LICENSE AGREEMENT

This Agreement is entered into between the National Technical
Information Services (NTIS), a primary operating unit of the United States
Department of Commerce, having offices at 5285 Port Royal Road, Springfield,
VA  22161, and Protein Design Labs, Incorporated (LICENSEE), a corporation,
having offices in Palo Alto, California.

WHEREAS, the United States Department of Health and Human Services has
sponsored research on malignancy and autoimmune disorders in humans and has
received by assignment certain valuable patent rights thereon in the United
States; and

WHEREAS, pursuant to 35 U.S.C. 207 and 37 C.F.R. 404 the Department of
Health and Human Services has transferred custody of the entire right, title
and interest in the patent rights to the Department of Commerce; and

WHEREAS, the Department of Commerce, pursuant to 35 U.S.C. 207 and 37
C.F.R. 404 is authorized to receive by transfer custody of the right, title
and interest in federally owned inventions; to apply for, obtain and maintain
patents on federally owned inventions in the United States and in foreign
countries; to grant nonexclusive, partially exclusive or exclusive licenses
under federally owned patents and patent applications; and to undertake all
other suitable and necessary steps to protect and administer rights to
federally owned inventions; and

WHEREAS, the Secretary of Commerce, through Department Organization
Order 30-7A, has delegated to NTIS the authority of the Secretary to acquire
federally owned inventions from other Federal agencies for the purpose of
licensing the use of those inventions in the United States; and

WHEREAS, NTIS desires, in the public interest, that the subject
invention be perfected, marketed and practiced so that the benefits are
readily available for widest possible utilization in the shortest time
possible; and

WHEREAS, LICENSEE has the facilities, personnel and expertise to bring,
and is willing to expend reasonable efforts to bring the invention to the
point of practical application at an early date.

NOW THEREFORE, in consideration of the foregoing, including the above-
cited patent licensing regulations, NTIS and LICENSEE agree as set forth
below.

                                 ARTICLE I
                                Definitions

1.1     Licensed Patent(s) shall mean issued claims in U.S. Patent
Application Serial Number 7-085,707 filed August 17, 1988 all divisions,
continuations and continuations-in-part of such patent applications, where the
making, using or selling in such continuations-in-part would be covered by a
claim in such patent applications or their divisions and all patents issuing
from such patent applications and all reissues, renewals and extensions of
such patents.

1.2     Licensed Process shall mean a method of treating T-cell mediated
disorders in humans encompassed within the scope of a claim in a Licensed
Patent.

1.3     Net Sales shall mean the amount billed or invoiced on sales of any
Product used in practicing the Licensed Process or, in the event of disposal
of any Products other than as scrap prior to its shipment from its place of
manufacture or pre-disposal storage or other than by sales, the amount billed
or invoiced for a like quantity and quality of any such Product on or about
the time of such disposal, less:
(a)      flat nine percent (9%) representing customary trade,
quantity or cash discounts and nonaffiliated brokers' or agents'
commissions; actually allowed and taken;
(a)     Amounts repaid or credited by reason of rejections or
returns; and/or
(c)     Any freight or other transportation costs, insurance
charges, duties, tariffs and all sales and excise taxes based
directly on sales or turnover or delivery of material produced
under this Agreement.

Net Sales shall not include any product used in practicing the
Licensed Process which is used for research or collaborative
research, clinical trials, donations for humanitarian purposes, or
promotional allowances or other promotional purposes.

1.4     AFFILIATE shall mean any person, corporation, firm, partnership or
other entity in which LICENSEE owns or controls at least fifty percent (50%)
of the voting stock thereof.

1.5     Licensed Territory shall mean those countries listed in the
attached Schedule and in which a Licensed Patent subsists, and any other
countries in which a Licensed Patent may be filed in the future.

                            ARTICLE II
                              Grant

2.1     NTIS hereby grants to LICENSEE and any AFFILIATES of LICENSEE's
choice, subject to the terms and conditions herein, a nonexclusive license
under the Licensed Patent(s) to make, have made, use and sell Products used in
practicing the Licensed Process and to practice the Licensed Process in the
Licensed Territory for the term of this Agreement.  LICENSEE shall notify NTIS
of any AFFILIATE included under this Paragraph 2.1.  LICENSEE may make, have
made, use and sell products used in practicing the Licensed Process and to
practice the Licensed Process in any country outside the Licensed Territory
with no obligation to NTIS if such products are both made and sold outside the
Licensed Territory; provided, however, that LICENSEE must bear all risks of
third party claims against the Licensed Patent(s) in any area outside the
Licensed Territory.


