DISTRIBUTORSHIP AGREEMENT


This Distributorship Agreement ("Agreement"), is entered into as of March 26,
1999 between:

LIGAND PHARMACEUTICALS, INCORPORATED, a corporation organized and existing under
the laws of the State of Delaware, U.S.A., with its principal place of business
at 10275 Science Center Drive, San Diego, California, U.S.A. and SERAGEN, INC. a
Delaware corporation having its principle place of business at 97 South Street,
Hopkinton, Massachusetts (collectively referred to herein as "Ligand")

and

FERRER INTERNACIONAL, S.A, a corporation organized and existing under the laws
of Spain with its principal place of business at Gran Via Carlos III, 94,
Barcelona, Spain ("Distributor")


                              W I T N E S S E T H:

A.      Ligand is a leading researcher, developer and manufacturer of
        biopharmaceutical products, including the Products, and is the exclusive
        owner or licensee of proprietary rights in such Products.

B.      Distributor is engaged in the marketing of pharmaceutical products and
        has represented to Ligand that it has the facilities, personnel and
        technical expertise to market and distribute the Products in the
        Territory.

C.      Ligand is willing to exclusively sell Products in the Territory to
        Distributor on the terms and conditions set forth in this Agreement.


NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:

1.      DEFINITIONS

For purposes of this Agreement, the following terms shall have the following
meanings:

1.1     "Affiliate" means any corporation or business entity which, directly or
        indirectly, is controlled by, controls, or is under common control with
        Ligand or Distributor, as applicable. For this purpose, "control"
        includes, but is not limited to, direct or indirect ownership of more
        than fifty percent (50%) of the voting shares or stock of such
        corporation or business entity.

1.2     "Approvals" means and includes all filings, approvals, registrations,
        permits, licenses and authorizations related to Product pricing or
        marketing activities which are necessary or

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        which, in the reasonable opinion of Ligand, are desirable, to be made
        with or obtained from any Governmental Authority for the sale of the
        Products in the Territory, including, without limitation, any pricing
        approvals, government reimbursement approvals, import permits and
        approvals concerning Distributor's facilities, but excluding Product
        Authorizations.

1.3     "Base Price" means, with respect to each Product, the price set forth in
        Attachment B.

1.4     "Confidential Information" means any and all data, trade secrets,
        confidential knowledge, specifications, clinical data and protocols and
        other proprietary information, not in the public domain, relating to the
        Products and/or the business or affairs of either party (the "Disclosing
        Party"). Confidential Information shall also include the present
        Agreement and the terms set forth herein to the extent that it has not
        been placed into the public domain by the Disclosing Party. Confidential
        Information may be communicated to the other party (the "Receiving
        Party") orally, visually, in writing, or in any other recorded or
        tangible form. All data and information will be considered to be
        Confidential Information hereunder (1) if the Disclosing Party has
        marked them as such, (2) if the Disclosing Party, orally or in writing,
        has advised the Receiving party of the confidential nature, provided
        that, if disclosed orally, the Disclosing Party confirms such
        confidential nature in writing within two weeks thereafter; or (3) if,
        due to their character or nature, a reasonable person in a like position
        and under like circumstances as the Receiving Party would treat them as
        secret and confidential.

1.5     "Dealer" means a sub-distributor, agent or marketing representative of
        Distributor.

1.6     "Effective Date" means the date of this Agreement as designated in
        preamble to this Agreement on the first page.

1.7     [Reserved]

1.8     "Governmental Authority" means and includes all governmental and
        regulatory bodies, agencies, departments or entities, whether or not
        located in the Territory, which regulate, direct or control commerce in
        or with the Territory.

1.9     "Intellectual Property Rights" means and includes all copyrights,
        designs, databases, mask works, patents, trademarks, trade names and
        other proprietary rights, and all registrations and applications
        therefor, which Ligand may at any time own, adopt, use, license or
        register with respect to a Product or its business, and includes the
        Trademarks.

1.10    [Reserved]

1.11    "Person" means and includes any agency, association, company,
        individual, or other entity regardless of the type or nature thereof.

1.12    "Product Authorizations" means and includes all filings, approvals,
        registrations and



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        authorizations relating to pharmaceutical or medicinal products which
        are necessary or which, in the reasonable opinion of Ligand, are
        desirable, to be made with or obtained from any Governmental Authority
        in order for Distributor to lawfully market, promote, offer for sale and
        sell the Products in the Territory, but excluding Approvals.

1.13    "Products" means the biopharmaceutical products manufactured by or on
        behalf of Ligand, for the indications and applications specified, which
        are listed in Appendix A, as amended by Ligand from time to time by
        written notice to Distributor; and shall include all line extensions and
        modified or improved versions of such products from time to time.

1.14    "Resale Price" means the price from the Distributor, as determined by
        the Spanish Governmental Authorities ("Precio de Venta Laboratorio"), as
        reduced by:

        (a)    freight, shipping and insurance  with respect to such Products;

        (b)    sales, excise or similar taxes imposed on the sale of the
               Products;

        (c)    any mandatory or industry standard discounts or rebates to the
               competent Governmental Authorities and/or Social Security Systems
               pursuant to the regulations and/or agreements in force; and

        (d)    cash and trade discounts and allowances as customarily applied to
               products of a similar kind in the pharmaceutical industry in the
               relevant country within the Territory;

        but in no event may the quarterly total deductions to the Precio de
        Venta Laboratorio in any country of the Territory exceed 5% of the
        Precio de Venta Laboratorio, and in any case deductions may be taken
        only if they are paid by Distributor or actually charged against
        Distributor and evidenced in Distributor's books and records of account
        and the reports provided to Ligand pursuant to Clause 9.3 hereof. If no
        such price has been approved by the Spanish Governmental Authorities,
        Resale Price shall mean the average, same distribution level price
        agreed upon by Ligand or its other distributors for the relevant
        Products with the Governmental Authorities in the first three European
        Union Member States where the relevant Product is sold. If Product
        prices have been approved in fewer than three European Union Member
        States, the Resale Price shall be the average price in such fewer
        countries or, if there is no such country, a price mutually agreed upon
        by the parties.

1.15    "Technical Assistance" means and includes advice, training, information
        and other support regarding the manufacture, specifications, clinical
        trials and marketing specifically related to the Products.

1.16    "Term" means the term of this Agreement as determined in accordance with
        Clause 3.1 and, where the context permits, includes the extensions as
        per Clause 3.2 .


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1.17    "Territory" means the geographic area comprising the countries in
        Central and South America, as listed on Appendix D.

1.18    "Trademarks" means the trademarks owned or licensed and designated by
        Ligand for the Products in Appendix C, as well as any substitute marks
        that are used for the Products in accordance with Clause 12.2.

2.      GRANT OF RIGHTS

2.1     Distribution Rights: Subject to the terms and conditions of this
        Agreement, Ligand grants to Distributor, and Distributor accepts, the
        exclusive right to market the Products in the Territory. Right to market
        under this Agreement shall mean the Distributor's right (1) to hold
        itself out as Ligand's exclusive authorized distributor in the
        Territory; (2) to acquire the Products from Ligand for resale to
        customers on its own account in the Territory; and (3) to appoint
        Affiliates of Distributor or other third parties (deemed) approved by
        Ligand as Dealers in the Territory; provided, however, that (a)
        Distributor shall obtain an executed copy of a sub-distributor or dealer
        agreement, in a form containing terms and conditions substantially
        similar to the terms and conditions of this Agreement, from the relevant
        Dealer; and (b) Distributor shall notify Ligand in writing of the
        desired appointment of any third party Dealer and, at Ligand's request,
        provide Ligand with adequate background information on such Dealer.
        Unless Ligand reasonably objects to such appointment within thirty
        calendar days after its receipt of such notice and information, Ligand
        shall be deemed to have given the requisite approval to the appointment.

2.2     Additional Rights: Ligand further grants Distributor the royalty-free
        and (except as to Ligand) exclusive right to use the Confidential
        Information, the assistance and information related thereto pursuant to
        Clause 4.4, and the Trademarks solely to the extent reasonably necessary
        for the distribution and marketing of the Products within the Territory
        in accordance with this Agreement.

2.3     Independent Contractors: The relationship of Ligand and Distributor
        established by this Agreement is of seller and buyer, or independent
        contractors, and nothing in this Agreement shall be construed: (1) to
        give either party the power to direct or control the daily activities of
        the other party, or (2) to constitute the parties as principal and
        agent, partners, or otherwise as participants in a joint undertaking.
        Ligand shall have no obligation or authority, express or implied, to
        exercise any control whatsoever over the employees or the business
        affairs of Distributor. Except as specifically provided in this
        Agreement, Distributor shall have no power or authority to make or give
        any representation or warranty or to incur any liability or obligation,
        or to waive any right, on Ligand's behalf.

