Medchem (P.R.), Inc. - Page 70




                                       - 70 -                                         
               MedChem [P.R.] in the Product Specifications or the                    
               Conversion Process from the manner in which such                       
               procedures were carried out by Alcon [P.R.] as of the                  
               date of this Agreement, if such change is the proximate                
               cause of such claim, damages, costs or expenses, (ii)                  
               the promotion, distribution, sale and/or internal use                  
               by MedChem [P.R.] of Avitene processed by Alcon [P.R.]                 
               hereunder unless at the time of Delivery such Avitene                  
               did not meet the warranty set forth in Section 11.1                    
               hereof and (iii) any breach by MedChem [P.R.] of its                   
               warranties and obligations under this Agreement.  Upon                 
               the filing of any such claim or suit, Alcon [P.R.]                     
               shall immediately notify MedChem [P.R.] thereof and                    
               shall permit MedChem [P.R.], at its cost, to handle and                
               control such claim or suit provided, however, that                     
               Alcon [P.R.] may, at its own expense, retain such                      
               additional attorneys as it may deem necessary, which                   
               attorneys will be permitted to reasonably observe                      
               and/or participate in all aspects of (but not control)                 
               the defense of such claims or suits.  MedChem [P.R.]                   
               shall have the right, after consultation with Alcon                    
               [P.R.], to resolve and settle any such claims or suits.                
               This Indemnity shall not abrogate or in any way modify                 
               the obligations of Alcon [P.R.] pursuant to the                        
               representations and warranties contained in the Asset                  
               Purchase Agreement.                                                    
                         11.3  Alcon [P.R.] Indemnity.  Alcon [P.R.]                  
               will indemnify and hold MedChem [P.R.] harmless from                   
               and against any and all liability, damage, loss, cost,                 
               or expense resulting from any third party claims made                  
               or suits brought against MedChem [P.R.] which arise                    
               from Alcon[ P.R.]’s breach of any provision of this                    
               Agreement, including, but not limited to, claims of                    
               product defect relating to Avitene which is not in                     
               conformity with the warranty set forth in Section 11.1                 
               hereof.  Upon the filing of any such claim or suit,                    
               MedChem [P.R.] shall immediately notify Alcon [P.R.]                   
               thereof and shall permit Alcon [P.R.], at its cost, to                 
               handle and control such claim or suit; provided,                       
               however, that MedChem [P.R.] may, at its own expense,                  
               retain such additional attorneys as it may deem                        
               necessary, which attorneys will be permitted to                        
               reasonably observe and/or participate in all aspects of                
               (but not control) the defense of such claims or suits.                 
               Alcon [P.R.] shall have the right, after consultation                  
               with MedChem [P.R.], to resolve and settle any such                    
               claims or suits.                                                       





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