Exhibit
      10.1

    

      EMPLOYMENT
        AGREEMENT

      


      EMPLOYMENT
        AGREEMENT
        dated
        October 31, 2007 by and between NexMed, Inc., a Nevada corporation (the
        "Company") and Hemanshu Pandya (the "Executive"). 

      


      WHEREAS,
        the Company desires to continue to employ Executive and to enter into
        an
        agreement (the "Agreement") embodying the terms of such employment;


      


      WHEREAS,
        the Company considers it essential to its best interests and the best interests
        of its stockholders to foster the continued employment of Executive by the
        Company during the term of this Agreement; and 

      


      WHEREAS,
        Executive is willing to accept and continue his employment on the terms
        hereinafter set forth in this Agreement. 

      


      NOW,
        THEREFORE, in consideration of the premises and mutual covenants herein and
        for
        other good and valuable consideration, the parties agree as follows:


      


      
        	
                1.

              	
                Term
                  of Employment.
                  Subject to earlier termination in accordance with the provisions
                  of
                  Section 6 of this Agreement, Executive shall be employed by the
                  Company
                  pursuant to the terms of this Agreement for a period commencing
                  on October
                  31, 2007 (the "Effective Date") and ending on October 31, 2008
                  (the
                  "Initial Term of Employment"); provided,
                  however,
                  that,
                  the term of employment under this Agreement (the "Employment Term")
                  shall
                  renew automatically for one-year terms on each successive October
                  30th,
                  unless and until either party gives at least 60 days advance written
                  notice to the other that the Employment Term should not be automatically
                  extended. The Executive shall be employed “at will” and his employment can
                  be terminated at any time by either the Company or the Executive,
                  subject
                  to the provisions of Section 6
                  below.

              


      

       

      
        	
                2.

              	
                Position.

              


      

       

      
        	 	
                (a)

              	
                During
                  the Employment Term, Executive shall be employed by the Company
                  as Vice
                  President and Chief Operating Officer, and shall have such duties,
                  authority, and responsibility as are commensurate with his position,
                  subject to the direction of the Company's Chief Executive Officer
                  (the
                  “CEO”).

              


      

       

      
        	 	
                (b)

              	
                During
                  the Employment Term, Executive shall devote all of his business
                  time and
                  attention to the performance of his duties hereunder faithfully
                  and to the
                  best of his abilities and shall not undertake employment with,
                  or
                  participate in, the conduct of the business affairs of any other
                  person,
                  corporation, or entity; provided,
                  that,
                  nothing shall preclude Executive from (i) with the prior written
                  approval
                  of the CEO, serving in due course as a director, trustee or member
                  of a
                  committee of any organization or (ii) participating in the affairs
                  of any
                  recognized charitable organizations, or in any community affairs,
                  of
                  Executive's choice. 

              


      

       

      
        
          
          

        

        
          
          

          
            

          

        

        
          
          

        

      

       

      
        	 	
                (c)

              	
                Executive's
                  duties hereunder shall be performed for the Company worldwide,
                  with
                  principle place of business at the Company's headquarters in East
                  Windsor,
                  New Jersey. 

              


      

       

      
        	
                3.

              	
                Compensation.
                  

              


      

       

      
        	 	
                (a)

              	
                Base
                  Salary.
                  During the Employment Term, the Company shall pay Executive a base
                  salary,
                  subject to increase at the discretion of the Board of Directors
                  of the
                  Company (the "Board"), at the annual rate of $225,000
                  (the "Base Salary"), payable in regular installments in accordance
                  with
                  the Company's usual payroll practices. Such base salary will be
                  adjusted
                  to $250,000 annually following the Company’s receipt of an anticipated
                  cash infusion of $5 Million from a licensing
                  partner.

              


      

       

      
        	 	
                (b)

              	
                Bonus.
                  With respect to each calendar year during the Employment Term,
                  Executive
                  shall be eligible to earn an annual bonus award (the "Bonus") in
                  an amount
                  not to exceed 50% of Executive’s annual Base Salary. The amount of the
                  Bonus shall be determined by the Board, or the Compensation Committee
                  of
                  the Board (the "Compensation Committee"), in its sole discretion,
                  based
                  upon the achievement by the Company of objective performance measures
                  established and determined by the Board or the Compensation Committee
                  in
                  consultation with Executive no later than the end of the first
                  month of
                  such calendar year. The Bonus with respect to each calendar year
                  in the
                  Employment Term shall be paid as promptly as practicable following
                  the
                  delivery of the Company's audited financial statements for such
                  year, but
                  not later than March 15 of the calendar year following the calendar
                  year
                  in which the Bonus is earned. Unless otherwise stated herein, the
                  Bonus
                  shall not accrue until the date on which it is paid, and Executive
                  must be
                  employed on the date the Bonus is paid in order to receive the
                  Bonus,
                  except that Executive’s continuous employment is not required pursuant to
                  Sections 6(b)(2) and 6(c)(2). 

              


      

       

      
        	 	
                (c)

              	
                Stock
                  Option Grants.
                  

