<PAGE>
                                                                   Exhibit 10.12


                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT ("Agreement") is entered into as of this 25th
day of August, 2003 (the "Effective Date"), by and between Paul Chaney
("Executive") and Eyetech Pharmaceuticals, Inc., a Delaware corporation (the
"Company").

         WHEREAS, the Company desires to employ Executive to provide personal
services to the Company, and wishes to provide Executive with certain
compensation and benefits in return for such services; and

         WHEREAS, Executive wishes to be employed by the Company and provide
personal services to the Company in return for certain compensation and
benefits.

         NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, it is hereby agreed by and between the parties hereto as
follows:

1.       Employment By The Company.

         1.1      The Company agrees to employ Executive in the position of
                  Chief Operating Officer of the Company. During Executive's
                  employment with the Company, Executive will devote his best
                  efforts and substantially all of his business time and
                  attention to the business of the Company.

         1.2      Executive shall serve in an executive capacity and shall
                  perform such duties as are customarily associated with his
                  then current title, consistent with the Bylaws of the Company
                  and as required by the Company's Board of Directors (the
                  "Board") or the Company's Chief Executive Officer.

         1.3      The employment relationship between the parties shall also be
                  governed by the general employment policies and practices of
                  the Company, including those relating to protection of
                  confidential information and assignment of inventions, except
                  that when the terms of this Agreement differ from or are in
                  conflict with the Company's general employment policies or
                  practices, this Agreement shall control.

         1.4      The Company and Executive each acknowledge that either party
                  has the right to terminate Executive's employment with the
                  Company at any time for any reason whatsoever, with or without
                  Cause or advance notice. This at-will employment relationship
                  cannot be changed except in a writing signed by both Executive
                  and the Chief Executive Officer.

2.       Compensation.

         2.1      Salary. Executive shall receive, for services to be rendered
                  under this Agreement, a base salary ("Base Salary") at the
                  annualized rate of $275,000.00, less applicable federal and
                  state withholdings. Such Base Salary shall commence as of the
                  Effective Date, and shall be payable in installments
                  consistent with the Company's regular payroll practices.
                  Executive's Base Salary shall be reviewed
<PAGE>
                  at least annually by the Board, and in the Board's sole
                  discretion, may be adjusted at any time upon thirty (30) days
                  written notice to the Executive.

         2.2      Termination.

                  (a)      In the event Executive's employment terminates as a
                           result of a voluntary termination by Executive for
                           Good Reason, or a termination by the Company without
                           Cause, upon execution of an effective general release
                           of all claims against the Company, its employees,
                           officers, directors and agents, in a form reasonably
                           acceptable to the Company: (i) Executive shall
                           receive twelve (12) monthly payments each equal in
                           amount to one-twelfth (1/12th) of Executive's then
                           Base Salary, less applicable state and federal
                           withholdings; and (ii) for a period of twelve (12)
                           months (or until comparable benefits coverage becomes
                           available to Executive, if sooner), the Company shall
                           reimburse Executive (or pay him directly, at the
                           Company's option) the costs associated with the
                           continuation of Executive's and his dependents'
                           medical and dental benefits under the Consolidated
                           Omnibus Budget Reconciliation Act of 1985, as amended
                           ("COBRA") as in effect immediately prior to
                           Executive's termination of employment. In addition,
                           in the event Executive's employment is terminated by
                           the Company without Cause within the first twelve
                           (12) months following the Effective Date, and after
                           signing the release described above, any stock option
                           he receives from the Company at the commencement of
                           employment shall become pro rata vested at the rate
                           of 1/48th of such option for each completed month of
                           service the Executive has provided to the Company.

