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                                                                   Exhibit 10.56

[CONNETICS LETTERHEAD]


July 1, 1998


Robert G. Lederer
115 River Street
Norwell, MA  02061

Dear Bob,

     On behalf of Connetics Corporation (the "Company"), I am pleased to offer
you the position of Senior Vice President, Sales and Marketing. Speaking for the
Board, as well as the other members of the Company's management team, we are all
very impressed with your achievements to date and your approach to building
successful organizations. We all look forward to a mutually profitable and
enjoyable relationship as we build Connetics Sales and Marketing into a premier
biopharmaceutical company together.

     The terms of your employment relationship with the Company will be as set
forth below:

     1. POSITION: You will become the Senior Vice President, Sales and
Marketing. As such, you will have overall responsibility for directing the sales
and marketing activities of the Company toward the achievement of its business
objectives as developed by the senior management team. In addition, as a member
of the Senior Management Team, you will help set the overall direction and
strategy for the company, and measure progress against our goals.

     2. COMPENSATION:

          a.   BASE SALARY. You will be paid a base annual salary of $225,000,
               payable in two equal payments per month pursuant to the Company's
               regular payroll policy.

          b.   PERFORMANCE BONUS. You will be eligible to receive a target
               performance bonus of approximately 30% of your base salary. You
               and I will design a bonus plan that will provide you, and your
               sales and marketing team, with significant bonus upside for
               exceeding corporate sales goals. The amount of bonus you actually
               receive will be based on achievement of mutually acceptable
               quarterly milestones to be agreed to by you and me, and approved
               by the Compensation Committee of the Board of Directors. As a
               member of senior management you will also be responsible for
               reviewing performance bonuses in future years and implementing
               bonus plans that recruit and reward employees based on
               achievement of objectives.

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          c.   ANNUAL REVIEW. Your base salary will be reviewed at the end of
               each calendar year as part of the Company's normal salary review
               process for officers.

     3. STOCK OPTIONS:

          a.   STOCK PURCHASE. The Board of Directors has granted you an
               opportunity to purchase 110,000 shares ("Shares") of the
               Company's Common Stock at the fair market value of $3.75 the date
               of your employment. Such shares will vest at the rate of 1/8th of
               the original number of shares on your eighth-month anniversary of
               your employment date and 1/48th of the original number of shares
               on each month thereafter (total vesting in 48 months). Vesting
               will, of course, depend on your continued employment with the
               Company.

          b.   ACCELERATION OF VESTING. 100% of your unvested stock will vest in
               the event of any sale or merger in which control of the Company
               is transferred.

     4. RELOCATION EXPENSES:

          a.   EXPENSE REIMBURSEMENT. The Company will reimburse you for actual
               out-of-pocket expenses for relocation, including legal expenses,
               expenses incurred in connection with the sale of your home (such
               as brokerage fees and closing costs), expenses incurred in
               purchasing a home (such as loan fees), travel expenses from
               Boston to San Francisco for you and your wife (a maximum of two
               trips each, coach class) and moving expenses.

          b.   LOANS. The Company will grant you a loan of $36,000 within 180
               days of your employment with the Company and an additional loan
               of an identical amount on the first anniversary of the loan.
               These loans are intended to cover interest payments on the
               increased mortgage costs to which you will be subject by
               purchasing a home in California. These loans will bear interest
               at the lowest rate allowed by applicable law. The loans will be
               secured by your Company Common Stock. Each loan will have a
               three-year term. Interest will accrue and be payable at the end
               of the term of the loan. The Board of Directors will consider
               forgiveness of these loans and accrued interest as they become
               due. If you prefer a straight monthly housing allowance, we can
               structure it this way.

          c.   SIGN-ON BONUS. The Company will pay you a one-time sign on bonus
               of $25,000, less applicable taxes, to cover miscellaneous moving
               expenses, payable thirty days after employment. An additional
               bonus of $10,000, less applicable taxes, payable upon employment.
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        5. BENEFITS: The Company will also make available to you standard
vacation, medical, and dental insurance benefits. In addition, the Company
currently indemnifies all officers and directors to the maximum extent permitted
by law, in which you will be included. The Company will commit contractually to
advance any expenses for which indemnification is available to the extent
allowed by applicable law.


        6. SEVERANCE AGREEMENT: In the event of termination of your employment
with the Company other than for cause, you will be entitled to receive
continuation of salary and benefits for six months following your termination
date. In addition, you will be entitled to continue all vesting with respect to
Company stock during such six-month period.

        7. START DATE: Your employment with the Company will commence on June 5,
1998. You will initially begin as a part time employee through August 31. During
this period, you will be paid at 1/2 your salary.

        8. MISCELLANEOUS: Except as described above, your employment with the
Company will be on an "at will" basis, meaning that either you or the Company
may terminate your employment at any time for any reason or no reason. Like all
Company employees, you will be required to sign the Company's Standard Employee
Agreement relating to protection of the Company's proprietary and confidential
information and assignment of inventions, a copy of which is attached. As a
condition of your employment with Connetics, you will be required to provide
proof of US citizenship or that you are legally entitled to work in the United
States, and to execute and be bound by the terms of the enclosed Proprietary
Information And Invention Agreement. In that regard, please be aware that
Company policy prohibits all employees from bringing to Connetics, or using in
performance of their responsibilities at Connetics, any confidential
information, trade secrets, or propriety material or processes of any previous
employer. Employment with the Company is at will, is not for any specific term
and can be terminated by you or the Company at any time for any reason with or
without cause.

        Bob, we are all delighted to be able to extend you this offer and we
look forward to working together. Please indicate your acceptance by signing and
returning the enclosed copy of this letter.


Very truly yours,


/s/ TOM WIGGANS
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Thomas G. Wiggans
President and CEO



UNDERSTOOD AND ACCEPTED:

/s/ ROBERT G. LEDERER
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Robert G. Lederer          Date