<PAGE>
                                                                    EXHIBIT 4.2
<PAGE>
                                                                               .
                                                                               .
                                                                               .

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                       PAGE
<S>                                                                    <C>
1.       Demand Registrations......................................     2

         (a)      Requests for Registration........................     2

         (b)      Number of Demand Registrations...................     2

         (c)      Short-Form Registrations.........................     3

         (d)      Priority on Demand Registrations.................     3

         (e)      Restrictions on Demand Registrations.............     4

         (f)      Selection of Underwriters........................     5

         (g)      Other Registration Rights........................     5

2.       Piggyback Registrations...................................     6

         (a)      Right to Piggyback...............................     6

         (b)      Piggyback Expenses...............................     6

         (c)      Priority on Primary Registrations................     6

         (d)      Priority on Secondary Registrations..............     6

         (e)      Selection of Underwriters........................     7

3.       Holdback Agreements.......................................     7

4.       Registration Procedures...................................     7

5.       Registration Expenses.....................................     9

6.       Indemnification...........................................    10

         (e)      Contribution.....................................    11

7.       Rule 144..................................................    12

8.       Participation in Underwritten Registrations...............    12

9.       Definitions...............................................    12

10.      Miscellaneous.............................................    13

         (a)      No Inconsistent Agreements.......................    13

         (b)      Adjustments Affecting Registrable Securities.....    14

         (c)      Remedies.........................................    14

         (d)      Amendments and Waivers...........................    14

         (e)      Successors and Assigns...........................    14

         (f)      Severability.....................................    14

         (g)      Counterparts.....................................    14
</TABLE>

                                       i.

<PAGE>

                                TABLE OF CONTENTS
                                   (CONTINUED)

<TABLE>
<CAPTION>
                                                                       PAGE
<S>                                                                    <C>
         (h)      Descriptive Headings.............................    15

         (i)      Governing Law....................................    15

         (j)      Notices..........................................    15

         (k)      Termination......................................    17
</TABLE>

                                       ii.

<PAGE>



               AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT

         THIS AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT (this
"AGREEMENT") is made as of June 20, 2002 by and among ANADYS PHARMACEUTICALS,
INC., a Delaware corporation (the "COMPANY"), CARE CAPITAL, LLC ("CARE CAPITAL")
and all other purchasers of the Series C Convertible Preferred Stock, par value
$.01 per share (the "SERIES C PREFERRED STOCK"), of the Company pursuant to the
Series C Convertible Preferred Stock Purchase Agreement (the "PURCHASE
AGREEMENT") dated as of the date hereof (collectively with Care Capital, the
"SERIES C STOCKHOLDERS"), SGC Partners I, LLC, SG Cowen Ventures I, L.P.
(collectively "SGCP") and all other holders of the Company's Series B Preferred
Stock, par value $.01 per share (collectively with SGCP, the "SERIES B
STOCKHOLDERS"), Societe Financiere d'Innovation, Sofinov, Biomedicine, L.P.,
Aventis, S.A. and Bristol-Myers Squibb Pharma Company (collectively, the "SERIES
A-5 STOCKHOLDERS"), Shire Pharmaceuticals Group plc (the "SERIES A-4
STOCKHOLDER"), the holders of shares of the Company's Series A-3 Preferred
Stock, par value $.01 per share (the "SERIES A-3 STOCKHOLDERS"), the holders of
shares of the Series A-2 Preferred Stock, par value $.01 per share (the "SERIES
A-2 STOCKHOLDERS"), the holders of shares of the Series A-1 Preferred Stock, par
value $.01 per share (the "SERIES A-1 STOCKHOLDERS" and together with the Series
A-2 Stockholders, Series A-3 Stockholders, Series A-4 Stockholders and Series
A-5 Stockholders, the "SERIES A STOCKHOLDERS"), each as listed on SCHEDULE A
attached hereto, and each of the persons listed on SCHEDULE B attached hereto
(the "ASKLIPIOS STOCKHOLDERS," and collectively with the Series C Stockholders,
the Series B Stockholders and the Series A Stockholders, the "STOCKHOLDERS").

                                    RECITALS

         A.       In connection with the purchase of the shares of Preferred
Stock of the Company by the Series B Stockholders, the Company, the Series B
Stockholders, certain of the Series A Stockholders and the Asklipios
Stockholders entered into that certain Amended and Restated Registration Rights
Agreement, dated as of December 5, 2000 (the "DECEMBER 2000 REGISTRATION RIGHTS
AGREEMENT"), which December 2000 Registration Rights Agreement amended and
restated that certain Registration Rights Agreement dated as of May 22, 2000 by
and among the Company and certain stockholders of the Company (the "MAY 2000
REGISTRATION RIGHTS AGREEMENT").

         B.       The Company and the Series C Stockholders are parties to the
Purchase Agreement.

         C.       In order to induce the Series C Stockholders to enter into the
Purchase Agreement, the Company has agreed to provide the Series C Stockholders
certain registration rights as set forth herein.

         D.       The parties hereto desire to amend and restate the December
2000 Registration Rights Agreement as provided herein. Unless otherwise provided
in this Agreement, capitalized terms used herein shall have the meanings set
forth in Section 9 hereof.

                                       1.
<PAGE>

         E.       By executing and delivering this Agreement, the Company and
the Stockholders have approved the amendment, restatement and termination of (i)
the December 2000 Registration Rights Agreement in accordance with the
requirements set forth in Section 10(d) of the December 2000 Registration Rights
Agreement and (ii) Section 7 of that certain Series C Preferred Stock Purchase
Agreement, dated as of May 17, 1996 (together, the "PRIOR AGREEMENTS").

         NOW, THEREFORE, in consideration of the promises and covenants
contained in this Agreement and intending to be legally bound by the terms and
conditions of this Agreement, the parties hereto agree as follows:

         1.       DEMAND REGISTRATIONS.

                  (a)      REQUESTS FOR REGISTRATION. Subject to the provisions
of Sections 1(b) and 1(c) below, (i) at any time and from time to time after the
earlier of (a) the expiration of a holdback period (as provided for in Section 3
of this Agreement), if any, and (b) December 20, 2005 (the "SERIES B
STOCKHOLDER DEMAND PERIOD"), the holders of a majority of the then outstanding
Registrable Securities held by the Series B Stockholders may request
registration, (ii) at any time and from time to time after the earlier of (a)
the expiration of a holdback period (as provided for in Section 3 of this
Agreement), if any, and (b) December 20, 2005 (the "SERIES C STOCKHOLDER
DEMAND PERIOD"), the holders of a majority of the then outstanding Registrable
Securities held by the Series C Stockholders may request registration, whether
underwritten or otherwise, under the Securities Act of all or part of the
Registrable Securities held by (I) such Series B Stockholders, or (II) such
Series C Stockholders, as the case may be, in each case on Form S-1 or any
similar long-form registration statement (collectively, "LONG-FORM
REGISTRATIONS") or on Form S-2 or S-3 or any similar short-form registration
statement ("SHORT-FORM REGISTRATIONS"), if available. All registrations
requested pursuant to this Section 1(a) are referred to herein as "DEMAND
REGISTRATIONS". Each request for a Demand Registration shall specify the
approximate number of Registrable Securities requested to be registered and the
anticipated per share price range for such offering. Within ten days after
receipt of any such request for a Long-Form Registration or Short-Form
Registration, the Company shall give written notice of such requested
registration to all other holders of Registrable Securities and shall include
(subject to the provisions of this Agreement) in such registration all
Registrable Securities with respect to which the Company has received written
requests for inclusion therein within 15 days after the receipt of the Company's
notice.

