Exhibit 10.3

CONSULTING AGREEMENT

        This Consulting Agreement, including the attached Exhibit A (this
“Agreement”), is made and entered into as of July 28, 2003 (the “Effective
Date”) by and between Adolor Corporation, a Delaware corporation having offices
at 700 Pennsylvania Drive, Exton, PA 19352 (the “Company”), and Paul Goddard, an
individual residing at (“Consultant”).

        Consultant currently serves as a member of the Board of Directors of the
Company (the “Board”).

        The Company desires to retain Consultant as an independent contractor to
perform consulting services for the Company, and Consultant is willing to
perform such services, on terms set forth more fully below, in consideration of
the mutual promises contained herein. The parties agree as follows:

1. SERVICES AND COMPENSATION

    (a)     Consultant agrees to perform for the Company the services described
in Exhibit A attached hereto (“Services”).

    (b)        The Company agrees to pay to Consultant the compensation set
forth in Exhibit A for the performance of the Services, subject to the
limitations on such compensation set forth in Exhibit A.

2. CONFIDENTIALITY

    (a)        “Confidential Information” means any Company proprietary
information, technical data, trade secrets or know-how, including, but not
limited to, research and product plans, products, services, markets,
developments, inventions, processes, formulas, technology, marketing, finances
or other business information disclosed to Consultant by the Company, either
directly or indirectly, in writing, orally or otherwise.

    (b)        Consultant will not, during or subsequent to the term of this
Agreement, use Confidential Information for any purpose whatsoever other than
the performance of the Services on behalf of the Company or the fulfillment of
Consultant’s duties as a member of the Board, if applicable, or disclose
Confidential Information to any third party. Consultant agrees that Confidential
Information shall remain the sole property of the Company. Consultant further
agrees to take all reasonable precautions to prevent any unauthorized disclosure
of Confidential Information. Notwithstanding the above, Consultant’s obligation
under this Section 2(b) relating to Confidential Information shall not apply to
information which (i) is known to Consultant at the time of disclosure to
Consultant by the Company as evidenced by written records of Consultant, (ii)
has become publicly known and made generally available through no wrongful act
of Consultant, or (iii) has been rightfully received by Consultant from a third
party authorized to make such disclosure.

    (c)        Consultant agrees that Consultant will not, during the term of
this Agreement, improperly use or disclose to the Company any proprietary
information or trade secrets of any former or current employer or other person
or entity with which Consultant has an agreement or duty to keep in confidence
information acquired by Consultant in confidence and that Consultant will not
bring onto the premises of the Company any unpublished document or proprietary
information belonging to such employer, person or entity unless consented to in
writing by such employer, person or entity.

    (d)        Consultant recognizes that the Company has received and in the
future will receive from third parties their confidential or proprietary
information subject to a duty on the Company’s part to maintain the
confidentiality of such information and to use it only for certain limited
purposes. Consultant agrees that Consultant owes the Company and such third
parties, during the term of this Agreement and thereafter, a duty to hold all
such confidential or proprietary information in the strictest confidence and not
to disclose it to any person, firm or corporation or to use it except as
necessary in carrying out the Services for the Company or in carrying out
Consultant’s duties as a member of the Board, if applicable, consistent with the
Company’s agreement with such third party.

    (e)        Upon the termination of this Agreement, or upon the Company’s
earlier request, Consultant will deliver to the Company all of the Company’s
property relating to, and all tangible embodiments of, Confidential Information
in Consultant’s possession or control.

3. OWNERSHIP

    (a)        Consultant hereby irrevocably assigns to the Company all right,
title and interest in and to information (including, without limitation,
business plans and/or business information), technology, know-how, materials,
notes, records, designs, ideas (whether or not patentable), inventions,
improvements, devices, developments, discoveries, compositions, trade secrets,
processes, methods and/or techniques conceived, reduced to practice or made by
Consultant alone or jointly with others in the course of performing the Services
hereunder (collectively, “Inventions”).