2.4     Ligand's Rights: Ligand reserves the right to modify and/or to
        discontinue developing or producing the Products at its discretion at
        any time either (1) due to legal or regulatory requirements,
        administrative or court orders, or safety risks, or (2) so long as the
        Product in question is also withdrawn from the European or the North
        American market for a justified and reasonable motive; provided,
        however, that Ligand shall notify Distributor as soon as


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        practicable after any such modification or discontinuance and that
        Distributor shall be entitled to market any modified versions of
        Products pursuant to the terms of this Agreement. Nothing in this
        Agreement shall be deemed to restrict Ligand from selling the Products
        or other products to Persons outside the Territory for use within the
        Territory, nor from appointing distributors in countries outside the
        Territory who may be permitted, by operation of law, to sell the
        Products in the Territory, and Distributor shall receive no compensation
        for such sales by Ligand or any other distributor; provided, however,
        that Ligand shall impose upon its other distributors restrictions on
        their active marketing of the Products in the Territory equivalent to
        restrictions placed upon Distributor's active marketing of Products
        outside the Territory in this Agreement, to the extent such restrictions
        are legally permissible.

2.5     Ligand Exclusive Supplier: During the Term, Distributor shall purchase
        all of its requirements of the Products from Ligand or any party
        designated by Ligand for this purpose.

3.      TERM

3.1     Term: The term of this Agreement shall commence on the Effective Date
        and shall continue, with respect to a particular Product, for a period
        of ten years from the date of first sale of that particular Product to
        Distributor anywhere in the Territory after the Product Authorization is
        obtained for such Product, unless the Agreement is earlier terminated in
        accordance with Clause 16.

3.2     Extensions: Ligand and Distributor agree that, at least one year before
        the expiration of the initial ten-year term of the Agreement, they shall
        engage in good faith discussions for a period not to exceed six months
        concerning the extension of the term of the Agreement for the relevant
        Product(s) for a period of three to five years at commercial terms and
        conditions to be negotiated during the six month discussion period.

4.      AUTHORIZATIONS

4.1     Distributor to Use Diligent Efforts to Apply for and Pursue Product
        Authorizations: Following the issuance of any Product Authorization by
        the FDA, the EMEA, or any other Governmental Authority and in
        consultation with Ligand, Distributor shall be responsible for, and
        shall use diligent efforts to, file applications for, pursue and
        maintain, in each country within the Territory, during the Term, all
        Product Authorizations. All Product Authorizations shall be in Ligand's
        name, whenever legally permissible, unless otherwise agreed to by
        Ligand. Distributor shall obtain Ligand's prior approval of all
        applications and submissions to any Governmental Authority in respect of
        any Product Authorization. Distributor shall keep Ligand informed, in
        writing, of the status of its applications for Product Authorizations on
        a regular basis, and in any event no less frequently than once every
        three months, and shall immediately notify Ligand in writing of any
        substantial change in the status of any Product Authorization or any
        substantive questions received from any Governmental Authority in
        respect of such Product Authorizations. Distributor


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        shall provide copies of all Product Authorizations to Ligand at its
        request. If at any time there is a choice in respect of the appropriate
        type of such Product Authorization to be obtained or maintained in
        respect of any one or more of the Products, Ligand may, in its sole and
        absolute discretion, exercise such choice and shall direct Distributor
        as to the appropriate Product Authorization to be requested. If Ligand,
        at its sole discretion, informs Distributor that it does not intend to
        apply for any requisite Product Authorization in any country in the
        Territory, Distributor may give Ligand written notice of its intention
        to seek such Product Authorization on its own and shall have the right
        to do so, unless Ligand proceeds with or authorizes the filing on its
        behalf within thirty calendar days after its receipt of Distributor's
        notice. In any given case when Distributor seeks Product Authorization,
        Ligand shall provide Distributor with all reasonably necessary and
        available clinical data, documentation and assistance to such effect.

4.2     Distributor to Apply for Approvals: Distributor, at its cost, shall file
        applications for and maintain Approvals for all Products listed on
        Appendix A in effect as of the Effective Date in each country in the
        Territory during the Term. If Distributor believes that any application
        for Approval for any particular future Product or indication that may be
        included within the scope of this Agreement is not economically
        justified, Ligand may proceed with the application at its own cost and,
        upon issuance of the Approval, Distributor shall market the Product in
        the country concerned, if Ligand so requests. Distributor shall
        immediately notify Ligand in writing of any substantial change in the
        status of any Approval or any substantive questions received from any
        Governmental Authority in respect of such Approvals. Distributor shall
        provide copies of all Approvals to Ligand.

4.3     Pricing Approvals: Without limiting the generality of Clause 4.2, any
        applications, submissions, negotiations and agreements with any
        Governmental Authority on Product prices will require Ligand's prior
        consent provided, however, that Ligand shall give its consent if the
        price from the Distributor to the wholesalers in the relevant country of
        the Territory is not less than ***percent of the price as determined by
        the Spanish Governmental Authorities ("Precio de Venta Laboratorio").

4.4     Ligand to Provide Assistance: Ligand shall provide such assistance as
        Ligand may deem reasonably necessary to Distributor in respect of
        Distributor's Product Authorization and Approval obligations under
        Clauses 4.1, 4.2 and 4.3, and in particular shall provide:

        (a)    written materials and information concerning the Products,
               including copies, or summaries, of materials prepared for
               submission to the United States and Europe (or, at Ligand's
               discretion, Central or South American) Governmental Authorities
               concerning the Products or their labeling, to the extent that
               Ligand is legally and contractually permitted or required to do
               so, for Distributor's use in obtaining Product Authorizations in
               respect of each of the Products; and

        (b)    access to such clinical data and documentation in respect of the
               Products generated by research and trials funded by Ligand or to
               which Ligand may have access with

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               the right to disclose, as Ligand may deem reasonably necessary,
               to be relevant and useful to Distributor in obtaining Product
               Authorizations in respect of each Product.

4.5     Distributor to Bear Costs: Subject to Clauses 4.1 and 4.6 below,
        Distributor shall be responsible for all costs and expenses associated
        with filing for and maintaining Product Authorizations and Approvals,
        including, without limitation, the Base Price of Product supplied by
        Ligand and the costs of any clinical trials conducted by or on behalf of
        Distributor for the purposes of any Product Authorizations, unless
        otherwise agreed in writing between the parties prior to such costs
        being incurred.

4.6     Clinical Trial Program: The parties agree to jointly evaluate the merits
        of a clinical trial program for one or more of the Products for severe,
        recalcitrant, plaque psoriasis vulgaris.

4.7     No Marketing of Products without Product Authorizations: Except to the
        extent permitted by law and as may be agreed in writing between the
        parties, Distributor shall not market, promote, offer for sale or sell
        any one of the Products unless and until Distributor obtains the
        appropriate Product Authorizations in respect of such Product. In the
        event that Distributor is legally permitted, due to an individual
        pre-approval in respect of any Product, to market any Product prior to
        obtaining the relevant Product Authorization, Distributor shall not do
        so without obtaining the prior written consent of Ligand, which will not
        be unreasonably withheld.

5.      ORDERS AND FORECASTS

5.1     Forecasts: In order to permit Ligand and its suppliers to allocate their
        manufacturing capacity, Distributor shall provide Ligand with written
        4-quarter rolling forecasts of its Product requirements. Such forecast
        shall be broken down by Product, quantities, and shipping dates, and
        shall be delivered to Ligand not later than one hundred twenty days
        prior to the beginning of each calendar quarter (commencing after
        Distributor has obtained the first Product Authorization and Approval in
        respect of any Product). Ligand shall either accept or reasonably reject
        such forecasts within thirty days after receipt. Any forecast accepted
        by Ligand or not rejected within that period shall be binding on the
        Parties as follows: Unless otherwise agreed, Distributor shall order,
        and Ligand shall supply, one hundred percent of the quantities forecast
        for the first calendar quarter and between eighty and one hundred twenty
        percent of the quantities forecast for the next quarter. Quantities
        forecasts for subsequent quarters shall be non-binding indications for
        production schedules, only, until included in subsequent quarterly
        forecasts.

