SECURITIES AND EXCHANGE COMMISSION


                             Washington, D.C. 20549


                                 _______________

   
                                    FORM 8-K/A

                                 AMENDMENT NO.1 
    
                                 CURRENT REPORT


                     Pursuant to Section 13 or 15(d) of the


                         Securities Exchange Act of 1934



Date of Report (Date of earliest event reported)  May 3, 1996                   
                                                 -------------------------------



                         BioCryst Pharmaceuticals, Inc.                         
- --------------------------------------------------------------------------------
               (Exact name of registrant as specified in charter)



     Delaware                       000-23186                      62-1413174   
- --------------------------------------------------------------------------------
(State or other jurisdiction       (Commission                   (IRS Employer  
   of incorporation)              File Number)               Identification No.)



  2190 Parkway Lake Drive, Birmingham, Alabama                          35244   
- --------------------------------------------------------------------------------
(Address of principal executive offices)                              (Zip Code)


Registrant's telephone number, including area code     (205) 444-4600           
                                                    ----------------------------

                                      N.A.                                      
- --------------------------------------------------------------------------------
         (Former name or former address, if changed since last report.)




Item 5.   Other Events
- ------    ------------

          See attached press releases.

          These press releases contain projections or other forward-looking
          statements regarding future events or the future financial performance
          of the Company.  These statements are only predictions and the actual
          events or results may differ materially.  Please refer to the
          documents the Company files from time to time with the Securities and
          Exchange Commission, specifically the Company's most recent Form 10-K
          and Form 10-Q.  These documents contain and identify important factors
          that could cause the actual results to differ materially from those
          contained in the projections or forward-looking statements.


Item 7.   Exhibits
- ------    --------
   
          10.1+     License Agreement, dated May 31, 1996, between Registrant 
                    and Torii Pharmaceuticals Co., Ltd. ("Torii").

          10.2+     Stock Purchase Agreement, dated May 31, 1996, between 
                    Registrant and Torii.
    
_________________
+    Confidential Treatment Requested



                                   SIGNATURES



          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 hereunto duly authorized.

                              BioCryst Pharmaceuticals, Inc.
                              (Registrant)



                              By:     /s/ Ronald E. Gray                       
                                    --------------------------------------------
                              Name:  Ronald E. Gray
                              Title: Chief Financial Officer


Dated: July 26, 1996



BIOCRYST PHARMACEUTICALS, INC.
2190 PARKWAY LAKE DRIVE
BIRMINGHAM, AL  35244
205-444-4600
205-444-4640 (FAX)


Contact:
BioCryst Pharmaceuticals, Inc.
John L. Higgins                    Burns McClellan, Inc.
Vice President, Corporate          James W. Heins (Media)
  Development                      Jonathan M. Nugent (Investors)
(205) 444-4600                     (212) 505-1919


FOR IMMEDIATE RELEASE
- ---------------------


             BioCryst Reports Encouraging Preliminary Results from a
                  Phase II Trial of its Lead Compound, BCX-34,
                       for Topical Treatments of Psoriasis

Birmingham, AL -- May 3, 1996 -- BioCryst Pharmaceuticals, Inc. (Nasdaq NM:
BCRX) today announced encouraging preliminary results from a Phase II trial of
its lead compound, BCX-34, for the topical treatment of psoriasis.  The Phase II
double-blind, placebo-controlled trial treated 90 patients with plaque psoriasis
for three months with a topical cream containing one-percent drug concentration
of BCX-34.  The endpoints for the trial were reductions in erythema, scaling and
thickness of plaques, which were combined for a total score, and a global
physician assessment.  The trial had two parallel patient groups, one receiving
drug and the other receiving placebo.  The preliminary data from this trial will
be summarized in conjunction with previous Phase II clinical trial data at the
57th Annual Meeting of the Society for Investigative Dermatology being held May
1-4 in Washington, D.C.

The trial was conducted at four geographically diverse sites:  two in northern
climates and two in the Sunbelt.  Analysis of the combined data from all sites
did not reveal a clear drug effect different from placebo; however, there was a
statistically significant difference in the data from the northern and Sunbelt
patient groups which did not allow for a meaningful comparative analysis of the
combined data from all sites.  Consequently, the two regions were analyzed
separately.  Data from the northern sites showed a statistically significant
outcome for the total clinical score and the global physician assessment after
12 weeks of treatment.  In the Sunbelt sites, there was a large response in
placebo-treated patients, which masked any apparent drug effect.  The difference
in placebo responses between the sites in the north and the sites in the Sunbelt
is believed by the Company to have been caused by the phototherapeutic effect of
the sun in southern climates.  There were no significant adverse events reported
at any of the four sites.







BioCryst Pharmaceuticals, Inc.
Page 2



"Data from the northern sites support the clinical efficacy of BCX-34 for the
topical treatment of psoriasis," said George A. Omura, M.D., Vice President,
Clinical Development of BioCryst.  "The elevated placebo response in the Sunbelt
sites, in our opinion, is attributable to increased exposure to the warmer
climate and sunlight, which has a well-known therapeutic effect on skin
conditions such as psoriasis."

"We have gained valuable clinical data from these trials and are satisfied that
the results warrant advancing BCX-34 to the next stage of development," said
Charles E. Bugg, Ph.D., President and Chief Executive Officer of BioCryst.  "We
will request a meeting with the FDA to discuss the design and initiation of
Phase III trials.  These next trials will be designed to compensate for
phototherapeutic and other non-drug related effects, and give a definitive
assessment of the drug's efficacy and safety."

Psoriasis is a chronic and recurrent disease characterized by red, thick scaling
or welt-covered portions of the skin.  An estimated five million people in the
United States are affected by psoriasis.  Current therapies for psoriasis are
not optimal or are associated with side effects.

The Company is currently conducting a multi-center Phase III clinical trial with
topical BCX-34 for the treatment of cutaneous T-cell lymphoma (CTCL) and a Phase
I/II clinical trial with an oral formulation of BCX-34 to treat T-cell cancers. 
These diseases and others, including rheumatoid arthritis, multiple sclerosis
and psoriasis, are associated with the proliferation of T-cells.  Based upon the
results of the ongoing Phase I/II oral trial, BioCryst plans to initiate oral
trials for additional indications including the treatment of psoriasis.  BCX-34
is a potent, small-molecule inhibitor of purine nucleoside phosphorylase (PNP),
a human enzyme that plays a central role in the proliferation of T-cells.  BCX-
34 was granted Orphan Drug Status in October 1993 for CTCL and qualifies for
accelerated review as a new drug to treat serious and life-threatening
illnesses.

Except for the descriptions of historical facts contained herein, this news
release contains forward-looking statements that involve risks and uncertainties
as detailed from time to time in BioCryst's SEC filings under the Securities Act
of 1933 and the Securities Exchange Act of 1934, including, among other things,
uncertainties as to the clinical and commercial success of BCX-34, and
competitive, patent, regulatory and product liability issues.  The trial
outcomes discussed in this press release are not necessarily predictive of the
results of future trials.

Founded in 1986, BioCryst Pharmaceuticals, Inc. designs and develops novel,
small molecule pharmaceuticals using structure-based drug design, an approach to
drug discovery that integrates advanced biology, biophysics and medicinal
chemistry.  BioCryst's lead drug, BCX-34, is in clinical trials with both
topical and oral formulations.  The Company is developing drug treatments for
immunological and infectious diseases.


                                       ###




BIOCRYST PHARMACEUTICALS, INC.
2190 PARKWAY LAKE DRIVE
BIRMINGHAM, AL  35244
205-444-4600
205-444-4640 (FAX)


Contact:
BioCryst Pharmaceuticals, Inc.
John L. Higgins                    Burns McClellan, Inc.
Vice President, Corporate          James W. Heins (Media)
  Development                      Jonathan M. Nugent (Investors)
(205) 444-4600                     (212) 505-1919


FOR IMMEDIATE RELEASE
- ---------------------


         BioCryst Enters License Agreement with Japanese Pharmaceutical
                          Company for Lead Drug Program


Birmingham, AL -- June 3, 1996 -- BioCryst Pharmaceuticals, Inc. (Nasdaq NM:
BCRX) announced today that it has entered into an exclusive license agreement
with Torii Pharmaceutical Co., Ltd. of Japan for the development, manufacture
and commercialization of certain of its purine nucleoside phosphorylase (PNP)
inhibitors in Japan.  Under the license agreement, Torii will focus on the
development and commercialization of BioCryst's lead drug, BCX-34, for three
indications, including rheumatoid arthritis, T-cell cancers and atopic
dermatitis.

Under the terms of the agreement, Torii will pay a total of $22 million in
license fees, an equity investment and milestone payments.  Torii will also be
responsible for all development and commercialization expenses in Japan and will
pay royalties on sales of licensed products.  Pursuant to the agreement, Torii
has paid BioCryst $3.0 million upfront, consisting of a $1.5 million license fee
and a $1.5 million equity investment for the purchase of 76,608 shares of common
stock at a price of $19.58 per share.  In addition to the upfront payments,
Torii will pay the remaining $19 million in development milestone payments over
a number of years.  Torii will focus its development efforts on three
indications and can negotiate additional payments with BioCryst to develop PNP
inhibitors for other indications.

"Considering Torii's experience in developing and commercializing major
pharmaceutical products for multiple indications, we believe they are an ideal
partner to assist with the commercialization of BCX-34 in Japan.  Torii shares
our excitement and vision for the potential of our PNP program," said Charles E.
Bugg, Ph.D., President and CEO of BioCryst.  "Given our recent clinical
progress, we are eager to work with our new partner to initiate clinical
development in a major foreign market."




BioCryst Pharmaceuticals, Inc.
Page 2



"One of BioCryst's strategic goals for 1996 was to enter a license agreement in
Japan to initiate clinical development.  As our first major collaboration, our
deal with Torii provides an endorsement of our PNP program and significant
revenue potential with future milestone and royalty payments," said John L.
Higgins, Vice President, Corporate Development.  "Throughout the negotiating
process, we built a strong working relationship with Torii.  We are very
impressed with the company and their experience developing novel therapeutics."

Torii, founded in 1872, focuses its operations primarily on ethical drugs and
has been marketing highly novel drugs in several specialized areas.  The company
was responsible for launching the first cephalosporin antibiotic in Japan in
1965 when it introduced the Glaxo-developed drug Ceporan.  Its leading product,
Futhan, a protease inhibitor developed in-house for the treatment of acute
pancreatitis, is the market leader in its category with 41 percent of the market
in 1995.  The company recently invested US$100 million in a new R&D center.

Torii, which until 1988 was majority-owned by Merck and Co. Ltd., is now
controlled by Asahi Breweries Ltd., Japan's second largest brewing company.  In
October 1993, Torii gained a separate listing on the Tokyo Stock Exchange.  In
the year ended March 31, 1995, Torii had net sales of US$407 million, placing it
in the top 100 pharmaceutical companies worldwide based on sales.

BioCryst is currently conducting a multi-center Phase III clinical trial with
topical BCX-34 for the treatment of cutaneous T-cell lymphoma (CTCL) and a Phase
I/II clinical trial with an oral formulation of BCX-34 to treat T-cell cancers. 
These diseases and others, including rheumatoid arthritis, multiple sclerosis,
psoriasis and atopic dermatitis, are associated with the proliferation of T-
cells.  Depending upon the results of the ongoing Phase I/II oral trial,
BioCryst plans to initiate oral trials for additional indications including the
treatment of psoriasis and rheumatoid arthritis.  BCX-34 is a potent, small-
molecule inhibitor of purine nucleoside phosphorylase (PNP), a human enzyme that
plays a central role in the proliferation of T-cells.  BCX-34 was granted Orphan
Drug Status in October 1993 for CTCL and may qualify for accelerated review as a
new drug to treat serious and life-threatening illnesses.

Founded in 1986, BioCryst Pharmaceuticals, Inc. designs and develops novel,
small-molecule pharmaceuticals using structure-based drug design, an approach to
drug discovery that integrates advanced biology, biophysics and medicinal
chemistry.  BioCryst's lead drug, BCX-34, is in clinical trials with both
topical and oral formulations.  The Company is developing drug treatments for
immunological and infectious diseases.

This press release contains projections or other forward-looking statements
regarding future events or the future financial performance of the Company. 
These statements are only predictions and the actual events or results may
differ materially.  Please refer to the documents the company files from time to
time with the Securities and Exchange 




BioCryst Pharmaceuticals, Inc.
Page 3



Commission, specifically the Company's most recent Form 10-K and Form 10-Q. 
These documents contain and identify important factors that could cause the
actual results to differ materially from those contained in the projections or
forward-looking statements.


                                       ###




   
                                  Exhibit 10.1

                                LICENSE AGREEMENT
    



          This License Agreement (the "Agreement") is entered into as of the
31st day of May, 1996 (the "Effective Date") between TORII PHARMACEUTICAL CO.,
LTD., a Japanese corporation having a principal place of business at 3-4-1,
Nihonbashi-Honcho, Chuo-ku, Tokyo 103, Japan ("Licensee") and BIOCRYST
PHARMACEUTICALS, INC., a Delaware corporation having a principal place of
business at 2190 Parkway Lake Drive, Birmingham, Alabama 35244, U.S.A.
("Licensor").

          WHEREAS, Licensor is using structure-based drug design to discover and
design novel, small-molecule pharmaceutical products for the treatment of
immunological and infectious diseases and disorders, and has designed and
synthesized certain distinct classes of chemical compounds which inhibit the
enzyme Purine Nucleoside Phosphorylase ("PNP"), which is believed to be involved
in T-cell proliferation;

          WHEREAS, Licensor has invested substantial financial resources into
its research and development efforts, has made certain valuable discoveries and
inventions as part of its research and development, holds certain valuable
technologies, patent applications, patents and trade secrets and is conducting
certain clinical trials in relation to its lead pharmaceutical product BCX-34 in
the United States;

          WHEREAS, Licensee is a Japanese pharmaceutical company that possesses
resources of a financial and technical nature, capabilities and expertise in
small-molecule pharmaceutical design and development, and capabilities and
expertise in regulatory matters, sales and marketing in Japan;

          WHEREAS, Licensee desires to obtain from Licensor an exclusive license
for Japan in respect of Licensor's BCX-34 product and certain related compounds,
inventions, technologies and clinical trial data, and Licensor is willing to
grant such a license to Licensee on the terms and conditions set forth in this
Agreement.

