discounts, calculated according to GAAP consistently applied.

(e)                     Reports.   Within [**] Business Days of the end of each [**], MediGene shall provide CollaGenex with a non-binding pro-forma estimate of Net Sales of the Product in the Territory during such [**].  Within [**] calendar days (each day counted on the calendar being considered a “Calendar Day” whether or not business is conducted on such day) of the end of each calendar [**] (or whatever [**] date MediGene shall adopt for purposes of its financial reporting), MediGene shall submit to CollaGenex a report setting out the prescriptions, unit sales and selling prices of the Product in the Territory in such [**] in sufficient detail, but not including any customer data, to substantiate its calculation of the royalty payable in respect of such [**] (the “[**] Report”).

(f)                       Payments and Exchange Rate.   All payments required under this Section shall be calculated in Euros and made in United States dollars using the arithmetic average of the daily exchange rates (e.g., Dollar/Euro), during the quarterly accounting period covered by the relevant royalty calculation, taken from The Wall Street Journal , Eastern U.S. Edition or, if such exchange rates are not

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                                  available with respect to any given day, from the Reuters Daily Rate Report . Such amounts will then be delivered for deposit to the account or accounts specified from time to time by CollaGenex within 60 Calendar Days of the end of the quarter in which they became due. The shortfall, if any, between paid royalties and Minimum Royalties,  will be paid together with the royalty payment for the fourth quarter of each Annual Accounting Period.

(g)                    Withholding Taxes.   MediGene shall be responsible for paying and for accounting for all withholding or other taxes for which the payor of any of the payments described above is legally responsible, and shall fully document any such payment which diminishes the amount of royalty or other payments due to CollaGenex.

(h)                    Right to Audit.   MediGene shall keep records in sufficient detail to permit the determination of Net Sales and royalties payable under this Agreement and, at the request and expense of CollaGenex, shall permit an independent certified public accountant, reasonably acceptable to both parties, to examine, in confidence, during ordinary business hours once in each Annual Accounting Period, subject to a thirty (30) day written notice by CollaGenex thereof, such records as may be necessary to verify or determine royalties or other payments paid or payable under this Agreement.  CollaGenex shall pay for such audits and inspections, except that in the event that any such audit covering at least four (4) calendar quarters reveals that, during the period covered by the audit, MediGene paid to CollaGenex less than ninety-five percent (95%) of the aggregate amount of Royalties that were due to CollaGenex with respect to such period, MediGene shall be obligated to reimburse CollaGenex for the reasonable out-of-pocket costs incurred by CollaGenex with respect to such audit.

5.             MediGene Promotional Obligations .

(a)                     Sales Force.   MediGene will, at its own expense, maintain, manage and compensate a direct sales force or a contractual sales force that calls on dermatologists in the Territory and at all times is believed by MediGene to be sufficient to achieve in excess of the Minimum Sales set out below.  MediGene shall ensure that such sales force is trained in the promotion and sale of the Product.  All costs related to the training of the sales force shall be borne by MediGene.

(b)                    Promotion.   MediGene shall use all reasonable legal efforts to promote and sell the Products in the Territory.  MediGene will be responsible at its own expense for designing and producing all promotional materials in compliance with applicable EU directives, provided, however, that CollaGenex shall make available to MediGene upon request examples of all promotional materials used by CollaGenex to promote the Product outside the Territory.

(c)                     Minimum Sales .  MediGene shall achieve, subject to CollaGenex’s diligent and timely fulfillment of obligations under this Agreement, at least the following

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                                  aggregate levels of Net Sales of the Products in the Territory, during the following time periods (the “Minimum Sales”):

Annual Accounting Period relating predominantly to 2009              $[**]

Annual Accounting Periods after 2009 up to and until competition by systemic antibiotic products with submicrobial formulations or applications, including but not limited to incyclinide, is launched in the Territory            $[**]

provided, however, that these amounts may be [**] in the manner set out in the attached ExhibitD if RMA Approval is not obtained before [**]

The failure to achieve the Minimum Sales in 2009 or any subsequent Annual Accounting Period in which Minimum Sales have to be achieved shall trigger CollaGenex’s right of termination set out in Section 16 (b) (i).

6.             Marketing Authorisations

(a)                     RMA Approval.

(i)                                 CollaGenex will use reasonable best efforts to achieve RMA Approval.

(ii)                              In case that RMA Approval is granted as a conditional approval any reasonable costs and expenses arising in connection with or fulfilling the conditions attached to such approval shall be borne

(A)            solely by CollaGenex if such condition is to be fulfilled prior to sale of the Product in Germany or U.K. or

(B)              as follows if such condition is to be fulfilled subsequent to approval and sale of the Product in Germany or U.K.:

(aa)         the first $ [**].- shall be borne solely by CollaGenex;

(bb)         the next $ [**].- shall be borne solely by MediGene;

(cc)                          Amounts in excess of $ [**].- shall be split with [**]% borne by CollaGenex and [**]% borne by MediGene,

provided, however, that if MediGene reasonably estimates that the cost of fulfilling any post-approval condition will exceed $ [**].-, MediGene shall have the right, at any time, during a period of [**] days following the announcement of a post approval condition, to refuse to fund the fulfillment of such post approval condition, in which case all of its rights and obligations under this Agreement with respect to the country requiring such post approval condition shall terminate.