5.2     Orders: Purchase of Products by Distributor hereunder shall be made only
        pursuant to written orders executed by Distributor, and shall be for a
        minimum of the Distributor's quarterly requirements for the Territory.
        The orders of Panretin(TM) Gel, Ontak(TM) and Targretin(TM) Gel shall
        separately specify the labeling requirements so as to allow Ligand to
        label those products before shipment. The orders shall be accepted in
        writing by Ligand at the offices specified in Clause 19.7. Subject to
        Clause 5.1 above, no order shall be binding upon Ligand until accepted
        by Ligand in writing. Subject to Clause 5.1 above, Ligand



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        reserves the right to accept or reject any order, offer or request for
        Products in its sole discretion. The terms and conditions of this
        Agreement shall apply to all orders placed by Distributor and shall
        override and supersede any different or additional terms on orders from
        or any general conditions maintained by Distributor. All orders must be
        received by Ligand from Distributor at least 120 days prior to the
        desired shipment date. If any order for quarters 2, 3 or 4 of a forecast
        exceeds the forecasts for that calendar quarter provided by Distributor
        under Clause 5.1 hereof by more than twenty percent (20%), Ligand shall
        use its reasonable efforts, but shall not be obligated, to ship the
        requested quantities of Products, with the normal lead time stated
        above. If the order cannot be fully shipped, Ligand will notify
        Distributor by the end of that period, and the parties will jointly
        determine an appropriate shipment schedule.

 5.3    Shipment Frequency: The Products shall be shipped at a frequency no
        greater than once per month with a minimum purchase price to Distributor
        of $ *** U.S. provided, however, that Distributor may request shipments
        at a frequency greater than once per month at the same minimum purchase
        price during the first year of the Agreement.

5.4     Inventory Requirements: Distributor shall maintain a reasonable supply
        of Products adequate to serve the appropriate customer base in each
        country of the Territory from time to time. For the first six months
        beginning with the first sale of a Product, such inventory shall be
        sufficient to cover not less than a three month supply of Ontak(TM),
        Panretin(TM) and Targretin(TM) Products based on Distributor's
        forecasts. Thereafter, the inventory may be reduced to a two months
        supply.

5.5     Cancellation and Rescheduling. Ligand will use its reasonable best
        efforts to honor any request of Distributor to reschedule shipment of
        any order accepted by Ligand. For Panretin(TM) and Targretin(TM)
        capsules, orders for bulk capsules or capsules in unlabeled bottles
        accepted by Ligand may be canceled by Distributor, provided that
        Distributor cancels the order at least forty five (45) days in advance
        of the shipment date and pays a cancellation charge equal to *** of the
        order price. No cancellation shall be allowed for any other Products
        once a firm order has been accepted by Ligand.

5.6     Terms of Shipment and Transfer of Title. All shipments of Products shall
        be made in Ligand's standard shipping packages CIF Distributor's
        designated port of entry in Spain or such other port of entry agreed
        upon by the parties. Unless otherwise agreed in writing between the
        parties, Ligand shall select the method of shipment and the carrier, and
        Distributor shall be responsible for all actions and documents necessary
        to obtain clearance to import the Products into the Territory. Ligand
        shall retain title to the Products until full payment of the Base Price
        for the Products is irrevocably credited to Ligand's bank account, and
        Distributor shall store all Products in its facilities so that they are
        readily identifiable as Ligand's Products.

5.7     Product Availability. Ligand will use its reasonable efforts to deliver
        to Distributor the

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        Products in the quantities and at the dates specified on the orders
        submitted by Distributor and accepted by Ligand; provided, however, that
        Ligand (1) reserves the right to allocate the Products equitably among
        its customers in the event of a shortage of any Products; and (2) shall
        not be liable to Distributor for any delay in delivery without Ligand
        being at fault.

6.      REGISTRATION SERVICES AND PAYMENTS

6.1     Initial Service Reimbursement: On execution of this Agreement
        Distributor shall make a non-refundable initial payment to Ligand in the
        sum of US$ *** as reimbursement for services rendered in the
        registration of the Products in the Territory.

6.2     Additional Service Reimbursement : On either (a) the date on which
        Distributor obtains the first Product Authorization for Panretin or
        Targretin, but not for Ontak, in any country in the Territory; or (b)
        September 30, 1999, whichever is the earlier, Distributor shall make a
        non-refundable payment to Ligand in the sum of US$ *** as reimbursement
        for services rendered in the registration of the Products in the
        Territory.

6.3     [Reserved]

6.4     Product Pricing: Ligand shall supply the Products CIF to the port of
        entry designated pursuant to Clause 5.6. For all Products supplied,
        Distributor shall pay to Ligand the Base Price. All payments under this
        Agreement shall be made in United States dollars. Where payment must be
        converted into U.S. dollars from another currency, the conversion shall
        be made based on the applicable exchange rate as published on the
        European Central Bank's Web Site for the date of Ligand's invoice.

6.5     Payment of Base Price: Unless otherwise agreed in writing by Ligand,
        Distributor shall pay the invoiced estimated Base Price for each order
        of Products under this Agreement within forty-five calendar days' net by
        international wire transfer to the bank identified by Ligand from time
        to time. If Distributor at any time has become delinquent, Ligand shall
        have the right to make sales contingent upon Distributor's payment by
        irrevocable letter of credit confirmed by a major US merchant bank and
        payable in United States Dollars (US$) by draft at sight against
        delivery of bill of lading (which may be marked "freight collect" and
        which shall permit transshipments and partial shipments), commercial
        invoice and packing list.

6.6     Payment Reconciliation: Within ninety (90) days of the end of each
        calendar quarter (commencing after Distributor has made the first sale
        of any Product), the amounts paid by Distributor to Ligand under Clause
        6.5 shall be adjusted as follows:

        (a)    Distributor or Ligand, as the case may be, shall pay or credit to
               the other, the amount, if any, by which the estimated Base Prices
               paid by Distributor to Ligand under Clause 6.5 differ from the
               Base Prices payable by Distributor after deducting the
               deductions, not to exceed 5% of the Precio de Venta Laboratorio,
               actually paid or charged against Distributor pursuant to Clause
               1.14 during that quarter.


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6.7     Late Payments: Whenever a late payment is due to a cause attributable to
        a party, all amounts not paid to the other party when due shall accrue
        interest daily at the lesser of an annual rate of twelve percent (12%)
        or the highest rate permissible by law on the unpaid balance until paid
        in full.

6.8     Taxes. All amounts payable to Ligand under this Agreement are exclusive
        of any income, sales, use, property, ad valorem, value added or other
        taxes, levies, imposts, duties, charges or withholdings of any nature
        (collectively, "Taxes"), arising out of any transaction contemplated by
        this Agreement and imposed against Distributor or the Products by any
        taxing authority in the Territory (excluding, however, any Taxes on, or
        measured solely by, the net income of Ligand and Taxes imposed on Ligand
        in the United States). Distributor shall pay all applicable Taxes or
        provide Ligand with a certificate of exemption acceptable to the
        relevant taxing authority, and shall also be liable for all bank charges
        levied in connection with payments made to Ligand (excluding, however,
        any bank charges levied by Ligand's bank). In the event that any
        payments to Ligand under this Agreement are subject to any withholding
        taxes, Distributor shall promptly provide all tax certificates,
        applications and related documents to Ligand. If Ligand is required to
        pay any Taxes in the Territory, other than Taxes imposed upon the
        payments under Clause 6.1 or 6.2, Distributor shall promptly reimburse
        Ligand upon written request therefor.


7.      MARKETING AND PROMOTION

7.1     Marketing Plans: At least six (6) months prior to the anticipated date
        on which the relevant Product Authorization and Approval shall be issued
        in respect of each Product, Ligand and Distributor shall consult in good
        faith to determine an appropriate marketing plan in respect of each
        Product for the Territory. All such marketing plans shall be harmonized
        with, and shall not prejudice, Ligand's global and regional marketing
        strategies covering the Territory. Distributor shall be responsible for
        implementing such marketing plans and for advertising and promoting each
        Product within the Territory from the dates on which it obtains the
        relevant Product Authorization and Approval for each Product.
        Distributor shall at all times adhere to the policies set by Ligand in
        the execution of mutually agreed upon annual marketing plans for the
        Products, including any marketing plans which Ligand wishes to implement
        among its distributors in other territories and which are set by Ligand
        and agreed to by Distributor in good faith provided, however, that
        Distributor, at its sole discretion (but in accordance with any relevant
        Approvals in the Territory in respect of pricing), may determine the
        resale prices for the Products and the terms and conditions of
        distribution.

