Exhibit 10.10
                          REGISTRATION RIGHTS AGREEMENT


         This  REGISTRATION  RIGHTS  AGREEMENT (this  "Agreement"),  dated as of
January  16,  2004,  is  by  and  between  CELLEGY  PHARMACEUTICALS,  INC.  (the
"Company") and KINGSBRIDGE CAPITAL LIMITED (the "Investor").

         WHEREAS,  the Company and the  Investor  have entered into that certain
Common  Stock  Purchase  Agreement,  dated as of the date hereof (the  "Purchase
Agreement"),  pursuant to which the Company may issue, from time to time, to the
Investor up to 3,740,000 shares of Common Stock;

         WHEREAS, pursuant to the terms of, and in partial consideration for the
Investor  entering into, the Purchase  Agreement,  the Company has issued to the
Investor  a  warrant,  exercisable  from  time to time  within  five  (5)  years
following the six-month  anniversary of the date of issuance (the "Warrant") for
the purchase of an aggregate of up to 260,000  shares of Common Stock at a price
specified in such Warrant;

         WHEREAS,  pursuant to the terms of, and in partial  consideration  for,
the Investor's  agreement to enter into the Purchase Agreement,  the Company has
agreed to provide the Investor with certain  registration rights with respect to
the Registrable  Securities (as defined in the Purchase  Agreement) as set forth
herein;

         NOW, THEREFORE,  in consideration of the premises, the representations,
warranties,  covenants and agreements  contained herein, in the Warrant,  and in
the  Purchase  Agreement,  and for other good and  valuable  consideration,  the
receipt and sufficiency of which is hereby acknowledged, intending to be legally
bound hereby, the parties hereto agree as follows (capitalized terms used herein
and not defined  herein shall have the respective  meanings  ascribed to them in
the Purchase Agreement):


                                    ARTICLE I
                               REGISTRATION RIGHTS

Section 1.1.      REGISTRATION STATEMENT.

                  (a) Filing of the Registration  Statement.  Upon the terms and
subject to the  conditions set forth in this  Agreement,  the Company shall file
with the Commission,  within five (5) days after the date by which the Company's
annual  report on Form 10-K with respect to the year ended  December 31, 2003 is
required to be filed with the Commission,  a registration  statement on Form S-1
under the Securities Act or such other form as deemed  appropriate by counsel to
the  Company  for  the  registration  for  the  resale  by the  Investor  of the
Registrable Securities (the "Registration Statement").

                  (b) Effectiveness of the Registration  Statement.  The Company
shall use commercially reasonable efforts (i) to have the Registration Statement
declared effective by the Commission as soon as reasonably  practicable,  but in
any event no later than  thirty-five (35) calendar days, or eighty (80) calendar
days in the  event  that the  Commission  reviews  the  Registration  Statement,
following the date that the  Registration  Statement is filed and (ii) to ensure
that the Registration  Statement  remains in effect  throughout the term of this
Agreement as set forth in Section 4.2,  subject to the terms and  conditions  of
this Agreement.

                  (c) Regulatory  Disapproval.  The contemplated  effective date
for the Registration  Statement as described in Section 1.1(b) shall be extended
without default or liquidated  damages hereunder or under the Purchase Agreement
in the event  that the  Company's  failure to obtain  the  effectiveness  of the
Registration  Statement on a timely basis results  solely from the  Commission's


<PAGE>

disapproval of the structure of the  transactions  contemplated  by the Purchase
Agreement.  In such event,  the parties  agree to cooperate  with one another in
good faith to arrive at a resolution acceptable to the Commission.

                  (d)  Failure  to  Maintain   Effectiveness   of   Registration
Statement.  In the event the Company fails to maintain the  effectiveness of the
Registration  Statement (or the  Prospectus)  throughout the period set forth in
Section 4.2, other than temporary  suspensions as set forth in Section 1.1(e) or
2.1(n), and the Investor holds any Registrable Securities at any time during the
period of such ineffectiveness (an "Ineffective  Period"), the Company shall pay
to the Investor in immediately available funds into an account designated by the
Investor an amount equal to the product of (x) the total  number of  Registrable
Securities issued to the Investor under the Purchase  Agreement and owned by the
Investor  at any time  during such  Ineffective  Period and (y) the  result,  if
greater  than  zero,  obtained  by  subtracting  the  VWAP  on the  Trading  Day
immediately  following the last day of such Ineffective  Period from the VWAP on
the  Trading Day  immediately  preceding  the day on which any such  Ineffective
Period began; provided,  however, that the foregoing payments shall not apply in
respect of  Registrable  Securities  that are otherwise  freely  tradable by the
Investor.

