AGREEMENT BY AND BETWEEN

                        IMPERIAL CHEMICAL INDUSTRIES PLC

                                       AND

                           ARENA PHARMACEUTICALS, INC.





                                TABLE OF CONTENTS



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                                                                            PAGE

{S}               {C}                                                       {C}

Article I.        Definitions                                                 1

Article II.       Feasibility Study                                           4

Article III.      Exclusivity                                                 5

Article IV.       Payments to Arena                                           6

Article V.        Utilization of Data                                         7

Article VI.       Technology License                                          7

Article VII.      Royalty Payments                                            8

Article VIII.     Confidentiality                                            10

Article IX.       Patent Infringement And Enforcement                        11

Article X.        Representations And Warranties                             12

Article XI.       Indemnity                                                  12

Article XII.      Termination                                                13

Article XIII.     Relationship of the Parties                                14

Article XIV.      Miscellaneous Provisions                                   14

Signature Blocks                                                             18

Appendices                                                      A-1 through A-5

{/Table}





                                 --PLEASE NOTE--



           Provisions Within This Agreement Are Deemed "CONFIDENTIAL"

                  In Accordance With The Terms of Article VIII.



           Reviewers are advised to confirm with their attorney as to

     any obligations and/or requirements regarding review of this Agreement.





{Page}



                                                                  CONFIDENTIAL



                                   AGREEMENT



     This Agreement ("Agreement") is effective as of June 15, 2001 ("Effective

Date") by and between IMPERIAL CHEMICAL INDUSTRIES PLC, having a place of

business at London SWIP 3JF, United Kingdom ("ICI") and ARENA PHARMACEUTICALS,

INC., having a place of business at 6166 Nancy Ridge Drive, San Diego,

California, 92121 USA ("Arena").



     WHEREAS, ICI is a company which produces specialty products including

fragrances, flavors and food ingredients;



     WHEREAS, Arena is a biopharmaceutical organization focused on the

development and use of its proprietary technology for discovery of modulators of

G protein-coupled receptors;



     WHEREAS, ICI desires to collaborate with Arena to identify broad-spectrum

modulators of specific G protein-coupled receptors to enhance the discovery

processes in the fragrances, flavors and food industry;



     WHEREAS, Arena and ICI each desire to enter into this Agreement on the

terms and conditions set forth herein.



     NOW, THEREFORE, in consideration of the mutual covenants and agreements

contained herein, and for other good and valuable consideration, the receipt and

sufficiency of which is hereby acknowledged, ICI and Arena hereby agree as

follows:





                                    ARTICLE I

                                   DEFINITIONS



     Unless otherwise specifically provided herein, the following terms shall

have the following meanings:



"AFFILIATE" when used with reference to a specified person, any person or entity

directly or indirectly controlling, controlled by or under common control with

the specified person, means the direct or indirect ownership of at least 50% of

the outstanding voting securities of an entity.



"ANNUAL" means the period between January 1 and December 31, inclusive.



"ARENA" means Arena and its Affiliates, excluding Aressa Pharmaceuticals, Inc.



"ARENA ACTIVATION TECHNOLOGY" means an Arena proprietary approach to altering a

region of a G Protein-Coupled Receptor to cause, enhance or stabilize

constitutive activation of the altered receptor.



"ARENA PATENT RIGHTS" means all present and/or future patents (including

inventor's certificates) and all present and/or future applications (including

provisional applications) therefor throughout the world as the case may be, and

substitutions, extensions, reissues,





                                       1

                                  CONFIDENTIAL

{Page}



                                                                  CONFIDENTIAL



renewals, divisions, continuations, or continuation-in-part thereof or therefor,

owned or controlled (either fully or partially) by Arena, or under which Arena

may grant licenses or sublicenses, to the extent they are directed to (1) Arena

Activation Technology and/or (2) CART Activated Receptor(s) and/or (3) Screening

Assay(s) and/or (4) CART Identified Ingredient(s). It is understood that ICI

Patent Rights shall be excluded from the scope of Arena Patent Rights. A list of

Arena Patent Rights shall be attached hereto as APPENDIX B1 as of the Effective

Date and Arena shall update APPENDIX B1 from time to time during the terms of

this Agreement by sending ICI such updated APPENDIX B1 and also the updated

APPENDIX B1 as of the end of December in each year within one (1) month after

such date.