    (b)        Consultant agrees that Consultant shall sign, execute and
acknowledge without cost, but at the expense of the Company, any and all
documents and to perform such acts as may be necessary, useful or convenient for
the purposes of perfecting the foregoing assignments and obtaining, enforcing
and defending intellectual property rights in any and all countries with respect
to inventions. It is understood and agreed that the Company or the Company’s
designee shall have the sole right, but not the obligation, to prosecute and
maintain patent applications and patents worldwide with respect to Inventions.

    (c)        Upon the termination of this Agreement, or upon the Company’s
earlier requests, Consultant will deliver to the Company all property relating
to, and all tangible embodiments of, Inventions in Consultant’s possession or
control.

    (d)        Consultant agrees that if in the course of performing the
Services, Consultant incorporates into any invention developed hereunder any
invention, improvement, development concept, discovery or other proprietary
information owned by Consultant or in which Consultant has an interest (“Item”),
the Company is hereby granted and shall have a non-exclusive, royalty-free,
perpetual, irrevocable, worldwide license to make, have made, modify, reproduce,
display, use and sell such Item as part of or in connection with such Invention.

    (e)        Consultant agrees that if the Company is unable because of
Consultant’s unavailability, dissolution, mental or physical incapacity, or for
any other reason, to secure Consultant’s signature to apply for or to pursue any
application for any United States or foreign patents or copyright registrations
covering any Invention assigned to the Company above, then Consultant hereby
irrevocably designates and appoints the Company and its duly authorized officers
and agents as Consultant’s agent and attorney-in-fact, to act for and in
Consultant’s behalf and stead to execute and file any such applications and to
do all other lawfully permitted acts to further the prosecution and issuance of
patents and copyright registrations thereon with the same legal force and effect
as if executed by Consultant.

4. REPORTS.

Consultant agrees that Consultant will from time to time during the term of this
Agreement or any extension thereof keep the Company advised as to Consultant’s
progress in performing the Services hereunder and that Consultant will, as
reasonably requested by the Company, prepare written reports with respect
thereto. It is understood that the time required in the preparation of such
written reports shall be considered time devoted to the performance of the
Services by Consultant. Reports prepared by Consultant shall be the sole
property of the Company.

5. CONFLICTING OBLIGATIONS.

Consultant certifies that Consultant has no outstanding agreement or obligation
that is in conflict with any of the provisions of this Agreement or with
Consultant’s responsibilities to the Company, or that would preclude Consultant
from complying with the provisions hereof, and further certifies that Consultant
will not enter into any such conflicting agreement during the term of this
Agreement. Consultant acknowledges his obligations under the Company’s Statement
of Policy Concerning Trading Policies and Conflicts of Interest and agrees that
he will promptly notify the Company of any development that could conflict with
his obligations to the Company as a member of the Board or under this Agreement.

6. TERMS AND TERMINATION

    (a)        This Agreement will commence on the date first written above and
will automatically terminate one (1) year after such date.

    (b)        Either party may terminate this Agreement upon giving thirty (30)
days’ prior written notice thereof to the other party. Any such notice shall be
given at the applicable address shown above or such other address as either
party may notify the other of and shall be deemed given upon delivery if
personally delivered, or forty-eight (48) hours after deposited in the United
States mail, postage prepaid, registered or certified mail, return receipt
requested.

    (c)        Upon termination of this Agreement, all rights and duties of the
parties hereunder shall cease except:

    (i)               the Company shall be obliged to pay, within thirty (30)
days after receipt of Consultant’s final statement, all amounts owing to
Consultant for unpaid Services and related expenses, if any, in accordance with
the provisions of Section 1 (Services and Compensation) hereof, and

    (ii)               Sections 2 (Confidentiality), 3 (Ownership), 7
(Independent Contractor), 8 (Arbitration and Equitable Relief) and 9 (General)
shall survive termination of this Agreement.

7. INDEPENDENT CONTRACTOR. Nothing in this Agreement shall in any way be
construed to constitute Consultant as an agent, employee or representative of
the Company, but Consultant shall perform the Services hereunder as an
independent contractor. Consultant acknowledges and agrees that Consultant is
obligated to report as income all compensation received by Consultant pursuant
to this Agreement.