          NOW, THEREFORE, in consideration of the foregoing premises and the
following mutual covenants, and other good and valuable consideration, the
receipt of which is hereby acknowledged, and intending to be legally bound
hereby, the parties agree as follows:

          1.   Certain Definitions.
               -------------------

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









          1.1  "Additional Indication" shall mean any indication for a Licensed
Product other than an indication that is a Primary Indication.

          1.2  "Affiliate" shall mean an entity directly or indirectly
controlling, controlled by or under common control with a party, where control
means the ownership or control, directly or indirectly, of more than fifty
percent (50%) of all of the voting power of the shares (or other securities or
rights) entitled to vote for the election of directors or other governing
authority, as of the Effective Date or hereafter during the Term of this
Agreement; provided that such entity shall be considered an Affiliate only for
the time during which such control exists.

          1.3  "Arbitration" shall mean arbitration as described in Section 15
hereof.

          1.4  "BCX-34" shall mean 2-amino-1, 5-dihydro-7-(3-pyridinylmethyl)-
               4H-pyrrolo[3,2-d]pyrimidin-4-one.

          1.5  "Derivative Compound" shall mean any compound which is derived
from a Licensed Compound.  It is understood that "Derivative Compound" shall
include compounds derived from a Licensed Compound or derived from another
Derivative Compound.

          1.6  "Disclosing Party" shall mean a party hereto that discloses its
Proprietary Information to the other party.

          1.7  "FDA" shall mean the U.S. Food and Drug Administration or any
corresponding foreign registration or regulatory authority.

          1.8  "Field" shall mean the therapeutic or prophylactic treatment or
prevention of diseases and conditions in humans and animals, or diagnosis
thereof, through the use of a Licensed Compound, Derivative Compound and/or
Licensed Product.

          1.9  "Improvement" shall mean any invention (whether or not
patentable), idea, process, formula, know-how, or Derivative Compound, that
enhances the effectiveness of or is an improvement upon any aspect of a Licensed
Compound or a Licensed Product, which is made by either or both of the parties
hereto during the Term of this Agreement.  Licensor Improvement, Licensee
Improvement and Joint Improvement shall each have the meaning ascribed to such
terms in Section 14 hereof.

          1.10 "IND" shall mean an Investigational New Drug application, as
defined in the U.S. Food, Drug and Cosmetic Act and the regulations promulgated
thereunder for initiating clinical trials in the United States, or any
corresponding foreign application, registration or certification.




                                        2




          1.11 "Licensed Compound" shall mean any compound, including but not
limited to BCX-34, claimed in Patent Cooperation Treaty application no. [ * ] or
Japanese patent application serial no. [ * ], except for those compounds which,
as of the Effective Date, are subject to an existing license granted by Licensor
in favor of a third party, as set forth on Exhibit A attached to this Agreement.
                                           ---------

          1.12 "Licensed Product" shall mean any product containing a Licensed
Compound or a Derivative Compound, including without limitation, BCX-34.

          1.13 "NDA" shall mean a New Drug Application, as defined in the U.S.
Food, Drug and Cosmetic Act and the regulations promulgated thereunder, or any
corresponding foreign application, registration or certification.

          1.14 "Net Sales" of a Licensed Product shall mean revenues actually
received from the sale, use or other disposition of that Licensed Product in
each case less any allowances actually made and taken for returns; shipping and
          ----
insurance costs actually paid (and not reimbursed); cash discounts actually
allowed in amounts and for purposes customary in the trade; sales, use, value-
added and similar taxes and duties and similar governmental assessments (on
Licensed Products as shipped) actually paid (and not reimbursed).  If a Licensed
Product is distributed for use in combination with or as a component of other
products, the Net Sales for purposes of royalty payments will be calculated by
multiplying the Net Sales of the combination by the fraction A/(A+B), where A is
the retail price specified in the party's published retail price list as of the
end of the applicable period ("Retail Price") for the amount of the Licensed
Product used in the combination when distributed separately and B is the Retail
Price for the other product or components used in the combination when
distributed separately; provided, however, that if the Licensed Products and/or
the other products in the combination are not distributed separately, the
calculation of the Net Sales for purposes of royalty payments shall be as
determined (i) by agreement of the parties acting reasonably in good faith or
(ii) if agreement cannot be reached within six (6) months after commencement of
negotiations, by Arbitration, in either case considering the relative importance
and proprietary protection of the various products and components involved.

          1.15 "Patent Rights" shall mean patent applications and issued
patents, as well as any divisions, continuations, continuations-in-part,
reissues, reexaminations, extensions or other governmental actions which extend
any of the subject matter of such patent application or patent, and any
substitutions, confirmations, registrations, or revalidations of any of the
foregoing, which cover Licensed Compounds, Derivative Compounds, Licensed
Products or Improvements or the use thereof.

          1.16 "Phase I", "Phase II", and "Phase III" shall mean Phase I (or
Phase I/II), Phase II (or Phase II/III), and Phase III clinical trials,
respectively, in each case as prescribed by applicable FDA IND Regulations, or
any corresponding foreign statutes, rules or regulations.






*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.



                                        3



          1.17 "PNP" shall mean the enzyme Purine Nucleoside Phosphorylase.

          1.18 "Primary Indications" shall mean T-Cell malignancy, atopic
dermatitis and rheumatoid arthritis.

          1.19 "Proprietary Information" of a Disclosing Party shall mean the
following, to the extent previously, currently or subsequently disclosed to the
other party hereunder or otherwise: information relating to Licensed Products,
Licensed Compounds, Derivative Compounds, Improvements, the properties,
composition or structure thereof or the manufacture or processing thereof or
machines therefor or to the Disclosing Party's business (including, without
limitation, reagents, computer programs, algorithms, names and expertise of
employees and consultants, know-how, formulas, processes, ideas, inventions
(whether patentable or not), schematics and other technical, business,
financial, customer and product development plans, forecasts, strategies and
information).  In particular, but without limitation, Technology and Licensor
Improvements shall be considered Proprietary Information of Licensor, Licensee
Improvements shall be considered Proprietary Information of Licensee, and Joint
Improvements shall be considered Proprietary Information of both parties.

          1.20 "Proprietary Rights" shall mean Patent Rights, copyrights, trade
secret rights, trademarks and similar rights.

          1.21 "Receiving Party" shall mean a party hereto that receives
Proprietary Information of the other party.

          1.22 "Sublicensee" shall mean a third party sublicensed by Licensee,
but only if such sublicense has been authorized and granted in accordance with
Section 3 hereof.

          1.23 "Technology" shall mean inventions (whether or not patentable),
ideas, processes, formulas and know-how related to a Licensed Compound, a
Derivative Compound or a Licensed Product and owned by Licensor and used by it
as of the Effective Date of this Agreement.  

          1.24 "T-Cell Malignancy" shall mean Adult T-Cell Leukemia, Cutaneous
T-Cell Lymphoma and any other T-Cell cancers.

          1.25 "Term" shall mean the duration of this Agreement as defined in
Section 16 hereof.

          2.   License Grant.  Subject to all the terms and limitations of this
               -------------
Agreement, Licensor hereby grants Licensee an exclusive license under its
Proprietary Rights to develop, produce, import, market, use and sell Licensed
Compounds, Derivative Compounds and Licensed Products within the Field in Japan,
and to use the Technology for the foregoing purpose, for the Term of this
Agreement.



                                        4


          3.   License Scope.  
               -------------

          3.1  Licensee's license will be exclusive for the purposes and country
stated in Section 2.  Licensee's license is strictly limited to the Field and
Licensee may not develop, produce, import, market, use or sell Licensed Products
for any indications other than the Primary Indications, unless and until the
parties execute a written agreement in relation to other indications for a
Licensed Product pursuant to Section 9 hereof; provided that Licensor shall not
unreasonably refuse execution of such an agreement.  Except as set forth in
Exhibit A to this Agreement, Licensor has not and shall not during the Term of
- ---------
this Agreement, grant any license to any third party to develop and
commercialize a PNP inhibitor product in Japan.

          3.2  Manufacture under the license is authorized and will take place
only in Japan and will be performed solely by Licensee or a contractor nominated
by Licensee and approved in advance in writing by Licensor.  No Licensed
Products or combination products incorporating a Licensed Product will be
marketed or sold directly or indirectly outside of Japan by or under the
authority of (i) Licensee, (ii) any of Licensee's Affiliates, (iii) any
Sublicensee, (iv) any direct or indirect customer of Licensee, its Affiliates or
Sublicensees or (v) any participant in a distribution channel of Licensee, its
Affiliates or Sublicensees for any Licensed Products (for example, a distributor
or dealer).

          3.3  Licensee has the right to grant sublicenses of the rights granted
hereunder, subject in each case to Licensor's prior written consent to the
sublicense, which consent shall not be unreasonably withheld.  Licensee shall
remain responsible for all of its obligations hereunder in the event it grants a
sublicense.  It shall be a condition for Licensor's consent to the grant of any
sublicense that:

          (a)  the sublicensee shall be bound in writing to all the limitations
and restrictions on Licensee set forth herein;

          (b)  the sublicense shall not be further sublicensable;

          (c)  Licensee shall pay to Licensor all the development milestone
payments specified in Section 8.4 or otherwise agreed between the parties in
respect of Additional Indications, upon the accomplishment of development
milestones by either Licensee or the sublicensee; and

          (d)  Licensee shall pay to Licensor the royalties specified in Section
8.5 in respect of all Net Sales of Licensed Products by the sublicensee.

In addition, if during the first three years of this Agreement Licensee receives
sublicense income that is over and above the value of the income due to Licensor
under this Agreement (the sublicense income of Licensee, less any amounts due to
Licensor, shall hereinafter be referred to as the "Premium"), the parties agree
that Licensor shall be entitled to share equally in such Premium.  For purposes
of this Agreement, Licensee's "sublicense income" 


                                        5



shall include all forms of compensation, royalties, milestone payments,
reimbursement, assets and value to be received by Licensee in connection with a
sublicense, but shall exclude payments purely for actual research and
development costs borne by Licensee.  Moreover, Licensee shall pay to Licensor
(i) one half of any Premium previously received by Licensee, (ii) one half of
any future Premium received by Licensee pursuant to sublicenses granted within
the first three years of this Agreement, and (iii) the milestone payments and
royalties due to Licensor as specified in Section 3.3(c) and 3.3(d) above.

          3.4  During the Term of this Agreement Licensee shall have the option
of discontinuing its research and development activities with respect to any
given Primary Indication, and redirecting its efforts towards another mutually
agreed indication for a Licensed Product (a "Substitute Indication").  To
exercise such option, Licensee shall provide Licensor with three (3) months
prior written notice (i) that Licensee desires to substitute a Primary
Indication, and (ii) of the identity of the Substitute Indication that Licensee
wishes to pursue.  The parties shall promptly meet thereafter to discuss and
agree on the proposed Substitute Indication and the terms for its substitution,
including but not limited to, the development schedule for such Substitute
Indication; provided, however, that the arrangements with regard to development
milestone payments for Substitute Indications shall be those specified in
Section 8.4 hereof for the substituted Primary Indication and the royalties in
relation to Licensed Products for Substitute Indications shall be those
specified in Section 8.5 hereof, and such financial arrangements for Substitute
Indications will not be subject to further discussion.  As soon as the parties
have agreed in a written amendment to this Agreement to make the substitution
and have reached agreement as to any necessary adjustments to the terms of this
Agreement, all references to Primary Indications herein shall refer to the
retained Primary Indications and the Substitute Indication.  Thereafter, the
parties may seek Sublicensees for the substituted Primary Indication.  In the
event that either party identifies a suitable Sublicensee, the parties shall
work together to negotiate a suitable sublicense arrangement with the
Sublicensee for the substituted Primary Indication in Japan, taking into
consideration the factors set forth in Section 3.3 hereof.  Although Licensee
shall not be under an obligation to find suitable Sublicensees, Licensee agrees
that it shall reasonably cooperate with Licensor's efforts in connection with
potential Sublicensees and agrees that any sublicense in Japan shall be granted
by Licensee in accordance with the terms of this Agreement.  In the event that
Licensor finds a Sublicensee which Licensor believes to be acceptable, Licensee
shall not unreasonably withhold its consent or cooperation in connection with
the grant of a sublicense to such Sublicensee; provided, however, that the
rights offered to such Sublicensee, considered as a whole, are not (unless
offered to Licensee for at least thirty (30) days) materially less favorable to
Licensor than the terms last offered by Licensor to Licensee.

          3.5  During the Term of this Agreement, Licensee shall have the right
to negotiate with Licensor in relation to obtaining an extension to the
geographical scope of the license granted hereunder in respect of other
countries and territories within Asia.  Any such extension shall be on terms and
conditions to be agreed between the parties, including but not limited to, the
additional financial consideration to be received by Licensor for such an
extension of the geographical scope of the license. 




                                        6



          3.6  During the Term of this Agreement, Licensor shall have the right
to negotiate with Licensee in relation to a supply arrangement pursuant to which
Licensee would supply Licensed Compounds or Licensed Product to Licensor for
sale outside of Japan.  Any such supply arrangement would be on terms and
conditions to be agreed between the parties including, but not limited to, the
payments to be received by Licensee for the supply of Licensed Compounds or
Licensed Products.

          4.   Improvements.  
               ------------

          4.1  The parties agree to promptly disclose to each other all
Improvements they make during the Term of this Agreement.  To assist in the
transfer of Improvements, each party will be entitled to have a development
engineer observe the operations of the other related to the subject matter of
this Agreement for up to one month per year during the Term of this Agreement.

