Exhibit
10.38


Executive
Officer Compensation Summary


CollaGenex Pharmaceuticals, Inc.’s (the “Company’s”)
executive officers consist of: (i) Colin W. Stewart, President and Chief
Executive Officer; (ii) Nancy C. Broadbent, Senior Vice President and
Chief Financial Officer; (iii) David F. Pfeiffer, Senior Vice President of
Sales and Marketing; (iv) Klaus Theobald, Senior Vice President and Chief
Medical Officer; (v) Andrew Powell, Vice President, General Counsel and
Secretary and (vi) Greg Ford, our Vice President, Business Development and
Strategic Planning.


The compensation structure for executive officers of
the Company consists of three components: base salary, discretionary cash
bonuses (typically paid annually) and stock options. The Company does not have
employment agreements with any of its executive officers, but has executed
indemnification agreements with each of its executive officers.  In
addition, the Company has entered into change of control agreements with each
of Mr. Stewart, Ms. Broadbent, Mr. Pfeiffer, Mr. Powell,
Dr. Theobald and Mr. Ford.


The Compensation Committee of the Board of Directors
(the “Committee”) seeks to establish base salaries for each position and level
of responsibility that are competitive with those of executive officers at
other emerging pharmaceutical companies. Annual cash bonuses are awarded to
executive officers based on their achievements against a stated list of
objectives developed at the beginning of each year by senior management and the
Committee. All executive officers are awarded option grants upon joining the
Company that are competitive with those at comparable emerging pharmaceutical
companies. In addition, the Committee may award additional stock option grants
annually. When granting stock options, the Committee considers the
recommendation of the Company’s Chief Executive Officer and the relative
performance and contributions of each executive officer.


Compensation decisions affecting the Company’s
executive officers are made on an annual basis by the Committee. On December 7,
2006, the Committee approved the terms of compensation (exclusive of option
grants) to be paid to the Company’s executive officers, including the base
salary for 2007, as follows:


·                                          Mr. Stewart. The Committee approved a
10% increase in Mr. Stewart’s base salary for 2007, as well as a $258,246
bonus. As a result of the increase, Mr. Stewart’s base salary is now
$414,700.


·                                          Ms. Broadbent. The Committee approved
a 4% increase in Ms. Broadbent’s base salary for 2007, as well as a
$138,240 bonus. As a result of the increase, Ms. Broadbent’s base salary
is now $266,200.


·                                          Mr. Pfeiffer. The Committee approved
a 4% increase in Mr. Pfeiffer’s base salary for 2007, as well as a
$137,670 bonus. As a result of the increase, Mr. Pfeiffer’s base salary is
now $275,300.











·                                          Mr. Theobald. The Committee approved
a 7.7% increase in Mr. Theobald’s base salary for 2007, as well as a
$139,932 bonus. As a result of the increase, Mr. Theobald’s base salary is
now $290,000.


·                                          Mr. Powell. The Committee approved a
4% increase in Mr. Powell’s base salary for 2007, as well as a $123,786 bonus.
As a result of the increase, Mr. Powell’s base salary is now $247,500.


·                                          Mr. Ford. The Committee approved a 4%
increase in Mr. Ford’s base salary for 2007, as well as a $96,640 bonus. As a
result of the increase, Mr. Ford’s base salary is now $251,300.