2.2     NTIS hereby grants to LICENSEE the right to grant sublicenses no
greater in scope than the license granted in Paragraph 2.1 above to
nonaffiliated companies subject to the provisions of this Agreement and to the
submission to and approval by NTIS of the proposed sublicense, which approval
shall not be unreasonably withheld.  Each sublicense shall make reference to
this Agreement and a copy of such sublicense shall be furnished to NTIS
promptly after its execution.

2.3     NTIS hereby grants to LICENSEE and its included AFFILIATES and
sublicensees the right to extend to their customers of Products used in
practicing the Licensed Process on which a maintenance and royalty fee has
been or will be paid the right to use such Products.

                              ARTICLE III
                         Royalties and Payments

3.1     Within thirty (30) days after the execution date of this Agreement
by NTIS, LICENSEE shall pay to NTIS an execution fee of [               ],
no part of which shall be refunded for any reason.

3.2     (a)     LICENSEE shall also pay to NTIS an annual maintenance fee of
[       ], no part of which shall be refunded for any reason.  The first annual
maintenance fee payment which shall be paid at the time of making the payment
required in Paragraph 3.1 above, shall be prorated for the balance of the
calendar year remaining after the effective date of this Agreement. 
Subsequent annual maintenance fees shall accrue on January 1 of each year and
shall be payable within sixty (60) days thereafter during the term of this
Agreement.  Should the ordinary and usual costs to NTIS of maintaining any
Licensed Patent(s) exceed in any year the total annual maintenance fee
received from all licensees under such Licensed Patent(s), NTIS may request
each licensee to increase its minimum annual fee for the following year by an
amount proportionate to the number of licensees, the sum of which amounts
equals such excess costs.  Should LICENSEE fail to include such increased
amount in its annual maintenance fee when due, NTIS may at its option,
terminate LICENSEE's license as to such Licensed Patents in accordance with
the provisions of Paragraph 8.2 hereof.  The annual maintenance fee paid by
LICENSEE for any given year shall be a credit against any administration and
royalty fee accrued for such year in accordance with Paragraph 3.3 below.  The
administration and royalty accrued in any one calendar year shall not be
credited against the annual maintenance fee paid or to be paid in any other
year.
(b)     Before any commitment to expend substantial funds for an
extraordinary and unusual procedure for obtaining or maintaining any Licensed
Patent(s), including but not limited to interference, reexamination, term-
extension or reissue but not including infringement or counterclaims thereto,
NTIS shall notify LICENSEE of such extraordinary and unusual procedure and the
estimated cost thereof and request LICENSEE to assume responsibility for a
proportionate share of such cost, i.e., the cost divided by the number of
licensees under the

CONFIDENTIAL TREATMENT REQUESTED

Licensed Patents.  Should LICENSEE decline to assume such
responsibility, NTIS may terminate LICENSEE's license for the country in the
Licensed Territory in which such cost would have been incurred under such
Licensed Patent(s) in accordance with the provisions of Paragraph 8.2 hereof.

3.3     LICENSEE shall pay NTIS an administration and royalty fee on the
Net Sales of LICENSEE (or its included AFFILIATES or sublicensees) of [ ], if
the entire anti-Tac monoclonal antibody, as described in U.S. Patent
Application Serial Number 7-085,707 filed August 17, 1987 (the "Antibody"), is
included in the product used in practicing the Licensed Process by Licensee,
its included AFFILIATES or sublicensees.  In the event that the licensed
Antibody or portion of it is sold as part of another protein or combination
package containing antibodies or other reagents and if, as such part, the
Antibody or a portion of it does not have a separate invoiced selling price,
then for the purpose of computing royalties, the Net Sales Price of the
Product used in practicing the licensed process shall be the net selling price
of the entire protein multiplied by the ratio of the manufacturing cost of the
antibody or portion of it to the manufacturing cost of the entire protein. 
This ratio shall be a fraction, the numerator of which shall be obtained by
counting the number of Amino Acids comprising the complementary determining
regions [as defined in E. Kabat et. al., Sequences of Proteins of Immological
interest 45,121 (1983)], of the Antibody and the denominator of which shall be
the total number of Amino Acids comprising the entire protein.

