EXHIBIT B
                           COPLEY PHARMACEUTICAL, INC.
                        1986 INCENTIVE STOCK OPTION PLAN
1.       Purpose of the Plan
         This  1986   Incentive   Stock  Option  Plan  (the  "Plan")  of  Copley
Pharmaceutical,  Inc., a Massachusetts  corporation (the "Company"), is designed
to provide  additional  incentive  to  present  and  future  executives  and key
employees  of  the  Company  and  of  its  subsidiaries  by  affording  them  an
opportunity  to acquire or increase  their  proprietary  interest in the Company
through the  acquisition  of shares of its Common Stock.  By  encouraging  stock
ownership  by such  executives  and  salaried  employees,  the Company  seeks to
attract and retain in its employ persons of exceptional  competence and seeks to
furnish an added  incentive for them to increase  their efforts on behalf of the
Company. 2. Administration.
         The Plan shall be administered by the Board of Directors. All questions
of interpretation and application of the Plan, of options granted hereunder (the
"options"),  and of the value of shares of Common  stock  subject  to an option,
shall  be  subject  to  the  determination  of  the  Board  of  Directors  which
determination shall be final and binding. 3. Option Shares.
         The stock subject to the options and other provisions of the Plan shall
be shares of the Company's  Class B  (Non-Voting)  Common Stock,  $.01 par value
(the  "Common  Stock") . The total  amount of the Common  Stock with  respect to
which options may be granted shall not exceed in the  aggregate  20,000  shares;
provided,  however,  that the class and aggregate  number of shares which may be
subject  to  options  granted  hereunder  shall  be  subject  to  adjustment  in
accordance  with the  provisions  of  Paragraph  16 hereof.  Such  shares may be
treasury shares or authorized but unissued shares.
         In the event that any outstanding option for any reason shall expire or
terminate  prior to  exercise,  the  shares of  Common  Stock  allocable  to the
unexercised  portion of such option may again be subject to an option  under the
Plan.
4.       Authority to Grant Option.
         The  Board of  Directors  may grant  options  from time to time to such
eligible  employees  of  the  Company  as it  shall  determine.  Subject  to any
applicable limitations set forth in the Plan or established from time to time by
the Board of  Directors,  the number of shares of Common  Stock to be covered by
any option shall be as determined by the Board of  Directors.  5.  Limitation On
Amount of Options Which May Be Granted To Any Employee.
         The aggregate  fair market value  (determined as of the time the option
is granted) of the Common Stock for which any employee may be granted options in
any  calendar  year  under the Plan and any other  plans of the  Company  or any
parent or subsidiary of the Company for the issue of "incentive  stock  options"
as defined in Section 422A of the Internal Revenue Code of 1954 shall not exceed
$100,000 plus any unused limit carryover to such year permitted by Section 422A.
6. Eligibility.
         The  individuals who shall be eligible to participate in the Plan shall
be such  executives  and key  employees  of the  Company,  or of any  subsidiary
corporation, as the Board of Directors shall from time to time.
         No option shall be granted to an individual who, as the time the option
is granted,  owns (including ownership attributed pursuant to Section 425 of the
Internal Revenue Code of 1954) more than ten percent (10%) of the total combined
voting power of all classes of stock of the Company or any  subsidiary or parent
(a   "greater-than-ten-percent-stockholder");   notwithstanding   the  above,  a
greater-than-ten-percent-stockholder  may be granted an option provided that the
purchase  price per share  shall not be less than one  hundred  and ten  percent
(110%) of the fair market value of the stock at the time such option is granted,
and further  provided  that no such option  shall be  exercisable  to any extent
after the expiration of five (5) years from the date it is granted.
     Except  as  otherwise  provided  for  all  purpose  of the  Plan  the  term
"subsidiary  corporation" shall meanany  corporation of which 50% or more of its
outstanding  voting  stock is at the time owned by the Company or by one or more
subsidiaries or by the Company and one or more subsidiaries.
7.       Option Price.
         The price at which shares may be purchased pursuant to options shall be
specified by the Board of Directors at the time the option is granted, and shall
not be less than one hundred  percent (100%) (one hundred and ten percent (110%)
in the case of a greater-than-ten  percent-stockholder) of the fair market value
of the  shares of Common  Stock on the date the  option  is  granted,  such fair
market value to be determined in accordance with procedures to be established by
the Board of Directors. 8. Duration of Options.