                  (e)  Deferral  or   Suspension   During  a  Blackout   Period.
Notwithstanding the provisions of Section 1.1 (d), if in the good faith judgment
of  the  Company,  following  consultation  with  legal  counsel,  it  would  be
detrimental to the Company or its stockholders for the Registration Statement to
be filed or for resales of  Registrable  Securities  to be made  pursuant to the
Registration  Statement  due to (i) the existence of a material  development  or
potential material  development  involving the Company that the Company would be
obligated to disclose in the Registration  Statement,  which disclosure would be
premature or otherwise inadvisable at such time or would have a Material Adverse
Effect  on  the   Company   or  its   stockholders,   or  (ii)  a  filing  of  a
Company-initiated  registration of any class of its equity securities, which, in
the good  faith  judgment  of the  Company,  would  adversely  effect or require
premature  disclosure  of the  filing  of  such  Company-initiated  registration
(notice thereof, a "Blackout  Notice"),  the Company shall have the right to (A)
immediately  defer  such  filing  for a period of not more than  sixty (60) days
beyond the date by which such  Registration  Statement  was  otherwise  required
hereunder to be filed or (B) suspend use of such  Registration  Statement  for a
period of not more than  thirty  (30) days  (any  such  deferral  or  suspension
period,  a  "Blackout  Period").  The  Investor  acknowledges  that it  would be
seriously  detrimental to the Company and its stockholders for such Registration
Statement  to be filed (or  remain  in  effect)  during a  Blackout  Period  and
therefore  essential  to defer such filing (or suspend the use  thereof)  during
such  Blackout  Period and agrees to cease any  disposition  of the  Registrable
Securities  during such Blackout Period.  The Company may not utilize any of its
rights under this Section 1.1(e) to defer the filing of a Registration Statement
(or suspend its effectiveness)  more than six (6) times in any twelve (12) month
period.  In the event that,  within  fifteen  (15) Trading  Days  following  any
Settlement  Date,  the Company  gives a Blackout  Notice to the Investor and the
VWAP on the Trading Day immediately  preceding such Blackout Period ("Old VWAP")
is greater than the VWAP on the first Trading Day following such Blackout Period
that the Investor may sell its Registrable  Securities  pursuant to an effective
Registration Statement ("New VWAP"), then the Company shall pay to the Investor,
by wire transfer of immediately funds to an account  designated by the Investor,
the "Blackout Amount." For the purposes of this Agreement, Blackout Amount means
a percentage equal to: (1) seventy-five percent (75%) if such Blackout Notice is
delivered prior to the fifth  (5th)Trading  Day following such Settlement  Date;
(2) fifty  percent  (50%) if such  Blackout  Notice is delivered on or after the
fifth  (5th)Trading  Day following such Settlement  Date, but prior to the tenth
(10th) Trading Day following such Settlement Date; (3) twenty-five percent (25%)
if such  Blackout  Notice is delivered on or after the tenth (10th)  Trading Day
following such  Settlement  Date, but prior to the fifteenth  (15th) Trading Day
following such  Settlement  Date;  and (4) zero percent (0%)  thereafter of: the
product of (i) the number of  Registrable  Securities  purchased by the Investor
pursuant  to the  most  recent  Draw  Down  and  actually  held by the  Investor
immediately  prior  to the  Blackout  Period  and (ii) the


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<PAGE>

result  obtained by subtracting the New VWAP from the Old VWAP. For any Blackout
Period in respect of which a Blackout  Amount  becomes due and  payable,  rather
than paying the Blackout Amount, the Company may at is sole discretion, issue to
the Investor shares of Common Stock with an aggregate market value determined as
of the first  Trading Day following  such Blackout  Period equal to the Blackout
Amount ("Blackout Shares")..

                  (f) Liquidated  Damages.  The Company and the Investor  hereto
acknowledge  and agree that the amounts payable under Sections 1.1(d) and 1.1(e)
and the Blackout Shares  deliverable under Section 1.1(e) above shall constitute
liquidated damages and not penalties.  The parties further  acknowledge that (i)
the amount of loss or damages likely to be incurred by the Investor is incapable
or is  difficult  to  precisely  estimate,  (ii) the amounts  specified  in such
subsections  bear a  reasonable  proportion  and  are  not  plainly  or  grossly
disproportionate  to the probable loss likely to be incurred in connection  with
any  failure  by the  Company to obtain or  maintain  the  effectiveness  of the
Registration  Statement,  (iii)  one of the  reasons  for  the  Company  and the
Investor  reaching an agreement as to such amounts was the  uncertainty and cost
of litigation regarding the question of actual damages, and (iv) the Company and
the Investor are  sophisticated  business  parties and have been  represented by
sophisticated and able legal and financial counsel and negotiated this Agreement
at arm's length.


                  (g) Additional  Registration  Statements.  In the event and to
the extent that the Registration Statement fails to register a sufficient amount
of Common Stock  necessary for the Company to issue and sell to the Investor and
the Investor to purchase from the Company all of the  Registrable  Securities to
be issued, sold and purchased under the Purchase Agreement and the Warrant,  the
Company  shall prepare and file with the  Commission an additional  registration
statement or statements in order to  effectuate  the purpose of this  Agreement,
the Purchase Agreement, and the Warrant.


