PROPOSAL 1





ELECTION OF DIRECTORS




There are seven nominees for the seven Board positions presently
authorized in the Company's By-laws. Each director to be elected will hold
office until the next annual meeting of stockholders and until his successor
is elected and has qualified, or until such director's earlier death,
resignation or removal. Each nominee listed below is currently a director of
the Company, all such directors having been elected by the stockholders.


Directors are elected by a plurality of the votes present in person
or represented by proxy and entitled to vote. Shares represented by executed
proxies will be voted, if authority to do so is not withheld, for the
election of the seven nominees named below. In the event that any nominee
should be unavailable for election as a result of an unexpected occurrence,
such shares will be voted for the election of such substitute nominee as
management may propose. Each person nominated for election has agreed to
serve if elected and management has no reason to believe that any nominee
will be unable to serve.






                        THE BOARD OF DIRECTORS RECOMMENDS
                     A VOTE IN FAVOR OF EACH NAMED NOMINEE.

NOMINEES

         The names of the nominees and certain information about them are set
forth below:

NAME                                     AGE     PRINCIPAL OCCUPATION/POSITION HELD WITH THE COMPANY
Timothy J. Rink, M.D., Sc.D.              52     Chairman of the Board, President and Chief Executive Officer
James C. Blair, Ph.D. (1)                 59     Member, Board of Directors
Kevin J. Kinsella (1)                     53     Member, Board of Directors
Hugh Y. Rienhoff, Jr., M.D. (1) (2)       46     Member, Board of Directors
Lubert Stryer, M.D.                       61     Member, Board of Directors
Roy A. Whitfield                          45     Member, Board of Directors
Timothy J. Wollaeger (2)                  55     Member, Board of Directors













(1)      Member of the Compensation Committee


(2)      Member of the Audit Committee


TIMOTHY J. RINK has served as Chairman of the Board, President and
Chief Executive Officer of the Company since January 1996. From 1990 through
1995, Dr. Rink served as President and Chief Technical Officer of Amylin
Pharmaceuticals, Inc. ("Amylin"), a publicly held biopharmaceutical company.
Dr. Rink was Vice



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President, Research at SmithKline Beecham in the U.K. from 1984 to 1989, and
previously was Lecturer in Physiology at the University of Cambridge. Dr.
Rink currently serves as a director of CoCensys, Inc., a publicly-held
biopharmaceutical company. Dr. Rink received his M.A., M.D. and Sc.D. from
the University of Cambridge, England.


JAMES C. BLAIR has been a director of the Company since March 1996.
Dr. Blair has been a managing member of Domain Associates, L.L.C., a venture
capital investment firm, since 1985. From 1969 to 1985, Dr. Blair was an
officer of three investment banking and venture capital firms. Dr. Blair is a
director of Amylin Pharmaceuticals, Inc., CoCensys, Inc., Dura
Pharmaceuticals, Inc., Trega Biosciences, Inc. and Vista Medical
Technologies, Inc. Dr. Blair received a B.S.E. from Princeton University and
M.S.E. and Ph.D. degrees in Electrical Engineering from the University of
Pennsylvania.


KEVIN J. KINSELLA, a founder of the Company, has been a director of
the Company since its inception in May 1995. He currently serves as Chairman,
Chief Executive Officer and President of ANCILE Pharmaceuticals, Inc., a
privately-held biopharmaceutical company. Mr. Kinsella founded Sequana
Therapeutics, Inc., in February 1993 and served as President, Chief Executive
Officer and a member of the Board of Directors until its merger into AxyS
Pharmaceuticals, Inc. in January 1998. He was the Managing General Partner of
Avalon Ventures, a venture capital firm which established over thirty
companies, many of which are in the biopharmaceutical field. He was the
founding chairman of Athena Neurosciences Inc., ONYX Pharmaceuticals and
Vertex Pharmaceuticals Inc.. He received a B.S. from the Massachusetts
Institute of Technology and an M.A. from the Johns Hopkins School of Advanced
International Studies.


HUGH Y. RIENHOFF, JR. has been a director of the Company since March
1996. Dr. Rienhoff is currently Chief Executive Officer of Kiva Genetics,
Inc., which he founded in September 1998. Until April 1998, Dr. Rienhoff
served as a director of Abingworth Management Limited, a venture capital
investment firm. From 1992 to 1997, Dr. Rienhoff held various positions at
New Enterprise Associates Development Corporation, where he most recently
served as Partner. He is a director of Microcide Pharmaceuticals, Inc.. Dr.
Rienhoff received an M.D. degree from The Johns Hopkins University School of
Medicine and a B.A. degree in English Literature and Biology, with honors,
from Williams College.