7.2     Marketing Materials. In the promotion and marketing of the Products,
        Distributor shall develop sales literature and promotional materials
        provided to Distributor by Ligand pursuant to Clause 7.3. Distributor
        shall have the right to prepare other product descriptions and other
        promotional and marketing materials relating to the Products; provided
        however,



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        that (1) all costs and expenses incurred by Distributor in the
        preparation and distribution of such product descriptions and other
        promotional and marketing materials shall be borne solely by
        Distributor; and (2) all such product descriptions and other promotional
        and marketing materials shall not be released by Distributor until
        approved in writing by Ligand, such approval not to be unreasonably
        withheld. Distributor shall submit samples of final copy for all key
        product descriptions and other promotional and marketing materials it
        proposes to use in respect of the Products for Ligand's approval within
        sixty (60) days prior to the first date of anticipated use of such
        materials. Ligand shall use its reasonable efforts to respond to any
        such request for approval within thirty (30) days of its receipt
        thereof. If no written response is given by Ligand denying such request
        within the aforesaid term, then Ligand's approval shall be deemed
        granted.

7.3     Product Literature: To the extent that it is legally and contractually
        permitted to do so, Ligand will share with Distributor samples of
        product descriptions, sales aids and advertising and promotional
        materials developed and used by Ligand, its other distributors or
        licensees (collectively "Promotional Materials") in respect of each
        Product as soon as practicable. Distributor shall bear all costs of
        reproducing and/or adapting such Promotional Materials for use within
        the Territory, and shall not use any adaptations of such Promotional
        Materials without Ligand's prior approval of such adaptations. Likewise,
        Distributor agrees to share samples of its Promotional Materials with
        Ligand and Ligand's other distributors and licensees.

7.4     Rights to Reproductions: All translations, reproductions, adaptations
        and creations of derivative works of all of Ligand's Promotional
        Materials (collectively "Reproductions") created by Distributor will be
        created as "works made for hire" with Ligand as the hirer, and copyright
        and all other proprietary rights in all of the Reproductions shall vest
        in Ligand from the date of completion thereof by Distributor. To the
        extent that any Reproductions do not qualify as "works made for hire",
        then Distributor hereby assigns to Ligand all copyrights and all other
        proprietary rights in the Reproductions to Ligand. In this event,
        Distributor will, at Ligand's request, execute any assignment or "work
        made for hire" documents and shall take all other steps as necessary or
        appropriate to perfect copyrights and all other proprietary rights in
        the Reproductions in the name of Ligand. If, notwithstanding the
        foregoing, Ligand, for any reason, is deemed not to own all rights,
        title, and interest in and to the Reproductions, Distributor shall be
        automatically considered to have granted to Ligand a royalty-free,
        perpetual and transferable license to use, distribute, translate and
        reproduce the Reproductions. Such license shall be exclusive to Ligand
        and shall survive the expiration or termination of this Agreement for
        any reason whatsoever.

7.5     Sales Assistance: Whenever Ligand considers it reasonably necessary in
        order to maintain or increase the volume of sales of Products in the
        Territory, Ligand shall be entitled to send, at its own cost,
        representatives to visit Distributor or Distributor's customers or
        prospective customers. Ligand shall keep Distributor informed of
        promotional methods and techniques used by Ligand in respect of the
        Products.


                                       11
<PAGE>   12

8.      OBLIGATIONS OF DISTRIBUTOR

8.1.    Diligent Efforts: Distributor shall use its diligent efforts to market
        and sell the Products within the Territory at its own expense, including
        but not limited to professional sales calls on target medical audiences
        (e.g. physicians, hospitals, pharmacists, etc.), advertising the
        Products in appropriate media and participating in trade shows,
        conferences, expositions, and promotional seminars, all with due
        consideration for the local marketing environment in the Territory.
        Distributor shall conduct its marketing activities in a lawful manner
        with the highest standards of pharmaceutical product promotional
        practices, fair trade, fair competition, and business ethics, and shall
        cause its employees and Dealers to do the same.

8.2.    Offices and Personnel. Distributor shall maintain offices adequate to
        market and support the Products in the Territory and shall retain and
        have at its disposal at all times an adequate staff of trained and
        qualified personnel to perform its obligations under this Agreement.

8.3.    Dealers: Distributor may only appoint Affiliates or other third parties
        pursuant to the terms and conditions set forth in Clause 2.1. Any such
        appointment shall be made in writing and only in the name and for the
        account of Distributor, and shall terminate upon the expiration,
        non-renewal, or termination of this Agreement for any reason; provided,
        however, that:

        (a)    Distributor shall not undertake to grant to any Dealer any rights
               greater than those which are granted by Ligand to Distributor
               under this Agreement;

        (b)    In order to protect the goodwill of Ligand and the Products in
               the Territory, Distributor shall secure the agreement of each and
               every Dealer that it shall assume the same obligations as have
               been assumed by Distributor under this Agreement; and

        (c)    Distributor shall defend, indemnify and hold Ligand harmless
               against any claim, loss, liability or expense (including
               attorney's fees and court costs) arising out of or based upon (1)
               any act or omission of any Dealer, or (2) any claim made by any
               Dealer against Ligand.

8.4.    Alterations: Distributor shall ensure that the Products are distributed,
        sold, and advertised in the form and with the labeling or marking
        designated by Ligand and in accordance with the applicable regulations
        in the Territory and, in particular, shall not alter, remove, or deface
        any Trademark. Distributor acknowledges that it shall have no right to
        sell any products under Ligand's name or trademark if they were not
        originally manufactured or supplied by, or on behalf of, Ligand.

8.5.    Clinical Evaluations: Prior to conducting any clinical evaluation of any
        of the Products, Distributor shall furnish to Ligand, for its prior
        review and written approval, the protocols for such evaluation written
        in the English language. Ligand shall use its reasonable efforts to
        respond to any such written request for approval within ninety (90) days
        of its receipt thereof, granting its approval or, if duly and reasonably
        justified, denying it. If no written notice is given by Ligand denying
        its approval within the aforesaid term, then Ligand's



                                       12
<PAGE>   13

        approval shall be deemed granted. Results from any such clinical
        evaluation shall not be publicly disclosed or disclosed in confidence to
        any third party without Ligand's prior written approval, such approval
        not to be unreasonably withheld.

8.6     Insurance. Both parties shall obtain and at all times during the term of
        this Agreement maintain, and bear the cost of, liability insurance
        which, in the judgment of Ligand, is adequate to cover their respective
        obligations under this Agreement. A certificate of insurance and any
        other documentation necessary to prove compliance with this provision
        will be provided to the other party upon request.

9.      REPORTING OBLIGATIONS

9.1     Foreign Laws and Regulations: In addition to its obligations under
        Clauses 4.1, 4.2 and 4.3 to provide Product Authorization and Approval
        information, Distributor shall advise Ligand of any legislation, rule,
        regulation or other law (including but not limited to any customs, tax,
        foreign exchange or foreign trade, antimonopoly, pharmaceutical products
        or intellectual property law) which is in effect or which may come into
        effect in the Territory after the date of this Agreement and which may
        affect the importation of the Products into the Territory or the use of
        the Products or the protection of Ligand's Intellectual Property Rights
        therein.

9.2     Record Keeping: At all times during the term of this Agreement,
        Distributor shall maintain at its principal place of business full,
        complete and accurate books of account and records with regard to its
        activities under this Agreement, including, without limitation, records
        of all sales of the Products including the names of customers to whom
        Products are sold and total gross sales and net sales for each calendar
        quarter. Upon reasonable notice, and not more than twice a year,
        Distributor shall grant Ligand or its representatives access during
        normal business hours to any premises of Distributor in order that
        Ligand, at its expense, may inspect Distributor's books and premises
        related to the Products for the sole purpose of verifying and enforcing
        compliance by Distributor with its obligations under this Agreement;
        provided, however, that Distributor shall reimburse Ligand for the full
        amount of the inspection costs if any inspection under this Clause 9.2
        reveals any substantial breach by Distributor of this Agreement,
        provided that Ligand shall have the burden of establishing any such
        substantial breach.

9.3     Reports: Distributor shall provide Ligand with quarterly operation
        reports of Distributor's activities to register, develop and market the
        Products in the Territory, and shall provide to Ligand copies of all
        such reports received by Distributor from Dealers. Each such report
        shall be due within thirty (30) days after the end of the period to
        which it relates. Each report shall include:

        (a)    a monthly compilation of all Products distributed by Distributor,
               including the revenues derived therefrom and a breakdown of the
               prices charged in respect of each Product; and


                                       13
<PAGE>   14

        (c)    a monthly list of the amount of inventory on hand; and

        (d)    monthly gross and net sales on a per Product, per country basis
               in local currency and U.S. dollars, using the average exchange
               rate set forth in the European Central Bank's Web Site for the
               month.

9.4     Annual Statements: Distributor shall provide Ligand with annual
        statements within thirty (30) days after the end of each calendar year
        showing annual sales figures and the amount of inventory on hand as at
        December 31 of each year, and shall provide to Ligand copies of all such
        annual statements received by Distributor from Dealers. Such annual
        statements shall also contain a summary of all promotional activities
        undertaken by Distributor with respect to the Product during the
        preceding calendar year, and current credit references.