3.4     [       ] royalty fee shall be payable hereunder for direct sales of
Products used in practicing the Licensed Process by LICENSEE or its included
AFFILIATES and sublicensees to the Government of the United States of America
or on any such Product scrapped prior to shipment from its place of
manufacture.

3.5     LICENSEE agrees to submit to NTIS within sixty (60) days after
each calendar half year ending June 30th and December 31st, reports setting
forth for the preceding six (6) month period the amount of Products used in
practicing the Licensed Process made, used, sold or otherwise disposed of
(except scrap as previously provided) by LICENSEE and its included AFFILIATES
and sublicensees in the Licensed Territory, the Net Sales thereof separated as
to Net Sales within the Licensed Territory and those of such Products made
within the Licensed Territory but sold elsewhere and the amount of royalty fee
due thereon, and with each such report LICENSEE agrees to pay the amount of
such fee due.  If no such fee is due to NTIS for any report period, the
written report shall so state.

3.6     All payments due NTIS under this Article III shall be payable in
United States dollars for the account of "NTIS/Patent Licensing."  All checks
and bank drafts shall be drawn on United States banks.  If payments are
overdue, late charges will be applied as required by the Department of
Treasury (Treasury Fiscal Requirements Manual, Section 8020.20).  Conversion
of foreign currency to United States dollars shall be made at the conversion
rate existing in the United States on the last business day of the applicable
reporting period for the purchase of United States dollar bank wire transfers
for settlement of such payment obligations.  Any and all loss of exchange,
value, taxes or other expenses incurred in the transfer or conversion of other
currency to United States dollars shall be paid entirely by LICENSEE.

3.7     LICENSEE and/or its included AFFILIATES and/or sublicensees shall
pay all necessary expenses for its commercialization of Products used in
practicing the Licensed Process and such expenses shall not be deducted from
any payments due NTIS as provided herein.

3.8     Except as provided in Paragraph 1.3(c), any tax on any payment due
NTIS under this ARTICLE III in any country in which such payment accrued shall
be paid by LICENSEE without deduction from the amount owned to NTIS.

                               ARTICLE IV
                                Markings

LICENSEE, its included AFFILIATES and sublicensees may, at their sole
option and in conformity with applicable statutes, identify Licensed Products
with the marking "Licensed Under U.S. Patent or "U.S. Patent Pending.""  The
name of the Government employee inventor(s), the name of any agency or
department of the United States Government, or any adaptation of the above
shall not be used in any promotional activity without prior written approval
from NTIS.

                                ARTICLE V
                           Reports and Records

5.1     LICENSEE shall provide written annual reports within sixty (60)
days of the end of each calendar year detailing progress being made to bring
the invention licensed hereunder to practical application.  No further annual
progress reports will be required after notification of the first commercial
sale of Licensed Products unless otherwise requested by NTIS.

5.2     LICENSEE and its included AFFILIATES shall keep and shall cause
their sublicensees to keep accurate and complete records of Products used in
practicing the Licensed Process made, used, sold or otherwise disposed of
(except scrap as previously provided), and such products used solely for
research under this Agreement in the Licensed Territory, appropriate to
determine the amount of the administration and royalty fee due hereunder. 
Such records shall be retained for at least two (2) years following a given
reporting period and, upon reasonable notice, shall be available during normal
business hours for inspection at the expense of NTIS by an accountant selected
by NTIS and approved by LICENSEE for the sole purpose of verifying reports and
payments hereunder.  Such accountant shall not disclose to NTIS any
information other than information relating to the accuracy of reports and
payments made under this Agreement.

                               ARTICLE VI
                           Patent Enforcement

6.1     LICENSEE shall notify NTIS promptly in writing of any infringement
of a Licensed Patent which becomes known to LICENSEE.  If NTIS determines that
a substantial infringement exists, NTIS shall communicate such determination
to LICENSEE in writing and take prompt action to attempt to eliminate that
substantial infringement.  LICENSEE shall cooperate with NTIS in determining
if substantial infringement exists and, if so, in attempting to eliminate that
substantial infringement.