              


      

       

      
        	 	
                (i)

              	
                On
                  October 3, 2007, the Compensation Committee approved a grant to
                  Executive
                  of an option to purchase an aggregate of 175,000 shares of the
                  Company's
                  Common Stock (the "Option") based on the closing price of the Company’s
                  Common Stock on October 31, 2007 of $1.43 per
                  share. The Option vests in three installments: 25,000 Stock Option
                  Shares
                  on October 31, 2008; 50,000 Stock Option Shares on October 31,
                  2009; and
                  100,000 Stock Option Shares on October 31, 2010, assuming continuous
                  and
                  uninterrupted employment until such dates. The Company will provide
                  the
                  Executive the ability to perform a cashless exercise of all Stock
                  Options,
                  in accordance with the vesting
                  schedule.

              


      

       

      
        	 	
                (ii)

              	
                The
                  Option is subject to The NexMed, Inc. Stock Option and Long-Term
                  Incentive
                  Compensation Plan (the "Option Plan") and the applicable stock
                  option
                  agreement. 

              


      

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

       

      
        	 	
                (iii)

              	
                In
                  addition to the foregoing, the Compensation Committee may recommend
                  to the
                  Board that additional stock options be granted to Executive in
                  accordance
                  with the terms and subject to the conditions of the Option
                  Plan.

              


      

       

      
        	 	
                (iv)

              	
                All
                  of Executive's outstanding but unvested stock options shall vest
                  immediately upon the occurrence of a Change in Control (as defined
                  in
                  Appendix A hereto).

              


      

       

      
        	 	
                (d)

              	
                Stock
                  Grants.
                  

              


      

      


      
        	 	
                (i)

              	
                On
                  October 3, 2007, the Compensation Committee approved a grant to
                  Executive
                  of an aggregate of 75,000 shares of the Company’s Restricted Common Stock.
                  This Grant vests in three equal installments (33.33% of the Stock
                  Grants,
                  which represents 25,000 Stock Shares) on October 31, 2008, October
                  31,
                  2009, and October 31, 2010, respectively, assuming continuous and
                  uninterrupted employment until such
                  dates.

              


      

       

      
        	 	
                (ii)

              	
                On
                  October 3, 2007, the Compensation Committee approved a grant to
                  Executive
                  of an aggregate of 50,000 shares of the Company’s Common Stock. This Grant
                  will vest upon the Executive’s execution of a licensing/development
                  agreement valued at over $5 Million, provided that
                  such agreement is executed within 18 months of Executive’s employment
                  start date and assuming continuous and uninterrupted employment
                  until such
                  date.

              


      

       

      
        	 	
                (iii)

              	
                All
                  of Executive’s outstanding but unvested stock grants provided under this
                  Section shall vest immediately upon the occurrence of a Change
                  in Control
                  (as defined in Appendix A of the
                  Agreement).

              


      

       

      
        	
                4.

              	
                Employee
                  Benefits.
                  During the Employment Term, Executive shall be eligible for inclusion,
                  to
                  the extent permitted by law, as a full-time employee of the Company
                  or any
                  of its subsidiaries, in any and all of the following plans, programs,
                  and
                  policies in effect at the time: (i) pension, profit sharing, savings,
                  and
                  other retirement plans and programs, (ii) life and health (medical,
                  dental, hospitalization, short-term and long-term disability) insurance
                  plans and programs, (iii) stock option and stock purchase plans
                  and
                  programs, (iv) accidental death and dismemberment protection plans
                  and
                  programs, (v) travel accident insurance plans and programs, (vi)
                  vacation
                  policy (Executive shall have four weeks of vacation per calendar
                  year),
                  and (vii) other plans and programs sponsored by the Company or
                  any
                  subsidiary for employees or executives generally, including any
                  and all
                  plans and programs that supplement any or all of the foregoing
                  types of
                  plans or programs. 

              


      

       

      
        	
                5.

              	
                Business
                  Expenses and Perquisites.
                  The Company shall reimburse to Executive, or pay directly, all
                  reasonable
                  expenses incurred by Executive in connection with the business
                  of the
                  Company, and its subsidiaries and affiliates, including but not
                  limited to
                  business-class travel, reasonable accommodations, and entertainment,
                  subject to documentation in accordance with the Company's policy.
                  

              


      

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

       

      
        	
                6.

              	
                Termination.
                  

              


      

       

      
        	 	
                (a)

              	
                By
                  the Company for Cause.
                  The Company may, for Cause, terminate Executive's employment hereunder
                  at
                  any time by written notice to Executive. For purposes of this Agreement,
                  the term "Cause" shall mean Executive's (i) engaging in fraud against
                  the
                  Company or misappropriation of funds of the Company, (ii) disregard
                  or
                  failure to follow specific and reasonable directives of the Board,
                  (iii)
                  willful failure to perform his duties as Vice President and Chief
                  Operating Officer of the Company, (iv) willful misconduct resulting
                  in
                  material injury to the Company, (v) violation of the terms of the
                  Non-Disclosure and Inventions Agreement between Executive and NexMed
                  (U.S.A.), Inc., a wholly-owned subsidiary of the Company, dated
                  October
                  31, 2007 (the "Non-Disclosure Agreement") attached hereto as Appendix
                  "B",
                  (vi) conviction of, or Executive's plea of guilty or no contest
                  to, a
                  felony or any crime involving as a material element fraud or dishonesty,
                  or (vii) material breach (not covered by clauses (i) through (vi)
                  of this
                  paragraph) of any of the other provisions of this Agreement; provided,
                  that,
                  in the case of subclauses (ii), (iii) or (vii), Cause shall not
                  exist if
                  the act or omission deemed to constitute Cause is cured (if curable)
                  by
                  Executive within thirty (30) days after written notice thereof
                  to
                  Executive by the Company. For purposes of the foregoing, no act,
                  or
                  failure to act, on Executive's part shall be considered "willful"
                  unless
                  done, or omitted to be done, by Executive other than in good faith,
                  and
                  without reasonable belief that his action or omission was in furtherance
                  of the interests of the Company. 