                  (b)      For purposes of this Agreement, "Good Reason" means
                           that any of the following are undertaken without
                           Executive's express written consent: (i) the
                           assignment to Executive of any duties or
                           responsibilities which result in any material
                           diminution or adverse change of Executive's position,
                           status or circumstances of employment; (ii) the
                           taking of any action by the Company which would
                           adversely affect Executive's participation in, or
                           reduce Executive's benefits under, the Company's
                           benefit plans (including equity benefits) as of the
                           time this Agreement is executed, except to the extent
                           the benefits of all other executive officers of the
                           Company are similarly reduced; (iii) a relocation of
                           Executive's principal office to a location more than
                           thirty-five (35) miles from Manhattan, New York,
                           except for required travel by Executive on the
                           Company's business; or (iv) any failure by the
                           Company to obtain the assumption of this Agreement by
                           any successor or assign of the Company. For purposes
                           of this Agreement, "Cause" means: (V) an intentional
                           action or intentional failure to act by Executive
                           which was performed in bad faith and to the material
                           detriment of the Company; (W) Executive intentionally
                           refuses or intentionally fails to act in accordance
                           with any lawful and proper direction or order of the
                           Board; (X) Executive willfully and habitually
                           neglects the duties of his employment; (Y) Executive
                           violates Sections 3, 4 or 5 of this Agreement;

                                       2
<PAGE>
                           or (Z) Executive is convicted of a felony crime
                           involving moral turpitude; provided, however, that in
                           the event that any of the foregoing events under
                           clauses (V), (W), (X) or (Y) above is capable of
                           being cured, the Company shall provide written notice
                           to Executive describing the nature of such event and
                           Executive shall thereafter have ten (10) business
                           days to cure such event.

                  (c)      In the event Executive's employment terminates as a
                           result of termination of Executive by the Company or
                           its successor without Cause, or by the Executive
                           voluntarily for Good Reason, within the three (3)
                           months before or twelve (12) months following a
                           Change in Control Event, upon execution of an
                           effective general release of all claims against the
                           Company, its employees, officers, directors and
                           agents, in a form reasonably acceptable to the
                           Company: (i) Executive shall receive, within fifteen
                           (15) days of such termination, one lump sum payment
                           equivalent to fifteen (15) months of his then Base
                           Salary, less applicable state and federal
                           withholdings; (ii) Executive's unvested equity rights
                           shall become vested and exercisable as set forth in
                           Section 2.3(b); and (iii) for a period of fifteen
                           (15) months (or until comparable benefits coverage
                           becomes available to Executive, if sooner), the
                           Company shall reimburse Executive (or pay him
                           directly at the Company's option) the costs
                           associated with the continuation of Executive's and
                           his dependents' medical and dental benefits under
                           COBRA as in effect immediately prior to Executive's
                           termination of employment. For purposes of this
                           paragraph, Executive's "Base Salary" shall be the
                           greater of the amount in effect either immediately
                           prior to the Change in Control Event or the
                           termination date of Executive's employment. The
                           benefits provided under this Section 2.2(c) shall be
                           in lieu of any benefits the Executive would have
                           otherwise been entitled to pursuant to Section 2.2(a)
                           of this Agreement.

                  (d)      For purposes of this Agreement, a "Change in Control
                           Event" shall mean:

                           (i)      The acquisition by an individual, entity or
                                    group (within the meaning of Section
                                    13(d)(3) or 14(d)(2) of the Exchange Act) (a
                                    "Person") of beneficial ownership of any
                                    capital stock of the Company if, after such
                                    acquisition, such Person beneficially owns
                                    (within the meaning of Rule 13d-3
                                    promulgated under the Exchange Act) 50% or
                                    more of either (x) the then-outstanding
                                    shares of common stock of the Company (the
                                    "Outstanding Company Common Stock") or (y)
                                    the combined voting power of the
                                    then-outstanding securities of the Company
                                    entitled to vote generally in the election
                                    of directors (the "Outstanding Company
                                    Voting Securities"); provided, however, that
                                    for purposes of this subsection (i), the
                                    following acquisitions shall not constitute
                                    a Change in Control Event: (A) any
                                    acquisition directly from the Company
                                    (excluding an acquisition pursuant to the
                                    exercise, conversion or exchange of any
                                    security exercisable for, convertible