                  (b)      NUMBER OF DEMAND REGISTRATIONS.

                           (i)      The holders of a majority of the then
outstanding Registrable Securities held by the Series B Stockholders shall be
entitled to request one (1) Demand Registration with respect to Registrable
Securities held by such Series B Stockholders, in which the Company will pay all
Registration Expenses as set forth in Section 5 hereof; provided, that the
aggregate value of the securities to be offered pursuant to the Demand
Registration must be at least $10,000,000. A registration shall not count as the
permitted Demand Registration until it has become effective and unless the
requesting Series B Stockholders are able to register and sell all of the
Registrable Securities that such Series B Stockholders have requested to be
included in such registration.

                                       2.
<PAGE>

                           (ii)     The holders of a majority of the then
outstanding Registrable Securities held by the Series C Stockholders shall be
entitled to request two (2) Demand Registrations with respect to Registrable
Securities held by such Series C Stockholders, in which the Company will pay all
Registration Expenses as set forth in Section 5 hereof; provided, that the
aggregate value of the securities to be offered pursuant to the Demand
Registration must be at least $10,000,000. A registration shall not count as one
of the permitted Demand Registrations unless it has become effective and unless
the requesting Series C Stockholders are able to register and sell all of the
Registrable Securities that such Series C Stockholders have requested to be
included in such registration.

                  (c)      SHORT-FORM REGISTRATIONS.

                           (i)      Demand Registrations shall be Short-Form
Registrations whenever the Company is permitted to use any applicable short
form. After the Company has become subject to the reporting requirements of the
Exchange Act, the Company shall use its best efforts to make Short-Form
Registrations available for the sale of Registrable Securities.

                           (ii)     The holders of (a) a majority of the then
outstanding Registrable Securities held by the Series A-1 Stockholders, (b) a
majority of the then outstanding Registrable Securities held by the Series A-2
Stockholders, (c) a majority of the then outstanding Registrable Securities held
by the Series A-3 Stockholders, (d) a majority of the then outstanding
Registrable Securities held by the Series A-4 Stockholder, and (e) a majority of
the then outstanding Registrable Securities held by the Series A-5 Stockholders,
shall each be entitled to request two Short-Form Registrations with respect to
the Registrable Securities held by them in which the Company shall pay all
Registration Expenses; provided, that (x) the aggregate value of the securities
to be offered pursuant to such Short-Form Registration must be at least
$1,000,000 and (y) the Company qualifies to use a Form S-2 or S-3 or any similar
short-form registration statement.

                           (iii)    The holders of a majority of the then
outstanding Registrable Securities held by the Series A Stockholders shall be
entitled to request an unlimited number of Short-Form Registrations with respect
to the Registrable Securities held by them in which the Company shall pay all
Registration Expenses; provided, that (a) the aggregate value of the securities
to be offered pursuant to such Short-Form Registration must be at least
$1,000,000 and (b) the Company qualifies to use a Form S-2 or S-3 or any similar
short-form registration statement.

                           (iv)     In addition to the Demand Registration
provided pursuant to Section 1(b), the holders of a majority of the then
outstanding Registrable Securities held by the Series B Stockholders shall be
entitled to request an unlimited number of Short-Form Registrations with respect
to the Registrable Securities held by them in which the Company shall pay all
Registration Expenses; provided, that (a) the aggregate value of the securities
to be offered pursuant to such Short-Form Registration must be at least $500,000
and (b) the Company qualifies to use a Form S-2 or S-3 or any similar short-form
registration statement.

                           (v)      In addition to the Demand Registrations
provided pursuant to Section 1(b), the holders of a majority of the then
outstanding Registrable Securities held by the

                                       3.
<PAGE>

Series C Stockholders shall be entitled to request an unlimited number of
Short-Form Registrations with respect to the Registrable Securities held by them
in which the Company shall pay all Registration Expenses; provided, that (a) the
aggregate value of the securities to be offered pursuant to such Short-Form
Registration must be at least $500,000 and (b) the Company qualifies to use a
Form S-2 or S-3 or any similar short-form registration statement.

                  (d)      PRIORITY ON DEMAND REGISTRATIONS.

                           (i)      The Company shall not include in any Demand
Registration requested by a majority in interest of the then outstanding
Registrable Securities held by the Series B Stockholders during the Series B
Stockholder Demand Period (a "SERIES B DEMAND REGISTRATION") any securities that
are not Registrable Securities held by the Series B Stockholders without the
prior written consent of a majority in interest of the then outstanding
Registrable Securities held by the Series B Stockholders. If such a Demand
Registration is an underwritten offering and the managing underwriters advise
the Company in writing that in their opinion the number of Registrable
Securities and, if permitted hereunder by the Series B Stockholders, other
securities requested to be included in such offering exceeds the number of
Registrable Securities and other securities, if any, which can be sold in an
orderly manner in such offering within a price range acceptable to a majority in
interest of the then-outstanding Registrable Securities held by the Series B
Stockholders, then, the number of shares to be included in such registration,
which in the opinion of such underwriters can be sold in an orderly manner
within the price range of such offering, shall be allocated first, pro rata
among the Series B Stockholders on the basis of the amount of Registrable
Securities owned by each such holder, second, pro rata among the Series C
Stockholders on the basis of the amount of Registrable Securities owned by each
such holder, third, pro rata among the Series A Stockholders and the Asklipios
Stockholders on the basis of the amount of Registrable Securities owned by each
such holder and fourth, pro rata among any stockholder of the Company (other
than a Stockholder) on the basis of the number of shares of Company capital
stock owned by such stockholder on an as-converted-to-Common Stock basis.

                           (ii)     The Company shall not include in any Demand
Registration requested by a majority in interest of the then outstanding
Registrable Securities held by the Series C Stockholders during the Series C
Stockholder Demand Period (a "SERIES C DEMAND REGISTRATION") any securities that
are not Registrable Securities held by the Series C Stockholders without the
prior written consent of a majority in interest of the then outstanding
Registrable Securities held by the Series C Stockholders. If such a Demand
Registration is an underwritten offering and the managing underwriters advise
the Company in writing that in their opinion the number of Registrable
Securities and, if permitted hereunder by the Series C Stockholders, other
securities requested to be included in such offering exceeds the number of
Registrable Securities and other securities, if any, which can be sold in an
orderly manner in such offering within a price range acceptable to a majority in
interest of the then outstanding Registrable Securities held by the Series C
Stockholders, then, the number of shares to be included in such registration,
which in the opinion of such underwriters can be sold in an orderly manner
within the price range of such offering, shall be allocated first, pro rata
among the Series C Stockholders on the basis of the amount of Registrable
Securities owned by each such holder, second, pro rata among the Series B
Stockholders on the basis of the amount of Registrable Securities owned by each
such holder, third, pro rata among the Series A Stockholders and the

                                       4.
<PAGE>

Asklipios Stockholders on the basis of the amount of Registrable Securities
owned by each such holder and fourth, pro rata among any stockholder of the
Company (other than a Stockholder) on the basis of the number of shares of
Company capital stock owned by such stockholder on an as-converted-to-Common
Stock basis.

                           (iii)    Any Persons other than holders of
Registrable Securities who participate in Demand Registrations that are not at
the Company's expense must pay their share of the Registration Expenses as
provided in Section 5 hereof.