          4.2  The parties' respective rights of ownership and rights to use any
Improvements are set forth in Section 14 of this Agreement.

          5.   Transfer of Technology.  
               ----------------------

          5.1  To carry on the physical transfer of the Technology from Licensor
to Licensee, Licensor shall disclose to Licensee the Licensor's Proprietary
Information relating to the Licensed Products, Licensed Compounds and Derivative
Compounds, in a mutually acceptable tangible form as follows:

               (a)  After the Effective Date of this Agreement and at Licensee's
request, Licensor shall disclose and/or furnish to Licensee sufficient details
of the Proprietary Information relating to the Licensed Products, Licensed
Compounds and Derivative Compounds as exists as of the Effective Date, which are
in written and/or drawn form, so as to enable Licensee to use such Technology
for the purposes of this Agreement;

               (b)  The technical documentation with respect to the Technology
which Licensor has provided Licensee to develop, produce, import, market, use
and sell Licensed Products are listed in Exhibit B attached hereto;
                                         ---------

               (c)  In addition to the above, Licensor shall continue to
disclose and provide Licensee with any other Technology, Proprietary Information
and/or other information which Licensor believes is likely to be useful for
Licensee to complete the purposes contemplated herein; and

               (d)  In the event that Licensee should reasonably request
clarification of any of the Technology, the Proprietary Information and/or other
information disclosed and/or provided hereunder by Licensor, then Licensor shall
promptly respond to such request.


                                        7




          5.2  Licensor shall, upon Licensee's reasonable request, give
technical guidance to Licensee by dispatching one of Licensor's researchers (a
"Researcher") to Licensee in accordance with the following terms and conditions:

               (a)  The number of Researchers that Licensor shall be required to
make available at any one time shall not be more than three (3) Researchers;

               (b)  The aggregate number of Researcher man days which Licensor
shall be required to provide after this Agreement comes into effect shall not be
more than twenty (20) Researcher man days in any twelve (12) month period. 
However, if it becomes necessary to increase such number, such increase shall
only be made with the mutual agreement of Licensor and Licensee;

               (c)  The "Researcher man day" period stipulated in the preceding
item (b) of this Section 5.2 shall mean each twenty-four (24) hour period during
the time from when a Researcher leaves Birmingham, Alabama, U.S.A. or his main
place of residence in the U.S.A. ("Home Base") to the time when Researcher
returns to his Home Base;

               (d)  Of the expenses arising out of dispatching a Researcher
under this Agreement, Licensee shall bear the following:

                    i)   air fare, other travel, hotel and meal expenses from
his Home Base to Japan, during his time in Japan, and back to his Home Base;

                    ii)  THIRTY U.S. DOLLARS ($30) per Researcher, per man day,
as an allowance; and

                    iii) all of the expenses for medical and surgical treatments
that Researcher may receive within Japan.

All of the expenses mentioned above except iii) shall be paid in advance by
Licensee.  The expenses referred to in iii) shall be paid promptly by Licensee
after being sent an invoice by Licensor for such expenses.

          5.3  Licensor shall, upon Licensee's reasonable request, train
Licensee's personnel (each a "Trainee") for purposes related to this Agreement
at Licensor's premises in accordance with the following terms and conditions:

               (a)  The number of Trainees that Licensor shall be required to
train at any one time shall not be more than two (2) Trainees;

               (b)  Licensor shall provide a reasonable number of training man
days, determined on the basis of the project in question, but the aggregate
number of training 


                                        8








man days to be provided by Licensor shall not be more than twenty (20) training
man days in any twelve (12) month period during the Term of this Agreement;

               (c)  Licensee shall bear all expenses in relation to the
Trainees, including but not limited to, transportation expense from Japan to
Birmingham, Alabama and back, and room and board; and 

               (d)  Licensee shall bear whatever expenses which are necessary
for the actual training of a Trainee at Licensor's premises.

          6.   Research, Development and Regulatory Approval.
               ---------------------------------------------

          6.1  Licensee shall conduct all research, development and regulatory
approval work for Licensed Products in Japan, and Licensee shall bear all costs
and expenses incurred in connection therewith.

          6.2  Licensee shall use its best efforts to perform its research and
development work in relation to the Licensed Products in accordance with the
mutually agreed Development Schedule attached hereto as Exhibit C.  In addition
                                                        ---------
the parties also agree that:

               (a)  The Development Schedule represents [ * ].  [ * ]  
Within [ * ] days of [ * ] the parties shall [ * ].

               (b)  The development and commercialization of the Licensed
Products in the Japanese market is [ * ], and [ * ].  Licensor and Licensee
shall discuss the progress of Licensee's development and commercialization of
the Licensed Products as frequently as necessary [ * ]. [ * ]. Within [ * ] 
Licensee shall [ * ] and a [ * ].  Licensor will review





*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.


                                        9



[ * ] and plan and work with [ * ] which is [ * ], [ * ] of the date of the
[ * ] to Licensor. [ * ] to the greatest extent possible.  In the event that
[ * ] In the event that [ * ] If the Development Schedule is [ * ] [ * ].

          6.3  Licensor shall provide Licensee with as much BCX-34 (synthesized
by a method used by Licensee in Japan) as Licensor's production capacity allows
up to five (5) kilograms for preclinical research [ * ].  Licensor shall also
provide Licensee with additional quantities of BCX-34 for preclinical and
clinical development purposes [ * ]; provided, however, that Licensor shall not
be obligated to supply quantities of BCX-34 in the aggregate in excess of ten
(10) kilograms unless Licensee gives Licensor nine (9) months prior written
notice of its requirements for BCX-34 in such quantities.

          6.4  Simultaneously with the supply of BCX-34 as set forth in Section
6.3, Licensor shall provide Licensee with sample quantities of by-products,
intermediates and reagents for BCX-34, and up to ten (10) grams of starting
material for BCX-34 [ * ].

          6.5  In addition to the provision of Researchers pursuant to Section
5.2 hereof, Licensor agrees to provide to Licensee reasonable technical
consulting services and assistance in connection with Licensee's research,
development and regulatory efforts, including without limitation, meetings with
relevant scientists and on-site support at Licensee's facilities, subject to the
following terms and conditions:







*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.




                                       10



               (a)  Such services will only be provided at the request of
Licensee;

               (b)  Such services will only be provided to the extent that
Licensor has the personnel and other resources available at the time of
Licensee's request;

               (c)  Such services will be provided at times and places mutually
acceptable to the parties; 

               (d)  [ * ] but Licensee shall reimburse Licensor for all
reasonable expenses incurred in connection with the provision of such services
including, but not limited to, travel from the consultant's Home Base to Japan
and back, and such consultant's room and meals in Japan, and all of the expenses
for medical and surgical treatments that such consultant may receive within
Japan.  All expenses (except expenses for medical and surgical treatments) will
be paid in advance by Licensee. The expenses for medical and surgical treatments
shall be paid promptly by Licensee after being sent an invoice by Licensor for
such expenses; and

               (e)  Licensor shall invoice Licensee on a monthly basis for all [
* ], which invoices shall be promptly paid, and in any event paid within thirty
(30) days of the date of Licensor's invoice.

          6.6  Licensor shall have the right to review and comment upon the
progress of the development and regulatory work being carried out by Licensee. 
Licensee shall provide quarterly written reports to Licensor as to the progress
of its development and regulatory work.  Such reports shall be prepared in
English and shall include translations of any important data.  To the extent
that Licensor reasonably requests additional data, information, and transcripts,
Licensee shall promptly provide English translations of such data, information
and transcripts.  Licensor shall also have the right to request meetings to
discuss Licensee's development and regulatory work, at times and places that are
mutually convenient to both parties; provided that such meetings are not more
frequent than twice per calendar year.

          6.7  The parties shall cooperate in relation to their respective
development efforts in relation to the Licensed Products, which shall include,
but not be limited to, providing all data and information relating to their
respective development activities that would support or be required for
regulatory filings.

          7.   Marketing.  
               ---------

          7.1  Licensee will use reasonable commercial efforts to produce and
market Licensed Products.  On or before the initiation of Phase III trials for a
Primary Indication or an Additional Indication, Licensee shall provide Licensor
with a detailed marketing plan for such indication in Japan.  Such marketing
plan shall provide details as to the following: (i) target sales for the
Licensed Product for each year after product launch; (ii) estimated pricing for
the Licensed Product; (iii) estimated market penetration for the Licensed
Product for each 




*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.



                                      11




year after product launch; (iv) description of structure, size and organization
of sales force for the Licensed Product; (v) sales and promotional activities,
materials and packaging for the Licensed Product; and (vi) description of
competitive products already in the market, including sales estimates.  Licensor
shall review and comment upon such marketing plan and Licensee shall take
account of Licensor's comments and incorporate Licensor's suggestions into its
plans.

          7.2  Prior to the first commercial sale of any Licensed Product in
Japan, the parties shall mutually agree upon the trademarks to be used in
relation to the Licensed Products in Japan (the "Marks").  [ * ].

          7.3  Licensee agrees that all packaging containing Licensed Products
sold by Licensee, its Affiliates and Sublicensees will be marked that Licensed
Products are manufactured and sold under license from BioCryst Pharmaceuticals,
Inc.

          8.   Payments.
               --------

          8.1   Equity Investment.  Simultaneously with the execution of this
                -----------------
Agreement, Licensor and Licensee shall execute a Stock Purchase Agreement in the
form attached hereto as Exhibit D (the "Stock Purchase Agreement") providing for
                        ---------
an investment of ONE MILLION FIVE HUNDRED THOUSAND U.S. DOLLARS ($1,500,000) in
cash for shares of Licensor's Common Stock, $0.01 per share par value ("Common
Stock"), at the price per share specified in the Stock Purchase Agreement.

          8.2  Upfront Payment.  As payment for the license under Licensor's
               ---------------
Proprietary Rights granted to Licensee hereunder, Licensee agrees to pay
Licensor ONE MILLION FIVE HUNDRED THOUSAND U.S. DOLLARS ($1,500,000) on the
Effective Date of this Agreement, which payment shall be non-creditable and non-
refundable.

          8.3  Initial Payments.  
               ----------------

          (a)  As soon as practicable but not later than two (2) weeks after the
completion of the [ * ], the parties shall meet at Licensor's headquarters in
Birmingham, Alabama, USA.  At such meeting Licensor's principal investigators
will present to and discuss with Licensee's representatives the safety,
pharmacology and clinical results of [ * ].  After the completion of the
meeting, Licensee shall have the period of three (3) weeks to make a payment to
Licensor of [ * ] as part consideration for the license under Licensor's
Proprietary Rights granted to Licensee hereunder.  Such payment shall be non-
creditable and non-refundable, and shall be made





*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.



                                       12







[ * ].  In the event that Licensee fails to make such payment within such
period, this Agreement shall be deemed terminated as of the latest date on which
such payment could have been made.

          (b)  [ * ], the parties shall meet at Licensor's headquarters in
Birmingham, Alabama, USA.  At such meeting Licensor's principal investigators
will present to and discuss with Licensee's representatives the safety,
pharmacology and clinical results of [ * ].  After the completion of the
meeting, Licensee shall have the period of three (3) weeks to make a payment to
Licensor of [ * ] as part consideration for the license under Licensor's
Proprietary Rights granted to Licensee hereunder.  Such payment shall be non-
creditable and non-refundable, and shall be made either before expiration of [ *
].  In the event that Licensee fails to make such payment within such period,
this Agreement shall be deemed terminated as of the latest date on which such
payment could have been made.

          (c)  In the event the [ * ] but a [ * ], the parties shall proceed
with [ * ], except that [ * ].  In all other respects Section [ * ] shall remain
unchanged in such circumstances.

          8.4  Development Milestone Payments.
               ------------------------------

          (a)  Licensee also agrees to pay to Licensor each of the amounts set
forth in Table 8.4 below upon accomplishment by Licensor, Licensee, their
respective Affiliates, Sublicensees or other designees, of the corresponding
development milestone set forth in Table 8.4 for each Primary Indication.  Such
milestone payments shall in the aggregate total [ * ].  Licensee shall have no
obligation to pay any of the following milestone payments more than one (1) time
with respect to a particular Primary Indication, regardless of how many Licensed
Products are commercialized in respect of such Primary Indication.





*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.



                                       13




                                    Table 8.4
                                    ---------
                                      [ * ]





*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.







                                       14


All payments made to Licensor by Licensee pursuant to this Section 8.4(a) shall
be due within thirty (30) days after the accomplishment of the corresponding
milestone and shall be nonrefundable and noncreditable.  It is understood that
the milestone payments set forth above shall be made on a per indication basis,
so that if Licensee ceases all development of a Licensed Product for a
particular Primary Indication after having made payments with respect to such
Licensed Product under this Section 8.4(a) on the accomplishment of milestones
specified herein, there shall be no payment due upon the accomplishment of those
same milestones with respect to a subsequent Licensed Product hereunder that is
active against the same Primary Indication.  Amounts due with respect to
milestones achieved with respect to such subsequent Licensed Product which were
not previously paid with respect to an earlier Licensed Product for the same
Primary Indication shall be paid pursuant to this Section 8.4(a).

          (b)  In the event that Licensee exercises its option pursuant to
Section 3.4 hereof to adopt a Substitute Indication after making one or more
development milestone payments under Section 8.4(a) for a Licensed Product for
the Primary Indication that is to be substituted, there shall be no payment due
upon the accomplishment of those same milestones with respect to a Licensed
Product for the Substitute Indication.  Amounts due with respect to milestones
achieved with respect to a Licensed Product for the Substitute Indication which
were not previously paid with respect to an earlier Licensed Product for the
substituted Primary Indication shall be paid pursuant to Section 8.4(a).

          8.5   Royalty on Licensed Products.  
                ----------------------------

          (a)  Licensee shall pay to Licensor in respect of Net Sales of
Licensed Products made by Licensee, its Affiliates and Sublicensees, running
royalties at the rates specified in Table 8.5 below:

                                    Table 8.5
                                    ---------


                                      [ * ]







*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.




                                       15





[ * ].

