BIOMIRA SEVERANCE AGREEMENT SEVERANCE AGREEMENT made as of the 06 day of July 1998

Exhibit 10.7

BIOMIRA SEVERANCE AGREEMENT

        SEVERANCE AGREEMENT made as of the 06 day of July 1998.

        BETWEEN:

        WHEREAS the Company has implemented an Executive Severance Plan in relation to the termination of employment of Employee-Officers of the Company in the following situations:

A)

In the regular course of events (i.e. other than in the event of a "Change of Control"), and



B)

In the event of a "Change of Control".

        The following terms of severance will apply. These are based on an agreement that you will not accept employment or contract work with a direct competitor of the Company for a period of two (2) years from the date of severance. For purposes of this Agreement, direct competitors include companies or divisions of companies that have, as their primary technology platform, the development of therapeutic cancer vaccines or technologies involving KLH conjugation or liposomal IL2 immune modulators involving cytokines in liposomal formulations.

Termination of Services

A.

If in the regular course of events Biomira Inc. should deliver to you written notice that your services hereunder will no longer be required, Biomira Inc. will pay or cause you to be paid (a) one and one-half (1.5) times the amount of your annual salary in effect at the time such notice is given, (b) the annual bonus amount, if any, paid to you in relation to the immediately preceding fiscal year, and (c) an additional sum equal to 20% of your annual salary then in effect in lieu of any further benefits under this letter agreement, except to the extent these would already have accrued or been earned by you under Biomira Inc.'s retirement or option plans (all benefits cease as of the date of severance). The sum of these amounts (a), (b) and (c) shall be paid in equal monthly installments, over 18 months.

If such notice is given, you agree to resign forthwith from any and all offices and directorships held by you with Biomira Inc. and release Biomira Inc. and its officers from any additional severance or other employment related obligations. The "date of severance" will be the date of the written notice or such date as specified therein.

In addition, should Biomira Inc. purport to alter the scope of your duties hereunder, in such manner that in result you suffer what would constitute a demotion (in the context of an employer-employee relationship), you shall be entitled to treat this as notice of constructive termination of your services hereunder. In such event, the provisions hereinabove specified in respect of compensation in lieu of notice shall apply mutatis mutandis, with the date of the change of duties being the date of severance, unless otherwise mutually agreed.

It is further understood and agreed that if services are terminated as provided above, share options continue to become vested until the first anniversary of the date of severance. In accordance with your Stock Option Agreements 04-May-95 (as amended 29-Jul-96), 18-Jan-96 (as amended 29-Jul-96), and 10-Dec-97, the expiry date for all vested share options will be the second anniversary of the date of severance or the expiry date of your options, whichever is sooner.

Biomira Inc. shall, notwithstanding the foregoing, not be deemed to have terminated your services if you have reached normal retirement age and Biomira Inc. has indicated it no longer wishes to retain your services. For the purposes hereof the expression "normal retirement age" shall mean, in the absence of an agreement to the contrary by the parties, the day when you shall have reached the full age of 65 years.

It is further understood and agreed that if the termination of service occurs within one and one-half (1.5) years of your normal retirement age, the total amount payable under the preceding paragraphs shall be calculated as provided therein and then multiplied by a fraction, the numerator of which is the number of whole months remaining until the normal retirement age date and the denominator of which is 18 months.

In the event of termination of your employment by reason of death or disability, you (or your designated beneficiary or estate) will be entitled to all rights available to you under Biomira Inc.'s benefit and compensat