                                   ARTICLE II
                             REGISTRATION PROCEDURES

Section 2.1.  FILINGS;  INFORMATION.  The Company shall effect the  registration
with  respect  to the sale of the  Registrable  Securities  by the  Investor  in
accordance with the intended  methods of disposition  thereof.  Without limiting
the  foregoing,  the  Company  in  each  such  case  will  do the  following  as
expeditiously  as  possible,  but in no event later than the  deadline,  if any,
prescribed therefor in this Agreement:
                  (a) Subject to Section  1.1(e),  the Company shall (i) prepare
and file with the Commission the Registration  Statement;  (ii) use commercially
reasonable efforts to cause such filed  Registration  Statement to become and to
remain  effective  (pursuant to Rule 415 under the Securities Act or otherwise);
(iii) prepare and file with the Commission  such  amendments and  supplements to
the  Registration  Statement and the Prospectus used in connection  therewith as
may be  necessary to keep such  Registration  Statement  effective  for the time
period  prescribed by Section 4.2 and in order to effectuate the purpose of this
Agreement,  the Purchase  Agreement,  and the Warrant;  and (iv) 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 Investor set forth in
such  Registration  Statement;  provided,  however,  that the Investor  shall be
responsible  for the  delivery  of the  Prospectus  to the  Persons  to whom the
Investor  sells the Shares and the Warrant  Shares,  and the Investor  agrees to
dispose of Registrable  Securities in compliance  with the plan of  distribution
described  in the  Registration  Statement  and  otherwise  in  compliance  with
applicable federal and state securities laws.

                  (b) If so requested by a managing underwriter or underwriters,
if any, or the holders of a majority of the Registrable Securities being sold in
connection with the filing of a Registration  Statement under the Securities Act
for the  offering on a continuous  or delayed  basis in the future of all of


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<PAGE>

the  Registrable  Securities  (a "Shelf  Registration"),  the Company  shall (i)
promptly incorporate in a prospectus supplement or post-effective amendment such
information as the managing underwriters,  if any, and such holders agree should
be  included  therein,  and (ii) make all  required  filings of such  prospectus
supplement or post-effective  amendment as soon as practicable after the Company
has received  notification  of the matters to be incorporated in such prospectus
supplement or  post-effective  amendment;  provided,  however,  that the Company
shall not be required to take any action  pursuant  to this  Section  2.1(b)(ii)
that would, in the opinion of counsel for the Company, violate applicable law.

                  (c)  In  the  event  of an  underwritten  (other  than  by the
Investor)  offering  of  Registrable  Securities  pursuant  to the  Registration
Statement,  the Company shall enter into such reasonable agreements and take all
such  other  reasonable  actions  in  connection   therewith   (including  those
reasonably requested by the managing underwriters,  if any) in order to expedite
or  facilitate  the  disposition  of such  Registrable  Securities,  and in such
connection,  the Company shall (i) make such  representations  and warranties to
the holders of such Registrable  Securities and the  underwriters,  if any, with
respect to the business of the Company  (including with respect to businesses or
assets  acquired  or to be  acquired  by  the  Company),  and  the  Registration
Statement,  Prospectus  and  documents,  if any,  incorporated  or  deemed to be
incorporated by reference therein, in each case, in form,  substance (subject to
such exceptions as the Company may disclose) and scope as are  customarily  made
by  issuers  to  underwriters  in  underwritten  offerings,   and  confirm  such
representations  and warranties if and when  requested;  (ii) if an underwriting
agreement  is entered  into,  it shall  contain  indemnification  provision  and
procedures  no  less  favorable  to the  selling  holders  of  such  Registrable
Securities  and the  underwriters,  if any, than those set forth herein (or such
other provisions and procedures acceptable to the Company, holders of a majority
of  Registrable  Securities  covered  by  such  Registration  Statement  and the
managing   underwriters,   if  any);   and  (iii)  deliver  such  documents  and
certificates as may be reasonably  requested by the holders of a majority of the
Registrable  Securities being sold, their counsel and the managing underwriters,
if any,  to  evidence  the  continued  validity  of  their  representations  and
warranties made pursuant to clause (i) above and to evidence compliance with any
customary conditions contained in the underwriting  agreement or other agreement
entered into by the Company.

                  (d) Three (3)  Trading  Days prior to filing the  Registration
Statement or  Prospectus,  or any  amendment or  supplement  thereto  (excluding
amendments  deemed  to  result  from the  filing of  documents  incorporated  by
reference  therein),  the Company  shall  deliver to the Investor and to counsel
representing the Investor,  in accordance with the notice  provisions of Section
4.8, copies of the Registration  Statement,  Prospectus and/or any amendments or
supplements  thereto as proposed to be filed,  together with  exhibits  thereto,
which documents will be subject to review by the Investor and such counsel,  and
thereafter  deliver to the Investor and such  counsel,  in  accordance  with the
notice  provisions  of Section  4.8,  such number of copies of the  Registration
Statement,  each  amendment and  supplement  thereto (in each case including all
exhibits thereto),  the Prospectus  (including each preliminary  prospectus) and
such other  documents or  information  as the Investor or counsel may reasonably
request in order to facilitate the disposition of the Registrable Securities.

