NOTE ISSUANCE AGREEMENT

THIS NOTE ISSUANCE AGREEMENT (this Agreement), dated as of December 23, 2005, is made by and between INTERMUNE, INC., a Delaware corporation (together with its permitted successors and assigns, called InterMune), and TARGANTA THERAPEUTICS CORPORATION, a Delaware corporation (the Purchaser).

A. Purchaser and InterMune are parties to that certain Asset Purchase Agreement (defined below) pursuant to which Purchaser is to buy all of InterMunes right, title, and interest in a certain product commonly referred to as Oritavancin. In consideration thereof, Purchaser is to pay the purchase price in installments as and when set forth in the Asset Purchase Agreement.

B. Purchaser has requested that it be permitted to issue a note in the form attached hereto, the principal amount of which shall change on the date each such installment of the purchase price is payable to InterMune and upon the occurrence of other events. InterMune is willing to accept such note subject to the terms and conditions set forth in this Agreement.

WHEREFORE, for fair and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows:

ARTICLE I

DEFINITIONS

SECTION 1.01 Certain Defined Terms. Capitalized terms shall have the meanings assigned to them in this Agreement. In addition, as used in this Agreement, the following terms shall have the following meanings:

Acquisition Documents means this Agreement, the Collateral Documents, the Acquisition Note, and all other certificates, documents, agreements and instruments delivered to InterMune under or in connection with any of the foregoing.

Acquisition Installment Payment means any installments of the purchase price payable by Purchaser for the purchase of the Product as set forth in the Asset Purchase Agreement.

Acquisition Note has the meaning set forth in Section 2.01(b).

Action or Proceeding means any action, suit, proceeding, arbitration, Order, hearing, assessment with respect to fines or penalties or litigation (whether civil, criminal, administrative, investigative or informal) commenced, brought, conducted or heard by or before any Governmental or Regulatory Authority.

Affiliate means, with respect to any Person, any other Person which controls, is controlled by or is under common control with such Person. A Person shall be regarded as in control of another Person if it owns or controls, directly or indirectly, (i) in the case of corporate entities at least fifty percent (50%) (or the maximum ownership interest permitted by law) of the equity securities in the subject entity entitled to vote in the election of directors and, (ii) in the case of an entity that is not a corporation, at least fifty percent (50%) (or the maximum

ownership interest permitted by law) of the equity securities or other ownership interests with the power to direct the management and policies of such subject entity or entitled to elect the corresponding management authority, or such other relationship as, in fact, constitutes actual control.

Agreement has the meaning set forth in the recitals hereto.

Asset Purchase Agreement means that certain Asset Purchase Agreement, dated as of the date hereof, by and between InterMune and Purchaser.

Business Day means a day of the year on which commercial banks are not required or authorized by law to close in San Francisco, California.

Canadian Subsidiary has the meaning set forth in Section 4.01(m)(ii).

Certificate of Incorporation means the certificate of incorporation, as amended and restated from time to time, of Purchaser as on file with the Secretary of State of the State of Delaware.

Closing Date has the meaning set forth in Section 3.01.

Collateral means the property acquired by Purchaser from InterMune pursuant to the Asset Purchase Agreement and described in the Collateral Documents, and all other property now existing or hereafter acquired that may at any time be or become subject to a Lien in favor of InterMune pursuant to the Collateral Documents securing the payment and performance of the Obligations under the Acquisition Note.

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