                                       3
<PAGE>
                                    into or exchangeable for common stock or
                                    voting securities of the Company, unless the
                                    Person exercising, converting or exchanging
                                    such security acquired such security
                                    directly from the Company or an underwriter
                                    or agent of the Company), (B) any
                                    acquisition by any employee benefit plan (or
                                    related trust) sponsored or maintained by
                                    the Company or any corporation controlled by
                                    the Company, or (C) any acquisition by any
                                    corporation pursuant to a Business
                                    Combination (as defined below) which
                                    complies with clauses (x) and (y) of
                                    subsection (iii) of this definition; or

                           (ii)     Such time as the Continuing Directors (as
                                    defined below) do not constitute a majority
                                    of the Board (or, if applicable, the Board
                                    of Directors of a successor corporation to
                                    the Company), where the term "Continuing
                                    Director" means at any date a member of the
                                    Board (x) who was a member of the Board on
                                    the date of the initial adoption of this
                                    Agreement by the Board or (y) who was
                                    nominated or elected subsequent to such date
                                    by at least a majority of the directors who
                                    were Continuing Directors at the time of
                                    such nomination or election or whose
                                    election to the Board was recommended or
                                    endorsed by at least a majority of the
                                    directors who were Continuing Directors at
                                    the time of such nomination or election; or

                           (iii)    The consummation of a merger, consolidation,
                                    reorganization, recapitalization or share
                                    exchange involving the Company or a sale or
                                    other disposition of all or substantially
                                    all of the assets of the Company (a
                                    "Business Combination"), unless, immediately
                                    following such Business Combination, each of
                                    the following two conditions is satisfied:
                                    (x) all or substantially all of the
                                    individuals and entities who were the
                                    beneficial owners of the Outstanding Company
                                    Common Stock and Outstanding Company Voting
                                    Securities immediately prior to such
                                    Business Combination beneficially own,
                                    directly or indirectly, more than 50% of the
                                    then-outstanding shares of common stock and
                                    the combined voting power of the
                                    then-outstanding securities entitled to vote
                                    generally in the election of directors,
                                    respectively, of the resulting or acquiring
                                    corporation or other form of entity in such
                                    Business Combination (which shall include,
                                    without limitation, a corporation which as a
                                    result of such transaction owns the Company
                                    or substantially all of the Company's assets
                                    either directly or through one or more
                                    subsidiaries) (such resulting or acquiring
                                    corporation or entity is referred to herein
                                    as the "Acquiring Corporation") in
                                    substantially the same proportions as their
                                    ownership of the Outstanding Company Common
                                    Stock and Outstanding Company Voting
                                    Securities, respectively, immediately prior
                                    to such Business Combination and (y) no
                                    Person (excluding the Acquiring Corporation
                                    or any employee benefit

                                       4
<PAGE>
                                    plan (or related trust) maintained or
                                    sponsored by the Company or by the Acquiring
                                    Corporation) beneficially owns, directly or
                                    indirectly, 30% or more of the
                                    then-outstanding shares of common stock of
                                    the Acquiring Corporation, or of the
                                    combined voting power of the
                                    then-outstanding securities of such
                                    corporation entitled to vote generally in
                                    the election of directors (except to the
                                    extent that such ownership existed prior to
                                    the Business Combination).

                           (iv)     Notwithstanding the foregoing, a Change in
                                    Control Event will not be deemed to have
                                    occurred in the case of a Management Buy
                                    Out. A "Management Buy Out" is any event
                                    which would otherwise be deemed a "Change in
                                    Control Event", in which the Executive,
                                    directly or indirectly (as a beneficial
                                    owner) acquires equity securities, including
                                    any securities convertible into or
                                    exchangeable for equity securities, of the
                                    Company or the Acquiring Corporation in
                                    connection with any Change in Control Event.

         2.3      Treatment of Equity Upon Change in Control Event. Upon a
                  Change in Control Event, as defined in Section 2.2(d):

                  (a)      50% of all of the Executive's unvested equity rights
                           shall become vested and immediately exercisable; and

                  (b)      If Executive's employment terminates as a result of
                           the circumstances outlined in Section 2.2(c), and
                           provided that Executive executes an effective general
                           release as required by Section 2.2(c), 100% of the
                           Executive's unvested equity rights shall then become
                           vested and immediately exercisable.