         The Board of  Directors  in its  discretion  may provide that an option
shall be  exercisable  during  any  specified  period of time from the date such
option is granted  not  exceeding  ten (10) years  (five  years in the case of a
greater-than-ten-percent-stockholder)  from the date of  grant.  Notwithstanding
the  foregoing,  an option  granted  to an  individual  under the Plan (the "new
option") shall not be exercisable while there is outstanding (within the meaning
of Section  422A(c)(7) of the Internal  Revenue Code) any incentive stock option
which was  granted  to such  individual  prior to the grant of the new option to
purchase  stock of the  Company  or in a  corporation  which (at the time of the
granting  of the new  option)  is a  parent  or  subsidiary  corporation  of the
Company, or is a predecessor corporation of any of such corporations.  9. Amount
Exercisable; Vesting of Shares Purchased.
         Each option may be exercised,  so long as it is valid and  outstanding,
from time to time in part or as a whole, subject to any limitations with respect
to the number of shares for which the option may be  exercised  at a  particular
time and to such other  conditions  as the Board of Directors in its  discretion
may specify upon granting the option.
         The Board of Directors may also or alternatively  specify upon granting
an option that all or a portion of the shares  purchasable upon exercise thereof
are subject to  repurchase  by the Company at the exercise  price for which they
were  originally  purchased  upon  termination of the employment of the optionee
before the option vesting date specified in the option.  If any such restriction
is imposed,  the option shall  contain  appropriate  provisions or shall provide
that the optionee must execute and deliver a repurchase  agreement upon exercise
of the option,  and the shares  issued upon exercise  shall bear an  appropriate
legend  disclosing  the  Company's  right to  repurchase  unvested  shares.  10.
Exercise of Options.
         Subject to the  provisions  of  Paragraph 13 hereof,  options  shall be
exercised by the  delivery of written  notice to the Company  setting  forth the
number of shares with respect to which the option is to be  exercised,  together
with (a) cash,  certified  check,  bank draft or postal or express  money  order
payable to the order to the Company for an amount  equal to the option  price of
such shares,  or (b) with the consent of the Company,  shares of Common Stock of
the Company having a fair market value equal to the option price of such shares,
or (c) with the  consent  of the  Company,  a  combination  of (a) and (b),  and
specifying  the  address  to which the  certificates  for such  shares are to be
mailed. For the purpose of the preceding sentence,  the fair market value of the
shares of Common  Stock so  delivered  to the  Company  shall be  determined  in
accordance  with  procedures  adopted by the Board of Directors.  As promptly as
practicable after receipt of such written  notification and payment, the Company
shall deliver to the optionee certificates for the number of shares with respect
to which  such  option has been so  exercised,  issued in the  optionee's  name;
provided,  however that such delivery shall be deemed  effected for all purposes
when  a  stock   transfer  agent  of  the  Company  shall  have  deposited  such
certificates  in the United  States  mail,  addressed  to the  optionee,  at the
address specified pursuant to this Paragraph 12.
11.      Transferability of Options.
         Options shall not be  transferable  by the optionee  otherwise  than by
will or under the laws of descent and  distributions,  and shall be exercisable,
during his lifetime, only by him.
12.      Termination of Employment or Death of Optionee.
         Except as may be otherwise  expressly  provided herein, the options may
not be exercised after the earlier of:
         (i)      the date of expiration thereof; or
         (ii) The date of  termination  of the  optionee's  employment  with the
Company by it for case (as  determined by the Company),  or  voluntarily  by the
optionee; or,
         (iii)    ninety (90)days after termination of the optionee's employment
with the Company by it without cause.
         Temporary  Leave.  Whether  authorized  temporary leave of absence,  or
absence on military or government service,  shall constitute  termination of the
employment relationship between the Company and the optionee shall be determined
by the Board of Directors at the time thereof.
         Death or Disability. In the event the optionee shall be retired in good
standing from the employ of the Company for reasons of disability under the then
established  rules of the  Company or in the event of the death of the holder of
an option  while in the employ of the Company and before the date of  expiration
of such option,  such option may be exercised  until the earlier of such date of
expiration  or six months  following the date of such  retirement  for reason of
disability  or such death,  to the extent the  optionee was entitled to exercise
such option immediately  before his death. After the death of the optionee,  his
executors,  administrators  or any  person or  persons to whom his option may be
transferred by will or by the laws of descent and  distribution,  shall have the
right to exercise the option.
         Retirement.  If,  before  the date of  expiration  of the  option,  the
optionee  shall be retired in good  standing  from the employ of the Company for
reasons of age under the then established  rules of the Company,  the option may
be exercised  until the earlier of such date of  expiration or 90 days after the
date of such  retirement,  to the extent to which the  optionee  was entitled to
exercise such option immediately prior to such retirement.
