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                                                                   Exhibit 10.42

                     AMENDED AND RESTATED SECURITY AGREEMENT

     AMENDED AND RESTATED SECURITY AGREEMENT (this "Agreement"), dated as of
January 31, 2003, by and among Antares Pharma, Inc., a Minnesota corporation
("Company"), and the secured parties signatory hereto and their respective
endorsees, transferees and assigns (collectively, the "Secured Party"), amending
and restating the Security Agreement dated as of July 12, 2002 by and among the
Company, the Secured Party and the other parties named therein (the "Original
Security Agreement").

                              W I T N E S S E T H:

     WHEREAS, pursuant to a Securities Purchase Agreement, dated as of July 12,
2002 between the Company, the Secured Party and AJW Partners, LLC, AJW/New
Millennium Offshore, Ltd., Pegasus Capital Partners, LLC and OTATO Limited
Partnership (the "Former Secured Parties"), the Secured Party and the Former
Secured Parties purchased the Company's 10% Secured Convertible Debentures (the
"Old Debentures");

     WHEREAS, the Company has issued Promissory Notes (the "Xmark Fund, Ltd.
Promissory Notes") to Xmark Fund, Ltd. in the aggregate principal amount of Four
Hundred Fifty-seven Thousand Seven Hundred Fifty-seven and 47/100 Dollars
($457,757.47) and Promissory Notes (the "Xmark Fund, L.P. Promissory Notes" and
together with the Xmark Fund, Ltd. Promissory Notes, the "Promissory Notes") to
Xmark Fund, L.P. in the aggregate principal amount of One Hundred Sixty-three
Thousand Two Hundred Sixty-seven and 45/100 Dollars ($163,267.45), the proceeds
of which were used by the Company to repurchase the Old Debentures from the
Former Secured Parties; and

     WHEREAS, in connection with the repurchase of the Old Debentures from the
Former Secured Parties, each of the Former Secured Parties entered into
Debenture Repurchase Agreements, dated January 24, 2003 and January 31, 2003
(the "Debenture Repurchase Agreements"), pursuant to which the Former Secured
Parties released the Company from all Claims (as defined in the Debenture
Repurchase Agreements), including any claims under the Original Security
Agreement, and as a result, are no longer parties to the Original Security
Agreement; and

     WHEREAS, pursuant to the terms of the Debenture and Warrant Purchase
Agreement dated as of January 31, 2003 among the Company, Xmark Fund, Ltd, and
Xmark Fund, L.P. (the "New Purchase Agreement"), Xmark Fund Ltd. and Xmark Fund,
L.P. have agreed to cancel the Promissory Notes in exchange for the Company's
issuance, upon the terms and conditions stated in the New Purchase Agreement, of
(i) the Company's 8% Senior Secured Convertible Debentures (the "Debentures"),
having an aggregate principal amount equal to the outstanding principal and
accrued but unpaid interest on the Promissory Notes and (ii) warrants to
purchase an aggregate of One Million Five Hundred Thousand (1,500,000) shares of
the Company's common stock, par value $.01 per share (the "Common Stock"); and

     WHEREAS, pursuant to the terms of a separate Debenture and Warrant Purchase
Agreement dated as of January 31, 2003, among the Company and the Secured Party
(this

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separate Debenture and Warrant Purchase Agreement, together with the New
Purchase Agreement, referred to as the "Purchase Agreements"), the Company and
the Secured Party desire to cancel the Old Debentures held by the Secured Party
in exchange for the Company's issuance, upon the terms and conditions stated in
this Agreement, of (i) the Debentures and (ii) warrants to purchase an aggregate
of 1,432,500 shares of the Company's Common Stock; and

     WHEREAS, in order to induce the Secured Party to purchase the Debentures,
the Company has agreed to execute and deliver to the Secured Party this
Agreement for the benefit of the Secured Party.

     NOW, THEREFORE, in consideration of these premises and the mutual
representations, covenants and agreements of the Company, binding itself and its
successors and assigns, the Company and the Secured Party hereby amend and
restate the Original Security Agreement with all of the terms, conditions and
provisions set forth in this Agreement and all of the terms, conditions and
provisions of the Original Security Agreement are hereby deemed superseded,
substituted and replaced by the terms, conditions and provisions of this
Agreement.

     1. Certain Definitions. As used in this Agreement, the following terms
shall have the meanings set forth in this Section 1. Terms used but not
otherwise defined in this Agreement that are defined in Article 9 of the UCC
(such as "general intangibles" and "proceeds") shall have the respective
meanings given such terms in Article 9 of the UCC.