                  (e)      RESTRICTIONS ON DEMAND REGISTRATIONS. The Company
shall not be obligated to effect any Demand Registration (i) within 90 days
after the effective date of a Listing occurring after the First Listing, unless
(A) the Series B Stockholders or the Series C Stockholders, as the case may be,
requesting the Demand Registration hold more than 10% of the then outstanding
Registrable Securities, or (B) any Stockholders other than the Series B
Stockholders or the Series C Stockholders exercise any demand registration
rights granted by the Company to such holders, whereupon the Company shall
include in such registration the number of Registrable Securities requested to
be included (which in the opinion of the underwriters can be sold in an orderly
manner within the price range of such offering, if such offering is an
underwritten offering) pro rata between the Stockholders exercising such demand
registration rights on the basis of the amount of Registrable Securities owned
by each such holder, or (ii) if, at the time the Series B Stockholders or the
Series C Stockholders request such Demand Registration, (A) the Company has
during the prior 60 day period previously notified such Stockholder(s) in
writing that the Company has determined to register any of its securities on its
own behalf within the next 90 day period, (B) such Stockholder(s) have not
responded in writing to the Company within fourteen (14) days after receiving
such notice stating that such Stockholder(s) are requesting a Demand
Registration pursuant to the terms and conditions of this Agreement, and (C) the
Company has not abandoned its efforts to register its securities. In addition,
if, within 10 days after the Company's receipt of a request for a Series B
Demand Registration, the Company receives a request for a Series C Demand
Registration from the holders of a majority of the then outstanding Registrable
Securities held by the Series C Stockholders, the Company shall not effect such
Series B Demand Registration until the earlier to occur of (i) the date that is
ninety (90) days after the effective date of the Series C Demand Registration,
(ii) the abandonment of such Series C Demand Registration or (iii) the date that
is one hundred eighty (180) days after the date on which the request for a
Series C Demand Registration is received by the Company; provided, however, that
the foregoing limitations shall not apply to more than one (1) Series B Demand
Registration. The Company may postpone for up to 60 days the filing or the
effectiveness of a registration statement for a Demand Registration if the
Company's board of directors determines in its reasonable good faith judgment
that such Demand Registration would reasonably be expected to interfere with any
proposal or plan by the Company or any of its subsidiaries to engage in any
acquisition of assets (other than in the ordinary course of business) or any
merger, consolidation, tender offer, reorganization or other material
transaction; provided, that in such event, the holders of Registrable Securities
initially requesting such Demand Registration shall be entitled to withdraw such
request and, if such request is withdrawn, such Demand Registration shall not
count as one of the permitted Demand Registrations hereunder and the Company
shall pay all Registration Expenses in connection with such registration. The
Company may delay a Demand Registration hereunder only once in any twelve-month
period.

                                       5.
<PAGE>

                  (f)      SELECTION OF UNDERWRITERS. The holders of a majority
of the Registrable Securities initially requesting registration under Section 1
shall have the right to select the investment banker(s) and manager(s) to
administer the offering, provided that investment banker(s) and manager(s) are
nationally recognized; and provided, further that such investment banker(s) and
manager(s) are approved by the Company, which approval shall not be unreasonably
withheld.

                  (g)      OTHER REGISTRATION RIGHTS. Except as provided in this
Agreement, the Company shall not grant to any Persons the right to request that
the Company register any equity securities of the Company, or any securities
convertible or exchangeable into or exercisable for such securities, without the
prior written consent of a majority in interest of the Series B Preferred Stock
and a majority in interest of the Series C Preferred Stock, unless such rights
granted to such Persons are subordinate to the rights granted to the Series B
Stockholders and Series C Stockholders.

         2.       PIGGYBACK REGISTRATIONS.

                  (a)      RIGHT TO PIGGYBACK. Whenever the Company proposes to
register any of its securities under the Securities Act (including a Short-Form
Registration pursuant to Section 1(c) above but excluding (i) a Demand
Registration, (ii) any registration on Form S-8 or S-4 or any similar form, or
(iii) a registration the primary purpose of which is to register debt securities
(i.e., in connection with a so-called "EQUITY KICKER")) and the registration
form to be used may be used for the registration of Registrable Securities (a
"PIGGYBACK REGISTRATION"), the Company shall give prompt written notice (and in
any event within three business days after its receipt of notice of any exercise
of demand registration rights other than under this Agreement) to all holders of
Registrable Securities of its intention to effect such a registration and shall
include in such registration all Registrable Securities with respect to which
the Company has received written requests for inclusion therein within 20 days
after the receipt of the Company's notice.

                  (b)      PIGGYBACK EXPENSES. The Registration Expenses of the
holders of Registrable Securities shall be paid by the Company in all Piggyback
Registrations.

                  (c)      PRIORITY ON PRIMARY REGISTRATIONS. Subject to the
provisions of Section 2(a) above, if a Piggyback Registration is an underwritten
primary registration on behalf of the Company, the Company will include in such
registration all Registrable Securities requested to be included in such
registration; provided, that if the managing underwriters advise the Company in
writing that in their opinion the number of securities requested to be included
in such registration exceeds the number that can be sold in such offering
without adversely affecting the marketability of the offering, the Company shall
include in such registration (i) first, the securities the Company proposes to
sell, (ii) second, the Registrable Securities requested to be included by the
Series C Stockholders, allocated pro rata among the holders of such Registrable
Securities on the basis of the number of shares owned by each such holder, (iii)
third, the Registrable Securities requested to be included in such registration
by all other holders of Registrable Securities, allocated pro rata among the
holders of such Registrable Securities on the basis of the number of shares
owned by each such holder, and (iv) fourth, other securities requested to be
included in such registration.

                                       6.
<PAGE>

                  (d)      PRIORITY ON SECONDARY REGISTRATIONS. If a Piggyback
Registration is an underwritten secondary registration on behalf of holders of
the Company's securities (which registration is made pursuant to Section 1(b)
above or, if applicable, is consented to pursuant to Section 1(g) above), and
the managing underwriters advise the Company in writing that in their opinion
the number of securities requested to be included in such registration exceeds
the number that can be sold in such offering without adversely affecting the
marketability of the offering, the Company shall include in such registration
(i) first, the securities requested to be included therein by the holders
requesting such registration, (ii) second, the Registrable Securities requested
to be included by the Series C Stockholders, allocated pro rata among the
holders of such Registrable Securities on the basis of the number of shares
owned by each such holder, (iii) third, the Registrable Securities requested to
be included in such registration by all other holders of Registrable Securities,
allocated pro rata among the holders of such Registrable Securities on the basis
of the number of shares owned by each such holder, and (iv) fourth, other
securities requested to be included in such registration.

                  (e)      SELECTION OF UNDERWRITERS. If any Piggyback
Registration is an underwritten offering, the selection of investment banker(s)
and manager(s) for the offering must be approved by (i) the Company and (ii) the
holders of a majority of the Registrable Securities included in such Piggyback
Registration, which approvals shall not be unreasonably withheld.

         3.       HOLDBACK AGREEMENTS. Each holder of Registrable Securities
shall not effect any public sale or distribution (including sales pursuant to
Rule 144) of (i) equity securities of the Company, or any securities convertible
into or exchangeable or exercisable for such securities, during the seven days
prior to and the 180-day period beginning on the effective date of the First
Listing (except for sales of securities as part of such First Listing) or (ii)
Registrable Securities during the seven days prior to and the 90 day period
beginning on the effective date of any Listing by the Company on its own behalf
(other than the First Listing), unless the underwriters managing the registered
public offering otherwise agree.