              


      

       

      In
        the
        event of the termination of Executive's employment under this Section 6(a)
        for
        Cause, the Employment Term shall end on the day of such termination and the
        Company shall pay to Executive, no later than the payroll cycle following
        Executive’s termination, in one lump sum: (i) any accrued but unpaid Base
        Salary, less applicable deductions, including salary in respect of any accrued
        and accumulated vacation due to Executive at the date of such termination;
        and
        (ii) any amounts owing, but not yet paid, pursuant to Section 5
        hereof.

      


      Except
        as
        specifically set forth in Section 9 hereof, the Company shall have no further
        obligations to Executive under this Agreement. 

      


      
        	 	
                (b)

              	
                Disability
                  or Death.
                  If Executive should suffer a Permanent Disability, the Company
                  may
                  terminate Executive's employment hereunder upon ten (10) or more
                  days'
                  prior written notice to Executive. If Executive should pass away
                  during
                  the term of this Agreement, Executive’s employment shall be deemed
                  terminated on his date of death. For purposes of this Agreement,
                  a
                  "Permanent Disability" shall be deemed to have occurred only when
                  Executive has qualified for benefits (including satisfaction of
                  any
                  applicable waiting period) under the Company's or a subsidiary's
                  long-term
                  disability insurance arrangement (the "LTD Policy"). In the event
                  of the
                  termination of Executive's employment hereunder by reason of Permanent
                  Disability or death, the Employment Term shall end on the day of
                  such
                  termination and the Company shall pay, no later than the payroll
                  cycle
                  following Executive’s termination, to Executive or Executive's legal
                  representative (in the event of Permanent Disability), or any beneficiary
                  or beneficiaries designated by Executive to the Company in writing,
                  or to
                  Executive's estate if no such beneficiary has been so designated
                  (in the
                  event of Executive's death), a single lump sum payment of: (i)
                  any accrued
                  but unpaid Base Salary, less applicable deductions, including salary
                  in
                  respect of any accrued and accumulated vacation, due to Executive
                  at the
                  date of such termination; (ii) any amounts owing, but not yet paid,
                  pursuant to Section 5 hereof. 

              


      

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      In
        addition, upon a termination under this Section 6(b), and upon the satisfaction
        of the conditions set forth herein: (1) Executive shall receive a pro rata
        Bonus
        for the calendar year in which such termination occurs, equal to the Bonus
        he
        would have received, to the extent all criteria for such a Bonus have been
        met
        (with the exception of the requirement that Executive be employed on the
        date
        the Bonus is to be paid), for the calendar year of said termination multiplied
        by a fraction, the numerator of which is the number of days in such year
        preceding and including the date of termination, and the denominator of which
        is
        365. Said pro-rata Bonus shall be paid at the same time as the Bonus would
        have
        been paid had Executive remained employed by the Company through the date
        of
        payment, but in any event, not later than March 15 of the calendar year
        following the calendar year in which the Bonus is earned; (2) Executive shall
        receive any unpaid Bonus for the calendar year preceding his termination,
        to the
        extent that all criteria for such bonus have been met (with the exception
        of the
        requirement that Executive be employed on the date the Bonus is to be paid).
        Said Bonus shall be paid at the same time as the Bonus would have been paid
        had
        Executive remained employed by the Company through the date of payment; (3)
        Executive’s next-scheduled but unvested stock options granted pursuant to
        Section 3(c) of this Agreement shall vest immediately; and (4) Executive’s
        next-scheduled but unvested stock granted pursuant to Section 3(d) of this
        Agreement shall vest immediately. The payment of the Bonuses and the
        acceleration of Executive’s options and stock are conditioned upon Executive (or
        his legal representative) signing a release in favor of the Company, as provided
        for in Section 6(f).

      


      Except
        as
        specifically set forth in Section 9 hereof, the Company shall have no further
        obligations to Executive under this Agreement. 

      


      
        	 	
                (c)

              	
                By
                  the Company without Cause.
                  The Company may, without Cause, terminate Executive’s employment hereunder
                  at any time upon ten (10) or more days’ written notice to Executive. The
                  Company, in its sole discretion, may provide the Executive with
                  ten (10)
                  days’ pay in lieu of notice. In the event Executive’s employment is
                  terminated pursuant to this Section 6(c), the Employment Term shall
                  end on
                  the day of such termination and the Company shall pay to Executive,
                  no
                  later than the payroll cycle following Executive’s termination, in one
                  lump sum: (i) any accrued but unpaid Base Salary, less applicable
                  deductions, including salary in respect of any accrued and accumulated
                  vacation, due to Executive at the date of such termination, and
                  (ii) any
                  amounts owing, but not yet paid, pursuant to Section 5 hereof.
                  

