SUPPLY AGREEMENT

Exhibit 10.31

CERTAIN CONFIDENTIAL INFORMATION CONTAINED IN
THIS DOCUMENT, MARKED BY BRACKETS, 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 AGREEMENT

Between

ASH STEVENS, INC.

and

PHARMION CORPORATION

Dated: March 31, 2005

TABLE OF CONTENTS

SUPPLY AGREEMENT

      THIS SUPPLY AGREEMENT (the “ Agreement ”) is made effective as of March 31, 2005 (“ Effective Date ”) between:

Pharmion and Ash Stevens are sometimes individually referred to herein as a “ Party ” and collectively as the “ Parties ”.

In consideration of the mutual agreements set forth herein, and other good and valuable consideration the receipt and sufficiency of which are acknowledged, the Parties, intending to be legally bound, hereby agree as follows:

ESSENTIAL TERMS AND CONDITIONS

The following are contractual essential terms and conditions collected together here solely for the convenience of the Parties:

TERMS AND CONDITIONS

          (a) General . Subject to and in accordance with the provisions of this Agreement, Ash Stevens shall manufacture and supply Compound to Pharmion (and Pharmion’s affiliates and licensees, as authorized and directed in writing by Pharmion from time to time subject to the rights of Ash Stevens under Section 1(g), hereinafter “ Pharmion Designees ”), as ordered by Pharmion pursuant to this Section 1. As authorized and directed by Pharmion, Pharmion Designees may exercise the rights of Pharmion pursuant to this Agreement pertaining to the supply of Compound. All sales of Compound to Pharmion and Pharmion Designees shall be subject to the terms and conditions of this Agreement.

          (b) Exclusivity .

          (c) Orders . Pharmion and Pharmion Designees may order Compound from Ash Stevens by placing written purchase orders during the Term of this Agreement (“ Orders ”). During the Term Ash Stevens shall accept all such Orders which are for quantities which are not

more than 120% of the quantities specified by Pharmion and Pharmion Designees in the then-current Rolling Forecast (as defined in Section 2(a) hereof) for the relevant period, and shall acknowledge promptly (and in any event within ten (10) business days) each Order in writing and confirm the delivery dates and the destinations specified in the relevant Order. During the Term, Ash Stevens shall timely make delivery on Orders for which the delivery date specified is at least [... *** ...] after the date of the Order. In the event of any inconsistencies between the terms of this Agreement and any Order issued by Pharmion and Pharmion Designees hereunder or any acceptance thereof by Ash Stevens, the terms of this Agreement shall govern.

          (d) Force Majeure . Neither Party shall be considered in default of the performance of any obligation hereunder to the extent that the performance of such obligation is prevented or delayed by fire, flood, earthquake, explosion, strike, acts of terrorism, war, insurrection, embargo, government requirement, civil or military authority, act of God, or any other event, occurrence or condition which is not caused, in whole or in part, by that Party, and which is beyond the reasonable control of that Party (each a “ Force Majeure Event ”); provided, however, that Ash Stevens shall notify Pharmion promptly of anticipated delivery delays and shall use commercially reasonable efforts to fill delayed Orders as soon as possible. Pharmion may cancel any Order, in whole or in part, which is delayed more than thirty (30) days after the delivery date in such Order, but only if Ash Stevens has performed no work on such Order. For the avoidance of doubt, any failure by suppliers to Ash Stevens to timely deliver starting materials, ingredients, resources and services used to make the Compound when properly ordered by Ash Stevens shall be considered a Force Majeure Event.

          (e) Purchase Prices and Payment . Prices for Compound are as specified in Exhibit B hereto. Ash Stevens shall invoice Pharmion for the purchase price of all quantities of Compound purchased hereunder concurrently with Ash Stevens’s shipment thereof to Pharmion, or for the safety stock of Compound specified in Section 2(b) hereof, when such Compound is placed in such safety stock for Pharmion by Ash Stevens. All amounts properly invoiced by Ash Stevens hereunder shall be due and payable thirty (30) days from Pharmion receipt of such invoices. Payment may be made by corporate check or by wire transfer of funds to such account in the name of Ash Stevens as Ash Stevens may designate by notice to Pharmion. Unless otherwise agreed by Ash Stevens in writing, all payment for Compound purchased by Pharmion Designees shall be charged and invoiced to the account of Pharmion and Pharmion shall pay all such invoices in accordance with the terms set forth herein.