        (a) "Collateral" means the collateral in which the Secured Party is
granted a security interest by this Agreement and which shall include the
following, whether presently owned or existing or hereafter acquired or coming
into existence, and all additions and accessions thereto and all substitutions
and replacements thereof, and all proceeds, products and accounts thereof,
including, without limitation, all proceeds from the sale or transfer of the
Collateral and of insurance covering the same and of any tort claims in
connection therewith:

            (i)   All Goods of the Company, including, without limitations, all
        machinery, equipment, computers, motor vehicles, trucks, tanks, boats,
        ships, appliances, furniture, special and general tools, fixtures, test
        and quality control devices and other equipment of every kind and nature
        and wherever situated, together with all documents of title and
        documents representing the same, all additions and accessions thereto,
        replacements therefor, all parts therefor, and all substitutes for any
        of the foregoing and all other items used and useful in connection with
        the Company's businesses and all improvements thereto (collectively, the
        "Equipment"); and

            (ii)  All Inventory of the Company; and

            (iii) All of the Company's contract rights and general intangibles,
        including, without limitation, all partnership interests, stock or other
        securities, licenses, distribution and other agreements, computer
        software development rights, leases, franchises, customer lists, quality
        control procedures, grants and

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rights, goodwill, deposit accounts, and income tax refunds (collectively, the
"General Intangibles"); and

            (iv)  All of the Company's intellectual property of any kind,
        including, without limitation, patents, patent applications, trademarks,
        trademark applications, trade names, service marks, service mark
        applications, copyrights, copyright applications, rights to sue and
        recover for past infringement of patents, trademarks and copyrights and
        engineering drawings (collectively, the "Intellectual Property"); and

            (v)   All Receivables of the Company including all insurance
        proceeds, and rights to refunds or indemnification whatsoever owing,
        together with all instruments, all documents of title representing any
        of the foregoing, all rights in any merchandising, goods, equipment,
        motor vehicles and trucks which any of the same may represent, and all
        right, title, security and guaranties with respect to each Receivable,
        including any right of stoppage in transit; and

            (vi)  The commercial tort claims of the Company set forth on
Schedule D attached hereto; and

            (vii) All of the Company's documents, instruments and chattel paper,
files, records, books of account, business papers, computer programs and the
products and proceeds of all of the foregoing Collateral set forth in clauses
(i)-(vi) above.

        (b) "Company" shall mean, collectively, Company and all of the
subsidiaries of Company, a list of which is contained in Schedule A, attached
hereto.

        (c) "Obligations" means all of the Company's obligations under this
Agreement, the Purchase Agreements, the Debentures and Warrants issued pursuant
to the Purchase Agreements, and the Registration Rights Agreement (as defined in
each of the Purchase Agreements) in each case, whether now or hereafter
existing, voluntary or involuntary, direct or indirect, absolute or contingent,
liquidated or unliquidated, whether or not jointly owed with others, and whether
or not from time to time decreased or extinguished and later decreased, created
or incurred, and all or any portion of such obligations or liabilities that are
paid, to the extent all or any part of such payment is avoided or recovered
directly or indirectly from the Secured Party as a preference, fraudulent
transfer or otherwise as such obligations may be amended, supplemented,
converted, extended or modified from time to time.

        (d) "UCC" means the Uniform Commercial Code, as currently in effect in
the State of New York.

     2. Grant of Security Interest. (i) As an inducement for the Secured Party
to purchase the Debentures and to secure the complete and timely payment,
performance and discharge in full, as the case may be, of all of the
Obligations, the Company hereby, unconditionally and irrevocably, pledges,
grants and hypothecates to the Secured Party, a continuing first priority
security interest in, a continuing first lien upon, an unqualified right to
possession and disposition of and a right of set-off against, in each case to
the fullest extent

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permitted by law, all of the Company's right, title and interest of whatsoever
kind and nature in and to the Collateral (the "Security Interest").

        (ii)  This Agreement is not intended to create a new lending
relationship between the Company and the Secured Party, but is instead intended
to restate, amend and supplement the terms, conditions and provisions of an
existing relationship and to add additional loans to the Obligations secured by
the Collateral. The provisions of this Section 2 shall be deemed to ratify the
existing security interest of the Secured Party in and to the Collateral, to the
extent such security interest existed prior to the date hereof, and to create a
security interest in the Collateral in favor of the Secured Party, to the extent
that no security interest therein existed.

