EMPLOYMENT AGREEMENT



        This Employment Agreement dated for reference December 18, 2001.



BETWEEN:



          QLT INC., having an address of 887 Great Northern Way, Vancouver,

          British Columbia, V5T 4T5,



          ("QLT" or the "COMPANY")



AND:



          PAUL J. HASTINGS, having an address of 61 Hartford, San Francisco,

          California, U.S.A, 94114,



          ("MR. HASTINGS")



WHEREAS:



A.   QLT is a world leader in the development and commercialization of

     proprietary pharmaceutical products for use in photodynamic therapy, a

     field of medicine utilizing light-activated drugs in the treatment of

     disease and has other active development programs ongoing in areas outside

     of photodynamic therapy;



B.   QLT wishes to offer to Mr. Hastings, and Mr. Hastings wishes to accept,

     employment with QLT as President and Chief Executive Officer of QLT;



C.   QLT and Mr. Hastings wish to enter into this Agreement to set out the terms

     and conditions of Mr. Hastings' employment with QLT; and



D.   The employment of Mr. Hastings by QLT is subject to Mr. Hastings obtaining

     and maintaining the permission of Canada Immigration to work in Canada in

     this position. QLT will reimburse Mr. Hastings for the costs associated

     with obtaining employment and permanent resident status in Canada.





     NOW THEREFORE in consideration of $10.00, the promises made by each party

to the other as set out in this Agreement and other good and valuable

consideration, the receipt and sufficiency of which the parties acknowledge and

agree, QLT and Mr. Hastings agree as follows:



1.   POSITION AND DUTIES



1.1  POSITION - Effective the 17th day of February, 2002 (the "COMMENCEMENT

     DATE"), QLT will employ Mr. Hastings in the position of President and Chief

     Executive Officer, and Mr. Hastings agrees to accept employment with QLT in

     this position, subject to the terms and conditions of this Agreement.



1.2  DUTIES, REPORTING AND EFFORTS - In the performance of his duties as

     President and Chief Executive Officer, Mr. Hastings will:





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     (a)  OVERALL RESPONSIBILITIES - Have the responsibilities commensurate with

          the position of President and Chief Executive Officer, including those

          set out in SCHEDULE A to this Agreement and with the goal of achieving

          QLT's overall long-term strategic objectives.



     (b)  REPORT - Report, as and when required, to the Board of Directors of

          QLT (the "BOARD").



     (c)  BEST EFFORTS - Use his best efforts, industry and knowledge to improve

          and increase QLT's business, to comply with all of QLT's rules,

          regulations, policies and procedures, as established from time to time

          and to ensure that QLT is at all times in compliance with applicable

          provincial, state, federal and other governing statutes, policies and

          regulations.



     (d)  WORKING DAY - Devote the whole of his working day attention and

          energies to the business and affairs of QLT.



2.   COMPENSATION



2.1  ANNUAL COMPENSATION - In return for his services under this Agreement, QLT

     agrees to pay or otherwise provide the following total annual compensation

     to Mr. Hastings:



     (a)  BASE SALARY - A base annual salary in the amount of US$500,000, in 24

          equal installments payable semi-monthly in arrears, subject to

          periodic reviews and increases at the discretion of the Board.



     (b)  BENEFIT PLANS - Coverage for Mr. Hastings and his eligible dependents

          under any employee benefit plans provided by/through QLT to its

          employees, subject to:



          I.   each plan's terms for eligibility,



          II.  Mr. Hastings taking the necessary steps to ensure effective

               enrollment or registration under each plan, and



          III. deductions of applicable employee contributions for the premiums

               of each plan.



          As at the date of this Agreement, the employee benefit plans provided

          by/through QLT to its employees include life insurance, accidental

          death and dismemberment insurance, dependent life insurance,

          vision-care insurance, health insurance (including basic British

          Columbia medical services plan coverage and extended health coverage),

          dental insurance and short and long term disability insurance. QLT and

          Mr. Hastings agree that the employee benefit plans provided by/through

          QLT to its employees may change from time to time.



     (c)  EXPENSE REIMBURSEMENT - Reimbursement, in accordance with QLT's Policy

          and Procedures Manual (as amended from time to time), of all

          reasonable business related promotion, entertainment and/or travel

          expenses incurred by Mr. Hastings, subject to him maintaining proper

          accounts and providing documentation for these expenses upon request.