         2.4      Golden Parachute Taxes. Notwithstanding anything contained in
                  this Agreement to the contrary, to the extent that payments
                  and benefits provided under this Agreement to Executive and
                  benefits provided to, or for the benefit of, Executive under
                  any other Company plan or agreement (such payments or benefits
                  are collectively referred to as the "Payments") would be
                  subject to the excise tax (the "Excise Tax") imposed under
                  Section 4999 of the Internal Revenue Code of 1986, as amended
                  (the "Code"), the Payments shall be reduced (but not below
                  zero) to the extent necessary so that no Payment to be made or
                  benefit to be provided to the Executive shall be subject to
                  the Excise Tax, but only if, by reason of such reduction, the
                  net after-tax benefit received by Executive shall exceed the
                  net after-tax benefit received by him if no such reduction was
                  made. For purposes of this Section 2.4, "net after-tax
                  benefit" shall mean (a) the Payments which Executive receives
                  or is then entitled to receive from the Company that would
                  constitute "parachute payments" within the meaning of Section
                  280G of the Code, less (b) the amount of all federal, state
                  and local income taxes payable with respect to the foregoing
                  calculated at the maximum

                                       5
<PAGE>
                  marginal income tax rate for each year in which the foregoing
                  shall be paid Executive (based on the rate in effect for such
                  year as set forth in the Code as in effect at the time of the
                  first payment of the foregoing) less (c) the amount of excise
                  taxes imposed with respect to the payments and benefits
                  described in (a) above by Section 4999 of the Code. The
                  foregoing determination will be made by a nationally
                  recognized accounting firm (the "Accounting Firm") selected by
                  the Company (which may be, but will not be required to be, the
                  Company's independent auditors). The Company will direct the
                  Accounting Firm to submit its determination and detailed
                  supporting calculations to both the Executive and the Company
                  within fifteen (15) days after the date of termination of his
                  employment. If the Accounting Firm determines that such
                  reduction is required by this Section 2.4, the Executive, in
                  his sole and absolute discretion, may determine which Payments
                  shall be reduced to the extent necessary so that no portion
                  thereof shall be subject to the excise tax imposed by Section
                  4999 of the Code, and the Company shall pay such reduced
                  amount to him. The fees and expenses of the Accounting Firm
                  for its services in connection with the determinations and
                  calculations contemplated by this Section 2.4 will be borne by
                  the Company.

         2.5      Discretionary Incentive Compensation. Executive will be
                  eligible to participate in any discretionary incentive
                  compensation programs that the Company establishes and makes
                  available to executives, in its sole discretion, from time to
                  time. Executive's discretionary compensation will range from 0
                  to 35% of his then current annual base salary. As this is
                  discretionary, any failure by the Board to provide
                  compensation under this section shall not give rise to any
                  claim by the Executive for unpaid compensation.

         2.6      Medical and Dental Coverage. The Company shall provide
                  Executive with medical and dental coverage which is no less
                  favorable than that provided to any other executive of the
                  Company.

         2.7      Standard Company Benefits. Executive shall be entitled to
                  participate in any benefit programs which may be in effect
                  from time to time and provided by the Company to its employees
                  generally and/or to its management and executive employees in
                  particular, provided that Executive is eligible to participate
                  under the terms and conditions of any such benefits plans.

         2.8      Expenses. Executive shall be entitled to receive prompt
                  reimbursement of all reasonable and necessary business
                  expenses incurred by Executive in performing Company services,
                  provided that Executive furnishes the Company with adequate
                  records and other documentary evidence of such expenses for
                  which Executive seeks reimbursement. Such expenses shall be
                  accounted for under the policies and procedures established by
                  the Company.

         2.9      Automobile Allowance. The Executive shall receive an
                  all-inclusive monthly automobile allowance of $900. The
                  Executive shall be solely responsible for

                                       6
<PAGE>
                  costs and fees related to any automobile purchased or leased
                  with such allowance, including, but not limited to, insurance,
                  maintenance, and mileage.

         2.10     Vacation and Sick Leave. Executive shall be eligible for
                  vacation and sick leave in accordance with policies as
                  periodically established by the Company for Company officers.