              


      

       

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      In
        addition, upon a termination under this Section 6(c) and upon the satisfaction
        of the conditions set forth herein: (1) Executive shall receive a pro rata
        Bonus
        for the calendar year in which such termination occurs, equal to the Bonus
        he
        would have received, to the extent all criteria for such a Bonus have been
        met
        (with the exception of the requirement that Executive be employed on date
        the
        Bonus is to be paid), for the calendar year of said termination multiplied
        by a
        fraction, the numerator of which is the number of days in such year preceding
        and including the date of termination, and the denominator of which is 365.
        Said
        pro-rata Bonus shall be paid at the same time as the Bonus would have been
        paid
        had Executive remained employed by the Company through the date of payment,
        but
        in any event, not later than March 15 of the calendar year following the
        calendar year in which the Bonus is earned; (2) Executive shall receive any
        unpaid Bonus for the calendar year preceding his termination, to the extent
        that
        all criteria for such bonus have been met (with the exception of the Executive
        being employed on the date the Bonus is to be paid). Said Bonus shall be
        paid at
        the same time as the Bonus would have been paid had Executive remained employed
        by the Company through the date of payment; (3) Executive’s next-scheduled but
        unvested stock options granted pursuant to Section 3(c) of this Agreement
        shall
        vest immediately; (4) Executive’s next-scheduled but unvested stock granted
        pursuant to Section 3(d) of this Agreement shall vest immediately; and (5)
        Executive shall receive severance payments (the “Severance”) in an amount equal
        to the Executive’s annual Base Salary at the time of such termination of six
        months plus one week for every fully completed year of service, up to one
        year,
        and payable in regular installments in accordance with the Company’s usual
        payroll practices beginning thirty (30) days following Executive’s date of
        termination. The payment of the Bonuses and the Severance, as well as the
        acceleration of Executive’s options and stock, are conditioned upon Executive
        signing a release in favor of the Company, as provided for in Section
        6(f).

       

      Except
        as
        specifically set forth in Section 9 hereof, the Company shall have no further
        obligations to Executive under this Agreement. 

      


      
        	 	
                (d)

              	
                By
                  Executive for Good Reason.
                  If any of the events described below occurs during the Employment
                  Term,
                  Executive may terminate Executive's employment hereunder for Good
                  Reason
                  by written notice to the Company identifying the event or omission
                  constituting Good Reason not more than one (1) month following
                  the
                  occurrence of such event and, in the case of subclauses (ii), (iii),
                  or
                  (iv) below, a failure by the Company to cure such act or omission
                  within
                  thirty (30) days after receipt of such written notice. In the event
                  that
                  Executive elects to terminate employment pursuant to this Section
                  6(d),
                  the Employment Term and Executive's employment hereunder will be
                  terminated effective as of the later of thirty-one (31) days after
                  the
                  Company's receipt of Executive's notice of termination or thirty-one
                  (31)
                  days after the event, and Executive's termination for Good Reason
                  pursuant
                  to this Section 6(d) shall be treated for all purposes as a termination
                  without Cause pursuant to Section 6(c) and the provisions of Section
                  6(c)
                  shall apply to such termination. The occurrence of any of the following
                  events without Executive's consent shall permit Executive to terminate
                  Executive's employment for "Good Reason" pursuant to this Section
                  6(d):
                  

              


      

       

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      
        	 	
                (i)

              	
                A
                  "Change in Control" (as defined in Appendix A hereto) occurs;
                  

              


      

       

      
        	 	
                (ii)

              	
                The
                  failure by the Company to observe or comply in any material respect
                  with
                  any of the material provisions of this
                  Agreement;

              


      

       

      
        	 	
                (iii)

              	
                A
                  material diminution in Executive's
                  duties;

              


      

       

      
        	 	
                (iv)

              	
                The
                  assignment to Executive of duties that are materially inconsistent
                  with
                  Executive’s duties or that materially impair Executive’s ability to
                  function as the Vice President and Chief Operating Officer of the
                  Company;

              


      

       

      
        	 	
                (v)

              	
                The
                  relocation of Executive’s primary office from a location that is more than
                  twenty five (25) miles from both (a) the Company’s executive offices at
                  the time of relocation and (b) Executive’s primary residence at the time
                  of such relocation; or

              


      

       

      
        	 	
                (vi)

              	
                The
                  Company providing Executive with a notice of non-renewal of this
                  Agreement
                  by the Company under Section 1.

              


      

       

      Except
        as
        specifically set forth in Section 9 hereof, the Company shall have no further
        obligations to Executive under this Agreement. 

      


      
        	 	
                (e)

              	
                By
                  Executive without Good Reason.
                  Executive may terminate the Employment Term and Executive's employment
                  hereunder at any time without Good Reason upon thirty (30) days
                  advance
                  written notice to the Company. In the event Executive's employment
                  is
                  terminated pursuant to this Section 6(e), the Company shall pay
                  to
                  Executive, no later than ten (10) days after the last day of Executive's
                  employment, in one lump sum, the sum of (i) any accrued but unpaid
                  Base
                  Salary, less applicable deductions, including salary in respect
                  of any
                  accrued and accumulated vacation, due to Executive at the date
                  of such
                  termination, and (ii) any amounts owing, but not yet paid, pursuant
                  to
                  Section 5 hereof. 