         4.       REGISTRATION PROCEDURES. Whenever the holders of Registrable
Securities have requested that any Registrable Securities be registered pursuant
to this Agreement, the Company shall use its best efforts to effect the
registration and the sale of such Registrable Securities in accordance with the
intended method of disposition thereof, and pursuant thereto the Company shall
as expeditiously as possible:

                  (a)      prepare and file with the Securities and Exchange
Commission a registration statement with respect to such Registrable Securities
and use its best efforts to cause such registration statement to become
effective (provided that before filing a registration statement or prospectus or
any amendments or supplements thereto, the Company shall furnish to the counsel
selected by the holders of a majority of the Registrable Securities covered by
such registration statement copies of all such documents proposed to be filed,
which documents shall be subject to the review and comment of such counsel);

                  (b)      notify each holder of Registrable Securities of the
effectiveness of each registration statement filed hereunder and prepare and
file with the Securities and Exchange Commission such amendments and supplements
to such registration statement and the prospectus used in connection therewith
as may be necessary to keep such registration statement

                                       7.
<PAGE>

effective for a period of not less than 180 days and comply with the provisions
of the Securities Act with respect to the disposition of all securities covered
by such registration statement during such period in accordance with the
intended methods of disposition by the sellers thereof set forth in such
registration statement;

                  (c)      furnish to each seller of Registrable Securities such
number of copies of such registration statement, each amendment and supplement
thereto, the prospectus included in such registration statement (including each
preliminary prospectus) and such other documents as such seller may reasonably
request in order to facilitate the disposition of the Registrable Securities
owned by such seller;

                  (d)      use its best efforts to register or qualify such
Registrable Securities under such other securities or "blue sky" laws of such
jurisdictions as any seller reasonably requests and do any and all other acts
and things which may be reasonably necessary or advisable to enable such seller
to consummate the disposition in such jurisdictions of the Registrable
Securities owned by such seller (provided that the Company shall not be required
to (i) qualify generally to do business in any jurisdiction where it would not
otherwise be required to qualify but for this subparagraph, (ii) subject itself
to taxation in any such jurisdiction or (iii) consent to general service of
process in any such jurisdiction);

                  (e)      notify each seller of such Registrable Securities on
a timely basis, at any time when a prospectus relating thereto is required to be
delivered under the Securities Act, of the happening of any event as a result of
which the prospectus included in such registration statement (read in
conjunction with any documents incorporated by reference therein) contains an
untrue statement of a material fact or omits any fact necessary to make the
statements therein not misleading (following which the Company shall promptly
prepare a supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of such Registrable Securities, such prospectus
shall not contain an untrue statement of a material fact or omit to state any
fact necessary to make the statements therein not misleading, with the time
required to prepare such supplement or amendment being added to the 180-day
period set forth in Section 4(b) above);

                  (f)      cause all such Registrable Securities to be listed on
each securities exchange on which similar securities issued by the Company are
then listed and, if not so listed, to be quoted on the National Association of
Securities Dealers, Inc. (the "NASD") automated quotation system and, if quoted
on the NASD automated quotation system, use its best efforts to secure
designation of all such Registrable Securities covered by such registration
statement as a NASDAQ "national market system security" within the meaning of
Rule 11Aa2-1 of the Securities and Exchange Commission or, failing that, to
secure NASDAQ authorization for such Registrable Securities and, without
limiting the generality of the foregoing, to arrange for at least two market
makers to register as such with respect to such Registrable Securities with the
NASD;

                  (g)      provide a transfer agent and registrar for all such
Registrable Securities no later than the effective date of such registration
statement;

                                       8.
<PAGE>

                  (h)      enter into such customary agreements (including
underwriting agreements in customary form) and take all such other actions as
the holders of a majority of the Registrable Securities being sold or the
underwriters, if any, reasonably request in order to expedite or facilitate the
disposition of such Registrable Securities (including effecting a stock split or
a combination of shares);

                  (i)      make available for inspection by any seller of
Registrable Securities, any underwriter participating in any disposition
pursuant to such registration statement and any attorney, accountant or other
agent retained by any such seller or underwriter, all financial and other
records, pertinent corporate documents and properties of the Company, and cause
the Company's officers, directors, employees and independent accountants to
supply all information reasonably requested by any such seller, underwriter,
attorney, accountant or agent in connection with such registration statement;

                  (j)      otherwise use its best efforts to comply with all
applicable rules and regulations of the Securities and Exchange Commission, and
make available to its security holders, as soon as reasonably practicable, an
earnings statement covering the period of at least twelve months beginning with
the first day of the Company's first full calendar quarter after the effective
date of the registration statement, which earnings statement shall satisfy the
provisions of Section 11(a) of the Securities Act and Rule 158 thereunder;

                  (k)      permit any holder of Registrable Securities which
holder, in its sole and exclusive judgment, might be deemed to be an underwriter
or a controlling person of the Company, to participate in the preparation of
such registration or comparable statement and to require the insertion therein
of material, furnished to the Company in writing, which in the reasonable
judgment of such holder and its counsel should be included;

                  (l)      in the event of the issuance of any stop order
suspending the effectiveness of a registration statement, or of any order
suspending or preventing the use of any related prospectus or suspending the
qualification of any security included in such registration statement for sale
in any jurisdiction, the Company shall use its best efforts promptly to obtain
the withdrawal of such order (provided that the time required to obtain such
withdrawal shall be added to the 180-day period set forth in Section 4(b)
above);

                  (m)      use its best efforts to cause such Registrable
Securities covered by such registration statement to be registered with or
approved by such other governmental agencies or authorities as may be necessary
to enable the sellers thereof to consummate the disposition of such Registrable
Securities; and

                  (n)      obtain a cold comfort letter from the Company's
independent public accountants in customary form and covering such matters of
the type customarily covered by cold comfort letters as the holders of a
majority of the Registrable Securities being sold reasonably request (provided
that such Registrable Securities constitute at least 10% of the securities
covered by such registration statement).

                                       9.
<PAGE>

         5.       REGISTRATION EXPENSES.

                  (a)      All expenses incident to the Company's performance of
or compliance with this Agreement, including without limitation all registration
and filing fees, fees and expenses of compliance with securities or "blue sky"
laws, printing expenses, messenger and delivery expenses, fees and disbursements
of custodians, fees and disbursements of counsel for the Company, fees and
disbursements, not to exceed $25,000 in the aggregate in connection with any one
or a series of related registration statements, of one counsel selected by a
majority in interest of the sellers of Registrable Securities, and all
independent certified public accountants and other Persons retained by the
Company (all such expenses being herein called "REGISTRATION EXPENSES"), shall
be borne as provided in this Agreement, except that the Company shall, in any
event, pay its internal expenses (including, without limitation, all salaries
and expenses of its officers and employees performing legal or accounting
duties), the expense of any annual audit or quarterly review, the expense of any
liability insurance and the expenses and fees for listing the securities to be
registered on each securities exchange on which similar securities issued by the
Company are then listed or on the NASD automated quotation system.

                  (b)      The holders of Registrable Securities included in
each Demand Registration and each Piggyback Registration shall pay all
underwriting discounts and selling commissions applicable to the sale of their
securities and all fees and disbursements of their counsel.

                  (c)      To the extent Registration Expenses are not required
to be paid by the Company, each holder of securities included in any
registration hereunder shall pay those Registration Expenses allocable to the
registration of such holder's securities so included, and any Registration
Expenses not so allocable shall be borne by all sellers of securities included
in such registration in proportion to the aggregate selling price of the
securities to be so registered.