          (f) No Diligence Requirement for Pharmion . Nothing in this Agreement or any other agreement between the Parties shall obligate Pharmion to commence or continue manufacture of products incorporating Compound, or otherwise commercialize the Compound or such products. If Pharmion permanently discontinues the manufacture of products incorporating Compound, then Orders which have been issued by Pharmion and accepted by Ash Stevens shall not be deemed to be cancelled, and the Parties shall fulfill their respective obligations related to such Orders as provide herein unless otherwise agreed in writing.

          (g) Pharmion shall be the guarantor of, and be fully responsible for, all payment and other obligations incurred by Pharmion Designees for Orders. Upon any failure by any Pharmion Designee to pay amounts owing to Ash Stevens or otherwise fail to perform its

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obligations hereunder, Ash Stevens shall be entitled to full and prompt compensation by Pharmion for all outstanding payment and other obligations incurred by Pharmion Designees for Orders. In consideration for the right of Pharmion Designees to have Orders filled by Ash Stevens hereunder, Pharmion hereby agrees to indemnify and hold harmless Ash Stevens from and against any and all losses, obligations, liabilities and expenses (including attorneys’ fees) for claims, demands, actions and proceedings arising in connection with Orders by any Pharmion Designee if such losses, obligations, liabilities and expenses would be indemnified by Pharmion pursuant to Section 9(c) hereof if Pharmion were the purchaser of the Compound. Notwithstanding anything herein to the contrary, Ash Stevens may in its sole discretion require that each Pharmion Designee that is not an affiliate of Pharmion enter into a supply agreement on substantially the same terms as this Agreement as a condition to submitting any Order hereunder.

          (a) Rolling Forecast . Pharmion shall provide Ash Stevens with a twelve (12) month rolling delivery forecast of the quantity of Compound that Pharmion and Pharmion Designees intends to purchase from Ash Stevens in the periods specified (the “ Rolling Forecast ”). The first six months of the Rolling Forecast (the “ Firm Period ”) shall be binding, subject to the next sentence, and the last six months of the Rolling Forecast (the “ Estimate Period ”) shall be non-binding. Pharmion shall update the Rolling Forecast every three (3) months; provided, however, in each such update, Pharmion may (i) revise (increase or decrease) the Rolling Forecast for the Estimate Period, and (ii) increase the Rolling Forecast for the Firm Period by a maximum of [... *** ...] from the quantities specified in the most recent prior Rolling Forecast but may not decrease such forecast quantities, unless otherwise agreed to in writing by Ash Stevens. Pharmion shall inform Ash Stevens as soon as possible if Pharmion reasonably expects that Orders for Compound would vary significantly (more than 20%) from the Rolling Forecast but while Ash Stevens will endeavor to satisfy Pharmion’s increased demand using commercially reasonable efforts, it is understood and agreed that Ash Stevens shall in no event be obligated to deliver quantities of Compound in excess of those quantities properly forecast in accordance with this Section 2(a).

