Exhibit 10.38

[CombinatoRx Letterhead]

August 4, 2008

BioMedical Sciences Investment Fund Pte Ltd

20 Biopolis Way

#09-01 Centros

Singapore 138668

Attention: Chief Executive Officer

Re: Agreement Regarding Exercise of Parent Share Repurchase Option

Ladies and Gentlemen:

CombinatoRx (Singapore) Pte Ltd (the “Company”), Biomedical Sciences Investment
Fund Pte Ltd (the “Investor”) and CombinatoRx, Incorporated (the “Parent”), are
parties to a Subscription and Shareholders Agreement, dated August 19, 2005 (the
“SSA”) and a Swap-Up Agreement, dated August 30, 2005 (the “Swap-Up Agreement”).
Under Section 7.1 of the Swap-Up Agreement, Investor granted Parent the option,
exercisable at any time, to purchase all of the Investor’s preferred shares in
the Company for a cash purchase price (the “Parent Share Repurchase Option”). By
executing this letter agreement, the Parent hereby agrees not to exercise the
Parent Share Repurchase Option under the Swap-Up Agreement until on or after
December 31, 2009, provided, however, the Parent may exercise the Parent Share
Purchase Option after the Investor has breached a material obligation under the
SSA and related agreements, or after an Organic Change of the Parent, as defined
in the Swap-Up Agreement.

 

Sincerely, COMBINATORX, INCORPORATED By:  

/s/ Alexis Borisy

Name:   Alexis Borisy Title:   President & CEO COMBINATORX (SINGAPORE) PTE LTD
By:  

/s/ Ralf Altmeyer

Name:   Ralf Altmeyer Title:   President BIOMEDICAL SCIENCES INVESTMENT FUND PTE
LTD By:  

/s/ Chu Swee Yeok

Name:   Chu Swee Yeok Title:   Director Date:  

August 5, 2008