              


      

       

      Except
        as
        specifically set forth in Section 9 hereof, the Company shall have no further
        obligations to Executive under this Agreement. 

      


      
        	 	
                (f)

              	
                Release.
                  Notwithstanding any other provision of this Agreement to the contrary,
                  Executive acknowledges and agrees that any and all payments and
                  benefits
                  to which Executive is entitled under this Section 6(b), 6(c), or
                  6(d),
                  with the exception of accrued salary, accrued vacation payments,
                  and
                  payments pursuant to Section 5 of this Agreement, are conditioned upon and
                  subject to Executive's first executing a Confidential Separation
                  Agreement
                  including a general waiver and release (and the expiration of any
                  associated revocation period), in such reasonable and customary
                  form as
                  shall be prepared by the Company, of all claims Executive may have
                  against
                  the Company, and related entities and individuals.
                  

              


      

       

      
        
          
          

        

        
          7

          
            

          

        

        
          
          

        

      

      
        	
                7.

              	
                Required
                  Postponement for Specified
                  Services.

              


      

       

      
        	 	
                (a)

              	
                Specified
                  Executive Delay.
                  Notwithstanding anything in this Agreement to the contrary, if
                  required by
                  section 409A of the Internal Revenue Code of 1986, as amended (the
“Code”)
                  and if Executive is considered a Specified Executive (as defined
                  herein)
                  and payment of any amounts under this Agreement is required to
                  be delayed
                  for a period of six months after separation from service pursuant
                  to
                  Section 409A of the Code, payment of such amounts shall be delayed
                  as
                  required by section 409A, and the accumulated amounts shall be
                  paid in a
                  lump sum payment within five days after the end of the six-month
                  period.
                  If Executive dies during the postponement period prior to the payment
                  of
                  benefits, the amounts withheld on account of section 409A shall
                  be paid to
                  the personal representative of Executive’s estate within 60 days after the
                  date of Executive’s death. 

              


      

       

      
        	 	
                (b)

              	
                “Specified
                  Executive”
                  shall mean an employee who, at any time during the 12-month period
                  ending
                  on the identification date, is a “specified employee” under section 409A
                  of the Code, as determined by the Compensation Committee of the
                  Board or
                  its delegate. The determination of Specified Executives, including
                  the
                  number and identity of persons considered officers and the identification
                  date, shall be made by the Compensation Committee or its delegate
                  in
                  accordance with the provisions of section 409A of the Code and
                  the
                  regulations issued thereunder.

              


      

       

      
        	
                8.

              	
                No
                  Mitigation; Employee Benefit Plans.
                  Executive shall not be required to mitigate amounts payable to
                  him under
                  this Agreement by seeking other employment or otherwise, and there
                  shall
                  be no offset against amounts payable to Executive under this Agreement
                  on
                  account of Executive's subsequent employment. Amounts payable to
                  Executive
                  under this Agreement shall not be offset by any claims that the
                  Company
                  may have against Executive, and such amounts payable to Executive
                  under
                  this Agreement shall not be affected by any other circumstances,
                  including, without limitation, any counterclaim, recoupment, defense,
                  or
                  other right that the Company may have against Executive or others.
                  Provided,
                  however,
                  that,
                  payments made to Executive as a result of the termination of Executive's
                  employment hereunder shall not be considered as includible compensation
                  with respect to any employee benefit plans maintained by the Company,
                  except to the extent otherwise required by law.


              


      

       

      
        
          
          

        

        
          8

          
            

          

        

        
          
          

        

      

      
        	
                9.