          (b) Safety Stock . During the Term of this Agreement, as directed by Pharmion in its Orders, Ash Stevens shall manufacture and maintain a “safety stock” of Compound. Pharmion shall have discretion to determine the quantity of such safety stock from time to time, which shall become the property of Pharmion upon payment in full therefor in accordance with this Agreement. For the avoidance of doubt, quantities of Compound Pharmion wishes to have maintained as a safety stock shall be subject to the forecasting procedures set forth in Section 2(a). Ash Stevens, when shipping Compound to Pharmion in accordance with this Agreement, shall manage such safety stock with its own inventories of Compound on a “first in, first out” basis to maximize shelf life and minimize spoilage. Ash Stevens shall properly store all inventories of Compound (including such safety stock) prior to delivery pursuant to Section 3 hereof in accordance with the Specifications, cGMPs and the instructions of Pharmion; such storage shall be at Ash Stevens’ cost, except for the storage of such safety stock (for time periods after the date the relevant quantities of the Compound are released into safety stock until delivered to Pharmion) for which Pharmion shall pay Ash Stevens [... *** ...]. Title to such safety stock shall pass to Pharmion upon payment by

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Pharmion for such safety stock pursuant to Section 1(e) hereof. Ash Stevens shall segregate from other inventory and clearly mark such safety stock as the property of Pharmion, and shall not permit any lien, claim or encumbrance to apply to such safety stock. Risk of loss for such safety stock shall pass to Pharmion when actually delivered in accordance with Section 3 hereof. Pharmion may require Ash Stevens to ship such safety stock as directed by Pharmion at any time, at Pharmion’s expense pursuant to Section 3. Ash Stevens shall be entitled to invoice Pharmion for such safety stock storage charges and Pharmion shall pay all such invoices net 30 days from delivery of Ash Stevens’ invoice. In addition to the quantities of Compound held as safety stock as directed by Pharmion as contemplated by the foregoing, to further protect against shortages, Ash Stevens shall at its own expense maintain its own safety stock of Compound corresponding to not less than the greater of (i) [... *** ...], and (ii) [... *** ...] of the aggregate quantities ordered by Pharmion in the immediately preceding twelve (12) month period, with [... *** ...] of such additional safety stock levels to be achieved not later than nine (9) months after the Effective Date, and the full requirements of such additional safety stock levels to be achieved not later than eighteen (18) months after the Effective Date.

          (c) A “ Supply Shortage ” shall occur if, at any time during the Term, the quantities of Compound supplied by Ash Stevens to Pharmion or Pharmion Designees, as applicable, are less than (i) [... *** ...] of the quantities specified in Orders accepted by Ash Stevens over a period of three (3) consecutive months (the “[... *** ...] Trigger”); or (ii) [... *** ...] of the quantities specified in Orders accepted by Ash Stevens over a period of four (4) consecutive months (the “[... *** ...] Trigger”), or (iii) [... *** ...] of the quantities specified in Orders accepted by Ash Stevens over a period of six (6) consecutive months (the “[... *** ...] Trigger), where in each case such quantities were properly forecast and ordered by Pharmion or Pharmion Designees in accordance with this Section 2. In the event of a Supply Shortage, the provisions of Section 4(e) shall apply.

          (a) Shipment . Deliveries of Compound shall be EXW (“Ex Works”, INCOTERMS 2000) Ash Stevens shipping dock. Upon the request of Pharmion, Ash Stevens shall at Pharmion’s expense ship Compound to such location in the United States of America as may be specified by Pharmion in the relevant Order. Pharmion may not specify delivery locations outside of the United States of America without the prior written agreement of Ash Stevens. Ash Stevens shall ship the Compound via carriers which have mutually agreed upon. Unless otherwise agreed to in writing, Pharmion shall pay all freight charges. Ash Stevens shall include a packing list in each shipment of the Compound providing the following information: (i) Purchase Order No.; (ii) Compound Code; (iii) Quantity; and (iv) Ash Stevens Lot Number; and the shipment shall include the Certificate of Analysis and Certificate of Compliance (confirming that the Compound has been manufactured in accordance with cGMPs). Ash Stevens shall also mail a copy of each packing list to the destination and to Pharmion (to the address specified by Pharmion, which may be different from the destination) for each shipment at the time of shipment. Ash Stevens shall comply with Pharmion’s or its designee’s Receiving Requirements,

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as further described in Exhibit C hereto without additional charge. Risk of loss for Compound shall pass to Pharmion when Compound is received by the carrier at Ash Stevens’ shipping dock.