                  (e) The Company shall deliver,  in accordance  with the notice
provisions of Section 4.8, to each seller of Registrable  Securities  covered by
the  Registration  Statement such number of conformed copies of the Registration
Statement and of each amendment and  supplement  thereto (in each case including
all exhibits and documents incorporated by reference),  such number of copies of
the  Prospectus   (including  each   preliminary   prospectus  and  any  summary
prospectus) and any other prospectus filed under Rule 424 promulgated  under the
Securities Act relating to such seller's Registrable Securities,  and such other
documents,  as such seller may reasonably  request to facilitate the disposition
of its Registrable Securities.

                  (f)  After  the  filing  of the  Registration  Statement,  the
Company  shall  promptly  notify  the  Investor  of any  stop  order  issued  or
threatened by the Commission in connection  therewith and take


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<PAGE>

all commercially  reasonable  actions required to prevent the entry of such stop
order or to remove it if entered.

                  (g) The Company shall use commercially  reasonable  efforts to
(i) register or qualify the Registrable  Securities  under such other securities
or blue sky laws of each  jurisdiction  in the United States as the Investor may
reasonably  (in light of its intended plan of  distribution)  request,  and (ii)
cause the Registrable Securities to be registered with or approved by such other
governmental agencies or authorities in the United States as may be necessary by
virtue of the  business and  operations  of the Company and do any and all other
customary  acts and things that may be  reasonably  necessary  or  advisable  to
enable the Investor to consummate the disposition of the Registrable Securities;
provided, however, that the Company will not be required to qualify generally to
do  business in any  jurisdiction  where it would not  otherwise  be required to
qualify  but for this  Section  2.1(g),  subject  itself to taxation in any such
jurisdiction,  consent  or subject  itself to general  service of process in any
such  jurisdiction,  change any existing  business  practices,  benefit plans or
outstanding securities or amend or otherwise modify the Charter or Bylaws.

                  (h) In the  event of an  underwritten  offering,  the  Company
shall  enter  into  customary  agreements  and take such  other  actions  as are
reasonably  required in order to expedite the  disposition  of such  Registrable
Securities.

                  (i) The Company shall make available to the Investor (and will
deliver to Investor's counsel),(A) subject to restrictions imposed by the United
States federal  government or any agency or instrumentality  thereof,  copies of
all public correspondence  between the Commission and the Company concerning the
Registration  Statement  and will  also make  available  for  inspection  by the
Investor and any  attorney,  accountant  or other  professional  retained by the
Investor  (collectively,  the  "Inspectors"),(B)  upon reasonable advance notice
during  normal  business  hours  all  financial  and  other  records,  pertinent
corporate documents and properties of the Company (collectively,  the "Records")
as shall be reasonably  necessary to enable them to exercise their due diligence
responsibility,  and cause the  Company's  officers and  employees to supply all
information  reasonably  requested  by any  Inspectors  in  connection  with the
Registration Statement;  provided,  however, that any such Inspectors must agree
in  writing  for the  benefit of the  Company  not to use or  disclose  any such
Records  except as provided in this  Section  2.1(i).  Records  that the Company
determines,  in  good  faith,  to be  confidential  and  that  it  notifies  the
Inspectors are confidential  shall not be disclosed by the Inspectors unless the
disclosure or release of such Records is requested or required  pursuant to oral
questions, interrogatories,  requests for information or documents or a subpoena
or other  order from a court of  competent  jurisdiction  or other  judicial  or
governmental process; provided, however, that prior to any disclosure or release
pursuant to the immediately  preceding clause,  the Inspectors shall provide the
Company  with  prompt  notice of any such  request  or  requirement  so that the
Company  may seek an  appropriate  protective  order or waive  such  Inspectors'
obligation not to disclose such Records; and, provided, further, that if failing
the entry of a  protective  order or the waiver by the  Company  permitting  the
disclosure or release of such Records,  the Inspectors,  upon advice of counsel,
are compelled to disclose such Records, the Inspectors may disclose that portion
of the Records that counsel has advised the  Inspectors  that the Inspectors are
compelled  to  disclose;   provided,   however,  that  upon  any  such  required
disclosure,  such  Inspector  shall  use  his  or her  best  efforts  to  obtain
reasonable  assurances  that  confidential   treatment  will  be  afforded  such
information.  The Investor  agrees that  information  obtained by it solely as a
result of such inspections (not including any information  obtained from a third
party who, insofar as is known to the Investor after reasonable  inquiry, is not
prohibited from providing such information by a contractual,  legal or fiduciary
obligation to the Company)  shall be deemed  confidential  and shall not be used
for any  purposes  other than as  indicated  above or by it as the basis for any
market  transactions  in the securities of the Company or its affiliates  unless
and until such  information  is made  generally  available  to the  public.  The
Investor  further  agrees that it will,  upon learning  that  disclosure of such
Records  is  sought in a court of  competent  jurisdiction,  give  notice to the


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<PAGE>

Company and allow the Company, at its expense,  to undertake  appropriate action
to prevent disclosure of the Records deemed confidential.

