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                                                                  EXHIBIT 10.20



          AMENDMENT NO. 1 TO PRODUCT DEVELOPMENT AND SUPPLY AGREEMENT

         THIS AMENDMENT NO. 1, is entered into as of May 3, 2000 by and between
PENWEST PHARMACEUTICALS CO., a Washington corporation, with a principal place
of business at 2981 Route 22, Patterson, New York 12563 ("Penwest") and FIRST
HORIZON PHARMACEUTICAL CORPORATION, a Delaware corporation, with a principal
place of business at 660 Hembree Parkway, Suite 106, Roswell, GA 30076
("Horizon").

                              W I T N E S S E T H:

         WHEREAS, Penwest and Horizon have heretofore entered into a Product
Development and Supply Agreement dated as of March 25, 1999 (the "Agreement");
and

         WHEREAS, Penwest and Horizon desire to amend certain provisions of the
Agreement as hereinafter set forth; and

         WHEREAS, Section 12.5 of the Agreement provides that modifications may
be made to the Agreement provided that they are reduced to writing and signed
by duly authorized representative by each of the parties;

         NOW, THEREFORE, it is agreed by the parties as follows:

         1.       In Section 12.3 of the Agreement entitled "Assignment"
Subsection (b) is hereby deleted and the following is substituted in its place:

                  "...(b) nine (9) months following such assignment or
                  delegation, (i) such right shall become ineffective
                  and (ii) Horizon shall terminate any such assignment
                  or delegation, unless Inpharmakon has (A) within six
                  (6) months identified in writing to Penwest one or
                  more qualified third parties that have a sales
                  force, whether their own or contracted, in the
                  Territory of at least 133 sales personnel or a
                  substantially equivalent sales and distribution
                  capability, and (B) within nine (9) months obtained
                  a binding contract to market and sell the Designated
                  Product in the Territory which binding contract
                  shall be with a third party that does not
                  manufacture, market or promote any oral, controlled
                  release delivery product, except that Inpharmakon
                  may contract with a contract manufacturer that
                  manufactures such a delivery product if such
                  manufacturer agrees to be bound by the
                  confidentiality conditions that bind Horizon under
                  Section 8.1 of this Agreement and provided further
                  that if Penwest reasonably objects to such
                  manufacturer, Penwest shall have the right to
                  provide Inpharmakon with an acceptable substitute
                  contract manufacturer on terms substantially
                  equivalent to the terms



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                  Inpharmakon has negotiated with the manufacturer to whom
                  Penwest has objected.

         2.       In the sentence following Subsection (b) in Section 12.3 of
the Agreement, the reference to "six (6) month period" is hereby deleted and
the phrase "nine (9) month period" is substituted in its place.

         3.       In all other respects the Agreement is hereby ratified and
confirmed.

         IN WITNESS WHEREOF, the parties have executed this Amendment No. 1 as
of the day and date first above written.


PENWEST PHARMACEUTICALS CO.              FIRST HORIZON PHARMACEUTICAL
                                         CORPORATION



By:                                      By:
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Its:                                     Its:
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