8. ARBITRATION AND EQUITABLE RELIEF. The Company and Consultant agree that any
dispute or controversy arising out of, in relation to, or in connection with
this Agreement, or the making, interpretation, construction, performance or
breach thereof, shall be finally settled by binding arbitration in Pennsylvania
under the then current rules of the American Arbitration Association by one (1)
arbitrator appointed in accordance with such rules. The arbitrator may grant
injunctive or other relief in such dispute or controversy. The decision of the
arbitrator, shall be final, conclusive and binding on the parties to the
arbitration. Judgment may be entered on the arbitrator’s decision in any court
of competent jurisdiction. The parties agree that, any provision of applicable
law notwithstanding, they will not request and the arbitrator shall have no
authority to award, punitive or exemplary damages against any party. The costs
of the arbitration, including administrative and arbitrator’s fees, shall be
shared equally by the parties. Each party shall bear the cost of its own
attorneys’ fees and expert witness fees.

9. GENERAL

    (a)        Notices. Any required notice shall be given in writing at the
address of each party set forth above, or to such other address as either party
may substitute by written notice to the other in the manner contemplated in this
Section 9, and shall be deemed given when delivered or, if delivery is not
accomplished by reason or some fault of the addressee, when tendered.

    (b)        Assignment. Neither this Agreement nor any right hereunder or
interest herein may be assigned or transferred by Consultant without the express
written consent of the Company. The Company may assign this Agreement to an
entity that succeeds to substantially all of the business or assets of the
Company.

    (c)        Governing Law. This Agreement shall be governed by, and construed
and interpreted under, the laws of the Commonwealth of Pennsylvania without
reference to conflicts of laws principles.

    (d)        No Subcontracting. Consultant shall not subcontract any portion
of Consultant’s duties under this Agreement without the prior written consent of
the Company.

    (e)        Severability. In the event that any provision of this Agreement
becomes or is declared by a court of competent jurisdiction to be illegal,
unenforceable or void, this Agreement shall continue in full force and effect
without said provision, provided that no such severability shall be effective if
it materially changes the economic benefit of this Agreement to either the
Company or Consultant.

    (f)        Modification Waiver. This Agreement may not be altered, amended
or modified in any way except by writing signed by both parties. Waiver of any
term or provision of this Agreement or forbearance to enforce any term or
provision by either party shall not constitute a waiver as to any subsequent
breach or failure of the same term or provision or a waiver of any other term or
provision of this Agreement.

    (g)        Entire Agreement. The parties hereto acknowledge that this
Agreement and the Exhibits hereto set forth the entire agreement and
understanding of the parties as to the subject matter hereof, and supersedes all
prior discussion, agreements and writings in respect hereto.

    (h)        Counterparts. This Agreement may be executed in counterpart, each
of which shall be deemed an original, but both of which together shall
constitute one and the same instrument.

        IN WITNESS WHEREOF, the undersigned are duly authorized to execute this
Agreement on behalf of the Company and Consultant, as applicable.

ADOLOR CORPORATION

CONSULTANT

By /s/ Bruce A. Peacock /s/ Paul Goddard      Bruce A. Peacock Paul Goddard
     Chief Executive Officer

EXHIBIT A

SERVICES AND COMPENSATION

1.     Description of Services.

a.         Consultant shall provide strategic business advice and related
assistance to the Company’s Chief Executive Officer and management team in the
role of advisor.

b.         Consultant shall make himself reasonably available for consultation
with the Company’s management for up to a maximum of 17 days per year, as the
Company may reasonably request. The Company shall not request Consultant to work
less than a minimum 17 days per year.

2.     Consideration for Services.

a.         $8,500, paid quarterly.

b.         Option to purchase 4,000 shares of the Company’s Common Stock,
subject to the terms and conditions of the applicable option agreement and 2003
Stock-Based Incentive Compensation Plan.

c.         Reasonable expenses as authorized.

d.         Notwithstanding anything in this Agreement to the contrary, in no
event shall the aggregate consideration (on an annual or other basis) paid by
the Company to Consultant pursuant to this Agreement exceed an amount such that
Consultant would not be considered an “independent” member of the Board under
any applicable laws, rules or regulations promulgated by the Securities and
Exchange Commission, the National Association of Securities Dealers, the Nasdaq
National Market or any other regulatory authority or body to which the Company
is subject.