<PAGE>
                                        *
                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    Form 10-Q

         (Mark One)
(X)      QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

         For the quarterly period ended June 30, 1997
                                        -------------   --------------

                                       OR

( )      TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES
         EXCHANGE ACT OF 1934

         For the transition period from               to
                                        -------------    -------------

         Commission File Number 0-19034
                                -------

                         REGENERON PHARMACEUTICALS, INC.
             ------------------------------------------------------
             (Exact name of registrant as specified in its charter)

             New York                                     13-3444607
- -------------------------------             ------------------------------------
(State or other jurisdiction of             (I.R.S. Employer Identification No.)
 incorporation or organization)

     777 Old Saw Mill River Road
           Tarrytown, New York                            10591-6707
- ----------------------------------------    ------------------------------------
(Address of principal executive offices)                  (Zip code)

                                 (914) 347-7000
              ----------------------------------------------------
              (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

                                        Yes X     No
                                           ---      ---


Indicate the number of shares outstanding of each of the issuer's classes of
common stock as of August 2, 1997:


        Class of Common Stock                          Number of Shares
        ---------------------                          ----------------

   Class A Stock, $0.001 par value                        4,279,814
   Common Stock, $0.001 par value                        26,604,819




<PAGE>

                         REGENERON PHARMACEUTICALS, INC.
                                Table of Contents
                                  June 30, 1997


<TABLE>
<CAPTION>
                                                                                           Page Numbers
                                                                                           ------------
<S>                                                                                        <C>


PART I  FINANCIAL INFORMATION


Item 1            Financial Statements
- ------            --------------------

                  Condensed balance sheets (unaudited) at June 30, 1997
                  and December 31, 1996                                                          3

                  Condensed statements of operations (unaudited) for the three
                  months and six months ended June 30, 1997 and 1996                             4

                  Condensed statements of cash flows (unaudited) for the
                  six months ended June 30, 1997 and 1996                                        5

                  Notes to condensed financial statements                                        6-7


Item 2            Management's Discussion and Analysis of  Financial Condition
- ------            ---------------------------------------  -------------------
                  and Results of Operations                                                      8-16
                  -------------------------


PART II  OTHER INFORMATION


Item 4            Submission of Matters to a Vote of Security Holders                            17
- ------            ---------------------------------------------------


Item 6            Exhibits and Reports on Form 8-K                                               18
- ------            --------------------------------



SIGNATURE PAGE                                                                                   19

Exhibit 10.1      Securities Purchase Agreement dated as of May 13, 1997
- ------------      between the Company and The Procter & Gamble Company

Exhibit 10.2      Warrant Agreement dated as of May 13, 1997 between the Company
- ------------      and The Procter & Gamble Company

Exhibit 10.3      Registration Rights Agreement dated as of May 13, 1997
- ------------      between the Company and The Procter & Gamble Company

Exhibit 10.4      Multi-Project Collaboration Agreement dated as of May 13,
- ------------      1997 between the Company and The Procter & Gamble Company

Exhibit 11        Statement of computation of net loss per share for the three
- ----------        months and six months ended June 30, 1997 and 1996

Exhibit 27        Financial data schedule
- ----------
                                        2
</TABLE>




<PAGE>

PART I  FINANCIAL INFORMATION

ITEM 1.  FINANCIAL STATEMENTS

REGENERON PHARMACEUTICALS, INC.
CONDENSED BALANCE SHEETS AT JUNE 30, 1997 AND DECEMBER 31, 1996 (Unaudited)


<TABLE>
<CAPTION>
                                                                                                      June 30,        December 31,
                                     ASSETS                                                             1997             1996
                                                                                                        ----             ----

<S>                                                                                                <C>              <C>          
Current assets
    Cash and cash equivalents                                                                      $  51,445,161    $  34,475,060
    Marketable securities                                                                             52,808,383       45,587,404
    Receivable due from Sumitomo Pharmaceuticals Company, Ltd.                                         2,327,400        2,072,455
    Receivable due from Merck & Co., Inc.                                                              1,914,117        1,816,056
    Receivable due from The Procter & Gamble Company                                                     937,500
    Receivable due from Amgen-Regeneron Partners                                                         805,621          446,269
    Prepaid expenses and other current assets                                                            394,763          611,435
                                                                                                   -------------    -------------
       Total current assets                                                                          110,632,945       85,008,679

Marketable securities                                                                                 25,246,355       16,965,302
Investment in Amgen-Regeneron Partners                                                                                  1,205,299
Property, plant and equipment, at cost, net of accumulated depreciation
    and amortization                                                                                  33,973,564       34,297,843
Other assets                                                                                             101,009          104,731
                                                                                                   -------------    -------------
       Total assets                                                                                $ 169,953,873    $ 137,581,854
                                                                                                   =============    =============

<CAPTION>
                      LIABILITIES and STOCKHOLDERS' EQUITY
<S>                                                                                                <C>              <C>
Current liabilities
    Accounts payable and accrued expenses                                                          $   5,076,750    $   4,357,145
    Capital lease obligations, current portion                                                         3,054,527        3,505,221
    Note payable, current portion                                                                         75,416           77,684
    Capital contribution due to Amgen-Regeneron Partners                                                 965,045                 
    Deferred revenue, current portion                                                                  1,676,326        4,108,412
                                                                                                   -------------    -------------
       Total current liabilities                                                                      10,848,064       12,048,462

Capital lease obligations                                                                              2,458,402        3,400,015
Note payable                                                                                           1,711,799        1,748,082
Other liabilities                                                                                        213,092          183,426

Deferred revenue                                                                                      14,778,415       13,270,870

Commitments and contingencies


Stockholders' equity
    Preferred stock, $.01 par value; 30,000,000 shares authorized; issued and outstanding - none
    Class A Stock, convertible, $.001 par value; 40,000,000 shares authorized;
         4,279,814 shares issued and outstanding in 1997
         4,355,994 shares issued and outstanding in 1996                                                   4,280            4,356
    Common Stock, $.001 par value; 60,000,000 shares authorized;
        26,604,819 shares issued and outstanding in 1997
        21,319,896 shares issued and outstanding in 1996                                                  26,605           21,320
    Additional paid-in capital                                                                       307,904,196      264,742,236
    Unearned compensation                                                                               (900,000)      (1,080,000)
    Accumulated deficit                                                                             (167,227,638)    (157,029,112)
    Net unrealized gain  on marketable securities                                                        136,658          272,199
                                                                                                   -------------    -------------
       Total stockholders' equity                                                                    139,944,101      106,930,999
                                                                                                   -------------    -------------
       Total liabilities and stockholders' equity                                                  $ 169,953,873    $ 137,581,854
                                                                                                   =============    =============
</TABLE>


    The accompanying notes are an integral part of the financial statements.

================================================================================

                                        3



<PAGE>

REGENERON PHARMACEUTICALS, INC.
CONDENSED STATEMENTS OF OPERATIONS (Unaudited)


<TABLE>
<CAPTION>
                                                  Three months                       Six months
                                                  ended June 30,                   ended June 30,
                                               1997            1996            1997            1996
                                           ----------------------------    ----------------------------

<S>                                        <C>             <C>             <C>             <C>

Revenues
       Contract research and development     $4,377,177      $4,596,390      $8,615,615      $8,779,286
       Investment income                      1,380,585       1,130,763       2,659,316       1,731,185
       Contract manufacturing                   858,510         431,009       1,554,966         836,360
                                           ------------    ------------    ------------    ------------
                                              6,616,272       6,158,162      12,829,897      11,346,831
                                           ------------    ------------    ------------    ------------


Expenses
       Research and development               6,880,316       6,802,561      13,956,787      13,728,964
       Loss in Amgen-Regeneron Partners         479,345       3,517,180       2,179,345       6,179,080
       General and administrative             1,688,276       1,586,554       3,152,203       3,097,499
       Depreciation and amortization          1,165,005       1,525,301       2,366,502       3,016,255
       Contract manufacturing                   475,673         123,770         968,535         239,106
       Interest                                 197,324         227,429         405,051         478,058
                                           ------------    ------------    ------------    ------------
                                             10,885,939      13,782,795      23,028,423      26,738,962
                                           ------------    ------------    ------------    ------------

Net loss                                    ($4,269,667)    ($7,624,633)   ($10,198,526)   ($15,392,131)
                                           ============    ============    ============    ============

Net loss per share                               ($0.16)         ($0.31)         ($0.38)         ($0.66)
                                           ============    ============    ============    ============


Weighted average number of Common
  and Class A shares outstanding             27,192,724      24,585,518      26,495,847      23,296,691
                                           ============    ============    ============    ============
</TABLE>


    The accompanying notes are an integral part of the financial statements.

================================================================================

                                        4



<PAGE>

REGENERON PHARMACEUTICALS, INC.
CONDENSED STATEMENTS OF CASH FLOWS (Unaudited)
Increase (Decrease) in Cash and Cash Equivalents


<TABLE>
<CAPTION>
                                                                                   Six months ended June 30,
                                                                                     1997            1996
                                                                                     ----            ----
<S>                                                                              <C>             <C>          

Cash flows from operating activities
      Net  loss                                                                  ($10,198,526)   ($15,392,131)
                                                                                 ------------    ------------
      Adjustments to reconcile net loss to net cash
        used in operating activities
          Loss in Amgen-Regeneron Partners                                          2,179,345       6,179,080
          Depreciation and  amortization                                            2,366,502       3,016,255
          Amortization of lease incentive
          Stock issued in consideration for services rendered                         180,000         180,000
          Changes in assets and liabilities
               Increase in amounts due from Amgen-Regeneron Partners                 (359,352)       (316,552)
               Increase in amounts due from Sumitomo Pharmaceuticals Co., Ltd.       (254,945)       (603,421)
               Increase in amounts due from Merck & Co., Inc.                         (98,061)     (2,794,534)
               Increase in amounts due from The Procter & Gamble Company             (937,500)        000,000
               Increase in investment in Amgen-Regeneron Partners                      (9,001)     (6,521,000)
               Decrease in prepaid expenses
                   and other assets                                                   220,394         130,675
               (Decrease) increase in deferred revenue                               (924,541)      3,445,172
               Increase (decrease) in accounts payable, accrued expenses,
                   and other liabilities                                              371,168        (533,047)
                                                                                 ------------    ------------
                           Total adjustments                                        2,734,009       2,182,628
                                                                                 ------------    ------------
                   Net cash used in operating activities                           (7,464,517)    (13,209,503)
                                                                                 ------------    ------------

Cash flows from investing activities
      Purchases of marketable securities                                          (46,077,877)    (41,117,516)
      Sales of marketable securities                                               30,440,304      20,209,644
      Capital expenditures                                                         (1,085,427)     (7,462,280)
                                                                                 ------------    ------------
                   Net cash used in investing activities                          (16,723,000)    (28,370,152)
                                                                                 ------------    ------------
Cash flows from financing activities
      Net proceeds from the issuance of stock                                      43,207,169      59,394,527
      Principal payments on note payable                                              (38,551)        (41,431)
      Capital lease payments                                                       (2,011,000)     (1,659,382)
                                                                                 ------------    ------------
                   Net cash provided by financing activities                       41,157,618      57,693,714
                                                                                 ------------    ------------


                   Net increase in cash and cash equivalents                       16,970,101      16,114,059
                                                                                 ------------    ------------

Cash and cash equivalents at beginning of period                                   34,475,060      32,736,026
                                                                                 ------------    ------------

                   Cash and cash equivalents at end of period                     $51,445,161     $48,850,085
                                                                                 ============    ============

Supplemental disclosure of cash flow information
      Cash paid for interest                                                         $375,385        $437,586
                                                                                 ============    ============
</TABLE>


    The accompanying notes are an integral part of the financial statements.

================================================================================

                                        5



<PAGE>

REGENERON PHARMACEUTICALS, INC.

Notes to Condensed Financial Statements

1.       Interim Financial Statements

         In the opinion of management of the Company, the accompanying unaudited
         interim financial statements reflect all adjustments, consisting only
         of normal recurring accruals, necessary to present fairly the Company's
         financial position as of June 30, 1997 and December 31, 1996 and the
         results of operations for the three months and six months ended June
         30, 1997 and 1996. The results of operations for such interim periods
         are not necessarily indicative of the results to be expected for the
         full year.

2.       Statement of Cash Flows

         Supplemental disclosure of noncash investing and financing activities:

         Capital lease obligations of approximately $619,000 and $775,000 were
         incurred during the first six months of 1997 and 1996, respectively,
         when the Company leased new equipment.

         Included in accounts payable and accrued expenses at June 30, 1997 were
         approximately $1,127,000 of capital expenditures and approximately
         $40,000 of costs incurred in connection with the Company's issuance of
         equity securities.

3.       Accounts Payable and Accrued Expenses

         Accounts payable and accrued expenses as of June 30, 1997 and 
         December 31, 1996 consist of the following:

                                                    June 30,    December 31,
                                                      1997         1996
                                                      ----         ----
                  Accounts payable                 $2,938,907   $2,178,308   
                  Accrued payroll and costs         1,006,600    1,047,812
                  Accrued clinical trial expense      319,500      319,500
                  Accrued expenses, other             410,280      389,062
                  Deferred compensation               401,463      422,463
                                                   ----------   ----------
                                                   $5,076,750   $4,357,145
                                                   ==========   ==========

4.       Collaboration Agreement

         In May 1997, the Company entered into a ten-year collaboration
agreement with The Procter & Gamble Company ("Procter & Gamble") to discover,
develop, and commercialize pharmaceutical products (the "P&G Agreement"), as
well as a securities purchase agreement and other related agreements. Procter &
Gamble agreed over the first five years of the various agreements to purchase up
to $60.0 million in Regeneron equity and provide up to $94.7 million in support

of Regeneron's research efforts related to the collaboration. In June 1997,
Procter & Gamble completed the purchase of 4.35 million shares of Regeneron
Common Stock at $9.87 per share for a total of $42.9 million and received five
year warrants to purchase an additional 1.45 million shares of Regeneron stock
at $9.87 per share. This purchase was in addition to a $10.0 

                                       6


<PAGE>

million purchase of Regeneron Common Stock at $12.50 per share that was
completed in March 1997 pursuant to a December 1996 stock purchase agreement.
The P&G Agreement expanded and superceded a collaboration agreement that the
companies entered into in December 1996 jointly to develop drugs for skeletal
muscle injury and atrophy.

         In the second five years of the P&G Agreement, the companies will share
all research costs equally. Clinical testing and commercialization expenses for
jointly developed products will be shared equally throughout the ten years of
the collaboration. Procter & Gamble will have rights to Regeneron's current
technology (other than its work in the area of neurotrophic factors and
cytokines), which is expected to have application in cardiovascular, bone,
muscle, arthritis, and other disease areas. Procter & Gamble will also have
rights to new technology developed as a result of the collaboration. The
companies expect jointly to develop and market worldwide any products resulting
from the collaboration and share equally in profits. Either company may
terminate the P&G Agreement at the end of five years with at least one year's
prior notice or earlier in the event of default.

         Contract research and development revenue related to the P&G Agreement
and the December 1996 collaboration agreement was $0.9 million in the second
quarter of 1997 and $1.9 million for the first half of 1997. At June 30, 1997,
the Procter & Gamble contract research revenue receivable was $0.9 million.

5.       Impact of the Future Adoptions of Recently Issued Accounting Standards

         In February 1997, the Financial Accounting Standards Board issued
Financial Accounting Standard No. 128, "Earnings Per Share" ("SFAS 128"). SFAS
128 will require the Company to replace the current presentation of "primary"
per share data with "basic" and "diluted" per share data. Currently, outstanding
common stock equivalents are antidilutive and therefore management estimates
that the future adoption of SFAS 128 currently will not have a material impact
on the Company's per share data. SFAS 128 will be adopted by the Company for
periods ending after December 15, 1997.

         The Financial Accounting Standards Board issued Financial Accounting
Standard No. 130, "Reporting Comprehensive Income" ("SFAS 130") in June 1997.
Comprehensive Income represents the change in net assets of a business
enterprise as a result of nonowner transactions. Management does not believe
that the future adoption of SFAS 130 will have a material effect on the
Company's financial position and results of operations. The Company will adopt
SFAS 130 for the year ending December 31, 1998.

         Also in June 1997, the Financial Accounting Standards Board issued

Financial Accounting Standard No. 131, "Disclosures about Segments of an
Enterprise and Related Information" ("SFAS 131"). SFAS 131 requires that a
business enterprise report certain information about operating segments,
products and services, geographic areas of operation, and major customers in
complete sets of financial statements and in condensed financial statements for
interim periods. The Company is required to adopt this standard in 1998 and is
currently evaluating the impact of the standard.

                                       7


<PAGE>


I
tem 2. Management's Discussion and Analysis of Financial Condition and Results
of Operations

General

         Overview. The discussion below contains forward-looking statements that
involve risks and uncertainties relating to the future financial performance of
Regeneron Pharmaceuticals, Inc. ("Regeneron" or the "Company") and actual events
or results may differ materially. These statements concern, among other things,
the possible therapeutic applications of the Company's product candidates and
research programs, the timing and nature of the Company's clinical and research
programs now underway or planned, a variety of items described in the footnotes
to the Company's financial statements (including the useful life of assets, the
anticipated length of agreements, and other matters), and the future uses of
capital and financial needs of the Company. These statements are made by the
Company based on management's current beliefs and judgment. In evaluating such
statements, stockholders and investors should specifically consider the various
factors identified under the caption "Factors That May Affect Future Operating
Results" which could cause actual results to differ materially from those
indicated by such forward-looking statements.

         In May 1997, the Company entered into a ten-year collaboration
agreement with The Procter & Gamble Company ("Procter & Gamble") to discover,
develop, and commercialize pharmaceutical products (the "P&G Agreement"), as
well as a securities purchase agreement and other related agreements. Procter &
Gamble agreed, over the first five years of the various agreements, to purchase
up to $60.0 million in Regeneron equity and provide up to $94.7 million in
support of Regeneron's research efforts related to the collaboration. In June
1997, Procter & Gamble completed the purchase of 4.35 million shares of
Regeneron Common Stock at $9.87 per share for a total of $42.9 million and
received five year warrants to purchase an additional 1.45 million shares of
Regeneron stock at $9.87 per share. This purchase was in addition to a $10.0
million purchase of Regeneron Common Stock at $12.50 per share that was
completed in March 1997 pursuant to a December 1996 stock purchase agreement.
The P&G Agreement expanded and superceded a collaboration agreement that the
companies entered into in December 1996 jointly to develop drugs for skeletal
muscle injury and atrophy.

         During the second quarter of 1997, Amgen Inc. ("Amgen"), on behalf of
Amgen-Regeneron Partners, continued to conduct clinical trials of brain-derived
neurotrophic factor ("BDNF") for the treatment of amyotrophic lateral sclerosis 
("ALS," commonly known as Lou Gehrig's disease) via intrathecal delivery 

and of neurotrophin-3 ("NT-3") for the treatment of peripheral neuropathies
caused by diabetes. Amgen also continued to conduct a trial of BDNF in Europe
for the treatment of neuropathies caused by diabetes. The Company continued to
develop and manufacture BDNF for use by Sumitomo Pharmaceuticals Co., Ltd.
("Sumitomo Pharmaceuticals") in Japan.

         In January 1997, Amgen and Regeneron announced that the Phase III
clinical trial of BDNF delivered subcutaneously did not demonstrate clinical
efficacy in patients with ALS and that the trial confirmed the safety and
tolerability of BDNF seen in earlier trials. The failure of the Phase III trial
to achieve its primary end points had a materially adverse effect on the price
of the Company's Common Stock (which declined more than 50% immediately after
the announcement of the results of the trial). After the Phase III clinical
trial results were announced, the Company retained independent experts in the
fields of neurology and gastroenterology, as well as independent statisticians,
to conduct further examination of the data. This review by the Company and the
outside panels

                                       8


<PAGE>

indicated 1) that a subset of ALS patients in the trial may have received a
benefit from BDNF treatment and 2) that BDNF appeared to have an effect on the
gastrointestinal system and might have a therapeutic role in treating
constipating conditions, among other disorders. The panels recommended, among
other things, that additional clinical and preclinical investigations of
subcutaneous BDNF for ALS and BDNF for gastrointestinal conditions should be
undertaken. The Company is reviewing these recommendations and the Phase III
data and is discussing with Amgen whether to undertake these or other
investigations of BDNF. Further development of BDNF in the United States must be
undertaken in accordance with the terms of the Company's collaboration agreement
with Amgen. Sumitomo Pharmaceuticals is currently planning to begin a Phase I
safety assessment of BDNF in 1997.

         The results of the Company's and its collaborators' past activities in
connection with the research and development of BDNF and NT-3 do not necessarily
predict the results or success of future activities including, but not limited
to, any additional preclinical or clinical studies of BDNF or NT-3. The Company
cannot predict whether, when, or under what conditions BDNF or NT-3 will be
shown to be safe or effective to treat any human condition or be approved for
marketing by any regulatory agency. The delay or failure of current or future
studies to demonstrate the safety or efficacy of BDNF or NT-3 to treat human
conditions or to be approved for marketing would have a material adverse impact
on the Company.

         Amgen continues to conduct a Phase I trial on behalf of Amgen-Regeneron
Partners of BDNF for ALS using intrathecal delivery. While intrathecal delivery
may be more successful in delivering BDNF to certain motor neurons (the nerve
cells that degenerate in ALS), it is not known whether intrathecal delivery will
prove any more successful in demonstrating safety and utility in patients with
ALS than the subcutaneous delivery used in the Phase III clinical trial that
failed to achieve its primary endpoints. If additional studies of BDNF for ALS
are undertaken, the time and expense required for such trials could be material

to the Company and the outcome will be uncertain. If subsequent trials are
conducted and such trials fail to demonstrate that BDNF is safe and effective in
the treatment of ALS, that failure could have a materially adverse effect on the
Company, the price of the Company's Common Stock, and the Company's ability to
raise additional capital.

         No assurance can be given that extended administration of NT-3 will be
safe or effective. The Phase I study of NT-3 in normal human volunteers that
concluded in 1995 was a short term (seven day) treatment study. The current NT-3
clinical study involves substantially longer treatment (six months or longer).
The treatment of peripheral neuropathy may present additional clinical trial
risks in light of the complex and not wholly understood mechanisms of action
that lead to the neuropathies, the presence of many other drugs to treat the
underlying conditions, the potential difficulty of achieving significant
clinical endpoints, and other factors. No assurance can be given that these or
any other studies of NT-3 will be successful or that NT-3 will be
commercialized.

         To date, Regeneron has not received any revenues from the commercial
sale of products and may never receive such revenues. Before such revenues can
be realized, the Company (or its collaborators) must overcome a number of
hurdles which include successfully completing its research and development
efforts and obtaining regulatory approval from the United States Food and Drug
Administration ("FDA") or regulatory authorities in other countries. In
addition, the biotechnology and pharmaceutical industries are rapidly evolving
and highly competitive, and new developments may render the Company's products
and technologies noncompetitive and obsolete.

                                       9


<PAGE>

         In the absence of revenues from commercial product sales or other
sources (the amount, timing, nature, or source of which can not be predicted),
the Company's losses will continue as the Company conducts its research and
development activities. The Company's activities may expand over time and may
require additional resources, and the Company's operating losses may be
substantial over at least the next several years. The Company's losses may
fluctuate from quarter to quarter and will depend, among other factors, on the
timing of certain expenses and on the progress of the Company's research and
development efforts.

Results of Operations

         Three months ended June 30, 1997 and 1996. The Company's total revenue
increased to $6.6 million for the second quarter of 1997 from $6.2 million for
the same period in 1996. Contract research and development revenue decreased to
$4.4 million for the second quarter of 1997 from $4.6 million for the same
period in 1996. Contract research and development revenue earned from Sumitomo
Pharmaceuticals was $3.1 million for the second quarters of both 1997 and 1996,
representing $0.8 million for contract research and $2.3 million of
reimbursement for developing manufacturing processes for BDNF and supplying
BDNF. Contract research and development revenue earned from Amgen-Regeneron
Partners ("the Partnership") decreased to $0.4 million for the second quarter of

1997 from $1.5 million for the same period in 1996, as the Partnership conducted
less basic research on BDNF and NT-3. The Company entered into a research
collaboration agreement with Procter & Gamble in December 1996, which was
superceded by the P&G Agreement in May 1997. Contract research revenue related
to these agreements totaled $0.9 million for the second quarter 1997. Contract
manufacturing revenue related to the long-term manufacturing agreement (the
"Merck Agreement") with Merck & Co., Inc. ("Merck") for the second quarters of
1997 and 1996 totaled $0.9 million and $0.4 million, respectively. Investment
income in the second quarter of 1997 increased to $1.4 million from $1.1 million
for the same period in 1996, due primarily to higher levels of interest-bearing
investments resulting from the private placements of equity securities in 1996
and 1997 with Amgen, Medtronic, Inc. ("Medtronic"), and Procter & Gamble.

         The Company's total operating expenses decreased to $10.9 million in
the second quarter of 1997 from $13.8 million for the same period in 1996.
Research and development expenses were $6.9 million in the second quarter of
1997 and $6.8 million for the same period in 1996. Loss in Amgen-Regeneron
Partners decreased to $0.5 million in the second quarter of 1997 from $3.5
million for the same period in 1996 as the Partnership completed the Phase III
clinical trial of BDNF in 1996. Research and development expenses (including
Loss in Amgen-Regeneron Partners) were approximately 68% of total operating
expenses in the second quarter of 1997 compared to 75% for the same period in
1996.

         General and administrative expenses were $1.7 million in the second
quarter of 1997 and $1.6 million for the same period in 1996. Depreciation and
amortization expense decreased to $1.2 million in the second quarter of 1997
from $1.5 million in the second quarter of 1996 as certain laboratory equipment
became fully depreciated and capitalized patent costs were fully amortized in
1996. Interest expense was $0.2 million for the second quarters of both 1997 and
1996. Contract manufacturing expenses are direct expenses related to the
long-term manufacturing agreement with Merck. Such expenses, which are
reimbursed by Merck, increased to $0.5 million in the second quarter of 1997
from $0.1 million in the same period of 1996, primarily from increased equipment
validation costs.

                                       10


<PAGE>

         The Company's net loss for the second quarter of 1997 was $4.3 million,
or $0.16 per share, compared to a net loss of $7.6 million, or $0.31 per share,
for the same period in 1996.

         Six months ended June 30, 1997 and 1996. The Company's total revenue
increased to $12.8 million for the six months ended June 30, 1997 from $11.3
million for the same period in 1996. Contract research and development revenue
for the six months ended June 30 decreased to $8.6 million in 1997 from $8.8
million in 1996. Contract research and development revenue for six months earned
from Sumitomo Pharmaceuticals was $5.9 million in 1997 and $5.8 million in 1996,
consisting of contract research revenue of $1.5 million in both periods and
reimbursement for developing manufacturing processes for BDNF and supplying BDNF
of $4.4 million in 1997 and $4.3 million in 1996. Contract research and
development revenue earned from Amgen-Regeneron Partners decreased to $0.8

million for the six months ended June 30, 1997 from $3.0 million for the same
period in 1996, as the Partnership conducted less basic research on BDNF and
NT-3. The Company entered into a research collaboration agreement with Procter &
Gamble in December 1996, superceded by the P&G Agreement in May 1997. Contract
research revenue related to these agreements totaled $1.9 million for the first
half of 1997. Contract manufacturing revenue related to the Merck Agreement for
the six months ended June 30, 1997 and 1996 totaled $1.6 million and $0.8
million, respectively. The increase represents reimbursement of increased costs
of equipment validation and personnel. Investment income in the first half of
1997 increased to $2.7 million from $1.7 million in the same period of 1996, due
primarily to higher levels of interest-bearing investments resulting from the
private placements of equity securities in 1996 and 1997 with Amgen, Medtronic,
and Procter & Gamble.

         The Company's total operating expenses decreased to $23.0 million in
the six months ended June 30, 1997 from $26.7 million for the same period in
1996. Research and development expenses increased to $14.0 million in the first
half of 1997 from $13.7 million for the same period in 1996. Loss in
Amgen-Regeneron Partners for the first six months of 1997 decreased to $2.2
million from $6.2 million for the same period in 1996, as the Partnership
completed the Phase III clinical trial of BDNF in 1996. Research and development
expenses for the six months ended June 30, 1997 and 1996 (including Loss in
Amgen-Regeneron Partners) represented approximately 70% and 74% of total
operating expenses, respectively.

         General and administrative expenses were $3.2 million and $3.1 million
in the first half of 1997 and 1996, respectively. Depreciation and amortization
expense decreased to $2.4 million in the first half of 1997 from $3.0 million in
the first half of 1996, as certain laboratory equipment became fully depreciated
and capitalized patent costs were fully amortized in 1996. Interest expense
decreased to $0.4 million for the six month period ended June 30, 1997 from $0.5
million in the comparable period in 1996, resulting from the expiration of
equipment leases during 1996. Contract manufacturing expenses are direct
expenses related to the long-term manufacturing agreement with Merck. Such
expenses, which are reimbursed by Merck, increased to $0.9 million in the first
half of 1997 from $0.2 million in the same period of 1996, primarily from
increased equipment validation costs.

         The Company's net loss for the six months ended June 30, 1997 was $10.2
million, or $0.38 per share, compared to a net loss of $15.4 million, or $0.66
per share, for the same period in 1996.

                                       11


<PAGE>

Liquidity and Capital Resources

         Since its inception in 1988, the Company has financed its operations
primarily through private placements and public offerings of its equity
securities, revenue earned under the several agreements between the Company and
each of Amgen, Sumitomo Chemical Company, Ltd., Sumitomo Pharmaceuticals, Merck,
and Procter & Gamble and investment income. Procter & Gamble agreed over the
first five years of the P&G Agreement to purchase up to $60.0 million in

Regeneron equity and provide up to $94.7 million in support of Regeneron's
research efforts related to the collaboration. In June 1997, Procter & Gamble
completed the purchase of 4.35 million shares of Regeneron Common Stock at $9.87
per share for a total of $42.9 million and received five year warrants to
purchase an additional 1.45 million shares of Regeneron stock at $9.87 per
share. This purchase was in addition to a $10.0 million purchase of Regeneron
Common Stock at $12.50 per share that was completed in March 1997 pursuant to a
December 1996 stock purchase agreement. The P&G Agreement expanded and
superceded a collaboration agreement that the companies entered into in December
1996 jointly to develop drugs for skeletal muscle injury and atrophy. In
connection with the Company's agreement to collaborate with Sumitomo
Pharmaceuticals in the research and development of BDNF in Japan, Sumitomo
Pharmaceuticals paid the Company $22.0 million through December 1996 (which
includes a payment of $3.0 million for 1997) and agreed to pay the Company an
additional $3.0 million in 1998. Sumitomo Pharmaceuticals has the option to
cancel the 1998 payment; however, if such a cancellation were to occur, Sumitomo
Pharmaceutical's rights to develop and commercialize BDNF in Japan would revert
to the Company. In addition, the Company is being reimbursed in connection with
supplying Sumitomo Pharmaceuticals with BDNF for preclinical use.

         The Company's activities relating to BDNF and NT-3, as agreed upon by
Amgen and Regeneron, are being reimbursed by Amgen-Regeneron Partners, and the
Company recognizes such reimbursement as revenue. The funding of Amgen-Regeneron
Partners is through capital contributions from Amgen and Regeneron, who must
make equal payments in order to maintain equal ownership and equal sharing of
any profits or losses from the Partnership. The Company has made capital
contributions totaling approximately $42.6 million to Amgen-Regeneron Partners
from the Partnership's inception in June 1993 through June 30, 1997. The Company
expects that its capital contributions in 1997 will total approximately $3.0
million. These contributions could increase or decrease, depending upon the cost
of Amgen-Regeneron Partners' conducting additional BDNF and NT-3 preclinical and
clinical studies and the outcomes of those and other ongoing studies. Capital
contributions in future years are anticipated to be greater than in 1997.

         From its inception in January 1988 through June 30, 1997, the Company
invested approximately $55.5 million in property, plant, and equipment. This
includes $16.8 million to acquire and renovate the Rensselaer facility, $6.3
million of newly completed construction at the facility, and $7.6 million of
construction in progress related to the modification of the facility in
connection with the Merck Agreement. In connection with the purchase and
renovation of the Rensselaer facility, the Company obtained financing of $2.0
million from the New York State Urban Development Corporation, of which $1.8
million is outstanding. Under the terms of such financing, the Company is not
permitted to declare or pay dividends to its stockholders.

                                       12


<PAGE>

         During 1996, the Company entered into a series of new leasing
agreements (the "New Lease Line") which provide up to $4.0 million to finance
equipment acquisitions and certain building improvements, as defined
(collectively, the "Equipment"). The Company may utilize the New Lease Line in
increments ("leases"). Lease terms are for four years after which the Company is

required to purchase the Equipment at defined amounts. Certain of the leases may
be renewed for eight months at defined monthly payments after which the Company
will own the Equipment. At June 30, 1997, the Company had available
approximately $0.5 million of the New Lease Line.

         The Company expects that expenses related to the filing, prosecution,
defense and enforcement of patent and other intellectual property claims will
continue to be substantial as a result of patent filings and prosecutions in the
United States and foreign countries. The Company is currently involved in two
interference proceedings in the Patent and Trademark Office between Regeneron's
patent applications and patents relating to CNTF issued to Synergen, Inc. Amgen
acquired all outstanding shares of Synergen in 1994.

         As of June 30, 1997, the Company had no established banking
arrangements through which it could obtain short-term financing or a line of
credit. Additional funds may be raised through, among other things, the issuance
of additional securities, other financing arrangements, and future collaboration
agreements. No assurance can be given that additional financing will be
available or, if available, that it will be available on acceptable terms.

         At June 30, 1997, the Company had $129.5 million in cash, cash
equivalents, and marketable securities. The Company expects to incur ongoing
funding requirements for capital contributions to Amgen-Regeneron Partners to
support the continued development and clinical trials of BDNF and NT-3. The
Company also expects to incur substantial funding requirements for, among other
things, its research and development activities (including preclinical and
clinical testing), validation of its manufacturing facilities, and the
acquisition of equipment, and may incur substantial funding requirements for
expenses related to the patent interference proceedings and other patent
matters. The amount needed to fund operations will also depend on other factors,
including the status of competitive products, the success of the Company's
research and development programs, the status of patents and other intellectual
property rights developments, and the continuation, extent, and success of any
collaborative research programs (including those with Amgen and Procter &
Gamble). The Company expects to incur additional capital expenditures in
connection with the renovation and validation of its Rensselaer facility
pursuant to its manufacturing agreement with Merck. However, the Company also
expects that such expenditures will be substantially reimbursed by Merck,
subject to certain conditions. The Company believes that its existing capital
resources will enable it to meet operating needs for at least the next several
years. No assurance can be given that there will be no change in projected
revenues or expenses that would lead to the Company's capital being consumed at
a faster rate than currently expected. In order to continue to attempt to assure
Regeneron's financial condition and maximize its technological developments for
the long-term benefit of shareholders, the Company from time to time seeks
additional corporate partners and explores other opportunities to obtain
research and development funding. No assurance can be given that such partners
or funding will be available or, if available, will be on terms favorable or
acceptable to the Company.

                                       13


<PAGE>


Factors That May Affect Future Operating Results

         Regeneron cautions stockholders and investors that the following
important factors, among others, in some cases have affected, and in the future
could affect, Regeneron's actual results and could cause Regeneron's actual
results to differ materially from those expressed in any forward-looking
statements made by, or on behalf of, Regeneron. The statements under this
caption are intended to serve as cautionary statements within the meaning of the
Private Securities Litigation Reform Act of 1995. The following information is
not intended to limit in any way the characterization of other statements or
information under other captions as cautionary statements for such purpose:

o        Delay, difficulty, or failure of the Company's preclinical drug
         research and development programs to produce product candidates that
         are scientifically or commercially appropriate for further development
         by the Company or others.

o        Delay, difficulty, or failure in obtaining regulatory approval
         (including approval of its facilities for production) for the Company's
         products (including vaccine intermediate for Merck), including delays
         or difficulties in development because of insufficient proof of safety
         or efficacy.

o        Increased and irregular costs of development, regulatory approval,
         manufacture, sales, and marketing associated with the introduction of
         products in the late stage of development.

o        Cancellation or termination of material collaborative or licensing
         agreements (including in particular, but not limited to, those with
         Procter & Gamble and Amgen) and the resulting loss of research or other
         funding, could have a material adverse effect on the Company and its
         operations. A change of control of one or more of the Company's
         material collaborators or licensees could also have a material adverse
         effect on the Company.

o        Competitive or market factors may cause use of the Company's products
         to be limited or otherwise fail to achieve broad acceptance.

o        The ability to obtain, maintain, and prosecute intellectual property
         rights, and the cost of acquiring in-process technology and other
         intellectual property rights, either by license, collaboration, or
         purchase of another entity.

o        Difficulties or high costs of obtaining adequate financing to meet the
         Company's obligations under its collaboration and licensing agreements
         or to fund 50 percent of the cost of developing product candidates in
         order to retain 50 percent of the commercialization rights.

o        Amount and rate of growth in Regeneron's selling, general, and
         administrative expenses, and the impact of unusual or infrequent
         charges resulting from Regeneron's ongoing evaluation of its business
         strategies and organizational structure.