     Employment Relationship. An employment relationship between the Company and
the optionee shall be deemed to exist during any period in which the optionee is
employed by the Company or by any subsidiary corporation.
13.      Requirements of Law.
         The Company shall not be required to sell or issue any shares under any
option if the  issuance  of such shares  shall  constitute  a  violation  by the
optionee or by the Company of any  provision of any law,  regulation or order of
any  governmental  authority.  Without limiting the generality of the foregoing,
upon  exercise  of any option,  the Company  shall not be required to issue such
shares unless the Board of Directors has received evidence satisfactory to it to
the effect that the holder of such option will not transfer  such shares  except
pursuant to a registration statement in effect under the Securities Act of 1933,
as now in effect or  hereafter  amended (the  "Act"),  and under the  applicable
securities  laws of any State,  unless the  Company  has  received an opinion of
counsel  satisfactory to the Company, in form and substance  satisfactory to the
Company, to the effect that such registration is not required. Any determination
in this  connection  by the  Board of  Directors  shall be  final,  binding  and
conclusive.  In the event the shares  issuable  on exercise of an option are dot
registered  under the Act, the Company may imprint the  following  legend or any
other legend which counsel for the Company  considers  necessary or advisable to
comply with the Act or other applicable laws:
         "The  shares of stock  represented  by this  certificate  have not been
         registered  under the  Securities  Act of 1933 or under the  securities
         laws of any State and may not be sold or  transferred  except upon such
         registration  or upon  receipt  by the  Corporation  of an  opinion  of
         counsel  satisfactory  to  the  Corporation,   in  form  and  substance
         satisfactory to the Corporation,  that registration is not required for
         such sale or transfer."

The Company may, but shall in no event be obligated to,  register any securities
covered  hereby  pursuant  to the  Act;  and  in the  event  any  shares  are so
registered the Company may remove any legend on certificates  representing  such
shares.  The Company shall not be obligated to take any other affirmative action
in order to cause the exercise of an option or the  issuance of shares  pursuant
thereto to comply with any other law,  regulation  or order of any  governmental
authority. 14. No Rights as Stockholder.
         No optionee  shall have rights as a stockholder  with respect to shares
covered by his option until the date of issuance of a stock certificate for such
shares;  and, except as otherwise provided in Paragraph 16 hereof, no adjustment
for dividends, or otherwise,  shall be made if the record date therefor is prior
to the date of issuance of such certificate. 15. Employment Obligation.
         The  granting  of any option  shall not  impose  upon the  Company  any
obligation  to employ or continue to employ any  optionee;  and the right of the
Company to terminate the  employment of any officer or other  employee shall not
be  diminished or affected by reason of the fact that an option has been granted
to him.
16.      Changes in the Company's Capital Structure.
The  existence of  outstanding  options shall not affect in any way the right or
power  of the  Company  or its  stockholders  to  make or  authorize  any or all
adjustments,   recapitalizations,   reorganizations  or  other  changes  in  the
Company's capital  structure or its business,  or any merger or consolidation of
the Company,  or any issue of bonds,  debentures,  preferred or prior preference
stock  ahead of or  affecting  the Common  Stock or the rights  thereof,  or the
dissolution  or liquidation of the Company or any sale or transfer of all or any
part of its  assets or  business,  or any  other  corporate  act or  proceeding,
whether of a similar character or otherwise.
         If the Company shall effect a subdivision or  consolidation  of s hares
or  other  capital  readjustment,  the  payment  of a stock  dividend,  or other
increase or reduction  of the number of shares of the Common Stock  outstanding,
without receiving compensation therefor in money, services or property, then (i)
the number, class, and per share price of shares of stock subject to outstanding
options hereunder shall be appropriately adjusted in such a manner as to entitle
an optionee to receive upon exercise of an option,  for the same  aggregate cash
consideration,  the same  total  number  and class of  shares  as he would  have
received as a result of the event  requiring the adjustment had he exercised his
option in full immediately prior to such event; and (ii) the number and class of
shares  with  respect to which  options  may be granted  under the Plan shall be
adjusted by substituting for the total number of shares of stock that would have
been  received by the owner of an equal number of  outstanding  shares of Common
Stock as the result of the event requiring the adjustment. After a merger of one
or more corporations  into the Company,  or after a consolidation of the Company
and one or more  corporations  in  which  the  Company  shall  be the  surviving
corporation,  each holder of an outstanding option shall, at no additional cost,
be entitled  upon  exercise of such option to receive  (subject to any  required
action by  stockholders) in lieu of the number of shares as to which such option
shall then be so  exercisable,  the number and class of shares of stock or other
securities to which such holder would have been  entitled  pursuant to the terms
of the agreement of merger or consolidation if, immediately prior to such merger
or  consolidation,  such  holder  had been the  holder  of record of a number of
shares of Common  Stock  equal to the number of shares as to which  such  option
shall be so exercised.