          (b)  After [ * ]. Such [ * ], and shall be based upon [ * ] becomes 
effective, [ * ] or the [ * ] shall [ * ].

          8.6  Notwithstanding anything else in this Agreement, the percentage
royalty rates payable by Licensee after all other adjustments, shall be reduced
by one of the following amounts, in the circumstances specified below:

          (a)  by [ * ] for any Licensed Product sold in Japan if at the time of
the sale the Proprietary Rights licensed hereunder do not include an issued
Japanese patent with a claim covering an aspect of such Licensed Product; or 

          (b)  by [ * ] for any Licensed Product sold in Japan if at the time of
the sale of the Licensed Product in Japan (i) the Proprietary Rights licensed
hereunder do not include an issued Japanese patent with a claim covering an
aspect of such Licensed Product and (ii) a competitor's product with the
identical chemical compound as the Licensed Product has a twenty-five (25%) or
greater share of the market in Japan for products active against all indications
for such Licensed Product, as measured by the aggregate dollar value of sales of
all such products in Japan, within the calendar year.

Licensee shall continue to pay Licensor royalties on Net Sales of Licensed
Products at the full rates set forth in this Section 8, until such time as
Licensee has determined and confirmed in writing to Licensor, subject to
reasonable verification, that the criteria for reducing the royalty applicable
to such Net Sales in Japan have been met and that the royalties payable to
Licensor may be reduced.  If after such a determination by Licensee the criteria
set forth in Section 8.6(a) or 8.6(b) for reducing the royalties due to Licensor
is no longer satisfied, Licensee shall promptly notify Licensor and resume
payment of the applicable royalty at its full rate.

          8.7  Licensor shall have the right and option to assign its right to
receive any or all payments under this Agreement to one or more of its
Affiliates.  Licensor shall notify Licensee in writing if it exercises such
option, and Licensee shall provide reasonable cooperation in connection with
such revised payment arrangements.






*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.



                                       16







          8.8  Licensee may withhold applicable Japanese taxes for the account
of Licensor to the minimum extent required by law and treaty.  Licensee shall
provide Licensor with at least thirty (30) days prior written notice of any
withholding it is required to make from a payment due to Licensor hereunder
under the laws of Japan and Licensee shall cooperate and discuss with Licensor
the basis for such withholding with Licensor.  Licensee will promptly provide
Licensor with receipts from taxing authorities evidencing payment of all amounts
withheld.

          8.9  Royalties shall be paid within forty-five (45) days of the end of
each calendar quarter with respect to royalty-bearing sales and use occurring in
that quarter. Royalties shall be paid by Licensee from Japan in U.S. dollars
with currency conversions calculated based upon the applicable closing U.S.
Dollars selling rate against Japanese Yen to customers quoted by The Bank of
Tokyo - Mitsubishi, Ltd. (Tokyo) foreign exchange desk on the day of payment. 
Late payments will bear interest at the rate of [ * ] per month to cover the
Licensor's costs of collections as well as interest, or, if lower, the maximum
rate allowed by law.

          8.10 Licensee, its Affiliates and Sublicensees shall keep and maintain
detailed and accurate books and records with regard to Net Sales, royalties and
the calculation thereof.  Licensor or its representatives (who shall be
reasonably acceptable to Licensee) shall be entitled to review and audit such
books and records from time to time during normal business hours upon reasonable
notice to Licensee and at Licensor's expense; provided that Licensee will bear
any such expense if the review or audit shows an underpayment of more than 5%
for the applicable period and furthermore the Licensee shall remit to Licensor
the amount of any underpayment and interest thereon calculated at the rates set
forth in Section 8.9, calculated from the dates that the relevant payments
should have been made.


          9.   Additional Indications.  
               ----------------------

          9.1  Licensee may notify Licensor at any time during the Term that it
wishes to commence development of a Licensed Product for a particular Additional
Indication in Japan (a "Licensee Additional Indication Notice"). In addition,
Licensor may at any time make a presentation to Licensee as to the potential for
developing a Licensed Product for an Additional Indication (a "Licensor
Additional Indication Presentation").  Subsequent to a Licensee Additional
Indication Notice or a Licensor Additional Indication Presentation, the parties
shall promptly enter into negotiations with regard to the payment, development
and other arrangements for the Additional Indication that is the subject of the
notice or presentation, and such negotiations shall be carried out in good faith
and at mutually convenient times and locations.  The parties acknowledge that
the payment arrangements for Additional Indications, regardless of whether or
not regulatory approval is required in Japan for the Licensed Products for the
Additional Indication, shall include (i) running royalties at rates set forth in
Section 8 hereof and that Net Sales of Licensed Products for Additional
Indications shall be aggregated with the Net Sales of Licensed Products for
Primary Indications for purposes of determining the applicable royalty rate, and
(ii) development milestone payments, which shall be non-refundable, non-
creditable payments on a per indication basis consistent with those payments set
forth in Section 8.  If the parties 





*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.




                                      17






reach agreement they shall either enter into a written amendment to this
Agreement or a separate written agreement to give effect to their agreement as
to the payment, development and other arrangements for the Additional
Indication.  If Licensee and Licensor cannot reach an agreement within three (3)
months of a Licensee Additional Indication Notice or a Licensor Additional
Indication Presentation having been received, or if Licensee elects not to
pursue such Additional Indication, Licensor and Licensee shall work together to
obtain a suitable Sublicensee for the Licensed Products for the Additional
Indication in Japan, taking into consideration the factors set forth in Section
3.3 hereof.  Although Licensee shall not be under an obligation to find suitable
Sublicensees, Licensee agrees that it shall reasonably cooperate with Licensor's
efforts in connection with potential Sublicensees and agrees that any sublicense
in Japan shall be granted by Licensee in accordance with the terms of this
Agreement.  In the event that Licensor finds a Sublicensee which Licensor
believes to be acceptable, Licensee shall not unreasonably withhold its consent
or cooperation in connection with the grant of a sublicense to such Sublicensee;
provided, however, that the rights offered to such Sublicensee, considered as a
whole, are not (unless offered to Licensee for at least thirty (30) days)
materially less favorable to Licensor than the terms last offered by Licensor to
Licensee.

          9.2  In the event that Licensor can demonstrate to Licensee's
reasonable satisfaction that the Licensed Products are being used and/or
prescribed for Additional Indications that are not subject to an existing
agreement between Licensor and Licensee pursuant to Section 9.1 above, the
Licensor shall be at liberty to provide Licensee with a Licensor Additional
Indication Presentation pursuant to Section 9.1 hereof.  After such
presentation, the parties shall begin negotiations as soon as practicable in
order to agree upon terms for such Additional Indication in accordance with
Section 9.1 hereof.

          10.  Representations, Warranties and Indemnitees.
               -------------------------------------------

          10.1 Licensor represents and warrants to Licensee that Licensor has
full power and authority to enter into this Agreement and to grant the licenses
granted to Licensee hereunder.

          10.2 Licensee represents and warrants to Licensor that Licensee has
full power and authority to enter into this Agreement and will carry on its
development, marketing and sales and other obligations hereunder promptly, in
good faith and in accordance with the highest industry standards.

          10.3 Licensor shall indemnify, defend and hold harmless the Licensee,
its Affiliates and their respective officers, directors, agents and employees
(the "Licensee Indemnitees"), against any liability, damage, loss or expense
(including but not limited to fees and disbursements of counsel incurred by a
Licensee Indemnitee in any action or proceeding between Licensor and a Licensee
Indemnitee or between a Licensee Indemnitee and any third party or otherwise)
resulting directly from either (i) infringement by the Licensed Products of any
Japanese patent issued to a third party prior to the Effective Date of this
Agreement [ * ] pursuant to this Agreement.






*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.




                                       18





          10.4 The Licensee shall indemnify, defend and hold harmless the
Licensor, its Affiliates and their respective officers, directors, agents and
employees (the "Licensor Indemnitees"), against any liability, damage, loss or
expense (including but not limited to fees and disbursements of counsel incurred
by a Licensor Indemnitee in any action or proceeding between the Licensee and a
Licensor Indemnitee or between a Licensor Indemnitee and any third party or
otherwise) arising from any product liability or other lawsuit, claim, demand or
other action brought with respect to (i) development work and clinical trials
conducted by Licensee, its Affiliates or Sublicensees in relation to a Licensed
Product, (ii) Licensed Products manufactured by Licensee, its Affiliates or
Sublicensees, or (iii) Licensed Products imported, distributed or sold by
Licensee, its Affiliates or Sublicensees (except in this case (iii) if the
Licensed Product was manufactured by Licensor or its Affiliates), regardless of
whether or not Licensor is named as a defendant in any such lawsuit; provided,
however, that the foregoing indemnity shall not apply to the extent that such
liability, damage, loss or expense is covered by the indemnity provided for
under paragraph 10.3 hereof.

          10.5 The Licensee Indemnitees shall promptly notify Licensor in
writing and the Licensor Indemnitees shall promptly notify Licensee in writing
of any lawsuit, claim, demand or other action or threat thereof in respect of
which indemnification may be sought under this Section 10 and, to the extent
allowed by law, the Licensee Indemnitees and the Licensor Indemnitees, as the
case may be, shall reasonably cooperate with the indemnifying party in defending
or settling any such lawsuit, claim, demand or other action.  No settlement of
any claim, suit or threat thereof for which indemnification is sought, shall be
made without the prior written approval of the indemnifying party.  The
indemnifying party will have sole control over the defense and/or settlement,
subject to the Licensee Indemnitees' and Licensor Indemnitees', as the case may
be, right to select and use their own counsel at their sole cost and expense.

          11.  Diligence; Protection and Acknowledgment of Value of Technology. 
               ---------------------------------------------------------------
As a matter of convenience, to ensure diligence under Sections 6 and 7, to
protect Licensor's Proprietary Information and as an acknowledgement that (i)
Licensee is not currently in the business of producing any products that are PNP
inhibitors or products incorporating any products that are PNP inhibitors and
(ii) accordingly, any activity in that area by Licensee after Licensee has had
access to Licensor's Proprietary Information would almost certainly rely on, be
built on or include Licensor's Proprietary Information, Licensee agrees that: 
(A) the royalties under Section 8 shall apply to all products that are PNP
inhibitors produced and sold under Licensee's authority, and (B) except as
authorized under this license, during the Term and during the two-year period
thereafter (but not longer than 20 years after the Effective Date), neither
Licensee nor any of Licensee's Affiliates will directly or indirectly engage in
the business of producing products that are PNP inhibitors.

          12.  Confidentiality.  
               ---------------

          12.1 Each party recognizes the importance to the other of the other's
Proprietary Information.  In particular Licensee recognizes that the Technology,
Licensor's Improvements and Licensor's Proprietary Information (and the
confidential nature thereof) are critical to the business of Licensor and that
Licensor would not enter into this Agreement without assurance that such
technology and information and the value thereof will be 


                                       19





protected as provided in this Section 12 and elsewhere in this Agreement. 
Accordingly, each party agrees to comply with the provisions of this Section 12.

          12.2 The Receiving Party agrees (i) to hold the Disclosing Party's
Proprietary Information in confidence as a fiduciary and to take all reasonable
precautions to protect such Proprietary Information (including, without
limitation, all precautions the Receiving Party employs with respect to its
confidential materials), (ii) not to divulge (except pursuant to a sublicense
authorized and granted in accordance with Section 3 of this Agreement) any such
Proprietary Information or any information derived therefrom to any third
person, (iii) not to make any use whatsoever at any time of such Proprietary
Information except as expressly authorized in this Agreement, and (iv) not to
remove or export from the United States or reexport any such Proprietary
Information or any direct product thereof (e.g., Licensed Products by whomever
made) to Afghanistan, the Peoples' Republic of China or any Group Q, S, W, Y or
Z country (as specified in Supplement No. 1 to Section 770 of the U.S. Export
Administration Regulations, or a successor thereto) or otherwise except in
compliance with and with all licenses and approvals required under applicable
export laws and regulations, including without limitation, those of the U.S.
Department of Commerce.  Any employee given access to any such Proprietary
Information must have a legitimate "need to know" and shall be similarly bound
in writing.  Without granting any right or license, the Disclosing Party agrees
that the foregoing clauses (i), (ii) and (iii) shall not apply with respect to
information that the Receiving Party can document (i) is in or (through no
improper action or inaction by the Receiving Party or any Affiliate, agent or
employee) enters the public domain (and is readily available without substantial
effort), or (ii) was rightfully in its possession or known by it prior to
receipt from the Disclosing Party, or (iii) was rightfully disclosed to it by
another person without restriction, or (iv) was independently developed by it by
persons without access to such information and without use of any Proprietary
Information of the Disclosing Party.  The Receiving Party must promptly notify
the Disclosing Party of any information that it believes comes within any
circumstance listed in the immediately preceding sentence and will bear the
burden of proving the existence of any such circumstance by clear and convincing
evidence.  Each party's obligations under this Section 12.2 (except under clause
(iv) of the first sentence) shall terminate 20 years after the termination of
this Agreement.

          12.3 Immediately upon termination of this Agreement, the Receiving
Party will turn over to the Disclosing Party all Proprietary Information of the
Disclosing Party and all documents or media containing any such Proprietary
Information and any and all copies or extracts thereof.

          12.4 The Receiving Party acknowledges and agrees that due to the
unique nature of the Disclosing Party's Proprietary Information, there can be no
adequate remedy at law for any breach of its obligations hereunder, that any
such breach may allow the Receiving Party or third parties to unfairly compete
with the Disclosing Party resulting in irreparable harm to the Disclosing Party,
and therefore, that upon any such breach or any threat thereof, the Disclosing
Party shall be entitled to appropriate equitable relief in addition to whatever
remedies it might have at law and to be indemnified by the Receiving Party from
any loss or harm, including, without limitation, lost profits and attorney's
fees, in connection with any breach or enforcement of the Receiving Party's
obligations hereunder or the unauthorized use or release of any such Proprietary
Information.  The Receiving Party will 






                                       20





notify the Disclosing Party in writing immediately upon the occurrence of any
such unauthorized release or other breach.  Any breach of this Section 12 will
constitute a breach of this Agreement.