         6.       INDEMNIFICATION.

                  (a)      The Company agrees to indemnify and hold harmless, to
the extent permitted by law, each holder of Registrable Securities, its officers
and directors or general and limited partners, members, managers and each Person
who controls such holder (within the meaning of the Securities Act) against all
losses, claims, damages, liabilities, joint or several, and expenses (as such
are incurred) caused by any untrue or alleged untrue statement of material fact
contained in any registration statement, prospectus, preliminary prospectus,
offering circular or other document incident to such registration or any
amendment thereof or supplement thereto, any "blue sky" application or other
document executed by the Company specifically for that purpose or any omission
or alleged omission of a material fact required to be stated therein or
necessary to make the statements therein not misleading or any violation by the
Company or its agents of the Securities Act or any rule or regulation
promulgated thereunder applicable to the Company or its agents and relating to
action or inaction required of the Company in connection with such regulation,
except insofar as the same are (i) incurred as a result of the use or delivery
of a prospectus by such holder subsequent to the holder's receipt of
notification pursuant to Section 4(e) and prior to the delivery to such holder
of the supplement or amendment referenced in said Section 4(e) or (ii) caused by
or contained in any information furnished in writing to the Company by such
holder expressly for use therein or by such holder's failure to deliver a copy
of

                                      10.
<PAGE>

the registration statement or prospectus or any amendments or supplements
thereto after the Company has furnished such holder with a sufficient number of
copies of the same. In connection with an underwritten offering, the Company
shall indemnify such underwriters, their officers and directors and each Person
who controls such underwriters (within the meaning of the Securities Act) to the
same extent as provided above with respect to the indemnification of the holders
of Registrable Securities.

                  (b)      In connection with any registration statement in
which a holder of Registrable Securities is participating, each such holder
shall furnish to the Company in writing such information and affidavits as the
Company reasonably requests and expressly states are for use in connection with
any such registration statement or prospectus and, to the extent permitted by
law, shall indemnify the Company, its directors and officers and each Person who
controls the Company (within the meaning of the Securities Act) against any
losses, claims, damages, liabilities and expenses (as such are incurred)
resulting from any untrue or alleged untrue statement of material fact contained
in the registration statement, prospectus or preliminary prospectus or any
amendment thereof or supplement thereto or any omission or alleged omission of a
material fact required to be stated therein or necessary to make the statements
therein not misleading, but only to the extent that such untrue statement or
omission is contained in any information or affidavit so furnished in writing by
such holder; provided that the obligation to indemnify shall be individual, not
joint and several, for each holder and shall be limited to the net amount of
proceeds received by such holder from the sale of Registrable Securities
pursuant to such registration statement.

                  (c)      Any Person entitled to indemnification hereunder
shall (i) give prompt written notice to the indemnifying party of any claim with
respect to which it seeks indemnification (provided that the failure to give
prompt notice shall not impair any Person's right to indemnification hereunder
to the extent such failure has not materially prejudiced the indemnifying party)
and (ii) unless in such indemnified party's reasonable judgment a conflict of
interest between such indemnified and indemnifying parties may exist with
respect to such claim, permit such indemnifying party to assume the defense of
such claim with counsel reasonably satisfactory to the indemnified party. If
such defense is assumed, the indemnifying party shall not be subject to any
liability for any settlement made by the indemnified party without its consent
(but such consent shall not be unreasonably withheld). An indemnifying party who
is not entitled to, or elects not to, assume the defense of a claim shall not be
obligated to pay the fees and expenses of more than one counsel for all parties
indemnified by such indemnifying party with respect to such claim, unless in the
reasonable judgment of any indemnified party a conflict of interest may exist
between such indemnified party and any other of such indemnified parties with
respect to such claim.

                  (d)      The indemnification provided for under this Agreement
shall remain in full force and effect regardless of any investigation made by or
on behalf of the indemnified party or any officer, director, general partner,
limited partner, member, manager or controlling Person of such indemnified party
and shall survive the transfer of securities.

                  (e)      CONTRIBUTION. If the indemnification provided for in
this Section 6 shall for any reason be held by a court to be unavailable to an
indemnified party under paragraphs (a) or (b) hereof in respect of any loss,
claim, damage or liability, or any action in respect thereof,

                                      11.
<PAGE>

then, in lieu of the amount paid or payable under paragraph (a) or (b) hereof,
the indemnified party and the indemnifying party under paragraph (a) or (b)
hereof shall contribute to the aggregate losses, claims, damages and liabilities
(including legal or other expenses reasonably incurred in connection with
investigating the same), (i) in such proportion as is appropriate to reflect the
relative fault of the Company and the prospective sellers of Registrable
Securities covered by such registration statement that resulted in such loss,
claim, damage or liability, or action in respect thereof, with respect to the
statements or omissions which resulted in such loss, claim, damage, liability,
or action in respect thereof, as well as any other relevant equitable
consideration, or (ii) if the allocation provided by such clause (i) above is
not permitted by applicable law, in such proportion as shall be appropriate to
reflect the relative benefits received by the Company and such prospective
sellers from the offering of such securities covered by such registration
statement. No Person guilty of fraudulent misrepresentation (within the meaning
of Section 11(f) of the Securities Act) shall be entitled to contribution from
any Person who was not guilty of such fraudulent misrepresentation; provided,
however, that the contribution of any seller under this Section 6(e) shall be
limited to the amount of net proceeds received by such seller from the offering
giving rise to such contribution. Such prospective Sellers' obligations to
contribute as provided in this paragraph (e) are several in proportion to the
relative value of their respective Registrable Securities covered by such
registration statement, and not joint. In addition, no Person shall be obligated
to contribute hereunder any amounts in payment for any settlement of any action
or claim effected without such Person's consent, which consent shall not be
unreasonably withheld.

         7.       RULE 144. With a view to making available the benefits of
certain rules and regulations of the Commission which may at any time permit the
sale of the Registrable Securities to the public without registration, except as
provided in paragraph (c) below, at all times after ninety (90) days after any
registration statement covering a public offering of securities of the Company
under the Securities Act shall have become effective, the Company agrees to:

                  (a)      Make and keep public information available, as those
terms are understood and defined in Rule 144 under the Securities Act (or any
successor rule);

                  (b)      Use its best efforts to file with the Commission in a
timely manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act; and

                  (c)      Furnish to each holder of Registrable Securities
forthwith upon request a written statement by the Company as to its compliance
with the reporting requirements of such Rule 144 (or any successor rule) and, at
any time after it has become subject to such reporting requirements, of the
Securities Act and the Exchange Act, a copy of the most recent annual or
quarterly report of the Company, and such other reports and documents so filed
by the Company as such holder may reasonably request in availing itself of any
rule or regulation of the Commission allowing such holder to sell any
Registrable Securities without registration.

         8.       PARTICIPATION IN UNDERWRITTEN REGISTRATIONS. No Person may
participate in any registration hereunder which is underwritten unless such
Person (i) agrees to sell such Person's securities on the basis provided in any
underwriting arrangements approved by the Person or

                                      12.
<PAGE>

Persons entitled hereunder to approve such arrangements and (ii) completes and
executes all questionnaires, powers of attorney, indemnities, underwriting
agreements and other documents required under the terms of such underwriting
arrangements; provided, that, no holder of Registrable Securities included in
any underwritten registration shall be required to make any representations or
warranties to the Company or the underwriters (other than representations and
warranties regarding such holder and such holder's intended method of
distribution) or to undertake any indemnification obligations to the Company or
the underwriters with respect thereto, except as otherwise provided in Section 6
hereof.

         9.       DEFINITIONS.

         "COMMISSION" means the Securities and Exchange Commission, or any other
federal agency at the time administering the Securities Act.

         "EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended.

         "FIRST LISTING" means the effective date of the first Listing.

         "LISTING" means the admission of the Company's common stock, par value
$.01 per share (the "COMMON STOCK"), on any national stock exchange or the sale
of the Common Stock in an underwritten public offering registered under the
Securities Act.