         If the Company is merged into or consolidated with another  corporation
under  circumstances where the Company is not the surviving  corporation,  or if
the Company is liquidated,  or sells or otherwise  disposes of substantially all
its assets to another  corporation while unexercised  options remain outstanding
under the Plan, (i) subject to the  provisions of clause (iii) below,  after the
effective date of such merger,  consolidation  or sale, as the case may be, each
holder of an outstanding option shall be entitled, upon exercise of such option;
to  receive,  in lieu of shares of Common  Stock,  shares of such stock or other
securities,  cash or property as the holders of shares of Common Stock  received
pursuant to the terms of the merger,  consolidation  or sale;  (ii) the Board of
Directors may accelerate the time for exercise of all  unexercised and unexpired
options  to and  after a  .date  prior  to the  effective  date of such  merger,
consolidation,  liquidation or sale, as the case may be, specified by the Board;
or (iii) all  outstanding  options may be cancelled by the Board of Directors as
of the effective  date of any such merger,  consolidation,  liquidation  or sale
provided that (x) notice of such  cancellation  shall be given to each holder of
an option and (y) each holder of an option shall have the right to exercise such
option to the  extent  that the same is then  exercisable  or, if the  Directors
shall have  accelerated  the time for exercise of all  unexercised and unexpired
options,  in full during the 30-day period  preceding the effective date of such
merger, consolidation, liquidation, sale or acquisition.
         Except as hereinbefore  expressly provided, the issue by the Company of
shares of stock of any class, or securities  convertible into shares of stock of
any class,  for cash or  property,  or for labor or services  either upon direct
sale or upon the exercise of rights or warrants to subscribe  therefor,  or upon
conversion of shares or obligations of the Company  convertible into such shares
or other securities, shall not affect, and no adjustment by reason thereof shall
be made with  respect  to,  the  number or price of shares of Common  Stock then
subject to outstanding options. 17. Amendment or Termination of Plan.
         The Board of Directors may modify, revise or terminate this Plan at any
time and from time to time,  except  that the  class of  employees  eligible  to
receive  options and the aggregate  number of shares  issuable  pursuant to this
Plan shall not be changed or increased,  other than by operation of Paragraph 16
hereof, without the consent of the stockholders. 18. Written Agreement.
         Each option  granted  hereunder  shall be embodied in a written  option
agreement  which shall be subject to the terms and conditions  prescribed  above
and shall be signed by the President, any Vice President or the Treasurer of the
Company  for and in the  name  and on  behalf  of the  Company.  Such an  option
agreement  shall contain such other  provisions as the Board of Directors in its
discretion shall deem advisable.
19.      Effective Date and Duration of Plan.
         The Plan  shall  become  effective  upon its  adoption  by the Board of
Directors, provided the stockholders of the Company shall have approved the Plan
within  twelve (12) months prior to or following the adoption of the Plan by the
Board of Directors. Options may not be granted under the Plan more than ten (10)
years after said  effective  date.  The Plan shall  terminate (i) when the total
amount of the Common  Stock with respect to which  options may be granted  shall
have been issued upon the  exercise of options or (ii) by action of the Board of
Directors  pursuant to Paragraph  17 hereof,  whichever  shall first occur.  20.
Repurchase Rights.
         The Board of Directors may in its discretion  provide upon the grant of
any option  hereunder that the Company shall have an option to repurchase all or
any number of shares purchased upon exercise of such option within 60 days prior
to, or after,  (a) the  termination  of  employment  of the employee to whom the
option was granted, or (b) the exercise of an option by a former employee or his
estate  following  termination  of employment.  The  repurchase  price per share
payable by the Company  shall be such amount or be determined by such formula as
is fixed by the Board of Directors at the time the option for the shares subject
to  repurchase  was  granted.  In the event the Board of  Directors  shall grant
options  subject  to  the  Company's   repurchase   option,   the   certificates
representing the shares  purchased  pursuant to such option shall carry a legend
satisfactory  to counsel for the C any  referring  to the  Company's  repurchase
option.
                                        * * *