LUBERT STRYER has been a director of the Company since March 96, and
currently serves as a scientific advisor of the Company. He is a Winzer
Professor in the School of Medicine and Professor of Neurobiology at Stanford
University and is a director of Affymetrix, Inc. ("Affymetrix"). He served as
President and Scientific Director of Affymax Research Institute in 1989 and
1990. He is co-inventor of Affymetrix's light-directed synthesis technology.
Dr. Stryer has pioneered the development of novel fluorescence detection
techniques and holds ten patents involving fluorescence and light-activated
chemical syntheses. Dr. Stryer is the author of BIOCHEMISTRY, a major text
used widely in colleges and universities around the world. Dr. Stryer
received the American Chemical Society Award in Biological Chemistry (the Eli
Lilly Award) and is a member of the National Academy of Sciences and received
an honorary Doctor of Science from The University of Chicago. Dr. Stryer
received his M.D. degree from Harvard University and his B.S. degree from the
University of Chicago.


ROY A. WHITFIELD has been a director of the Company since September
1997. Mr. Whitfield is the Chief Executive Officer of Incyte Pharmaceuticals,
Inc. ("Incyte"), a position he has held since June 1993, and has been a
director of Incyte since 1991. Mr. Whitfield served as President of Incyte
from June 1991 until January 1997 and as Treasurer from April 1991 until
October 1995. Previously, Mr. Whitfield served as the President of Ideon
Corporation, which was a majority owned subsidiary of Invitron Corporation, a
biotechnology company, from October 1989 until April 1991. From 1984 to 1989,
Mr. Whitfield held senior operating and business development positions with
Technicon Instruments Corporation, a medical instrumentation company, and its
predecessor company, CooperBiomedical, Inc., a biotechnology and medical
diagnostics company. Prior to his work at Technicon, Mr. Whitfield spent
seven years with the Boston Consulting Group's international consulting
practice. Mr. Whitfield received a B.S. with First Class Honors in
mathematics from Oxford University, and an M.B.A. with Distinction from
Stanford University.



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TIMOTHY J. WOLLAEGER has been a director of the Company since March
1996. He has been the general partner of Kingsbury Associates, Kingsbury
Capital Partners, L.P., Kingsbury Capital Partners, L.P. II and Kingsbury
Capital Partners, L.P. III venture capital investment partnerships since
1993. From 1990 to 1993, Mr. Wollaeger served as Senior Vice President and
was a director of Columbia Hospital Corporation ("CHC"), a hospital
management company now known as Columbia/HCA Healthcare Corporation From 1986
until 1993, he was a general partner of the general partner of Biovest
Associates, a venture capital investment firm. He is Chairman of the Board of
Biosite Diagnostics, Inc. He received an M.B.A. from Stanford University and
a B.A. in economics from Yale University.



BOARD COMMITTEES AND MEETINGS



During the fiscal year ended December 31, 1998 the Board of
Directors held seven meetings. The Board has an Audit Committee and a
Compensation Committee.


The Audit Committee meets with the Company's independent auditors to
review the results of the annual audit and discuss the financial statements;
recommends to the Board the independent auditors to be retained; and receives
and considers the accountants' comments as to controls, adequacy of staff and
management performance and procedures in connection with audit and financial
controls. The Audit Committee is composed of two non-employee directors: Dr.
Rienhoff and Mr. Wollaeger. It met twice during fiscal year 1998.


The Compensation Committee makes recommendations concerning
executive salaries and incentive compensation, awards stock options to the
Company's executive officers and consultants under the Company's equity
incentive plans and otherwise determines compensation levels and performs
such other functions regarding compensation as the Board may delegate. The
Committee is responsible for setting and administering the Company's policies
governing the Company's employee benefit plans. The Compensation Committee is
composed of three non-employee directors: Drs. Blair and Rienhoff and Mr.
Kinsella. It met three times during fiscal year 1998.


During the fiscal year ended December 31, 1997, each Board member
attended 75% or more of the aggregate of the meetings of the Board and of the
committees on which he served, held during the period for which he was a
director or committee member, respectively, except Mr. Kinsella, who attended
70% of the aggregate of the Board and committee meetings in which he was
entitled to participate.