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                                                                   Exhibit 10.16

                               GENZYME CORPORATION

                         1998 DIRECTOR STOCK OPTION PLAN

1.   GENERAL; PURPOSE.

     This 1998 Director Stock Option Plan dated March 6, 1998 (the "Plan")
governs options to purchase common stock, $0.01 par value (the "Stock"), of
Genzyme Corporation (the "Company") granted on or after the date hereof by the
Company to members of the Board of Directors (each, a "Director") of the Company
(the "Board") who are not also officers or employees of the Company. The Plan
constitutes an amendment and restatement of the Company's 1988 Director Stock
Option Plan (the "Prior Plan") and supersedes the Prior Plan, the separate
existence of which shall terminate on the effective date of this Plan. The
rights and privileges of holders of options outstanding under the Prior Plan
shall not be adversely affected by the foregoing action.

     The purpose of the Plan is to attract and retain qualified persons to serve
as Directors of the Company and to encourage ownership of stock of the Company
by such Directors so as to provide additional incentives to promote the success
of the Company.

2.   ADMINISTRATION OF THE PLAN; GOVERNING LAW.

     Grants of stock options under the Plan shall be automatic as provided in
Section 7. However, all questions of interpretation with respect to the Plan and
options granted under it shall be determined by a committee consisting of all
Directors of the Company who are not eligible to participate in the Plan, and
such determination shall be final and binding upon all persons having an
interest in the Plan. This Plan shall be governed by and interpreted in
accordance with the laws of The Commonwealth of Massachusetts.

3.   PERSONS ELIGIBLE TO PARTICIPATE IN THE PLAN.

     Members of the Board who are not also officers or employees of the Company
shall be eligible to participate in the Plan.

4.   SHARES SUBJECT TO THE PLAN.

     (a) An aggregate of 1,162,491 shares of Stock may be issued upon exercise
of options granted under this Plan. In the event of a stock dividend, split-up,
combination or reclassification of shares, recapitalization or other similar
capital change relating to the Stock, the maximum aggregate number and kind of
shares or securities of the Company as to which options may be granted under
this Plan and as to which options then outstanding shall be exercisable, and the
option price of such options, shall be appropriately adjusted by the Board
(whose determination shall be conclusive) so as to preserve the value of the
option.

     (b) In the event of a consolidation or merger of the Company with another
corporation where the Company's stockholders do not own a majority in interest
of the surviving or resulting corporation, or the sale or exchange of all or
substantially all of the assets of the Company, or a reorganization or
liquidation of the Company, any deferred exercise period shall be automatically
accelerated and each holder of an outstanding option shall be entitled to
receive upon exercise and payment in accordance with the terms of the option the
same shares, securities or property as he or she would have been entitled to
receive upon the occurrence of such event if he or she had been, immediately
prior to such event, the holder of the number of shares of Stock purchasable
under his or her option or, if another corporation shall be the survivor, such
corporation shall substitute therefor substantially equivalent shares,
securities or property of such other corporation; provided, however, that in
lieu of the foregoing the Board may make such other provision as it may consider
equitable to holders and in the best interests of the Company.

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     (c) Whenever options under this Plan (including options outstanding under
the Prior Plan as of the effective date of this Plan) lapse or terminate or
otherwise become unexercisable, the shares of Stock which were subject to such
options may again be subjected to options under this Plan. The Company shall at
all times while this Plan is in force reserve such number of shares of Stock as
will be sufficient to satisfy the requirements of this Plan.

5.   NONSTATUTORY STOCK OPTIONS.

     All options granted under this Plan shall be nonstatutory options not
entitled to special tax treatment under Section 422 of the Internal Revenue Code
of 1986, as amended (the "Code").

6.   FORM OF OPTIONS.

     Options granted hereunder shall be in such form as the Board may from time
to time determine.

7.   GRANT OF OPTIONS AND OPTION TERMS.

     (a) AUTOMATIC GRANT OF OPTIONS. At each annual meeting of the stockholders
of the Company, those Directors who are eligible to receive options under this
Plan shall automatically be granted options to purchase 15,000 shares of Stock.
In addition, upon the election of an eligible Director under this Plan other
than at an annual meeting of stockholders (whether by the Board or the
stockholders and whether to fill a vacancy or otherwise), such Director shall
automatically be granted options to purchase the number of shares of Stock
described in the preceding sentence for each year or portion thereof of the term
of office to which he or she is elected. The "Date of Grant" for options granted
under this Plan shall be the date of the annual meeting of shareholders, or the
election as a Director, as the case may be. No options shall be granted
hereunder after ten years from the date on which this Plan was initially
approved and adopted by the Board. As used herein, "Fair Market Value" for the
Stock shall mean the closing sale price of the Stock as reported by the Nasdaq
National Market or the principal securities exchange or over-the-counter market
on which the Stock is listed or quoted on the Date of Grant of such options or,
if the Stock is not then listed on the Nasdaq National Market or any securities
exchange or quoted in the over-the-counter market, the fair market value of the
Stock as determined in good faith by the Board.