3.       Confidential Information Obligations and Conflicts.

         3.1      Executive agrees that all information and know-how, whether or
                  not in writing, of a private, secret or confidential nature
                  concerning the Company's business or financial affairs
                  (collectively, "Proprietary Information") is and shall be the
                  exclusive property of the Company. By way of illustration, but
                  not limitation, Proprietary Information may include
                  inventions, products, processes, methods, techniques,
                  formulas, compositions, compounds, projects, developments,
                  plans, research data, clinical data, financial data, personnel
                  data, computer programs, and customer and supplier lists.
                  Executive will not disclose any Proprietary Information to
                  others outside the Company or use the same for any
                  unauthorized purposes without written approval by an officer
                  of the Company, either during or after his employment, unless
                  and until such Proprietary Information has become public
                  knowledge without fault by the Executive.

         3.2      Executive agrees that all files, letters, memoranda, reports,
                  records, data, sketches, drawings, laboratory notebooks,
                  program listings, or other written, photographic, or other
                  tangible material containing Proprietary Information, whether
                  created by the Executive or others, which shall come into his
                  custody or possession, shall be and are the exclusive property
                  of the Company to be used by the Executive only in the
                  performance of his duties for the Company.

         3.3      Executive agrees that his obligation not to disclose or use
                  information, know-how and records of the types set forth in
                  paragraphs 3.1 and 3.2 above, also extends to such types of
                  information, know-how, records and tangible property of
                  customers of the Company or suppliers to the Company or other
                  third parties who may have disclosed or entrusted the same to
                  the Company or to the Executive in the course of the Company's
                  business.

         3.4      During Executive's employment, Executive agrees not to
                  acquire, assume, or participate in (directly or indirectly)
                  any position, investment or interest known by him to be
                  adverse or antagonistic to the Company, its business, or its
                  prospects, financial or otherwise or which may otherwise
                  create a conflict in Executive's interests. Nothing in this
                  paragraph shall bar Executive from owning securities of any
                  competitor corporation as a passive investor after the
                  termination of his employment, so long as his aggregate direct
                  holdings in any one such corporation shall not constitute more
                  than one percent (1%) of the voting stock of that corporation.

                                       7
<PAGE>
4.       Developments.

         4.1      Executive will make full and prompt disclosure to the Company
                  of all inventions, improvements, discoveries, methods,
                  developments, software, and works of authorship, whether
                  patentable or not, which are created, made, conceived or
                  reduced to practice by the Executive or under his direction or
                  jointly with others during his employment by the Company,
                  whether or not during normal working hours or on the premises
                  of the Company (all of which are collectively referred to in
                  this Agreement as "Developments").

         4.2      Executive agrees to assign and does hereby assign to the
                  Company (or any person or entity designated by the Company)
                  all his right, title and interest in and to all Developments
                  and all related patents, patent applications, copyrights and
                  copyright applications. However, this Section 4.2 shall not
                  apply to Developments which do not relate to the present or
                  planned business or research and development of the Company
                  and which are made and conceived by the Executive not during
                  normal working hours, not on the Company's premises and not
                  using the Company's tools, devices, equipment or Proprietary
                  Information.

         4.3      Executive agrees to cooperate fully with the Company, both
                  during and after his employment with the Company, with respect
                  to the procurement, maintenance and enforcement of copyrights,
                  patents and all other legal rights (both in the United States
                  and foreign countries) relating to Developments. Executive
                  shall sign all papers, including, without limitation,
                  copyright applications, patent applications, declarations,
                  oaths, formal assignments, assignment of priority rights, and
                  powers of attorney, which the Company may deem necessary or
                  desirable in order to protect its rights and interests in any
                  Development.

5.       General Provisions.

         5.1      Other Agreements. Executive hereby represents that he is not
                  bound by the terms of any agreement with any previous employer
                  or other party to refrain from using or disclosing any trade
                  secret or confidential or proprietary information in the
                  course of his employment with the Company or to refrain from
                  competing, directly or indirectly, with the business of such
                  previous employer or any other party. Executive further
                  represents that his performance of all the terms of this
                  Agreement and as an employee of the Company does not and will
                  not breach any agreement to keep in confidence proprietary
                  information, knowledge or data acquired by him in confidence
                  or in trust prior to his employment with the Company.