6.2     If NTIS receives LICENSEE's infringement notice under the
provisions of paragraph 6.1 above and within a reasonable time following the
date of such notice, NTIS is unsuccessful in eliminating the infringement
which it has determined is substantial, NTIS agrees to recommend to the
appropriate United States Government authorities that an infringement action
based on such infringed Licensed Patent be initiated.  LICENSEE shall, at
NTIS' request, cooperate in every respect in the preparation and prosecuting
of such action including making available to NTIS records, information,
evidence, and testimony by employees of LICENSEE relevant to the substantial
infringement of the Licensed Patent.

6.3     If, after twelve (12) months from the date of LICENSEE's notice of
an infringement under the provisions of Paragraph 6.1 above, which
infringement NTIS has determined constitutes a substantial infringement of a
Licensed Patent and NTIS has not eliminated such substantial infringement and
the United States Government has not initiated an infringement suit, LICENSEE
shall be excused from payment of the royalty fee due hereunder resulting from
sales or other dispositions of Licensed Products.  When the substantial
infringement has been eliminated or an infringement suit has been initiated,
NTIS shall notify LICENSEE in writing of either of such event and LICENSEE's
obligation to pay the annual maintenance and royalty fee shall resume as of
the date that the infringement is eliminated or such infringement suit is
initiated.

                              ARTICLE VII
                         Licensee Performance

7.1     LICENSEE shall expend reasonable efforts and resources to carry
out the development and marketing plan submitted with LICENSEE's application
for a license and to bring Products used in practicing the Licensed Process to
the point of practical application (as defined at 37 C.F.R. 404.3(d)) within
four years of the effective date of this Agreement, unless this period is
extended by mutual agreement of the parties.  NTIS shall not unreasonably
withhold approval of any request of LICENSEE to extend this period, if such
request is supported by a reasonable showing by LICENSEE of due diligence
toward bringing such Products to the point of practical application.  "Due
diligence" shall include any reasonable and diligent application for approval
required by any Government agency within the United States.

7.2     After bringing Products used in practicing the Licensed Process to
the point of practical application in the Licensed Territory, LICENSEE agrees
to keep Licensed Products reasonably available to the public in the Licensed
Territory during the term of this Agreement.

7.3     LICENSEE agrees that Products used in practicing the Licensed
Process sold or otherwise disposed of in the United States by LICENSEE, its
included AFFILIATES and the sublicensees will be manufactured substantially in
the United States.

7.4     Failure to comply with the terms of this Article VII shall be
cause for modification or termination of this Agreement in accordance with the
provisions of Article VIII below.

                               ARTICLE VIII
                         Modification and Termination

8.1     This Agreement may be modified or terminated by NTIS subject to
the provisions of Paragraphs 8.2 and 10.4 below, if it is determined that:
(a)     LICENSEE, or any of its included AFFILIATES or any of its
sublicensees fail to meet the obligations set forth in Article VII
above;
(b)Such action is necessary to meet requirements for public use
specified by Federal regulations issued after the date of the
license and such requirements are not reasonably satisfied by the
LICENSEE, its included AFFILIATES or its sublicensees;
(c)     LICENSEE has willfully made a false statement of or
willfully omitted a material fact in the license application or in
any report required by this Agreement;
(d)     LICENSEE, or any of its included AFFIALIATES or any of its
sublicensees commit a substantial breach of a covenant or
agreement contained in this Agreement;
(e)     LICENSEE is adjudged a bankrupt or has its assets placed in
the hands of a receiver or makes any assignment or other
accommodation for the benefit of creditors; or
(f)     LICENSEE, or any of its included AFFILIATES or any of its
sublicensees misuse any Licensed Patent.

8.2     Prior to any modification or termination of this Agreement NTIS
shall furnish LICENSEE and any sublicensee of record a written notice of
intention to modify or terminate, and the LICENSEE and any notified
sublicensee shall be allowed thirty (30) days after the date on such notice to
remedy any breach or default of any covenant or agreement of this Agreement or
to show cause why this Agreement should not be modified or terminated.

8.3     LICENSEE may terminate this Agreement at any time as to any or all
Licensed Patents upon ninety (90) days written notice to NTIS.

8.4     Upon termination of this Agreement, sums due to NTIS from LICENSEE
in respect of the Licensed Patent(s) included in such termination shall become
immediately payable.  In all other respects, the rights and obligations of the
parties hereto concerning the Licensed Patent(s) included in such termination
shall cease as of the effective date of such termination.