                                       14



<PAGE>

o        Failure of corporate partners to commercialize successfully the
         Company's products or to retain and expand the markets served by the
         commercial collaborations; conflicts of interest, priorities, and
         commercial strategies which may arise between the Company and such
         corporate partners.

o        Difficulties in launching or marketing the Company's products by the
         Company or its licensees, especially when such products are novel
         products based on biotechnology, and unpredictability of customer
         acceptance of such products.

o        Inability to maintain or initiate third party arrangements which
         generate revenues, in the form of license fees, research and
         development support, royalties, and other payments, in return for
         rights to technology or products under development by the Company.

o        Delays or difficulties in developing and acquiring production
         technology and technical and managerial personnel to manufacture novel
         biotechnology products in commercial quantities at reasonable costs and
         in compliance with applicable quality assurance and environmental
         regulations and governmental permitting requirements.

o        Difficulties in obtaining key raw materials and supplies for the
         manufacture of the Company's product candidates.

o        The costs and other effects of legal and administrative cases and
         proceedings (whether civil, such as product-related or environmental,
         or criminal); settlements and investigations; developments or
         assertions by or against Regeneron relating to intellectual property
         rights and licenses; the issuance and use of patents and proprietary
         technology by Regeneron and its competitors, including the possible
         negative effect on the Company's ability to develop, manufacture, and
         sell its products in circumstances where it is unable to obtain
         licenses to patents which may be required for such products.

o        Underutilization of the Company's existing or new manufacturing
         facilities or of any facility expansions, resulting in inefficiencies
         and higher costs; start-up costs, inefficiencies, delays, and increased
         depreciation costs in connection with the start of production in new
         plants and expansions.

o        Health care reform, including reductions or changes in reimbursement
         available for prescription medications or other reforms.

o        The ability to attract and retain key personnel. As Regeneron's
         scientific efforts lead to potentially promising new directions, both
         outside of recombinant protein therapies (into orally active, small
         molecule pharmaceuticals) and outside of treatments for neurological
         and neurodegenerative conditions (into, for example, potential programs
         in cancer, inflammation, muscle disease, bone growth disorders,
         angiogenesis, and hemopoiesis), the Company will require additional

         internal expertise or external collaborations in areas in which it
         currently does not have substantial resources and personnel.

                                       15


<PAGE>

Impact of the Adoption of Recently Issued Accounting Standards

         In February 1997, the Financial Accounting Standards Board issued
Financial Accounting Standard No. 128, "Earnings Per Share" ("SFAS 128"). SFAS
128 will require the Company to replace the current presentation of "primary"
per share data with "basic" and "diluted" per share data. Currently, outstanding
common stock equivalents are antidilutive and therefore management estimates
that the future adoption of SFAS 128 currently will not have a material impact
on the Company's per share data. SFAS 128 will be adopted by the Company for
periods ending after December 15, 1997.

         The Financial Accounting Standards Board issued Financial Accounting
Standard No. 130, "Reporting Comprehensive Income" ("SFAS 130") in June 1997.
Comprehensive Income represents the change in net assets of a business
enterprise as a result of nonowner transactions. Management does not believe
that the future adoption of SFAS 130 will have a material effect on the
Company's financial position and results of operations. The Company will adopt
SFAS 130 for the year ending December 31, 1998.

         Also in June 1997, the Financial Accounting Standards Board issued
Financial Accounting Standard No. 131, "Disclosures about Segments of an
Enterprise and Related Information" ("SFAS 131"). SFAS 131 requires that a
business enterprise report certain information about operating segments,
products and services, geographic areas of operation, and major customers in
complete sets of financial statements and in condensed financial statements for
interim periods. The Company is required to adopt this standard in 1998 and is
currently evaluating the impact of the standard.

                                       16



<PAGE>


P
ART II. OTHER INFORMATION
         -----------------


ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
- ------- ---------------------------------------------------

                  On June 27, 1997, the Company conducted its Annual Meeting of
         Shareholders pursuant to due notice. A quorum being present either in
         person or by proxy, the shareholders voted on the following matters:

         1. To elect three Directors to hold office for a three-year term as
         Class III directors, and until their successors are duly elected and
         qualified.

         2. To amend the Company's Amended and Restated 1990 Long-Term Incentive
         Plan ("the Long-Term Incentive Plan") to increase by 1,500,000 the
         number of shares of Regeneron Common Stock available for the grant of
         options and rights and the award of restricted stock and to clarify and
         update the Long-Term Incentive Plan.

         3. To approve the selection of Coopers & Lybrand L.L.P. as independent
         accountants for the Company's fiscal year ending December 31, 1997.

         No other matters were voted on. The number of votes cast was:

                                                   For      Withhold Authority
                                               ----------   ------------------
         1.  Election of Class III Directors
                  Charles A. Baker             56,961,600      2,496,950
                  George L. Sing               56,965,340      2,493,210
                  Michael S. Brown, M.D.       56,962,400      2,496,150

                  The terms of office of P. Roy Vagelos, M.D., Leonard S.
         Schleifer, M.D., Ph.D., Eric M. Shooter, Ph.D., Alfred G. Gilman, M.D.,
         Ph.D., Joseph L. Goldstein, M.D., and Michael S. Brown, M.D. continued
         after the meeting.

                                             For          Against      Abstain
                                             ---          -------      -------
         2.  Amendment of Long-Term      
               Incentive Plan             47,622,010     6,091,980     59,290
         3.  Selection of accountants     59,211,089       222,836     24,625

                                       17


<PAGE>


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
- -------  --------------------------------

(a)      Exhibits


                  10.1     Securities Purchase Agreement dated as of May 13,
                           1997 between the Company and The Procter & Gamble
                           Company

                  10.2     Warrant Agreement dated as of May 13, 1997 between
                           the Company and The Procter & Gamble Company.

                  10.3     Registration Rights Agreement dated as of May 13,
                           1997 between the Company and The Procter & Gamble
                           Company.

                 *10.4     Multi-Project Collaboration Agreement dated as of May
                           13, 1997 between the Company and The Procter & Gamble
                           Company.

                  11       Statement of computation of loss per share for the
                           three months and six months ended June 30, 1997 and
                           1996.

                  27       Financial Data Schedule

         (b)      Reports

                  On May 13, 1997 the Company filed a report on Form 8-K
                  regarding the fact that the Company issued a press release
                  entitled "Procter & Gamble and Regeneron Form 10-Year Research
                  Collaboration to Discover, Develop Pharmaceutical Products", a
                  copy of which was included as an exhibit to that filing. See
                  footnote 4 in Notes to Condensed Financial Statements, page 7
                  of this Form 10-Q.

         *        Portions of this document have been omitted and filed
                  separately with the Commission pursuant to requests for
                  confidential treatment pursuant to Rule 24b-2.

                                       18



<PAGE>


                                    SIGNATURE
                                    ---------

Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.

                                   Regeneron Pharmaceuticals, Inc.

Date: August 12, 1997              By:         /s/ Murray A. Goldberg
     -------------------               -----------------------------------------
                                       Murray A. Goldberg
                                       Vice President, Finance & Administration,
                                       Chief Financial Officer, and Treasurer

                                      19






<PAGE>

                                 EXHIBIT 10.1
                                 ------------

                         SECURITIES PURCHASE AGREEMENT

                                BY AND BETWEEN

                        REGENERON PHARMACEUTICALS, INC.

                                      and

                         THE PROCTER & GAMBLE COMPANY

                           Dated as of May 13, 1997

<PAGE>

                               TABLE OF CONTENTS

ARTICLE I   DEFINITIONS                                             1
  1.1. CERTAIN DEFINITIONS                                          1
ARTICLE II   ISSUANCE AND SALE OF SECURITIES                        3
  2.1  ISSUANCE AND SALE OF SECURITIES                              3
ARTICLE III  CLOSINGS                                               3
  3.1  CLOSING                                                      3
  3.2  PURCHASE OF SECURITIES                                       4
  3.3. DOCUMENTS TO BE DELIVERED                                    4
  3.4  MINIMUM PURCHASE REQUIRED FOR FUTURE AND OPTIONAL
       CLOSINGS; LIMITATION                                         4
  3.5  PURCHASE OF OPTIONAL SECURITIES                              5
  3.6  LOCK UP                                                      5
  3.7  FURTHER AGREEMENTS REGARDING BUYER'S EQUITY LIMITATIONS      5
ARTICLE IV  REPRESENTATIONS AND WARRANTIES OF THE COMPANY           6
  4.1  ORGANIZATION AND STANDING                                    6
  4.2  CAPITALIZATION                                               6
  4.3  ISSUANCE OF SECURITIES                                       7
  4.4  AUTHORITY FOR AGREEMENT                                      7
  4.5  GOVERNMENTAL CONSENTS                                        7
  4.6  LITIGATION                                                   7
  4.7  SEC FILINGS; FINANCIAL STATEMENTS                            8
  4.8  BROKERS                                                      8 
  4.9  NO UNDISCLOSED LIABILITIES                                   8
  4.10  ABSENCE OF CHANGES                                          8
  4.11  NO DEFAULTS                                                 8
  4.12  OFFERINGS                                                   8

                                      -2-


<PAGE>

ARTICLE V  REPRESENTATIONS AND WARRANTIES OF THE BUYER              9
  5.1  LEGAL POWER                                                  9
  5.2  DUE EXECUTION                                                9

  5.3  INVESTMENT REPRESENTATIONS                                   9
  5.4  BROKERAGE                                                    9
ARTICLE VI  CONDITIONS TO CLOSING OF BUYER                         10
  6.1  REPRESENTATIONS AND WARRANTIES TRUE; PERFORMANCE OF
       OBLIGATIONS                                                 10
  6.2  COLLATERAL
 AGREEMENTS                                       10
  6.3  OPINION OF THE COMPANY'S COUNSEL                            10
  6.4  PROCEEDINGS AND DOCUMENTS                                   10
ARTICLE VII  CONDITIONS TO CLOSING OF THE COMPANY                  10
  7.1  REPRESENTATIONS AND WARRANTIES TRUE                         10
  7.2  PERFORMANCE OF OBLIGATIONS                                  10
  7.3  QUALIFICATIONS, LEGAL INVESTMENT                            11
  7.4  COLLATERAL AGREEMENTS                                       11
ARTICLE VIII  MISCELLANEOUS                                        11
  8.1  GOVERNING LAW                                               11
  8.2  SURVIVAL                                                    11
  8.3  SUCCESSORS AND ASSIGNS                                      11
  8.4  ENTIRE AGREEMENT                                            11
  8.5  SEPARABILITY                                                11
  8.6  AMENDMENT AND WAIVER                                        11
  8.7  DELAYS OR OMISSIONS                                         11
  8.8  NOTICES, ETC.                                               12
  8.9  TITLES AND SUBTITLES                                        12
  8.10  COUNTERPARTS                                               13

                                      -3-


<PAGE>

SIGNATURE PAGE                                                     14
APPENDIX A                                                        A-1

                                      -4-



<PAGE>

                        REGENERON PHARMACEUTICALS, INC.
                         SECURITIES PURCHASE AGREEMENT

     This Agreement is made as of May 13, 1997, by and between Regeneron
Pharmaceuticals, Inc., a corporation organized under the laws of New York (the
"Company"), with its principal office at 777 Old Saw Mill River Road, Tarrytown,
New York 10591, and The Procter & Gamble Company, a corporation organized under
the laws of Ohio (the "Buyer"), with its principal office at One Procter &
Gamble Plaza, Cincinnati, Ohio 45202.

                                   ARTICLE 1

                                  DEFINITIONS

          1.1  Certain Definitions.  As used in this Agreement, the following
terms shall have the following respective meanings:

          "Additional Securities" means equity securities that the Company sells
to Buyer pursuant to Section 3.2(iii).

          "Affiliate" means any corporation, company, partnership, joint
venture, or other entity which controls, is controlled by, or is under common
control with Buyer. For purposes of this definition control shall mean the
direct or indirect ownership of at least fifty (50%) percent or, if less than
fifty (50%) percent, the maximum percentage as allowed by applicable law of (a)
the shares of capital stock entitled to vote for the election of directors, or
(b) ownership interest.

          "Buyer's Equity Limitations" means the limitations that in no event
(a) may Buyer purchase or own more than 20% of the Outstanding Securities or
possess more than 20% of the voting rights of the shares of the Company and, in
addition, (b) during the Optional Period may the Buyer be required to purchase
Securities or Additional Securities under this Agreement having a Value in the
aggregate that exceeds 20% of the Company's cumulative research funding
obligations during Fiscal Years 6 through 10 pursuant to the Collaboration
Agreement.

          "Closing" means the closings of the sale and purchase of Securities
and Additional Securities issued and sold to Buyer in accordance with the terms
of this Agreement. The first such Closing to be held on the Effective Date shall
be called "Closing I." Closings other than Closing I conducted during the
Initial Period shall be called "Future Closings." Closings conducted during the
Optional Period shall be called "Optional Closings." All Closings, including
Closing I, Future Closings, and any Optional Closings, may be generally referred
to herein as Closings.

          "Collaboration Agreement" means that certain Collaboration Agreement,
dated May 13, 1997 between Regeneron Pharmaceuticals, Inc. and The Procter &
Gamble Company. The Effective Date of the Collaboration Agreement will be
referred to herein as the "Effective Date" and references to "Fiscal Year" shall
have the same meaning herein as in the Collaboration Agreement.


          "Collateral Agreements" means the Collaboration Agreement, together
with the Warrant Agreement between the parties dated as of May 13, 1997 (the
"Warrant

                                      -5-

<PAGE>

Agreement") and the Registration Rights Agreement between the parties dated as 
of May 13, 1997 (the "Registration Rights Agreement").

          "Commission" means the Securities and Exchange Commission, or any
other Federal agency at the time administering the Securities Act.

          "Common Stock" means the Common Stock, par value $.001 per share, of
the Company.

          "Current Market Price" means the average (rounded to the nearest cent)
of the Quoted Price of the Common Stock for the 30 consecutive trading days
commencing 45 trading days before (and not including) the date in question.

          "Exchange Act" means the Securities Exchange Act of 1934, as amended,
and any successor Federal statute, and the rules and regulations of the
Commission issued under such Act, as they each may, from time to time, be in
effect.

          "Exercise Price" means the price for which one share of Common Stock
may be purchased by the exercise of one Warrant. The Exercise Price in respect
of Warrants issued as part of a sale of Securities sold in Future Closings shall
equal the Purchase Price of the Common Stock sold to the Buyer together with the
Warrants in such sale of Securities in accordance with Section 3.2(ii). The
Exercise Price in respect of Securities sold in Optional Closings shall be
determined in accordance with Appendix A.

          "Initial Period" means the period beginning on the Effective Date and
ending on the fifth anniversary of the Effective Date.

          "Initial Securities" means Securities and Additional Securities
purchased by Buyer pursuant to this Agreement at Closing I or any Future Closing
during the Initial Period having a Value in the aggregate of $60 million.

          "Optional Period" means the period beginning on the fifth anniversary
of the Effective Date and ending on the tenth anniversary of the Effective Date.

          "Optional Securities" means Securities or Additional Securities
purchased by Buyer pursuant to this Agreement at an Optional Closing during the
Optional Period.

          "Outstanding Securities" means the total number of shares of the
Company's issued and outstanding Common Stock and all shares of Common Stock (a)
into which any issued and outstanding shares of preferred stock and any other
securities exchangeable or convertible into Common Stock are exchangeable or
convertible and (b) for which any issued, outstanding, and exercisable options
or warrants to acquire Common Stock are then exercisable (all such calculations
to include such Securities or Additional Securities to be issued at any Closing

with respect to which Outstanding Securities is being calculated).

          "Purchase Price" means the price per share of Common Stock sold to
Buyer as part of a sale of Securities under this Agreement and as set forth in
Section 3.2(iv).

          "Quoted Price" means the last reported sales price (rounded to the
nearest cent) of the Common Stock as reported by the Nasdaq Stock Market, or if
the Common Stock is listed on a national securities exchange, the last reported
sales price of the Common Stock on such exchange (which shall be for
consolidated trading if applicable to such exchange), or if neither so reported
or listed, the last reported bid price of the Common Stock. In the absence of
one or more such quotations, the Board of Directors of the

                                      -6-


<PAGE>

Company shall determine the Current Market Price on the basis of such 
quotation as it in good faith determines appropriate.

          "Securities" means the shares of Common Stock and Warrants issued and
sold to Buyer at Closing I and at Future Closings and Optional Closings, in
accordance with the terms and conditions of this Agreement. At such Closings,
the Company will issue and sell a number of Warrants (rounded to the nearest
whole Warrant) equal to the number of shares of Common Stock purchased by Buyer
times one-third. Securities shall not include Additional Securities.

          "Securities Act" means the Securities Act of 1933, as amended, and any
successor Federal statute, and the rules and regulations of the Commission
issued under such Act, as they each may, from time to time, be in effect.

          "Value" means, in respect of Securities or Additional Securities sold
to Buyer at a Closing, the total cash consideration paid by Buyer for such sale.

          "Warrants" means the Common Stock Purchase Warrants issued pursuant to
the Warrant Agreement to Buyer in connection with the issuance and sale of
Securities under this Agreement. Each Warrant purchased by Buyer will entitle
Buyer to acquire one share of Common Stock at any time during the five years
subsequent to such purchase at the Exercise Price.

                                  ARTICLE II

                        ISSUANCE AND SALE OF SECURITIES

          2.1 Issuance and Sale of Securities. Upon the terms set forth herein,
during the Initial Period the Company will issue and sell to Buyer, and Buyer
will purchase from the Company, for an aggregate purchase price of up to $60
million payable in immediately available funds and in separate Closings as
provided in Section 3.1, Securities or Additional Securities or both. During the
Optional Period, at the Company's option, Buyer agrees to purchase from the
Company Optional Securities in accordance with the terms set forth below. After
the Collaboration Agreement expires or terminates, Buyer shall not be required
to purchase further Securities or Additional Securities pursuant to this

Agreement.

                                  ARTICLE III

                                   CLOSINGS

          3.1 Closing. The closing of the sale and purchase of the Initial
Securities shall take place in separate closings: (i) Closing I, at 4:00 p.m.
New York time on the Effective Date simultaneously at the offices of the Company
and Buyer or at such other time and place as the parties may agree, and (ii)
Future Closings, subject to the conditions set forth in Section 3.4, on such
dates and times specified by the Company upon not less than 45 trading days'
written notice to the Buyer at the offices of the Company or at such other time
and place as the parties may agree.

     The Optional Closings of the sale and purchase of any Optional Securities
purchased under this Agreement shall take place in separate closings, on such
dates and times specified by the Company during the Optional Period, subject to
the conditions set forth in Sections 3.4 and 3.5, upon not less than 45 trading
days' written notice by the Company to the Buyer or as such other time and place
as the parties may agree.

                                      -7-

<PAGE>

          3.2  Purchase of Securities.

          (i) On the date of Closing I, subject to the satisfaction (or waiver)
of the conditions set forth in Articles VI and VII, the Company shall issue and
sell to Buyer and Buyer shall purchase from the Company 4,350,000 shares of
Common Stock, and Buyer shall also receive 1,450,000 Warrants, for an aggregate
purchase price of $42,934,500. Each Warrant will entitle Buyer to purchase one
share of Common Stock at any time during the five years subsequent to Closing I
at an Exercise Price of $9.87 per share, in accordance with the Warrant
Agreement.

          (ii) During the Initial Period, if (x) the aggregate Value of
Securities and Additional Securities purchased by Buyer pursuant to this
Agreement is less than $60 million and (y) Buyer has not exceeded Buyer's Equity
Limitations, the Company may issue and sell to Buyer, and Buyer shall purchase
from the Company, Securities or Additional Securities to be determined by the
Company with a Value up to the difference between $60 million and the aggregate
Value of Securities or Additional Securities purchased in prior Closings,
subject to satisfaction (or waiver) of the conditions set forth in Section 3.4
and Articles VI and VII.

          (iii) Subject to the Buyer's Equity Limitations, at any time after
Closing I until the end of the Optional Period that the Company issues and sells
Common Stock or other securities convertible or exchangeable into Common Stock
through an underwritten public offering, within 60 days of the closing of such
public offering, the Company may at its sole discretion notify Buyer that the
Company will issue and sell to Buyer, and Buyer will purchase, the same
securities offered and sold in the underwritten public offering on the same
terms and conditions as other purchasers of the underwritten securities in lieu

of Securities that otherwise could be issued and sold to Buyer under this
Agreement; provided, however, that Buyer shall in no case be required to
purchase Additional Securities equal to more than 25% of the securities sold to
other purchasers of such securities pursuant to the registration statement filed
with respect to the offering of the underwritten securities.

          (iv) The Purchase Price of Common Stock issued as part of a sale of
Securities during the Initial Period shall be 122% of the Current Market Price.
The Purchase Price of Common Stock issued as part of a sale of Securities during
the Optional Period shall be the same as the Exercise Price of the Warrant
issued as part of the sale of Securities.

          3.3 Documents to be Delivered. At any Closing, the Company shall
deliver to Buyer a certificate for the Securities being purchased by the Buyer
hereunder dated the date thereof and registered in the name of Buyer, and the
Buyer shall pay the purchase price for the Securities being purchased by the
Buyer hereunder on such date by wire transfer to the Company of immediately
available funds, in accordance with the Company's written wiring instructions,
against delivery of duly executed certificates representing the Securities being
purchased by the Buyer hereunder and the Company shall deliver such certificates
against delivery of such purchase price.

          3.4 Minimum Purchase Required for Future and Optional Closings;
Limitation. During the Initial Period, at any time until Buyer has purchased
Securities or Additional Securities having a Value of $58 million, and
throughout the Optional Period, Buyer will not be required to purchase and the
Company will not be required to issue Securities or Additional Securities or
otherwise conduct a Closing unless such Closing would result in Buyer purchasing
at least 200,000 shares of Common Stock (or Additional

                                      -8-

<PAGE>

Securities convertible into at least 200,000 shares of Common Stock) or paying 
at least $2 million in the aggregate for the purchase of Securities or 
Additional Securities at such Closing. In no event will Buyer be required to 
purchase Securities or Additional Securities under this Agreement more 
frequently than once in any calendar quarter.

          3.5 Purchase of Optional Securities. The Company and Buyer hereby
agree that during the Optional Period, upon not less than 45 trading days'
written notice ("Put Notice"), the Company may issue and sell to Buyer, and
Buyer shall purchase from the Company, such amount of Optional Securities to be
determined by the Company, subject to Buyer's Equity Limitations and the
limitations set forth in Section 3.4 and in the Collateral Agreements (if any).
The Company may, but shall not be required to, give a Put Notice at any time
during the Optional Period, subject to the limitations contained in this
Agreement. The Put Notice shall specify the date, time, and place of the
Optional Closing and any other information that the Company deems relevant.

          3.6 Lock Up. Buyer agrees that during the period beginning Closing I
and ending on the third anniversary of such date (the "Lock-Up Period"), Buyer
will not in any way sell or transfer any Securities or Additional Securities
purchased by Buyer (except to a wholly-owned subsidiary or affiliate of Buyer,

which shall agree to be bound by the provisions of this Agreement and the
Collateral Agreements insofar as they apply hereto), provided, however, Buyer
may sell or transfer such Securities or Additional Securities solely for the
purpose of reducing Buyer's ownership to no more than 20% of the Outstanding
Securities or 20% of the votes represented by the Company's securities.

          3.7  Further Agreements Regarding Buyer's Equity Limitations.

          (i) During the term of this Agreement, Buyer hereby agrees that Buyer
and its affiliates, including any of its pension plans or employee benefit
plans, shall not purchase Common Stock or other equities of the Company
convertible or exercisable into Common Stock other than pursuant to the terms
and conditions of this Agreement. In addition, Buyer agrees that for itself and
its affiliates, including any of its pension plans or employee benefit plans,
that it will not, during the term of this Agreement or the Collateral Agreements
(whichever is later), without the prior written consent of the Company, directly
or indirectly, acquire or own beneficially and/or of record securities of the
Company in excess of the Buyer's Equity Limitations.

          (ii) In the event Buyer directly or indirectly owns beneficially
and/or of record securities of the Company in excess of the Buyer's Equity
Limitations (as a result of no intentional act or fault of Buyer to exceed its
Equity Limitations) and Buyer is in full compliance with the terms and
conditions of this Agreement and the Collateral Agreements, subject to the
limitations set forth in the next succeeding paragraph, then the Company shall
purchase from the Buyer such number of shares of Common Stock and/or Warrants
and/or or Additional Securities so that as a result of such purchase by the
Company, the Buyer shall not own securities of the Company in excess of the
Buyer's Equity Limitations. The Company shall have the sole discretion regarding
the nature and amount of Warrants, Common Stock, or Additional Securities it
purchases under this Section, provided, however, that the Company will purchase
unregistered Common Stock before purchasing registered securities. The purchase
price of any shares of Common Stock or other security convertible or exchangable
into Common Stock purchased by the Company pursuant to this Section 3.7(ii)
shall equal or be determined in the same manner as the then Current Market Price
and the purchase price of any Warrants purchased by the Company from the Buyer
pursuant to this Section 3.7(ii) shall equal the value of the Warrants
determined in accordance with the Black-Scholes model of warrant pricing as set
forth in Appendix A.

                                  -9-


<PAGE>

          (iii) The Company shall not be required to purchase any shares of
Common Stock and/or Warrants and/or Additional Securities pursuant to Section
3.7(ii) in the event that Buyer owns securities of the Company in excess of
Buyer's Equity Limitations as a result of the Company purchasing or retiring
shares of its outstanding capital stock.

                                  ARTICLE IV

                 REPRESENTATIONS AND WARRANTIES OF THE COMPANY


          The Company hereby represents and warrants to Buyer as of the
Effective Date, as of the date of any future closings with respect to Sections
4.1, 4.2, 4.3, 4.4, 4.5, 4.6, 4.7, 4.8, 4.9 (for the period since the most
recent Company SEC report), and 4.10 (except as disclosed in the Company SEC
Reports), and 4.11 (except as disclosed in the Company SEC Reports), and as of
the date of any applicable Optional Closing as follows:

          4.1  Organization and Standing.  The Company has been duly 
incorporated and is validly existing and in good standing under the laws of the
State of New York with the corporate power and corporate authority to own and
lease its property, to conduct its business as conducted by it in the manner
described in the Company SEC Reports (as defined) and to execute and deliver
this Agreement and each of the Collateral Agreements. The Company has corporate
power and authority to perform and to carry out the transactions contemplated by
this Agreement and each of the Collateral Agreements. The Company is qualified
to do business and is in good standing in the State of New York.

          4.2 Capitalization. As of April 30, 1997, the authorized capital stock
of the Company consisted of the following: (a) 60,000,000 shares of Common
Stock, of which (i) 20,855,186 shares were issued and outstanding, (ii)
4,335,824 shares were reserved for future issuance upon conversion of the Class
A Common Stock, each share of the Class A Common Stock being convertible into
one share of Company Common Stock, (iii) 3,328,165 shares were reserved for
future issuance under the Company's 1990 Amended and Restated Long-Term
Incentive Plan, and (iv) 807,400 shares were reserved for future issuance in
accordance with certain warrants issued to Amgen Inc. and Medtronic, Inc.; (b)
40,000,000 shares of Class A Common Stock, of which 4,335,824 were issued and
outstanding; and (c) 30,000,000 shares of Preferred Stock, (i) none of which
were issued and outstanding, and (ii) 100,000 shares of which are reserved for
issuance as Series A Junior Participating Preferred Stock in accordance with the
Rights Agreement dated as of September 20, 1996. Except as set forth in the
Company SEC Reports, no material change in such capitalization has occurred
between April 30, 1997 and the date hereof. All of the issued and outstanding
shares of Common Stock, Class A Common Stock, and Preferred Stock have been duly
authorized, and all of the issued and outstanding shares of the Common Stock and
the Class A Common Stock are validly issued and are fully paid and
non-assessable. Except as set forth in the Company SEC Reports or as provided in
this Agreement, there is not, nor upon the consummation of the transactions
contemplated herein, will there be (i) any subscription, warrant, option,
convertible security, or any other right (contingent or otherwise) to purchase
or acquire any shares of the capital stock of the Company, (ii) any commitment
of the Company to issue any subscription, warrant, option, convertible security,
or other such right or to issue or distribute to holders of any share of its
capital stock any evidence of indebtedness or assets of the Company, or (iii)
any obligation of the Company (contingent or otherwise) to purchase, redeem or
otherwise acquire any shares of its capital stock or any interest therein or to
pay any dividend or make any other distribution in respect thereof. Except as
set forth in the Company SEC Reports or as provided in this Agreement, no person
is entitled to, nor upon the consummation of the transactions contemplated
thereby will any person be entitled to (i) any preemptive or similar right with
respect to the issuance of any capital stock of the Company, or (ii) any

                                     -10-



<PAGE>

rights with respect to the registration of any capital stock of the Company 
under the Securities Act.

          4.3 Issuance of Securities. As of the time of Closing I, the issuance,
sale, and delivery of up to $60 million of Securities under this Agreement have
been duly authorized and the Securities have been reserved for issuance by all
necessary corporate action on the part of the Company (no consent or approval of
the shareholders of the Company being required by law, by the Restated
Certificate of Incorporation or Bylaws of the Company, or the qualification
criteria of the Nasdaq National Market), and the Securities, when so issued,
sold, and delivered against payment therefor in accordance with the provisions
of this Agreement, will be duly and validly issued, fully paid, and
non-assessable and not subject to preemptive or any other similar rights of the
shareholders of the Company or others and free, at time of issuance, of all
restrictions on transfer subject to restrictions on transfer imposed by
applicable federal and state securities laws.

          4.4 Authority for Agreement. The execution, delivery, and performance
by the Company of this Agreement and each of the Collateral Agreements have been
duly authorized by all necessary corporate action, and this Agreement and each
of the Collateral Agreements have been duly executed and delivered and
constitute valid and binding obligations of the Company enforceable in
accordance with their respective terms, subject to bankruptcy or equitable laws
that might affect the enforceability of this Agreement and each of the
Collateral Agreements. The execution and delivery by the Company of this
Agreement and each of the Collateral Agreements, and the consummation by the
Company of the transactions contemplated hereby and thereby (including, without
limitation, the issuance and sale of the Securities), will not violate any
provision of law and will not conflict with or result in any breach of any of
the terms, conditions or provisions of, or constitute a default under, or result
in the creation of any lien, security interest, charge, or encumbrance upon any
of the properties, assets or outstanding capital stock of the Company, under the
Company's Restated Certificate of Incorporation or Bylaws or any indenture,
lease, agreement, or other instrument to which the Company is a party or by
which it or any of its properties is bound, or any decree, judgment, order,
statute, rule, or regulation applicable to the Company.

          4.5 Governmental Consents.  No consent, approval, order, or
authorization of, or registration, qualification, designation, declaration, or
filing with, any governmental or regulatory authority is required on the part of
the Company in connection with the execution and delivery of this Agreement and
each of the Collateral Agreements, and the consummation of the transactions
contemplated hereby and thereby (including, without limitation, the offer,
issue, sale, and delivery of the Securities), except such filings as shall have
been made or consents or approvals obtained prior to and which shall be
effective on and as of the Closing.

     Based on the representations and warranties made by Buyer in Article V of
this Agreement, the offer and sale of the Shares to Buyer will be in compliance
with applicable federal and state securities laws.

          4.6 Litigation. Except as set forth in the Company SEC Reports, there

are no material actions, suits, proceedings, or investigations, either at law or
in equity, or before any commission or other administrative authority in any
United States or foreign jurisdiction, of any kind now pending or, to the best
of the Company's knowledge, threatened or proposed involving the Company or any
of its properties or assets or which questions the validity or legality of the
transactions contemplated hereby, or to the Company's actual knowledge, against
its employees or consultants with respect to the Company's business

                                     -11-


<PAGE>
          4.7  SEC Filings; Financial Statements.

          (a) The Company has filed all forms, reports and documents required to
be filed with the Commission since May 9, 1997 (collectively, the "Company SEC
Reports"). The Company SEC Reports (i) were prepared in all material respects in
accordance with the requirements of the Securities Act or the Exchange Act, as
the case may be, and (ii) did not at the time they were filed (or if amended or
superseded by a filing prior to the date of this Agreement, then on the date of
such filing) contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they were
made, not misleading.

          (b) Each of the financial statements (including, in each case, any
related notes thereto) contained in the Company SEC Reports was prepared in
accordance with generally accepted accounting principles applied on a consistent
basis throughout the periods involved (except as may be indicated in the notes
thereto), and each was complete and correct in all material respects and
presented fairly in all material respects presented the financial position of
the Company as at the respective dates thereof and the results of its operations
and cash flows for the periods indicated, except that the unaudited interim
financial statements were or are subject to normal and recurring year-end
adjustments which were not or are not expected to be material in amount.

          4.8 Brokers. No broker, finder, or investment banker is entitled to
any brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of the Company.

          4.9 No Undisclosed Liabilities. The Company does not have any material
liabilities (absolute, accrued, contingent, or otherwise) except liabilities in
the aggregate adequately provided for in the Company's unaudited balance sheet
(including any related notes thereto) for the quarter ended March 31, 1997
included in the Company's Quarterly Report on Form 10-Q for the quarter year
ended March 31, 1997 (the "March 31, 1997 Balance Sheet").

          4.10 Absence of Changes. Since May 9, 1997, there has been no material
adverse change in the financial condition, business, operations, or assets of
the Company.

          4.11 No Defaults. The Company is not in default (a) under its Restated
Certificate of Incorporation or Bylaws, each as amended or restated to date, or
any indenture, mortgage, lease agreement, contract, purchase order or other

instrument to which it is a party or by which it or any of its property is bound
or affected or in violation of (b) any order, writ, injunction or decree of any
court of any federal, state, municipal, or other governmental department,
commission, board, bureau, agency, or instrumentality, domestic or foreign,
which defaults, either singly or in the aggregate, would have a material adverse
effect on the Company. At the time of the Closing, to the best knowledge of the
Company, there will exist no condition, event, or act which constitutes, or
which after notice, lapse of time or both would constitute, a material default
under any of the foregoing which, either singly or in the aggregate, would have
a material adverse effect on the Company.

          4.12 Offerings. Except as contemplated by this Agreement or the
Company's 1990 Amended and Restated Long-Term Incentive Plan or as otherwise
disclosed by the Company to Buyer, the Company does not have any current plans
or intentions to issue any shares of its capital stock or any other securities
or any securities convertible or exchangeable into shares of Common Stock or any
other securities.

                                      -12-


<PAGE>

                                   ARTICLE V

                  REPRESENTATIONS AND WARRANTIES OF THE BUYER

          Buyer hereby represents and warrants to the Company as follows:

          5.1 Legal Power. Buyer has the requisite legal power to enter into
this Agreement and the Collateral Agreements, to purchase the Securities and or
Additional Securities hereunder, and to carry out and perform its obligations
under the terms of this Agreement and the Collateral Agreements.

          5.2 Due Execution. This Agreement and the Collateral Agreements have
been duly authorized, executed, and delivered by Buyer, and, upon due execution
and delivery by the Company, this Agreement and the Collateral Agreements will
be valid and binding agreements on Buyer enforceable in accordance with their
respective terms, subject to laws of general application relating to bankruptcy,
insolvency, and the relief of debtors and rules of law governing specific
performance, injunctive relief, or other equitable remedies and compliance with
the requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

          5.3  Investment Representations.

          (a) Buyer is acquiring the Securities for its own account, not as
nominee or agent, for investment and not with a view to, or for resale in
connection with, any distribution or public offering thereof within the meaning
of the Securities Act.

          (b) Buyer understands that (i) the Securities have not been registered
under the Securities Act by reason of a specific exemption therefrom, that they
must be held by it indefinitely, and that it must, therefore, bear the economic
risk of such investment indefinitely, unless a subsequent disposition thereof is
registered under the Securities Act or is exempt from such registration; and

(ii) each certificate representing the Securities will be endorsed with the
restrictive legend set forth in the Registration Rights Agreement.