          (b) Short Quantities . After receipt of each shipment of the Compound, Pharmion or its authorized representatives shall conduct a quantity count of such shipment. Pharmion shall notify Ash Stevens in writing of any obvious shortage in quantity of any shipment of the Compound within thirty (30) days after such receipt (a “ Notice of Short Quantity ”). A shipment of the Compound is to be considered to have fulfilled the quantity specified in the relevant Order if Pharmion or its representatives does not notify Ash Stevens about any objections within such time periods.

          (c) Defects . Pharmion and its representatives shall have the right, but not the obligation, to inspect and test the quality of any shipment of the Compound pursuant to Section 7(b) (Pharmion Inspection) hereof. Ash Stevens acknowledges and agrees that (i) each shipment of the Compound shall be tested and inspected by Ash Stevens prior to release in accordance with the Specifications and cGMPs pursuant to Section 7(a) (Release by Ash Stevens) hereof, (ii) Ash Stevens shall provide Pharmion with a certificate of analysis and other proper release documentation for each shipment of the Compound, (iii) Pharmion and Pharmion Designees may rely upon such certificate of analysis and other release documentation related to each shipment of the Compound, (iv) Ash Stevens at its cost shall make and retain “retention samples” for each shipment of the Compound, as required by Section 6(f) (Retention) hereof, and (v) Ash Stevens shall not be released of its obligations under this Agreement related to any shipment of the Compound which has not been inspected or tested by Pharmion or its representatives. If Pharmion or Pharmion Designee at any time rejects a shipment of Compound, written notice thereof shall be provided to Ash Stevens.

          (d) Disputes . If there is a dispute as to whether any portion of any shipment of the Compound is not in compliance with the requirements of this Agreement, such dispute shall be resolved by having a representative of Pharmion observe the performance of the analytical testing by Ash Steven’s personnel or by having Ash Stevens observe the performance of the analytical testing by Pharmion’s personnel. If the discrepancy results cannot be resolved in this manner, the testing shall be performed by an independent, mutually acceptable, qualified third party. If analytical testing results from Ash Stevens retention samples are different from analytical testing results from Pharmion retention samples when contemporaneously obtained in the same laboratory, then the results from the Ash Stevens retention samples shall govern and control.

          (e) Replacements; Refunds; Exclusive Remedies for Quantities . If a shipment is properly rejected by Pharmion, Ash Stevens will schedule another production run as soon as commercially reasonable thereafter and will deliver a new shipment if so requested in writing by Pharmion. In the event that Ash Stevens is unable to deliver a replacement shipment of Compound that conforms to the Specification, Ash Stevens shall refund any money paid by Pharmion for such shipment. Notwithstanding anything in this Agreement to the contrary, this Section 3(e) and Sections 4(b)(iii), 4(e) and Section 6(e) are the sole and exclusive remedies available to Pharmion and Pharmion Designees for any failure by Ash Stevens to supply Compound that meets the Specification, including, without limitation, any breach of the warranties and covenants provided by Ash Stevens in Section 9(a), or for a Supply Shortage,

however, the foregoing shall not be construed to limit the indemnification obligations of either Party.

          (a) Term . The term of this Agreement (the “ Term ”) shall be the Initial Term, together with any applicable Automatic Extension Period(s), unless earlier terminated pursuant to Section 4(b) hereof.

          (b) Termination . This Agreement may be terminated prior to the expiration of the Initial Term or the current Automatic Extension Period, as relevant, as follows, but for no other reason:

          (c) Fulfillment of Orders . If this Agreement is terminated as provided above by Pharmion, then (i) Pharmion may cancel without liability all outstanding Orders for which delivery has not been completed, as determined by Pharmion in its sole discretion, and (ii) such termination will not relieve Ash Stevens of its obligation to deliver Compound ordered by Pharmion prior to the effective date of termination (except to the extent Orders are so cancelled by Pharmion).