          13.  Government Matters. 
               ------------------

          13.1 Licensee will promptly and timely file any required reports with
the Japanese Minister of Finance, Minister of Health and Welfare, Minister of
International Trade and Industry and any other relevant ministers (in each case,
through the Bank of Japan).

          13.2 As soon as possible, Licensee will make any necessary filings and
notifications with the Japanese Fair Trade Commission (the "FTC").  In the event
the FTC raises issues regarding this Agreement, Licensee will use its best
efforts to satisfy the FTC's concerns without any change to this Agreement.  If
the FTC makes recommendations to modify or delete any provision of this
Agreement, Licensor will work with Licensee reasonably and in good faith to
attempt to achieve a mutually acceptable resolution that does not materially
compromise Licensor's rights and that changes the Agreement to the minimum
extent and Licensee will fully support Licensor's position in dealings with the
FTC or the courts.  Licensee will promptly provide Licensor with (i) copies of
all correspondence to the FTC at least two business days before submission (and
Licensee will make any changes requested by Licensor), (ii) any correspondence
from the FTC, (iii) summaries of oral dealings with the FTC, and
(iv) simultaneous English translations of all of the foregoing.  If Licensor
determines that a satisfactory resolution is not likely to be reached, Licensor
may terminate this Agreement upon thirty (30) days written notice.

          14.  Ownership and Patent Matters.
               ----------------------------

          14.1 Except for the licenses granted to Licensee hereunder, as between
the parties, Licensor is the sole owner of all right, title and interest to the
Licensed Products, Licensed Compounds, Derivative Compounds, and all Technology
and Proprietary Rights in relation thereto.

          14.2 All right, title and interest to all Improvements made solely by
employees of Licensor ("Licensor Improvements") shall be deemed owned by
Licensor.  All right, title and interest to all Improvements made solely by
employees of Licensee ("Licensee Improvements") shall be deemed owned by
Licensee.  All right, title and interest to all Improvements made jointly by
employees of Licensor and Licensee ("Joint Improvements") shall be deemed
jointly owned by Licensor and Licensee.  Inventorship and ownership of
Improvements and all Proprietary Rights in relation thereto shall be determined
in accordance with the Federal laws of the United States.

          14.3 During the Term of this Agreement, all Licensor Improvements
(except improvements created specifically for a third party) and all Joint
Improvements shall be included in the license granted in Section 2 hereof,
without additional charge to Licensee.

          14.4 Licensee hereby grants to Licensor, an irrevocable, fully paid
up, exclusive worldwide (except for Japan) license under its Proprietary Rights
to develop, 








                                       21






produce, import market, use and sell all Licensee Improvements.  Such license
shall survive any termination of this Agreement and shall also be extended to
cover Japan on a non-exclusive basis in the event that this Agreement continues
in effect until the expiration of the Term.

          14.5 Licensor shall have the sole right and discretion to file and
prosecute patent applications and maintain patents in Japan and the rest of the
world relating to the Technology and any and all Licensor Improvements, using
Licensor's own counsel, [ * ].  At Licensee's request, while Licensee remains an
exclusive licensee hereunder, Licensor will discuss its decisions on these
patent matters with Licensee, but Licensor shall retain sole discretion over
such patent matters for the Technology and Licensor Improvements and Licensee
will not attempt to file or prosecute any such patent applications or maintain
any such patent.  While Licensee remains an exclusive licensee hereunder, if
Licensor elects not to file or maintain a patent application or maintain a
patent in relation to Technology or a Licensor Improvement in Japan, it shall so
notify Licensee, who shall have the option of making such filing or maintaining
such application or patent through its own patent attorneys and at its sole
expense.

          14.6 Licensee shall have the sole right and discretion to file and
prosecute patent applications and maintain patents in Japan and the rest of the
world relating to Licensee Improvements, using Licensee's own counsel [ * ].  At
Licensor's request, while Licensee remains an exclusive licensee hereunder,
Licensee will discuss its decisions on these patent matters with Licensor and
will provide Licensor with copies of all patent filings made and copies of all
correspondence with patent authorities in relation to such patent matters;
provided, however, that Licensee shall retain sole discretion over such patent
matters and Licensor will not attempt to file or prosecute any such patent
applications or maintain any such patent.  While Licensee remains an exclusive
licensee hereunder, if Licensee elects not to file or maintain a patent
application or maintain a patent in relation to a Licensee Improvement anywhere
in the world it shall so notify Licensor, who shall have the option of making
such filing or maintaining such application or patent through its own patent
attorneys and at its sole expense.

          14.7 The parties agree to discuss and make appropriate arrangements
for the prosecution and maintenance of patent applications and patents for Joint
Improvements in Japan and the rest of the world, using mutually acceptable
patent counsel.

          14.8 If Licensee becomes aware of any product or activity of any third
party that involves infringement or violation of any of Licensor's Patent 





*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.



                                       22






Rights or other Proprietary Right in Japan, then Licensee shall promptly notify
Licensor in writing of such infringement or violation.  Licensor may in its
discretion take or not take whatever action it believes is appropriate; if
Licensor elects to take action, Licensee will fully cooperate therewith at
Licensee's expense.  If Licensor does not, within ninety (90) days after receipt
of such a notice of a patent infringement within the scope of the exclusivity of
Licensee's license hereunder, commence action directed towards restraining or
enjoining such patent infringement, Licensee, so long as it is an exclusive
licensee hereunder, may take such legally permissible action as it deems
necessary or appropriate to enforce Licensor's Patent Rights and restrain such
infringement.  Licensor agrees to cooperate reasonably in any such action
initiated by Licensee including supplying essential documentary evidence and
making essential witnesses then in Licensor's employment available.  As part of
such cooperation, Licensee may join Licensor as a party, if the need arises,
although such joinder shall be entirely at Licensee's expense.  Licensee will
indemnify Licensor for any damages, expenses, costs and fees in connection with
Licensee's actions under this Section 14.8.  Nothing in this Section 14.8 allows
Licensee or requires Licensor to disclose Proprietary Information of Licensor. 
If Licensor initiates and prosecutes any such an action under this Section 14.8,
all legal expense (including court costs and attorneys' fees) shall be for
Licensor's account.  Similarly, if Licensee initiates and prosecutes such an
action, all legal expenses (including court costs and attorneys' fees) shall be
for Licensee's account.  All amounts awarded by way of judgment, settlement or
compromise in relation to an action initiated and prosecuted by either party
shall be applied as follows: (a) first, reimbursement of all legal expense
(including court costs and attorneys' fees), incurred by the parties, and (b)
then the [ * ] shall be divided between the parties, with [ * ] given to the 
party that initiated and prosecuted the action and [ * ] given to the other 
party.

          14.9 Licensee understands that Licensor has not conducted
comprehensive patent searches in Japan.  Licensor and Licensee agree to work
cooperatively regarding issues concerning patents and Proprietary Rights and
similar matters and to exercise reasonable business judgment in carrying out the
objects of this Agreement to avoid exposing either party to liability under
patent or similar laws in Japan or elsewhere.  Each party represents and
warrants that it is not aware of infringement or potential infringement issues
that have not been communicated to the other in writing before execution of this
Agreement.

          15.  Dispute Resolution.  
               ------------------

          15.1 In the event that any dispute arises between the parties in
connection with this Agreement, the representatives of each party responsible
for the subject matter of such dispute shall use good faith efforts to resolve
such dispute promptly.  In the event that such dispute cannot be resolved by the
parties' representatives, the matter shall be submitted to the parties'
respective Chief Executive Officers ("CEOs") for resolution.  In the event that
the CEOs cannot reach resolution of the issue (an "Unresolved Dispute"), then
the matter shall be settled by binding arbitration in accordance with the
provisions of this Section 15.

          15.2 Any Unresolved Dispute, after the completion of the steps set
forth in Section 15.1 hereof, shall be settled at the election of either party,
by final and binding independent arbitration as set forth below.

          (a)  Arbitration Procedures.
               ----------------------

               (i)  Rules and Location.  All arbitrations pursuant to this
                    ------------------
Agreement, shall be final and binding, shall be conducted before the American
Arbitration Association ("AAA") in New York, New York, U.S.A., and shall be
carried out in accordance with the Commercial Arbitration Rules of the AAA then
in effect (the "Rules") and the provisions of this Agreement.  Unless the
parties agree otherwise, all arbitrations pursuant to this Agreement shall also
be carried out in accordance with the AAA's Supplementary Procedures For Large,
Complex Disputes then in effect (the "Supplementary Procedures").  In the event




*     Indicates material that has been omitted and for which confidential
      treatment has been requested. All such omitted material has been filed
      separately with the Commission pursuant to Rule 24b-2.



                                       23





of a conflict between the Rules or Supplementary Procedures of the AAA and the
provisions of this Section 15, the provisions of this Section 15 shall govern.

               (ii)  Pre-Arbitration Notice.  Any party that intends to initiate
                     ----------------------
an arbitration of an Unresolved Dispute (the "Claimant") shall give fifteen (15)
days prior written notice to the other party of its intention to commence an
arbitration proceeding under this Section 15 (the "Pre-Arbitration Notice"). 
The Pre-Arbitration Notice shall set forth:  (i) a statement setting forth the
nature of the Unresolved Dispute; (ii) the Claimant's position and claims in
relation to the Unresolved Dispute; (iii) the amount or value of the claims
involved; and (iv) the remedies sought.  Unless the parties are able to reach a
mutually agreeable settlement within such fifteen (15) days, the Claimant may
initiate an arbitration in relation to the subject Unresolved Dispute thereafter
in accordance with the Rules and the Supplementary Procedures.

               (iii)  Appointment of the Arbitrators.
                      ------------------------------

                    (A)  Selection Process.  There shall be three (3)
                         -----------------
arbitrators for each arbitration of an Unresolved Dispute, unless the parties
otherwise agree to only one arbitrator.  Each party shall promptly select one
(1) arbitrator.  Each party's selection of an arbitrator shall be in that
party's sole discretion, and such arbitrator may be from a list provided by the
AAA or may be any other person chosen by such party.  A party's choice of
arbitrator shall not be subject to challenge by the other party, except pursuant
to subsection (B) of this Section.  Within twenty (20) days of the appointment
of the second arbitrator, the two arbitrators shall appoint the third arbitrator
from a list of arbitrators provided by the AAA, who shall be an attorney or a
former judge unless an arbitrator so qualified is unavailable; provided,
                                                               --------
however, that if the two existing arbitrators are unable to agree upon the third
- -------
arbitrator within such period, either party may request the AAA to appoint the
third arbitrator.  The parties agree to use good faith efforts to choose
arbitrators with appropriate qualifications in relation to the Unresolved
Dispute in question.  Such qualifications may include, but are not limited to,
expertise in patent law, medicinal chemistry, and/or pharmaceutical product
development (including clinical development and regulatory affairs), if
applicable.

                    (B)  Disqualification.  Notwithstanding anything to the
                         ----------------
contrary herein, no person may serve as an arbitrator pursuant to this Section
15 if such person has or has had in the past a material interest or relationship
(through employment, stock ownership, business dealings or otherwise) in or with
a party involved in any arbitration or any of its Affiliates, directors,
officers or employees; provided, however, that serving as an arbitrator
                       --------  -------
hereunder shall not constitute such a material interest or relationship for
purposes of future arbitrations.

               (iv)  Conduct of Proceedings.  The arbitration proceedings shall
                     ----------------------
be conducted in English and any written evidence originally in a language other
than English shall be submitted in English translation accompanied by the
original or a true copy thereof.  The arbitrators shall determine what discovery
will be permitted, consistent with the goal of limiting the cost and time which
the parties must expend for discovery; provided the arbitrators shall permit
such discovery as they deem necessary to permit an equitable resolution of the
dispute.  The arbitrators will apply the laws of the State of New York in 





                                       24






any arbitration, except in relation to patents or other forms of intellectual
property rights including, but not limited to, determination of inventorship of
inventions, or issues relating to interpretation, enforcement, validity, or
ownership of patents or other intellectual property rights, in which case the
arbitrators shall apply the Federal laws of the United States.

               (v)  Final Award and Costs.  In any arbitration pursuant to this
                    ---------------------
Section 15, the award of the arbitrators shall be final and binding upon the
parties and judgement upon the award may be entered in and enforced by any court
of competent jurisdiction.  The costs of the arbitration, including
administrative and the third arbitrator's fees but excluding the fees of the two
arbitrators selected by the parties, shall be shared equally by the parties. 
Each party shall bear its own costs and attorneys' and witness' fees and the
fees of the arbitrator that it has selected.  A disputed performance or
suspended performance pending the resolution of the arbitration must be
completed within thirty (30) days following the final decision of the
arbitrators or such other reasonable period as the arbitrators determine in a
written opinion.  Any arbitration subject to this Section 15 shall be completed,
to the extent reasonably possible in the light of all the circumstances, within
one (1) year from the date of the original filing of the demand for such
arbitration with the AAA.

               (vi)  Confidentiality.  All arbitration proceedings under this
                     ---------------
Section 15 shall be confidential and the arbitrators may issue appropriate
protective orders to safeguard the parties' Confidential Information.  Except as
required by law, neither party shall make (or instruct any arbitrator to make)
any public announcement with respect to the proceedings or decisions of any
arbitration without the prior written consent of the other party.  The existence
of any Unresolved Dispute, the submission of an Unresolved Dispute to
arbitration pursuant to this Section 15, and any award by the arbitrators, shall
be kept in confidence by the parties and the arbitrators, except as required in
connection with the enforcement of such award of implementation of such
decisions, as mutually agreed by the parties or as required by law.

               (vii)  Interim Relief.  This Section 15 shall not limit the
                      --------------
rights of any party to seek in any court of competent jurisdiction interim
relief, and only such interim relief, as may be needed to maintain the status
                                                                       ------
quo or otherwise protect the subject matter of the Unresolved Dispute and the
- ---
arbitration until the arbitrators shall have been appointed and shall have had
an opportunity to act.