          (c) Buyer is aware of the provisions of Rule 144 promulgated under the
Securities Act which permits limited resale of shares purchased in a private
placement (i) by non-affiliates of a company not less than two (2) years after
such non-affiliate had purchased and paid for the security to be sold, or (ii)
subject to the satisfaction of certain conditions, including, among other
things, the existence of a public market for the shares, the availability of
certain current public information about the Company, the resale occurring not
less than one (1) year after a party has purchased and paid for the security to
be sold, the sale being through a "broker's transaction" or in transactions
directly with a "market maker" (as provided by Rule 144(f)) and the number of
shares being sold during any three-month period not exceeding specified
limitations.

          5.4 Brokerage. There are no claims for brokerage commissions, finders
fees, or similar compensation in connection with the transactions contemplated
by this Agreement based on any arrangement or agreement made by or on behalf of
Buyer.

                                     -13-


<PAGE>

                                  ARTICLE VI

                        CONDITIONS TO CLOSING OF BUYER

          Buyer's obligation to purchase Securities at Closing I and at any
Optional Closing in respect of the purchase and sale of Securities is subject to
the fulfillment to Buyer's satisfaction, at or prior to Closing I, as of the
date of any future closings with respect to Sections 4.1, 4.2, 4.3, 4.4, 4.5,
4.6, 4.7, 4.8, 4.9 (for the period since the most recent Company SEC report),
and 4.10 (except as disclosed in the Company SEC Reports), and 4.11 (except as
disclosed in the Company SEC Reports), and any applicable Optional Closing, of
all of the following conditions, any of which may be waived by Buyer:

          6.1  Representations and Warranties True;  Performance of Obligations.
The representations and warranties made by the Company in Article IV hereof
shall be true and correct on the date of the Closing with the same force and
effect as if they had been made on and as of said date; and the business,
financial condition, operations, and assets of the Company shall not have been
adversely affected in any material way prior to the Closing.

          6.2 Collateral Agreements. The Company and Buyer shall have entered
into a Collaboration Agreement substantially in the form of Exhibit A hereto, a
Warrant Agreement substantially in the form of Exhibit B hereto, and a
Registration Rights Agreement substantially in the form of Exhibit C hereto.

          6.3 Opinion of the Company's Counsel. Buyer shall have received from
the General Counsel to the Company, an opinion letter substantially in the form
attached hereto as Exhibit C, addressed to it, dated the date of the Closing. In
rendering the opinion called for under this Section 6.3, counsel may rely as to

factual matters on certificates of public officials, officers of the Company,
and officers of Buyer.

          6.4 Proceedings and Documents. All corporate and other proceedings in
connection with the transactions required to be performed under this Agreement
at the Closing and all documents and instruments incident to such transactions
shall have been reasonably approved by Buyer and Buyer shall have received all
such counterpart originals or certified or other copies of such documents as it
may reasonably request.

                                  ARTICLE VII

                     CONDITIONS TO CLOSING OF THE COMPANY

          The Company's obligations to issue and sell the Securities or
Additional Securities at each Closing is subject to the fulfillment to the
Company's satisfaction, on or prior to each Closing, of the following
conditions, any of which may be waived by the Company:

          7.1 Representations and Warranties True. The representations and
warranties made by Buyer in Article 4 hereof shall be true and correct on the
date of the Closing, with the same force and effect as if they had been made on
and as of said date.

          7.2 Performance of Obligations. Buyer shall have performed and
complied with all agreements and conditions herein required to be performed or
complied with by it on or before the Closing.

                                     -14-


<PAGE>

          7.3 Qualifications, Legal Investment. All authorizations, approvals or
permits, if any, of any governmental authority or regulatory body of the United
States or of any state that are required to be obtained prior to or at the
Closing in connection with the lawful sale and issuance of the Securities or
Additional Securities pursuant to this Agreement shall have been duly obtained
and shall be effective on and as of the Closing. At the time of the Closing, the
sale and issuance of the Securities or Additional Securities shall be legally
permitted by all laws and regulations to which Buyer and the Company are
subject.

          7.4 Collateral Agreements. The Company and Buyer shall have entered
into a Collaboration Agreement substantially in the form of Exhibit A hereto, a
Warrant Agreement substantially in the form of Exhibit B hereto, and a
Registration Rights Agreement substantially in the form of Exhibit C hereto.

                                 ARTICLE VIII

                                 MISCELLANEOUS

          8.1  Governing Law.  This Agreement shall be governed by and construed
under the laws of the State of New York.


          8.2 Survival. The representations, warranties, covenants and
agreements made herein shall survive the Closing for the period prescribed by
the applicable statute of limitations. All statements as to factual matters
contained in any certificate or other instrument delivered by or on behalf of
the Company pursuant hereto or in connection with the transactions contemplated
hereby shall be deemed to be representations and warranties by the Company
hereunder as of the date of such certificate or instrument.

          8.3 Successors and Assigns. Except as otherwise expressly provided
herein, the provisions hereof shall inure to the benefit or, and be binding
upon, the successors, assigns, heirs, executors and administrators of the
parties hereto.

          8.4 Entire Agreement. This Agreement, the Exhibits hereto, and the
other documents delivered pursuant hereto constitute the full and entire
understanding and agreement along the parties with regard to the subjects hereof
and no party shall be liable or bound to any other party in any manner by any
representations, warranties, covenants or agreements except as specifically set
forth herein or therein. Nothing in this Agreement, express or implied, is
intended to confer upon any party, other than the parities hereto and their
respective successors and assigns, any rights, remedies, obligations or
liabilities under or by reason of this Agreement, except as expressly provided
herein.

          8.5 Separability. In case any provision of this Agreement shall be
invalid, illegal or unenforceable, it shall to the extent practicable, be
modified so as to make it valid, legal and enforceable and to retain as nearly
as practicable the intent of the parties, and the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.

          8.6 Amendment and Waiver. Any term of this Agreement may be amended
and the observance of any term of this Agreement may be waived (either generally
or in a particular instance, either retroactively or prospectively, and either
for a specified period of time or indefinitely), only with the written consent
of the Company and Buyer.

                                     -15-


<PAGE>

          8.7 Delays or Omissions. No reasonable delay or omission to exercise
any right, power or remedy accruing to Buyer upon any breach, default or
noncompliance of the Company under this Agreement shall impair any such right,
power or remedy, nor shall it be construed to be a waiver of any such breach,
default or noncompliance, or any acquiescence therein, or of any similar breach,
default or noncompliance thereafter occurring. It is further agreed that any
waiver, permit, consent or approval of any kind or character on Buyer's part of
any breach, default or noncompliance under this Agreement or any waiver on
Buyer's part of any provisions or conditions of this Agreement must be in
writing and shall be effective only to the extent specifically set forth in such
writing, and that all remedies, either under this Agreement, by law, or
otherwise afforded to buyer, shall be cumulative and not alternative.


          8.8 Notices, etc. Any notices or communications provided for in this
Agreement to be made by either of the Parties to the other shall be in writing,
in English, and shall be made by prepaid air mail with return receipt addressed
to the other at its address set forth below. Any such notice or communication
may also be given by hand or facsimile to the appropriate designation with
confirmation of receipt. Either Party may by like notice specify an address to
which notices and communications shall thereafter be sent. Notices sent by mail
shall be effective upon receipt; notices given by hand shall be effective when
delivered.

          Notices for Regeneron shall be sent to:

                Regeneron Pharmaceuticals, Inc.
                Attn:  Corporate Secretary
                777 Old Saw Mill River Road
                Tarrytown, New York  10591-6707

          With copy to:

                Regeneron Pharmaceuticals, Inc.
                Attn:  General Counsel
                777 Old Saw Mill River Road
                Tarrytown, New York  10591-6707

          Notices for Procter & Gamble shall be sent to:

                Procter & Gamble Pharmaceuticals, Inc.
                Attn:  President
                One Procter & Gamble Plaza
                Cincinnati, Ohio  45202

          With copy to:

                Procter & Gamble Pharmaceuticals, Inc.
                Attn:  Associate General Counsel
                Blue Ash Office Center
                10200 Alliance Road
                Cincinnati, Ohio  45242-4716

          8.9 Titles and Subtitles. The titles of the paragraphs and
subparagraphs of this Agreement are for convenience of reference only and are
not to be considered in construing this Agreement.

                                     -16-



<PAGE>


          8.10 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one instrument. The foregoing Agreement is hereby
executed as of the date first above written.


                          [Signature Page to Follow]


                                     -17-


<PAGE>


     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, as of the day and year first written above.

REGENERON PHARMACEUTICALS, INC.         THE PROCTER & GAMBLE COMPANY

By:____________________________         By:__________________________________

                                     -18-


<PAGE>

                                  APPENDIX A

For Securities sold during the Optional Period, the Exercise Price of the
Warrant shall be determined such that the excess of the Exercise Price over the
Current Market Price equals one-third of the value of the Warrant, rounded to
the nearest whole cent. The value of the Warrant shall be determined using the
Black-Scholes model with the following values:

Term of Warrant:    Five years

Stock Price:        Current Market Price

Dividend:           The actual cash dividend per share of Common Stock paid by
the Company in the immediately prior twelve months

Interest rate:      The interest rate on 5-year Treasury notes as reported in
The Wall Street Journal on the last trading day used to calculate Current Market
Price or, if no such rate is reported for that date, the last day prior to that
date for which such an interest rate is reported. The interest rate shall be the
effective yield on Treasury notes maturing in the same month five years from the
date of calculation or the average of such yields if more than one yield is
reported for that month or the average of the yields for the months closest to
the date of calculation if no yields are reported for that month.

Volatility:         The actual volatility of daily closing bid prices of Common
Stock during the three full calendar years immediately preceding the year in
which the Closing in question occurs.

Example (for illustration only):
If the Current Market Price of Common Stock is $8.50 and the interest rate
(calculated as above) is 6.75%, and the volatility (calculated as above) is 80%,
then for an Exercise Price of a Warrant of $10.35, the value of a Warrant would
be $5.56 (per Black-Scholes) and (1) the excess of the Exercise Price over the
Current Market Price would be $1.85 [$10.35 - $8.50] and (2) one-third of the
value of the Warrant equals $1.85 [$5.56 / 3].

                                     -19-




<PAGE>

                             EXHIBIT 10.2

                           WARRANT AGREEMENT

                            BY AND BETWEEN
                                   
                    REGENERON PHARMACEUTICALS, INC.

                                  and
                                   
                     THE PROCTER & GAMBLE COMPANY

                       Dated as of May 13, 1997

                                  -1-


<PAGE>

                           TABLE OF CONTENTS

SECTION 1.  Warrant Certificates                                          1
SECTION 2.  Execution of Warrant Certificates                             1
SECTION 3.  Registration                                                  1
SECTION 4.  Registration of Transfers and Exchanges                       1
SECTION 5.  Warrants; Exercise of Warrant                                 2
SECTION 6.  Payment of Taxes                                              3
SECTION 7.  Mutilated or Missing Warrant Certificates                     3
SECTION 8.  Reservation of Warrant Shares                                 4
SECTION 9.  Obtaining Stock Exchange Listings                             4
SECTION 10. Adjustment of Exercise Price and Number of Warrant 
              Shares Issuable                                             4
        (a) Adjustment for Change in Capital Stock                        4
        (b) Adjustment for Rights Issue                                   5
        (c) Adjustment for Other Distributions                            6
        (d) Adjustment for Common Stock Issue                             7
        (e) Adjustment for Convertible Securities Issue                   8
        (f) Current Market Price                                          8
        (g) Consideration Received                                        9
        (h) When De Minimis Adjustment May Be Deferred                    9
        (i) When No Adjustment Required                                   9
        (j) Notice of Adjustment                                         10
        (k) Voluntary Reduction                                          10
        (l) Reorganization of Company                                    10
        (m) Company Determination Final                                  11
        (n) When Issuance or Payment May Be Deferred                     11
        (o) Adjustment in Number of Shares                               11
        (p) Form of Warrants                                             12
SECTION 11.    Fractional Interests                                      12
SECTION 12.
    Notices of Warrants                                       12
SECTION 13.    Notices to Company and Warrant Holder                     13
SECTION 14.    Supplements and Amendments                                14
SECTION 15.    Successors                                                14
SECTION 16.    Termination                                               14
SECTION 17.    Governing Law                                             14
SECTION 18.    Benefits of This Agreement                                14
SECTION 19.    Counterparts                                              15
SIGNATURE PAGE                                                           16
EXHIBIT A                                                               A-1

                                  -2-


<PAGE>

THIS WARRANT AGREEMENT (the "Agreement") is dated as of May 13, 1997 and entered
into by and between Regeneron Pharmaceuticals, Inc., a New York corporation (the
"Company"), and The Procter & Gamble Company, an Ohio corporation ("Procter &
Gamble").

          WHEREAS, the Company proposes to issue to Procter & Gamble, or its
designee, Common Stock Purchase Warrants, as hereinafter described (the
"Warrants"), to purchase shares of Common Stock, $.001 par value (the "Common
Stock"), of the Company (the Common Stock issuable on exercise of the Warrants
being referred to herein as the "Warrant Shares"), pursuant to a Securities
Purchase Agreement dated as of the date hereof (the "Securities Purchase
Agreement").

          NOW, THEREFORE, in consideration of the premises and the mutual
agreements herein set forth, the parties hereto agree as follows:

          SECTION 1. Warrant Certificates. The certificates evidencing the
Warrants (the "Warrant Certificates") to be delivered pursuant to this Agreement
shall be in registered form only and shall be substantially in the form set
forth in EXHIBIT A attached hereto.

          SECTION 2. Execution of Warrant Certificates. Warrant Certificates
shall be signed on behalf of the Company by its Chairman of the Board or its
President or a Vice President and by its Secretary or an Assistant Secretary
under its corporate seal. Each such signature upon the Warrant Certificates may
be in the form of a facsimile signature of the present or any future Chairman of
the Board, President, Vice President, Secretary or Assistant Secretary and may
be imprinted or otherwise reproduced on the Warrant Certificates and for that
purpose the Company may adopt and use the facsimile signature of any person who
shall have been Chairman of the Board, President, Vice President, Secretary, or
Assistant Secretary, notwithstanding the fact that at the time the Warrant
Certificates shall be delivered or disposed of he shall have ceased to hold such
office.

          In case any officer of the Company who shall have signed any of the
Warrant Certificates shall cease to be such officer before the Warrant
Certificates so signed shall have been disposed of by the Company, such Warrant
Certificates nevertheless may be delivered or disposed of as though such person
had not ceased to be such officer of the Company; and any Warrant Certificate
may be signed on behalf of the Company by any person who, at the actual date of
the execution of such Warrant Certificate, shall be a proper officer of the
Company to sign such Warrant Certificate, although at the date of the execution
of this Warrant Agreement any such person was not such officer.

          SECTION 3. Registration.  The Company shall number and register the
Warrant Certificates in a register as they are issued.

          SECTION 4. Registration of Transfers and Exchanges. The Company shall
from time to time register the transfer of any outstanding Warrant Certificates
in a Warrant register to be maintained by the Company upon surrender of such
Warrant Certificates accompanied by a written instrument or instruments of
transfer in form satisfactory to the Company, duly executed by the registered

holder or holders thereof or by the duly appointed legal representative thereof
or by a duly authorized attorney. Upon any such registration of transfer, a new
Warrant Certificate shall be issued to the transferee(s) and the surrendered
Warrant Certificate shall be cancelled and disposed of by the Company.

                                  -3-


<PAGE>

          The Warrant holders agree that each certificate representing Warrant
Shares will bear the following legend:

     "THIS WARRANT AND THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
     REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE 
     OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS 
     AND UNTIL, IN THE CASE OF THE SHARES, SUCH SHARES ARE REGISTERED UNDER 
     SUCH ACT OR, IN THE CASE OF THIS WARRANT AND THE SHARES, AN OPINION OF 
     COUNSEL REASONABLY SATISFACTORY TO THE COMPANY IS OBTAINED TO THE EFFECT 
     THAT SUCH REGISTRATION IS NOT REQUIRED."

          The Warrant holders further agree that they shall not offer, sell, or
otherwise transfer the Warrants or Warrant Shares in violation of the foregoing
legend.

          Warrant Certificates may be exchanged at the option of the holder(s)
thereof, when surrendered to the Company at its office for another Warrant
Certificate or other Warrant Certificates of like tenor and representing in the
aggregate a like number of Warrants. Warrant Certificates surrendered for
exchange shall be cancelled and disposed of by the Company.

          In the event that a holder of Warrants (a "Selling Holder") desires to
transfer all or any part of its ownership of Warrants, the Company shall have
the following right of first refusal exercisable in connection with any such
transfer. The Selling Holder shall give the Company written notice specifying
the identify of the proposed purchasers, the number of Warrants to be sold, the
proposed purchase price, and the terms of the proposed purchase (the "Notice").
The Company shall have fifteen (15) days from the date of receiving the Notice
within which to exercise the right to acquire all or part of the Warrants that
are being offered at the price and upon the terms set forth in the Notice. Such
right shall be exercisable by written notice to the Selling Holder. If the
Company elects to purchase all or any part of the Warrants described in the
Notice, the Selling Holder shall consummate such transaction within thirty (30)
days form the date of the Notice, provided, in the event that the Company elects
to exercise its right to purchase part of the Warrants proposed to be sold in
the Notice, that such purchase would not decrease the price of each remaining
Warrant proposed to be sold in the Notice. If the Company does not elect to
purchase all or any part of such offered Warrants, then within sixty (60) days
from the date of the Notice, the Selling Holder may transfer all or part of such
Warrants to the proposed purchaser(s) on the terms and at the purchase price
specified in the Notice.

          Subject to the foregoing right of first refusal of the Company and the
provisions of this Agreement, any holder may transfer all or any part of its
ownership of Warrants, provided that such sale, assignment, pledge, mortgage,

transfer or other disposition is not being made to an entity in the
pharmaceutical or biotechnology business, unless more than 50% of the voting
control of such entity is owned by the transferring holder. Notwithstanding the
foregoing, any holder of Warrants may transfer its Warrants to any wholly-owned
affiliate or subsidiary of such holder, whether now in existence or hereafter
created, formed or organized.

          SECTION 5. Warrants; Exercise of Warrants. A Warrant may be exercised
upon surrender to the Company at its office designated for such purpose (the

                                  -4-


<PAGE>

address of which is set forth in Section 13 hereof) of the certificate or
certificates evidencing the Warrants to be exercised with the form of election
to purchase duly filled in and signed, which signature shall be guaranteed by a
bank or trust company having an office or correspondent in the United States or
a broker or dealer which is a member of a registered securities exchange or the
National Association of Securities Dealers, Inc., and upon payment to the
Company of the exercise price (the "Exercise Price") which will be set forth in
Warrant Certificate, a form of which is attached hereto as Exhibit A, subject to
adjustment pursuant to Section 10, for the number of Warrant Shares in respect
of which such Warrants then exercised. Payment of the aggregate Exercise Price
shall be made in cash or by certified or official bank check payable to the
order of the Company.

          Subject to the provisions of Section 6 hereof, upon such surrender of
Warrants and payment of the Exercise Price the Company shall issue and cause to
be delivered with all reasonable dispatch to or upon the written order of the
holder and in such name or names as the Warrant holder may designate, a
certificate or certificates for the number of full Warrant Shares issuable upon
the exercise of such Warrants together with cash as provided in Section 11;
provided, however, that if any reclassification, consolidation, merger or lease
or sale of assets is proposed to be effected by the Company as described in
subsection (l) of Section 10 hereof, or a tender offer or an exchange offer for
shares of Common Stock of the Company shall be made, upon such surrender of
Warrants and payment of the Exercise Price as aforesaid, the Company shall, as
soon as possible, but in any event not later than two business days thereafter,
issue and cause to be delivered the full number of Warrant Shares issuable upon
the exercise of such Warrants in the manner described in this sentence together
with cash as provided in Section 11. Such certificate or certificates shall be
deemed to have been issued and any person so designated to be named therein
shall be deemed to have become a holder of record of such Warrant Shares as of
the date of the surrender of such Warrants and payment of the Exercise Price.

          The Warrants shall be exercisable, at the election of the holders
thereof, either in full or from time to time in part and, in the event that a
certificate evidencing Warrants is exercised in respect of fewer than all of the
Warrant Shares issuable on such exercise at any time prior to the date of
expiration of the Warrants, a new certificate evidencing the remaining Warrant
or Warrants will be issued and delivered pursuant to the provisions of this
Section and of Section 2 hereof.


          All Warrant Certificates surrendered upon exercise of Warrants shall
be cancelled and disposed of by the Company. The Company shall keep copies of
this Agreement and any notices given or received hereunder available for
inspection by the holders during normal business hours at its office.

          SECTION 6. Payment of Taxes. The Company will pay all documentary
stamp taxes, if any, attributable to the initial issuance of Warrant Shares 
upon the exercise of Warrants.

          SECTION 7. Mutilated or Missing Warrant Certificates. In case any of
the Warrant Certificates shall be mutilated, lost, stolen or destroyed, the
Company may in its discretion issue, in exchange and substitution for and upon
cancellation of the mutilated Warrant Certificate, or in lieu of and
substitution for the Warrant Certificate lost, stolen or destroyed, a new
Warrant Certificate of like tenor and representing an equivalent number of
Warrants, but only upon receipt of evidence reasonably satisfactory to the
Company of such loss, theft or destruction of such Warrant Certificate and
indemnity, if requested, also reasonably satisfactory to it. Applicants for such
substitute Warrant Certificates shall also comply with such other reasonable
regulations and pay such other reasonable charges as the Company may prescribe.

                                  -5-


<PAGE>

          SECTION 8. Reservation of Warrant Shares. The Company will at all
times reserve and keep available, free from preemptive rights, out of the
aggregate of its authorized but unissued Common Stock or its authorized and
issued Common Stock held in its treasury, for the purpose of enabling it to
satisfy any obligation to issue Warrant Shares upon exercise of the Warrants,
the maximum number of shares of Common Stock which may then be deliverable upon
the exercise of all the outstanding Warrants.

          The Company or, if appointed, the transfer agent for the Common Stock
(the "Transfer Agent") and every subsequent transfer agent for any shares of the
Company's capital stock issuable upon the exercise of any of the rights of
purchase aforesaid will be irrevocably authorized and directed at all times to
reserve such number of authorized shares as shall be required for such purpose.
The Company will keep a copy of this Agreement on file with the Transfer Agent
and with every subsequent transfer agent for any shares of the Company's capital
stock issuable upon the exercise of the rights of purchase represented by the
Warrants. The Company will furnish such Transfer Agent a copy of all notices of
adjustments and certificates related thereto, transmitted to each holder
pursuant to Section 12 hereof.

          Before taking any action which would cause an adjustment pursuant to
Section 10 hereof to reduce the Exercise Price below the then par value (if any)
of the Warrant Shares, the Company will take any corporate action which may, in
the opinion of its counsel, be necessary in order that the Company may validly
and legally issue fully paid and nonassessable Warrant Shares at the Exercise
Price as so adjusted.

          The Company covenants that all Warrant Shares which may be issued upon
exercise of Warrants will, upon issue, be fully paid, nonassessable, free of

preemptive rights and free from all documentary stamp taxes, liens, charges and
security interests with respect to the issue thereof.

          SECTION 9. Obtaining Stock Exchange Listings. The Company will from
time to time take all action which may be necessary so that the Warrant Shares,
immediately upon their issuance upon the exercise of Warrants, will be listed on
the principal securities exchanges and markets within the United States of
America, if any, on which other shares of Common Stock are then listed.

          SECTION 10. Adjustment of Exercise Price and Number of Warrant Shares
Issuable. The Exercise Price and the number of Warrant Shares issuable upon the
exercise of each Warrant are subject to adjustment from time to time upon the
occurrence of the events enumerated in this Section 10. For purposes of this
Section 10, "Common Stock" means shares now or hereafter authorized of any class
of common stock of the Company and any other stock of the Company, however
designated, that has the right (subject to any prior rights of any class or
series of preferred stock) to participate in any distribution of the assets or
earnings of the Company without limit as to per share amount, including, without
limitation, the Class A Common Stock, par value $.001, of the Company.

     (a) Adjustment for Change in Capital Stock.

     If the Company:

     (1) pays a dividend or makes a distribution on its Common Stock in shares 
of its Common Stock;

                                  -6-


<PAGE>

     (2) subdivides its outstanding shares of Common Stock into a greater number
of shares; or

     (3) combines its outstanding shares of Common Stock into a smaller number 
of shares;

then the Exercise Price in effect immediately prior to such action shall then be
adjusted in accordance with the formula:

                           O
                 1        --         
Where:          E  = E x A 

          1
         E  =  the adjusted Exercise Price

         E  =  the current Exercise Price

         O  =  the number of shares of Common Stock outstanding prior to such
                 action

         A  =  the number of shares of Common Stock outstanding immediately
                 after such action

          In the case of a dividend or distribution the adjustment shall become
effective immediately after the record date for determination of holders of
shares of Common Stock entitled to receive such dividend or distribution, and in
the case of a subdivision or combination, the adjustment shall become effective
immediately after the effective date of such corporate action.

          If after an adjustment a holder of a Warrant upon exercise of it may
receive shares of two or more classes of capital stock of the Company, the
Company shall determine the allocation of the adjusted Exercise Price between
the classes of capital stock. After such allocation, the exercise privilege, the
number of shares issuable upon such exercise, and the Exercise Price of each
class of capital stock shall thereafter be subject to adjustment on terms
comparable to those applicable to Common Stock in this Section 10.

          Such adjustment shall be made successively whenever any event listed
above shall occur.

         (b)   Adjustment for Rights Issue.

          If the Company distributes any rights, options or warrants to all
holders of its Common Stock entitling them at any time after the record date
mentioned below to purchase shares of Common Stock at a price per share less
than the Current Market Price (as defined in SECTION 10(f)) per share of Common
Stock on that record date, the Exercise Price shall be adjusted in accordance
with the formula:

                          N x P
                    O + -------------           
          1                 M
         E  = E x  ------------------           
                          O + N

where:

          1
         E  = the adjusted Exercise Price.

                                  -7-



<PAGE>

         E  = the current Exercise Price.

         O  = the number of shares of Common Stock outstanding on the record
                date.

         N  = the number of additional shares of Common Stock issuable upon
                exercise of the rights, options or warrants offered.

         P  = the exercise price per share of the additional shares issuable
                upon exercise of the rights, options or warrants.

         M  = the Current Market Price per share of Common Stock on the
                record date.

          The adjustment shall be made successively whenever any such rights,
options or warrants are issued and shall become effective immediately after the
record date for the determination of stockholders entitled to receive the
rights, options or warrants. If at the end of the period during which such
rights, options or warrants are exercisable, not all rights, options or warrants
shall have been exercised, the Exercise Price shall be immediately readjusted to
what it would have been if "N" in the above formula had been the number of
shares actually issued.

     (c)  Adjustment for other Distributions.

     If the Company distributes to all holders of its Common Stock any of its
assets (including but not limited to securities and cash), debt securities,
capital stock, or any rights or warrants to purchase assets, debt securities,
capital stock, or other securities of the Company, the Exercise Price shall be
adjusted in accordance with the formula:


          1           M - F
         E  = E x  -------------           
                        M

where:

          1
         E  = the adjusted Exercise Price.

         E  = the current Exercise Price.

         M  = the Current Market Price per share of Common Stock on the record
                date mentioned below.

         F  = the fair market value on the record date of the assets, debt
                securities, capital stock or rights or warrants applicable to 
                one share of Common Stock. The Board of Directors shall 
                determine the fair market value.

          The adjustment shall be made successively whenever any such

distribution is made and shall become effective immediately after the record
date for the determination of stockholders entitled to receive the distribution.

          This subsection does not apply to (i) dividends, distributions,
combinations or issuances referred to in subsection (a) of this Section 10, (ii)
rights, options or warrants 

                                  -8-


<PAGE>

referred to in subsection (b) of this Section 10, or (iii) non-extraordinary 
quarterly cash dividends distributed to all holders of Common Stock.

     (d)  Adjustment for Common Stock Issue.

          If the Company issues shares of Common Stock for a consideration per
share less than the Current Market Price per share of Common Stock on the date
the Company fixes the offering price of such additional shares, the Exercise
Price shall be adjusted in accordance with the formula:

                              P
                    O + -------------           
                              M
          1
         E  = E x       -------------           
                              A

where:

           1
          E  = the adjusted Exercise Price.

          E  = the then current Exercise Price.

          O  = the number of shares outstanding immediately prior to the 
                 issuance of such additional shares.

          P  = the aggregate consideration received for the issuance of such
                 additional shares.

          M  = the Current Market Price per share of Common Stock on the date of
                 issuance of such additional shares.
 
          A  = the number of shares outstanding immediately after the issuance 
                 of such additional shares.

          The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.

          This subsection (d) does not apply to:

          (1) the exercise of Warrants,


          (2) rights, options, warrants or other distributions referred to in
subsections (b), (c) or (e) of this Section 10,

           (3) Common Stock issued to the Company's directors, employees and
non-employee service providers under bona fide benefit plans adopted by the
Board of Directors and approved by the holders of Common Stock when required by
law, if such Common Stock would otherwise be covered by this subsection (d),

          (4) Common Stock issued in a bona fide public offering pursuant to a
firm commitment underwriting, or

          (5) issuances of shares of Common Stock for a consideration per share
less than 100%, but greater than 92%, of the Current Market Price per share of
Common Stock on the date the Company fixes the offering price of such additional
shares.

                                  -9-


<PAGE>

     (e) Adjustment for Convertible Securities Issue.

          If the Company issues any securities convertible into or exchangeable
for Common Stock (other than securities issued in transactions described in
subsections (b) and (c) of this Section 10) for a consideration per share of
Common Stock initially deliverable upon conversion or exchange of such
securities less than the Current Market Price per share of Common Stock on the
date of issuance of such securities, the Exercise Price shall be adjusted in
accordance with this formula:

                              P
                    O + -------------           
                              M
          1
         E  = E x   -----------------           
                            O + D

where:

           1
          E1 = the adjusted Exercise Price.

          E  = the then current Exercise Price.

          O  = the number of shares outstanding immediately prior to the 
                 issuance of such securities.

          P  = the aggregate consideration received for the issuance of such
                 securities.

          M  = the Current Market Price per share of Common Stock on the date of
                 issuance of such securities.

          D  = the maximum number of shares deliverable upon conversion or in
                 exchange for such securities at the initial conversion or 
                 exchange rate.

          The adjustment shall be made successively whenever any such issuance
is made, and shall become effective immediately after such issuance.

          If all of the Common Stock deliverable upon conversion or exchange of
such securities have not been issued when such securities are no longer
outstanding, then the Exercise Price shall promptly be readjusted to the
Exercise Price which would then be in effect had the adjustment upon the
issuance of such securities been made on the basis of the actual number of
shares of Common Stock issued upon conversion or exchange of such securities.

          This subsection (e) does not apply to convertible securities issued in
a bona fide public offering pursuant to a firm commitment underwriting, nor does
this subsection apply to issuances of any securities convertible into or
exchangeable for Common Stock for a consideration per share of Common Stock
initially deliverable upon conversion or exchange of such securities less than
100%, but greater than 92%, of the Current Market Price per share of Common
Stock on the date of issuance of such securities.

     (f)  Current Market Price.

                                 -10-


<PAGE>

          As used in this Agreement, the "Current Market Price" means the
average (rounded to the nearest cent) of the Quoted Price of the Common Stock
for the 30 consecutive trading days commencing 45 trading days before (and not

including) the date in question. The "Quoted Price" of the Common Stock is the
last reported sales price of the Common Stock as reported by Nasdaq National
Market, or if the Common Stock is listed on a national securities exchange, the
last reported sales price of the Common Stock on such exchange (which shall be
for consolidated trading if applicable to such exchange), or if neither so
reported or listed, the last reported bid price of the Common Stock. In the
absence of one or more such quotations, the Board of Directors of the Company
shall determine the Current Market Price on the basis of such quotations as it
in good faith considers appropriate.

     (g)  Consideration Received.

          For purposes of any computation respecting consideration received
pursuant to subsections (d) and (e) of this Section 10, the following shall
apply:

          (1) in the case of the issuance of shares of Common Stock for cash,
the consideration shall be the amount of such cash, provided that in no case
shall any deduction be made for any commissions, discounts or other expenses
incurred by the Company for any underwriting of the issue or otherwise in
connection therewith;

          (2) in the case of the issuance of shares of Common Stock for a
consideration in whole or in part other than cash, the consideration other than
cash shall be deemed to be the fair market value thereof as determined in good
faith by the Board of Directors (irrespective of the accounting treatment
thereof), whose determination shall be conclusive, and described in a Board
resolution; and

          (3) in the case of the issuance of securities convertible into or
exchangeable for shares, the aggregate consideration received therefor shall be
deemed to be the consideration received by the Company for the issuance of such
securities plus the additional minimum consideration, if any, to be received by
the Company upon the conversion or exchange thereof (the consideration in each
case to be determined in the same manner as provided in clauses (1) and (2) of
this subsection).

     (h)  When De Minimis Adjustment May Be Deferred.

          No adjustment in the Exercise Price need be made unless the adjustment
would require an increase or decrease of at least 1% in the Exercise Price. Any
adjustments that are not made shall be carried forward and taken into account in
any subsequent adjustment.

          All calculations under this Section shall be made to the nearest cent
or to the nearest 1/100th of a share, as the case may be.

     (i)  When No Adjustment Required.

          No adjustment need be made for a transaction referred to in
subsections (a), (b), (c), (d) or (e) of this Section 10 if Warrant holders are
to participate in the transaction on a basis and with notice that the Board of
Directors determines to be fair and appropriate in light of the basis and notice
on which holders of Common Stock participate in the transaction.


                                 -11-


<PAGE>

          No adjustment need be made for any issuances pursuant to the
Securities Purchase Agreement dated May 13, 1997.

          No adjustment need be made for rights to purchase Common Stock
pursuant to a Company plan for reinvestment of dividends or interest.

          No adjustment need be made for a change in the par value or no par
value of the Common Stock.

          If the Company distributes or issues rights to all holders of its
Common Stock pursuant to a shareholder rights plan, then no adjustment shall be
made pursuant to this SECTION 10 upon such distribution or issuance if, upon
exercise of the Warrants, each holder thereof receives the same type and number
of unexpired rights it would have received (as adjusted for any event described
in Section 10(a) or 10(l)) had it exercised its Warrants, and been a holder of
the Warrant Shares issuable upon exercise thereof, prior to the record date for
such distribution or issuance.

     To the extent Warrants become convertible into cash, no adjustment need be
made thereafter as to the cash. Interest will not accrue on the cash.

     (j)  Notice of Adjustment.

     Whenever the Exercise Price is adjusted, the Company shall provide the 
notices required by Section 12 hereof.

     (k)  Voluntary Reduction.

          The Company from time to time may reduce the Exercise Price by any
amount for any period of time if the period is at least 20 days and if the
reduction is irrevocable during the period; provided, however, that in no event
may the Exercise Price be less than the par value of a share of Common Stock.

          Whenever the Exercise Price is reduced pursuant to subsection 10(k),
the Company shall mail to Warrant holders a notice of the reduction. The Company
shall mail the notice at least 15 days before the date the reduced Exercise
Price takes effect. The notice shall state the reduced Exercise Price and the
period it will be in effect.

          A reduction of the Exercise Price does not change or adjust the
Exercise Price otherwise in effect for purposes of subsections (a), (b), (c),
(d) and (e) of this Section 10.

     (l)  Reorganization of Company.

          If any reclassification of the Common Stock of the Company or any
consolidation or merger of the Company with another entity, or the sale or lease
of all or substantially all of the Company's assets to another entity shall be
effected in such a way that holders of the Common Stock of the Company shall be

entitled to receive stock, securities or assets with respect to or in exchange
for such Common Stock, then, as a condition precedent to such reclassification,
consolidation, 

                                 -12-


<PAGE>

merger, sale or lease, lawful and adequate provisions shall be made whereby 
the Warrant holder shall thereafter have the right to purchase and receive 
upon the basis and the terms and conditions specified in this Agreement and in 
lieu of the shares of Common Stock immediately theretofore purchasable and 
receivable upon the exercise of the rights represented hereby, such shares of 
stock, securities or assets as may be issued or payable in such 
reclassification, consolidation, merger, sale or lease with respect to or in
exchange for the number of shares of Common Stock purchasable and receivable
upon the exercise of the rights represented hereby had such rights been
exercised immediately prior thereto, and in any such case appropriate provision
shall be made with respect to the rights and interests of the holders of the
Warrants to the end that the provisions hereof (including without limitation
provisions for adjustments of the Exercise Price and of the number of shares of
Common Stock purchasable and receivable upon the exercise of the Warrant) shall
thereafter be applicable, as nearly as may be, in relation to any shares of
stock, securities or assets thereafter deliverable upon the exercise hereof. The
Company will not effect any such reclassification, consolidation, merger, sale
or lease, unless prior to the consummation thereof the successor corporation (if
other than the Company) resulting from such reclassification, consolidation or
merger or the corporation purchasing or leasing such assets shall assume by a
supplemental Warrant Agreement, executed and mailed or delivered to the holders
of the Warrants at the last address thereof appearing on the books of Company,
the obligation to deliver to such holders such shares of stock, securities or
assets as, in accordance with the foregoing provisions, such holders may be
entitled to purchase.