        (iii) The lien granted to the Secured Party under this Agreement shall
be deemed to secure the Obligations to each Secured Party, pari passu.

     3. Representations, Warranties, Covenants and Agreements of the Company.
The Company represents and warrants to, and covenants and agrees with,
the Secured Party as follows:

        (a)   The Company has the requisite corporate power and authority to
enter into this Agreement and otherwise to carry out its obligations hereunder.
The execution, delivery and performance by the Company of this Agreement and the
filings contemplated herein have been duly authorized by all necessary action on
the part of the Company and no further action is required by the Company. This
Agreement constitutes a legal, valid and binding obligation of the Company
enforceable in accordance with its terms, except as enforceability may be
limited by bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditor's rights generally.

        (b)   The Company represents and warrants that it has no place of
business or offices where its respective books of account and records are kept
(other than temporarily at the offices of its attorneys or accountants) or
places where Collateral is stored or located, except as set forth on Schedule A
attached hereto;

        (c)   Except as set forth on Schedule C, the Company is the sole owner
of the Collateral (except for licenses granted by the Company in the ordinary
course of business), free and clear of any liens, security interests,
encumbrances, rights or claims, and is fully authorized to grant the Security
Interest in and to pledge the Collateral. There is not on file in any
governmental or regulatory authority, agency or recording office an effective
financing statement, security agreement, license or transfer or any notice of
any of the foregoing (other than those that have been filed in favor of the
Secured Party pursuant to this Agreement) covering or affecting any of the
Collateral, except as set forth on Schedule C. So long as this Agreement shall
be in effect, the Company shall not execute and shall not knowingly permit to be
on file in any such office or agency any such financing statement or other
document or instrument (except to the extent filed or recorded in favor of the
Secured Party pursuant to the terms of this Agreement), except as set forth on
Schedule C.

        (d)   No part of the Collateral has been judged invalid or
unenforceable. No written claim has been received that any Collateral or the
Company's use of any Collateral

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violates the rights of any third party. There has been no adverse decision to
the Company's claim of ownership rights in or exclusive rights to use the
Collateral in any jurisdiction or to the Company's right to keep and maintain
such Collateral in full force and effect, and there is no proceeding involving
said rights pending or, to the best knowledge of the Company, threatened before
any court, judicial body, administrative or regulatory agency, arbitrator or
other governmental authority.

        (e) The Company shall at all times maintain its books of account and
records relating to the Collateral at its principal place of business and its
Collateral at the locations set forth on Schedule A attached hereto and may not
relocate such books of account and records or tangible Collateral unless it
delivers to the Secured Party at least thirty (30) days prior to such relocation
(i) written notice of such relocation and the new location thereof (which must
be within the United States) and (ii) evidence that appropriate financing
statements and other necessary documents have been filed and recorded and other
steps have been taken to perfect the Security Interest to create in favor of the
Secured Party valid, perfected and continuing first priority liens in the
Collateral. The Company shall not change its jurisdiction of incorporation
unless (i) the Company provides the Secured Party at least thirty (30) days
prior written notice of such change, and (ii) all filings have been made under
the UCC or otherwise that are required in order for the Secured Party to
continue at all times following such change to have a valid, legal and perfected
first priority security interest in the Collateral.

        (f) This Agreement creates in favor of the Secured Party a valid
security interest in the Collateral securing the payment and performance of the
Obligations and, upon making the filings described in the immediately following
sentence, a perfected first priority security interest in such Collateral.
Except for the filing of financing statements on Form UCC-1 under the UCC with
the jurisdictions indicated on Schedule B, attached hereto, no authorization or
approval of or filing with or notice to any governmental authority or regulatory
body is required either (i) for the grant by the Company of, or the
effectiveness of, the Security Interest granted hereby or for the execution,
delivery and performance of this Agreement by the Company or (ii) for the
perfection of or exercise by the Secured Party of its rights and remedies
hereunder.

        (g) The Company authorizes the Secured Party to file one or more
executed UCC financing statements on Form-1 with respect to the Security
Interest for filing with any jurisdictions deemed necessary or desirable by the
Secured Party to perfect its lien.

        (h) The execution, delivery and performance of this Agreement does not
conflict with or cause a breach or default, or an event that with or without the
passage of time or notice, shall constitute a breach or default, under any
agreement to which the Company is a party or by which the Company is bound. No
consent (including, without limitation, from shareholders or creditors of the
Company) is required for the Company to enter into and perform its obligations
hereunder.