          16.  Term and Termination.
               --------------------

          16.1 Unless this Agreement is terminated earlier pursuant to this
Section 16, this Agreement will remain in effect until the last to expire of any
Patent Rights licensed hereunder, or in the event that no patents issue, for
twenty (20) years from the Effective Date (the "Term").

          16.2 If Licensee judges at its sole discretion that the development or
commercialization of BCX-34 will fall in difficulties due to side effects, lack
of safety or other hazard, inadequate efficacy, failures to meet governmental
standards or any other causes found by Licensee any time during the Term of this
Agreement, Licensee may terminate this Agreement upon thirty (30) days prior
written notice.  If Licensee terminates this Agreement in accordance with this
Section 16.2, Licensee shall have no responsibility to 





                                       25





compensate Licensor for any damages in connection with such termination, and
Licensor shall not demand from Licensee any damages attributable to the
termination in accordance with this Section 16.2.

          16.3 If a party breaches a provision of this Agreement, the other
party may terminate this Agreement upon thirty (30) days prior written notice,
unless the breach is cured within such thirty (30) day period (the "Cure
Period").  In the event of a breach by Licensee under this Agreement which is
not cured within the Cure Period, Licensor shall, in its sole discretion, have
the option of terminating the exclusivity of Licensee's license hereunder in
respect of all Licensed Products or in respect of particular Licensed Products
or indications, instead of terminating this Agreement.  If Licensor wishes to
exercise the foregoing option, it shall so notify Licensee in writing prior to
the expiration of the Cure Period.

          16.4 In the event that Licensor permanently ceases all US development
and clinical trials of Licensed Products, Licensee shall have the right to
terminate this Agreement at any time thereafter upon thirty (30) days prior
written notice to Licensor; provided, however, that such termination shall not
be effective if Licensor during the thirty (30) day notice period gives Licensee
written notice of its existing development work or clinical trials or intention
to carry out the same.

          16.5 In the event of any termination or expiration of this Agreement,
any accrued rights to payment (including, but not limited to, royalties on sales
of Licensed Products made during the Term for which payment is not received
until after termination or expiration) and causes of action or remedies for
breach shall survive such termination.  In addition, Sections 8.10, 10.3, 10.4,
10.5, 11, 12, 13, 14, 15, 16.5, 16.6, 16.7, 16.8, 16.9, 17, 18 and 21 shall
survive termination of this Agreement.

          16.6 In the event of any early termination of this Agreement by
Licensor, all rights in relation to the Licensed Products, Licensed Compounds,
Derivative Compounds, Improvements and all Technology, Marks and Proprietary
Rights in relation thereto, shall revert to or be assigned to Licensor. 
Licensee hereby makes any assignments to Licensor necessary to achieve the
foregoing ownership position on such early termination [ * ], and assignments to
Licensor of all Licensee Improvements and Licensee's interest in any Joint
Improvements and any patents or patent applications covering such Improvements. 
Licensee agrees to assist Licensor in every proper way to evidence, record and
perfect the foregoing assignments and to apply for and obtain recordation of and
from time to time enforce, maintain and defend such rights, title and interests
in favor of Licensor.  Licensee agrees to execute any documentation or
confirmation reasonably requested by Licensor for such purposes.  Licensee shall
also promptly assign to Licensor any and all regulatory filings and approvals
held by Licensee in relation to the Licensed Products.  

          16.7 A sublicense will survive termination and continue according to
its terms provided that (i) it was properly granted, (ii) the continuation of
the sublicense after the termination of this Agreement receives Licensor's prior
written consent, (iii) Licensor will have no obligation thereunder, (iv) all the
restrictions and limitations of this Agreement shall apply to the Sublicensee as
though this Agreement continued in effect, (v) Licensor 





*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.



                                       26






shall receive all consideration due in connection with the sublicense and, in
any event, the payments to Licensor based on the sublicense and activity
thereunder shall be at least as great as they would have been had the Agreement
remained in effect and such actions been taken by Licensee and (vi) in addition
to any termination rights under the sublicense agreement, Licensor shall be
entitled to terminate such sublicense on the same basis as is provided herein
for termination of this Agreement.

          16.8 Neither party shall incur any liability whatsoever for any
damage, loss or expenses of any kind suffered or incurred by the other arising
from or incident to any termination of this Agreement (or any part thereof) by
such party which complies with the terms of the Agreement whether or not such
party is aware of any such damage, loss or expenses.

          16.9 Termination is not the sole remedy under this Agreement and,
whether or not termination is effected, all other remedies will remain
available.

          17.  INCIDENTAL AND CONSEQUENTIAL DAMAGES.  NEITHER PARTY WILL BE
               ------------------------------------
LIABLE UNDER ANY CONTRACT, NEGLIGENCE, STRICT LIABILITY OR OTHER THEORY FOR ANY
INCIDENTAL OR CONSEQUENTIAL DAMAGES WITH RESPECT TO ANY SUBJECT MATTER OF THIS
AGREEMENT EXCEPT A BREACH OF SECTION 12.

          18.  LIMITATION OF OBLIGATIONS AND LIABILITY.  LICENSOR WILL NOT BE
               ---------------------------------------
LIABLE WITH RESPECT TO ANY SUBJECT MATTER OF THIS AGREEMENT UNDER ANY CONTRACT,
NEGLIGENCE, STRICT LIABILITY OR OTHER THEORY FOR COST OF PROCUREMENT OF
SUBSTITUTE GOODS, SERVICES, TECHNOLOGY OR RIGHTS OR FOR ANY AMOUNTS AGGREGATING
IN EXCESS OF AMOUNTS PAID TO IT HEREUNDER IN THE TWELVE MONTH PERIOD BEFORE THE
CAUSE OF ACTION AROSE.

          19.  Independent Contractors.  The parties are independent contractors
               -----------------------
and not partners, joint venturers or otherwise affiliated and neither has any
right or authority to bind the other in any way.

          20.  [ * ].  
               -----

          21.  Miscellaneous.
               -------------

          21.1 Amendment and Waiver.  Except as otherwise expressly provided
               --------------------
herein, any provision of this Agreement may be amended and the observance of any





*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.



                                       27








provision of this Agreement may be waived (either generally or any particular
instance and either retroactively or prospectively) only with the written
consent of the parties.

          21.2 Governing Law and Interpretation.  This Agreement shall be
               --------------------------------
governed by, construed under and enforced under the laws of the State of New
York and the United States without regard to conflicts of laws provisions
thereof and without regard to the United Nations Convention on Contracts for the
International Sale of Goods.  All interpretation of the provisions and meaning
of this Agreement shall be in English.  Headings and captions are for conven-
ience only and are not to be used in the interpretation of this Agreement.

          21.3 Notices.  Notices under this Agreement shall be sufficient only
               -------
if personally delivered, delivered by a major commercial rapid delivery courier
service or mailed by certified or registered mail, return receipt requested to a
party at its addresses set forth below or if sent by telefax to the number
specified below and confirmed by one of the foregoing methods of delivery:  


If to Licensor:
- ---------------

          BioCryst Pharmaceuticals, Inc.
          2190 Parkway Lake Drive, 
          Birmingham, Alabama 35244, U.S.A.
          Attention: President
          Fax:  (205) 444-4640

With a copy to:
- ---------------

          Brobeck, Phleger & Harrison LLP
          1301 Avenue of the Americas
          New York, New York  10019, U.S.A.
          Attention: Richard R. Plumridge, Esq.
          Fax:  (212) 586-7878

If to Licensee:
- ---------------

          Torii Pharmaceutical Co., Ltd.
          3-4-1, Nihonbashi-Honcho
          Chuo-ku, Tokyo 103, Japan
          Attention:  General Manager, R&D Planning Dept.
          Fax:  81 (3) 5203-7333


If not received sooner, notice by mail shall be deemed received 5 days after
deposit in the U.S. or Japanese mails.




                                       28









          21.4 Entire Agreement.  This Agreement and the Exhibits attached
               ----------------
hereto supersede all proposals, oral or written, all negotiations,
conversations, or discussions between or among the parties relating to the
subject matter of this Agreement and all past dealing or industry custom.

          21.5 WARRANTY DISCLAIMER.  EXCEPT AS EXPRESSLY PROVIDED IN SECTIONS
               -------------------
10.1 AND 10.3 AND IN THE LAST SENTENCE OF SECTION 14.9, LICENSOR MAKES NO
WARRANTY WITH RESPECT TO ANY LICENSED PRODUCT, LICENSED COMPOUND, DERIVATIVE
COMPOUND, IMPROVEMENT, TECHNOLOGY, PROPRIETARY RIGHT, GOODS, SERVICES, RIGHTS OR
OTHER SUBJECT MATTER OF THIS AGREEMENT AND HEREBY DISCLAIMS WARRANTIES OF
MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND NONINFRINGEMENT WITH
RESPECT TO ANY AND ALL OF THE FOREGOING.

          21.6 Force Majeure.  Neither party hereto shall be responsible for any
               -------------
failure to perform its obligations under this Agreement (other than obligations
to pay money or obligations under Section 12 or 14) if such failure is caused by
acts of God, war, strikes, revolutions, lack or failure of transportation
facilities, laws or governmental regulations or other causes which are beyond
the reasonable control of such party.  Obligations hereunder, however, shall in
no event be excused but shall be suspended only until the cessation of any cause
of such failure.  In the event that such force majeure should obstruct
performance of this Agreement for more than six (6) months, the parties hereto
shall consult with each other to determine whether this Agreement should be
modified.  The party facing an event of force majeure shall use its best
endeavors in order to remedy that situation as well as to minimize its effects. 
A case of force majeure shall be notified to the other party by telefax within
five (5) days after its occurrence and shall be confirmed by a letter.

          21.7 Export Control.  Each party hereby agrees to comply with all
               --------------
export laws and restrictions and regulations of the Department of Commerce or
other United States or foreign agency or authority, and not to knowingly export,
or allow the export or re-export of any Proprietary Information, Licensed
Product, Licensed Compound, Derivative Compound, Technology or Improvement or
derivative of a Licensed Product or any direct product thereof in violation of
any such restrictions, laws or regulations, or, without all required licenses
and authorizations, to Afghanistan, the People's Republic of China or any Group
Q, S, W, Y or Z country specified in the then current Supplement No. 1 to
Section 770 of the U.S. Export Administration Regulations (or any successor
supplement or regulations).

          21.8 Severability.  If any provision of this Agreement is held
               ------------
illegal, invalid or unenforceable by a court of competent jurisdiction, that
provision will be limited or eliminated to the minimum extent necessary so that
this Agreement shall otherwise remain in full force and effect and enforceable.



                                       29







          21.9 Basis of Bargain.  Each party recognizes and agrees that the
               ----------------
warranty disclaimers and liability and remedy limitations in this Agreement are
material bargained for bases of this Agreement and that they have been taken
into account and reflected in determining the consideration to be given by each
party under this Agreement and in the decision by each party to enter into this
Agreement.

          IN WITNESS WHEREOF, the parties hereto have caused this LICENSE
AGREEMENT to be duly executed by their authorized representatives and delivered
in duplicate originals as of the Effective Date.

          TORII PHARMACEUTICAL CO., LTD.

   
          By:   /s/ Fumiki Tsukada
              ------------------------------------------------------------------
          Name:  Fumiki Tsukada
          Title: President
          May 31, 1996

          BIOCRYST PHARMACEUTICALS, INC.


          By:   /s/ Charles E. Bugg, Ph.D.
              ------------------------------------------------------------------
          Name:  Charles E. Bugg, Ph.D.    
          Title: Chairman, President & CEO     
    



                                     30







                                    EXHIBIT A
                                    ---------

                          LIST OF THIRD PARTY LICENSES
                          ----------------------------


The following compound and all pharmaceutical uses and compositions containing
the same is subject to an existing exclusive license in favor of Ciba-Geigy
Corporation, pursuant to a License Agreement between BioCryst Pharmaceuticals,
Inc. and Ciba-Geigy Corporation dated April 15, 1993:

         7-(Disubstituted Methyl)-4-OXO-3H,5H-Pyrrolo [3,2D]Pyrimidines







                                       31







                                    EXHIBIT B
                                    ---------

                             TECHNICAL DOCUMENTATION
                             -----------------------



I.   Bulk

     1.   Definition of structure
          a.   Method of synthesis
          b.   Elemental analysis
          c.   UV, IR, NMR, MS and other tests

     2.   Physicochemical properties
          a.   Thermal analysis
          b.   Crystalline polymorphism
          c.   Analogues and methods of isolation
          d.   Forced decomposition products

     3.   Standards and test methods
          a.   Description (color, pH, melting point, etc.)
          b.   Reference standards
          c.   Loss on drying (test methods and the results)
          d.   Residue on ignition (test methods and the results)
          e.   Identification (test methods and the results)
          f.   Water determination (test methods and the results)
          g.   Purity (test methods and the results)

     4.   Stability
          a.   Test methods and the results

II.  Final Dosage Form

     1.   Test methods and the results concerning stability

III. Absorption, Distribution, Metabolism and Excretion Studies

     1.   Single-dose oral study in rats (bulk drug and isotope-labeled drug)
          a.   Methods of assay (concentration of bulk drug in the blood,
               organs, and urine)
     2.   In vitro studies
          a.   Protein binding in blood plasma (rat and human)
     3.   Pharmacokinetics, Metabolism, and Tissue Distribution of [14C]BCX-34
          in the Rat Following Intravenous Administration (WIL-196010)



                                       32








IV.  General Systemic Toxicity

     1.   A 6-Month Oral (Gavage) Toxicity Study of BCX-34 in Rats (WIL-196013)
     2.   A-6 Month Oral (Capsule) Toxicity Study of BCX-34 in Dogs (WIL-196014)

V.   Developmental and Reproductive Toxicity

     1.   A Study of Fertility and Early Embryonic Development to Implantation
          of BCX-34 in Rats (WIL-196015)
     2.   A Dose Range-Finding Developmental Toxicity Study of BCX-34 in Rats
          (WIL-196016)
     3.   A Dose Range-Finding Developmental Toxicity Study of BCX-34 in Rabbits
          (WIL-196018)
     4.   A Developmental Toxicity Study of BCX-34 in Rats (WIL-196017)
     5.   A Developmental Toxicity Study of BCX-34 in Rabbits (WIL-196019)

VI.  Genetic Toxicity Studies

     1.   Salmonella/Mammalian-Microsome Plate Incorporation Mutagenicity Assay
          (Ames Test)
     2.   L5178Y/TK+ Mouse Lymphoma Mutagenesis Assay with a Confirmatory Assay
                   -
     3.   Micronucleus Cytogenetic Assay in Mice
     4.   Chromosome Aberration Assay in Chinese Hamster Ovary Cells
     5.   Protocol no. G94B024.332: in vitro mammalian cytogenetic test (final
          report)

VII. Clinical

     1.   Investigators' Brochure for BCX-34 Development Program, 1995
     2.   Phase I Study of Oral BCX-34 in Patients with T-cell Malignancies:
          Protocol no. 94-010



                                       33







                                    EXHIBIT C
                                    ---------

                                      [ * ]


                                      [ * ]


                                      [ % ]


*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.