          If the issuer of securities deliverable upon exercise of Warrants
under the supplemental Warrant Agreement is an affiliate of the formed,
surviving, transferee or lessee corporation, that issuer shall join in the
supplemental Warrant Agreement.

          If this subsection (l) applies, subsections (a), (b), (c), (d) and (e)
of this Section 10 do not apply.

     (m)  Company Determination Final.

          Any determination that the Company or the Board of Directors must make
pursuant to this Section 10 is conclusive.

     (n)  When Issuance or Payment May Be Deferred.

          In any case in which this Section 10 shall require that an adjustment
in the Exercise Price be made effective as of a record date for a specified
event, the Company may elect to defer until the occurrence of such event (i)
issuing to the holder of any Warrant exercised after such record date the
Warrant Shares and other capital stock of the Company, if any, issuable upon

such exercise over and above the Warrant Shares and other capital stock of the
Company, if any, issuable upon such exercise on the basis of the Exercise Price
and (ii) paying to such holder any amount in cash in lieu of a fractional share
pursuant to Section 11; provided, however, that the Company shall deliver to
such holder a due bill or other appropriate instrument evidencing such holder's
right to receive such additional Warrant Shares, other capital stock and cash
upon the occurrence of the event requiring such adjustment.

     (o)  Adjustment in Number of Shares.

          Upon each adjustment of the Exercise Price pursuant to this SECTION
10, each Warrant outstanding prior to the making of the adjustment in the
Exercise Price shall thereafter evidence the right to receive upon payment of
the adjusted Exercise Price that number of shares of Common Stock (calculated to
the nearest hundredth) obtained from the following formula:

                                 -13-


<PAGE>

          1             E
         N  = N x  -------------           
                        1
                       E

where:

           1
          N  = the adjusted number of Warrant Shares issuable upon exercise of a
                 Warrant by payment of the adjusted Exercise Price.

          N  = the number of Warrant Shares previously issuable upon exercise of
                 a Warrant by payment of the Exercise Price prior to adjustment.

           1
          E  = the adjusted Exercise Price.

          E = the Exercise Price prior to adjustment.

     (p)  Form of Warrants.

          Irrespective of any adjustments in the Exercise Price or the number or
kind of shares purchasable upon the exercise of the Warrants, Warrants
theretofore or thereafter issued may continue to express the same price and
number and kind of shares as are stated in the Warrants initially issuable
pursuant to this Agreement.

          SECTION 11. Fractions Interests. The Company shall not be required to
issue fractional Warrant Shares on the exercise of Warrants. If more than one
Warrant shall be presented for exercise in full at the same time by the same
holder, the number of full Warrant Shares which shall be issuable upon the
exercise thereof shall be computed on the basis of the aggregate number of
Warrant Shares purchasable on exercise of the Warrants so presented. If any
fraction of a Warrant Share would, except for the provisions of this SECTION 11,

be issuable on the exercise of any Warrants (or specified portion thereof), the
Company shall pay an amount in cash equal to the Current Market Price on the day
immediately preceding the date the Warrant is presented for exercise, multiplied
by such fraction.

          SECTION 12. Notices to Warrant Holders. Upon any adjustment of the
Exercise Price pursuant to Section 10, the Company shall promptly thereafter (i)
cause to be filed with the Company a certificate of a firm of independent public
accountants of recognized standing selected by the Board of Directors of the
Company (who may be the regular auditors of the Company) setting forth the
Exercise Price after such adjustment and setting forth in reasonable detail the
method of calculation and the facts upon which such calculations are based and
setting forth the number of Warrant Shares (or portion thereof) issuable after
such adjustment in the Exercise Price, upon exercise of a Warrant and payment of
the adjusted Exercise Price, which certificate shall be conclusive evidence of
the correctness of the matters set forth therein, and (ii) cause to be given to
each of the registered holders of the Warrant Certificates at his address
appearing on the Warrant register written notice of such adjustments by
first-class mail, postage prepaid. Where appropriate, such notice may be given
in advance and included as a part of the notice required to be mailed under the
other provisions of this Section 12.

          In case:

     (a)  the Company shall authorize the issuance to all holders of shares of
Common Stock of rights, options or warrants to subscribe for or purchase shares
of Common Stock or of any other subscription rights or warrants; or

                                 -14-


<PAGE>


     (b)  the Company shall authorize the distribution to all holders of shares
of Common Stock of evidences of its indebtedness or assets (other than cash
dividends or cash distributions payable out of earnings or earned surplus or
dividends or distributions payable in shares of Common Stock); or

     (c)  of any consolidation or merger to which the Company is a party and for
which approval of any shareholders of the Company is required, or of the
conveyance or transfer of all or substantially all of the properties and assets
of the Company, or of any reclassification or change of Common Stock issuable
upon exercise of the Warrants (other than a change in par value, or from par
value to no par value, or from no par value to par value, or as a result of a
subdivision or combination), or a tender offer or exchange offer for shares of
Common Stock; or

     (d)  of the voluntary or involuntary dissolution, liquidation or winding 
up of the Company; or

     (e)  the Company proposes to take any action that would require an
adjustment in the Exercise Price pursuant to subsections (a), (b), (c), (d) or
(e) of Section 10 and if the Company does not arrange for Warrant holders to
participate pursuant to subsection (i) of Section 10, or if the Company takes

any action that would require a supplemental Warrant Agreement pursuant to
subsection (l) of Section 10, then the Company shall cause to be given to each
of the registered holders of the Warrant Certificates at his address appearing
on the Warrant register, at least 20 days (or 10 days in any case specified in
clauses (a), (b) or (c) above) prior to the applicable record date hereinafter
specified, or promptly in the case of events for which there is no record date,
by first-class mail, postage prepaid, a written notice stating (i) the date as
of which the holders of record of shares of Common Stock to be entitled to
receive any such rights, options, warrants or distribution are to be determined,
or (ii) the initial expiration date set forth in any tender offer or exchange
offer for shares of Common Stock, or (iii) the date on which any such
consolidation, merger, conveyance, transfer, dissolution, liquidation or winding
up is expected to become effective or consummated, and the date as of which it
is expected that holders of record of shares of Common Stock shall be entitled
to exchange such shares for securities or other property, if any, deliverable
upon such reclassification, consolidation, merger, conveyance, transfer,
dissolution, liquidation or winding up. The failure to give the notice required
by this Section 12 or any defect therein shall not affect the legality or
validity of any distribution, right, option, warrant, consolidation, merger,
conveyance, transfer, dissolution, liquidation or winding up, or the vote upon
any action.

          Nothing contained in this Agreement or in any of the Warrant
Certificates shall be construed as conferring upon the holders thereof the right
to vote or to consent or to receive notice as shareholders in respect of the
meetings of shareholders or the election of Directors of the Company or any
other matter, or any rights whatsoever as shareholders of the Company.

          SECTION 13. Notices to Company and Warrant Holder. Unless otherwise
provided herein, any notice, request, instruction or other document to be given
hereunder by any party to the others shall be in writing and delivered in person
or by courier, telegraphed, telexed or by facsimile transmission (with receipt
confirmed), or mailed by certified mail, postage prepaid, return receipt
requested (such mailed notice to be effective on the date such receipt is
acknowledged), as follows:

                                 -15-


<PAGE>

If to the Company:

          Regeneron Pharmaceuticals, Inc.
          777 Old Saw Mill River Road
          Tarrytown, New York 10591-6707
          Attn: Corporate Secretary
          Telecopy No.: (914) 347-2113

With a copy to:

          Regeneron Pharmaceuticals, Inc.
          777 Old Saw Mill River Road
          Tarrytown, New York 10591-6707
          Attn: General Counsel

          Telecopy No.: (914) 345-7721

If to Warrant Holder:
          The Procter & Gamble Company
          One Procter & Gamble Plaza
          Cincinnati, Ohio 45202
          Attn: President

With a copy to:

          Procter & Gamble Pharmaceuticals, Inc.
          Blue Ash Office Center
          10200 Alliance Road
          Cincinnati, Ohio 45242-4716
          Attn: Associate General Counsel

or to such other place and with such other copies as either party may designate
as to itself by written notice to the others.

          SECTION 14. Supplements and Amendments. The Company may not supplement
or amend this Agreement without the prior written approval of the holders of
Warrant Certificates affected by such supplement or amendment.

          SECTION 15. Successors. All the covenants and provisions of this
Agreement by or for the benefit of the Company shall bind and inure to the 
benefit of its respective successors and assigns hereunder.

          SECTION 16. Termination. This Agreement shall terminate at 5:00 p.m.,
New York time on the fifth anniversary of the issuance of the final Warrant
issued pursuant to the Securities Purchase Agreement dated May 13, 1997.
Notwithstanding the foregoing, this Agreement will terminate on any earlier date
if all Warrants have been exercised.

          SECTION 17. Governing Law. This Agreement and each Warrant Certificate
issued hereunder shall be deemed to be a contract made under the laws of the
State of New York and for all purposes shall be construed in accordance with the
internal laws of said State.

          SECTION 18. Benefits of This Agreement. Nothing in this Agreement
shall be construed to give to any person or corporation other than the Company
and the registered holders of the Warrant Certificates any legal or equitable
right, remedy or claim 

                                 -16-



<PAGE>

under this Agreement; but this Agreement shall be for the sole and exclusive 
benefit of the Company and the registered holders of the Warrant Certificates.

          SECTION 19. Counterparts. This Agreement may be executed in any number
of counterparts and each of such counterparts shall for all purposes be deemed
to be an original, and all such counterparts shall together constitute but one
and the same instrument.

                      [Signature Page To Follow]

                                 -17-


<PAGE>

          IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed, as of the day and year first above written.

                                    REGENERON PHARMACEUTICALS, INC.

                                    By: ________________________________
                                        Name:
                                        Title:

- --------------------------------
Seal

Attest: ________________________
        Secretary

                                    THE PROCTER & GAMBLE COMPANY

                                    By: ________________________________
                                        Name:
                                        Title:

- --------------------------------
Seal

Attest: ________________________
        Secretary

                                 -18-


<PAGE>

                                                                      EXHIBIT A

                     [Form of Warrant Certificate]

THIS WARRANT AND THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL, WITH
RESPECT TO THE SHARES, SUCH SHARES ARE REGISTERED UNDER SUCH ACT OR, WITH
RESPECT TO THIS WARRANT OR THE SHARES, AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY IS OBTAINED TO THE EFFECT THAT SUCH REGISTRATION IS
NOT REQUIRED.

EXERCISABLE ON OR BEFORE 5:00 P.M., NEW YORK TIME, ______________________, 20__

No.                                                                      ______
Warrants

                          Warrant Certificate

                    REGENERON PHARMACEUTICALS, INC.

          This Warrant Certificate certifies that The Procter & Gamble Company.,
or registered assigns, is the registered holder of ___________ Warrants expiring
__________, 20__ (the "Warrants") to purchase Common Stock, $.001 par value (the
"Common Stock"), of Regeneron Pharmaceuticals, Inc., a New York corporation (the
"Company"). Each Warrant entitles the holder to receive from the Company upon
exercise on or before 5:00 p.m. New York Time on ___________ __, 20__, one fully
paid and nonassessable share of Common Stock (a "Warrant Share") at the initial
exercise price (the "Exercise Price") of $_______ payable in lawful money of the
United States of America upon surrender of this Warrant Certificate and payment
of the Exercise Price as defined in the Securities Purchase Agreement at the
office of the Company designated for such purpose, subject to the conditions set
forth herein and in the Warrant Agreement referred to herein.

          No Warrant may be exercised after 5:00 p.m., New York Time on 
______________,200__, and to the extent not exercised by such time such Warrants
shall become void.

                                  A-1


<PAGE>

          The Warrants evidenced by this Warrant Certificate are issued pursuant
to a Warrant Agreement dated as of May 13, 1997 (the "Warrant Agreement"), duly
executed and delivered by the Company, which Warrant Agreement is hereby
incorporated by reference in and made a part of this instrument and is hereby
referred to for a description of the rights, limitation of rights, obligations,
duties and immunities thereunder of the Company and the holders (the words
"holders" or "holder" meaning the registered holders or registered holder) of
the Warrants. A copy of the Warrant Agreement may be obtained by the holder
hereof upon written request to the Company. This Warrant is being issued
pursuant to the Securities Purchase Agreement dated May 13, 1997.


          Warrants may be exercised at any time on or before 5:00 p.m., New York
time on _____________ __, 20__. The holder of Warrants evidenced by this Warrant
Certificate may exercise them by surrendering this Warrant Certificate, with the
form of election to purchase set forth hereon properly completed and executed,
together with payment of the Exercise Price at the office of the Company
designated for such purpose. In the event that upon any exercise of Warrants
evidenced hereby the number of Warrants exercised shall be less than the total
number of Warrants evidenced hereby, there shall be issued to the holder hereof
or his assignee a new Warrant Certificate evidencing the number of Warrants not
exercised. No adjustment shall be made for any dividends on any Common Stock
issuable upon exercise of this Warrant.

          The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price set forth on the face hereof may, subject to certain
conditions, be adjusted. If the Exercise Price is adjusted, the Warrant
Agreement provides that the number of shares of Common Stock issuable upon the
exercise of each Warrant shall be adjusted. No fractions of a share of Common
Stock will be issued upon the exercise of any Warrant, but the Company will pay
the cash value thereof determined as provided in the Warrant Agreement.

          The holders of Warrants are entitled to certain registration rights
with respect to the Common Stock purchasable upon exercise thereof. Said
registration rights are set forth in full in a Registration Rights Agreement
dated as of May 13, 1997, between the Company and Procter & Gamble. A copy of
the Registration Rights Agreement may be obtained by the holder hereof upon
written request to the Company.

          Warrant Certificates, when surrendered at the office of the Company by
the registered holder thereof in person or by legal representative or attorney
duly authorized in writing, may be exchanged, in the manner and subject to the
limitations provided in the Warrant Agreement, but without payment of any
service charge, for another Warrant Certificate or Warrant Certificates of like
tenor evidencing in the aggregate a like number of Warrants.

          Upon due presentation for registration of transfer of this Warrant
Certificate at the office of the Company a new Warrant Certificate or Warrant
Certificates of like tenor and evidencing in the aggregate a like number of
Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided in the Warrant Agreement,
without charge except for any tax or other governmental charge imposed in
connection therewith.

                                  A-2


<PAGE>

          The Company may deem and treat the registered holder(s) thereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, of any distribution to the holder(s) hereof, and for all other
purposes, and the Company shall not be affected by any notice to the contrary.
Neither the Warrants nor this Warrant Certificate entitles any holder hereof to
any rights of a stockholder of the Company.


          This Warrant Certificate shall not be valid unless countersigned by
the Company, as such term is used in the Warrant Agreement.

          This Warrant Certificate shall not be offered, sold or otherwise
transferred in violation of the legend on the first page hereof.

                      [Signature Page To Follow]

                                  A-3


<PAGE>

          IN WITNESS WHEREOF, the Company has caused this Warrant

Certificate to be signed by its President and by its Secretary and has caused
its corporate seal to be affixed hereunto or imprinted hereon.

Dated: _____________ , ____

                                    REGENERON PHARMACEUTICALS, INC.

                                    By: ________________________________
                                        Name:
                                        Title:

                                    By: ________________________________
                                        Name:
                                        Title:

                                  A-4


<PAGE>


                                  S-1

                    [Form of Election to Purchase]

               (To Be Executed Upon Exercise Of Warrant)

          The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to receive ___________ shares of Common
Stock and herewith tenders payment for such shares to the order of REGENERON
PHARMACEUTICALS, INC. in the amount of $___________ in accordance with the terms
hereof. The undersigned requests that a certificate for such shares be
registered in the name of _______________, whose address is ________________ and
that such shares be delivered to ______________________________ whose address is
__________________________________. If said number of shares is less than all of
the shares of Common Stock purchasable hereunder, the undersigned requests that 
a new Warrant Certificate representing the remaining balance of such shares be
registered in the name of [        ], whose address is ________________________,
and that such Warrant Certificate be delivered to ______________________, whose 
address is _________________________________________________________.

                                    Signature: _________________________________

Date: ________________________

                                    Signature Guaranteed: ______________________

                                  -5-


<PAGE>

                               EXHIBIT A

                     [Form of Warrant Certificate]

THIS WARRANT AND THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL, WITH
RESPECT TO THE SHARES, SUCH SHARES ARE REGISTERED UNDER SUCH ACT OR, WITH
RESPECT TO THIS WARRANT OR THE SHARES, AN OPINION OF COUNSEL REASONABLY
SATISFACTORY TO THE COMPANY IS OBTAINED TO THE EFFECT THAT SUCH REGISTRATION IS
NOT REQUIRED.

EXERCISABLE ON OR BEFORE 5:00 P.M., NEW YORK TIME, _______________________, 20__

No. ______ Warrants

                          Warrant Certificate

                    REGENERON PHARMACEUTICALS, INC.

          This Warrant Certificate certifies that The Procter & Gamble Company.,
or registered assigns, is the registered holder of ___________ Warrants expiring
__________, 20__ (the "Warrants") to purchase Common Stock, $.001 par value (the
"Common Stock"), of Regeneron Pharmaceuticals, Inc., a New York corporation (the
"Company"). Each Warrant entitles the holder to receive from the Company upon
exercise on or before 5:00 p.m. New York Time on ___________ __, 20__, one fully
paid and nonassessable share of Common Stock (a "Warrant Share") at the initial
exercise price (the "Exercise Price") of $_______ payable in lawful money of the
United States of America upon surrender of this Warrant Certificate and payment
of the Exercise Price as defined in the Securities Purchase Agreement at the
office of the Company designated for such purpose, subject to the conditions set
forth herein and in the Warrant Agreement referred to herein.

          No Warrant may be exercised after 5:00 p.m., New York Time on _______,
200__, and to the extent not exercised by such time such Warrants shall become
void.

                                  -6-


<PAGE>

          The Warrants evidenced by this Warrant Certificate are issued pursuant
to a Warrant Agreement dated as of May 13, 1997 (the "Warrant Agreement"), duly
executed and delivered by the Company, which Warrant Agreement is hereby
incorporated by reference in and made a part of this instrument and is hereby
referred to for a description of the rights, limitation of rights, obligations,
duties and immunities thereunder of the Company and the holders (the words
"holders" or "holder" meaning the registered holders or registered holder) of
the Warrants. A copy of the Warrant Agreement may be obtained by the holder
hereof upon written request to the Company. This Warrant is being issued
pursuant to the Securities Purchase Agreement dated May 13, 1997.


          Warrants may be exercised at any time on or before 5:00 p.m., New York
time on ____ __, 20__. The holder of Warrants evidenced by this Warrant
Certificate may exercise them by surrendering this Warrant Certificate, with the
form of election to purchase set forth hereon properly completed and executed,
together with payment of the Exercise Price at the office of the Company
designated for such purpose. In the event that upon any exercise of Warrants
evidenced hereby the number of Warrants exercised shall be less than the total
number of Warrants evidenced hereby, there shall be issued to the holder hereof
or his assignee a new Warrant Certificate evidencing the number of Warrants not
exercised. No adjustment shall be made for any dividends on any Common Stock
issuable upon exercise of this Warrant.

          The Warrant Agreement provides that upon the occurrence of certain
events the Exercise Price set forth on the face hereof may, subject to certain
conditions, be adjusted. If the Exercise Price is adjusted, the Warrant
Agreement provides that the number of shares of Common Stock issuable upon the
exercise of each Warrant shall be adjusted. No fractions of a share of Common
Stock will be issued upon the exercise of any Warrant, but the Company will pay
the cash value thereof determined as provided in the Warrant Agreement.

          The holders of Warrants are entitled to certain registration rights
with respect to the Common Stock purchasable upon exercise thereof. Said
registration rights are set forth in full in a Registration Rights Agreement
dated as of May 13, 1997, between the Company and Procter & Gamble. A copy of
the Registration Rights Agreement may be obtained by the holder hereof upon
written request to the Company.

          Warrant Certificates, when surrendered at the office of the Company by
the registered holder thereof in person or by legal representative or attorney
duly authorized in writing, may be exchanged, in the manner and subject to the
limitations provided in the Warrant Agreement, but without payment of any
service charge, for another Warrant Certificate or Warrant Certificates of like
tenor evidencing in the aggregate a like number of Warrants.

          Upon due presentation for registration of transfer of this Warrant
Certificate at the office of the Company a new Warrant Certificate or Warrant
Certificates of like tenor and evidencing in the aggregate a like number of
Warrants shall be issued to the transferee(s) in exchange for this Warrant
Certificate, subject to the limitations provided in the Warrant Agreement,
without charge except for any tax or other governmental charge imposed in
connection therewith.

                                  -7-


<PAGE>

          The Company may deem and treat the registered holder(s) thereof as the
absolute owner(s) of this Warrant Certificate (notwithstanding any notation of
ownership or other writing hereon made by anyone), for the purpose of any
exercise hereof, of any distribution to the holder(s) hereof, and for all other
purposes, and the Company shall not be affected by any notice to the contrary.
Neither the Warrants nor this Warrant Certificate entitles any holder hereof to
any rights of a stockholder of the Company.


          This Warrant Certificate shall not be valid unless countersigned by
the Company, as such term is used in the Warrant Agreement.

          This Warrant Certificate shall not be offered, sold or otherwise
transferred in violation of the legend on the first page hereof.

                      [Signature Page To Follow]

                                  -8-


<PAGE>

          IN WITNESS WHEREOF, the Company has caused this Warrant Certificate 
to be signed by its President and by its Secretary and has caused its 
corporate seal to be affixed hereunto or imprinted hereon.

Dated: _____________ , ____

                                    REGENERON PHARMACEUTICALS, INC.

                                    By: ________________________________
                                        Name:
                                        Title:

                                    By: ________________________________
                                        Name:
                                        Title:

                                  -9-


<PAGE>

                    [Form of Election to Purchase]

               (To Be Executed Upon Exercise Of Warrant)

          The undersigned hereby irrevocably elects to exercise the right,
represented by this Warrant Certificate, to receive ___________ shares of Common
Stock and herewith tenders payment for such shares to the order of REGENERON
PHARMACEUTICALS, INC. in the amount of $___________ in accordance with the terms
hereof. The undersigned requests that a certificate for such shares be
registered in the name of ______________, whose address is _________________ and
that such shares be delivered to ______________________________ whose address is
______________________________. If said number of shares is less than all of the
shares of Common Stock purchasable hereunder, the undersigned requests that a
new Warrant Certificate representing the remaining balance of such shares be
registered in the name of [ ], whose address is ______________________, and that
such Warrant Certificate be delivered to _____________________, whose address is
____________________________________.

                                    Signature: _________________________________

Date: ________________________

                                    Signature: _________________________________

                                    Guaranteed: ________________________________

                                 -10-


<PAGE>

                                 -11-






<PAGE>

                             EXHIBIT 10.3

                     REGISTRATION RIGHTS AGREEMENT

                                between

                    REGENERON PHARMACEUTICALS, INC.
                   and THE PROCTER & GAMBLE COMPANY

                             May 13, 1997



<PAGE>

                           TABLE OF CONTENTS

1.  INTRODUCTION AND CERTAIN DEFINITIONS                         1
2.  SECURITIES SUBJECT TO THIS AGREEMENT                         2
     2.1  REGISTRABLE SECURITIES                                 2
     2.2  HOLDERS OF REGISTRABLE SECURITIES                      2
     2.3  SALE OR TRANSFER OF COMPANY'S COMMON STOCK; LEGEND     3
3.  DEMAND REGISTRATIONS                                         3
     3.1  DEMAND BY HOLDERS                                      3
     3.2  EFFECTIVE REGISTRATION                                 4
     3.3  REGISTRATION STATEMENT FORM                            4
     3.4  SELECTION OF UNDERWRITERS                              4
     3.5  REGISTRATION OF OTHER SECURITIES                       4
     3.6  PRIORITY AMONG HOLDERS OF REGISTRABLE SECURITIES
           IN REQUESTED REGISTRATION                             5
     3.7  DELAY OF REQUESTED REGISTRATION                        5
4.  PIGGYBACK REGISTRATIONS                                      5
     4.1  PARTICIPATION                                          5
     4.2  UNDERWRITER'S CUTBACK                                  6
     4.3  NO EFFECT ON DEMAND REGISTRATIONS                      6
5.  HOLD-BACK AGREEMENTS                                         6
     5.1  RESTRICTIONS APPLICABLE TO COMPANY REGISTRATION        6
     5.2  RESTRICTIONS APPLICABLE TO DEMAND REGISTRATION         7
6.  REGISTRATION PROCEDURES                                      8
7.  ALLOCATION OF EXPENSES                                       9
8.  INDEMNIFICATION                                             10
9.  INFORMATION BY HOLDER                                       11
10. RULE 144 REQUIREMENTS                                       11
11. STANDSTILL AGREEMENT                                        12


                                  -2-


<PAGE>

12. AMENDMENTS AND WAIVERS                                     14
13. NOTICES                                                    14
14. SUCCESSORS AND ASSIGNS                                     14
15. TRANSFER OF CERTAIN RIGHTS                                 14
16. DESCRIPTIVE HEADINGS                                       15
17.
 GOVERNING LAW                                              15
18. COUNTERPARTS                                               15
19. ENTIRE AGREEMENT                                           15
20. SEVERABILITY                                               15
SIGNATURE PAGE                                                 16

                                  -3-



<PAGE>

                     REGISTRATION RIGHTS AGREEMENT

    This Registration Rights Agreement, is made as of May 13, 1997, by and
between Regeneron Pharmaceuticals, Inc., a New York corporation (the "Company"),
and The Procter & Gamble Company, an Ohio corporation (the "Purchaser").

    1. Introduction and Certain Definitions. The Company is a party to a
Securities Purchase Agreement (the Securities Purchase Agreement), dated May 13,
1997, with the Purchaser and pursuant to which the Company has agreed, among
other things, to issue shares of its common stock, par value .001 per share (the
Common Stock) and warrants to purchase shares of Common Stock, to the Purchaser.
This Agreement shall become effective upon the issuance of such securities to
the Purchaser pursuant to the Securities Purchase Agreement. Certain capitalized
terms used in this Agreement are defined below; references to sections shall be
to sections of this Agreement. Terms not otherwise defined herein shall have the
meanings assigned to them in the Securities Purchase Agreement.

1.1.  As used in this Agreement, the following terms shall have the following
respective meanings:

     "Affiliate" means any corporation, company, partnership, joint venture,
or other entity which controls, is controlled by, or is under common
control with Purchaser. For purposes of this definition control shall
mean the direct or indirect ownership of at least fifty (50%) percent
or, if less than fifty (50%) percent, the maximum percentage as allowed
by applicable law of (a) the shares of capital stock entitled to vote
for the election of directors, or (b) ownership interest.

     "Agent" means any Person authorized to act on behalf of Purchaser with
respect tot he transactions contemplated by this Agreement.

     "Collaboration Agreement" means that certain Collaboration Agreement,
dated May 13, 1997 between Regeneron Pharmaceuticals, Inc. and The
Procter & Gamble Company. The Effective Date of the Collaboration
Agreement, as that term is defined therein, shall also be referred to
herein as the "Effective Date" hereof.

    "Commission" means the Securities and Exchange Commission, or any other
Federal agency at the time administering the Securities Act.

     "Exchange Act" means the Securities Exchange Act of 1934, as amended,
and any successor Federal statute, and the rules and regulations of the
Commission issued under such Act, as they each may, from time to time,
be in effect.

     "NASD" means the National Association of Securities Dealers, Inc.

     "Person" means an individual, partnership, corporation, limited liability
company, trust or incorporated organization, or other business entity, or a
government or agency or political subdivision thereof.

     "Prospectus" means the prospectus included in any Registration

Statement, as amended or supplemented by any prospectus supplement with
respect to the terms of the offering of any portion of the Registrable
Securities covered by the Registration Statement and by all other
amendments and supplements to the prospectus, including post-effective
amendments and all material incorporated by reference in such
prospectus.

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<PAGE>

     "Registrable Securities" means (i) the Common Stock and the Warrant
Shares acquired by the Purchaser pursuant to the Securities Purchase
Agreement (ii) any other shares of Common Stock of the Company issued in
respect of such shares (because of stock splits, stock dividends,
reclassifications, recapitalization, or similar event); provided,
however, that shares of Common Stock which are Registrable Securities
shall cease to be Registrable Securities upon any sale of such shares
pursuant to a Registration Statement, Section 4(1) of the Securities
Act, or Rule 144 under the Securities Act, or any sale in any manner to
a person or entity which is not entitled to the rights provided by this
Agreement, or when such Registrable Securities shall have been otherwise
transferred, new certificates for them not bearing a legend restricting
transfer under the Securities Act shall have been delivered by the
Company and they may be publicly resold without subsequent registration
under the Securities Act or in compliance with Rule 144 thereunder;
provided, further, however, that any securities that have ceased to be
Registrable Securities cannot thereafter become Registrable Securities.

     "Registration" means a registration of the Company's securities for sale
to the public under a Registration Statement.

     "Registration Statement" means a registration statement filed by the
Company with the Commission for a public offering and sale of securities
of the Company (other than a registration statement on Form S-8 or Form
S-4, or their successor forms, or any other form for a limited purpose,
or any registration statement covering only securities proposed to be
issued in exchange for securities or assets of another corporation).

    "Registration Expenses" means the expenses described in subsection 2.3.

    "Securities Act" means the Securities Act of 1933, as amended, and any
successor Federal statute, and the rules and regulations of the
Commission issued under such Act, as they each may, from time to time,
be in effect.

     "Underwritten Registration or Underwritten Offering" means a
Registration in which the securities of the Company are sold to an
underwriter for reoffering to the public.

     "Warrant Shares" means any shares of Common Stock issued or issuable upon
exercise of any of the Warrants.

    2  Securities Subject to this Agreement.


    2.1 Registrable Securities. The securities entitled to the benefits of
this Agreement are the Registrable Securities. The rights of the holders of the
Registrable Securities may be limited by rights of other holders of the
Company's securities who entered into agreements with the Company before the
effective date of this Agreement including, without limitation, the rights
obtained by Amgen Inc. in a certain Registration Rights Agreement dated April
15, 1996 with the Company.

    2.2 Holders of Registrable Securities. A Person is deemed to a holder
of Registrable Securities whenever such Person owns Registrable Securities or
has the right to acquire such Registrable Securities, whether or not such
ownership or right was acquired pursuant to the Securities Purchase Agreement or
the Warrant Agreement, and whether or not such acquisition has actually been
effected and disregarding any legal restrictions upon the exercise of such
right.

                            -5-


<PAGE>

    2.3  Sale or Transfer of Company's Common Stock; Legend.

         (a) The Registrable Securities shall not be sold or transferred
unless either (i) they first shall have been registered under the Securities
Act, or (ii) the Company first shall have been furnished with an opinion of
legal counsel, reasonably satisfactory to the Company, to the effect that such
sale or transfer is exempt from the registration requirements of the Securities
Act.

         (b) Notwithstanding the foregoing, no registration or opinion of
counsel shall be required for a transfer made in accordance with Rule 144 under
the Securities Act.

         (c) Each certificate representing the Registrable Securities shall bear
a legend substantially in the following form:

         The shares represented by this certificate have not been registered
    under the Securities Act of 1933, as amended, and may not be
    offered, sold, or otherwise transferred, pledged, or hypothecated
    unless and until such shares are registered under such Act or an
    opinion of counsel reasonably satisfactory to the Company is
    obtained to the effect that such registration is not required.
    Additionally, the transfer of these shares is subject to the
    conditions specified in the Registration Rights Agreement dated as
    of May 13, 1997, between Regeneron Pharmaceuticals, Inc. and The
    Procter & Company, and no transfer of these shares shall be valid or
    effective until such conditions have been fulfilled. Upon the
    fulfillment of such conditions, Regeneron Pharmaceuticals, Inc., has
    agreed to deliver to the holder hereof a new certificate for the
    shares represented hereby registered in the name of the holder
    hereof. Copies of such agreement may be obtained at no cost by
    written request made by the holder of record of this certificate to
    the secretary of Regeneron Pharmaceuticals, Inc.


    The foregoing legend shall be removed from the certificates representing any
Registrable Securities, at the request of the holder thereof, at such time as
such shares become eligible for resale pursuant to Rule 144(k) under the
Securities Act or such shares become publicly tradable pursuant to an effective
Registration Statement.

    3.   Demand Registrations.

    3.1 Demand by Holders. The holders of a majority of Registrable
Securities, at any time from and after the third anniversary of the Effective
Date, may make a total of two written requests to the Company for Registration
of Registrable Securities under and in accordance with the provisions of the
Securities Act of all or part of the Registrable Securities. Any such
Registration requested shall hereinafter be referred to as a "Demand
Registration." Each request for a Demand Registration shall specify the kind and
aggregate amount of Registrable Securities to be registered and the intended
methods of disposition thereof. Upon such request for a Demand Registration, the
Company shall use its best efforts to promptly effect the Registration of such
Registrable Securities under (i) the Securities Act, and (ii) subject to Section
6, the blue sky laws of such jurisdictions as any holder of such Registrable
Securities requesting such Registration or any underwriter, if any, may
reasonably request. The Company shall also use its best efforts to have all such
Registrable Securities registered with or approved by such other federal or
state governmental agencies or authorities as may be necessary in the opinion of
counsel to the Company and counsel to the holders of a majority of such
Registrable Securities to consummate the disposition of such Registrable
Securities.

    Notwithstanding the foregoing, the Company shall not be obligated to
effect a Demand Registration if all (but not less than all) of the shares
requested to be registered could

                            -6-


<PAGE>

immediately be sold by such holders under Rule 144 under the Securities
Act at a price substantially equivalent to the prevailing market price.
The final determination of whether all of the shares could immediately
be sold under Rule 144 shall be made in good faith by counsel for
holders of the Registrable Securities after, among other things,
considering the possible affiliate status of any such holder. The
Company shall have the burden of establishing that the shares could
immediately be sold at a price substantially equivalent to the
prevailing market price. Any request for a Demand Registration not
effected pursuant to the provisions of this paragraph shall not count
against the two requests specified in the preceding paragraph.

    3.2 Effective Registration. Subject to the last paragraph of Section
6, the Company shall be deemed to have effected a Demand Registration if the
Registration Statement relating to such Demand Registration is declared
effective by the SEC and remains effective for at least 90 days; provided,
however, that no Demand Registration shall be deemed to have been effected if

(i) such registration, after it has become effective, is interfered with by any
stop order, injunction or other order or requirement of the SEC or other
governmental agency or court for any reason not attributable to the selling
holders of Registrable Securities, or (ii) the conditions to closing specified
in the purchase agreement or underwriting agreement entered into in connection
with such registration are not satisfied, other than by reason of a failure on
the part of the selling holders of Registrable Securities or any underwriter
referred to in Section 3.4.

    3.3 Registration Statement Form. Registrations under this Section 3
shall be on such appropriate registration form of the SEC as shall permit the
disposition of such Registrable Securities in accordance with the intended
method or methods of disposition specified in such holders' requests for such
Registration. If, in connection with any Registration under this Section 3 which
is proposed by the Company to be on Form S-3 or any successor form to such Form,
the managing underwriter (if any) or holders of a majority of the Registrable
Securities requesting a Demand Registration shall advise the Company in writing
that in its opinion additional disclosure not required by such form is of
material importance to the success of the offering, then such Registration shall
include such additional disclosure.