"BEST REASONABLE COMMERCIAL EFFORTS" means efforts to achieve a designated

objective, which efforts are based upon reasonably prudent business factors and

considerations.



"CART ACTIVATED RECEPTOR(S)" means a Sensory GPCR to which Arena Activation

Technology has been applied, and which has reached a level of activity such that

its use in an assay results in a signal to noise ratio that predicts its utility

in an Enabled Screening Assay.



"CART IDENTIFIED INGREDIENT(S)" means an ingredient, and/or a Derivative of a

CART Identified Ingredient, that has been identified from ICI Library

Ingredient(s) as a modulator of a CART Activated Receptor(s).



"INGREDIENT DISCOVERED DURING THE FEASIBILITY STUDY" or "INGREDIENT DISCOVERED

DURING THE EXCLUSIVITY PERIOD" means a CART Identified Ingredient.



"DERIVATIVE" and "DERIVATIVES" of a first ingredient means an ingredient having

the same core structure as the first ingredient.



"EC50 Value" means the concentration of an ingredient that inhibits 50% of

measured second messenger signal of a receptor.



 "ENABLED SCREENING ASSAY" means an Arena assay approach for Screening that has

been validated based upon Successful Screening of a CART Activated Receptor.



"ENDOGENOUS" means naturally occurring.



"FIELD" means the [************************************************] uses of

CART Identified Ingredients for modulation of Sensory GPCRs; for purposes of

clarity, the definition of Field includes, but is not limited to,

[**********************].



"G PROTEIN-COUPLED RECEPTOR" and "GPCR" and "GPCRS" each mean Endogenous, human

cell-surface receptor defined by having three (3) intracellular loops, three (3)

extracellular loops, an amino terminus and a carboxy terminus.



"GUSTATORY GPCRS" means GPCRs primarily expressed within the human mouth, throat

and stomach.





                                       2

                                  CONFIDENTIAL

{Page}



                                                                  CONFIDENTIAL



"IC50 VALUE" means the concentration of an ingredient that inhibits 50% of

ligand binding to the receptor.



"ICI" means ICI and its Affiliates.



"ICI LIBRARY INGREDIENTS" shall mean chemical compounds that shall be provided

to Arena by ICI during the term of this Agreement and in accordance with the

requirements set forth in APPENDIX A.



"ICI PATENT RIGHTS" means all present and/or future patents (including

inventor's certificates) and all present and/or future applications (including

provisional applications) therefor throughout the world as the case may be, and

substitutions, extensions, reissues, renewals, divisions, continuations, or

continuation-in-part thereof or therefor, owned or controlled (either fully or

partially) by ICI, or under which ICI may grant licenses or sublicenses, to the

extent they are directed to ICI Library Ingredients It is understood that Arena

Patent Rights shall be excluded from the scope of ICI Patent Rights. A list of

ICI Patent Rights shall be attached hereto as APPENDIX B2 as of the Effective

Date and ICI shall update APPENDIX B2 from time to time during the terms of this

Agreement by sending Arena such updated APPENDIX B2 and also the updated

APPENDIX B2 as of the end of December in each year, within one (1) month after

such date.



"MEASURED RESPONSE" as used in the phrase "Successful Screening" means a signal

measure based upon an assay end-point used to assess the signal.



"OLFACTORY GPCRS" means GPCRs primarily expressed within the olfactory region of

a human.



"PARTY" means either Arena or ICI, as the case may be; "Parties" means both

Arena and ICI.



"REVENUE" means [********************************************************

******************************************************************].



"SCREENING ASSAY" or "RECEPTOR SCREENING ASSAY" means the process of contacting

a chemical compound with a CART Activated Receptor.



"SENSORY GPCRS" means Olfactory GPCRs and Gustatory GPCRs.



"SUCCESSFUL SCREENING" means that the results of the Screening have been

positive whereby at least one molecule from ICI Library Ingredients that has

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