9.5     Exchange of Adverse Event Information: The recipient of Adverse Event
        (AE) reports and/or data, either Distributor or Ligand, will mutually
        exchange and promptly provide in writing, using the latest applicable
        International Conference on Harmonization of Technical Requirements for
        Registration of Pharmaceuticals for Human Use (ICH) and Council for
        International Organizations of Medical Sciences (CIOMS) guidelines for
        reporting, any adverse event information obtained by the receiving party
        associated with the use of the Products either as a result of marketed
        use or from investigational clinical trials:

        (a)    Without limiting the foregoing, the party that is the original
               recipient of AE information relating to incidents of serious and
               unexpected reactions and/or events associated with the use of any
               of the Products, as defined by the ICH and/or CIOMS guidelines,
               shall make an initial written report of that information to the
               other party, via facsimile, not more than 72 hours following
               receipt of that information. A full written report, following the
               content and format guidelines indicated in the applicable current
               ICH and CIOMS guidelines, is to be sent to and received by the
               other party within seven (7) days following the date the initial
               recipient receives such AE information.

        (b)    Distributor shall also provide Ligand with routine quarterly and
               annual adverse event reports and/or safety data received from any
               source in the Territory, using the ICH guidelines for the content
               and format for these types of reports. These reports are intended
               to be used for and incorporated into Periodic Safety Update
               Reports [PSUR] as defined by ICH guidelines. Ligand will provide
               a copy of each of the Products' complete PSUR to the Distributor
               within five (5) days of submission of the applicable Product's
               PSUR to the U.S. regulatory authorities.

        (c)    Distributor shall be responsible for submitting the adverse
               event/ medical safety (safety surveillance) reports in the
               countries of the Territory as required by the regulatory
               authorities. Ligand will hold and maintain the Central AE/ safety
               database for the Products and reports based on this database, as
               necessary to meet the requirements of regulatory authorities in
               the Territory, will be made available



                                       14
<PAGE>   15

               to Distributor during the agreement life. Without limiting the
               generality of the foregoing, Distributor shall cooperate with
               Ligand for the development of standard operating procedures for
               exchange of information concerning Adverse Events and Product
               safety information derived from Products use in the Territory and
               each party shall at all times comply with the procedures so
               developed.

        (d)    For all of the reports specified above, the language of all
               exchange between and among the Parties will be English.
               Distributor will provide Ligand all of the above-required AE
               reports to the following address:

               Ligand Medical Safety
               Ligand Pharmaceuticals Inc.
               10275 Science Center Drive
               San Diego, California  92121   U.S.A.
               Tel: 1 (619)  550-7588
               Fax: 1 (619)  550-1860

               Ligand will provide Distributor all of the above-required AE
               reports to the following address:

               Ferrer Group
               Pharmacoepidemiology and Safety
               Medical Department
               Gran Via Carlos III, 86
               08028 Barcelona   Spain
               Tel: +34 93 330 61 11
               Fax: +34 93 490 70 78

9.6     Recall Procedures: Ligand will provide Distributor with a copy of
        Ligand's standard operating procedure for recalls of products.
        Distributor acknowledges the importance of the development and the
        observance of correct procedures in case of recalls. Distributor shall
        cooperate with Ligand for the development of recall standard operating
        procedures and shall at all times comply with the procedures so
        developed and adhere to Ligand's instructions from time to time and
        always in accordance with mandatory requirements applicable in the
        Territory.

10.     PRODUCT AUTHORIZATIONS

10.1    Distributor acknowledges that Ligand cannot and does not guarantee the
        issuance of any Product Authorization for any or all of the Products in
        any country in the Territory.

11.     COVENANTS OF DISTRIBUTOR

11.1    Restrictions: To the extent permissible by law, Distributor is
        prohibited from:




                                       15
<PAGE>   16

        (a)    Advertising, circulating price lists or otherwise soliciting
               orders for the Products, and from establishing or maintaining
               branches, sales offices or distribution depots, outside the
               Territory for the distribution of the Products;

        (b)    During the term of this Agreement, seeking the Approval for, or
               marketing, (a) any products of a third party for a registration
               indication of CTCL or, (b) any oral or topical product of a third
               party for a registration indication of Kaposi's Sarcoma, except
               as agreed by the parties.

12.     INTELLECTUAL PROPERTY RIGHTS

12.1    Acknowledgment: Distributor acknowledges Ligand's exclusive right, title
        and interest in and to any and all Intellectual Property Rights
        pertaining to the Products. Distributor shall not at any time during or
        after the term of this Agreement take any act or step impairing the
        Intellectual Property Rights or do anything that may otherwise adversely
        affect the Intellectual Property Rights, provided that any good faith
        legal challenge shall not be deemed to be such an act or step.

12.2    Notices, Trademarks and Name. Distributor shall have the royalty-free
        and (except as to Ligand) exclusive right to use in the Territory, and
        shall use where available, the trademarks in Appendix C designated by
        Ligand for each Product. If no trademark in Appendix C is available for
        a Product in a country of the Territory and Ligand is unable or elects
        not to provide an alternative trademark, then Distributor shall have the
        right to secure, in Ligand's name and for its benefit, trademark rights
        to a substitute mark for the Products in the relevant country and Ligand
        will reimburse Distributor for the pre-approved expenses of securing
        such rights. The rights to the substitute mark shall remain with the
        Product it is used for and shall be transferred accordingly in the event
        that corresponding Product rights are transferred. Distributor shall not
        alter, deface, remove, cover, mutilate, or add to, in any manner
        whatsoever, any patent notice, copyright notice, trademark, trade name,
        serial number, model number or brand name that Ligand may attach or
        affix to the Products. Distributor shall not market the Products under
        any name, sign or logo other than the Trademarks approved by Ligand.
        Distributor may use the Trademarks solely in connection with the
        distribution of the Products and in accordance with Ligand's
        instructions and quality control standards from time to time, and will
        execute any document reasonably requested by Ligand in connection with
        the use and maintenance of the Trademarks in the Territory. Distributor
        acknowledges and agrees that it shall not have any rights in respect of
        the Trademarks except to the extent expressly granted in this Agreement,
        and that all use of the Trademarks in the Territory and all goodwill in
        the Trademarks shall inure to the benefit of Ligand.

12.3    Third Party Claims: Distributor shall promptly notify Ligand of any
        claims or objections that its use of the Intellectual Property Rights in
        connection with the marketing, support or service of the Products may or
        will infringe the copyrights, patents, trademarks or other proprietary
        rights of another Person ("Third Party Claim"). If Distributor is served
        with a legal action or otherwise forced to respond in a legal proceeding
        due to a Third Party Claim,




                                       16
<PAGE>   17

        Distributor shall (1) without delay, tender the defense of such Third
        Party Claim to Ligand; and (2) render Ligand all reasonable assistance,
        at Ligand's expense, in connection with the defense of any such third
        party claim or objection, whether in the courts, before administrative
        agencies, or otherwise. If Ligand refuses to assume the defense of a
        Third Party Claim, Distributor shall have the right to defend itself
        against such Third Party Claim, in which case Ligand shall render
        Distributor all reasonable assistance, at Ligand's expense. Distributor
        shall not, except as required by law, knowingly make any admission to
        jeopardize, compromise or otherwise limit the validity of Intellectual
        Property Rights.

12.4    Infringement of Intellectual Property Rights: Distributor shall promptly
        notify Ligand of any infringement or suspected infringement of
        Intellectual Property Rights in the Territory relating to the Products
        of which it becomes aware, and provide Ligand with any available
        evidence of such infringement or suspected infringement.

        (a)    Enforcement by Ligand: Ligand, at its option, shall be entitled
               to institute enforcement proceedings ("Enforcement Proceedings")
               in respect of any infringement or unauthorized use of
               Intellectual Property Rights in the Territory. Distributor agrees
               to provide all reasonable co-operation and assistance to Ligand
               in relation to any such Enforcement Proceedings (and agrees to be
               named as a party if legally required). Any reasonable fees and
               costs borne by Distributor shall be reimbursed by Ligand. Ligand
               shall be entitled to deduct its reasonable expenses in relation
               to such Enforcement Proceedings (including reasonable attorney's
               fees and expenses and reimbursements to Distributor) from any
               recovery and any remaining amount shall be distributed pro rata
               among the parties in which Distributor shall receive 50% of any
               remaining recovery and Ligand shall receive 50% of any remaining
               recovery.