              	
                Indemnification.
                  In the event that Executive is made a party or threatened to be
                  made a
                  party to any action, suit, or proceeding, whether civil, criminal,
                  administrative, or investigative (a "Proceeding"), by reason of
                  Executive's employment with, or serving as an officer of, the Company,
                  the
                  Company shall indemnify and hold Executive harmless, and defend
                  Executive
                  to the fullest extent authorized by the laws of the state in which
                  the
                  Company is incorporated, as the same exist and may hereafter be
                  amended,
                  against any and all claims, demands, suits, judgments, assessments,
                  and
                  settlements (collectively the "Claims"), including all expenses
                  incurred
                  or suffered by Executive in connection therewith (excluding, however,
                  any
                  legal fees incurred by Executive for Executive's own counsel, except
                  as
                  otherwise provided in this Section 9, and excluding any Proceedings
                  initiated by executive), and such indemnification shall continue
                  as to
                  Executive even after Executive is no longer employed by the Company
                  hereunder, and shall inure to the benefit of Executive's heirs,
                  executors,
                  and administrators; provided,
                  however,
                  that,
                  Executive promptly gives written notice to the Company of any such
                  Claims
                  (although Executive's failure to promptly give notice shall not
                  affect the
                  Company's obligations under this Section 9 except to the extent
                  that such
                  failure prejudices the Company or its ability to defend such Claims).
                  The
                  Company shall have the right to undertake, with counsel or other
                  representatives of its own choosing, the defense or settlement
                  of any
                  Claims. In the event that the Company shall fail to notify Executive,
                  within ten days of its receipt of Executive's written notice, that
                  the
                  Company has elected to undertake such defense or settlement, or
                  if at any
                  time the Company shall otherwise fail to diligently defend or pursue
                  settlement of such Claims, then Executive shall have the right
                  to
                  undertake the defense, compromise, or settlement of such Claims,
                  in which
                  event the Company shall hold Executive harmless from any legal
                  fees
                  incurred by Executive for Executive's counsel. Neither Executive
                  nor the
                  Company shall settle any Claims without the prior written consent
                  of the
                  other, which consent shall not be unreasonably withheld or delayed.
                  In the
                  event that the Company submits to Executive a bona fide settlement
                  offer
                  from the claimant of Claims (which settlement offer shall include
                  as an
                  unconditional term thereof the giving by the claimant or the plaintiff
                  to
                  Executive a release from all liability in respect of such Claims),
                  and
                  Executive refuses to consent to such settlement, then thereafter
                  the
                  Company's liability to Executive for indemnification hereunder
                  with
                  respect to such Claims shall not exceed the settlement amount included
                  in
                  such bona fide settlement offer, and Executive shall either assume
                  the
                  defense of such Claims or pay the Company's attorneys' fees and
                  other
                  out-of-pocket costs incurred thereafter in continuing the defense
                  of such
                  Claims. Regardless of which party is conducting the defense of
                  any such
                  Claims, the other party, with counsel or other representatives
                  of its own
                  choosing and at its sole cost and expense, shall have the right
                  to consult
                  with the party conducting the defense of such Claims and its counsel
                  or
                  other representatives concerning such Claims and Executive and
                  the
                  respective counsel or other representatives shall cooperate with
                  respect
                  to such Claims. The party conducting the defense of any such Claims
                  and
                  its counsel shall in any case keep the other party and its counsel
                  (if
                  any) fully informed as to the status of such Claims and any matters
                  relating thereto. Executive and the Company shall provide to the
                  other
                  such records, books, documents, and other materials as shall reasonably
                  be
                  necessary for each to conduct or evaluate the defense of any Claims,
                  and
                  will generally cooperate with respect to any matters relating thereto.
                  This Section 9 shall remain in effect after this Agreement is terminated,
                  regardless of the reasons for such termination. The indemnification
                  provided to Executive pursuant to this Section 9 shall not supersede
                  or
                  reduce any indemnification provided to Executive under any separate
                  agreement, or the By-Laws of the Company; in this regard, it is
                  intended
                  that this Agreement shall expand and extend Executive's rights
                  to receive
                  indemnification. 

              


      

       

      
        	
                10.

              	
                Withholding.
                  The Company shall have the right to deduct and withhold from all
                  payments
                  to Executive hereunder all payroll taxes, income tax withholding
                  and other
                  federal, state and local taxes and charges which currently are
                  or which
                  hereafter may be required by law to be so deducted and withheld.
                  

              


      

       

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      
        	
                11.

              	
                Restrictive
                  Covenants.
                  The restrictive covenants contained in the Non-Disclosure and Inventions
                  Agreement, signed by Executive on October 31, 2007 and attached
                  hereto as
                  Appendix B, including but not limited to, Section 2 (Confidential
                  Material); Section 3 (Non-Solicitation); Section 4 (Non-Compete),
                  and
                  Section 5 (Intellectual Property and Inventions) are incorporated
                  by
                  reference as if fully set forth herein. Executive hereby reaffirms
                  his
                  obligations under that agreement.

              


      

       

      
        	
                12.

              	
                Non-Assignability.
                  Executive's rights and benefits hereunder are personal to Executive,
                  and
                  shall not be alienated, voluntarily or involuntarily assigned,
                  or
                  transferred. 

              


      

       

      
        	
                13.

              	
                Binding
                  Effect.
                  This Agreement shall be binding upon the parties hereto, and their
                  respective assigns, successors, executors, administrators, and
                  heirs. In
                  the event the Company becomes a party to any merger, consolidation,
                  or
                  reorganization, this Agreement shall remain in full force and effect
                  as an
                  obligation of the Company or its successor(s) in interest. None
                  of the
                  payments provided for by this Agreement shall be subject to seizure
                  for
                  payment of any debts or judgments against Executive or Executive's
                  beneficiary or beneficiaries, nor shall Executive or any such beneficiary
                  or beneficiaries have any right to transfer or encumber any right
                  or
                  benefit hereunder. 

              


      

       

      
        	
                14.

              	
                Entire
                  Agreement; Modification.
                  

              


      

       

      
        	 	
                (a)

              	
                This
                  Agreement supersedes all prior agreements, with the exception of
                  the
                  Non-Disclosure and Inventions Agreement, and all other agreements
                  (or
                  portions thereof) that deal with confidentiality or intellectual
                  property.
                  This Agreement sets forth the entire understanding among the parties
                  hereto with respect to the subject matter hereof, may not be changed
                  orally, and may be changed only by an agreement in writing signed
                  by the
                  parties hereto. 