    3.4 Selection of Underwriters. If at any time or from time to time
during the time period applicable to Demand Registrations any of the holders of
the Registrable Securities covered by a Registration Statement desire to sell
Registrable Securities in an Underwritten Offering, the investment banker or
investment bankers that will manage the offering will be selected as follows:

         (a) Managing Underwriter. A majority of the holders of
Registrable Securities shall select three (or, if such holder(s) desires, more
than three) nationally recognized investment banking firms as candidates for the
offering, each of which is ready, willing and able to act as the managing
underwriter, and shall provide a list of such candidates to the Company. Not
later than five business days following the receipt of such list, the Company
shall: (i) choose one of three candidates to act as the managing underwriter for
the offering and (ii) notify the holders of a majority of Registrable Securities
of such choice.

         (b) Co-Managers. The investment banking firm(s), if any, that
will serve as co-manager(s) of the offering will be selected by holders of a
majority of Registrable Securities.

    3.5 Registration of Other Securities. Whenever the Company shall
effect a Registration pursuant to this Section 3 in connection with an
Underwritten Offering by one or more holders of Registrable Securities, no
securities other than Registrable Securities shall be included among the
securities covered by such Registration if the managing underwriter of such
offering shall have advised each selling holder of Registrable Securities to be
covered by such Registration in writing (with a copy to the Company) that, in
its opinion, the number of securities requested to

                            -7-


<PAGE>


be included in such Registration exceeds the number which can be sold in
such offering within a price range acceptable to the selling holders of
a majority of the Registrable Securities requested to be included in
such Registration. If no such notice or letter is provided, the Company
may include shares of Common Stock for its own account or for the
account of other shareholders of the Company having the right to include
such shares in a Registration Statement filed by the Company with the
SEC.

    3.6  Priority Among Holders of Registrable Securities in Requested
Registration. If the managing underwriter of an Underwritten Offering pursuant
to this Section 3 advises each of the holders of Registrable Securities in
writing (with a copy to the Company) that less than all of the Registrable
Securities proposed to be included in such offering should be included (using
the same standard described in subsection 3.5 hereof), then the amount of
Registrable Securities to be offered for the accounts of holders of Registrable
Securities shall be reduced pro rata, based on the number of Registrable
Securities owned by such holders.

    3.6 Delay of Requested Registration. Notwithstanding anything to the
contrary contained in this Section 3, if following a request for a Demand
Registration the Company provides prompt written notification to all holders of
Registrable Securities specifying the nature of any Delay Event described below,
then the filing of the Registration Statement pursuant to the request for Demand
Registration may be delayed by the Company for a period not to exceed six months
from the date of its receipt of the written request for the Demand Registration
or such shorter period provided below; provided, however, that such right to
delay a request may be exercised by the Company not more than once in any two
year period. A "Delay Event" shall be defined as any of the following: (1) the
Company will file within 60 days following its receipt of the written request
for Demand Registration, a Registration Statement for the public offering of
securities for the account of the Company; (2) if the Securities Act or the
rules or regulations thereunder, or the form on which the Registration Statement
for the Demand Registration is to be filed, requires the filing of financial
statements which are not yet available (in which case, the Company shall prepare
or cause such statements to be prepared in a reasonably timely and diligent
manner and promptly thereafter file the Registration Statement); (3) at the time
of the request for Demand Registration, the Company is engaged in a material
transaction or has an undisclosed material corporate development, and in either
case, which would be required to be disclosed under the federal securities laws
in the Registration Statement, but the Company's Board of Directors has made a
good faith determination that making such disclosure at such time would
materially adversely affect such transaction or development (in which case, the
Company shall disclose the matter as promptly as practicable and promptly
thereafter file the Registration Statement); or (4) at the time of the request
of the Demand Registration, the Company is engaged in any financing (except the
type described in clause (1) above) (in which case the Company shall file the
Registration Statement no later than 30 days following its receipt of the
written request for Demand Registration).

    4.   Piggyback Registrations.

    4.1 Participation. Subject to Section 4.2 hereof, if at any time from
and after the third anniversary of the Effective Date, the Company proposes to

file a Registration Statement under the Securities Act with respect to any
offering of any of its shares of Common Stock, whether or not by the Company for
its own account (other than (i) a registration on Form S-4 (or otherwise in
connection with non-cash offerings, exchange offers, mergers or
recapitalizations) or S-8 or any successor form to such Forms, or (ii) any
registration of securities as it relates to an offering and sale to directors or
employees of, or non-employee service providers to, the Company under bona fide
benefits plans adopted by the Board of Directors of the Company and approved by
the holders of Common Stock when required by law), then, as promptly as
practicable, the Company shall give written notice of such proposed filing to
each holder of Registrable Securities

                            -8-


<PAGE>

and such notice shall offer the holders of Registrable Securities the
opportunity to register such number of Registrable Securities as each
such holder may request (a "Piggyback Registration"). Subject to Section
4.2, the Company shall include in such Registration Statement all
Registrable Securities requested within 15 days after the receipt of any
such notice (which request shall specify the Registrable Securities
intended to be disposed of by such holder) to be included in the
Registration for such offering pursuant to a Piggyback Registration.
Notwithstanding the foregoing, the Company shall not be obligated to
include in a Piggyback Registration the shares of Registrable Securities
requested to be included by a holder of Registrable Securities if: (i)
all (but not less than all) of the shares requested to be included by
that holder could immediately be sold by that holder under Rule 144
under the Securities Act at a price substantially equivalent to the
prevailing market price and (ii) the Company provides to that holder a
written waiver and consent allowing such holder to sell or otherwise
dispose of all of such shares requested to be included without
limitation to the restrictions imposed by Section 5.1 hereof. The final
determination of whether all of the shares could immediately be sold
under Rule 144 shall be made in good faith by counsel for such holder
after, among other things, considering the possible affiliate status of
such holder. The Company shall have the burden of establishing that the
shares could immediately be sold at a price substantially equivalent to
the prevailing market price. Each holder of Registrable Securities shall
be permitted to withdraw all or part of such holder's Registrable
Securities from a Piggyback Registration at any time prior to the
effective date thereof.

    4.2 Underwriter's Cutback. The Company shall use its best efforts to
cause the managing underwriter or underwriters of a proposed Underwritten
Offering to permit the Registrable Securities requested to be included in the
Registration for such offering under Section 4.1 (the "Piggyback Securities"),
to be included on the same terms and conditions as any similar securities
included therein. Notwithstanding the foregoing, if the managing underwriter of
any such proposed Underwritten Offering informs the Company and the holders of
such Piggyback Securities in writing that, in its opinion, the number of shares
of Common Stock (including the Piggyback Securities) requested to be included in
such Registration exceeds the number which can be sold in such offering within a

price range acceptable to the party who has requested the filing of the
Registration Statement (the Company or other holders of the Company's Common
Stock, as the case may be, hereafter referred to as the "Requesting Party"),
then the shares of Common Stock to be included in such Registration shall be the
number that can be sold within a price range acceptable to the Requesting Party,
selected (i) first, from the shares of Common Stock originally proposed by the
Requesting Party to be included in the Registration for such offering, (ii)
second, and only if all the shares of Common Stock referenced in clause (i) have
been included, from shares of Common Stock subject to piggyback registration
rights originally proposed to be included by all holders of shares of Common
Stock (other than the Requesting Party), selected pro rata based upon the total
ownership of such shares of Common Stock subject to piggyback registration
rights of such holders, and (iii) third, and only if all of the shares of Common
Stock referenced in clause (ii) have been included, from any other securities
eligible for inclusion in such Registration.

    4.3 No Effect on Demand Registrations. No Registration of Registrable
Securities effected pursuant to a request under this Section 4 shall be deemed
to have been effected pursuant to Section 3 hereof or shall relieve the Company
of its obligation to effect any Registration upon request under Section 3
hereof.

    5.   Hold-Back Agreements.

    5.1  Restrictions Applicable to Company Registration.

         (a) Restrictions Applicable to Holders of Registrable Securities. Each

                            -9-


<PAGE>

holder of Registrable Securities, if requested by the Company and, in the
case of an Underwritten Offering, the managing underwriters, shall agree not to
sell, transfer or otherwise dispose of any Registrable Securities or other
equity securities (or any securities convertible, exchangeable or exercisable
for such equity securities) of the Company beneficially owned by it (except, in
either case, those that are included in a Piggyback Registration) for a
specified period of time (the "Holdback Period") in the event that the Company
notifies such holder that it desires to file a Registration Statement (the
"Company Registration Statement") to register the sale of shares of Common Stock
(or any securities convertible, exchangeable or exercisable for such Common
Stock) (other than a Registration referred to in clause (i) or (ii) of Section
4.1. The Holdback Period shall commence on the date the Company Registration
Statement is declared effective by the SEC and shall terminate 120 days
thereafter. A written agreement (the "Lock Up") memorializing each such holder's
agreement to the foregoing restrictions shall be executed in a form reasonably
satisfactory to the Company and, if applicable, the managing underwriters.

         (b) Restrictions Applicable to Officers, Directors and Other
Stockholders. As a condition to each holder's delivery of the Lock Up pursuant
to Section 5.1., the Company shall use its best efforts to obtain from each of
its: (i) officers, (ii) directors and (iii) shareholders beneficially owning at
least as many shares of Common Stock as the aggregate number of shares

beneficially owned by the holders of Registrable Securities, a written agreement
substantially similar to the Lock Up pursuant to which each such Person shall
agree not to sell, transfer or otherwise dispose of any equity securities (or
any securities convertible, exchangeable or exercisable for such equity
securities) of the Company beneficially owned by it under the same terms as the
Lock Up (excluding shares that are included in a Piggyback Registration);
provided however, that each of the officers and directors may sell, transfer or
dispose of during the Holdback Period the amount of equity securities of the
Company that each would be permitted to sell under Rule 144 during a 90 day
period commencing on the effective date of the Company Registration Statement.

    5.2 Restrictions Applicable to Demand Registration. The following
restrictions on the sale, transfer or other disposition of the Company's equity
securities (or any securities convertible, exchangeable or exercisable for such
equity securities) by the Company, its officers and directors, certain other
shareholders and holders of Registrable Securities shall apply in the event of a
Demand Registration:

         (a)  Registration Restrictions Applicable to the Company.  The
Company, if requested by the holders of a majority of Registrable Securities
and, in the case of an Underwritten Offering, the managing underwriters, shall
agree not to effect any public sale or distribution of its equity securities (or
any securities convertible, exchangeable, or exercisable for such equity
securities) (except those that may be included in a Piggyback Registration) or
any private offer, sale or distribution of its equity securities (or any
securities convertible, exchangeable or exercisable for such equity securities)
that may be integrated under the federal securities laws or the regulations
thereunder with a Demand Registration, for the Demand Registration Holdback
Period in the event of a Demand Registration. The "Demand Registration Holdback
Period" shall be defined as the period commencing on the date that the
Registration Statement for the Demand Registration is declared effective by the
SEC and shall terminate 120 days thereafter. A written agreement memorializing
the Company's agreement to the foregoing restrictions shall be executed in a
form reasonably satisfactory to the holders of a majority of Registrable
Securities and, if applicable, the managing underwriters.

         (b) Restrictions Applicable to Officers and Directors. The
Company, if requested by the holders of a majority of Registrable Securities
and, in the case of an Underwritten Offering, the managing underwriters, shall
cause Dr. Leonard Schleifer (so long as he remains the Chief Executive Officer
of the Company), and shall use its best efforts to cause each of its other
officers and directors, to agree not to sell, transfer or otherwise dispose of
any equity securities (or

                            -10-


<PAGE>

any securities convertible, exchangeable, or exercisable for such equity
securities) of the Company beneficially owned by each such Person
(except those that may be included in a Piggyback Registration) during
the Demand Registration Holdback Period in the event of a Demand
Registration; provided, however, that all such officers and directors in
the aggregate may sell, transfer or otherwise dispose of an aggregate of

up to five percent of the total number of shares included in the Demand
Registration. A written agreement memorializing each such Person's
agreement to the foregoing restrictions shall be executed in a form
reasonably satisfactory to the holders of a majority of Registrable
Securities and, if applicable, the managing underwriters.

         (c) Restrictions Applicable to Other Stockholders. The Company,
if requested by the holders of a majority of Registrable Securities and, in the
case of an Underwritten Offering, the managing underwriters, shall cause each
holder of its privately placed equity securities (or any securities convertible,
exchangeable, or exercisable for such equity securities) issued by the Company
at any time on or after the date of this Agreement to agree (for the benefit of
the holders of Registrable Securities) not to effect any public sale or
distribution of any such securities during the Demand Registration Holdback
Period in the event of a Demand Registration. In addition, the Company shall use
its best efforts to cause each such other shareholder of the Company
beneficially owning at least five percent of the Company's then outstanding
equity securities (or any securities convertible, exchangeable, or exercisable
for such equity securities) to agree not to effect any public sale or
distribution of equity securities (or any securities convertible, exchangeable,
or exercisable for such equity securities) of the Company during the Demand
Registration Holdback Period in the event of a Demand Registration. A written
agreement memorializing each such Person's agreement to the foregoing
restrictions shall be executed in a form reasonably satisfactory to the holders
of a majority of Registrable Securities and, if applicable, the managing
underwriters.

         (c) Restrictions Applicable to the Holders of Registrable
Securities. The holders of the Registrable Securities shall not sell, transfer
or otherwise dispose of any equity securities (or any securities convertible,
exchangeable or exercisable for such equity securities) of the Company
beneficially owned by them during a Demand Registration Holdback Period in the
event of any Demand Registration, except for those securities included in the
Demand Registration.

    6.   Registration Procedures.  If and whenever the Company is required by
the provisions of this Agreement to use its best efforts to effect the
registration of any of the Registrable Securities under the Securities Act, the
Company shall:

         (a) file with the Commission a Registration Statement with respect to
such Registrable Securities and use reasonable efforts to cause the Registration
Statement to become and remain effective;

         (b) prepare and file with the Commission any amendments and
supplements to the Registration Statement and the prospectus included in the
Registration Statement as may be necessary to comply with the provisions of the
Securities Act and keep the Registration Statement effective for a period of not
less than one hundred twenty (120) days from the effective date;

         (c) furnish to the Purchaser such reasonable numbers of copies of the
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Securities Act, and such other documents as the Purchaser
may reasonably request in order to facilitate the public sale or other

disposition of the Registrable Securities owned by the Purchaser.

    If the Company has delivered preliminary or final prospectuses to the
Purchaser and after having done so the prospectus is amended to comply with the
requirements of the Securities Act, the Company shall promptly notify the
Purchaser and, if requested, the Purchaser shall

                            -11-


<PAGE>

immediately cease making offers of Registrable Securities and return all
prospectuses to the Company. The Company shall promptly provide the
Purchaser with revised prospectuses and, following receipt of the
revised prospectuses, the Purchaser shall be free to resume making
offers of the Registrable Securities;

         (d) use its best efforts to register or qualify the Registrable
Securities covered by the Registration Statement under securities or Blue Sky
laws of such states as the Purchaser shall reasonably request, and do any and
all other acts and things that may be necessary or desirable to enable the
Purchaser to consummate the public sale or other disposition in such states of
the Registrable Securities owned by the Purchaser; provided, however, that the
Company shall not be required in connection with this paragraph (d) to qualify
as a foreign corporation or execute a general consent to service of process in
any jurisdiction, nor shall it be required to comply with any Blue Sky or other
laws, rules or regulations of any jurisdiction for which compliance or other
requirements are, in the reasonable judgment of the Company, unduly burdensome
or would require any material adjustments in any terms of the offering or in the
offering documents; and

         (e) In the event of an underwritten public offering, enter into and
perform its obligations under an underwriting agreement, in usual and customary
form, with the managing underwriter of such offering. The Purchaser shall also
enter into and perform its obligations under such agreement.

         (f) Each holder of Registrable Securities agrees by acquisition of
such Registrable Securities that, upon receipt of any notice from the Company of
the happening of the existence of any fact which results in the Registration
Statement, the Prospectus or any documents incorporated therein by reference
containing an untrue statement of material fact or omitting to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading, such holder will forthwith discontinue disposition of
Registrable Securities until such holder's receipt of the copies of such
supplemented or amended Prospectus as corrects such misstatement or omission, or
until it is advised in writing by the Company that the use of the Prospectus may
be resumed, and has received copies of any additional or supplemental filings
which are incorporated by reference in the Prospectus, and, if so directed by
the Company, such holder will deliver to the Company (at the Company's expense)
all copies, other than permanent file copies then in such holder's possession,
of the Prospectus covering such Registrable Securities current at the time of
receipt of such notice. In the event the Company shall give any such notice, the
time periods during which such Registration Statement shall be maintained
effective shall be extended by the number of days during the period from and

including the date of the giving of such notice to and including the date when
each seller of Registrable Securities covered by such Registration Statement
either receives the copies of the supplemented or amended prospectus that
corrects such misstatement or omission or is advised in writing by the Company
that the use of the Prospectus may be resumed.

    7. Allocation of Expenses. The Company will indemnify and hold the
Purchaser harmless for the payment of all Registration Expenses of all
registrations under this Agreement, except as set forth in this
Agreement. The term Registration Expenses shall mean all expenses
incurred by the Company in complying with Section 3 or 4, including,
without limitation, all registration and filing fees, exchange listing
fees, printing expenses, fee; and disbursements of counsel for the
Company and the Purchaser, state Blue Sky fees and expenses (except
that: the Purchaser shall not cause or request the filing for Blue Sky
approval in any state reasonably refused by the Company), and the
expenses of any special audits incident to or required by any such
registration, but excluding underwriting discounts and selling
commissions.

     In connection with each Registration Statement required hereunder, the
Company will reimburse the holders of Registrable Securities being
registered pursuant to such Registration

                            -12-


<PAGE>

Statement for the reasonable fees and disbursements of not more than one
counsel chosen by the holders of a majority of such Registrable
Securities.

    Each seller of Registrable Securities shall pay all discounts, commissions,
fees and expenses of the underwriters, selling brokers, dealer managers, and
similar industry professionals relating to the distribution of its Registrable
Securities.

    8. Indemnification. In the event of any registration of any of the
Registrable Securities under the Securities Act pursuant to this Agreement, the
Company will indemnify and hold harmless the Purchaser, and each of its officers
and directors, and each other person, if any, who controls the Purchaser, within
the meaning of the Securities Act or the Exchange Act against any losses,
claims, damages or liabilities, joint or several, to which the Purchaser or
controlling person may become subject under the Securities Act, the Exchange
Act, state securities or Blue Sky laws or otherwise, insofar as such losses,
claims, damages, or liabilities (or actions in respect thereof) arise out of or
are based upon any untrue statement or alleged untrue statement of any material
fact contained in any Registration Statement under which such Registrable
Securities were registered under the Securities Act, any preliminary prospectus
or final prospectus contained in the Registration Statement, or any amendment or
supplement to such Registration Statement, or arise out of or are based upon the
omission or alleged omission to state a material fact required to be stated
therein or necessary to make the statements therein not misleading or arise out
of or are based upon any violation by the Company of the Securities Act in

connection with such registration; and the Company will reimburse the Purchaser,
officer, director, and each such controlling person for any legal or any other
expenses reasonably incurred by the Purchaser, officer, director, or controlling
person in connection with the investigating or defending of any such loss,
claim, damage, liability or action; provided, however, that the Company will not
be liable in any such case to the extent that any such loss, claim, damage or
liability arises out of or is based upon any untrue statement or omission made
in such Registration Statement, preliminary prospectus or prospectus, or any
such amendment or supplement, in reliance upon and in conformity with
information furnished to the Company, in writing, by or on behalf of the
Purchaser, officer, director, underwriter, or controlling person specifically
for use in the preparation thereof.

    In the event of any registration of any of the Registrable Securities
under the Securities Act pursuant to this Agreement, the Purchaser will
indemnify and hold harmless the Company, each of its directors and officers and
each underwriter (if any) and each person, if any, who controls the Company or
any such underwriter within the meaning of the Securities Act or the Exchange
Act, against any losses, claims, damages, or liabilities, joint or several, to
which the Company, such directors and officers, underwriter or controlling
person may become subject under the Securities Act, Exchange Act, state
securities or Blue Sky laws or otherwise, insofar as such losses, claims,
damages, or liabilities (or actions in respect thereof) arise out of or are
based upon any untrue statement or alleged untrue statement of a material fact
contained in any Registration Statement under which such Registrable Securities
were registered under the Securities Act, any preliminary prospectus or final
prospectus contained in the Registration Statement, or arise out of or are based
upon any omission or alleged omission to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, if
the statement or omission was made in reliance upon and in conformity with
information furnished in writing to the Company, by or on behalf of the
Purchaser, specifically for use in connection with the preparation of such
Registration Statement, prospectus, amendment, or supplement; provided, however,
that the obligations of the Purchaser hereunder shall be limited to an amount
equal to the proceeds of the Registrable Securities sold as contemplated herein;
provided, further, that, with respect to any untrue statement or omission or
alleged untrue statement or omission made in any preliminary prospectus, the
indemnity agreement contained in this Section 8 shall not apply to the extent
that any loss, claim, damage or liability results from the fact that a current
copy of the

                            -13-


<PAGE>

prospectus was not sent or given to the person asserting any such loss,
claim, damage, or liability at or prior to the written confirmation of
the sale of the Registrable Securities confirmed to such person if it is
determined that it was the responsibility of the Company, any of its
directors, officers or agents to provide such person with a current copy
of the prospectus and such current copy of the prospectus would have
cured the defect giving rise to such loss, claim, damage or liability.

    Each party entitled to indemnification under this Section 8 (the

"Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has actual knowledge of any claim as to which indemnity may be sought, and shall
permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom; provided, that counsel for the Indemnifying
Party, who shall conduct the defense of such claim or litigation, shall be
approved by the Indemnified Party (whose approval shall not be unreasonably
withheld); and, provided, further that the failure of any Indemnified Party to
give notice as provided herein shall not relieve the Indemnifying Party of its
obligations under this Section 8. The Indemnified Party may participate in such
defense at such party's expense provided, however, that the Indemnifying Party
shall pay such expense if representation of such Indemnified Party by the
counsel retained by the Indemnifying Party would be inappropriate due to actual
or potential differing interests between the Indemnified Party and any other
party represented by such counsel in such proceeding. No Indemnifying Party, in
the defense of any such claim or litigation, shall except with the consent of
each Indemnified Party, consent to entry of any judgment or enter into any
settlement which does not include as an unconditional term thereof the giving by
the claimant or plaintiff to such Indemnified Party of a release from all
liability in respect of such claim or litigation, and no Indemnified Party shall
consent to entry of any judgment or settle such claim or litigation without the
prior written consent of the Indemnifying Party.

    If the indemnification provided for in this Section 8 is held by a court of
competent jurisdiction to be unavailable to an Indemnified Party, then each
Indemnifying Party, in lieu of indemnifying such Indemnified Party thereunder,
hereby agrees to contribute to the amount paid or payable by such Indemnified
Party in such proportion as is appropriate to reflect the relative fault of the
Indemnifying Party on the one hand and of the Indemnified Party on the other.
Notwithstanding the foregoing, the amount the Purchaser shall be obliged to
contribute pursuant to this paragraph of Section 8 shall be limited to an amount
equal to the public offering sale price of the shares sold by the Purchaser.

    9. Information by Holder. The Purchaser shall furnish to the Company such
information regarding the Purchaser and the distribution proposed by the
Purchaser as the Company may request in writing and as shall be required in
connection with any registration, qualification or compliance referred to in
Section 3 or 4.

    No Person may participate in any Underwritten Registration hereunder unless
such Person (a) agrees to sell such Person's securities on the basis provided in
any underwriting arrangements approved by the Persons entitled hereunder to
approve such arrangements and (b) completes and executes all questionnaires,
powers of attorney, indemnities, underwriting agreements, and other documents
required under the terms of such underwriting arrangements.

    10.  Rule 144 Requirements.  The Company agrees to use reasonable efforts
to:

         (a) make and keep public information available, as those terms are
understood and defined in Rule 144 under the Securities Act;

                            -14-



<PAGE>


         (b) file with the Commission in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and

         (c) furnish to the Purchaser upon request a copy of the most recent
annual or quarterly report of the Company, and such other reports and documents
of the Company as the Purchaser may reasonably request to avail itself of any
similar rule or regulation of the Commission allowing it to sell all or any
portion of the Registrable Securities without registration.

    11.  Standstill Agreement.

    11.1 Except as hereinafter set forth in subsection 11.2, the Purchaser
agrees, for itself and its Affiliates, whether now or hereafter created or
acquired, and any of the Purchaser's pension plans or employee benefit plan
programs sponsored by the Purchaser for which the Purchaser controls its
investment decisions, that it will not, until the earlier of (x) the termination
of the Collaboration Agreement or (y) twenty (20) years from the date of this
Agreement, without the prior written consent of the Company;

         (i) directly or indirectly acquire or own beneficially and/or of
record more than twenty (20%) percent of the Then Outstanding Capital Stock of
the Company (as hereinafter defined). For purposes of this Section 11, the Then
Outstanding Capital Stock of the Company shall be deemed to be the total number
of shares of the Company's issued and outstanding Common Stock and all shares of
Common Stock (a) into which any issued and outstanding shares of preferred stock
and any other securities exchangeable or convertible into Common Stock are
exchangeable or convertible and (b) for which any issued, outstanding, and
exercisable options or warrants to acquire Common Stock are then exercisable, as
well as all capital stock issued as a result of any stock split, stock dividend,
or reclassifications of Common Stock distributable, on a pro rata basis, to all
holders of Common Stock or securities convertible into Common Stock;

         (ii) directly or indirectly, solicit proxies or consents or become a
participant in a solicitation (as such terms are defined in Regulation 14A under
the Exchange Act) in opposition to the recommendation of the majority of the
Board of Directors of the Company with respect to any matter, or seek to advise
or influence any person, with respect to the voting of any securities of the
Company or any of its subsidiaries;

         (iii) propose or induce any other person to propose, directly or
indirectly, (x) any merger or business combination involving the Company or any
of its subsidiaries, (y) the purchase or sale of any assets of the Company or
any of its subsidiaries or (z) the purchase of any of the voting securities of
the Company, by tender offer or otherwise (except pursuant to the exercise of
rights, warrants, options, or similar securities distributed by the Company to
holders of voting securities generally);

         (iv) deposit any voting securities in a voting trust or subject any
voting securities to any arrangement or agreement with respect to the voting of
voting securities; or


         (v)  advise, assist, or encourage any other person in connection with
any of the foregoing.

    11.2 The Purchaser will be relieved of the restrictions set forth in
subsection 11.1 of this Agreement only under the following circumstances and for
the specific transactions as set forth herein below:

                            -15-


<PAGE>



         (i) if a third party, not an Affiliate of the Purchaser, directly
or indirectly makes a bona fide tender offer or other bona fide offer for more
than twenty (20%) percent but not more than fifty (50%) percent of the Company's
Then Outstanding Capital Stock, and said third party has, in the reasonable
opinion of the Purchaser, the financial resources, ability and intention to
carry out such offer, the Purchaser shall not be prohibited from purchasing or
conducting a tender offer for an amount of shares equal to the amount of shares
sought out be acquired by the third party during the period of its tender offer;

         (ii) if a third party, not an Affiliate of the Purchaser, directly or
indirectly makes a bona fide tender offer or other bona fide offer for more than
fifty (50%) percent of the Company's Then Outstanding Capital Stock and said
third party has, in the reasonable opinion of the Purchaser, the financial
resources, ability and intention to carry out such offer, the Purchaser shall
not be prohibited from purchasing or conducting a tender offer for all or less
than all of the Then Outstanding Capital Stock it does not already own during
the period of the third party's tender offer; or

         (iii) in the event the Company hereafter issues to a third party more
than seven (7%) percent of its Then Outstanding Capital Stock pursuant
to a negotiated written transaction without requiring such third party
to enter into a standstill agreement with provisions substantially as
restrictive as those set forth in this Section 11, then Purchaser shall
be relieved from its obligations hereunder.

    11.3 At the time that the Board of Directors of the Company makes a
decision to put the Company up for sale and to entertain bids in connection with
such sale, the Company shall promptly notify the Purchaser of such decision and
in the event that the Company is entertaining a merger proposal or acquisition
proposal which would result in the Company being merged with and into or
acquired by another corporation and such negotiations have reached a state of
finality that the Company believes a public announcement is warranted, the
Company shall forthwith notify the Purchaser of the material terms of such
proposed merger or acquisition which have been agreed upon. Purchaser's rights
under this subsection shall be limited solely to notification. The Company's
obligations under this Section 11 including without limitation this subsection
11.3 shall terminate upon the termination of the Collaboration Agreement.

    11.4 The parties hereto acknowledge and agree that the Company would be
irreparably damaged in the event that any of the provisions of this Section 11

are not performed in accordance with their specific terms or are otherwise
breached and that monetary damages are not an adequate remedy for said breach.
It is, accordingly, agreed that the Company shall be entitled to injunctive
relief to prevent breaches of this Section 11 by Purchaser and/or its
Affiliates, and to specifically enforce this Section 11 and the terms and
provisions thereof, in addition to any other remedy to which such aggrieved
party may be entitled, at law or in equity. The Company may enter a stop
transfer order with respect to the transfer of voting securities except in
compliance with the termination of this Agreement.

    11.5 The Company shall give Purchaser prompt notice of the receipt by the
Company of any Schedule 13-D filing from any person or Group (within the meaning
of the Exchange Act) couched in such terms as to put the Company reasonably on
notice of the likelihood that such person or Group has acquired or is proposing
to acquire any shares of Common Stock which results in, or, if successful, would
result in, such person or Group owning or having the right to acquire more than
twenty percent (20%) of the Company's Then Outstanding Capital Stock.

    11.6 If Purchaser desires at some date to account for its investment
in the Company pursuant to the equity method, the Company shall promptly furnish
the Purchaser, at Purchaser's sole expense, which estimated expense shall be
prepaid by Purchaser if so requested

                            -16-


<PAGE>

by the Company, all information that is required by generally accepted
accounting principles to enable Purchaser to so account. To the extent
reasonably available to the Company and to the extent reasonably
requested by Purchaser, the Company shall provide information (and shall
cause its employees, independent public accountants, and other
representatives to do the same), to the extent reasonably available
regarding the Company's to, and otherwise cooperate with, Purchaser so
as to enable Purchaser to prepare financial statements in accordance
with accounting principles generally accepted in the United States and
to comply with its reporting requirements and other disclosure
obligations under applicable United States securities laws and
regulations (the "Regulations"). Purchaser agrees to hold all such
information in at least the same degree of confidence as it would hold
similar information regarding its operations and condition, and to
disclose it only to the extent required by the Regulations, provided
that there shall be no restriction on Purchaser's right to disclose its
own financial statements, whether or not reflecting or including such
information.

    11.7 All purchases of securities of the Company by Purchaser shall be
made in compliance with applicable laws and regulations.

    11.8 During the term of the Collaboration Agreement, Purchaser agrees,
for itself and its Affiliates, whether now or hereafter created or
acquired, and any of the Purchaser's pension plans or employee benefit
plan programs sponsored by the Purchaser for which the Purchaser
controls its investment decisions, that it will not, directly or

indirectly, by action or inaction, use its voting power (by itself or in
concert with others) to cause any Key Man of the Company (as that term
is used in the Collaboration Agreement) to leave the Company, including,
without limitation, voting against the election or reelection of any Key
Man to serve as a member of the Board of Directors of the Company.

    12.  Amendments and Waivers.  This Agreement may be amended, modified,
supplemented or waived only with the written consent of the parties hereto.

    13. Notices. Except as otherwise provided in this Agreement, all notices,
requests and other communications to any Person provided for hereunder shall be
in writing and shall be given to (a) in the case of the Company, at 777 Old Saw
Mill River Road, Tarrytown, New York 10591, attention: President, with a copy to
the attention of General Counsel and Corporate Secretary or (b) in the case of
the Purchaser, at One Procter & Gamble Plaza, Cincinnati, Ohio 45202, attention:
President, with a copy to the attention of General Counsel. Each such notice,
request or other communication shall be effective (i) if given by mail, 72 hours
after such communication is deposited in the mails with first class postage
prepaid, addressed as aforesaid or (ii) if given by any other means (including,
without limitation, by air courier), when delivered at the address specified
above.

    14. Successors and Assigns. The provisions of this Agreement, including the
rights and obligations hereunder, shall be binding upon, and inure to the
benefit of, the respective successors and assigns of the Purchaser (the
Transferees) and of the Company, provided that such Transferees shall be an
Affiliate of the Purchaser, and such Transferees shall become the Purchaser for
the all purposes of this Agreement.

    15.  Transfer of Certain Rights.

    15.1 The rights and obligations of the Purchaser under this Agreement may
be transferred by the Purchaser to any Affiliate of the Purchaser. The Company
shall be given written

                            -17-


<PAGE>

notice by the Purchaser at the time of such transfer stating the name
and address of the Transferee and identifying the securities with
respect to which such rights are assigned.

    15.2 Any Transferee to whom rights are transferred shall, as a
condition to such transfer, deliver to the Company a written instrument pursuant
to which the Transferee agrees to be bound by the obligations imposed upon the
Purchaser hereunder to the same extent as if such Transferee were the Purchaser
hereunder.

    16.  Descriptive Headings.  The descriptive headings of the several sections
and paragraphs of this Agreement are inserted for reference only and shall not
limit or otherwise affect the meaning hereof.

    17.  Governing Law.  THIS AGREEMENT SHALL BE CONSTRUED AND

ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS OF THE PARTIES SHALL BE
GOVERNED BY, THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO
THE PRINCIPLES OF CONFLICTS OF LAWS.

    18.  Counterparts.  This Agreement may be executed simultaneously in any
number of counterparts, each of which shall be deemed an original, but all such
counterparts shall together constitute one and the same instrument.

    19.  Entire Agreement.  This Agreement embodies the entire agreement and
understanding between the Company and the Purchaser relating to the subject
matter hereof and supersedes all prior agreements and understandings relating to
such subject matter.

    20. Severability. If any provision of this Agreement, or the application of
such provisions to any Person or circumstance, shall be held invalid, the
remainder of this Agreement, or the application of such provision to Persons or
circumstances other than those to which it is held invalid, shall not be
affected thereby.

[Signature Page To Follow]

                                     -18-


<PAGE>


     IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
and delivered by their respective officers thereunto duly authorized as of the
date first above written.

                 REGENERON PHARMACEUTICALS, INC.

                By__________________________________


                 THE PROCTER & GAMBLE COMPANY

                 By__________________________________




                                     -19-







<PAGE>

                                EXHIBIT  10.4
                                -------------

                     MULTI-PROJECT COLLABORATION AGREEMENT

                                   between

                         THE PROCTER & GAMBLE COMPANY

                                     and

                        REGENERON PHARMACEUTICALS, INC.

                                May 13, 1997

Execution Copy



<PAGE>

                    MULTI-PROJECT COLLABORATION AGREEMENT

I.      Definitions
II.     Scope;  Management Committee
III.    Research and Development
IV.     Marketing of Products
V.      License Grants
VI.     Royalties and Accounting
VII.    Patents and Infringement
VIII.   Confidentiality
IX.     Representations, Warranties and Indemnification
X.      Term, Termination, Change of Control
XI.     Miscellaneous
XII.    Execution



<PAGE>

MULTI-PROJECT COLLABORATION AGREEMENT

Made as of this 13th day of May, 1997, by and among:

     The Procter & Gamble Company, an Ohio corporation having its principal
offices at One Procter & Gamble Plaza, Cincinnati, Ohio 45202 (hereinafter,
together with its Affiliate Procter & Gamble Pharmaceuticals, Inc., "Procter &
Gamble"), and

     Regeneron Pharmaceuticals, Inc., a New York corporation having its
principal office at 777 Old Saw Mill River Road, Tarrytown, New York 10591-6707
(hereinafter, together with its Affiliates, "Regeneron").

The following sets forth the background for this Agreement:

     Procter & Gamble conducts research and develops and markets pharmaceutical
     products for the treatment
 of a variety of disorders, including without
     limitation products having utility in the treatment of bone disorders,
     skeletal muscle disorders, cardiac muscle disorders, and antiinfectives.

     Regeneron conducts research for the development and commercialization of
     pharmaceutical products, based on significant expertise in identifying and
     developing molecular receptor targets and compounds that mediate a variety
     of disorders. Regeneron has entered into collaborative agreements with
     third parties for the research, development and commercialization of
     products regarding several such targets identified by Regeneron. Regeneron
     is independently pursuing research on other such targets.

     Regeneron and Procter & Gamble entered into an agreement on the 11th day of
     December 1996, establishing a collaborative effort to perform research and
     develop and market products for the prevention, diagnosis, and treatment of
     skeletal muscle disorders.

     Procter & Gamble and Regeneron share a common vision for further
     collaboration, and want to pursue additional research, development and
     marketing of products based on other targets and/or compounds identified by
     Regeneron.