        (b)    Enforcement by Distributor: If, after six (6) months of receipt
               of credible evidence of infringement or unauthorized use of
               Intellectual Property Rights in the Territory or such lesser
               period of time if further delay would result in a loss of right
               to bring an Enforcement Proceeding, Ligand elects not to
               institute or continue an already instituted, Enforcement
               Proceeding then Distributor, using attorneys of Distributor's
               choosing reasonably acceptable to Ligand, can undertake or
               continue such Enforcement Proceeding at Distributor's expense. In
               such event, Distributor shall keep Ligand fully and timely
               informed of the action so as to enable Ligand to provide input
               which Distributor shall reasonable consider. Distributor may not
               enter into any settlement agreement or consent to judgement
               relating to the invalidity, unenforceability or noninfringement
               of the Intellectual Property Rights without Ligand's prior
               written consent. Ligand agrees to provide all reasonable
               co-operation and assistance to Distributor in relation to any
               such Enforcement Proceeding at Distributor's expense and agrees
               to be named as a party in any Enforcement Proceeding. Any
               reasonable fees and costs borne by Ligand shall be reimbursed by
               Distributor. If Distributor enforces Intellectual Property Rights
               in the Territory in accordance with this paragraph, Distributor
               shall be entitled to deduct its reasonable expenses in relation
               to such Enforcement Proceeding (including reasonable



                                       17
<PAGE>   18

               attorney's fees and expenses and reimbursements to Ligand) from
               any recovery and any remaining amount shall be distributed pro
               rata among the parties in which Distributor shall receive 50% of
               any remaining recovery and Ligand shall receive 50% of any
               remaining recovery.

13.     NON-DISCLOSURE OF CONFIDENTIAL INFORMATION

13.1    Non-Disclosure Obligations: During the term of this Agreement, the
        Disclosing Party will disclose certain Confidential Information to the
        Receiving Party to permit the Receiving Party to perform its obligations
        under this Agreement. The Receiving Party shall refrain from using or
        exploiting any and all Confidential Information for any purposes or
        activities other than those expressly authorized in this Agreement. The
        Receiving Party agrees that such Confidential Information shall be kept
        secret by the Receiving Party during the term of this Agreement and
        after the expiration hereof. The Receiving Party shall disclose
        Confidential Information only to its agents, representatives or
        employees with a need to know and shall implement appropriate security
        measures in order to avoid the disclosure or misappropriation of such
        Confidential Information.

13.2    Confidentiality Agreements: Both parties shall cause each of their
        directors, officers and employees and the directors, officers and
        employees of, respectively, Distributor's Dealers and agents, and
        Ligand's assignees, who will receive Confidential Information pursuant
        to Clause 13.1 to enter into a Confidentiality Agreement in a form
        approved by both parties. The Distributor and Ligand, respectively,
        shall at their own expense undertake the enforcement of any such
        Confidentiality Agreement in the event of any breach thereof. Execution
        of Confidentiality Agreements by the parties shall not, however, be
        construed as limiting their duties or obligations hereunder.

13.3    Ownership of Ligand's Materials. All files, lists, records, documents,
        drawings, specifications and records, whether in written or electronic
        form, which incorporate or refer to all or a portion of Ligand's
        Confidential Information shall remain the sole property of Ligand. Such
        materials shall be promptly returned (1) upon Ligand's reasonable
        request, or (2) in accordance with Clause 17.2 of this Agreement upon
        termination of this Agreement, whichever is earlier.

13.4    Exceptions. The provisions of this Clause 13 shall not apply, or cease
        to apply, to information supplied by Ligand if it (1) was already known
        to Distributor; (2) came into the public domain without breach of
        confidence by Distributor or any other Person; (3) was received by
        Distributor from a third party without restrictions on their use in
        favor of Ligand; or (4) is required to be disclosed pursuant to any
        statutory or regulatory provision or court order; provided that
        Distributor shall have the burden of establishing any of the foregoing
        exceptions.

14.     LIGAND WARRANTY, INDEMNITY, AND LIMITATIONS OF LIABILITY

14.1    Non-Infringement. To the best of Ligand's knowledge, the sale and use of
        the Products




                                       18
<PAGE>   19

        does not infringe the proprietary rights of any third party in the
        Territory, and no court proceedings or any other procedure for
        infringement of patent, copyright, trademark, trade secret or any other
        property rights have been brought against Ligand with respect to the
        Products as of the effective date of this Agreement. Ligand makes no
        warranty or representation, implied or otherwise, that the Products
        and/or their sale or use will not infringe the property rights of any
        third party in the Territory.

14.2    Products Warranty: Ligand warrants that all Products supplied hereunder
        shall (1) conform to the products specifications therefor, as published
        by Ligand from time to time consistent with the data contained in the
        Product Authorizations, and (2) have a shelf life of one year or more
        (or in the case of Ontak, nine months or more) from the date of shipment
        to Distributor. The aforementioned shelf life terms shall be
        proportionally increased from time to time in accordance with improved
        stability data.

14.3    Indemnity: Ligand shall defend, indemnify and hold Distributor and its
        shareholders, managers, officers, directors, agents and employees
        harmless against any and all losses, damages, claims, liabilities, costs
        and expenses (including reasonable attorney's fees) resulting solely
        from the personal injury or death caused by the defective design and/or
        manufacture of the Products when supplied to Distributor by Ligand or by
        Ligand's appointee, provided that Distributor promptly notifies Ligand
        in writing of any claim, action or suit potentially giving rise to the
        indemnification obligation hereunder. Ligand shall have the sole and
        absolute control of, and discretion in, the handling of the defense
        and/or settlement of any such claim, action or suit, including, without
        limitation, the selection of defense counsel, and Distributor shall
        fully cooperate with Ligand in the defense and settlement of all such
        claims, actions or suits, provided, however, that Distributor may take
        any appropriate action necessary to preserve or avoid prejudice to its
        interests, or the interests of Ligand as indemnitor, in the event that
        (1) notice to Ligand cannot be given in sufficient time for Ligand to
        take action, or (2) Ligand, after prompt notice and inquiry from
        Distributor, fails to acknowledge its obligation to indemnify
        Distributor under this clause.

14.4    DISCLAIMERS. TO THE FULL EXTENT PERMITTED BY LAW, APART FROM THE
        FOREGOING WARRANTIES AND INDEMNITY, LIGAND MAKES NO ADDITIONAL
        REPRESENTATIONS OR WARRANTIES AND HEREBY DISCLAIMS ALL WARRANTIES,
        REPRESENTATIONS, AND LIABILITIES, WHETHER EXPRESS OR IMPLIED, ARISING
        FROM CONTRACT OR TORT (EXCEPT FRAUD), IMPOSED BY STATUTE OR OTHERWISE,
        RELATING TO THE PRODUCTS AND/OR ANY PATENTS OR TECHNOLOGY USED OR
        INCLUDED IN THE PRODUCTS, INCLUDING ANY WARRANTIES AS TO
        MERCHANTABILITY, FITNESS FOR PURPOSE, CORRESPONDENCE WITH DESCRIPTION,
        OR NON-INFRINGEMENT.

14.5    LIMITATION. IN NO EVENT WILL LIGAND BE LIABLE FOR CONSEQUENTIAL,
        INCIDENTAL OR SPECIAL DAMAGES, INCLUDING ANY LOSS OF PROFITS, EVEN IF
        LIGAND HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH



                                       19
<PAGE>   20

        DAMAGES.

14.6    LIABILITY CAP. IN NO EVENT SHALL LIGAND'S LIABILITY TO DISTRIBUTOR
        EXCEED AN AMOUNT EQUAL TO THE AGGREGATE BASE PRICES PAID BY DISTRIBUTOR
        TO LIGAND FOR PRODUCTS DURING THE LAST CALENDAR QUARTER, except that
        this liability limitation shall not apply to Ligand's indemnity
        obligation under section 14.3 arising from personal injury or death
        caused by the defective design and/or manufacture of the Products when
        supplied to Distributor by Ligand or by Ligand's appointee.

15.     DISTRIBUTOR'S WARRANTIES, INDEMNITY AND LIMITATIONS OF LIABILITY

15.1    Warranties: Distributor represents and warrants to Ligand that:

        (a)    Distributor is a corporation duly organized, validly existing and
               in good standing under the laws of Spain and has the corporate
               power to execute this Agreement and to perform its obligations
               hereunder;

        (b)    the person or persons executing this Agreement on behalf of
               Distributor have been duly authorized to do so by all requisite
               corporate or other actions of Distributor;

        (c)    this Agreement is the legal, valid and binding obligation of
               Distributor, enforceable in accordance with its terms;

        (d)    the execution, delivery and performance of this Agreement by
               Distributor does not and will not conflict with or result in a
               breach of any agreement, instrument or understanding, oral or
               written, to which Distributor is a party or by which Distributor
               may be bound, nor violate any law or regulation of any court or
               Governmental Authority having jurisdiction over Distributor;

        (e)    Distributor will maintain at all times during this Agreement all
               necessary Approvals, according to Clause 4.2; and

        (f)    all Affiliates of Distributor are duly organized, validly
               existing and in good standing under the laws of the country in
               which they operate and have the power to perform all obligations
               under this Agreement that they are assigned by Distributor.

