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Protease induced ring contraction reaction of ethyl-4-oxo-3-phenyl-l-oxa-5-azaspiro[5,5]-undec-2-ene-2-car☐ylate (1) yielded 4-phenyl-3-hydroxy-1H-pyrrole-2,5-dione (5). This product and its derivatives have been characterized by comparing their total identity with authentic compounds. Involvement of basic amino acid residues for the initiation of the ring contraction reaction by abstracting the proton...