                                       34




                                    EXHIBIT D
                                    ---------

                            STOCK PURCHASE AGREEMENT
                            ------------------------

                               (See Exhibit 10.2)







                                       35





   
                                  Exhibit 10.2

                            STOCK PURCHASE AGREEMENT

                                 by and between

                         BIOCRYST PHARMACEUTICALS, INC.

                                       and

                         TORII PHARMACEUTICAL CO., LTD.

                               dated May 31, 1996



                           $1,500,000 of Common Stock
    










                                TABLE OF CONTENTS
                                -----------------


                                                                            Page
                                                                            ----

1.   Sale of Common Stock . . . . . . . . . . . . . . . . . . . . . . . . .    1
     1.1  Sale and Issuance . . . . . . . . . . . . . . . . . . . . . . . .    1
     1.2  Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    1

2.   Representations and Warranties of the Company  . . . . . . . . . . . .    2
     2.1  Organization, Good Standing and Qualification . . . . . . . . . .    2
     2.2  Authorization . . . . . . . . . . . . . . . . . . . . . . . . . .    2
     2.3  Valid Issuance of Shares  . . . . . . . . . . . . . . . . . . . .    2
     2.4  Governmental Consents . . . . . . . . . . . . . . . . . . . . . .    2
     2.5  Litigation  . . . . . . . . . . . . . . . . . . . . . . . . . . .    2
     2.6  Compliance with Other Instruments . . . . . . . . . . . . . . . .    2
     2.7  License Agreement . . . . . . . . . . . . . . . . . . . . . . . .    3

3.   Representations and Warranties of the Investor . . . . . . . . . . . .    3
     3.1  Authorization . . . . . . . . . . . . . . . . . . . . . . . . . .    3
     3.2  Governmental Consents . . . . . . . . . . . . . . . . . . . . . .    3
     3.3  Purchase Entirely for Own Account . . . . . . . . . . . . . . . .    3
     3.4  Investment Experience . . . . . . . . . . . . . . . . . . . . . .    3
     3.5  Accredited Investor . . . . . . . . . . . . . . . . . . . . . . .    3
     3.6  Disclosure of Information . . . . . . . . . . . . . . . . . . . .    4
     3.7  Foreign Investor Representations  . . . . . . . . . . . . . . . .    4
     3.8  Legends . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    4

4.   Covenants of the Investor  . . . . . . . . . . . . . . . . . . . . . .    4
     4.1  Standstill  . . . . . . . . . . . . . . . . . . . . . . . . . . .    5
     4.2  Restrictions on Acts in Concert with Others . . . . . . . . . . .    5
     4.3  Restrictions on Transfer of Shares  . . . . . . . . . . . . . . .    5
     4.4  Company Right of First Refusal  . . . . . . . . . . . . . . . . .    5
     4.5  Dissenter's Rights  . . . . . . . . . . . . . . . . . . . . . . .    6
     4.6  Voting of Shares  . . . . . . . . . . . . . . . . . . . . . . . .    6
     4.7  Affiliates also Bound . . . . . . . . . . . . . . . . . . . . . .    6

5.   Conditions of the Investor's Obligations at Closing  . . . . . . . . .    7
     5.1  Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    7
     5.2  Representations and Warranties  . . . . . . . . . . . . . . . . .    7
     5.3  License Agreement . . . . . . . . . . . . . . . . . . . . . . . .    7

6.   Conditions of the Company's Obligations at Closing . . . . . . . . . .    7
     6.1  Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    7
     6.2  Representations and Warranties  . . . . . . . . . . . . . . . . .    7




                                        i





                                                                            Page
                                                                            ----

     6.3  Payment of Purchase Price . . . . . . . . . . . . . . . . . . . .    7
     6.4  Qualifications  . . . . . . . . . . . . . . . . . . . . . . . . .    7
     6.5  License Agreement . . . . . . . . . . . . . . . . . . . . . . . .    7

7.   Miscellaneous  . . . . . . . . . . . . . . . . . . . . . . . . . . . .    7
     7.1  Successors and Assigns  . . . . . . . . . . . . . . . . . . . . .    7
     7.2  Governing Law; Disputes . . . . . . . . . . . . . . . . . . . . .    7
     7.3  Counterparts  . . . . . . . . . . . . . . . . . . . . . . . . . .    8
     7.4  Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . .    8
     7.5  Attorneys' Fees . . . . . . . . . . . . . . . . . . . . . . . . .    8
     7.6  Expenses  . . . . . . . . . . . . . . . . . . . . . . . . . . . .    9
     7.7  Finder's Fee  . . . . . . . . . . . . . . . . . . . . . . . . . .    9
     7.8  Aggregation of Stock  . . . . . . . . . . . . . . . . . . . . . .    9
     7.9  Severability  . . . . . . . . . . . . . . . . . . . . . . . . . .    9
     7.10 Entire Agreement  . . . . . . . . . . . . . . . . . . . . . . . .    9
     7.11 Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . .    9






                                       ii











                         BIOCRYST PHARMACEUTICALS, INC.

                            STOCK PURCHASE AGREEMENT


               THIS STOCK PURCHASE AGREEMENT is made as of the 31st day of May,
1996, by and between BioCryst Pharmaceuticals Inc., a Delaware corporation
having its principal executive offices at 2190 Parkway Lake Drive, Birmingham,
Alabama 35244 (the "Company"), and Torii Pharmaceutical Co., Ltd., a Japanese
corporation having its principal executive offices at 3-4-1, Nihonbashi-Honcho,
Chuo-Ku, Tokyo 103, Japan (the "Investor").

               WHEREAS, the Investor desires to make an equity investment in the
Company through the purchase of newly issued shares of common stock of the
Company, $.01 per share par value ("Common Stock"); and

               WHEREAS, the Investor further desires to collaborate with the
Company and to obtain from the Company certain rights to the Company's
technologies and know-how in Japan pursuant to the terms of that certain License
Agreement of even date herewith (the "License Agreement").

               THE PARTIES HEREBY AGREE AS FOLLOWS:

               1.   Sale of Common Stock.
                    --------------------

               1.1  Sale and Issuance.  Subject to the terms and conditions of
                    -----------------
this Agreement, the Investor agrees to purchase at the Closing (as defined in
Section 1.2) and the Company agrees to sell and issue to the Investor at such
Closing, at a purchase price per share determined as set forth below, that
number of shares (rounded down to the nearest whole share) of the Company's
Common Stock that is equivalent in value to $1,500,000 (United States Dollars,
"USD").  The shares of Common Stock to be sold hereunder are collectively
referred to as the "Shares".  The per share purchase price (the "Purchase
Price") to be paid by the Investor for the Shares to be purchased from the
Company at the Closing shall be [ * ].  The number of Shares to be issued to the
Investor at the Closing shall be equal to $1,500,000 divided by the Purchase
Price rounded down to the nearest Share, unless otherwise agreed by the parties
in advance of the Closing.

               1.2  Closing.  The purchase and sale of the Shares shall take
                    -------
place at the executive offices of the Investor on May 31, 1996, or at such other
time or other place as the Company and the Investor mutually agree upon orally
or in writing (which time and place is designated as the "Closing").  At the
Closing the Company shall deliver to the Investor a certificate representing the
Shares purchased by the Investor against delivery to the Company by the Investor
of a wire transfer according to instructions provided by the Company in
immediately available funds in the amount $1,500,000 (USD).






*    Indicates material that has been omitted and for which confidential
     treatment has been requested. All such omitted material has been filed
     separately with the Commission pursuant to Rule 24b-2.








               2.   Representations and Warranties of the Company.  The Company
                    ---------------------------------------------
hereby represents and warrants to the Investor that:

               2.1  Organization, Good Standing and Qualification.  The Company
                    ---------------------------------------------
is a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware.

               2.2  Authorization.  All corporate action on the part of the
                    -------------
Company, its officers, directors and shareholders necessary for the
authorization, execution and delivery of this Agreement, the performance of all
obligations of the Company hereunder and thereunder and the authorization,
issuance and delivery of the Shares being sold hereunder has been taken or will
be taken prior to the Closing, and this Agreement constitutes a valid and
legally binding obligation of the Company, enforceable in accordance with its
terms, except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, and other laws of general application affecting
enforcement of creditors' rights generally and (ii) as limited by laws relating
to the availability of specific performance, injunctive relief, or other
equitable remedies.

               2.3  Valid Issuance of Shares.  The Shares which are being
                    ------------------------
purchased by the Investor hereunder, when issued, sold and delivered in
accordance with the terms hereof for the consideration expressed herein, will be
duly and validly issued, fully paid and nonassessable and, based in part upon
the representations of the Investor in this Agreement, will be issued in
compliance with all applicable federal and state securities laws.

               2.4  Governmental Consents.  No consent, approval, order or
                    ---------------------
authorization of, or registration, qualification, designation, declaration or
filing with, any federal, state or local governmental authority on the part of
the Company is required in connection with the consummation of the transactions
contemplated by this Agreement, except for post-Closing filings as may be
required under applicable state securities laws.

               2.5  Litigation.  Other than the dispute between the Company and
                    ----------
Warner-Lambert, which does not relate to any Licensed Compound, there is no
action, suit, proceeding or investigation pending or currently threatened
against the Company.  The Company is not a party or subject to the provisions of
any order, writ, injunction, judgment or decree of any court or government
agency or instrumentality.  There is no action, suit, proceeding or
investigation by the Company currently pending or which the Company intends to
initiate.

               2.6  Compliance with Other Instruments.  The Company is not in
                    ---------------------------------
violation or default of any provisions of its Composite Certificate of
Incorporation or Bylaws or of any instrument, judgment, order, writ, decree or
contract to which it is a party or by which it is bound or, to its knowledge, of
any provision of federal or state statute, rule or regulation applicable to the
Company.  The execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will not result in any such
violation or be in conflict with or constitute, with or without the passage of
time and giving of notice, either a default under any such provision,
instrument, judgment, order, writ, 




                                        2






decree or contract or an event which results in the creation of any lien, charge
or encumbrance upon any assets of the Company or the suspension, revocation,
impairment, forfeiture, or nonrenewal of any material permit, license,
authorization, or approval applicable to the Company, its business or operations
or any of its assets or properties.

               2.7  License Agreement.  The Company has full power and authority
                    -----------------
to enter into the License Agreement and to grant the Licenses granted to
Investor thereunder.

               3.   Representations and Warranties of the Investor.  The
                    ----------------------------------------------
Investor hereby represents and warrants to the Company that:

               3.1  Authorization.  The Investor represents that it has full
                    -------------
power and authority to enter into this Agreement.  This Agreement constitutes
its valid and legally binding obligation, enforceable in accordance with its
terms, except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, and other laws of general application affecting
enforcement of creditors' rights generally and (ii) as limited by laws relating
to the availability of specific performance, injunctive relief, or other
equitable remedies

               3.2  Governmental Consents.  With the exception of a report to be
                    ---------------------
filed by the Investor subsequent to the Closing with the Japanese Ministry of
Finance, no consent, approval, order or authorization of, or notification,
registration, qualification, designation, declaration or filing with any United
States or Japanese governmental authority on the part of the Investor is
required in connection with the consummation of the transactions contemplated by
this Agreement so far as the number of Shares acquired by the Investor
constitute not more than five (5) percent of all the issued Common Stock of the
Company.

               3.3  Purchase Entirely for Own Account.  This Agreement is made
                    ---------------------------------
with the Investor in reliance upon the Investor's representation to the Company,
which by the Investor's execution of this Agreement the Investor hereby
confirms, that the Shares to be received by the Investor will be acquired for
investment for the Investor's own account, not as a nominee or agent, and not
with a view to the resale or distribution of any part thereof, and that such
Investor has no present intention of selling, granting any participation in, or
otherwise distributing the same.  By executing this Agreement, the Investor
further represents that it does not have any contract, undertaking, agreement or
arrangement with any person to sell, transfer or grant participations to such
person or to any third person, with respect to the Shares.

               3.4  Investment Experience.  The Investor is an investor in
                    ---------------------
securities of companies in Japan and/or countries outside of Japan in the
development stage and acknowledges that it is able to fend for itself, can bear
the economic risk of its investment and has such knowledge and experience in
financial or business matters such that it is capable of evaluating the merits
and risks of its investment in the Shares.




                                        3







               3.5  Accredited Investor.  The Investor is an "accredited
                    -------------------
investor" within the meaning of SEC Rule 501 of Regulation D of the Securities
Act of 1933, as amended (the "Act"), as presently in effect.

               3.6  Disclosure of Information.  The Investor acknowledges that
                    -------------------------
it has received all the information it considers necessary or appropriate for
deciding whether to purchase the Shares and that it has had an opportunity to
ask questions and receive answers from the Company regarding the terms and
conditions of the issuance of the Shares.  The foregoing, however, does not
limit or modify the representations and warranties of the Company in Section 2
of this Agreement or the right of the Investor to rely thereon.