15.2    Indemnity: Distributor shall indemnify and hold Ligand and its
        shareholders, managers, officers, directors, agents and employees
        harmless against any and all losses, damages, claims, liabilities, costs
        and expenses (including reasonable attorneys' fees) resulting from any
        breach by Distributor of this Agreement so declared by a court of
        competent jurisdiction or as agreed between the parties, or resulting
        from any claim that may be made by reason of any damage caused by an act
        or omission of Distributor or any of its shareholders, managers,
        officers, directors, agents or employees whenever such act or omission
        is in connection with this Agreement, contrary to the law and is so
        declared by



                                       20
<PAGE>   21
         a court of competent jurisdiction or as agreed between the parties.


15.3    LIMITATION. IN NO EVENT WILL DISTRIBUTOR BE LIABLE FOR CONSEQUENTIAL,
        INCIDENTAL OR SPECIAL DAMAGES, INCLUDING ANY LOSS OF PROFITS, EVEN IF
        DISTRIBUTOR HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

16.     TERMINATION

16.1    Termination by Ligand: Ligand may terminate this Agreement, at its sole
        discretion: (1) in its entirety; or (2) in respect of any specified part
        of the Territory and/or any one or more of the Products only, by giving
        Distributor thirty (30) days written notice of termination, effective on
        the date such notice is received, in the event that:

        (a)    Distributor breaches any of its material obligations under this
               Agreement, and fails to cure such breach within thirty (30) days
               of receiving a written notice from Ligand specifying such breach
               and requiring it to be cured;

        (b)    Distributor takes any act or step impairing the Intellectual
               Property Rights or does anything that may otherwise adversely
               affect the Intellectual Property Rights of Ligand, provided,
               however, that Ligand may exercise its rights of termination
               pursuant to this Clause 16.1(b) whether or not the Distributor's
               legal challenge of Ligand's rights is in good faith;

        (c)    Distributor enters into insolvency or bankruptcy or is unable to
               pay its debts as they fall due, or a trustee or receiver or the
               equivalent is appointed to Distributor, or proceedings are
               instituted against Distributor in the Territory relating to
               dissolution, liquidation, winding up, bankruptcy, insolvency or
               the relief of creditors, if such proceedings are not terminated
               or discharged within thirty days;

        (d)    there is a change of control of Distributor, beyond its corporate
               structure and owners on the Effective Date, or a sale or
               disposition by Distributor to a third party other than its owners
               and companies in its corporate structure on the Effective Date of
               substantially all of its assets, without the prior written
               approval of Ligand, which approval may be given or withheld in
               Ligand's sole discretion. For the purposes of this Clause
               16.1(d), the transfer (whether direct or indirect) of all or a
               majority of the capital stock of Distributor or the merger,
               consolidation or reorganization of Distributor beyond its
               corporate structure and owners on the Effective Date shall be
               considered a "change in control" of Distributor;

         (e)   any event of Force Majeure, as defined in Clause 19.6 hereof,
               occurs and prevents Distributor from performing its obligations
               under this Agreement for a period of 90 days or more, provided
               there is no commercially reasonable alternative;



                                       21
<PAGE>   22

        (f)    Distributor ceases to carry on business in the marketing of
               pharmaceutical products in the Territory;

        (g)    any law, decree, or regulation is enacted within the Territory
               which would substantially impair or restrict (1) Ligand's right
               to terminate or elect not to renew this Agreement as herein
               provided; (2) Ligand's right, title or interest in the Products
               or the Intellectual Property Rights therein; or (3) Ligand's
               right to collect the purchase prices for the Products as set
               forth in this Agreement; or

        (h)    an adverse event occurs which has substantially impaired the
               ability of Distributor to continue to perform its obligations
               hereunder and Distributor is unable to provide Ligand with
               adequate assurance of future performance.

16.2    Termination by Distributor: Distributor may terminate this Agreement, at
        its sole discretion: (1) in its entirety; or (2) in respect of any
        specified part of the Territory and/or one or more of the Products only,
        by giving Ligand thirty (30) days written notice of termination,
        effective on the date such notice is received, in the event that:

        (a)    Ligand breaches any of its material obligations under this
               Agreement, and fails to cure such breach within thirty (30) days
               of receiving a written notice from Distributor specifying such
               breach and requiring it to be cured;

        (b)    any event of Force Majeure, as defined in Clause 19.6 hereof,
               occurs and prevents Ligand from performing its obligations under
               this Agreement for a period of 90 days or more, provided there is
               no commercially reasonable alternative;

        (c)    the Governmental Authorities have not issued the requisite
               Product Authorization or Approval for any Product for any country
               in the Territory;

        (d)    any law, decree, or regulation is enacted within the Territory
               which would substantially impair or restrict (1) Distributor's
               right to terminate or elect not to renew this Agreement as herein
               provided; (2) Ligand's right, title or interest in the Products
               or the Intellectual Property Rights therein; or (3) Distributor's
               right to market and distribute the Products in accordance with
               this Agreement; or

        (e)    an adverse event occurs which has substantially impaired Ligand's
               ability to continue to perform its obligations hereunder and
               Ligand is unable to provide Distributor with adequate assurance
               of future performance.

17.     RIGHTS AND OBLIGATIONS UPON TERMINATION/NONRENEWAL

17.1    Cessation of Rights: Upon expiration or termination (collectively, the
        "Termination") of this Agreement for any reason whatsoever as provided
        herein all rights and obligations of the parties hereunder shall cease,
        except as provided in Clauses 19.5 of this Agreement; provided, however,
        that Termination of this Agreement shall not relieve the parties hereto



                                       22
<PAGE>   23

        of any obligations accrued prior to said Termination. Distributor,
        following notice of Termination by Ligand, shall be entitled to purchase
        under the terms and conditions of this Agreement, any Products the
        orders for which were accompanied by payment and which were accepted by
        Ligand prior to the effective date of Termination, even though shipment
        of the Products may be made subsequent to the date of Termination,
        provided that Distributor has paid all outstanding obligations to
        Ligand. Upon Termination by Ligand pursuant to Clauses 16.1, Distributor
        shall immediately cease to use any advertising or promotional materials
        relating to the Products and discontinue any previously authorized use
        of the Trademarks and Confidential Information (except for activities
        permitted by the last sentence of Clause 17.3), and shall cease all
        conduct that might cause any Person to believe that Distributor is a
        distributor of the Products or otherwise connected with Ligand.

17.2    Return of Materials and Customer List: Upon Termination, Distributor
        shall promptly return to Ligand, or deliver to a third party designated
        by Ligand, and shall cause its Dealers and employees to return or
        deliver, all sales materials, Confidential Information in written,
        recorded or other tangible form and other items in Distributor's
        possession, which Ligand has furnished or supplied to Distributor, or
        which Distributor has furnished to its Dealers and employees, and all
        customer lists for Ligand Products. If Distributor purchased any such
        materials or other items, Distributor shall be reimbursed in an amount
        equal to the net price paid by Distributor for the same.

17.3    Repurchase of Inventory: Ligand shall have the option, exercisable at
        its sole discretion by written notice to Distributor within thirty (30)
        days after Termination, to repurchase all or part of Distributor's
        remaining inventory of Products. The price payable by Ligand upon the
        exercise of the option shall be the net price paid by Distributor to
        Ligand for the Products, plus the costs of re-shipment to San Diego,
        California, or to such other destination within the Territory as Ligand
        may designate. Upon receipt of Ligand's notice of exercise of its option
        pursuant to this clause, Distributor shall ship its inventory of
        Products on hand to such location as Ligand may designate. If Ligand
        does not exercise its rights under this clause, Distributor shall have
        the right to sell its existing inventory for a period of six (6) months
        following the date of Termination.

17.4    Product Authorizations, Trademarks and other Product rights: Upon
        Termination of this Agreement as provided herein for any reason
        whatsoever, Distributor shall immediately take all steps necessary to
        transfer to Ligand, or to Ligand's designee, any and all rights
        Distributor may have to Product Authorizations, Trademarks and any other
        rights associated with the Products, to the extent permitted by
        applicable law and at Distributor's cost. Distributor shall, at the time
        for application for Product Authorizations, take all reasonable steps to
        ensure that such transfers may later be completed. If such transfer is
        not possible, Distributor shall use its best efforts to arrange for
        Ligand or its designee to rely upon such Product Authorizations and
        shall permit Ligand or its designee to use and reference such Product
        Authorizations in its own applications.