        (i) The Company shall at all times maintain the liens and Security
Interest provided for hereunder as valid and perfected first priority liens and
security interests in the Collateral in favor of the Secured Party until this
Agreement and the Security Interest hereunder shall terminate pursuant to
Section 11. The Company hereby agrees to defend the same against

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any and all persons. The Company shall safeguard and protect all Collateral for
the account of the Secured Party. At the request of the Secured Party, the
Company will sign and deliver to the Secured Party at any time or from time to
time one or more financing statements pursuant to the UCC (or any other
applicable statute) in form reasonably satisfactory to the Secured Party and
will pay the cost of filing the same in all public offices wherever filing is,
or is deemed by the Secured Party to be, necessary or desirable to effect the
rights and obligations provided for herein. Without limiting the generality of
the foregoing, the Company shall pay all fees, taxes and other amounts necessary
to maintain the Collateral and the Security Interest hereunder, and the Company
shall obtain and furnish to the Secured Party from time to time, upon demand,
such releases and/or subordinations of claims and liens which may be required to
maintain the priority of the Security Interest hereunder.

        (j) The Company will not transfer, pledge, hypothecate, encumber,
license (except for licenses granted by the Company in the ordinary course of
business), sell or otherwise dispose of any of the Collateral, except as
follows:

            (i)  the Company may sell its fast-dissolve oral drug delivery
        technology known as Easy-Tec, without the prior written consent of the
        Secured Party; and

            (ii) the Company may, with the consent of the Secured party, which
        consent shall not be unreasonably withheld, pledge its Receivables as
        collateral for the purpose of obtaining receivable financing and pledge
        Equipment being purchased by the Company through equipment financing.

Secured Party agrees to execute any releases, waivers or other documentation, in
a form reasonably satisfactory to the Secured Party, required to allow the
Company to take any or all of the actions allowed by this Section 3(j).

        (k) The Company shall keep and preserve its Equipment, Inventory and
other tangible Collateral in good condition, repair and order and shall not
operate or locate any such Collateral (or cause to be operated or located) in
any area excluded from insurance coverage.

        (l) The Company shall, within three (3) business days of obtaining
knowledge thereof, advise the Secured Party promptly, in sufficient detail, of
any substantial change in the Collateral, and of the occurrence of any event
which would have a material adverse effect on the value of the Collateral or on
the Secured Party's security interest therein.

        (m) The Company will obtain and deliver to the Secured Party such
instruments as may be reasonably requested by the Secured Party pursuant to
which any person with an interest in any real estate upon which any part of all
of the tangible Collateral is now or may hereafter be located consents to the
security interest granted herein, disclaims any interest in the tangible
Collateral as fixtures, waives in favor of the Secured Party all right to levy
upon the Collateral for rent due or to become due from the Company, and
authorizes the Secured Party (and its designees) to enter upon any premises of
the Company at any time and to remove the Collateral.

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            (n) The Company, at its own cost and expense, will insure the
Collateral in the name of the Secured Party against loss or damage by fire,
theft, burglary, pilferage, bodily injury and such other risks as the Secured
Party may require in such amounts at least equal to the replacement value of
tangible Collateral. All such policies shall (a) name the Secured Party as an
additional loss payee as to any casualty insurance and provide that no claim for
loss or damage may be settled, adjusted or comprised without the prior written
consent of the Secured Party, and (b) name the Secured Party as an "additional
insured" as to any liability insurance. All such policies shall further provide
for thirty (30) days' minimum written notice of modification or cancellation to
the Secured Party, together with duplicate premium notices to the Secured Party,
and the Company shall deliver to the Secured Party the original or duplicate
policies, or certificates or other evidence satisfactory to the Secured Party,
of compliance with the foregoing insurance provisions. The Company assumes all
responsibility and liability arising from the use of the Collateral, either for
negligence or otherwise, by whomsoever used, employed or operated, and will
defend, indemnify and save the Secured Party (and its respective officers,
directors, employees, and agents) harmless from any and all claim, loss or
damage to persons or property caused by the Collateral or by its use and
operation. The Secured Party may, but shall not be obligated, to pay any premium
with respect to any such insurance which the Company shall fail to timely pay,
which payment (together with any other payments made by the Secured Party to
defend, protect or preserve the Collateral) shall be added to the Obligations
due and owing to the Secured Party.