8.5     In the event of termination of this Agreement, any sublicense of
record granted pursuant to Paragraph 2.2 may, at sublicensee's option, be
converted to a license directly between sublicensee and NTIS.

                               ARTICLE IX
                                Duration

This Agreement, unless sooner terminated as provided herein, shall
remain in effect until the expiration of the last-to-expire Licensed Patent.

                                 ARTICLE X
                                 General

10.1    NTIS represents and warrants that the entire right, title and
interest in the Licensed Patent(s) has been assigned to the United States of
America as represented by the Secretary of Commerce and that NTIS has the
authority to issue licenses under the Licensed Patent(s).  NTIS does not
warrant the patentability or validity of the Licensed Patent(s) and makes no
representations whatsoever with regard to the scope of the Licensed Patent(s)
or that such Licensed Patent(s) may be exploited without infringing other
patents.

10.2    This Agreement shall not be transferred or assigned by LICENSEE to
any party other than to a successor or assignee of the entire business
interest of LICENSEE relating to Licensed Products.

10.3    NTIS shall notify LICENSEE of any subsequent agreement containing
more favorable terms and conditions which may hereafter be granted by NTIS to
any other party under the Licensed Patents; and LICENSEE, if it is in a
position to do so, may substitute any or all the terms and conditions of such
other agreement for the terms and conditions of this Agreement.

10.4    The parties shall make every reasonable effort to resolve amicably
any dispute concerning a question of fact arising under this Agreement.  Any
disputes not settled amicably between the parties concerning a question of
fact arising under this Agreement shall be decided by the Director, NTIS, who
shall reduce his decision to writing and mail or otherwise furnish a copy
thereof to LICENSEE.  The decision of the Director, NTIS, to modify or
terminate this Agreement shall be final and conclusive unless LICENSEE mails
or otherwise furnishes to the Director, NTIS, a written appeal under the
Appeal Procedures of 15 C.F.R. Part 17, Subpart C.  Pending final decision of
a dispute hereunder, LICENSEE shall proceed diligently with the performance of
its obligations under this Agreement.

10.5    The interpretation and application of the provisions of this
Agreement shall be governed by the laws of the United States as interpreted
and applied by the Federal courts in the District of Columbia.

10.6    Written notices required to be given under this Agreement shall be
considered duly given if mailed by first class mail, postage prepaid and
addressed as follows:
If to NTIS:             Director, Office of Federal Patent Licensing
                        National Technical Information Service
                        United States Department of Commerce
                        5285 Port Royal Road
                        Springfield, VA 22161

If to LICENSEE:         Protein Design Labs, Inc.
                        3181 Porter Drive
                        Palo Alto, CA 94304

or such other address as either party may request in writing.

10.7    This Agreement constitutes the entire understanding and supersedes
all prior agreements and understandings between the parties with respect to
the subject matter hereof or information relating thereto except for any non-
disclosure agreement relating to the claims of the Licensed Patent(s) which
non-disclosure agreement, if any, is incorporated herein by reference, and
neither party shall be obligated by any condition, promise or representation
other than those expressly stated herein or as may be subsequently agreed to
by the parties hereto in writing.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives.
The Effective Date of this Agreement is October 31, 1988.

Witness:                               National Technical Information Service
/s/ P. Divanain                        /s/Joseph F. Caponio
-------------------                    --------------------
                                       JOSEPH F. CAPONIO
                                       Director

October 12, 1988                       October 12, 1988
-------------------                    --------------------
     Date                                   Date

Protein Design Labs, Inc.

Witness:
/s/ Cary Queen                         /s/Laurence Jay Korn
---------------------                  ---------------------
                                       (By)

                                       President
                                       ---------------------
                                       (Title)

    10/6/88                                6/10/88
---------------------                  ---------------------
     Date                                   Date


                     SCHEDULE OF LICENSED PATENTS

                                                          Patent
Country         Patent Application No.   Date Filed       Number    Grant Date

United States   7-085,707                8/17/88
Canada                                   8/17/88

PCT
Japan

EPO via PCT
Austria
Belgium
Switzerland
West Germany
France
United Kingdom
Italy
The Netherlands
Luxembourg
Sweden

Source: OneCLE Business Contracts.