17.5    Survival of Non-Disclosure Obligation: Notwithstanding the Termination
        of this Agreement, both Parties shall continue to abide by the terms of
        its non-disclosure




                                       23
<PAGE>   24

        obligations with respect to Confidential Information under Clause 12
        of this Agreement.

17.6    Waiver of Termination Compensation: Neither Party shall be liable for,
        and each Party hereby waives, all right to compensation and all claims
        of any kind whether on account of the loss by the other of present or
        prospective profits, or anticipated orders, or expenditures,
        investments, or commitments made in connection with this Agreement,
        goodwill created, or on account of any other cause whatsoever.

18.     CERTAIN PAYMENTS

18.1    No Payments: Distributor shall not make, offer or agree to offer
        anything of value to any government official, political party or
        candidate for government office. Distributor undertakes that there is
        not now nor will there be any employment of or beneficial ownership of
        Distributor by governmental or political officials in the Territory.
        Distributor will indemnify and hold harmless Ligand against any and all
        losses, costs, expenses or liabilities resulting from any breach by
        Distributor of its obligations under this Clause 18.

19.     GENERAL PROVISIONS

19.1    Waivers: The waiver by either party of a breach or default in any of the
        provisions of this Agreement by the other party shall not be construed
        as a waiver of any succeeding breach of the same or other provisions.

19.2    Entire Agreement and Amendments: This Agreement constitutes the entire
        agreement between the parties with respect to the subject matter hereof
        and supersedes all prior agreements between the parties, whether written
        or oral, relating to the same subject matter. No modification,
        amendments or supplements to this Agreement shall be effective for any
        purpose unless in writing, signed by each party.

19.3    Governing Language: This Agreement has been prepared and executed in the
        English language. No authorized translation has been prepared or
        executed. In the event that any translation is prepared, the English
        language version of this Agreement shall govern. All written
        correspondence between the parties shall be in the English language.

19.4    Further Assurances: Each party agrees to do such acts and execute such
        further documents as may be necessary or desirable to enable the
        performance of and to fulfill the provisions and intent of this
        Agreement.

19.5    Assignments: This Agreement is entered into by Ligand in reliance upon
        the facilities, personnel and technical expertise of Distributor, and
        Distributor may only transfer or delegate the performance of the
        Agreement or any part thereof to a Dealer pursuant to the terms and
        conditions of Clause 2.1. Nothing herein contained, however, shall
        prevent Ligand or Distributor from assigning this Agreement in whole or
        in part to, or causing any order or orders to be filled in whole or in
        part by, any Affiliate of Ligand or the Distributor, respectively.
        Ligand shall also have the right to assign this agreement in amerger or




                                       24
<PAGE>   25

        acquisition in which Ligand is not the surviving entity, or as part of a
        transfer of all or substantially all of the assets of its business to
        which this Agreement pertains.

19.6    Force Majeure: Neither party shall be liable to the other party for any
        delay or omission in the performance of any obligation under this
        Agreement, other than the obligation to pay monies, where the delay or
        omission is due to any cause or condition beyond the reasonable control
        of the party obliged to perform, including, but not limited to, strikes
        or other labor difficulties, acts of God, acts of government (in
        particular with respect to the refusal to issue necessary import or
        export licenses), war, riots, embargoes, or inability to obtain supplies
        ("Force Majeure"). If Force Majeure prevents or delays the performance
        by a party of any obligation under this Agreement, then the party
        claiming Force Majeure shall promptly notify the other party thereof in
        writing.

19.7    Notices: Unless otherwise specifically provided, all notices required or
        permitted by this Agreement shall be in writing and in English,
        effective upon receipt, and may be delivered personally, or may be sent
        by facsimile, commercial express courier, or first class air mail,
        postage prepaid, addressed as follows:

        If to Ligand: Ligand Pharmaceuticals Incorporated
                      10275 Science Center Drive
                      San Diego, California 92121

        Attention:     General Counsel      

        Facsimile:    (+) (1) (619) 550-1825


        If to Distributor:   Ferrer Internacional, S.A.
                             Gran Via Carlos III, 94,
                             08028 Barcelona, Spain

        Attention:           Licensing Department (cc. Legal Department)
        Facsimile:           (+) (34) (3) 330 80 57


20.     CHOICE OF LAW AND DISPUTE RESOLUTION

20.1    Choice of Law: This Agreement is governed by, and shall be construed in
        accordance with, the laws of the State of California, United States of
        America, excluding (a) conflicts of laws rules, and (b) the United
        Nations' Convention on Contracts for the International Sale of Goods.
        The parties shall endeavor to resolve amicably any and all disputes
        arising under or in connection with this Agreement, including but not
        limited to the interpretation of this Agreement, its validity and the
        performance hereunder.


                                       25
<PAGE>   26


20.2    Disputes: Any dispute between the parties relating to the validity,
        performance, interpretation or construction of this Agreement that
        cannot be resolved amicably between the parties shall be submitted to
        the exclusive jurisdiction of the courts, including the United States
        District Courts, in the State of California. Each party hereto
        irrevocably submits to the personal jurisdiction of the courts in
        California, for the resolution of all disputes hereunder.

20.3    Right to Judicial Remedies: Nothing in this Clause 20 shall be construed
        to impair or restrict either Party's right to judicial remedies,
        including preliminary and permanent injunctions from any court of
        competent jurisdiction to prevent any infringement of the Intellectual
        Property Rights, representation of competitive products, and/or
        disclosure of the Confidential Information.


IN WITNESS WHEREOF, each party has caused its duly authorized representative to
execute and deliver this Agreement in reliance on the due authority of the
representative of the other party, to be effective as of March 26, 1999.

DISTRIBUTOR:                                LIGAND PHARMACEUTICALS, INC:


By:  /s/ R. FOGUET                          By:    /s/ David E. Robinson
    ---------------------------                 ------------------------------
Title: CEO                                  Title: Chairman, President and OEO
      -------------------------                   ----------------------------

SERAGEN, INC.:

By:     /s/ Paul V. Maier          
      -------------------------
Title:         CEO                 
       ------------------------



                                       26
<PAGE>   27

                                   APPENDIX A

                                    PRODUCTS




PRODUCT                                   COVERED INDICATIONS
                                      
Panretin(TM) Gel (alitretinoin)           All indicatioNS

Panretin(TM) Capsules (alitretinoin)      All indicatioNS

Ontak(TM) (denileukin diftitox)           All indicatioNS

Targretin(TM) Gel (bexarotene)            The treatment, palliation, prevention
                                          and/or remission of cancer and
                                          dermatological diseases

Targretin(TM) Capsules (bexarotene)       The treatment, palliation, prevention
                                          and/or remission of cancer and
                                          dermatological diseases



                                     App. 1

<PAGE>   28


                                   APPENDIX B

                               BASE PRICE SCHEDULE



                            
1. Targretin(TM) products:      ***% of Resale Price.

2. Ontak(TM) products:          ***% of Resale Price.

3. Panretin(TM) products:       ***% of Resale Price.




----------
***     Portions of this page have been omitted pursuant to a request for
        Confidential Treatment and filed separately with the Commission.


                                     App. 2
<PAGE>   29


                                   APPENDIX C

                                LIGAND TRADEMARKS



Trademark             Generic Product Name                Country         Trademark Status
---------             --------------------                -------         ----------------
                                                                      
Panretin(TM)          alitretinoin                        US                    Registered
                                                          Brazil                Pending
                                                          Chile                 Pending
                                                          Colombia              Pending
                                                          Venezuela             Pending

Targretin(TM)          bexarotene                         US                    Registered
                                                          Argentina             Pending
                                                          Brazil                Pending
                                                          Chile                 Pending
                                                          Colombia              Pending
                                                          Venezuela             Pending

Ontak(TM)             denileukin diftitox                 US                    Pending

Onact(TM)             denileukin diftitox                 Brazil                Pending




                                     App. 3
<PAGE>   30


                                   APPENDIX D

                         COUNTRIES INCLUDED IN TERRITORY

*     Argentina
*     Chile
*     Uruguay
*     Paraguay
*     Bolivia
*     Brazil
*     Peru
*     Ecuador
*     Colombia
*     Venezuela
*     Guyana
*     Surinam
*     French Guyana
*     Panama
*     Costa Rica
*     Nicaragua
*     Honduras
*     El Salvador
*     Guatemala
*    Belize
*    Dominican Republic



                                     App. 4

Source: OneCLE Business Contracts.