               3.7  Foreign Investor Representations.
                    --------------------------------

               (a) The Investor acknowledges that the Shares it is purchasing
are characterized as "restricted securities" under federal securities laws
inasmuch as they are being acquired from the Company in a transaction not
involving a public offering and under such laws and applicable regulations such
securities may be resold without restriction in the United States or to United
States citizens, residents or nationals or entities organized or chartered under
the laws of the United States only in certain limited circumstances.

               (b) The Investor further represents to the Company that its
principal place of business is at the address set forth in the first paragraph
of this Agreement, and acknowledges and agrees that the Shares will not be
reoffered or resold in the United States or to United States citizens, residents
or nationals or entities organized or chartered under the laws of the United
States in the absence of (i) compliance with the registration provisions of the
Act, or (ii) a favorable opinion of counsel satisfactory to the Company that
such Shares are being reoffered or resold pursuant to an exemption from the
registration requirements of the Act or any applicable securities laws of any
state of the United States.

               3.8  Legends.  The Investor understands that the certificates
                    -------
evidencing the Shares may bear the following legends:

               (a)  "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT") AND MAY NOT BE TRANSFERRED TO CITIZENS, RESIDENTS OR NATIONALS OR
ENTITIES ORGANIZED OR CHARTERED UNDER THE LAWS OF THE UNITED STATES OF AMERICA,
UNLESS THE ISSUER HAS RECEIVED AN OPINION OF COUNSEL, SATISFACTORY TO THE
ISSUER, THAT SUCH TRANSFER WILL NOT BE IN VIOLATION OF THE ACT OR ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES.

               (b)  "THESE SECURITIES ARE SUBJECT TO A MARKET STAND-OFF
AGREEMENT CONTAINED IN A STOCK PURCHASE AGREEMENT, COPIES OF WHICH MAY BE
OBTAINED, UPON WRITTEN REQUEST, FROM THE SECRETARY OF THE COMPANY."



                                        4







               4.   Covenants of the Investor.
                    -------------------------

               4.1  Standstill.
                    ----------

               (a)  The Investor agrees that it shall not for a period of five
(5) years from the Closing, except with the Company's prior written consent,
acquire beneficial ownership of any voting securities of the Company, any
securities convertible into or exchangeable for such securities, or any other
right to acquire any such securities, or authorize or make a tender, exchange or
other offer without the prior written consent of the Company, if the effect of
such acquisition would be to increase the voting power of all voting securities
of the Company then owned by the Investor or which the Investor has the right to
acquire to more than ten percent (10%) of the total voting power of the Company.

               (b)  The term "voting securities" shall mean any securities
issued by the Company having the ordinary power to vote in the election of
directors of the Company (other than securities having such power only upon the
occurrence of a contingency), and "total voting power" shall mean the number of
votes which may be cast in the election of directors of the Company if all such
securities entitled to vote in the election of directors were present at a
meeting therefor and voted.

               4.2  Restrictions on Acts in Concert with Others.  Without the
                    -------------------------------------------
Company's prior written consent, the Investor agrees that it shall not for a
period of five (5) years from the Closing (a) take any action alone or in
concert with any other third party (including without limitation entering into a
partnership or voting trust) to affect voting control of the Company or (b)
solicit proxies with respect to the Company's voting securities.  

               4.3  Restrictions on Transfer of Shares.  (a)  In addition to the
                    ----------------------------------
limitations set forth in Section 3.7 hereof, for a period of five (5) years from
the Closing Date (the "Five Year Lock-up Period"), the Investor shall not,
without the consent of the Company, directly or indirectly, sell, offer to sell,
contract to sell (including without limitation, any short sale), grant any
option to purchase or otherwise transfer or dispose of any of the Shares;
provided, however, that the Shares will continue to be subject to such
restrictions at the end of the Five Year Lock-up Period to the same extent and
for the same time period as any directors or officers of the Company are so
similarly restricted.  In order to enforce the foregoing covenant, the Company
may impose stop transfer instructions with respect to the Shares held by the
Investor until the end of the Five Year Lock-Up Period.

               (b)  In addition to the foregoing, in no event will the Investor,
without the prior written consent of the Company (which will not be unreasonably
withheld) transfer Shares in transactions (i) which, directly or indirectly,
results, to the best knowledge of the Investor, in any single person or group
acting in concert owning or having the right to acquire voting securities with
aggregate voting power of five percent (5%) or more of the total voting power of
the Company or (ii) where the transferee or acquiror does not agree to be bound
by the terms and conditions of this Agreement.




                                        5







               4.4  Company Right of First Refusal.  After the end of the Five
                    ------------------------------
Year Lock-Up Period and any extension thereof pursuant to Section 4.3(a), in the
event the Investor desires to transfer any Shares at any time, it shall first
deliver a notice (the "Investor Offer Notice") to the Company which shall
specify the number of Shares which the Investor desires to sell or transfer, the
approximate number of the proposed purchasers or transferees, the name(s) of the
proposed purchasers or transferees if known to the Investor, the price per share
at which the Investor desires to sell or transfer the Shares (the "Transfer
Price") and the other material terms upon which such disposition is proposed to
be made.  The Company shall, by notice given by the Company to the Investor
within 5 business days after receipt of the Investor Offer Notice, indicate its
intention to purchase all, or any portion, of the Shares specified in the
Investor Offer Notice for cash at the per share Transfer Price, provided, within
30 calendar days after such notice of exercise by the Company, the Company shall
provide the Investor with evidence satisfactory to the Investor (by the written
commitment letter subject only to customary representations, diligence and
documentation, letter of credit or otherwise) of its ability to finance the
purchase of the Shares.  If the Company exercises its right of first refusal
hereunder, the closing of the purchase of the voting securities with respect to
which such right has been exercised will take place within 60 calendar days
after the Company gives notice of such exercise, which period of time shall be
extended, if required, in order to comply with applicable laws and regulations. 
Upon exercise of the right of first refusal, the Company and the Investor shall
be legally obligated to consummate the purchase contemplated thereby and shall
use their best efforts to secure any approvals required in connection therewith.
To the extent the Company does not exercise its right of first refusal hereunder
as specified herein, the Investor shall be free to sell any voting securities
specified in the Investor Offer Notice and not elected to be purchased by the
Company on terms no less favorable to the Investor than the terms specified in
the Investor Offer Notice.  In the event the Investor does not sell the voting
securities specified in the Investor Offer Notice within 180 days after the date
of the Investor Offer Notice, it shall not thereafter sell the voting securities
without first offering them to the Company in the manner specified above.

               4.5  Dissenter's Rights.  The Investor further agrees that, with
                    ------------------
regard to a proposed acquisition of the Company, the Investor agrees not to
exercise any appraisal or similar statutory dissenters' rights with regard to
such transaction, provided that such transaction has been approved by the
Company's Board of Directors and by the holders of a majority of the Company's
outstanding voting securities.

               4.6  Voting of Shares.  The Investor agrees that on all matters
                    ----------------
for which holders of Common Stock are eligible to vote it shall, so long as it
owns its Shares either directly or indirectly, vote (or cause to vote) all of
its Shares in accordance with the recommendation of the majority of the Board of
Directors of the Company.

               4.7  Affiliates also Bound.  Any reference to the Investor in any
                    ---------------------
of this Section 4 shall be deemed to include its Affiliates (as defined in
Section 1.1 of the Licensing Agreement).  The Investor agrees to take any action
necessary, including instructing its representatives on the board of directors
of its Affiliates to take any action so necessary, to ensure that its Affiliates
adhere to the restrictions imposed under this Section 4; provided, however, that
nothing in this Section 4 shall restrict the rights of the Investor and its
Affiliates to transfer Shares to each other.




                                        6








               5.   Conditions of the Investor's Obligations at Closing.  The
                    ---------------------------------------------------
obligations of the Investor under Subsection 1.1 of this Agreement are subject
to the fulfillment on or before the Closing of each of the following conditions:

               5.1  Closing. The Closing shall have occurred on or before June
                    -------
1st, 1996.

               5.2  Representations and Warranties.  The representations and
                    ------------------------------
warranties of the Company contained in Section 2 shall be true on and as of the
Closing with the same effect as though such representations and warranties had
been made on and as of the date of such Closing.

               5.3  License Agreement.  The License Agreement shall have been
                    -----------------
executed and delivered by the parties.

               6.   Conditions of the Company's Obligations at Closing.  The
                    --------------------------------------------------
obligations of the Company to the Investor under this Agreement are subject to
the fulfillment on or before the Closing of each of the following conditions by
the Investor:

               6.1  Closing. The Closing shall have occurred on or before June
                    -------
1st, 1996.

               6.2  Representations and Warranties.  The representations and
                    ------------------------------
warranties of the Investor contained in Section 3 shall be true on and as of the
Closing with the same effect as though such representations and warranties had
been made on and as of the Closing.

               6.3  Payment of Purchase Price.  The Investor shall have
                    -------------------------
delivered the Purchase Price for each of the Shares as specified in Section 1.

               6.4  Qualifications.  All authorizations, approvals or permits,
                    --------------
if any, of any governmental authority or regulatory body of Japan or the United
States or of any state that are required in connection with the lawful issuance
and sale of the Shares pursuant to this Agreement shall be duly obtained and
effective as of the Closing.

               6.5  License Agreement.  The License Agreement shall have been
                    -----------------
executed and delivered by the parties, and the Investor shall have paid all
amounts due upon execution thereof.

               7.   Miscellaneous.
                    -------------

               7.1  Successors and Assigns.  The terms and conditions of this
                    ----------------------
Agreement shall inure to the benefit of and be binding upon the respective
successors and assigns of the parties.  Nothing in this Agreement, express or
implied, is intended to confer upon any party other than the parties hereto or
their respective successors and assigns any rights, remedies, 




                                        7



obligations, or liabilities under or by reason of this Agreement, except as
expressly provided in this Agreement.

               7.2  Governing Law; Disputes.  This Agreement shall be governed
                    -----------------------
by and construed under the laws of the State of New York without regard to
conflicts of law principles.  All interpretations of the provisions and meaning
of this Agreement shall be in English.  In the event of any dispute between the
parties, such dispute shall be settled in accordance with Section 15 of the
License Agreement.  Service may be effected by compliance with the notice
provisions of paragraph 7.4 of this Agreement, or by any other means permitted
by law.

               7.3  Counterparts.  This Agreement may be executed in two or more
                    ------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.

               7.4  Notices.  Unless otherwise provided, notices under this
                    -------
Agreement shall be sufficient only if personally delivered, delivered by a major
commercial rapid delivery courier service or mailed by certified or registered
mail, return receipt requested, to a party at its addresses set forth below or
if sent by telefax to the number specified below and confirmed by one of the
foregoing methods of delivery:

If to Company:
- -------------

               BioCryst Pharmaceuticals, Inc.
               2190 Parkway Lake Drive, 
               Birmingham, Alabama 35244, U.S.A.
               Attention:  President
               Fax:  205-444-4640

With a copy to:
- --------------

               Brobeck, Phleger & Harrison LLP
               1301 Avenue of the Americas
               New York, New York  10019, U.S.A.
               Attention: Richard R. Plumridge, Esq.
               Fax:  212-586-7878

If to the Investor:
- ------------------

               Torii Pharmaceutical Co., Ltd.
               3-4-1, Nihonbashi-Honcho
               Chuo-Ku
               Tokyo 103, Japan
               Fax:  81 (3) 5203-7334



                                        8







               7.5  Attorneys' Fees.  If any action at law or in equity is
                    ---------------
necessary to enforce or interpret the terms of this Agreement, the prevailing
party shall be entitled to reasonable attorneys' fees, costs and necessary
disbursements in addition to any other relief to which such party may be
entitled.

               7.6  Expenses.  Each party hereto shall bear its legal and other
                    --------
expenses incurred in connection with the negotiation, execution, delivery and
performance of this Agreement.

               7.7  Finder's Fee.  Each party represents that, with the
                    ------------
exception of the Company's arrangements with Dillon, Read & Co. Inc., it neither
is nor will be obligated for any finders' fee or commission in connection with
this transaction.  The Investor agrees to indemnify and to hold harmless the
Company from any liability for any commission or compensation in the nature of a
finders' fee (and the costs and expenses of defending against such liability or
asserted liability) for which the Investor or any of its officers, partners,
employees, or representatives is responsible.  The Company agrees to indemnify
and hold harmless the Investor from any liability for any commission or
compensation in the nature of a finders' fee (and the costs and expenses of
defending against such liability or asserted liability) for which the Company or
any of its officers, employees or representatives is responsible.

               7.8  Aggregation of Stock.  For the purpose of determining the
                    --------------------
Investor's rights under this Agreement, all shares of Common Stock held by the
Investor either directly or indirectly shall be aggregated together.

               7.9  Severability.  If one or more provisions of this Agreement
                    ------------
are held to be unenforceable under applicable law, such provision shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms.

               7.10 Entire Agreement.  This Agreement and the License Agreement
                    ----------------
supersede all proposals, oral or written, all negotiating conversations, or
discussions between or among the parties relating to the subject matter of this
Agreement and all past dealing or industry custom.

               7.11 Defined Terms.  Capitalized terms used herein and not
                    -------------
otherwise defined shall have the meanings assigned to such terms in the License
Agreement.



                                        9





               IN WITNESS WHEREOF, the parties have executed this Stock Purchase
Agreement as of the date first above written.


  BIOCRYST PHARMACEUTICALS, INC.


   
                                   By    /s/  Charles E. Bugg
                                       ------------------------------------
                                       Name:   Charles E. Bugg, Ph.D.
                                       Title:  Chairman, President & CEO
                                 
                                 
                                 
                                   TORII PHARMACEUTICAL CO., LTD.
                                 
                                 
                                 
                                   By    /s/  F. Tsukada
                                       ------------------------------------
                                       Name:   Fumiki Tsukada
                                       Title:  President
                                       May 31, 1996
    


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