         "PREFERRED STOCKHOLDERS" means the Series A Stockholders, Series B
Stockholders and Series C Stockholders.

         "PERSON" means an individual, a partnership, a corporation, a limited
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization or a governmental entity or any
department, agency or political subdivision thereof.

         "REGISTRABLE SECURITIES" means (i) any shares of Common Stock issued or
issuable to the Preferred Stockholders upon conversion of the Series A Preferred
Stock, Series B Preferred Stock or Series C Preferred Stock, or otherwise
acquired by, or issued or issuable to, the Preferred Stockholders on or after
the date hereof, it being understood that none of the Preferred Stockholders
shall be obligated to convert their shares into shares of Common Stock in order
to make a Demand Registration or otherwise avail themselves of the rights
granted pursuant to this Agreement, (ii) any shares of Common Stock issued to
the Asklipios Stockholders, (iii) any capital stock of the Company acquired by
the Preferred Stockholders or the Asklipios Stockholders on or after the date
hereof, and (iv) any shares of capital stock of the Company issued or issuable
with respect to the securities referred to in clauses (i), (ii) or (iii) above
by way of a stock dividend or stock split or in connection with a combination of
shares, recapitalization, merger, consolidation, or other reorganization. As to
any particular Registrable Securities, such securities shall cease to be
Registrable Securities when they have been distributed to the public pursuant to
an offering registered under the Securities Act or sold to the public through a
broker, dealer or market maker in compliance with Rule 144 under the Securities
Act (or any similar rule then in force). For purposes of this Agreement, a
Person shall be deemed to be a holder of Registrable Securities, and the
Registrable Securities shall be deemed to be in existence, whenever such Person
has the right to acquire directly or indirectly such Registrable Securities
(upon conversion or exercise in connection with a transfer of securities or
otherwise, but

                                      13.
<PAGE>

disregarding any restrictions or limitations upon the exercise of such right),
whether or not such acquisition has actually been effected, and such Person
shall be entitled to exercise the rights of a holder of Registrable Securities
hereunder.

         "SECURITIES ACT" means the Securities Act of 1933, as amended.

         Unless otherwise stated, other capitalized terms contained herein have
the meanings set forth in the Purchase Agreement.

         10.      MISCELLANEOUS.

                  (a)      NO INCONSISTENT AGREEMENTS. The Company shall not
hereafter enter into any agreement with respect to its securities which is
adverse or superior to the rights granted to the Series A-4 Stockholders, the
Series A-5 Stockholders, the Series B Stockholders and the Series C Stockholders
pursuant to the terms and conditions of this Agreement.

                  (b)      ADJUSTMENTS AFFECTING REGISTRABLE SECURITIES. The
Company shall not take any action, or permit any change to occur, with respect
to its securities which would adversely affect the ability of the holders of
Registrable Securities to include such Registrable Securities in a registration
undertaken pursuant to this Agreement or which would adversely affect the
marketability of such Registrable Securities in any such registration
(including, without limitation, effecting a stock split or a combination of
shares).

                  (c)      REMEDIES. Any Person having rights under any
provision of this Agreement shall be entitled to enforce such rights
specifically to recover damages caused by reason of any breach of any provision
of this Agreement and to exercise all other rights granted by law. The parties
hereto agree and acknowledge that money damages may not be an adequate remedy
for any breach of the provisions of this Agreement and that any party may in its
sole discretion apply to any court of law or equity of competent jurisdiction
(without posting any bond or other security) for specific performance and for
other injunctive relief in order to enforce or prevent violation of the
provisions of this Agreement.

                  (d)      AMENDMENTS AND WAIVERS. Except as otherwise provided
herein, the provisions of this Agreement may be amended or waived only upon the
prior written consent of (i) the Company, (ii) Stockholders who hold at least
75% of the Registrable Securities underlying the Company's Series B Preferred
Stock, (iii) Stockholders who hold at least 75% of the Registrable Securities
underlying the Company's Series C Preferred Stock, (iv) Stockholders who hold at
least a majority of the Registrable Securities underlying the Company's Series
A-1 Preferred Stock, (v) Stockholders who hold at least a majority of the
Registrable Securities underlying the Company's Series A-2 Preferred Stock, (vi)
Stockholders who hold at least a majority of the Registrable Securities
underlying the Company's Series A-3 Preferred Stock, (vii) Stockholders who hold
at least a majority of the Registrable Securities underlying the Company's
Series A-4 Preferred Stock, (viii) Stockholders who hold at least a majority of
the Registrable Securities underlying the Company's Series A-5 Preferred Stock,
and (ix) the Series A Stockholders and the Asklipios Stockholders who hold at
least 50% of the Registrable Securities held by all such Series A Stockholders
and Asklipios Stockholders, taken as a group.

                                      14.
<PAGE>

                  (e)      SECOND CLOSING BUYERS. Notwithstanding anything to
the contrary contained herein, if the Company shall issue additional shares of
its Series C Preferred Stock pursuant to the Purchase Agreement (as such may be
amended from time to time in accordance with the provisions thereof), any
purchaser of such shares of Series C Preferred Stock may become a party to this
Agreement by executing and delivering an additional counterpart signature page
to this Agreement and shall be deemed a "Series C Stockholder" hereunder.

                  (f)      ENTIRE AGREEMENT. Except as otherwise expressly set
forth herein, this Agreement embodies the complete agreement and understanding
among the parties hereto with respect to the subject matter hereof and
supersedes and preempts any prior understandings, agreements or representations
by or among the parties, written or oral, which may have related to the subject
matter hereof in any way. Without limiting the generality of the foregoing, the
Prior Agreements are hereby amended in their entirety and restated herein. Such
amendments and restatements shall be effective upon the execution of this
Agreement by (i) the Company, (ii) the Series A-4 Stockholder, (iii) Series A-5
Stockholders who hold at least 66% of the Registrable Securities held by all
Series A-5 Stockholders, (iv) Series B Stockholders who hold at least 75% of the
Registrable Securities held by all Series B Stockholders and (v) Series A-1
Stockholders, Series A-2 Stockholders, Series A-3 Stockholders and Asklipios
Stockholders who hold at least 50% of the Registrable Securities held by all
such Series A-1 Stockholders, Series A-2 Stockholders, Series A-3 Stockholders
and Asklipios Stockholders, taken as a group. Upon such execution, all
provisions of, rights granted and covenants made in the Prior Agreements are
hereby waived, released and superseded in their entirety and shall have no
further force or effect.

                  (g)      SUCCESSORS AND ASSIGNS. All covenants and agreements
in this Agreement by or on behalf of any of the parties hereto shall bind and
inure to the benefit of the respective successors (including successors created
by amalgamation, merger, or otherwise) and assigns of the parties hereto whether
so expressed or not. In addition, whether or not any express assignment has been
made, the provisions of this Agreement which are for the benefit of purchasers
or holders of Registrable Securities are also for the benefit of, and
enforceable by, any subsequent holder of Registrable Securities. Notwithstanding
anything to the contrary contained herein, no holder of Registrable Securities
may transfer or assign any rights granted to such holder under the terms and
conditions of this Agreement unless such holder transfers or assigns at least
25% of the Registrable Securities held by such holder.

                  (h)      SEVERABILITY. Whenever possible, each provision of
this Agreement shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement is held to be
prohibited by or invalid under applicable law, such provision shall be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of this Agreement.

                  (i)      COUNTERPARTS. This Agreement may be executed
simultaneously in two or more counterparts, any one of which need not contain
the signatures of more than one party, but all such counter-parts taken together
shall constitute one and the same Agreement.