                  (j) In the event of an underwritten  (other than the Investor)
offering of the sale of  Registrable  Securities  pursuant  to the  Registration
Statement,  then  to the  extent  required  by  the  managing  underwriters  and
reasonably  necessary to effect a sale of  Registrable  Securities in accordance
with prevailing  business practices at the time of any such underwritten sale of
Registrable Securities pursuant to a Registration  Statement,  the Company shall
deliver to the Investor a signed counterpart,  addressed to the Investor, of (1)
an opinion or opinions of counsel to the  Company,  and (2) a comfort  letter or
comfort  letters from the  Company's  independent  public  accountants,  each in
customary  form and  covering  such matters of the type  customarily  covered by
opinions  or  comfort  letters,  as the case may be,  as the  Investor  therefor
reasonably requests.

                  (k) The Company  shall  otherwise  comply with all  applicable
rules  and  regulations  of  the  Commission,   including,  without  limitation,
compliance with applicable reporting requirements under the Exchange Act.

                  (l) The Company shall  appoint a transfer  agent and registrar
for all of the Registrable Securities covered by such Registration Statement not
later than the effective date of such Registration Statement.

                  (m)  The  Investor  shall  cooperate  with  the  Company,   as
reasonably  requested by the Company,  in connection  with the  preparation  and
filing of any  Registration  Statement  hereunder.  The  Company may require the
Investor to promptly  furnish in writing to the Company such  information as may
be required in connection with such registration including,  without limitation,
all such  information  as may be requested by the  Commission or the NASD or any
state securities commission and all such information regarding the Investor, the
Registrable  Securities  held  by  the  Investor  and  the  intended  method  of
disposition of the Registrable  Securities.  The Investor agrees to provide such
information  requested  in  connection  with such  registration  within five (5)
Business days after  receiving such written request and the Company shall not be
responsible for any delays in obtaining or maintaining the  effectiveness of the
Registration  Statement caused by the Investor's  failure to timely provide such
information.

                  (n) Upon receipt of a Blackout  Notice from the  Company,  the
Investor shall  immediately  discontinue  disposition of Registrable  Securities
pursuant to the  Registration  Statement  covering such  Registrable  Securities
until  (i) the  Company  advises  the  Investor  that the  Blackout  Period  has
terminated and (ii) the Investor  receives  copies of a supplemented  or amended
prospectus,  if  necessary.  If so directed by the Company,  the  Investor  will
deliver to the Company (at the expense of the  Company) or destroy  (and deliver
to the  Company a  certificate  of  destruction)  all  copies in the  Investor's
possession  (other  than a limited  number  of file  copies)  of the  prospectus
covering such  Registrable  Securities that is current at the time of receipt of
such notice.

                  (o) If the Investor  determines  to engage in an  Underwritten
Offering,  the  Investor  will enter into and perform its  obligations  under an
underwriting  agreement,  in  usual  and  customary  form,  including,   without
limitation,  customary  indemnification and contribution  obligations,  with the
managing  underwriter of such offering,  and will take such other actions as are
reasonably  required in order to expedite or facilitate  the  disposition of the
Registrable Securities. The Investor shall consult with the Company prior to any
Underwritten   Offering  and  shall  defer  such  Underwritten  Offering  for  a
reasonable period upon the commercially reasonable request of the Company.

Section  2.2.  REGISTRATION  EXPENSES.  The Company  shall pay all  registration
expenses   incurred  in  connection   with  the   Registration   Statement  (the
"Registration Expenses"),  including,  without limitation: (i) all registration,
filing,   securities   exchange  listing  and  fees  required  by  the  National