              


      

       

      
        	 	
                (b)

              	
                Executive
                  acknowledges that from time to time, the Company may establish,
                  maintain
                  and distribute manuals, handbooks or personnel policies, and officers
                  or
                  other representatives of the Company may make written or oral statements
                  relating to personnel policies and procedures. Such manuals, handbooks
                  and
                  statements are intended only for general guidance. No policies,
                  procedures
                  or statements of any nature by or on behalf of the Company (whether
                  written or oral, and whether or not contained in any manual or
                  handbook or
                  personnel policies), and no acts or practices of any nature, shall
                  be
                  construed to modify this Agreement or to create express or implied
                  obligations of any nature to
                  Executive.

              


      

      


      
        	
                15.

              	
                Notices.
                  All notices and communications hereunder shall be in writing, sent
                  by
                  certified or registered mail, return receipt requested, postage
                  prepaid;
                  by facsimile transmission, with proof of the time and date of receipt
                  retained by the transmitter; or by hand-delivery properly receipted.
                  The
                  actual date of receipt as shown by the return receipt therefore,
                  the
                  facsimile transmission sheet, or the hand-delivery receipt, as
                  the case
                  may be, shall determine the date on which (and, in the case of
                  a
                  facsimile, the time at which) notice was given. All payments required
                  hereunder by the Company to Executive shall be sent postage prepaid,
                  or,
                  at Executive's election, shall be transferred to Executive electronically
                  to such bank account as Executive may designate in writing to the
                  Company,
                  including designation of the applicable electronic address. The
                  foregoing
                  items (other than any electronic transfer to Executive) shall be
                  addressed
                  as follows (or to such other address as the Company and Executive
                  may
                  designate in writing from time to time):


              


      

       

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      To
        the
        Company: 

      NexMed,
        Inc. 

      89
        Twin
        Rivers Drive

      East
        Windsor, NJ 08520

      Fax:
        609-426-9116

      Attention:
        Chief Executive Officer

      


      To
        Executive: 

      Hemanshu
        Pandya

      7
        Nottinghill Court

      Manalapan,
        N.J. 07726

      Fax:
        732-294-0301

      


      
        	
                16.

              	
                Section
                  409A of the Code.
                  This Agreement is intended to comply with section 409A of the Code
                  and its
                  corresponding regulations, to the extent applicable. Notwithstanding
                  anything in this Agreement to the contrary, payments may only be
                  made
                  under this Agreement upon an event and in a manner permitted by
                  section
                  409A of the Code, to the extent applicable. As used in the Agreement,
                  the
                  term “termination of employment” shall mean Executive’s separation from
                  service with the Company within the meaning of section 409A of
                  the Code
                  and the regulations promulgated thereunder. For purposes of section
                  409A,
                  the right to a series of payments under the Agreement shall be
                  treated as
                  a right to a series of separate payments. All reimbursements and
                  in-kind
                  benefits provided under the Agreement shall be made or provided
                  in
                  accordance with the requirements of section 409A of the Code, including,
                  where applicable, the requirement that (i) any reimbursement shall
                  be for
                  expenses incurred during Executive’s lifetime (or during a shorter period
                  of time specified in this Agreement), (ii) the amount of expenses
                  eligible
                  for reimbursement, or in-kind benefits provided, during a calendar
                  year
                  may not affect the expenses eligible for reimbursement, or in-kind
                  benefits to be provided, in any other calendar year, (iii) the
                  reimbursement of an eligible expense will be made on or before
                  the last
                  day of the calendar year following the year in which the expense
                  is
                  incurred, and (iv) the right to reimbursement or in-kind benefits
                  is not
                  subject to liquidation or exchange for another
                  benefit.

              


      

       

      
        	
                17.

              	
                Governing
                  Law; Jurisdiction.
                  This Agreement shall be governed by, and construed and enforced
                  according
                  to, the domestic laws of the State of New Jersey without giving
                  effect to
                  the principles of conflict of laws thereof, or such principles
                  of any
                  other jurisdiction, which could cause the application of the substantive
                  law of any jurisdiction other than the State of New Jersey. The
                  Company
                  and Executive agree that the state or federal courts of New Jersey
                  shall
                  have exclusive jurisdiction to hear and determine any dispute which
                  may
                  arise under this Agreement. 

              


      

       

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      
        	
                18.

              	
                Severability.
                  The invalidity or unenforceability of any provision of this Agreement
                  shall not affect the validity or enforceability of any other provision
                  of
                  this Agreement, and each other provision of the Agreement shall
                  be
                  severable and enforceable to the extent permitted by law.
                  

              


      

       

      
        	
                19.

              	
                Headings.
                  The headings of the Sections hereof are provided for convenience
                  only and
                  are not to serve as a basis for interpretation or construction,
                  and shall
                  not constitute a part, of this Agreement.


              


      

       

      
        	
                20.

              	
                Signature
                  in Counterparts.
                  This Agreement may be signed in counterparts, each of which shall
                  be an
                  original, with the same effect as if the signatures thereto and
                  hereto
                  were upon the same instrument. 

              


      

       

      IN
        WITNESS WHEREOF, Executive has hereunto set his hand and the Company has
        caused
        this Agreement to be executed in its name on its behalf, all as of the day
        and
        year first above written. 

      
 

      
        	 	
                /s/
                  Hemanshu
                  Pandya                                          
                  

              
	 	
                Hemanshu
                  Pandya

              
	 	 
	 	 
	 	 
	 	
                NEXMED,
                  INC.