            (o) The Company shall promptly execute and deliver to the Secured
Party, upon demand, such further deeds, mortgages, assignments, security
agreements, financing statements or other instruments, documents, certificates
and assurances and take such further action as the Secured Party may from time
to time request and may in its sole discretion deem necessary to perfect,
protect or enforce its security interest in the Collateral including, without
limitation, the execution and delivery of separate security agreements or
assignments with respect to any of the Intellectual Property (any of the
foregoing being referred to as an "Intellectual Property Security Agreement") in
which the Secured Party has been granted a security interest hereunder,
substantially in a form reasonably acceptable to the Secured Party, which
Intellectual Property Security Agreement, other than as stated herein, shall be
subject to all of the terms and conditions hereof.

            (p) The Company shall permit the Secured Party and its
representatives and agents to inspect the Collateral at any time, and to make
copies of records pertaining to the Collateral as may be requested by the
Secured Party from time to time.

            (q) The Company will take all steps reasonably necessary to
diligently pursue and seek to preserve, enforce and collect any rights, claims,
causes of action and accounts receivable in respect of the Collateral.

            (r) The Company shall promptly notify the Secured Party in
sufficient detail upon becoming aware of any attachment, garnishment, execution
or other legal process levied against any Collateral and of any other
information received by the Company that may materially affect the value of the
Collateral, the Security Interest or the rights and remedies of the Secured
Party hereunder.

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            (s) All information heretofore, herein or hereafter supplied to the
Secured Party by or on behalf of the Company with respect to the Collateral is
accurate and complete in all material respects as of the date furnished.

            (t) Schedule A attached hereto contains a list of all of the
subsidiaries of Company.

         4. Defaults. The following events shall be "Events of Default":

            (a) The occurrence of an Event of Default (as defined in the
Debentures) under the Debentures;

            (b) Any representation or warranty of the Company in this Agreement
or in the Intellectual Property Security Agreement shall prove to have been
incorrect in any material respect when made;

            (c) The failure by the Company to observe or perform any of its
obligations hereunder for ten (10) days after receipt by the Company of notice
of such failure from the Secured Party; and

            (d) The security interests granted herein do not constitute, for any
reason, a first priority security interest in the Collateral.

         5. Duty To Hold In Trust. Upon the occurrence of any Event of Default
and at any time thereafter, the Company shall, upon receipt by it of any
revenue, income or other sums subject to the Security Interest, whether payable
pursuant to the Debentures or otherwise, or of any check, draft, note, trade
acceptance or other instrument evidencing an obligation to pay any such sum,
hold the same in trust for the Secured Party and shall forthwith endorse and
transfer any such sums or instruments, or both, to the Secured Party for
application to the satisfaction of the Obligations.

         6. Rights and Remedies Upon Default. Upon occurrence of any Event of
Default and at any time thereafter, the Secured Party shall have the right to
exercise all of the remedies conferred hereunder and under the Debentures, and
the Secured Party shall have all the rights and remedies of a secured party
under the UCC and/or any other applicable law (including the Uniform Commercial
Code of any jurisdiction in which any Collateral is then located). Without
limitation, the Secured Party shall have the following rights and powers (all
such rights and powers being cumulative and not exclusive, and exercisable in
any order or in any combination at the discretion of the Secured Party):

            (a) The Secured Party shall have the right to take possession of the
Collateral and, for that purpose, enter, with the aid and assistance of any
person, any premises where the Collateral, or any part thereof, is or may be
placed and remove the same, and the Company shall assemble the Collateral and
make it available to the Secured Party at places which the Secured Party shall
reasonably select, whether at the Company's premises or elsewhere, and make
available to the Secured Party, without rent, all of the Company's respective
premises and facilities for the purpose of the Secured Party taking possession
of, removing or putting the Collateral in saleable or disposable form.

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            (b) The Secured Party shall have the right to operate the business
of the Company using the Collateral and shall have the right to assign, sell,
lease or otherwise dispose of and deliver all or any part of the Collateral, at
public or private sale or otherwise, either with or without special conditions
or stipulations, for cash or on credit or for future delivery, in such parcel or
parcels and at such time or times and at such place or places, and upon such
terms and conditions as the Secured Party may deem commercially reasonable, all
without (except as shall be required by applicable statute and cannot be waived)
advertisement or demand upon or notice to the Company or right of redemption of
the Company, which are hereby expressly waived. Upon each such sale, lease,
assignment or other transfer of Collateral, the Secured Party may, unless
prohibited by applicable law which cannot be waived, purchase all or any part of
the Collateral being sold, free from and discharged of all trusts, claims, right
of redemption and equities of the Company, which are hereby waived and released.
If any of the Collateral is sold by the Secured Party upon credit or for future
delivery, the Secured Party shall not be liable for the failure of the purchaser
to purchase or pay for the same and, in the event of any such failure, the
Secured Party may resell such Collateral.