                                       2


<PAGE>

     Procter & Gamble and Regeneron intend fully to utilize their capabilities,
     capitalize on each other's expertise, and put forth commercially reasonable
     efforts to achieve this objective, and recognize that each party is
     contributing valuable technologies and capabilities to this effort and that
     the combination of these compatible and complementary technologies and
     capabilities creates the basis for a successful collaboration.

     Procter & Gamble and Regeneron have also entered into a Securities Purchase
     Agreement, Registration Rights Agreement and Warrant Agreement as of the
     date first written above as part of this collaboration.


Accordingly, the Parties agree to the following terms and conditions:

                                       3


<PAGE>

                           Article I - Definitions
                           -----------------------

     1.1. "Affiliate" means any entity that directly or indirectly Owns, is
Owned by, or is under common Ownership with a Party to this Agreement. In no
event will Amgen-Regeneron Partners, any legal entity that Regeneron forms with
Glaxo that relates to their July 1993 agreement, any legal entity that Regeneron
forms with Pharmacopeia, Inc. that relates to their October 1996 agreement, or
any legal entity that Regeneron forms with Procter & Gamble that relates to this
Agreement be deemed to be an Affiliate of Regeneron under this Agreement. "Owns"
or "Ownership" means direct or indirect possession of more than fifty percent
(50%) of the votes of holders of a corporation's voting securities or a
comparable equity interest in any other type of entity.

     1.2. "Agreement" means the present agreement together with all attachments.

     1.3. "Allowable Research Expense" means Direct Costs incurred by either
Party after June 30, 2002  pursuant to an approved Research Collaboration Plan. 
Allowable Research Expenses will be recognized in accordance with GAAP.

     1.4. "Allowable Product Expense" means Direct Costs incurred by either
Party pursuant to an approved Product  Plan.  Allowable Product Expenses will be
recognized in accordance with GAAP.

     1.5. "Article" means any article of this Agreement.

     1.6. "Commercially Reasonable Efforts" means efforts and resources commonly
used in the research-based pharmaceutical industry for a compound or product at
a similar stage of research, development or commercialization, and having
similar market potential. Commercially Reasonable Efforts shall be determined
taking into account the stage of research, development or commercialization of
the compound or product, the cost-effectiveness of efforts or resources while
optimizing profitability, the competitiveness of alternative products that are
or expected to be in the relevant marketplace, the proprietary position of the
product, the regulatory and business environment, the likelihood of regulatory
approval and product reimbursement, the profitability of the product, the
existence of alternative products that may also be developed by the Parties, and
all other relevant factors. Commercially Reasonable Efforts shall be determined
on a compound-by-compound and market-by-market basis, and it is anticipated that
the level of 

                                       4


<PAGE>

effort will change over time reflecting changes in the status of the compound,
product and the market involved.


     1.7. "Competing Product" means any compound, product, method or system that
is indicated for the same disease state and has the same mechanism of action as
a Development Compound or Marketed Compound.  Competing Product shall not
include Excluded Technology.

     1.8. "Compound" means a chemical entity, which is not Excluded Technology, 
with research or commercial utility for methods of research, diagnosis,
treatment or prevention of any disease or disorder in humans or animals, and
which

          (a) is conceived and/or reduced to practice by Regeneron, or acquired
     by Regeneron from a Third Party with the right to sublicense, before or
     during the Research Term; or

          (b) is conceived and/or reduced to practice by Procter & Gamble, or
     acquired by Procter & Gamble from a Third Party with the right to
     sublicense, as a direct result from research on a Target during the
     Research Term; or

          (c) was conceived and/or reduced to practice by Procter & Gamble in
     the Muscle Field prior to or during the Term.

     Compound includes Research Compounds, Development Compounds and Marketed
Compounds that may be useful in methods of research, diagnosis, treatment or
prevention of any disease or disorder in humans or animals. Each Compound shall
also be deemed to include all indications, formulations, line extensions, or
modes of administration thereof.

     1.9. "Development Compound" means a Compound designated by the Operations
Committee for further development pursuant to Section 3.3(b).

     1.10. "Direct Costs" means costs, of a nature, amount, and method of
calculation approved by the Operations Committee via the Research Collaboration
Plan and/or Product Plan, that are incurred by either Party , based upon
efforts, funds and/or resources expended to perform its obligations under such
plan. Direct Costs may include costs associated with activities performed by a
Party, or by a Third Party under an appropriate agreement pursuant to Section
2.6, for the research, development or marketing of Compounds. Direct Costs shall
not include any mark-up or profit above actual costs.

     1.11. "Effective Date" means the date described in Section 10.1(a).

                                       5


<PAGE>

     1.12. "Excluded Research  Project" means  a Regeneron research project that
has been excluded from the collaboration of the Parties under this Agreement
pursuant to Section 2.10 or Section 3.2(c).

     1.13. "Excluded Technology" means any invention, trade secret or other
information, whether tangible or intangible, whether or not patentable, that is:


          (a) conceived or reduced to practice by Regeneron, or acquired from a
     Third Party by Regeneron before or during the Term insofar as such
     invention, trade secret or other information (i) is part of the subject
     matter listed in Attachment 1.13, or (ii) directly relates to an Excluded
     Research Project ("Regeneron Excluded Technology"); or

          (b) conceived or reduced to practice by Procter & Gamble or acquired
     by Procter & Gamble from a Third Party before or during the Term insofar as
     such invention, trade secret and other information is not Procter & Gamble
     Technology. Notwithstanding the foregoing, Excluded Technology shall not
     include any compound, product, method or system which is in human clinical
     development or Marketed and is acquired by Procter & Gamble from a Third
     Party which, at the time of acquisition is indicated for the same disease
     state and is known to have the same mechanism of action as a Development
     Compound or Marketed Compound.

     1.14. "Fiscal Quarter" means each period of three (3) months ending on 31
March or 30 June or 30 September or 31 December.

     1.15. "Fiscal Year" means the twelve (12) month period of time from July 1
to June 30, except that the first Fiscal Year commences on the Effective Date
and ends on June 30, 1998 and the last Fiscal Year during the Research Term
shall end on the anniversary of the Effective Date in the Fiscal Year in which
the Research Term expires or is terminated pursuant to Sections 10.1 and 10.2.

     1.16. "FTE" or "Full Time Equivalent" means one Effort Year of an employee
or class of employees. "Effort Year" means nineteen hundred and fifty (1,950)
hours of direct effort expended on approved activities during a Fiscal Year.

     1.17. "GAAP" means generally accepted accounting principles.

                                       6


<PAGE>     

     1.18. "J-V" means such collaborative relationship as may be established
pursuant to Section 3.7 of this Agreement. J-V may or may not be structured as a
separate legal entity, such as a corporation, partnership, LLC, or such other
form as the Parties may agree. In agreeing on the form of the collaborative
relationship, the Parties shall take appropriate account of, among other
factors, ease of administration and tax liabilities.

     1.19. "Know-how" means the entire right, title and interest in trade secret
technology. "P&G Know-how" shall mean the entire right, title and interest in
Know-how owned solely or jointly by Procter & Gamble with a Third Party or with
Regeneron pursuant to Section 5.1. "Regeneron Know-how" shall mean the entire
right, title and interest in Know-how owned solely or jointly by Regeneron with
a Third Party or with Procter & Gamble pursuant to Section 5.1.

     1.20. "Lead Compound" means a Research Compound that has been demonstrated
to meet Success Criteria, whether or not the Research Compound has been
designated a Development Compound pursuant to Section 3.3(b).

     1.21. "Major Country" means the **********.


     1.22. "Major Decision" means the following decisions to be made by the
Operations Committee:

          (a) Approval of all long-range strategic plans developed pursuant to
     this Agreement, including without limitation the Research Collaboration
     Plan and the Product Plan;

          (b) Disposition of any interest in any type of intellectual property
     in which the Parties have rights under this Agreement(other than routine
     copyright transfers incident to publications made pursuant to Section 8.3),
     including without limitation any license, assignment, or registration of
     any Patent, trademark or Know-how;

          (c) Determination of whether a Research Compound has met the Success
     Criteria for further development;

          (d) Expenditure of any funds, or incurrence of any obligation, in
     excess of ********* for the acquisition of a particular piece of property
     (including without limitation real or intellectual property), equipment or
     service regarding work under this Agreement, unless such expenditure or
     obligation is explicitly authorized in a Research Project Plan or a Product
     approved by the Operations Committee;

          (e) Expenditure of any funds, or incurrence of any obligation,
     regarding  any budget item that cannot be resolved by Program Committee;

                                       7


<PAGE>

          (f) Initiation or settlement of any lawsuits by or against the Parties
     (except against each other) in connection with this Agreement, subject to
     Section 9.3;

          (g) Acceptance of contracts outside the ordinary course of business of
     the collaboration as described in Section 2.1 and any contracts with either
     Party or its Affiliates or any contracts pertaining to the collaboration in
     which a Party has a beneficial interest;

          (h) Selection of any trademark regarding a Development Compound or
     Marketed Compound; and

          (i)  Initiation of any recalls of Marketed Compounds.

     1.23. "Marketed Compound" means a Compound which is sold pursuant to this
Agreement in any country in the Territory.

     1.24. "Muscle Field" means the diagnosis, prevention and/or treatment of
conditions in humans and animals associated with the promotion or protection of
skeletal muscle mass or function (including, without limitation, the diagnosis,
treatment or prevention of muscle atrophy), as set forth in the Collaboration
Agreement between the Parties dated the 11th day of December, 1996.


     1.25. "Net Sales" means total gross realization less: (i) discounts,
including cash discounts and discounts for special purchases, rebates,
retroactive price reductions or allowances granted or incurred from the billed
amount, (ii) any sales or value added taxes or any other taxes measured by the
amount of sales or gross receipts, and (iii) credits or allowances actually
granted upon claims, rejections or returns, including recalls, regardless of the
party requesting such. As used herein, total gross realization means the list
price for a product containing a Compound multiplied by the volume in units for
units sold or otherwise transferred by either Party or an authorized agent of
either Party to a customer, but excludes sales or transfers between and among
the Parties, the Parties' Affiliates, or an authorized agent or licensee of
either Party, unless such sale or other transfer is to a customer.

     1.26. "Operations Committee" or "OC" means the committee described in 
Article II.

     1.27. "Opting Out Party" means the Party that Opts Out of those research,
development and/or marketing activities with respect to a Compound as specified
in Sections 2.10, 3.2(b), 3.2(c), 3.4(b), 3.6, and 10.3(b). "Opts Out" means
that the Opting Out Party either decides not to

                                       8


<PAGE>

continue with such activities or does not fund its share of Allowable Research
Expenses and/or Allowable Product Expenses with respect to such activities.

     1.28. "Party" means Regeneron or Procter & Gamble.

     1.29. "Patent" means the entire right, title and interest in a Valid Claim
in a patent application, and all continuing and divisional patent applications,
continuations-in-part, reissue applications and all other related patent
applications claiming priority, indirectly and directly, to such application,
and all patents issuing therefrom, worldwide. "P&G Patent Rights" shall mean the
entire right, title and interest in a Patent owned solely by Procter & Gamble or
jointly by Procter & Gamble with a Third Party or with Regeneron pursuant to
Section 5.1. "Regeneron Patent Rights" shall mean the entire right, title and
interest in a Patent owned solely by Regeneron or jointly by Regeneron with a
Third Party or with Procter & Gamble pursuant to Section 5.1.

     1.30. "Proceeding Party" means the Party that is not an Opting Out Party
with respect to a Research Project, or the development or marketing of a
Compound either in the entire Territory or in one or more specific countries
therein.

     1.31. "Procter & Gamble Technology" means any invention, Know-how or other
information, other than Compounds which have not met Success Criteria, whether
tangible or intangible, whether or not patentable, which has actual or potential
utility for the identification, research or commercialization of products for
the prevention, diagnosis, or treatment of diseases or disorders in humans or
animals, and which:

          (a) has utility in ***** and which, prior to or during the Research

     Term, is conceived or reduced to practice by Procter & Gamble or acquired
     or licensed by Procter & Gamble from a Third Party with the right to
     sublicense; or

          (b) does not have utility in ***** and which, during the Research
     Term, is conceived or reduced to practice by Procter & Gamble or acquired
     or licensed by Procter & Gamble from a Third Party with the right to
     sublicense, as a direct result of research on a Target; or

          (c) other than (a) and (b), insofar as is necessary for performing
     research pursuant to a Research Collaboration Plan using a Procter & Gamble
     Target as defined in 1.44(b) and which, prior to or during the Research
     Term, is conceived or reduced to practice by Procter & Gamble or acquired
     or licensed by Procter & Gamble from a Third Party with the right to
     sublicense; or

                                       9


<PAGE>

          (d) during the Term, but after the Research Term, is conceived or
     reduced to practice by Procter & Gamble or licensed by Procter & Gamble
     from a Third Party with the right to sublicense, regarding a Development
     Compound or Marketed Compound.

     Procter & Gamble Technology may include, without limitation, research
methods and materials (including without limitation genetic materials,
receptors, cell lines and transgenic animals) useful in performing research,
Lead Compounds, formulations, chemical synthesis and manufacturing processes,
methods of diagnosis and methods of treatment.

     1.32. "Product Plan" means the annual compilation of objectives,
activities, resource allocations, Success Criteria, Allowable Product Expenses
and budgets regarding the development and/or marketing of Development Compounds
and/or Marketed Compounds agreed to by the OC, as more thoroughly described in
Section 3.3(b).

     1.33. "Program Committee" or "PC" means the committee established pursuant
to Section 2.2(b).
          
     1.34. "Regeneron Technology" means any invention, Know-how or other
information, whether tangible or intangible, whether or not patentable, which:

          (a) is not Regeneron  Excluded Technology, and

          (b) is conceived or reduced to practice by Regeneron or acquired or
     licensed by Regeneron from a Third Party with the right to sublicense,

                (i)  before or during the Research Term; or
                (ii) after the Research Term, but during the Term, regarding a
                Development Compound or Marketed Compound.

     Regeneron Technology may include, without limitation, research methods and
materials (including without limitation genetic materials, receptors, cell lines

and transgenic animals) useful in performing research, Targets, Compounds,
formulations, chemical synthesis and manufacturing processes, methods of
diagnosis and methods of treatment.

     1.35. "Research Collaboration Plan" means, on a Fiscal Year basis, the
compilation of objectives, prioritization of Research Projects and work on new
areas of research, Success Criteria and overall budget for work by the Parties
during the Research Term, but not including development and/or marketing
activities. After June 30, 2002, the Research Collaboration Plan shall also
include Allowable Research Expenses.

                                      10


<PAGE>

     1.36. "Research Compound" means a Compound that has not yet been designated
a Development Compound.

     1.37. "Research Project" shall mean research conducted by the Parties for
the purpose of identifying, optimizing, and testing a specific Target, Validated
Target and/or Research Compound.

     1.38. "Research Project Plan" shall mean, on a Fiscal Year basis, the
compilation of activities, milestones, budget, and Success Criteria relating to
a Research Project.

     1.39. "Research Term" means the period of time beginning on the Effective
Date and unless terminated earlier pursuant to Section 10.2 or 10.3(b), ending
ten (10) years after the Effective Date.

     1.40. "Royalty Term" means the period from the first Net Sales in the first
country to the final payment of royalties in the last country pursuant to
Section 6.1.

     1.41. "Section" means any section of this Agreement.

     1.42. "Success Criteria" means the specific criteria set forth in a
Research Project Plan and Research Collaboration Plan and approved by the OC
that define the minimum technical and commercial requirements for a Research
Compound to be designated a Development Compound.

     1.43. "Sumitomo Compound" means any Compound which:
           (a) is claimed by a Regeneron Patent; 
           (b) is owned by Regeneron prior to the Effective Date, or conceived 
     and solely reduced to practice solely by Regeneron during the Research
     Term; and 
           (c) Sumitomo Chemical Company Limited or its affiliates exercise
     rights pursuant to its Technology Development Agreement with Regeneron
     executed in March 1989 (hereinafter the "Sumitomo Agreement).

     1.44. "Target" means:
           (a) any gene, receptor, ligand, or other compound which is Regeneron
     Technology, which has actual or potential utility for the identification,
     research or 


                                      11


<PAGE>

commercialization of compounds for the prevention, diagnosis, or treatment of
diseases or other disorders in humans or animals; or

          (b) any gene, receptor, ligand, or other compound which Procter &
Gamble designates as subject to research under this Agreement and Regeneron
agrees to include in a Research Project pursuant to Section 2.1(c) (a "Procter &
Gamble Target").

     1.45. "Term" means the period of time specified in Section 10.1(b).

     1.46. "Territory" means the entire world, excluding Japan with respect to
any Sumitomo Compound and MuSK and Agrin.  Japan shall be included in the
Territory except for Sumitomo Compounds and MuSK and Agrin.  "MuSK" shall mean
the materials **********. "Agrin" shall mean the compounds ***********.

     1.47. "Third Party" means any entity other than Regeneron or Procter &
Gamble or their Affiliates or a J-V established in accordance with this
Agreement.

     1.48. "Valid Claim" shall mean any claim in a published and unexpired
application or patent included within a Patent which claim has not been held
unenforceable, unpatentable or invalid by a decision of a court or other
governmental agency of competent jurisdiction, unappealable or unappealed within
the time allowed for appeal, and which has not been finally abandoned or
admitted to be invalid or unenforceable through disclaimer.

     1.49. "Validated Target" means a Target which has been shown to meet all of
the following criteria approved by the PC:
          (a) the Target is *******.
          (b) agents, ligands, or intracellular molecules that *******; and 
          (c) the Target is shown to ******.


            Article II - Overview and Management of Collaboration
            -----------------------------------------------------

     2.1. Scope of Collaboration.

          (a) The Parties will work together to research, develop and
commercialize Lead Compounds pursuant to this Agreement in the Territory. All
such work shall be conducted pursuant to a Research Collaboration Plan and
Product Plans established by the OC pursuant to Article III. The Parties shall
use Commercially Reasonable Efforts in performing their obligations under this
Agreement.

                                      12


<PAGE>


          (b) Work under this Agreement will include work in the Muscle Field,
     in addition to other areas of mutual interest. Accordingly, the
     Collaboration Agreement dated 11 December 1996 is hereby terminated on the
     Effective Date and superseded by the terms of this Agreement.

          (c) At Procter & Gamble's sole discretion, Procter & Gamble may
     designate genes, receptors, ligands or compounds owned by Procter & Gamble
     as a subject of a Research Project. Subject to Regeneron's agreement to
     include them as a Research Project, such genes, receptors, ligands or
     compounds will be deemed Procter & Gamble Targets. Gene, receptors, ligands
     or compounds contributed by Procter & Gamble pursuant to the Collaboration
     Agreement specified in Section 2.1(b) shall be deemed Procter & Gamble
     Targets.

          (d) Subject to the provisions of a Research Project Plan or Research
     Collaboration Plan, the primary responsibilities for the activities shall
     be as follows:

     * Regeneron will identify and characterize Targets and Validated Targets.
Characterization of Procter & Gamble Targets will be the joint responsibility of
the Parties.

     * Regeneron will provide Target materials for high throughput screening
(HTS) and will develop low throughput assays. The responsibility for such
activities for Procter & Gamble Targets will be shared.

     * Procter & Gamble will develop HTS and combinatorial libraries and conduct
HTS to identify Research Compounds in the collaboration.

     * Procter & Gamble will optimize Research Compounds to meet the Success
Criteria. Regeneron will characterize and scale-up peptide and protein Research
Compounds.

     * Regeneron will develop and conduct models and assays necessary to assess
Research Compounds against Target success criteria. Procter & Gamble and
Regeneron will share responsibility for developing and using models and assays
to meet success criteria for Procter & Gamble Targets and Targets in the Muscle
Field.

          (e) The Parties will also work together to develop and market
     Development Compounds and Marketed Compounds in the Territory in accordance
     with Product Plans.

2.2. Committee Membership.

     (a) OC Membership. The work under this Agreement, as set forth in Section
     2.1, shall be performed by the Parties pursuant to the oversight of the OC.
     The OC has overall responsibility for the collaboration. The OC may
     delegate its responsibilities to

                                      13


<PAGE>


     other committees (e.g., to a Program Committee as established pursuant to
     Section 2.2(b), or to a Patent Committee, Research Committee, Finance
     Committee, Clinical Committee or such other committees as the OC may
     establish); however, the OC may not delegate Major Decisions. The OC will
     initially consist of two (2) members with one (1) member designated by each
     Party. The initial members are listed on Attachment 2.2(a). A chairperson
     of the OC will be nominated alternately by Procter & Gamble and Regeneron
     to twelve (12) month terms. The Parties will be free to change their
     respective representatives, on notice to the other Party. The OC will exist
     until the earlier of termination or expiration of this Agreement or when
     one Party is an Opting Out Party with respect to all Compounds in all
     countries, unless the Parties otherwise agree. The first OC meeting shall
     occur within Sixty (60) days of the Effective Date.

     (b) PC Membership. A Program Committee is also hereby established and shall
     work pursuant to the oversight of the OC. The PC shall develop and propose
     the Research Collaboration Plan, as well as a plan for any other Major
     Decisions, for the OC's review and approval. Upon the OC's approval of such
     Research Collaboration Plan or Major Decision, the PC is responsible for
     managing such matters and reporting to the OC on a regular basis. The PC
     shall also develop and propose the Research Project Plans. The membership
     of the PC shall consist of six (6) members, with three (3) members
     designated by each Party. The method for the nomination of the chairperson
     of the PC shall be the same as that for the OC as described in Section
     2.2(a). The initial members of the PC are listed on Attachment 2.2(b). The
     first PC meeting shall occur within thirty (30) days of the Effective Date.

     2.3. Meetings. The OC will meet at least one (1) time per Fiscal Year and
the PC will meet at least four (4) times per Fiscal Year, and either or both
committees may meet at additional times as the Parties shall agree. Either Party
may call a special meeting of the OC up to two (2) times per Fiscal Year, on
fifteen (15) days' written notice to the other Party. Additionally, the OC shall
meet within twenty (20) business days of the PC's request to approve any Major
Decisions. The chairperson shall send to all OC or PC members (as the case may
be) notices of all regular meetings and agendas for such meetings. The Party
convening a special meeting shall send notices and agenda for such meeting.
Meetings will alternate between the offices of the Parties, or may be held via
teleconference, videoconference or such other place or manner as the Parties may
mutually agree. Members of the OC and PC shall be empowered to make decisions
within the scope of their respective committee responsibilities and shall have
the right to participate in and vote at meetings in person, by telephone, by
videoconference or by proxy. The Party hosting any meeting shall appoint a
secretary to the meeting who will record the minutes of

                                      14


<PAGE>

the meeting which will be circulated to the members of the OC or PC (as the case
may be) promptly following the meeting for review, comment, and adoption.

     2.4. Decision-making Criteria. All decisions of the OC and PC shall be made
by majority vote and in the exercise of good faith. Such decisions shall adhere
to the ethical and legal standards for the research-based pharmaceutical

industry and utilize Commercially Reasonable Efforts to research, develop, and
commercialize Compounds. Notwithstanding the foregoing regarding a majority
vote, Procter & Gamble shall have the tie-breaking vote in the OC and PC with
respect to: (i) any strategic and/or funding/budgeting issues with respect to
the Research Collaboration Plan where Procter & Gamble determines in good faith
that there is the likelihood that Targets proposed by Regeneron may become
Excluded Technology as defined in Section 1.13, (ii) any Third Party costs in
Fiscal Years 1 through 5 which are the responsibility of Procter & Gamble
pursuant to Section 3.2 and (iii) decisions made pursuant to Section 4.1 and
5.4. Regeneron shall have the tie-breaking vote in the OC and PC with respect to
allocating Regeneron research FTEs within the scope of an approved Research
Collaboration Plan.

     2.5. Dispute Resolution. Subject to Section 2.4, if a decision cannot be
achieved by the PC, the matter shall be referred to further review and
resolution by the OC. If the OC cannot resolve the matter within thirty (30)
days, the OC shall refer the matter to the Chairman or CEO of Regeneron and the
Group Vice President - Health Care of Procter & Gamble (the "CEOs"), if both
CEOs were not voting members of the OC. If the CEOs (or the OC, if the CEOs are
both voting members) cannot resolve the issue within thirty (30) days, the CEOs
shall mutually agree upon and appoint to the OC a "Temporary Member." "Temporary
Member" means a person who is knowledgeable in the research based pharmaceutical
industry, possessing senior executive experience and skills and not associated
with either Party or a competitor of either Party. If the CEOs cannot mutually
agree on the identity of such Temporary Member within fifteen (15) days of the
end of such thirty (30) day period, the Parties shall request an arbitral panel
composed in accordance with Section 11.4, sitting in Boston, Mass., to, and such
panel shall, appoint to the OC a Temporary Member. The OC shall meet and resolve
the dispute within one week of such appointment of the Temporary Member. All
decisions with respect to the issue in dispute shall be made by majority vote of
the OC. Such Temporary Member shall be appointed to the OC until such time as
the CEOs mutually agree that the dispute or disputes have been resolved or until
one Party is deemed to be an Opting Out Party with respect to such Compound (and
country, if applicable) at issue, whichever is earlier. Such Temporary Member
shall be instructed to render his or her votes consistent with the stated
decision-making criteria of the OC,

                                      15


<PAGE>

as set forth in Section 2.4. The Parties shall share equally in all costs
associated with the appointment of the Temporary Member. Notwithstanding the
foregoing, any disputes, with respect to approving (or not approving) a Research
Collaboration Plan or negotiating a J-V Agreement shall be resolved by the
Temporary Member voting for one Party's proposed Research Collaboration Plan or
J-V Agreement, as the case may be.

     2.6. Conduct of Work by Others. It is understood that each Party has
entered into this Agreement based on the specific experience and skill of the
other Party. Accordingly, it is anticipated that work under this Agreement will
be conducted primarily by the Parties. However, it may be commercially
reasonable for the Parties to enter into agreements with commercial or
non-commercial Third Parties to acquire technology or conduct certain aspects of

such work (e.g., because the Third Party's work provides a favorable
cost/benefit vs. utilizing internal resources). Such agreements may include
(without limitation), acquisition of research methods, Compounds or intellectual
property rights (if applicable), consultation, conduct of certain research
tests, chemical synthesis and supply, safety testing, clinical testing, and
marketing support. All such work by or acquisition from Third Parties shall be
conducted pursuant to the Research Collaboration Plan and/or Product Plan and
shall be performed pursuant to written agreements embodying confidentiality,
intellectual property rights and other terms consistent with the terms set forth
in this Agreement. To the extent commercially reasonable, the commercial or
non-commercial Third Parties will be obligated to assign or exclusively license
any patents, patent applications or know-how under terms that are mutually
agreeable to the Parties. Information obtained by a Party from any Third Party
shall be subject to Article VIII of this Agreement. All technology obtained from
a Third Party pursuant to this Section 2.6 shall be, to the extent possible
under commercially reasonable terms, jointly owned by the Parties and shall be
subject to Articles V and VII.

     2.7. Record-keeping. All committees shall appoint one Party to keep
complete and accurate records pertaining to the Parties' activities hereunder.
The other Party shall have the right to review such records upon reasonable
notice to the recordkeeping party and at reasonable times. Such records are
subject to audit by the other Party pursuant to Section 6.5 within a reasonable
period after the end of the Fiscal Year. In addition, the recordkeeping party
shall prepare quarterly unaudited financials pertaining to such activities,
which shall be distributed to the Parties within thirty (30) days of the end of
such period.

     2.8. Non-compete.

                                      16


<PAGE>

          (a) During the Research Term, neither Party will , independently of
     the other, perform research regarding a Target or a Research Compound which
     is the subject of an approved Research Collaboration Plan.

          (b) During the Term, neither Party may directly or indirectly develop
     or commercialize a Competing Product in the Territory.

          (c) Notwithstanding anything to the contrary contained in this
     Agreement, the Parties agree that Excluded Technology is not included
     within the scope of this Agreement. In particular, nothing in this
     Agreement shall prohibit either Party from performing research, developing
     or marketing compounds or products using Excluded Technology.

     2.9. Board Representation. Regeneron will uses its best efforts to put a
person representing Procter & Gamble (a "P&G Director") on Regeneron's Board of
Directors sixty (60) days after Regeneron receives written notice from Procter &
Gamble at any time during the Term. The Parties shall work together to identify
a mutually agreeable P&G Director; however, if the Parties cannot agree upon a
P&G Director within thirty (30) days of Regeneron's receipt of Procter &
Gamble's written notice, Procter & Gamble shall designate an officer of Procter

& Gamble as a P&G Director and Regeneron shall uses its best efforts to have
such P&G Director appointed or nominated and elected as a Director on
Regeneron's Board of Directors. Notwithstanding anything to the contrary,
Regeneron shall have no obligation pursuant to this Agreement to take any action
that would result in more than one P&G Director sitting on Regeneron's Board of
Directors at any one time, nor shall Regeneron have any obligations with respect

to appointing or nominating a P&G Director under this Section 2.9 so long as
Procter & Gamble owns less than fifteen percent (15%) of Regeneron's Outstanding
Securities (as defined in the Securities Purchase Agreement).

     2.10. Vetoed Project. Procter & Gamble shall have the right to veto a
proposed Research Project ("Vetoed Project") if in good faith it determines that
the Target proposed for the project is a part of an existing Procter & Gamble
program as defined by an internal Procter & Gamble research project proposal and
an approved annual budget. All of Procter & Gamble's ownership rights pursuant
to Section 5.1 to inventions directly related to the Vetoed Project made solely
by Regeneron employees shall revert to Regeneron. All of Regeneron's ownership
rights pursuant to Section 5.1 to inventions directly related to the Vetoed
Project made solely by Procter & Gamble employees shall revert to Procter &
Gamble. Regeneron may not pursue the Vetoed Project during Fiscal Years *****.
At any time after Fiscal Year ***, Regeneron may elect to pursue the Vetoed
Project if, during the twelve (12) months prior to that election, (a)

                                      17


<PAGE>

     Regeneron has not Opted Out of research, development or marketing of a
     Compound and (b) has not required Procter & Gamble to purchase securities
     pursuant to Section 3.5 of the Securities Purchase Agreement. Upon such
     election and notice to Procter & Gamble, the Vetoed Project shall be deemed
     an Excluded Research Project. If Regeneron makes such an election, then
     Regeneron may not require Procter & Gamble to purchase securities pursuant
     to Section 3.5 of the Securities Purchase Agreement during the twenty-four
     (24) months following the election. In addition, if Regeneron Opts Out of
     the research, development or marketing of a Compound during the twenty-four
     (24) months following the election, then Regeneron may either (a) terminate
     work on the Vetoed Project or (b) have the royalties payable by Procter &
     Gamble under Section 6.1 with respect to such Compound shall be reduced by
     *****. If Regeneron elects to terminate work on the Vetoed Project, then
     the Vetoed Project will be deemed to never have been a Vetoed Project and
     the rights to inventions made solely by Regeneron employees or solely by
     Procter & Gamble employees directly related to the Vetoed Project shall be
     jointly owned by Procter & Gamble and Regeneron as set forth in Section
     5.1.

                   Article III - Research and Development

     3.1. Research Collaboration Plan.  The Parties will agree to a Research
Collaboration Plan within sixty (60) days after the Effective Date. The OC is
authorized to approve and amend the Research Collaboration Plan. The timing and
calculations for the Research Collaboration Plan budget for Fiscal Year 6 and
beyond are contained in Attachment 3.1. In Fiscal Years 1 through 5, the

Research Collaboration Plan budget shall include FTE allocations and any Third
Party costs.

     3.2. Funding of Research Collaboration Plan.

          (a) Fiscal Years 1 through 5. During the first five (5) Fiscal Years
     of the Research Term, Regeneron shall provide the following number of
     Regeneron research FTEs per Fiscal Year for Regeneron's work pursuant to
     the Research Collaboration Plan:

          Fiscal Year                             Regeneron FTEs
            1                                          ***
            2                                          ***
            3  (JAS, OND '99)                          ***
            3  (JFM, AMJ, '00)                         ***
            4                                          ***
            5                                          ***

                                   18


<PAGE>

     Procter & Gamble may, at its sole discretion, fund an additional *****
     Regeneron research FTEs in the last six months of Fiscal Year 3, Fiscal
     Year 4 and Fiscal Year 5 ("Option Period") at Procter & Gamble's written
     request . Procter & Gamble will give three (3) months' notice to Regeneron
     prior to the beginning of such Option Period that it elects to fund such
     additional ***** Regeneron research FTEs for the entire Option Period.
     While Procter & Gamble funds the additional ***** FTEs during the Option
     Period, Regeneron shall also fund and supply ***** additional Regeneron
     research FTEs for the entire Option Period. These ***** Regeneron research
     FTEs (*** funded by Procter & Gamble, *** funded by Regeneron) during the
     Option Period shall initially be devoted to research in the Muscle Field,
     but may be assigned to other Research Projects as the Parties may mutually
     agree. Procter & Gamble shall make research payments pursuant to Section
     3.2(d). All costs associated with work by Procter & Gamble pursuant to the
     Research Collaboration Plan shall be borne by Procter & Gamble. In
     addition, Procter & Gamble shall pay for all Third Party costs for which it
     approves in its sole discretion.

          (b) Fiscal Years 6 through 10. If Procter & Gamble and/or Regeneron do
     not  terminate the Research Term at the end of Fiscal Year 5 pursuant to
     Section 10.2, the Parties shall equally fund Allowable Research Expenses
     associated with the Research Collaboration Plan for work done after the
     fifth (5th) Fiscal Year. Allowable Research Expenses shall include: (i) at
     least ***** Regeneron research FTEs at the FTE Rate specified in Section
     3.2(d) plus the Inflation Payment Adjustment described in Section 3.2(d);
     (ii) no more than ***** Procter & Gamble FTEs, unless there is a
     Development Compound in the Muscle Field and in such case, such Procter &
     Gamble FTE number shall not exceed ****** Procter & Gamble FTEs, at an FTE
     rate(s) agreed by the OC pursuant to the "FTE cost calculation process" set
     forth in Attachment 3.1; and (iii) any additional Allowable Research
     Expenses. At Regeneron's option during Fiscal Years 6 through 10, Regeneron
     may require Procter & Gamble to purchase Regeneron equity pursuant to

     Section 3.5 of the Securities Purchase Agreement. Subject to the Parties'
     minimum funding commitments pursuant to this Section 3.2(b), either Party
     may become an Opting Out Party with respect to specific Research Projects.

          (c) Regeneron Proposals to Increase Regeneron FTEs in Fiscal Years 
     6 - 10. Regeneron may propose increases in Regeneron research FTEs *****
     Regeneron research FTEs or more above the Regeneron research FTE threshold
     set forth in Section 3.2(b) to the OC, provided that Regeneron has met and
     continues to meet its obligations (including without limitation funding
     obligations pursuant to this Section 3.2) under this Agreement. However,
     Regeneron may not make such proposals if Regeneron is an

                                      19


<PAGE>

     Opting Out Party under Section 3.2(b) or has received additional equity
     purchases by Procter & Gamble pursuant to Section 3.5 of the Securities
     Purchase Agreement. Regeneron must make any such proposal at least *****
     months prior to the beginning of Fiscal Year 6, or the beginning of any
     subsequent Fiscal Year. Procter & Gamble shall have ***** days from the
     time of Regeneron's proposal to the OC to agree to or reject such Regeneron
     research FTE increases. If Procter & Gamble rejects such increases, the OC
     shall define one or more Excluded Research Projects involving a research
     area which has not been the subject of a Research Project Plan in a manner
     acceptable to both Parties, and of a scope consistent with the increased
     Regeneron research FTEs proposed by Regeneron. If an Excluded Research
     Project has been agreed to by the OC, Procter & Gamble will be deemed an
     Opting Out Party with respect to any compound resulting from that Excluded
     Research Project. Such compound will be considered a "Compound" for
     purposes of Sections 5.7 and 6.1.