                  (j)      DESCRIPTIVE HEADINGS. The descriptive headings of
this Agreement are inserted for convenience only and do not constitute a part of
this Agreement.

                                      15.
<PAGE>

                  (k)      GOVERNING LAW. This Agreement and the rights and
obligations of the parties hereunder shall be construed in accordance with and
governed by the law of the State of New York without giving effect to the choice
of law or conflict of laws principles thereof.

                  (l)      NOTICES. All notices, demands or other communications
to be given or delivered under or by reason of the provisions of this Agreement
shall be in writing and shall be deemed to have been given when delivered
personally to the recipient, sent to the recipient by reputable overnight
courier service (charges prepaid) or mailed to the recipient by certified or
registered mail, return receipt requested and postage prepaid; provided,
however, that certified or registered mail shall not be used to effectuate
delivery of any such notices to addresses outside of the United States. Such
notices, demands and other communications shall be sent to the addresses
indicated below:

         IF TO THE COMPANY:

                  ANADYS PHARMACEUTICALS, INC.
                  9050 Camino Santa Fe
                  San Diego, CA  92121
                  Attention: President
                  Telecopy No.: (858) 527-1540

         WITH COPIES (WHICH SHALL NOT CONSTITUTE NOTICE TO THE COMPANY) TO:

                  COOLEY GODWARD LLP
                  4401 Eastgate Mall
                  San Diego, CA  92121-9109
                  Attention: Thomas A. Coll
                  Telecopy No.: (858) 550-6420

         IF TO THE SERIES A-1 STOCKHOLDERS, SERIES A-2 STOCKHOLDERS OR SERIES
         A-3 STOCKHOLDERS:

                  To their last known addresses contained in the books and
records of the Company.

                                      16.
<PAGE>

         WITH COPIES (WHICH SHALL NOT CONSTITUTE NOTICE TO SUCH STOCKHOLDERS)
         TO:

                  MCDERMOTT, WILL & EMERY
                  28 State Street
                  Boston, MA 02109-1775
                  Attention: Mark B. Stein
                  Telecopy No. (617) 535-3800

         IF TO THE SERIES A-4 STOCKHOLDER:

                  SHIRE PHARMACEUTICALS GROUP PLC
                  275 Armand-Frappier Boulevard
                  Laval, Quebec  H7V4A7
                  Canada
                  Attention: Vice President, Legal Affairs
                  Telecopy No. (514) 978-7755

         WITH COPIES (WHICH SHALL NOT CONSTITUTE NOTICE TO THE SERIES A-4
         STOCKHOLDER) TO:

                  KIRKLAND & ELLIS
                  153 East 53rd Street
                  New York,  NY  10022
                  Attention: Michael Kalish, Esq.
                  Telecopy No.: (212) 446-4900

         IF TO THE SERIES A-5 STOCKHOLDERS:

         All communications with copies shall be sent as specified in the
Purchase Agreement between the Company and the Series A-5 Stockholders dated as
of December 15, 1998.

         IF TO THE SERIES B STOCKHOLDERS:

                  SGC PARTNERS I, LLC
                  1221 Avenue of the Americas
                  New York, NY 10020
                  Attention: Justin Hall-Tipping, Managing Director
                  Telecopy No. (212) 278-5454

         WITH COPIES (WHICH SHALL NOT CONSTITUTE NOTICE TO THE SERIES B
         STOCKHOLDERS) TO:

                  MINTZ, LEVIN, COHN, FERRIS, GLOVSKY AND POPEO, P.C.
                  The Chrysler Center
                  666 Third Avenue
                  New York, NY  10017
                  Attention: Richard R. Kelly, Esq.
                  Telecopy No.: (212) 983-3115

                                      17.
<PAGE>

         IF TO THE SERIES C STOCKHOLDERS:

                  CARE CAPITAL, LLC
                  [ADDRESS]
                  [TELECOPY NO.]

         WITH COPIES (WHICH SHALL NOT CONSTITUTE NOTICE TO THE SERIES C
         STOCKHOLDERS) TO:

                  MORGAN LEWIS
                  502 Carnegie Center
                  Princeton, New Jersey 08540
                  Attention: Steven M. Cohen
                  Telecopy No.: (609) 919-6639

         IF TO ALL OTHER STOCKHOLDERS:

         All communications shall be sent to the address for each other
Stockholder listed at the offices of the Company, or to such other address or to
the attention of such other person as the recipient party has specified by prior
written notice to the sending party. All such communications shall be sent to
all parties to this Agreement other than the Series A-4 Stockholder, the Series
A-5 Stockholders, the Series B Stockholders and the Series C Stockholders to
their last known addresses contained in the books and records of the Company.

                  (m)      TERMINATION. The terms and conditions of this
Agreement shall terminate and be of no further force and effect upon the third
anniversary of the effective date of the First Listing.

                                      18.
<PAGE>


         IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.

                                       ANADYS PHARMACEUTICALS, INC.

                                       By:______________________________________
                                              Kleanthis G. Xanthopoulos, Ph.D.
                                           President and Chief Executive Officer

                     [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]

<PAGE>

CW VENTURES II, L.P.,                     ACCEL IV L.P.

By: CW Partners III, L.P.,                By: Accel IV Associates, L.P.,
    Its General Partner                       Its General Partner

By:___________________________________    By:___________________________________

Name:_________________________________    Name:_________________________________
             General Partner                            General Partner

ACCEL INVESTORS `93 L.P.                  ACCEL JAPAN L.P.

                                          By: Accel Japan Associates, L.P.,
By:___________________________________        Its General Partner

Name:_________________________________
             General Partner              By:___________________________________

                                          Name:_________________________________
                                                        General Partner

ACCEL KEIRETSU L.P.                       ELLMORE C. PATTERSON PARTNERS

By: Accel Partners & Co., Inc.,
    Its General Partner                   By:___________________________________

                                          Name:_________________________________
By:___________________________________                  General Partner

Name:_________________________________    ATLAS VENTURE FUND II, L.P.

Title:________________________________    By: Atlas Venture Associates II, L.P.,
                                              Its General Partner
PROSPER PARTNERS

                                          By:___________________________________
By:___________________________________
                                          Name:_________________________________
Name:_________________________________                  General Partner

Title:________________________________

                    [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]
<PAGE>

NEW ENTERPRISE ASSOCIATES 5               ROVENT II LIMITED PARTNERSHIP

                                          By: Advent International Limited
                                              Partnership, General Partner
By:___________________________________
                                          By: Advent International Corporation,
Name:_________________________________        General Partner
             General Partner

VENROCK ASSOCIATES II, L.P.               By:___________________________________
                                                        Vice President

By:___________________________________    ADVENT INTERNATIONAL INVESTORS II
                                          LIMITED PARTNERSHIP

By:___________________________________    By: Advent International Corporation,
                                              General Partner
Name:_________________________________
             General Partner
                                          By:___________________________________
VENROCK ASSOCIATES                                      Vice President

By:___________________________________

Name:_________________________________
             General Partner

                                          GOLDEN GATE DEVELOPMENT AND
VENROCK ASSOCIATES I, L.P.                INVESTMENT LIMITED PARTNERSHIP

                                          By: Advent International Limited
By:___________________________________        Partnership, General Partner

Name:_________________________________    By: Advent International
             General Partner                  Corporation,General Partner

VENROCK ASSOCIATES L.P.                   By:___________________________________
                                                        Vice President
By:___________________________________

Name:_________________________________
             General Partner

                     [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]

<PAGE>

ADVENT PERFORMANCE MATERIALS              LOMBARD ODIER & CIE
LIMITED PARTNERSHIP

By: Advent International Limited          By:___________________________________
    Partnership, General Partner
                                          Name:_________________________________

By: Advent International Corporation,
    General Partner                       Title:________________________________

By:___________________________________
             Vice President
                                          ______________________________________
                                          Thomas A. Bologna
ADVENT PARTNERS LIMITED PARTNERSHIP

By: Advent International Corporation,
    General Partner

By:___________________________________
             Vice President

______________________________________
Bernard Mach

SHIRE PHARMACEUTICALS GROUP PLC, AS
SUCCESSOR IN INTEREST TO BIOCHEM
PHARMA, INC.