          (d) Survival . Upon the expiration or termination of this Agreement for any reason, the following provisions of this Agreement shall survive in accordance with their terms:

Sections 2(b) (Safety Stock), 3(c) (Defects), 3(d) (Disputes), 3(e) (Replacements; Refunds), 4(c) (Fulfillment of Orders), 4(e) (Back-up Supply and Licenses), 6(b) (Regulatory Filings), 6(e) (Recalls), 6(f) (Retention), 6(g) (Further Cooperation), 7(b) (Pharmion Inspection) (such inspections after the expiration or termination of this Agreement and shall be at mutually agreeable times, with Pharmion paying Ash Stevens a fee of $200 per hour during such inspections (as such fee may be increased annually by Ash Stevens by not more than 5% per year)), 7(c) (Complaints), 8 (Health and Safety), 9 (Warranties and Indemnifications), 11 (Confidentiality and Proprietary Rights), 12 (Compliance with Law) and 13 (Other Provisions). The provisions of the Quality Agreement, as expressly specified therein to survive, shall also survive the expiration or termination of this Agreement and the Quality Agreement.

          (e) Back-up Supply and Licenses . If a Supply Shortage occurs under Section 2(c) and written notice of same by Pharmion to Ash Stevens has been given, then Ash Stevens shall have the opportunity to correct the Supply Shortage by supplying those quantities of Compound specified in Orders (which Orders had been properly forecast and submitted by Pharmion or Pharmion Designees and duly accepted by Ash Stevens) which quantities Ash Stevens had failed to supply and which failure resulted in triggering one of three alternative definitions of “Supply Shortage” as set forth in Section 2(c). From the date that the notice of a Supply Shortage is given, Ash Stevens shall have the following periods of time as applicable to correct the Supply Shortage: (i) [... *** ...] if due to the [... *** ...] Trigger, (ii) [... *** ...] if due to the [... *** ...] Trigger, and (iii) [... *** ...] if due to the [... *** ...] Trigger. If Ash Stevens has failed to correct the Supply Shortage within the applicable time period, then the Exclusivity Period shall terminate and Pharmion shall be entitled to exercise back-up supply rights under this Section 4(e) (the “Back-up Supply Rights”) and Pharmion shall thereafter be free to establish and utilize one or more alternative suppliers for the Compound. Upon failure by Ash Stevens to correct the Supply Shortage within the applicable time period, the Exclusivity Period shall terminate and shall not be considered to be reinstated merely because Ash Stevens manages to correct the Supply Shortage after the applicable time period for so doing has expired.

     Upon termination of the Exclusivity Period pursuant to this Section 4(e) and subject to the conditions and limitations set forth below in this Section 4(e), at the request of Pharmion, Ash Stevens shall provide such cooperation and assistance to Pharmion as reasonably required to establish such supplier(s) designated by Pharmion by written notice to Ash Stevens (each a “ Back-up Supplier ”). Any third party supplier who has received Ash Stevens’ process trade secrets or proprietary confidential information pertaining to the Compound (as disclosed for example in Ash Steven’ development report for the Compound, any batch production record for the Compound or within the CMC sections of the relevant NDA submissions to the FDA) from Pharmion or an affiliate of Pharmion, either directly or indirectly, shall for the purpose of payment of the Fee be deemed also to be a “Back-up Supplier”. Such cooperation and assistance may include reasonable assistance to facilitate the preparation of registrations, permits, qualifications and approvals from the relevant regulatory authorities so that such Back-up Supplier(s) shall be enabled to satisfy regulatory requirements necessary to commence manufacture and supply of Compound to Pharmion. Ash Stevens shall be responsible for all of its own reasonable costs and expenses incurred in association with rendering such cooperation and assistance. Upon termination of the Exclusivity Period pursuant to this Section 4(e) and subject to the provisions of this Section 4(e), at the request of Pharmion, Ash Stevens shall

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transfer to the Back-up Supplier(s) designated by Pharmion all Ash Stevens know-how or other confidential information within Ash Stevens’ possession that is necessary for the manufacture of Compound, provided that such Back-up Supplier(s) shall have entered into a confidentiality agreement with Ash Stevens in form and substance reasonably satisfactory to Ash Stevens for purposes of appropriately and reasonably protecting the confidentiality and restricting the use of any such Ash Stevens know-how or other confidential information.