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<PAGE>

Association of Securities Dealers, (ii) all registration,  filing, qualification
and other fees and  expenses  of  compliance  with  securities  or blue sky laws
(including  reasonable fees and disbursements of counsel in connection with blue
sky  qualifications of the Registrable  Securities),  (iii) all word processing,
duplicating,  printing,  messenger  and delivery  expenses,  (iv) the  Company's
internal expenses (including,  without limitation,  all salaries and expenses of
its officers and employees  performing legal or accounting duties), (v) the fees
and  expenses  incurred  by the  Company in  connection  with the listing of the
Registrable  Securities,  (vi) reasonable fees and  disbursements of counsel for
the Company and customary  fees and expenses for  independent  certified  public
accountants  retained  by the  Company  (including  the  expenses of any special
audits or comfort  letters or costs  associated with the delivery by independent
certified  public  accountants  of such  special  audit(s) or comfort  letter(s)
requested pursuant to Section 2.1(k) hereof), (vii) the fees and expenses of any
special experts retained by the Company in connection with such registration and
amendments and supplements to the Registration Statement and Prospectus,  (viii)
all  reasonable  fees and  expenses  of counsel  for the  Investor to the extent
incurred in connection with the review,  and assistance in  preparation,  of the
Registration  Statement,  correspondence  with the Commission and amendments and
supplements to the  Registration  Statement and  Prospectus,  up to a maximum of
$2,500,  and (ix)  premiums  and other  costs of the  Company  for  policies  of
insurance  against  liabilities  arising  out  of  any  public  offering  of the
Registrable   Securities  being  registered.   Any  fees  and  disbursements  of
underwriters, broker-dealers or investment bankers, including without limitation
underwriting fees, discounts,  transfer taxes or commissions, and any other fees
or expenses (including legal fees and expenses) if any, attributable to the sale
of  Registrable  Securities,  shall be  payable  by each  holder of  Registrable
Securities pro rata on the basis of the number of Registrable Securities of each
such holder that are included in a registration under this Agreement.


                                   ARTICLE III
                                 INDEMNIFICATION

Section 3.1. INDEMNIFICATION.  The Company agrees to indemnify and hold harmless
the Investor, its partners, Affiliates,  officers, directors, employees and duly
authorized  agents, and each Person or entity, if any, who controls the Investor
within the  meaning of  Section  15 of the  Securities  Act or Section 20 of the
Exchange  Act,  together  with the partners,  Affiliates,  officers,  directors,
employees  and duly  authorized  agents  of such  controlling  Person  or entity
(collectively,  the "Controlling  Persons"),  from and against any loss,  claim,
damage, liability, costs and expenses (including, without limitation, reasonable
attorneys' fees and  disbursements  and costs and expenses of investigating  and
defending any such claim) (collectively,  "Damages"),  joint or several, and any
action or  proceeding in respect  thereof to which the  Investor,  its partners,
affiliates,  officers, directors,  employees and duly authorized agents, and any
Controlling Person, may become subject under the Securities Act or otherwise, as
incurred, insofar as such Damages (or actions or proceedings in respect thereof)
arise out of,  or are  based  upon,  any  untrue  statement  or  alleged  untrue
statement of a material fact contained in any Registration  Statement, or in any
preliminary  prospectus,  final  prospectus,  summary  prospectus,  amendment or
supplement relating to the Registrable Securities or arises out of, or are based
upon, any omission or alleged omission to state therein a material fact required
to be stated  therein or  necessary  to make the  statements  therein  under the
circumstances  not misleading,  and shall reimburse the Investor,  its partners,
affiliates,  officers, directors, employees and duly authorized agents, and each
such Controlling Person, for any legal and other expenses reasonably incurred by
the Investor, its partners, affiliates,  officers, directors, employees and duly
authorized agents, or any such Controlling Person, as incurred, in investigating
or  defending  or  preparing  to defend  against any such  Damages or actions or
proceedings;  provided,  however,  that the  Company  shall not be liable to the
extent  that  any  such  Damages  arise  out of the  Investor's  (or  any  other
indemnified  Person's) failure to send or give a copy of the final prospectus or
supplement (as then amended or supplemented) to the persons  asserting an untrue
statement  or alleged  untrue  statement  or omission or alleged  omission at or
prior to the written confirmation of the sale of Registrable  Securities to such
person if such  statement or omission was corrected in such final  prospectus or
supplement;  provided,


                                       7
<PAGE>

further,  that the  Company  shall  not be liable  to the  extent  that any such
Damages  arise out of or are based upon an untrue  statement  or alleged  untrue
statement or omission or alleged omission made in such  Registration  Statement,
or any  such  preliminary  prospectus,  final  prospectus,  summary  prospectus,
amendment  or  supplement  in  reliance  upon  and in  conformity  with  written
information  furnished  to the  Company by or on behalf of the  Investor  or any
other person who  participates as an underwriter in the offering or sale of such
securities,  in  either  case,  specifically  stating  that it is for use in the
preparation thereof. In connection with any Registration  Statement with respect
to which the Investor is  participating,  such Investor will  indemnify and hold
harmless,  to the  same  extent  and in the  same  manner  as set  forth  in the
preceding paragraph, the Company, each of its directors,  officers, each Person,
if any,  who  controls  the  Company  within  the  meaning  of Section 15 of the
Securities  Act or Section 20 of the Exchange  Act (each a "Company  Indemnified
Person") against any Damages to which any Company  Indemnified Person may become
subject under the Securities Act, the Exchange Act or otherwise, insofar as such
Damages  arise out of or are based  upon (a) any  untrue  statement  or  alleged
untrue statement of a material fact contained in any Registration  Statement, or
in any preliminary prospectus, final prospectus,  summary prospectus,  amendment
or  supplement  relating to the  Registrable  Securities or arise out of, or are
based upon,  any omission or alleged  omission to state  therein a material fact
required to be stated therein or necessary to make the statements  therein under
the  circumstances  not misleading to the extent that such  violation  occurs in
reliance  upon and in  conformity  with  written  information  furnished  to the
Company  by the  Investor  or on behalf  of the  Investor  expressly  for use in
connection with such  Registration  Statement or (b) any failure by the Investor
to comply with  prospectus  delivery  requirements  of the  Securities  Act, the
Exchange Act or any other law or legal requirement applicable to sales under the
Registration Statement