              
	 	 
	 	 
	 	
                By:
                  /s/ Vivian H.
                  Liu                                             
                  

              
	 	
                Title:
                  President and Chief Executive
                  Officer

              


      

      


      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      


      Appendix
        A

      Change
        in Control

      


      For
        the
        purpose of this Agreement, a "Change in Control" shall be deemed to have
        taken
        place if: 

      


      A. Individuals
        who, on the date hereof, constitute the Board (the "Incumbent Directors")
        cease
        for any reason to constitute at least a majority of the Board, provided that
        any
        person becoming a director subsequent to the date hereof, whose election
        or
        nomination for election was approved by a vote of at least two-thirds of
        the
        Incumbent Directors then on the Board (either by a specific vote or by approval
        of the proxy statement of the Company in which such person is named as a
        nominee
        for director, without written objection to such nomination) shall be an
        Incumbent Director; provided,
        however,
        that,
        no
        individual initially elected or nominated as a director of the Company as
        a
        result of an actual or threatened election contest with respect to directors
        or
        as a result of any other actual or threatened solicitation of proxies or
        consents by or on behalf of any person other than the Board shall be deemed
        to
        be an Incumbent Director; 

      


      B. Any
        "Person" (as such term is defined in Section 3(a)(9) of the Securities Exchange
        Act of 1934 (the "Exchange Act") and as used in Sections 13(d)(3) and 14(d)(2)
        of the Exchange Act) is or becomes a "beneficial owner" (as defined in Rule
        13d-3 under the Exchange Act), directly or indirectly, of securities of the
        Company representing 25% or more of the combined voting power of the Company's
        then outstanding securities eligible to vote for the election of the Board
        (the
        "Voting Securities"); provided,
        however,
        that,
        the
        event described in this paragraph B shall not be deemed to be a Change in
        Control by virtue of any of the following acquisitions: (i) by the Company
        or
        any subsidiary of the Company in which the Company owns more than 25% of
        the
        combined voting power of such entity (a "Subsidiary"), (ii) by any employee
        benefit plan (or related trust) sponsored or maintained by the Company or
        any
        Subsidiary, (iii) by any underwriter temporarily holding the Company's Voting
        Securities pursuant to a public offering of such Voting Securities, (iv)
        pursuant to a Non-Qualifying Transaction (as defined in paragraph C immediately
        below), (v) pursuant to any acquisition by Executive or by any Person which
        is
        an "affiliate" (within the meaning of 17 C.F.R. § 230.405) of Executive (an
        "Excluded Person"); 

      


      C. The
        consummation of a merger, consolidation, statutory share exchange or similar
        form of corporate transaction involving the Company or any of its Subsidiaries
        that requires the approval of the Company's stockholders, whether for such
        transaction or the issuance of securities in the transaction (a "Business
        Combination"), unless immediately following such Business Combination: (i)
        more
        than 25% of the total voting power of (A) the corporation resulting from
        such
        Business Combination (the "Surviving Corporation"), or (B) if applicable,
        the
        ultimate parent corporation that directly or indirectly has beneficial ownership
        of 100% of the voting securities eligible to elect directors of the Surviving
        Company (the "Parent Corporation"), is represented by the Company's Voting
        Securities that were outstanding immediately prior to such Business Combination
        (or, if applicable, is represented by shares into which the Company's Voting
        Securities were converted pursuant to such Business Combination), and such
        voting power among the holders thereof is in substantially the same proportion
        as the voting power of the Company's Voting Securities among the holders
        thereof
        immediately prior to the Business Combination, (ii) no Person (other than
        (A)
        any employee benefit plan (or related trust) sponsored or maintained by the
        Surviving Corporation or the Parent Corporation or (B) an Excluded Person
        is or
        becomes the beneficial owner, directly or indirectly, of 25% or more of the
        total voting power of the outstanding voting securities eligible to elect
        directors of the Parent Corporation (or, if there is no Parent Corporation,
        the
        Surviving Corporation) and (iii) at least a majority of the members of the
        board
        of directors of the Parent Corporation (or, if there is no Parent Corporation,
        the Surviving Corporation) following the consummation of the Business
        Combination were Incumbent Directors at the time of the Board's approval
        of the
        execution of the initial agreement providing for such Business Combination
        (any
        Business Combination which satisfies all of the criteria specified in (i),
        (ii)
        and (iii) above shall be deemed to be a "Non-Qualifying Transaction");


      


      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      D. A
        sale of
        all or substantially all of the Company's assets, other than to an Excluded
        Person; 

      


      E. The
        stockholders of the Company approve a plan of complete liquidation or
        dissolution of the Company; or 

      


      F. Such
        other events as the Board may designate. 

      


      Notwithstanding
        the foregoing, a Change in Control of the Company shall not be deemed to
        occur
        solely because any person acquires beneficial ownership of more than 25%
        of the
        Company's Voting Securities as a result of the acquisition of the Company's
        Voting Securities by the Company which reduces the number of the Company's
        Voting Securities outstanding; provided,
        that,
        if
        after such acquisition by the Company such person becomes the beneficial
        owner
        of additional Company Voting Securities that increases the percentage of
        outstanding Company Voting Securities beneficially owned by such person,
        a
        Change in Control of the Company shall then occur.

      


      


      


      


      
        
          
          

        

        
          14