     Ash Stevens hereby grants to Pharmion the following licenses (which together with the balance of this Section 4(e) shall survive the expiration or termination of this Agreement for any reason), subject to Pharmion’s compliance with the terms and conditions of this Agreement which pertain to the rights granted in such licenses (the “Licenses”):

     Except as expressly provided below, during the Fee Period (as defined below), Pharmion shall pay to Ash Stevens a fee of [... *** ...] of Compound (the “ Fee ”) for all quantities of Compound purchased or otherwise received from any Back-up Supplier(s) by Pharmion, its affiliates (including Pharmion Designees which are affiliates of Pharmion) and Pharmion Designees, and each of their respective licensee, sublicensees and any other third parties which derive their right to market and sell products containing the Compound from Pharmion or a Pharmion affiliate or a licensee of either of the foregoing (collectively, the “ Covered Compound Purchasers ”), either directly or indirectly. The Fee payable for any calendar quarter (or portion thereof) during the Fee Period shall be paid within ninety (90) days after the end of such calendar quarter and be accompanied by a report detailing the quantities of Compound sourced from third parties during such quarter and the calculation of the Fee payable for such quarter. The Fee will be payable during the period beginning immediately following any early termination of the Exclusivity Period (i.e. before its scheduled expiry on May 31, 2011) and ending on May 31, 2011 (the “ Fee Period ”), except as expressly provided below.

     The obligation to pay the Fee shall be suspended for a period two years immediately following any early termination of the Exclusivity Period (i.e. before its scheduled expiry on May 31, 2011) due to a Supply Shortage pursuant to this Section 4(e) that Ash Stevens has failed to correct within the applicable time period herein provided for so doing.

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     The Fee shall not be payable if Ash Stevens has materially breached its obligations under this Section 4(e), and failed to promptly cure such breach upon notice thereof, to transfer to the Back-up Supplier(s) the necessary know-how and confidential information and to provide cooperation and assistance as reasonably required, it being understood however that Ash Stevens shall be considered not to be in material breach of such obligations where the Back-up Supplier(s) has been unable or unwilling to receive or to make effective use of the information or assistance offered by Ash Stevens.

     The Fee shall not be payable in the event that the uncorrected Supply Shortage or uncured material breach of this Agreement by Ash Stevens is demonstrably due to Ash Stevens’ intentional breach of its obligations to manufacture and supply quantities of the Compound as properly forecasted, ordered and accepted hereunder (for example, because of Ash Stevens decides to allocate production capacity reserved for the production of the Compound for Pharmion to a different compound for another of its customers or fails to order necessary supplies). For the avoidance of doubt, the Fee shall remain payable for any termination of this Agreement under circumstances other than as set forth in the foregoing sentence.

     The Fee shall not be payable in respect of any Compound purchased after May 31, 2011.

     Notwithstanding any provision in this Agreement to the contrary, Ash Stevens shall be entitled to suspend (during any period of payment default) the Licenses under clause (ii) above, if sixty (60) days after written notice has been given to Pharmion of any failure to pay any amount on account of the Fee that is due and owing, such amount remains unpaid, provided that Pharmion may avoid such suspension if the Fee amounts disputed in good faith are deposited in escrow and supplemented as appropriate pending resolution of the dispute following the audit process provided in Section 13(o) hereof.

          (a) Compound Changes .

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          (b) Second Sources for Key Starting Materials . The Parties acknowledge that as of the Effective Date there is only once source of the following two (2) starting materials for the Compound: 5-Azacytosine and tetra-O-acetyl—D-ribofuranose (the “ Key Starting Materials ”). In the event that either such source for a Key Starting Material, for whatever reason, ceases to be available during the