          (d) Regeneron's FTE Rate; Payment. Procter & Gamble's funding will be
     made pursuant to Attachment 3.2(d)(1). An additional Inflation Payment
     Adjustment shall be made in Fiscal Years 1 through 10 pursuant to
     Attachment 3.2(d)(2). Such Inflation Payment Adjustment shall be based on
     Regeneron's annual cost per research FTE of ***** ("FTE Rate"). The FTE
     Rate includes costs such as those listed in Attachment 3.2(d)(3). The
     Inflation Payment Adjustment shall be calculated by multiplying the number
     of Regeneron research FTEs per Fiscal Quarter listed in Attachment
     3.2(d)(2) by the FTE Rate Adjustment, which is defined as the quarterly
     equivalent of the FTE Rate multiplied by the percentage change (rounded to
     the nearest tenth of a percent) between the Consumer Price Index for All
     Urban Consumers as published by the U.S. Bureau of Labor Statistics ("CPI")
     for June 1997 versus the CPI for the month of June immediately preceding
     the Fiscal Year in which such payments are applicable. The calculation for
     and examples of such Inflation Payment Adjustments are detailed in
     Attachment 3.2(d)(2). Regeneron shall use funding provided under this
     Section 3.2 solely for carrying out the Research Collaboration Plan.
     Regeneron shall submit a report to Procter & Gamble within forty-five (45)
     days after the end of each Fiscal Quarter detailing the number of FTEs
     performing work pursuant to the Research Collaboration Plan and detailed
     description of such work. Regeneron shall submit invoices to Procter &
     Gamble pursuant to this Section 3.2(d), including, if applicable, a

     calculation of any amounts payable as Inflation Payment Adjustments,
     quarterly in arrears. Invoices submitted to Procter & Gamble pursuant to
     this Section are payable net thirty (30) days after receipt and are subject
     to Procter & Gamble's audit pursuant to Section 6.5.

                                      20


<PAGE>

     3.3. Selection of Development Compounds.

          (a) The PC or either Party may propose to the OC that a Research
     Compound be further developed as a Development Compound, if such Compound
     has undergone sufficient testing to demonstrate that it has met the Success
     Criteria established pursuant to a Research Project Plan.

          (b) If the OC agrees that the Research Compound meets the Success
     Criteria, then the Compound shall be designated a Development Compound.
     Within ***** days after the designation of a Development Compound by the
     OC, the OC shall approve a Product Plan for such Development Compound. The
     Product Plan shall include general goals of the Parties relating to the
     development and marketing of each Development Compound and the timing,
     nature, and priority of resources to be applied and will detail tasks and
     goals, personnel allocation, outside services and costs, Success Criteria,
     Allowable Product Expenses, budgets, and such other matters deemed
     necessary to implement the Product Plan. The Product Plan will include a
     spending forecast through the end of clinical trials for the Development
     Compound and a budget for the next Fiscal Year that will be updated by the
     OC at least annually on a Fiscal Year basis. Procter & Gamble is
     responsible for taking the lead in proposing such budget with significant
     and timely input from Regeneron. The timing and calculations for the
     typical Product Plan budget is contained in Attachment 3.1 as an example.
     The OC will have complete authority to adopt all Product Plans.

     3.4. Funding of Development Compounds and Marketed Compounds; Opting Out.

          (a) Allowable Product Expenses. Allowable Product Expenses for
     Development  Compounds in the Muscle Field shall be shared equally.
     Allowable Product Expenses to support an Investigational New Drug
     application (IND) pursuant to 21 C.F.R. ss.312.1 et seq. for Development
     Compounds other than those Development Compounds in the Muscle Field in
     Fiscal Years 1 through 5 shall be paid by Procter & Gamble; all other
     Allowable Product Expenses for such Development Compounds shall be shared
     equally. Allowable Product Expenses shall be payable quarterly in arrears,
     based on justification of Allowable Product Expenses incurred over the
     quarter. Regeneron and Procter & Gamble shall submit reports to each other
     within thirty (30) days of the end of each Fiscal Quarter detailing the
     number of FTEs performing work pursuant to the Product Plan, Third Party
     costs and other costs incurred in research, development and marketing
     activities, as well as a detailed description of such work. Each Party
     shall review and approve the other Party's reports within fifteen (15) days

                                      21



<PAGE>

     thereafter, subject to the OC's approval, if necessary. Procter & Gamble
     will then calculate the amount that shall be paid by either Party to the
     other Party to equalize funding and so advise Regeneron within seven (7)
     days. The Party to whom funds are owed will issue an invoice for the
     corresponding amount, payable within thirty (30) days. Costs incurred and
     paid pursuant to this Section are subject to audit pursuant to Section 6.5.

          (b) After the end of Fiscal Year 5, either Party may become an Opting
     Out Party with respect to a Research Project, thereby Opting Out with
     respect to all further development and marketing of all Lead Compounds that
     result from that Research Project in the Territory. Either Party may, at
     any time during the Term, become an Opting Out Party with respect to a
     Development Compound or Marketed Compound, either in total or on a
     country-by-country basis pursuant to Section 3.6. The Proceeding Party may
     proceed to research, develop and/or market such Compound at its own
     expense. However, unless the Parties otherwise agree, a Party may not Opt
     Out from or otherwise not pay its share of Allowable Research Expenses or
     Allowable Product Expenses to which such Party has committed in a Research
     Project Plan or Product Plan. The Opting Out Party shall grant licenses to
     the Proceeding Party pursuant to Section 5.7. Royalties paid pursuant to
     such licenses shall be made pursuant to Article VI.

          (c) If both Parties are Opting Out Parties with respect to a
     Development Compound or Marketed Compound pursuant to Section 3.4(b), the
     OC shall use Commercially Reasonable Efforts to determine the disposition
     of the rights to such Compounds.

     3.5. Research, Development and Marketing Communication. In addition to
Regeneron's reporting obligations under Section 3.2(d), Regeneron and Procter &
Gamble will submit reports to each other not less than two (2) times per Fiscal
Year presenting a meaningful summary of research, development and marketing
activities performed under this Agreement. Regeneron and Procter & Gamble will
make presentations of such activities to each other, beyond that made to the OC,
as reasonably requested by each other. All technology generated by the Parties
shall be disclosed pursuant to Section 7.1. The Parties shall use their best
efforts to communicate information only within the scope of this Agreement .
Regeneron and Procter & Gamble will also communicate informally and through the
OC to inform each other of research and development done under this Agreement.
Regeneron and Procter & Gamble will provide each other with raw data in original
form or a photocopy thereof for any and all work carried out under this
Agreement as reasonably requested by the other. Any information contained in
such reports and as otherwise communicated by Regeneron or Procter & Gamble is
subject to Article

                                      22


<PAGE>

VIII. If one Party is deemed an Opting Out Party, the Proceeding Party shall
annually report to the Opting Out Party research, development and marketing
activities performed for Compounds in the Territory for the prior Fiscal Year
sufficient to allow the Opting Out Party to determine whether the Proceeding

Party is utilizing Commercially Reasonable Efforts.

     3.6. Global Development. The Product Plan shall set forth commercially
reasonable development work (including without limitation clinical studies) to
support acceptable regulatory applications for marketing clearance in all Major
Countries. The costs associated with these activities shall be deemed "Global
Expenses." If either Party fails to pay its share of Global Expenses with
respect to a Compound, such Party shall be deemed an Opting Out Party with
respect to such Compound in the entire Territory pursuant to Section 3.4(b).
Either Party may Opt Out of the commercialization of a Compound on a
country-by-country basis provided it funds its share of total Global Expenses,
to the extent that funding of any development and/or marketing expenses is
solely attributable to one country and is not considered a Global Expense
("Country Expenses"). A Party that does not pay such Country Expenses shall be
deemed an Opting Out Party with respect to such Compound in that particular
country only pursuant to Section 3.4(b).

     3.7. J-V Formation. Commencing at the end of the ***** Fiscal Year, the
Parties shall negotiate in good faith an agreement by the end of the *****
Fiscal Year that contains all of the terms and conditions of this Agreement,
along with other terms and conditions as the Parties may agree to develop and/or
market Compounds, including without limitation reasonable non-compete provisions
("J-V Agreement"). In the event that the Parties cannot finalize such J- V
Agreement prior to the end of the ***** Fiscal Year the Parties may commence
dispute resolution pursuant to Section 2.5 or the Parties may terminate this
Agreement pursuant to Section 10.2, elect to continue to perform research,
development and marketing activities pursuant to this Agreement until its
termination, or negotiate such other arrangement as the Parties may agree.

     3.8. Sumitomo Compounds.

          (a) Regeneron shall, subject to the confidentiality provisions of
     Article VIII, have the right to disclose to Sumitomo Chemical Company
     Limited and its affiliates (herein "Sumitomo") information regarding a
     Compound solely conceived and reduced to practice by Regeneron solely for
     the purpose of, and to the extent necessary for, enabling Regeneron to
     fulfill its obligations under the Sumitomo Agreement. ****************.

                                      23


<PAGE>

          (b) If Sumitomo does not license MuSK and Agrin in accordance with the
     Sumitomo Agreement, Regeneron has the right to attempt to license MuSK
     and/or Agrin to a Third Party for use, sale, manufacture, distribution, and
     marketing solely in Japan. Regeneron shall have the right to provide such
     Third Party, solely for the purpose of obtaining such license and subject
     to the confidentiality provisions of Article VIII, information about MuSK
     and Agrin developed after the Effective Date. *************.

Article IV -  Marketing of Products
- -----------------------------------

     4.1. Marketing and Sales Strategy. **************** in the OC regarding the

strategy and tactics of marketing and sale of the Marketed Compounds in
accordance with the Product Plan, including without limitation prices of
Marketed Compounds, method of sales and distribution, organization and
management of sales and marketing, packaging and labeling, appointment of
distributors pursuant to Section 4.3 and other terms and conditions for such
sales and marketing. Procter & Gamble shall use Commercially Reasonable Efforts
in making such decisions. That portion of the Product Plan that does not relate
to the sales and marketing strategy (e.g., the annual budget), shall be agreed
to by a majority of the OC.

     4.2. Net Profits.  The Parties, so long as neither Party is an Opting Out
Party with respect to such Marketed Compound either in the entire Territory or
in one or more specific countries, as appropriate, will share equally in the Net
Profits of each Compound sold.  "Net Profits" mean Net Sales less Allowable
Product Expenses.

     4.3. Exclusive Distributor. The OC may appoint either Party or a Third
Party to act as its agent in connection with the marketing, sale and
distribution of Marketed Compounds, and the OC and/or the Parties (as the case
may be) shall grant to such agent(s) appropriate authority to perform its or
their responsibilities hereunder. In connection with such marketing, sales and
distribution, the following principles shall apply:

          (a) the business objective will be to maximize overall profits; and
          (b) in the event that a Third Party is appointed as the Parties' agent
     with respect to the marketing, sale and distribution of the Marketed
     Compound in a country, Regeneron and Procter & Gamble will each receive
     equal shares of any revenue received from such Third Party, so long as
     neither Party is an Opting Out Party with respect to such Marketed Compound
     in such country.

                                      24


<PAGE>

     4.4. Regeneron Co-Promotion Activities. Provided that Regeneron is not an
Opting Out Party with respect to the Compound, Regeneron will have an equal
right and opportunity, but not the obligation, to participate in the sales and
marketing efforts in any country in the Territory as to which it has not Opted
Out by supplying up to fifty percent (50%) of a Marketed Compound's sales and
marketing efforts with notice to Procter & Gamble within ***** days of the OC's
decision to prepare a regulatory application for marketing clearance in the
first Major Country with respect to all Major Countries, then on a
country-by-country basis upon regulatory filings in such countries other than
Major Countries. Regeneron's and Procter & Gamble's sales and marketing
personnel costs shall be an Allowable Product Expense and shall be calculated
for both Parties on the same basis (e.g., the cost per salesperson or sales call
for Regeneron and Procter & Gamble shall be the same per year). If Regeneron
wants to discontinue or decrease its co-promotion activities, it must give
Procter & Gamble ***** months' notice prior to such discontinuation or decrease.
Either Party's choice to not promote a Marketed Compound shall not cause such
Party to be an Opting Out Party with respect to such Marketed Compound, so long
as such Party meets its funding obligations pursuant to Section 3.4.


     4.5. Trademarks; Packaging.  After a Compound has been designated a
Development Compound, the Parties shall jointly develop a trademark for such
Development Compound. So long as it is not an Opting Out Party with respect to
such Compound in a country, Procter & Gamble shall file, prosecute and maintain
all trademark applications and registrations for such trademarks. Procter &
Gamble shall pay all expenses in connection with filing and prosecution of such
trademarks. All other costs associated with such trademarks shall be deemed
Allowable Product Expenses. As long as neither Party is an Opting Out Party with
respect to the Marketed Compound, such Marketed Compound shall be sold under a
single trademark which shall be owned by Procter & Gamble (and Procter & Gamble
shall grant Regeneron a royalty-free license to such trademark(s) if Regeneron
promotes a Marketed Compound pursuant to Section 4.4) or, if a legal entity is
formed pursuant to a J-V Agreement, the trademark shall be owned by such entity
to the extent legally permissible. If one Party is an Opting Out Party with
respect to such Marketed Compound, any trademarks shall be owned by the
Proceeding Party. So long as neither Party is an Opting Out Party, the label of
the Marketed Compound will contain the name of Regeneron and Procter & Gamble,
to the extent legally permissible.

Article V - License Grants
- --------------------------

                                      25


<PAGE>

     5.1. Rights in Technology Developed During Agreement. Patents and Know-how
regarding all inventions, trade secrets and other information, whether tangible
or intangible, whether or not patentable resulting from work by the Parties
under this Agreement shall be owned:

          (a) by Procter & Gamble, if such technology is conceived or reduced to
     practice solely by employees of Procter & Gamble prior to Fiscal Year 6;

          (b) jointly, if such technology is conceived and/or reduced to 
     practice either solely by employees of Regeneron or jointly by employees of
     Procter & Gamble and Regeneron; and

          (c) jointly, if such technology is Procter & Gamble Technology 
     conceived and reduced to practice solely by employees of Procter & Gamble
     during Fiscal Years 6 through 10. Inventorship shall be determined
     according to the laws of the United States. Filing, prosecution,
     maintenance and enforcement of such Patents shall be handled pursuant to
     Article VII. Any use of technology owned by a Party under this Section that
     is conceived solely by employees of the other Party, other than uses which
     have actual or potential utility for the identification, research or
     commercialization of products for the prevention, diagnosis, or treatment
     of diseases or disorders in humans or animals, shall be subject to a
     reasonable royalty to be negotiated. All use of such technology shall also
     be subject to Section 2.8.

     5.2. License Grants during Research Term.
     
          (a)                           Procter & Gamble hereby grants Regeneron

     a Sole License under P&G Patents and Know-how to Procter & Gamble
     Technology conceived and reduced to practice by employees of Procter &
     Gamble prior to Fiscal Year 6, or acquired by Procter & Gamble with the
     right to sublicense prior to or during the Research Term, to make, have
     made, use, import and offer for sale, and sell Lead Compounds and Procter &
     Gamble Targets during the Research Term, subject to Section 2.8. The
     license shall be royalty free for uses which have actual or potential
     utility for the identification, research or commercialization of products
     for the prevention, diagnosis, or treatment of diseases or disorders in
     humans or animals. For all other uses a reasonable royalty will be
     negotiated.

          (b)                           Regeneron hereby grants Procter & Gamble
     a Sole License under Regeneron Patents and Regeneron Know-how to make, have
     made, use, import, and offer for sale and sell Regeneron Technology which
     is (i) conceived or reduced to practice by Regeneron before the Term or
     (ii) acquired by Regeneron from a Third Party with the right to sublicense
     prior to or during the Research Term, subject to

                                      26


<PAGE>

     Section 2.8. The license shall be royalty free for uses which have actual
     or potential utility for the identification, research or commercialization
     of products for the prevention, diagnosis, or treatment of diseases or
     disorders in humans or animals. For all other uses a reasonable royalty
     will be negotiated.

          (c) The licenses granted in (a) and (b) above will not be used by
     either Party independent of this Agreement  in research that, will lead to
     Competing Products.  Any dispute under this Section will be resolved by the
     OC.

          (d) As used herein, "Sole License" shall mean a non-exclusive license
     in the Territory under Know-how or a Patent, without the right to
     sublicense, granted by a "Licensor Party" to the other "Licensee Party,"
     wherein the Licensor Party shall not grant any Third Party rights under the
     Know-how or Patent to the subject matter of the license.

     5.3. Rights upon Termination of Research. Except as otherwise directed
pursuant to Section 10.2 or Section 10.3, the Parties shall grant the following
licenses upon expiration of the Research Term.

          (a) Procter & Gamble hereby grants Regeneron a non-exclusive license 
     in the Territory under P&G Patents and Know-how to Procter & Gamble
     Technology conceived or reduced to practice by employees of Procter &
     Gamble prior to Fiscal Year 6, or acquired by Procter & Gamble with the
     right to sublicense prior to or during the Term to make, have made, use,
     import and offer for sale, and sell Lead Compounds and Procter & Gamble
     Targets.

          (b) Regeneron hereby grants Procter & Gamble a non-exclusive license 
     in the Territory under Regeneron Patents and Regeneron Know-how to make,

     have made, use, import, and offer for sale and sell Regeneron Technology
     which is (i) conceived or reduced to practice by Regeneron before the Term
     or (ii) acquired by Regeneron from a Third Party with the right to
     sublicense prior to or during the Term.

          (c) Licenses  under this Section are royalty free except as follows:

               (i) royalties will be paid  pursuant to Section 6.1 for the 
     marketing of  any Lead Compounds that are not Development Compounds or 
     Marketed Compounds; and

               (ii) a reasonable royalty to be negotiated in good faith will be
     paid for all uses other than the identification, research or
     commercialization of products for the prevention, diagnosis, or treatment
     of diseases or disorders in humans or animals reasonable royalty to be
     negotiated for all other uses.

                                      27


<PAGE>

          (d)Neither Party shall file an Abbreviated New Drug Application 
     ("ANDA") in the U.S. or an equivalent foreign application for generic
     approval for marketing of a Compound using the licenses under this Section.

     5.4. Rights on Termination if Milestones are Met. In the event a Party
terminates the Agreement pursuant to Section 10.2, and if ***** Research
Compounds have been determined by Procter & Gamble or the OC to meet their
Success Criteria pursuant to a Research Project Plan by the end of Fiscal Year
5, then:

          (a) if Procter & Gamble is the terminating party, then Procter &
     Gamble shall grant Regeneron an exclusive, royalty-free license in the
     Territory under P&G Patents and P&G Know-how to make, have made, use,
     import, offer for sale, and sell Lead Compounds and Validated Targets, and
     a non-exclusive, royalty-free license in the Territory under P&G Patents
     and P&G Know-how to make, have made, use, import, offer for sale, and sell
     other Procter & Gamble Technology; or

          (b) if Regeneron is the terminating party, then Regeneron shall grant
     Procter & Gamble an exclusive, royalty-free license in the Territory under
     Regeneron Patents and Regeneron Know-how to make, have made, use, import,
     offer for sale, and sell Lead Compounds and Validated Targets, and a
     non-exclusive, royalty-free license in the Territory under Regeneron
     Patents and Regeneron Know-how to make, have made, use, import, offer for
     sale, and sell other Regeneron Technology.

     5.5. Rights in Technology upon Termination Pursuant to Section 10.3(b).
     
     In the event that Procter & Gamble terminates the Agreement pursuant to  
Section 10.3(b) then the Parties shall grant the following licenses:

          (a) If *** Research Compounds have been determined by Procter & Gamble
     or the OC to have met their Success Criteria pursuant to a Research Project

     Plan at the time of termination, then Procter & Gamble shall grant
     Regeneron an exclusive, royalty-free license in the Territory under P&G
     Patents and P&G Know-how to make, have made, use, import, offer for sale,
     and sell Lead Compounds and Validated Targets, and a non-exclusive,
     royalty-free license in the Territory under P&G Patents and P&G Know-how to
     make, have made, use, import, offer for sale, and sell other Procter &
     Gamble Technology; or

          (b) If Procter & Gamble or the OC have not determined that ***
     Compounds have met their Success Criteria pursuant to a Research Project
     Plan at the time of termination, then (i) Procter & Gamble shall grant
     Regeneron a non-exclusive, royalty free license in the Territory under &G
     Patents and Know-how to Lead Compounds and

                                      29


<PAGE>
     Procter & Gamble Targets conceived and reduced to practice by Procter &
     Gamble, or acquired by Procter & Gamble from a Third Party with the right
     to sublicense, during the Term to make, have made, use, import and offer
     for sale, and sell Lead Compounds and Procter & Gamble Targets; and (ii)
     Regeneron shall grant Procter & Gamble a non-exclusive license,
     royalty-free in the Territory under Regeneron Patents and Regeneron
     Know-how to make, have made, use, import, and offer for sale and sell
     Regeneron Technology which is conceived and reduced to practice by
     Regeneron, or acquired by Regeneron from a Third Party with the right to
     sublicense during the Term.

     5.6. Rights in Compounds under Research, Development and Marketing. Subject
to Section 3.8, a Party shall not grant any license to a Third Party in the
Territory under any Patent or Know-how owned in whole or in part by that Party
to make, have made, use, import or sell any Compound during the Term with
respect to Compounds that are the subject of joint research, development or
marketing by the Parties under this Agreement or a J-V Agreement. The Parties
shall grant licenses under Patents or Know-how to each other, or to any jointly
owned entity as may be established by the Parties pursuant to a J-V Agreement,
as may be necessary to facilitate research, development and/or marketing of such
Compounds in the Territory.

     5.7. Grant of License by Opting Out Party. In the event a Party becomes an
Opting Out Party with respect to a Compound in its entirety or on a
country-by-country basis, then the license granted by the Opting Out Party to
the Proceeding Party shall be an exclusive license, with the right to
sublicense, to make, have made, use, import and sell such Compound under the
Patents, Know-how, trademarks and copyrights regarding that Compound owned in
whole or in part by the Opting Out Party. The license shall be in all countries
of the Territory in which Opting Out has been deemed to occur, and shall be
subject to the royalty set forth in Section 6.1. The Opting Out Party shall
comply with reasonable requests for cooperation by the Proceeding Party, and the
Proceeding Party shall reimburse the Opting Out Party for reasonable
out-of-pocket expenses incurred with respect to such cooperation.

Article VI - Royalties and Accounting


     6.1. Royalty Calculation.

          (a) The Proceeding Party will pay to the Opting Out Party a royalty on
     Net Sales of a Marketed Compound on a country-by-country basis, sold by the
     Proceeding

                                      29


<PAGE>

     Party, its Affiliates, licensees and/or sublicensees in the
     Territory at the applicable rate listed below multiplied by the Net Sales
     in such country:

                    Opt Out Time                             Royalty
                    ------------                             -------

        Prior to the *****                                  up to ****%

        Upon or after designation as  ***  but prior to         ***%
        the *****
 
        Upon or after the *****  but prior to the               ***%
        **********

        Upon or after the***************                        ***%


     Such royalty will be paid for a period of ***** years from the date of
     first sale to a customer of such Compound in a particular country, or for
     so long as the manufacture, use, importation or sale of the Compound would,
     but for the licenses granted herein, infringe a Valid Claim of a licensed
     Patent in such country, whichever is longer.

          (b) If the Parties license the Compound to a Third Party pursuant to
     Section 3.4(c) *****************. Examples of the respective percentages
     are outlined in Attachment 6.1(b). Reasonable out-of-pocket expenses
     incurred in obtaining such licensee shall be shared equally by the Parties.
     Notwithstanding the above, either Party may receive, without sharing with
     the other Party, reimbursement from such licensee for reasonable,
     *********** to account for indirect overhead) costs of research,
     development and/or marketing costs (whether internal or Third Party) to be
     incurred by such Party for work to be conducted in the future on behalf of
     the licensee. Any amounts in excess of such reimbursement shall be shared
     in the same proportion as calculated above in this Section 6.1(b) All
     amounts from licensees received by either Party shall be fully disclosed to
     the other Party and subject to audit (including without limitation the
     calculation of Fully-Loaded costs) pursuant to Section 6.5.

      (c) If the Proceeding Party elects to distribute or sublicense a Compound
     in any country, and a license must be obtained from a Third Party to
     manufacture and/or market such Compound to avoid a non-frivolous claim of
     patent infringement, the Proceeding Party shall offset the following
     portion of the Third Party license fee, royalty or other similar payments

     ("Licensee Fees") against the Opting Out Party's royalty:

********************************
        --------------------------------

***                 ***
***                 ***


                                      30


<PAGE>

***    ***
***    ***

          Any portion of Licensee Fees paid by the Proceeding Party that is to
     be offset against the Opting Out Party's royalty but that exceeds the
     Opting Out Party's royalty payable, shall be carried forward and accrue
     interest pursuant to Section 6.4 and be offset against future royalties as
     such royalties become payable.

     6.2. Royalty Payment.

          (a) Royalties payable under Section 6.1 will be paid not later than 
     sixty (60) calendar days following the end of each Fiscal Quarter. All
     payments shall be accompanied by a report in writing showing the Fiscal
     Quarter for which such payment applies, the amount billed to Third Parties
     for Marketed Compounds sold during such Fiscal Quarter, the deductions from
     the amount billed to arrive at the Net Sales, the Net Sales for the Fiscal
     Quarter, and the royalties due on such Net Sales, such report being broken
     down by Marketed Compound and country. All royalties will be paid in the
     currency where Net Sales take place or, at the option of the payee, in US
     dollars at a rate of exchange on the last business day of the Fiscal
     Quarter as quoted in The Wall Street Journal (or Citibank, N.A. if such
     rates are not available in The Wall Street Journal).

          (b) All royalties due under this Article VI will be deposited in a
     bank chosen by the recipient by the date due. Any amounts or royalties
     prohibited from export by a particular country will be deposited in a bank
     chosen by the recipient in such country. Any deductions for withholding
     taxes imposed by the country in which Net Sales take place will be withheld
     and paid as required by law. The amount of tax withheld shall be for the
     account of the Party receiving the payment. The amount of withholding tax
     will be allocated, if applicable, in the ratio of the respective income to
     which the withholding tax is related. The paying Party will provide
     promptly upon request any receipts from the governmental or taxing
     authority evidencing payment of such taxes and will assist the receiving
     Party in claiming relief from double taxation.

     6.3. Records. Procter & Gamble and Regeneron will maintain, and will 
require their Affiliates and sublicensees to maintain, complete and accurate
records of Net Sales of Marketed Compounds sold subject to the royalty
provisions of Section 6.1 and the audit provisions of Section 6.5.


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<PAGE>

     6.4. Interest Rate. Unless otherwise provided in this Agreement, any
payments past due will bear interest at the prime rate (such quoted in The Wall
Street Journal on the first day of the month of the accrual) plus two (2)
percentage points, compounded monthly.

     6.5. Audit. Records shall be open for audit during reasonable business
hours for a period of three (3) years from creation of individual records for
examination not more often than once each year by an independent certified
public accountant ("CPA") selected by the payee and reasonably acceptable to the
payer for the sole purpose of verifying the correctness of payments to be made
under this Agreement. If the CPA finds a discrepancy of greater than ten (10)
percent of such payment, the CPA shall submit a detailed report regarding the
audit and such discrepancy to both Parties within thirty (30) days of commencing
the audit. The Parties shall attempt to resolve such discrepancy to their mutual
satisfaction during the next fifteen (15) days. If the Parties cannot resolve
the discrepancy, their CEOs shall meet within ten (10) days after such fifteen
(15) day time period. If the CEOs cannot resolve the dispute within five (5)
days, either Party may take such dispute to arbitration pursuant to Section
11.4. The calculation of such payment shall be deemed final (and not subject to
audit or dispute resolution) five (5) years after the period in which such
payment was due, unless arbitration pursuant to Section 11.4 is commenced prior
to such time. Out-of-pocket expenses incurred with respect to such CPA shall be
paid by the payee; however, the payer shall reimburse the payee for such CPA
expenses if the discrepancy is greater than ten (10%) percent, as such
discrepancy is determined by the CEOs or arbitrators.


                   Article VII - Patents and Infringement
                   --------------------------------------

     7.1. Disclosure. Procter & Gamble will promptly disclose to Regeneron all
Procter & Gamble Technology described in Section 1.31. Regeneron will promptly
disclose to Procter & Gamble all Regeneron Technology described in Section 1.34
The Parties intend that there be a timely and full exchange of all information
arising from each Research Collaboration Plan or Product Plan subject to the
terms and conditions of this Agreement. Each Party shall promptly disclose to
the other Party any critical data or development which it reasonably believes
would or could have a material effect, whether positive or negative, on a
Research Collaboration Plan or Product Plan.

     7.2. Patent Applications. Regeneron and Procter & Gamble will discuss and
evaluate Technology disclosed pursuant to Section 7.1, and confer regarding the
advisability of filing patent applications to cover any Technology. The Party
(herein "Responsible Party") for the

                                      32


<PAGE>


filing, prosecution and maintenance of patent applications shall be: (a) Procter
& Gamble, if the subject invention is made solely by employees of Procter &
Gamble; (b) Regeneron, if the subject invention is made solely by employees of
Regeneron; or (c) determined by agreement of the Parties for all other
inventions, taking into account the nature of the invention and the relationship
of the invention to inventions claimed in other patents or applications.
Regeneron and Procter & Gamble will discuss with each other the advisability of
filing Patent applications beyond the priority country.

     7.3. Filing and Prosecution of Patents. The Responsible Party shall, at its
expense, diligently file, prosecute, issue, and maintain patent applications
according to its own internal standards and for effectively covering other
inventions made by its employees or consultants. The Responsible Party will
endeavor to ensure that all patent applications are filed before any public
disclosures so as to ensure validity of patent applications filed outside of the
United States. The Responsible Party will submit a substantially complete draft
of each patent application to the other Party at least thirty (30) days prior to
the contemplated filing date and consider any comments of the other Party,
provided that in those circumstances where the Responsible Party believes time
is of the essence, the Responsible Party will endeavor to provide the other with
such advance notice as it reasonably can under the circumstances. Regeneron and
Procter & Gamble will confer with each other regarding the prosecution of such
Patent Applications and will copy each other with any official action and
submission in such Patent Applications.

     7.4. Alternate Responsibility for Prosecution. In the event the Responsible
Party determines that it will not file, prosecute, issue or maintain, a Patent
in a particular country, it shall promptly notify the other Party. The other
Party shall then have the right, but not obligation to assume responsibility for
the Patent, and thereby become the Responsible Party for that Patent pursuant to
Section 7.3. The other Party shall be given all necessary authority by the
original Responsible Party to file, prosecute, issue, and maintain the Patent.

     7.5. Infringement.  Procter & Gamble and Regeneron shall promptly notify
the other in writing of any infringement of a Patent within the Patent Rights
licensed or to be licensed pursuant to Article V of which they become aware.

     7.6. Enforcement of Patents. Regeneron and Procter & Gamble may, but shall
not be required to, prosecute any alleged infringement or threatened
infringement of a Patent within the Patent Rights of which they are aware or
which is brought to their attention. The prosecuting 

                                      33


<PAGE>

Party shall act in its own name and at its own expense unless the other Party at
its option pays fifty percent (50%) of all reasonable out-of-pocket costs.
Regeneron and Procter & Gamble shall cooperate fully with each other including,
if required to bring such action, the furnishing of power of attorney. Any
recovery obtained shall belong to the prosecuting Party unless the other Party
has paid fifty percent (50%) of said costs in which case each Party will receive
fifty percent (50%) of any recovery.


     7.7. Alternate Responsibility for Enforcement. If Regeneron or Procter &
Gamble has failed to prosecute under Section 7.6 with respect to alleged or
threatened infringement of one of its Patents (i) three (3) months after it has
been notified in writing by the other of such alleged infringement or (ii) one
(1) month before the time limit, if any, set forth in the appropriate laws and
regulations for the filing of such actions, whichever comes first, the other
may, but shall not be required to, prosecute any alleged infringement or
threatened infringement of the Patent. Such prosecuting Party shall act in its
own name and at its own expense. In such event, both Parties shall cooperate
fully with each other at their own expense, including if required in order to
bring such an action, the furnishing of a power of attorney. Any recovery
obtained shall belong to the prosecuting Party.

     7.8. Trademark Infringement and Enforcement. Procter & Gamble and Regeneron
shall promptly notify the other in writing of any infringement of a trademark
under Section 4.5 of which they become aware. The owner of the trademark
application or registration may, but shall not be required to, prosecute any
such alleged infringement or threatened infringement. The prosecuting Party
shall act in its own name (unless joinder of the other Party is required by law
in which case it shall be joined) and at its own expense unless the other Party
at its option pays fifty percent (50%) of all reasonable out-of-pocket costs.
Regeneron and Procter & Gamble shall cooperate fully with each other in such
action. Any recovery obtained shall belong to the prosecuting Party unless the
other Party has paid fifty percent (50%) of the costs in which case each Party
will receive fifty percent (50%) of any recovery.

     7.9. Alternate Responsibility for Trademark Enforcement. If the owner of
the trademark application or registration has failed to prosecute under Section
7.8 with respect to an alleged or threatened infringement of a trademark (i)
three (3) months after it has been notified in writing by the other of such
alleged infringement or (ii) one (1) month before the time limit, if any, set
forth in the appropriate laws and regulations for the filing of such actions,
whichever comes first, the other Party may, but shall not be required to,
prosecute any alleged infringement or threatened infringement of the trademark.
Such prosecuting Party shall act in its own name

                                      34


<PAGE>

and at its own expense. In such event, both Parties shall cooperate fully with
each other at their own expense. Any recovery obtained shall belong to the
prosecuting Party.


                        Article VIII - Confidentiality
                        ------------------------------

     8.1. Confidentiality and Non-Use Obligations.  Each Party shall maintain in
confidence all information (herein "Information") which is:

          (a) disclosed to it by the other Party pursuant to Section 7.1; 
          (b) developed by the Party during the Research Term; or 
          (c) other information ("Other Information") disclosed by the other 

     Party which is not within the scope of the collaboration and which is
     considered confidential by the other Party, and so designated as
     confidential in writing when first disclosed or within thirty (30) days
     after disclosure if the first disclosure is oral.
     The Party shall take all reasonable precautions to:
          (d) prevent disclosure of such Information to Third Parties, except as
     set forth in Section 2.6, Section 8.3 and Section 11.10, or as may be
     necessary for the filing or prosecution of patent applications pursuant to
     Article VII;
          (e) use Know-how pursuant to the rights and obligations of the Party
     pursuant to Article V; and
          (f) use Other Information only for the purposes of this Agreement.
     These restrictions upon disclosure and use of Information shall terminate
     ten (10) years after the date such Information is developed or disclosed as
     set forth above, but shall not apply to any specific portion of Information
     which:

               (i) is Other Information already in the possession of a Party at
          the time of disclosure by the other Party;

               (ii) is or later becomes available to the public other than by
          default by the Party;

               (iii) is received from a Third Party having no obligation of
          confidentiality to the other Party;

               (iv) is Other Information developed by the Party entirely without
          reference or use of Information, as established by probative
          documentary evidence; or

               (v)  is required to be disclosed by law or government regulation.

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<PAGE>

     8.2. Prior Confidentiality Agreements. The "Confidential Disclosure
Agreement" dated February 25, 1997 and the Collaboration Agreement dated
December 11, 1996 between Regeneron Pharmaceuticals, Inc. and Procter & Gamble
have separately been rendered void and all Information to be kept confidential
under such agreements as of the Effective Date will be subject to the terms of
Section 8.1 as if disclosed under this Agreement.

     8.3. Research Manuscripts and Abstracts. It is understood the Parties may
wish to publish or otherwise disclose technology to a Third Party for
publication in a reputable scientific forum (for example, as an abstract, poster
presentation, lecture, article, book, or any other means of dissemination to the
public). Either Party may make such a disclosure to a Third Party regarding
preclinical research solely invented by its own employees, provided such Party
has filed a patent application adequately describing and claiming any technology
embodied in such disclosure pursuant to Article VII. If such disclosure is
related to clinical research or work jointly invented by the Parties, no such
disclosure will be made to a Third Party until a patent application has been
filed adequately describing and claiming any patentable technology embodied in

such disclosure pursuant to Article VII and the non-disclosing Party has been
provided thirty (30) days to review and comment on such disclosure. Such
disclosures may be made to a Third Party regarding clinical research only if
clinical data has been locked and if disclosure presents no significant risk to
regulatory filings and serves a compelling business reason for publication. Any
disputes regarding the appropriateness and content of any such disclosure shall
be resolved by the PC.


         Article IX - Representations, Warranties and Indemnification
         ------------------------------------------------------------

     9.1. Patents.
          (a) Each Party warrants that, as of the Effective Date, it has no
     actual knowledge of any information rendering invalid or unenforceable any
     Patent licensed to the other Party under Article V or VII. Each Party will
     promptly inform the other Party immediately if it obtains such information
     after the Effective Date.