     (b) OPTION PRICE. The option price per share for each option granted under
this Plan shall be equal to the Fair Market Value of the Stock with respect to
which the option is exercisable.

     (c) TERM OF OPTION. The term of each option granted under this Plan shall
be ten years from the Date of Grant.

     (d) PERIOD OF EXERCISE. Options granted under this Plan shall become
exercisable on the date of the next annual meeting of shareholders following
their Date of Grant, if and only if the option holder is a member of the Board
at the opening of business on that date. Directors holding exercisable options
under this Plan who cease to serve as members of the Board may, during their
lifetime, exercise the rights they had under such options at the time they
ceased being a Director for the full unexpired term of such option. Upon the
death of a Director, those entitled to do so under the Director's will or the
laws of descent and distribution shall have the right, at any time within twelve
months after the date of death, to exercise in whole or in part any rights which
were available to the Director at the time of his or her death. Options granted
under this Plan shall terminate,

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and no rights thereunder may be exercised, after the expiration of the
applicable exercise period. Notwithstanding the foregoing provisions of this
section, no rights under any options may be exercised after the expiration of
ten years from their Date of Grant.

     (e) METHOD OF EXERCISE AND PAYMENT. Options may be exercised only by
written notice to the Company at its head office accompanied by payment of the
full option price for the shares of Stock as to which they are exercised. The
option price shall be paid in cash or by check. Upon receipt of such notice and
payment, the Company shall promptly issue and deliver to the optionee (or other
person entitled to exercise the option) a certificate or certificates for the
number of shares as to which the exercise is made.

     (f) TRANSFERABILITY. Options granted under this Plan may be transferred
without consideration (or for such consideration as the committee may from time
to time deem appropriate) by the holder thereof to any Family Member of such
director; PROVIDED, HOWEVER, that no subsequent transfer of such option shall be
permitted except for transfers: (i) to a Family Member of such director; (ii)
back to the director; or (iii) pursuant to the applicable laws of descent and
distribution. For this purpose, "Family Member" shall mean (i) any child,
stepchild, grandchild, parent, stepparent, grandparent, spouse, former spouse,
sibling, niece, nephew, mother-in-law, father-in-law, son-in-law,
daughter-in-law, brother-in-law or sister-in-law, including any adoptive
relationships, and any other person sharing the transferor director's household
(other than as a tenant or employee); (ii) any trust in which any of the persons
described in clause (i) holds a greater than 50% beneficial interest; (iii) any
foundation in which any of the persons described in clause (i) or the transferor
director controls the management of assets; or (iv) any other entity in which
any of the persons described in clause (i) or the director holds more than 50%
of the voting interests.

     (g) AMENDMENT. In addition to the rights set forth in Section 4(b) of this
Plan, the Board may amend or modify any outstanding option in any respect,
provided that the optionee's consent to such action shall be required unless the
Board determines that the action, taking into account any related action, would
not materially and adversely affect the optionee.

8.   LIMITATION OF RIGHTS.

     (a) NO RIGHT TO CONTINUE AS A DIRECTOR. Neither this Plan, nor the granting
of an option or any other action taken pursuant to this Plan, shall constitute
an agreement or understanding, express or implied, that the Company will retain
an optionee as a Director for any period of time or at any particular rate of
compensation.

     (b) NO STOCKHOLDERS' RIGHTS FOR OPTIONS. Directors shall have no rights as
a stockholder with respect to the shares covered by their options until the date
they exercise such options and pay the option price to the Company, and no
adjustment will be made for dividends or other rights for which the record date
is prior to the date such option is exercised and paid for.

9.   EFFECTIVE DATE; AMENDMENT OR TERMINATION.

     Subject to the approval of the stockholders of the Company, this Plan shall
be effective as of March 6, 1998. Prior to such approval, options may be granted
under this Plan expressly subject to such approval. The Board may amend or
terminate this Plan at any time, subject to any stockholder approval that the
Board determines to be necessary or advisable.

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10.  STOCKHOLDER APPROVAL.

     This Plan is subject to approval by the stockholders of the Company by the
affirmative vote of the holders of a majority of the votes properly cast by
holders of the shares of Stock of the Company present, or represented and
entitled to vote, at a meeting duly held in accordance with the laws of The
Commonwealth of Massachusetts. In the event such approval is not obtained, all
options granted under this Plan shall be void and without effect.