Section   3.2.   CONDUCT  OF   INDEMNIFICATION   PROCEEDINGS.   All  claims  for
indemnification  under  Section 3.1 shall be asserted and resolved in accordance
with the provisions of Section 10.02 and 10.03 of the Purchase Agreement.

Section  3.3.  ADDITIONAL  INDEMNIFICATION.   Indemnification  similar  to  that
specified  in the  preceding  paragraphs  of this  Article  3 (with  appropriate
modifications)  shall be given  by the  Company  with  respect  to any  required
registration or other qualification of securities under any federal or state law
or regulation of any  governmental  authority other than the Securities Act. The
provisions  of this  Article  III shall be in  addition  to any other  rights to
indemnification,  contribution or other remedies which an Indemnified Party or a
Company  Indemnified  Person  may have  pursuant  to law,  equity,  contract  or
otherwise.

To the extent that any  indemnification  provided  for herein is  prohibited  or
limited by law, the indemnifying  party will make the maximum  contribution with
respect to any amounts for which it would otherwise be liable under this Article
III to the fullest extent permitted by law. However, (a) no contribution will be
make under  circumstances  where maker of such contribution  would not have been
required to indemnify the indemnified  party under the fault standards set forth
in  this  Article  III,  (b) no  seller  of  Registrable  Securities  guilty  of
fraudulent  misrepresentation  (within  the  meaning  of  Section  11(f)  of the
Securities  Act) will be  entitled  to  contribution  from any Person who is not
guilty of such fraudulent misrepresentation, and (c) contribution (together with
any  indemnification   obligations  under  this  Agreement)  by  any  seller  of
Registrable  Securities  will be limited in amount of proceeds  received by such
seller from the sale of such Registrable Securities.


                                       8
<PAGE>

                                   ARTICLE IV
                                  MISCELLANEOUS

Section 4.1. NO OUTSTANDING  REGISTRATION RIGHTS.  Except as otherwise disclosed
in accordance with the Purchase  Agreement or in the Commission  Documents,  the
Company  represents  and warrants to the Investor that there is not in effect on
the date hereof any  agreement  by the Company  pursuant to which any holders of
securities  of the  Company  have a right to cause the  Company to  register  or
qualify such  securities  under the Securities Act or any securities or blue sky
laws of any jurisdiction.

Section  4.2.  TERM.  The  registration   rights  provided  to  the  holders  of
Registrable  Securities  hereunder,  and the  Company's  obligation  to keep the
Registration  Statement  effective,  shall  terminate at the earlier of (i) such
time that is two years following the termination of the Purchase Agreement, (ii)
such time as all  Registrable  Securities have been issued and have ceased to be
Registrable Securities, or (iii) upon the consummation of an "Excluded Merger or
Sale" as defined  in the  Purchase  Agreement.  Notwithstanding  the  foregoing,
paragraphs (c) and (d) of Section 1.1, Article III, Section 4.8, and Section 4.9
shall survive the termination of this Agreement.

Section 4.3.  RULE 144. The Company  will,  at its expense,  promptly  take such
action as holders of Registrable  Securities  may  reasonably  request to enable
such holders of Registrable  Securities to sell Registrable  Securities  without
registration  under the  Securities  Act within the limitation of the exemptions
provided by (a) Rule 144 under the Securities Act ("Rule 144"), as such Rule may
be amended from time to time,  or (b) any similar rule or  regulation  hereafter
adopted by the  Commission.  If at any time the Company is not  required to file
such reports, it will, at its expense, forthwith upon the written request of any
holder  of  Registrable  Securities,  make  available  adequate  current  public
information  with respect to the Company within the meaning of paragraph  (c)(2)
of Rule 144 or such other  information  as necessary to permit sales pursuant to
Rule 144.  Upon the request of the  Investor,  the Company  will  deliver to the
Investor  a written  statement,  signed  by the  Company's  principal  financial
officer, as to whether it has complied with such requirements.

Section 4.4. CERTIFICATE.  The Company will, at its expense,  forthwith upon the
request  of any  holder of  Registrable  Securities,  deliver  to such  holder a
certificate,  signed by the Company's principal  financial officer,  stating (a)
the Company's name,  address and telephone number (including area code), (b) the
Company's  Internal  Revenue Service  identification  number,  (c) the Company's
Commission  file  number,  (d) the  number  of  shares  of each  class  of Stock
outstanding  as shown by the most recent  report or  statement  published by the
Company,  and (e) whether the Company has filed the reports required to be filed
under the  Exchange  Act for a period of at least  ninety (90) days prior to the
date of such certificate and in addition has filed the most recent annual report
required to be filed thereunder.