     (d)  VACATION -Mr. Hastings is entitled to four weeks' paid vacation during

          each calendar year, including the first, of his employment and

          pro-rated for any partial calendar year of employment which may be

          increased from time to time in accordance with QLT's standard vacation

          policy. As per QLT's Policy and Procedures Manual (as amended from

          time to time), unless agreed to in writing by QLT:



          I.   all vacation must be taken within one year of the year in which

               it is earned by Mr. Hastings, and





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          II.  except as set out in clause I above, vacation entitlement will

               not be cumulative from year to year.



     (e)  RRSP CONTRIBUTIONS - Provided the conditions set out below have been

          satisfied, no later than February 28 of the year following the year in

          which the income is earned by Mr. Hastings (the "INCOME YEAR"), QLT

          will make a contribution of up to 7% of Mr. Hastings' annual base

          salary for the Income Year to Mr. Hastings' Canadian Registered

          Retired Savings Plan ("RRSP"). The contribution to Mr. Hastings' RRSP

          as set out above is subject the following conditions:



          I.   the maximum contribution to be made by QLT to Mr. Hastings' RRSP

               is 50% of the annual limit for Registered Retirement Savings

               Plans as established by Canada Customs & Revenue Agency for the

               Income Year,



          II.  Mr. Hastings must have contributed an equal amount into his RRSP,

               and



          III. Mr. Hastings is still actively employed by QLT when the matching

               contribution would otherwise be made.



     (f)  CASH INCENTIVE COMPENSATION PLAN - Mr. Hastings will be eligible to

          participate in the Cash Incentive Compensation Plan offered by QLT to

          its senior executives in accordance with the terms of such Plan, as

          amended from time to time by the Board. Mr. Hastings will be eligible

          to receive each year as a lump sum payment an amount up to 50% of his

          base salary under the Cash Incentive Compensation Plan. The amount of

          that payment will be determined at the sole discretion of the

          Executive Compensation Committee of the Board annually following the

          completion of each fiscal year of QLT and will be based on the

          performance of Mr. Hastings and QLT relative to pre-set corporate and

          individual objectives and milestones to have been achieved in the

          immediately preceding fiscal year. Those goals and milestones will be

          set for each year by the Board after discussion with Mr. Hastings. For

          greater certainty, Mr. Hastings will not be eligible to receive any

          such amount in 2002 for the preceding fiscal year but will be eligible

          to receive that incentive payment in 2003 and subsequent years, based

          on his employment in 2002 and in subsequent years.



     (g)  ANNUAL STOCK OPTIONS - Mr. Hastings will be eligible for participation

          in QLT's Incentive Stock Option Plans, in accordance with the terms of

          the plan in effect at the time of the stock option offer. QLT's

          management responsible for the Stock Option Plan will recommend to the

          Board each year during the term of this Agreement commencing in 2003

          to approve options in that year for Mr. Hastings to purchase an

          aggregate of 100,000 common shares of QLT, which amount may be reduced

          or increased on a year-to-year basis at the sole discretion of the

          Board. The grant of options may, at the sole discretion of the Board,

          be spread over one or more separate grants during the course of each

          year in a manner consistent with QLT's stock option practices and

          policies then in effect.



     (h)  SIGNING STOCK OPTIONS - Conditional on Mr. Hastings entering into this

          Agreement, the Board has approved and will grant the option for Mr.

          Hastings to purchase 500,000 common shares of QLT plus an additional

          option to be granted at a date in April, 2002 to be set by QLT for Mr.

          Hastings to purchase 100,000 common shares of QLT. The options will be

          subject to the terms and conditions set out in QLT's current Stock

          Option Incentive Plan, have a five-year term from the date of grant

          and will vest monthly in equal numbers over three years. The exercise

          price of these signing options will be determined by the closing price

          on the Toronto Stock Exchange on the day prior to granting. Stock

          options may not be exercised until Mr. Hastings has successfully

          completed six months' employment with QLT from the Commencement Date

          and the grant will be conditional upon Mr. Hastings not having

          provided a Resignation Notice (as



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          later defined) nor having received a written notice of termination

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