(iii)                           CollaGenex warrants, that it will promptly transfer on a country-by-country basis to MediGene all the national marketing authorisations that CollaGenex obtains in the Territory; provided, however, that if transfer of

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                                           such marketing authorisations is for any reason not permitted, CollaGenex will use best efforts to provide MediGene with all the rights necessary to carry out the activities contemplated by this Agreement.  At the time of each such transfer, MediGene shall assume the responsibilities of a marketing authorisation holder in the relevant country. CollaGenex shall provide MediGene with copies of or access to all the documents received by CollaGenex in connection with achieving of or applying for national marketing authorisations, together with such clinical documentation and clinical results as may be needed by MediGene (including its affiliates or sublicensees) to fulfill its obligations under this Agreement and to comply with applicable laws in the Territory.

(iv)                          Immediately following RMA Approval CollaGenex will transfer to MediGene the sponsorship of all national marketing authorisations that are pending at that time, provided, however, that if transfer of such marketing authorisations is for any reason not permitted, CollaGenex will use best efforts to provide MediGene with all the rights necessary to carry out the activities contemplated by this Agreement.

(b)                    Further Marketing Authorisations   [**] days after receipt of RMA Approval, MediGene shall formulate, submit to CollaGenex, and begin diligently to pursue a plan for obtaining marketing authorisations for the Product [**]. Such plan shall be subject to approval by CollaGenex (such approval not to be unreasonably withheld). In the event that MediGene fails for any reason to put together a plan that meets with CollaGenex’s reasonable approval with respect to any country, or fails to obtain a marketing authorisation in any country specified in the approved plan within the time frame set out for such country in the plan, then CollaGenex shall have the right itself, or through a third party, on a co-exclusive basis to seek a marketing authorization in such country and to market and sell the Product in such country.

(c)                     Specifications. In its dealings with regulatory agencies in the Territory in connection with obtaining or maintaining marketing authorisations, MediGene shall not agree to any changes in the Specifications for the  Product without obtaining advance written approval of CollaGenex, pursuant to the notice procedure specified in Section 21.

(d)                    Pricing Negotiations.    MediGene shall be responsible for pricing and reimbursement negotiations with relevant authorities and private-sector pharmaceutical benefit management organizations in the Territory.

(e)                     Status Reports.   In its Quarterly Reports MediGene shall inform CollaGenex each quarter of the status of (i) its efforts to obtain marketing authorisations in the Territory and (ii) pricing and reimbursement negotiations for authorised products in the Territory.

(f)                       Cooperation in Regulatory Affairs . Upon reasonable advance notice each Party agrees to make its employees and non-employee consultants reasonably available (up to 40 hours per year) at their respective places of employment to consult with the other Party on issues arising in connection with any request

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                                  from any regulatory agency, including , without limitation, regulatory, scientific, technical and clinical testing.

(g)                    Maintenance of Marketing Authorisations.   At the time of receiving the transfer from CollaGenex of any marketing authorization, or of itself obtaining any marketing authorisation, MediGene shall assume the reponsibilities of Marketing Authorisation Holder in the relevant country and will, at its sole cost and expense, maintain all such marketing authorisations or other rights, including obtaining any variations or renewals thereof and paying any license or other fees required as part of such maintenance.

(h)                    Registration Dossiers.   CollaGenex shall have the right of full access at any time to any of the registration dossiers of MediGene, including stability and all other data associated with the Product, to enable CollaGenex (or an affiliate of CollaGenex or an authorised regulatory agent of CollaGenex) to utilise the data contained therein for any registration applications that CollaGenex may wish to make in any jurisdiction for any product for clinical indications outside dermatology.

(i)                        Adverse Drug Event Reporting. Parties will enter into a separate agreement concerning Adverse Drug Event Reporting reflecting the requirements of applicable laws and regulations.

7.             Manufacture, Purchase and Supply of Product

(a)                     Purchases.   Until MediGene has exercised its right to manufacture and executed the Technology Transfer Agreement pursuant to Section 12 of this Agreement, and additionally thereafter for any transitional period provided in the Technology Transfer Agreement (such entire period being referred to as the “Purchase Period”), MediGene shall purchase the Product exclusively from CollaGenex and CollaGenex agrees to manufacture or have manufactured and sell the Product exclusively for and to MediGene during the Term of this Agreement for sale of Product in the Territory.

(b)                    Quality Assurance. CollaGenex shall manufacture or have manufactured the Product in accordance with the specifications set forth in the approval of the marketing authorisations in the Territory (the “Specifications”), all laws and guidelines that apply to it or its operations, Good Manufacturing Practices (including European GMP) and applicable laws, guidelines and regulations referenced in the marketing authorisation issued by the reference member state, provided, however, that any additional costs incurred in conforming to such Specifications, practices or guidelines, to the extent they deviate from the specifications of the Product set forth in the FDA approval relating to NDA 50/805, shall be borne by MediGene. However, if those additional costs include set up or other costs prior to initiation of manufacture that are estimated by MediGene as likely to exceed $ 1,000,000.-, then MediGene shall have the right to terminate this Agreement pursuant to section 16 (c) (v). CollaGenex shall not, without prior written notice to MediGene, change its current contract

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