Section 4.5. AMENDMENT AND MODIFICATION.  Any provision of this Agreement may be
waived,  provided  that such  waiver is set forth in a writing  executed by both
parties to this  Agreement.  The  provisions  of this  Agreement,  including the
provisions of this sentence, may not be amended,  modified or supplemented,  and
waivers or consents to departures  from the provisions  hereof may not be given,
unless the Company has obtained the written consent of the holders of a majority
of the then outstanding Registrable  Securities.  Notwithstanding the foregoing,
the  waiver of any  provision  hereof  with  respect  to a matter  that  relates
exclusively to the rights of holders of Registrable  Securities whose securities
are being sold  pursuant to a  Registration  Statement  and does not directly or
indirectly  affect the rights of other holders of Registrable  Securities may be
given by holders of at least a majority of the Registrable Securities being sold
by such  holders;  provided  that the  provisions  of this  sentence  may not be
amended,  modified or  supplemented  except in accordance with the provisions of
the immediately  preceding  sentence.  No course of dealing between or among any
Person having any interest in this Agreement will be deemed effective to modify,
amend or discharge any part of this  Agreement or any rights or  obligations  of
any person under or by reason of this Agreement.


                                       9
<PAGE>

Section 4.6. SUCCESSORS AND ASSIGNS; ENTIRE AGREEMENT. This Agreement and all of
the  provisions  hereof  shall be binding  upon and inure to the  benefit of the
parties hereto and their  respective  successors  and assigns.  The Investor may
assign  its  rights  under  this  Agreement  to  any  subsequent  holder  of the
Registrable  Securities  (unless  sold  pursuant  to an  effective  registration
statement or in accordance  with Rule 144 under the  Securities  Act),  provided
that the  Company  shall  have the right to require  any  holder of  Registrable
Securities  to execute a  counterpart  of this  Agreement as a condition to such
holder's claim to any rights hereunder. The Company may assign this Agreement at
any time in connection  with a sale or  acquisition  of the Company,  whether by
merger, consolidation, sale of all or substantially all of the Company's assets,
or similar transaction,  without the consent of the Investor or other holders of
Registrable  Securities,  provided  that the  successor or  acquiring  Person or
entity agrees in writing to assume all of the Company's  rights and  obligations
under this Agreement.  This Agreement,  together with the Purchase Agreement and
the Warrant(s)  sets forth the entire  agreement and  understanding  between the
parties as to the  subject  matter  hereof and merges and  supersedes  all prior
discussions, agreements and understandings of any and every nature among them.

Section 4.7.  SEVERABILITY.  In the event that any  provision of this  Agreement
becomes or is  declared  by a court of  competent  jurisdiction  to be  illegal,
unenforceable  or void,  this Agreement  shall continue in full force and effect
without said provision;  provided that such severability shall be ineffective if
it  materially  changes  the  economic  benefit of this  Agreement  to any party
hereto.

Section 4.8. NOTICES. All notices, demands, requests,  consents,  approvals, and
other  communications   required  or  permitted  hereunder  shall  be  given  in
accordance with Section 10.04 of the Purchase Agreement.

Section  4.9.  GOVERNING  LAW;  DISPUTE  RESOLUTION.  This  Agreement  shall  be
construed under the laws of the State of New York. Any dispute arising out of or
relating to this Agreement shall be resolved by means of arbitration pursuant to
the provisions of Article X of the Purchase Agreement.

Section 4.10.  HEADINGS.  The headings in this Agreement are for  convenience of
reference only and shall not constitute a part of this Agreement, nor shall they
affect their meaning, construction or effect.

Section  4.11.  COUNTERPARTS.   This  Agreement  may  be  executed  in  multiple
counterparts, each of which shall be deemed to be an original instrument and all
of which together shall constitute one and the same instrument.

Section  4.12.  FURTHER  ASSURANCES.  Each party shall  cooperate  and take such
action as may be reasonably requested by another party in order to carry out the
provisions  and purposes of this  Agreement  and the  transactions  contemplated
hereby.

Section 4.13. ABSENCE OF PRESUMPTION.  This Agreement shall be construed without
regard to any  presumption  or rule  requiring  construction  or  interpretation
against the party drafting or causing any instrument to be drafted.


                                       10
<PAGE>

         IN WITNESS  WHEREOF,  the parties hereto have caused this  Registration
Rights Agreement to be executed by the  undersigned,  thereunto duly authorized,
as of the date first set forth above.



                                                  CELLEGY PHARMACEUTICALS, INC.


                                                  By:
                                                     ---------------------------
                                                     Name:
                                                    Title:



                                                  KINGSBRIDGE CAPITAL LIMITED


                                                  By:
                                                     ---------------------------
                                                     Name:  Valentine O'Donoghue
                                                     Title:  Director