         5.2      Notices. Any notices provided hereunder must be in writing and
                  shall be deemed effective upon the earlier of (i) personal
                  delivery (including delivery by overnight courier) or (ii) the
                  third day after mailing by first-class mail, to the Company at
                  its primary office location and to Executive at his address as
                  then listed in the Company's payroll records.

                                       8
<PAGE>
         5.3      Severability. Whenever possible, each provision of this
                  Agreement will 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 invalid, illegal, or
                  unenforceable in any respect under any applicable law or rule
                  in any jurisdiction, such invalidity, illegality, or
                  unenforceability will not affect any other provision or any
                  other jurisdiction, but this Agreement will be reformed and
                  construed in such jurisdiction so as to render it enforceable
                  under applicable law insofar as possible consistent with the
                  intent of the parties.

         5.4      Waiver. If either party should waive any breach of any
                  provisions of this Agreement, that party shall not thereby be
                  deemed to have waived any preceding or succeeding breach of
                  the same or any other provision of this Agreement.

         5.5      Complete Agreement. This Agreement constitutes the entire
                  agreement between Executive and the Company and it is the
                  complete, final, and exclusive embodiment of their agreement
                  with regard to this subject matter and supersedes all prior
                  agreements and understandings between the parties. It is
                  entered into without reliance on any promise or representation
                  other than those expressly contained herein, and it cannot be
                  modified or amended except in a writing signed by both the
                  Executive and a duly authorized signatory of the Company.

         5.6      Counterparts. This Agreement may be executed in separate
                  counterparts, any one of which need not contain signatures of
                  more than one party, but all of which taken together will
                  constitute one and the same Agreement.

         5.7      Headings. The headings of the sections hereof are inserted for
                  convenience only and shall not be deemed to constitute a part
                  hereof nor to affect the meaning thereof.

         5.8      Successors and Assigns. This Agreement is intended to bind and
                  inure to the benefit of and be enforceable by Executive and
                  the Company, and their respective successors, assigns, heirs,
                  executors and administrators, except that Executive may not
                  assign any duties hereunder and may not assign any rights
                  hereunder without the written consent of the Company, which
                  shall not be withheld unreasonably.

         5.9      Choice of Law. All questions concerning the construction,
                  validity and interpretation of this Agreement will be governed
                  by the law of the State of New York, without regard to such
                  state's conflict-of-laws rules.

         5.10     Non-Publication. To the extent permitted by law, the parties
                  mutually agree not to disclose publicly the terms of this
                  Agreement except to the extent that disclosure is mandated by
                  applicable law or such disclosure is to the parties'
                  respective attorneys, accountants other advisors, and
                  immediate family.

         5.11     Agreement Controls. In the event of a conflict between the
                  text of this Agreement and any summary, description or other
                  information regarding this Agreement, the text of this
                  Agreement shall control.

                                       9
<PAGE>
         5.12     Tax Withholding. All payments made pursuant to this Agreement
                  shall be subject to all applicable federal, state and local
                  income and employment tax withholding.

         5.13     No Duty to Seek Employment. Executive and the Company
                  acknowledge and agree that nothing contained in this Agreement
                  shall be construed as requiring Executive to seek or accept
                  alternative or replacement employment in the event of his
                  termination of employment by the Company for any reason, and
                  no payment or benefit payable hereunder shall be conditioned
                  on Executive's seeking or accepting such alternative or
                  replacement employment.

         IN WITNESS WHEREOF, the parties have executed this Agreement on the day
and year first above written.

                                   EYETECH PHARMACEUTICALS, INC.


                                   By: /s/ DOUGLAS H. ALTSCHULER
                                      -----------------------------------------
                                   Name:  DOUGLAS H. ALTSCHULER
                                   Title: Senior Vice-President/General Counsel

                                   /s/ PAUL CHANEY                      8/25/03
                                   ---------------------------------
                                   PAUL CHANEY



                                       10