By:___________________________________

Name:_________________________________

Title:________________________________

                     [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]

<PAGE>

SCRIPT PARTNERS LIMITED PARTNERSHIP

By:___________________________________

Name:_________________________________

Title:________________________________

CDP CAPITAL TECHNOLOGY VENTURES, AS
SUCCESSOR IN INTEREST TO SOCIETE FINANCIERE
D'INNOVATION, SOFINOV

By:___________________________________

Name:_________________________________

Title:________________________________

BIOMEDICINE, L.P.

By: INTERNATIONAL BM BIOMEDICINE
    HOLDINGS (CAYMAN) LTD.,
    its General Partner

By:___________________________________

Name: Dr. Gaudenz I. Staehelin

Title: Chairmen

By:___________________________________

Name: Philip J. Suttcliffe

Title: Director

By:___________________________________

Name: Julie Arnall

Title: Director

                     [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]

<PAGE>

AVENTIS, S.A.

By:___________________________________________

Name:_________________________________________

Title:________________________________________

______________________________________________
K. G. Xanthopoulos, Trustee of the K.G.
Xanthopoulos Trust, established January 30,
2002, as successor in interest in Kleanthis G.
Xanthopoulos

______________________________________________
Spyros Artavanis-Tsakonas

______________________________________________
Charles Cohen

______________________________________________
Stelios Papadopoulos

______________________________________________
Carrolee Barlow

______________________________________________
Kathleen Wiltsey

______________________________________________
Peer Bork

DUPONT PHARMA

By:___________________________________________

Name:_________________________________________

Title:________________________________________

                     [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]

<PAGE>

______________________________________
K.C. Nicolaou

SGC PARTNERS I LLC

By: SG Merchant Banking Fund L.P.
    its managing member

By: SG Capital Partners L.L.C.
    its general partner

By:___________________________________

Name:_________________________________

Title:________________________________

SG COWEN VENTURES I, L.P.

By:___________________________________

Name:_________________________________

Title:________________________________

PACIFIC RIM LIFE SCIENCE NO. 1
INVESTMENT PARTNERSHIP

By:___________________________________

By:___________________________________

Name:_________________________________

Title:________________________________

                     [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]

<PAGE>

PACIFIC RIM LIFE SCIENCE NO. 2
INVESTMENT PARTNERSHIP

By:___________________________________

By:___________________________________

Name:_________________________________

Title:________________________________

PACIFIC RIM LIFE SCIENCE NO. 3
INVESTMENT PARTNERSHIP

By:___________________________________

By:___________________________________

Name:_________________________________

Title:________________________________

NORTHERN STREAM CAPITAL, LLC

By:___________________________________

By:___________________________________

Name:_________________________________

Title:________________________________

______________________________________
Devron Averett

                     [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]

<PAGE>

______________________________________
W. Neil Fox

______________________________________
Ronald W. Jawor (with Irmgard Jawor,
as JTWROS)

______________________________________
Irmgard Jawor (with Ronald W. Jawor,
as JTWROS)

______________________________________
Neil J. Sandler

LYNWOOD CORPORATION

By:___________________________________

Name:_________________________________

Title:________________________________

LANDESKREDITBANK                          PRISMA INVEST LTD.
BADEN-WUERTTEMBER-FODERBANK

By:___________________________________    By:___________________________________

Name:_________________________________    Name:_________________________________

Title:________________________________    Title:________________________________

______________________________________
Peter Reikes

                     [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]

<PAGE>

CARE CAPITAL INVESTMENTS II, LP           ATLAS VENTURE FUND II, L.P.

By:___________________________________    By:___________________________________

Name:_________________________________    Name:_________________________________

Title:________________________________    Title:________________________________

HBM BIOVENTURES (CAYMAN) LTD.

By:___________________________________

Name: John Arnold

Title: Chairman and Managing Director

                                          FCPR SGAM BIOTECHNOLOGY FUND

VENROCK ASSOCIATES                        By: By SG Asset Management
                                              its management Company

By:___________________________________    By:___________________________________

Name:_________________________________    Name: Jean Grimaldi

Title:________________________________    Title: Head of Private Equity

By:___________________________________    By:___________________________________

Name:_________________________________    Name:_________________________________

Title:________________________________    Title:________________________________

______________________________________
Stelios Papadopoulos

______________________________________
Michael Kamdar

                     [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]

<PAGE>

______________________________________
Rodney Young

______________________________________
Charles Mather

______________________________________
Declan Quirke

CHORY WORLAND FAMILY TRUST OF 2001

By:___________________________________

Name: Stephen T. Worland

Title: Co-Trustee

______________________________________
Mark Secrest

                     [SIGNATURE PAGE TO AMENDED AND RESTATED
                         REGISTRATION RIGHTS AGREEMENT]

<PAGE>

                                   SCHEDULE A

CW VENTURES II, L.P.
ACCEL IV L.P.
ACCEL INVESTORS `93 L.P.
ACCEL JAPAN L.P.
ACCEL KEIRETSU L.P.
ELLMORE C. PATTERSON PARTNERS
PROSPER PARTNERS
ATLAS VENTURE FUND II, L.P.
NEW ENTERPRISE ASSOCIATES 5
VENROCK ASSOCIATES
VENROCK ASSOCIATES II, L.P.
ROVENT II LIMITED PARTNERSHIP
GOLDEN GATE DEVELOPMENT AND INVESTMENT LIMITED PARTNERSHIP
ADVENT INTERNATIONAL INVESTORS II LIMITED PARTNERSHIP
ADVENT PERFORMANCE MATERIALS LIMITED PARTNERSHIP
ADVENT PARTNERS LIMITED PARTNERSHIP
BERNARD MACH
LOMBARD ODIER & CIE
SCRIPT PARTNERS LIMITED PARTNERSHIP
THOMAS A. BOLOGNA
CARE CAPITAL INVESTMENTS II, L.P
BIOMEDICINE L.P.
HBM BIOVENTURES CAYMAN LTD
LYNWOOD CORPORATION
SGC PARTNERS I, LLC
SG ASSET MANAGEMENT
STELIOS PAPADOPOULOS
PETER REIKES
MICHAEL KAMDAR
CHORY WORLAND FAMILY TRUST OF 2001
RODNEY YOUNG
DECLAN QUIRKE
CHARLES MATHER
MARK SECREST
LANDESKREDITBANK BADEN-WUERTTEMBER-FODERBANK
PRISMA INVEST LTD.

<PAGE>

                                   SCHEDULE B

K. G. XANTHOPOULOS, TRUSTEE OF THE K.G. XANTHOPOULOS TRUST,
ESTABLISHED JANUARY 30, 2002
SPYROS ARTAVANIS-TSAKONAS
CHARLES COHEN
STELIOS PAPADOPOULOS
K.C. NICOLAOU
CARROLEE BARLOW
KATHLEEN WILTSEY
PEER BORK