          (b) Each Party warrants that it is has no actual knowledge of any
     patents or Know-how owned by a Third Party that might prevent, inhibit, or
     limit the Parties from conducting the research, development and marketing
     activities under this Agreement other than what has been previously
     disclosed. Each Party warrants that, except as disclosed in Attachment
     9.1(b), it has not entered into any agreement with a Third Party that might
     prevent, inhibit, or limit the Parties from conducting the research,
     development and marketing activities under this Agreement. Regeneron
     warrants that Attachments

                                      36


<PAGE>

     1.13 and 9.1(b) are complete lists of Excluded Technology and Third Party
     Agreements relating to Excluded Technology, respectively, existing as of
     the Effective Date.

     9.2. No Guarantee. The Parties understand that the research and development
work to be conducted pursuant to this Agreement will involve untested,
experimental, and currently undeveloped technology and that neither Regeneron
nor Procter & Gamble guarantees the safety or usefulness of any Compound. Except
as expressly set forth in this Agreement, the Parties disclaim all warranties of
any nature, express or implied.

     9.3. Indemnification.

          (a) Indemnification Regarding Joint Activities, General. Any and all
     liability, damage, loss, cost (including without limitation reasonable
     attorneys' fees) and expense resulting from any suits, claims, actions,
     demands, liabilities, expenses and/or loss ("Losses") relating to the joint
     development, manufacture, use, storage, distribution or sale of any
     Compound ("Joint Activities") will be shared equally. Each Party shall
     indemnify and hold harmless the other Party for such Party's respective
     share of such liability; provided, however, that the portion of Losses due

     to the gross negligence or willful or intentional misconduct of either or
     both Party(ies) shall be governed by Section 9.3(b).

          (b) Indemnification by the Parties. Each Party shall indemnify and
     hold the other Party harmless from and against that portion of any and all
     Losses due to the gross negligence or willful or intentional misconduct of
     such indemnifying Party, as well as any Losses that were not caused by
     Joint Activities.

          (c) Indemnification by the Proceeding Party. The Proceeding Party
     agrees to save, defend and hold the Opting Out Party harmless from and
     against any and all Losses to the extent that such factual allegations
     forming the primary basis for such Losses occurred after the Party became
     an Opting Out Party with respect to that Compound and/or country. Both
     Parties shall provide prompt notice to the other of such potential Losses.
     The Proceeding Party shall assume control of the defense of the potential
     Losses (including without limitation the right to settle the claim). The
     Opting Out Party shall provide reasonable cooperation to the Proceeding
     Party, and the Proceeding Party shall reimburse the Opting Out Party its
     reasonable out-of-pocket expenses.

          (d) Indemnification Procedure. In the event that either Party receives
     notice of potential Losses, such Party shall immediately inform the other
     Party and the OC. The OC shall decide the manner in which to respond to and
     handle the claim. If the OC cannot decide on how to respond to the claim
     prior to five (5) days before the answer is

                                      37


<PAGE>

     due, the Party receiving the notice shall answer the claim and take
     reasonably necessary actions to defend itself, and the other Party may
     appoint its own counsel at its own expense, until the OC agrees on how to
     handle the claim.


              Article X - Term, Termination; Change of Control
              ------------------------------------------------

     10.1. Effective Date and Term.
          (a) Effective Date. Within three (3) days of the date first written
     above, the Parties shall file the appropriate documents with the U.S.
     Federal Trade Commission and the U.S. Department of Justice pursuant to the
     Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and
     including such Act's enabling regulations (collectively "HSR"). This
     Agreement shall become effective upon such date that the applicable HSR
     waiting period has expired or is otherwise terminated ("Effective Date").

          (b) Term. Unless terminated earlier by mutual agreement or by either
     Party pursuant to Sections 10.2 or 10.3 , this Agreement shall commence on
     the Effective Date and expire at the later of (i) the end of the Research
     Term; (ii) the end of development and marketing of the last Compound to be
     developed or marketed (unless such compound is the subject of a separate

     agreement); or (iii) the end of the Royalty Term. Rights in technology
     shall be as set forth in Section 5.3.

     10.2. Termination. Either Party may terminate the Research Term, and may
terminate the Agreement, provided there are no remaining royalty obligations, at
the end of Fiscal Year 5. Such termination may be made following notice to the
other Party delivered prior to the end of Fiscal Year 4. Rights in technology
shall be as set forth in Section 5.3. However, if *** Research Compounds have
been determined by Procter & Gamble or the OC to meet their Success Criteria
pursuant to a Research Project Plan by the end of Fiscal Year 5, then the
terminating Party shall be granted rights pursuant to Section 5.4, and any
license that had been granted to the terminating Party pursuant to Sections 5.6
or 5.7 shall be terminated.

     10.3. Default. 
          (a) General Default. Failure by either Party (the "Defaulting Party")
     to comply with any of the material obligations contained in this Agreement,
     the Securities Purchase Agreement, the Registration Rights Agreement, the
     Warrants Purchase Agreement or any J-V Agreement shall entitle the other
     Party (the "Nondefaulting Party") to give to the Defaulting Party notice
     specifying the nature of the default and requiring it to cure such default.
     If the Defaulting Party disagrees with the existence, extent or nature of
     the

                                      38


<PAGE>

     default, the Parties shall use good faith efforts to resolve the
     dispute within thirty (30) days. If (i) such default is not cured with such
     thirty (30) day period after the receipt of such notice or (ii) the Parties
     have not otherwise resolved the dispute during such thirty (30) day period,
     the Nondefaulting Party shall be entitled to initiate arbitration under
     Section 11.4 and at its sole discretion terminate this Agreement. In the
     event of such termination, and in addition to any other remedies available
     to the Nondefaulting Party, the Defaulting Party shall be deemed an Opting
     Out Party with respect to any compounds pursuant to Section 5.7.

          (b) Special Default. Regeneron shall promptly notify Procter & Gamble
     if any of its Key Executives leaves, or makes a decision to leave the
     employment of Regeneron prior to the beginning of Fiscal Year 5. The
     "Regeneron Key Executives" are listed in Attachment 10.3(b). Procter &
     Gamble may, after the end of a ***** waiting period following such
     notification, provide Regeneron with notice of termination, with the
     termination to be effective ***** after such notice of termination of the
     Agreement. Rights in technology shall be as set forth in Section 5.5.

     10.4. Change of Control.
          (a) In the event of a Change in Control, as that term is defined in
     Section 10.6(a), of either the Parties or their respective Affiliates that
     have responsibilities or obligations under this Agreement (each
     collectively or individually then referred to as the "Acquired Company")
     and the Acquired Company is not an Opting Out Party with respect to all
     Compounds in all countries under this Agreement, then the Party affiliated

     with the Acquired Company shall notify the other Party of any such Change
     in Control as soon as the Change in Control may publicly be announced. Upon
     receipt of any such notification, the other Party or an Affiliate thereof
     (the "Electing Company") shall have the unilateral right to give notice to
     the Acquired Company within ***** days after its next regularly scheduled
     board meeting, but in no event longer than ***** days, after receipt of the
     Acquired Company's notification that the Electing Company:

               (i) elects not to continue the research, development and 
          marketing  collaboration, whether or not a J-V has been formed (the
          "Option"), in which case a determination of the License Fee pursuant
          to Section 10.7 will be made, and within ***** following such License
          Fee determination will make the further election either to purchase
          the entire interest of the Party affiliated with the Acquired Company
          under this Agreement or any J-V 

                                      39


<PAGE>

          Agreement ("Acquired Company Interest") or offer the Acquired Company
          the option to purchase the entire interest of the Electing Company
          under this Agreement or any J-V Agreement ("Electing Company
          Interest") at the License Fee (but in the event that the Acquired
          Company does not desire to purchase the Electing Company Interest, the
          interests of the Parties shall be disposed of by sale, license or
          other commercially reasonable arrangement for a price that maximizes
          value for both Parties, paid by a Third Party or a Party, and each
          Party shall have the right to receive half of the consideration thus
          obtained), or

               (ii) desires to continue the collaboration for a period of up to
          ****** from the date of the Change in Control (the "Trial Period")
          upon the express condition that the ultimate parent of the entity
          acquiring control of the Acquired Company within ***** days thereafter
          agrees in writing to such Trial Period and otherwise agrees to be
          bound by the provisions of this Agreement, the Registration Rights
          Agreement, the Securities Purchase Agreement, Warrant Agreement and
          any J-V Agreement. If the ultimate parent of the acquiring entity
          accepts these conditions, the collaboration shall continue, and the
          Option shall expire unless the Electing Company exercises the Option
          within ***** days prior to the expiration of the Trial Period. If the
          ultimate parent of the acquiring entity fails to give notice within
          the required period that it will be bound by the provisions of such
          aforementioned Agreements, the Electing Company shall be deemed to
          have exercised the Option as of the expiration of such **** day period
          and the Parties shall then follow the procedures set forth in this
          Section 10.6.

     10.5. Substantial Stock Accumulation. In the event of a Substantial Stock
Accumulation in either the Procter & Gamble Parent or the Regeneron Parent, as
soon as the Party affiliated with the Affected Company has knowledge of the
Substantial Stock Accumulation, it shall give prompt notice to the other Party.
Such notice shall be separate from and in addition to the notice provided for in

Section 10.4 and must be given regardless of whether the Party affiliated with
the Affected Company regards the Substantial Stock Accumulation as being not in
the best interest of the collaboration. From the date on which the Party
affiliated with the Affected Company has notice of the Substantial Stock
Accumulation, the following provisions shall become effective and remain
effective until the Substantial Stock Accumulation is eliminated, unless
otherwise agreed:

               (i) If the Party that is not affiliated with the Affected Company
          reasonably determines in good faith that the person or entity making
          the Substantial Stock Accumulation is a competitor of such Party or
          its Affiliates, such Party may so inform the other Party in writing.
          Promptly after receipt of such notice, the Party affiliated with the
          Affected Company shall establish a 

                                      40


<PAGE>


          procedure whereby no director or executive employee of the Affected
          Company who was not a director or employee of the Affected Company
          prior to the Substantial Stock Accumulation, and who was previously a
          director or employee of the person or entity making the Substantial
          Stock Accumulation (a "Tainted Director or Executive"), shall receive
          any of the following: (x) confidential information of the other Party
          and its Affiliates; and (y) confidential information of the
          collaboration, except that any such Tainted Director or Executive can
          be given information as to actual and projected sales and profits of
          the collaboration.

               (ii) If the Party that is not affiliated with the Affected
          Company does not give notice pursuant to this Section 10.5, the Party
          affiliated with the Affected Company shall establish a procedure
          whereby no Tainted Director or Executive shall receive confidential
          information of the other Party and its Affiliates but need not place
          any restrictions on confidential or other information of the
          collaboration.

               (iii) In the event of a material violation of this Section 10.5,
          the non- breaching Party may, without resort to the dispute resolution
          procedure set forth in Articles II and XI, bring an immediate court
          action or enjoin such violation and to recover any damages that it may
          have incurred by reasons of such violation.

     10.6. Definitions.
          (a) For purposes of this Agreement, a "Change in Control" of a company
     shall be deemed to have occurred in the event of (i) a merger,
     consolidation, reorganization, recapitalization, the purchase of
     substantially all of the company's assets, or other transaction in which or
     as result of which the common stock of the company, or a successor entity
     having the same ownership as the company, shall cease (except temporarily)
     to be a publicly traded security; or (ii) the acquisition by any
     individual, firm, corporation, or entity (other than any profit sharing or

     other employee benefit plan of the company or any Affiliate, or any
     employee or group of employees or former officers an/or directors of the
     company or its Affiliates) of beneficial ownership, directly or indirectly,
     of securities of the company representing more than **** of the combined
     voting power of the company's then outstanding voting securities.
     Notwithstanding the foregoing, for purposes of this Section 10.6(a), a
     Change in Control shall only be deemed to occur for Procter & Gamble if
     there is a Change in Control of The Procter & Gamble Company or Procter &
     Gamble Pharmaceuticals, Inc.

          (b) A "Substantial Stock Accumulation" of a company shall be deemed to
     have occurred in the event of the accumulation by any individual, firm,
     corporation, or entity (other than any profit sharing or other employee
     benefit plan of the company or any

                                      41


<PAGE>

     Affiliate, or any employee or group of employees or former officers an/or
     directors of the company or its Affiliates) of beneficial ownership,
     directly or indirectly, of securities of the company representing more than
     ***** of the combined voting power of the company's then outstanding voting
     securities.

          (c) Notwithstanding the foregoing in Sections 10.6(a) and (b), Leonard
     Schleifer, M.D., Ph.D., the present President and Chief Executive Officer
     of Regeneron, may increase his percentage of Regeneron's or Regeneron's
     Parent's combined voting power of its outstanding securities and no
     Substantial Stock Accumulation or Change in Control for Regeneron shall be
     deemed to have occurred. For the purposes of this Section 10.6(c), Dr.
     Schleifer's ownership of securities of Regeneron or Regeneron's Parent
     shall be deemed to be his direct or indirect ownership of capital shares or
     options to purchase such capital shares of Regeneron or Regeneron's Parent
     and the direct or indirect ownership of such shares by members of his
     family living in his household to the extent that Dr. Schleifer retains
     voting control, the power to exercise such options, and the right to
     dispose of such shares, and shall not include any other shares over which
     he does not possess Beneficial Ownership, as defined in the Securities and
     Exchange Act of 1934, as amended.

     10.7. License Fee. The "License Fee" for purposes of Sections 10.4 and 10.5
shall be determined as follows:
          (a) License Fee has two components: a Valuation (as defined herein) of
     the Parties' interest in the Agreement or J-V Agreement with respect to
     Compounds to which neither Party has Opted Out in total and a running
     royalty on Net Sales of any Compound for which neither Party has Opted Out,
     such rate and term being calculated as per Section 6.1 ("Running Royalty").
     Each Party shall designate an investment banking firm of its choice, and
     each investment banking firm will be asked to prepare an appraisal as to
     the fair market value of the collaboration as a going concern that would be
     received in cash from a Third Party if a sale of the collaboration were
     made to a Third Party, taking into account any contractual obligation of
     either Party or its Affiliates to refrain from manufacturing or marketing a

     product competitive with the products in the Territory for any period, the
     value of the information, Patents and Know-how, and other assets being
     licensed and the potential market for such Compounds in the Territory
     ("Fair Market Value"). The Fair Market Value shall not include Compounds in
     specific countries or in the entire Territory for which either Party is an
     Opting Out Party, as such royalty shall continue to be governed pursuant to
     Section 6.1, regardless of a Change of Control. *************. The
     investment bankers will be asked to submit their Valuations within

                                      42


<PAGE>

     thirty (30) days after the Purchase Date as defined in Section 10.7(e). In
     the event of a Party's failure to obtain an investment banking firm's
     Valuation within thirty (30) days after the Purchase Date, the Valuation
     will be the Valuation determined by the investment banking firm appointed
     by the other Party. An example of the operation of the License Fee is set
     forth in Attachment 10.7(a).

          (b) If the difference between the lower Valuation and the higher
     Valuation is not more than ***** of the higher Valuation, or if the
     Valuations are equal, the final Valuation shall be the average of the
     Valuations. If the difference between the ***** Valuations is more than
     ***** of the higher Valuation, the investment bankers will select a third
     investment banking firm from those known as major bracket investment
     banking firms, and that firm shall also prepare a Valuation. The third
     investment banking firm will not have access to the Valuations prepared by
     the other investment banking firms. The ***** Valuations that are the
     closest in value then shall be averaged, and the resulting average shall be
     the final Valuation. 

          (c) The purchase of the interest shall thereafter be consummated by
     payment of the Valuation and the obligation to pay the Running Royalty
     within ***** days after receipt of all investment bankers' valuations or
     such later date upon which all necessary regulatory approvals have been
     obtained and/or regulatory waiting periods have expired. 

          (d) The Party that sells its entire interest in the collaboration
     ("Seller") shall grant to the other Party ("Purchaser") an exclusive,
     royalty-free license in the Territory under Seller's Patents and Seller's
     Know-how to make, have made, use, import, offer for sale and sell Lead
     Compounds and Validated Targets and a non-exclusive, royalty-free license
     in the Territory under Seller's Patents and Seller's Know-how to make, have
     made, use, import, offer for sale and sell other Seller's Technology.
     "Seller's Patents," "Seller's Know-how" and "Seller's Technology" shall be
     Procter & Gamble or Regeneron Technology, Patents and Know-how, depending
     upon which Party is Seller. 

          (e) Each Party shall bear the expense of obtaining the Valuation of
     the investment bankers selected by such Party, and if a third investment
     banker is selected, the expense of obtaining its Valuation shall be borne
     equally by the Parties.


          (f) Unless otherwise agreed in writing by the Parties, the License Fee
     for a license under Sections 10.4, 10.5 and 10.6 shall be calculated as of
     the date of the Electing Company's notice that it elects to exercise the
     Option under Sections 10.4 or 10.5 or the Purchasing Company's notice that
     it desires to license the interest of the Party affiliated with the
     Affected Company under Section 10.4 (such date shall be referred to as the
     "Purchase Date").

                                      43


<PAGE>


          (g) During the pendency of the Option election and valuation process
     and any time period when the Parties are attempting to sell their interest
     to a Third Party pursuant to Section 10.4(a)(i), the Parties shall continue
     to perform their customary activities under this Agreement or any J-V
     Agreement.

          (h) Seller and Purchaser shall cooperate with each other in good 
     faith to facilitate the transfer of the Seller's interest in the
     collaboration, including transferring Information relating to the
     collaboration to Purchaser, so as to minimize disruption to the business.
     As used in this Section, "Information" means any confidential information
     and trade secrets, including but not limited to information relating to
     inventions, disclosures, processes, systems, Know-how, methods, techniques,
     formulations, drawings, patents, patent applications, sales and marketing
     information, materials, services, research and development activities and
     plans, clinical studies, manufacturing information and regulatory filings.


                         Article XI - Miscellaneous
                         --------------------------
     11.1. Force Majeure. Neither Party shall lose any rights hereunder or be
     liable to the other Party for damages or loss on account of failure of
     performance by the Defaulting Party if the failure is occasioned by
     government action, war, fire, explosion, flood, strike, lockout, embargo,
     act of God, or any other similar cause beyond the reasonable control of the
     Defaulting Party, provided that the Party claiming force majeure has
     exerted all reasonable efforts to avoid or remedy such force majeure and
     given prompt notice to the other Party.

     11.2. Notices. Any notices or communications provided for in this Agreement
     to be made by either of the Parties to the other shall be in writing, in
     English, and shall be made by prepaid air mail with return receipt
     addressed to the other at its address set forth above. Any such notice or
     communication may also be given by hand or facsimile to the appropriate
     designation with confirmation of receipt. Either Party may by like notice
     specify an address to which notices and communications shall thereafter be
     sent. Notices sent by mail shall be effective upon receipt; notices given
     by hand shall be effective when delivered.

          Notices for Regeneron shall be sent to:
          

          Regeneron Pharmaceuticals, Inc.
          Attn:  Corporate Secretary
          777 Old Saw Mill River Road

                                      44


<PAGE>

          Tarrytown, New York  10591-6707

     With copy to:

          Regeneron Pharmaceuticals, Inc.
          Attn:  General Counsel
          777 Old Saw Mill River Road
          Tarrytown, New York  10591-6707

     Notices for Procter & Gamble shall be sent to:

          Procter & Gamble Pharmaceuticals, Inc.
          Attn:  President
          One Procter & Gamble Plaza
          Cincinnati, Ohio  45202
     
     With copy to:

          Procter & Gamble Pharmaceuticals, Inc.
          Attn:  Associate General Counsel-Patents
          Health Care Research Center
          8700 Mason-Montgomery Road
          Mason, Ohio 45040

     11.3. Governing Law. This Agreement shall be governed by the laws of the
State of Delaware, as such laws are applied to contracts entered into and to be
performed within such state. Any claim or controversy arising out of or related
to this Agreement or any breach hereof shall be submitted to arbitration
pursuant to Section 11.4. The United Nations Convention on Contracts for the
International Sale of Goods will not apply to this Agreement.

     11.4. Arbitration. Subject to Sections 2.5 and 10.5, disagreements under
this Agreement shall be settled by arbitration in accordance with the commercial
arbitration rules of the American Arbitration Association. The parties further
agree that each such disagreement be submitted to a panel of three (3) impartial
arbitrators with each Party selecting one (1) arbitrator within fifteen (15)
days of a request for arbitration and the two (2) selected arbitrators selecting
a third arbitrator who is experienced in the United States pharmaceutical
industry within thirty (30) days after the request. Any arbitration hereunder
shall commence within thirty (30) days after appointment of the third arbitrator
and shall be held in Boston, Mass., U.S.A. Upon reasonable

                                      45


<PAGE>


notice and prior to any hearing, the Parties will allow document discovery and
will disclose all materials relevant to the subject matter of the dispute. The
arbitrators shall make final determinations as to any discovery disputes. The
decision of the arbitrators shall be rendered no later than sixty (60) days
after commencement of arbitration. The costs of arbitration shall be split by
the parties unless the arbitrators decide otherwise. Any judgment or decision
rendered by the panel shall be binding upon the Parties and shall be enforceable
by any court of competent jurisdiction.

     11.5. Non-waiver of Rights. Except as specifically provided for herein, the
waiver from time to time by any of the parties of any of their rights or their
failure to exercise any remedy shall not operate or be construed as a continuing
waiver of same or of any other of such Party's rights or remedies provided in
this Agreement.

     11.6. Severability. If any term, covenant, or condition of this Agreement
or the application thereof to any Party or circumstance shall, to any extent, be
held to be invalid or unenforceable, then (i) the remainder of this Agreement,
or the application of such term, covenant or condition to Parties or
circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby and each term, covenant, or condition of this
Agreement shall be valid and be enforced to the fullest extent permitted by law
and (ii) the Parties hereto covenant and agree to renegotiate any such term,
covenant, or application thereof in good faith in order to provide a reasonably
acceptable alternative to the term, covenant, or condition of this Agreement or
the application thereof that is invalid or unenforceable, and in the event that
the Parties are unable to agree upon a reasonably acceptable alternative, then
the Parties agree that a submission to arbitration shall be made in accordance
with Section 11.4 to establish an alternative to such invalid or unenforceable
term, covenant, or condition of this Agreement or the application thereof, it
being the intent that the basic purposes of this Agreement are to be
effectuated.

     11.7. Entire Agreement. This Agreement sets forth all the covenants,
promises, agreements, warranties, representations, conditions, and
understandings between the Parties hereto in the scope of the Collaboration ,
with the exception of any agreements by the Parties executed at an even date
hereof, and supersedes and terminates all prior agreements and understanding
between the parties under this Agreement. No subsequent alteration, amendment,
change, or addition to this Agreement shall be binding upon the Parties hereto
unless reduced to writing and signed by the respective authorized officers of
the Parties.

                                      46


<PAGE>

     11.8. Survival.  Sections 5.3, 5.4, 5.5 and 8.1 shall survive the
termination of this Agreement for to the extent specified therein.  Section 9.3
and any accrued obligations under this Agreement shall survive termination of
this Agreement without limit as to time.

     11.9. Assignment.


          (a) Procter & Gamble and Regeneron may assign any of their rights or
     obligations under this Agreement in any country of the Territory to any
     Affiliates; provided, however, that such assignment shall not relieve the
     assigning Party of its responsibility for performance of its obligations
     under this Agreement.

          (b) The Parties recognize that each may perform some of its
     obligations hereunder through Affiliates; provided, however, that Procter &
     Gamble and Regeneron shall remain responsible and be guarantors of such
     performance by their Affiliates and shall cause their Affiliates to comply
     with the provisions of this Agreement in connection with such performance.

          (c) Procter & Gamble and Regeneron may only assign their rights under
     this Agreement in any country of the Territory to a Third Party with
     written permission of the other Party, which permission will only be given
     at its sole discretion.

     11.10. Publicity.

          (a) Procter & Gamble and Regeneron will jointly discuss, based on the
     principles of Section 11.10(b), any press releases and any other public
     statements regarding the execution and the subject matter of this
     Agreement, the research to be conducted under this Agreement or any other
     aspect of this Agreement, subject in each case to disclosure otherwise
     required by law or regulation.

          (b) In the discussion and agreement of Section 11.10(a), the
     principles observed by Procter & Gamble and Regeneron will be accuracy, the
     requirements for confidentiality under Article IX, the advantage a
     competitor of Procter & Gamble or Regeneron may gain from any statement
     under Section 11.10(a), the requirements of disclosure under any securities
     laws or regulations of the United States, including those associated with
     SEC and regulatory filings and public offerings, the restrictions imposed
     by the Federal Food, Drug and Cosmetic Act, and the standards and customs
     in the pharmaceutical industry for such disclosures by companies comparable
     to Procter & Gamble and Regeneron.


                                      47


<PAGE>


     11.11. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one in the same instrument.

     11.12. No Solicitation. During the Term of this Agreement, the Parties
shall not directly or indirectly solicit the other Party's employees for
employment or other consulting arrangements.

                                      48


<PAGE>

                           Article XII - Execution
                           -----------------------

     12.1. In witness whereof the Parties have executed this Agreement in
duplicate originals by their proper officers as of the date and year first
written above.

The Procter & Gamble Company


By:  ________________________________
     G. Gilbert Cloyd
     Vice President - Pharmaceuticals



Regeneron Pharmaceuticals, Inc.

By:  ________________________________
     Leonard S. Schleifer, M.D., Ph.D.
     President and Chief Executive Officer


                                      49


<PAGE>

               Attachment 1.13(a)Regeneron Excluded Technology

BDNF, NT-3, AXOKINE, CNTF, small molecule agonists or antagonists of
neurotrophic factors as defined in the Field in the Glaxo/Regeneron
collaboration, small molecule agonsits and antagonists of cytokines and growth
factors as defined in the Field in the Pharmacopeia/Regeneron collaboration
agreement, and protein-based cytokine agonists and antagonist of the compounds
in the definition of the Field in the Pharmacopeia/Regeneron collaboration.

                                      50


<PAGE>

                              Attachment 2.2(a)

                 Initial Members of the Operating Committee


From Regeneron:
- --------------

     Leonard S. Schleifer, M.D., Ph.D.
     President and Chief Executive Officer

From Procter & Gamble:
- ---------------------

     Gordon Hassing, Ph.D.
     Vice President

                                      51


<PAGE>

                              Attachment 2.2(b)

                   Initial Members of the Program Committee

From Regeneron:
- ---------------

     George Yancopoulos, Ph.D.

From Procter & Gamble:
- ----------------------

     Nancy K. Eddy, Ph.D.


                                      52


<PAGE>

                                Attachment 3.1

        Timing and Calculation of Research and/or Product Plan Budgets

Budget Process

1)   Budget Preparation
     ------------------

     o    *****
     o    *****
     o    *****
     o    *****
     o    *****

2)   Budget Preparation and Approval Cycle Timing
     --------------------------------------------

     o    *****
     o    *****
     o    *****
     o    *****

3)   Budget Monitoring
     -----------------

     o    *****
     o    *****
     o    *****
     o    *****

                                      53


<PAGE>

                         Attachment 3.1 ("continued")

Budget Cost Development

1)   Internal Costs
     --------------
     o    *****
     o    *****

                         Attachment 3.1 ("continued")

          *****


2)   Third Party costs

     o    *****


                                      54

<PAGE>

                             Attachment 3.2(d)(1)

                        Research Payments to Regeneron

   Fiscal Quarter     Total Payments(1) ($000)
   --------------     ------------------------
   AMJ  1997         ***
   JAS  1997      ***
   OND  1997      ***
   JFM  1998      ***
   AMJ  1998      ***
   JAS  1998       ***
   OND  1998                  ***
   JFM  1999                  ***
   AMJ  1999                  ***
   JAS  1999                  ***
   OND  1999                  ***
   JFM  2000                  ***
   AMJ  2000                  ***
   JAS  2000                  ***
   OND  2000                  ***
   JFM  2001                  ***
   AMJ  2001                  ***
   JAS  2001                  ***
   OND  2001                  ***
   JFM  2002                  ***
   AMJ  2002                  ***
   
- -------------------
(1) Excludes Inflation Adjustment Payments and any Allowable Research Expenses.
* If Procter and Gamble chooses to fund an additional *** Regeneron FTEs during
the Option Period pursuant to Section 3.2(a), this amount shall be increases
***** per quarter.

                                      55


<PAGE>
                             Attachment 3.2(d)(2)

                         Inflation Payment Adjustment

                  Fiscal Quarter           Regeneron FTEs(2)
                  --------------           -----------------

                  JAS  1998                     ***
                  OND  1998                     ***
                  JFM  1999                     ***
                  AMJ  1999                     ***
                  JAS  1999                     ***
                  OND  1999                     ***
                  JFM  2000                     ***
                  AMJ  2000                     ***
                  JAS  2000                     ***
                  OND  2000                     ***
                  JFM  2001                     ***
                  AMJ  2001                     ***
                  JAS  2001                     ***
                  OND  2001                     ***
                  JFM  2001                     ***               
                  AMJ  2002                     ***
                  JAS  2002 to the end of       As agreed per the Research
                       the Research Term        Collaboration Plan, but no
                                                less than ***

Example:
- --------

                       June 1997 US CPI Value   157.0
                       June 1998 US CPI Value   161.6
                       June 1999 US CPI Value   166.1

         FY 1998/99 Inflation Factor = (161.6 - 157.0) / 157.0 = 2.9%
         FY 1999/00 Inflation Factor = (166.1 - 157.0) / 157.0 = 5.8%

     Quarterly Inflation Payment Adjustment = (*****) x #FTEs x % change

Therefore:
- ----------

                OND 1998 Inflation Payment Adjustment = ******
                OND 1999 Inflation Payment Adjustment = ******

- -------------------
* This amount shall bew increased by *****, if Procter & Gamble chooses to fund
the ***** additional Regeneron FTEs pursuant to Section 3.2(a).


<PAGE>
                             Attachment 3.2(d)(3)

             Expenses Included in the Regeneron Research FTE Rate

o  Payroll expense, including salaries, bonuses, commission, employee benefits
   and employee-paid payroll taxes

o    Employee training and education

o    Administrative support

o    *****


o    *****


o    *****


o    *****


o    *****


o    *****


o    *****


o    *****


o    *****

                                      3


<PAGE>
                              Attachment 6.1(b)

               Each Party's Share of Royalties or Other Income

                          When Both Parties Opt Out


<TABLE>
<CAPTION>
Party A's         Party A's Share   Party B's         Party B's   
Royalty Rate as   of Royalties or   Royalty Rate as   Share of    
an Opting Out     Other Income      an Opting Out     Royalties or
Party                               Party             Other Income
<S>             <C>               <C>               <C>         <C>               <C>             <C>

Example            ***%               ***            ***%           ***%             ***            ***%
    1

Example            ***%               ***            ***%           ***%             ***            ***%
    2

Example            ***%               ***            ***%           ***%             ***            ***%
    3
</TABLE>


                                      4



<PAGE>

                              Attachment 9.1(b)

            Third Party Agreements Relating to Excluded Technology

Technology Development Agreement dated as of March 20, 1989, between Sumitomo
Chemical Company, Limited and Regeneron Pharmaceuticals, Inc.

Collaboration Agreement dated as of August 31, 1990, between Amgen Inc. and
Regeneron Pharmaceuticals, Inc.

Collaboration Agreement dated as of July 22, 1993, between Glaxo Group Limited
and Regeneron Pharmaceuticals, Inc.

Research Development Agreement dated as of June 2, 1994, between Sumitomo
Pharmaceuticals Company, Ltd., and Regeneron Pharmaceuticals, Inc.

Collaboration Agreement dated as of October 9, 1996, between Pharmacopeia, Inc.,
and Regeneron Pharmaceuticals, Inc.


                                      5


<PAGE>

                              Attachment 10.3(b)

                           Regeneron Key Executives



                                    *****


                                      6




<PAGE>
                              Attachment 10.7(a)

                       Example of License Fee Operation

                   Scenario             License Fee Operation

1.   Party A is Opting Out Party with respect   No License Fee; Party B         
     to all Compounds in all countries.         continues to pay royalties for  
                                                Royalty Term pursuant to Section
     Subsequently, Party A becomes Acquired     6.1
     Company; Party B elects Option. 

2.   Party A is Opting Out Party with respect   No License Fee on the ***** of  
     to  ***  of a total of  ***  in all        which Party A Opted Out; Party B
     countries.                                 continues to pay royalties on   
                                                ***** for the Royalty Term      
     Subsequently, Party A becomes Acquired     pursuant to Section 6.1.        
     Company; Party B elects Option while       
     ***** is a Research Compound and ***** is  
     in Phase II studies.                       For *****, the investment       
                                                bankers shall prepare a Fair    
                                                Market Value of such Compounds  
                                                and subtract out the net present
                                                value of the Running Royalty for
                                                ***** and ***** from ***** of   
                                                the Fair Market Value to        
                                                calculate the Valuation. Party B
                                                shall have the obligation to pay
                                                the Running Royalty on *****.   

                                      7


<PAGE>

3.   Party A has not Opted Out with respect to  For all Compounds, the          
     any of the ***** in research, development  investment bankers shall prepare
     and commercialization. *****.              a Fair Market Value of such     
                                                Compounds in the Territory and  
                                                subtract out the net present    
                                                value of the Running Royalty for
                                                ***** and ***** from ***** of   
                                                the Fair Market Value to        
                                                calculate the Valuation. Party B
                                                shall have the obligation to pay
                                                the Running Royalty on *****.   



                                      8




<PAGE>
                                                                    Exhibit 11
                                                                  --------------

                         REGENERON PHARMACEUTICALS, INC.
                 STATEMENT OF COMPUTATION OF NET LOSS PER SHARE


<TABLE>
<CAPTION>
                                                     Three months ended June 30,       Six months ended June 30,
                                                     ----------------------------    ----------------------------
                                                         1997            1996            1997             1996
                                                     ------------    ------------    ------------    ------------
<S>                                                  <C>             <C>             <C>             <C>

Primary:

Net loss                                              ($4,269,667)    ($7,624,633)   ($10,198,516)   ($15,392,131)
                                                     ============    ============    ============    ============

Per share data
    Weighted average number of Class A and
       Common shares outstanding during the period     27,192,724      24,585,518      26,495,847      23,296,691
                                                     ============    ============    ============    ============

       Net loss per share                                  ($0.16)         ($0.31)         ($0.38)         ($0.66)
                                                     ============    ============    ============    ============

Fully diluted:

Net loss                                              ($4,269,667)    ($7,624,633)   ($10,198,516)   ($15,392,131)
                                                     ============    ============    ============    ============

Per share data
    Weighted average number of Class A and
       Common shares outstanding during
       the period                                      27,192,724      24,585,518      26,495,847      23,296,691

    Shares issuable upon exercise of options
       and warrants                                     2,539,942       3,607,408       2,360,094       3,336,165

    Shares assumed to be repurchased under
       the treasury stock method                       (1,454,176)     (1,776,186)     (1,272,702)     (1,507,453)
                                                     ------------    ------------    ------------    ------------

                                                       28,278,490      26,416,740      27,583,239      25,125,403
                                                     ============    ============    ============    ============

       Net loss per share                                  ($0.15)         ($0.29)         ($0.37)         ($0.61)
                                                     ============    ============    ============    ============
</TABLE>






<TABLE> <S> <C>


<ARTICLE> 5
       
<S>                           <C>
<PERIOD-TYPE>                 6-MOS
<FISCAL-YEAR-END>             DEC-31-1997
<PERIOD-START>                JAN-01-1997
<PERIOD-END>                  JUN-30-1997
<CASH>                        51,445,161
<SECURITIES>                  78,054,738
<RECEIVABLES>                 5,984,638
<ALLOWANCES>                  0
<INVENTORY>                   0
<CURRENT-ASSETS>              394,763
<PP&E>                        55,543,850
<DEPRECIATION>                21,570,286
<TOTAL-ASSETS>                169,953,873
<CURRENT-LIABILITIES>         10,848,064
<BONDS>                       0
<PREFERRED-MANDATORY>         0
<PREFERRED>                   0
<COMMON>                      4,280
<OTHER-SE>                    139,944,101
<TOTAL-LIABILITY-AND-EQUITY>  169,953,873
<SALES>                       0
<TOTAL-REVENUES>              12,829,897
<CGS>                         0
<TOTAL-COSTS>                 0
<OTHER-EXPENSES>              22,623,372
<LOSS-PROVISION>              0
<INTEREST-EXPENSE>            405,051
<INCOME-PRETAX>               (10,198,526)
<INCOME-TAX>                  0
<INCOME-CONTINUING>           (10,198,526)
<DISCONTINUED>                0
<EXTRAORDINARY>               0
<CHANGES>                     0
<NET-INCOME>                  (10,198,526)
<EPS-PRIMARY>                 (0.38)
<EPS-DILUTED>                 (0.37)
        


</TABLE>