            (c) The Secured Party may institute proceedings to collect all
Obligations from the Company or anyone else who may be responsible for the
payment of any Obligations.

            (d) The Secured Party may appropriate, set off and apply for the
payment of any or all of the Obligations, any and all balances, sums, property,
claims, credits, deposits, accounts, reserves, collections, drafts, notes, or
other items or proceeds of the Collateral in or coming into the possession of
the Secured Party or its agents and belonging or owing to the Company, without
notice to the Company, and in such manner as the Secured Party may in its sole
discretion determine.

            (e) The Secured Party may collect accounts receivable and any other
sums owing to the Company directly, or through an agent or designee, or in the
name of the Company.

         7. Applications of Proceeds. The proceeds of any such sale, lease or
other disposition of the Collateral hereunder shall be applied first, to the
expenses of retaking, holding, storing, processing and preparing for sale,
selling, and the like (including, without limitation, any taxes, fees and other
costs incurred in connection therewith) of the Collateral, to the reasonable
attorneys' fees and expenses incurred by the Secured Party in enforcing its
rights hereunder and in connection with collecting, storing and disposing of the
Collateral, and then to satisfaction of the Obligations (such proceeds being
applied first to accrued but unpaid interest on the Obligations, and second to
unpaid principal on the Obligations), and to the payment of any other amounts
required by applicable law, after which the Secured Party shall pay to the
Company any surplus proceeds. If, upon the sale, license or other disposition of
the Collateral, the proceeds thereof are insufficient to pay all amounts to
which the Secured Party is legally entitled, the Company will be liable for the
deficiency, together with interest thereon, at the rate of 12% per annum (the
"Default Rate"), and the reasonable fees of any attorneys employed by the
Secured Party to collect such deficiency. To the extent permitted by applicable
law, the Company waives all claims, damages and demands against the Secured
Party arising out of the repossession, removal, retention or sale of the
Collateral, unless due to the gross negligence or willful misconduct of the
Secured Party.

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     8.  Costs and Expenses. The Company agrees to pay all out-of-pocket fees,
costs and expenses incurred in connection with any filing required hereunder,
including without limitation, any financing statements, continuation statements,
partial releases and/or termination statements related thereto or any expenses
of any searches reasonably required by the Secured Party. The Company shall also
pay all other claims and charges which in the reasonable opinion of the Secured
Party might prejudice, imperil or otherwise affect the Collateral or the
Security Interest therein. The Company will also, upon demand, pay to the
Secured Party the amount of any and all reasonable expenses, including the
reasonable fees and expenses of its counsel and of any experts and agents, which
the Secured Party may incur in connection with (i) the enforcement of this
Agreement, (ii) the custody or preservation of, or the sale of, collection from,
or other realization upon, any of the Collateral, or (iii) the exercise or
enforcement of any of the rights of the Secured Party under the Debentures.
Until so paid, any fees payable hereunder shall be added to the principal amount
of the Debentures and shall bear interest at the Default Rate.

     9.  Responsibility for Collateral. The Company assumes all liabilities and
responsibility in connection with all Collateral, and the obligations of the
Company hereunder or under the Debentures shall in no way be affected or
diminished by reason of the loss, destruction, damage or theft of any of the
Collateral or its unavailability for any reason. Under no circumstances
whatsoever shall the Secured Party be deemed to assume any responsibility for or
obligation or duty with respect to any part or all of the Collateral, of any
nature or kind whatsoever, or any matter or proceedings arising out of or
relating thereto. The Secured Party shall not be required to take any action of
any kind to collect or protect any interest in the Collateral, including but not
limited to any action necessary to preserve its, or the Company's rights against
prior parties to any of the Collateral. The Secured Party shall not be liable or
responsible in any way for the safekeeping, care or custody of any of the
Collateral, or for any loss or damage thereto, or for any diminution in the
value thereof, or for any act or default of any agent of the Secured Party or
the Company, or of any carrier, forwarding agency or other person whomsoever, or
for the collection of any proceeds, but the same shall be at the Company's sole
risk at all times.

     10. Security Interest Absolute. All rights of the Secured Party and all
Obligations of the Company hereunder, shall be absolute and unconditional,
irrespective of: (a) any lack of validity or enforceability of this Agreement,
the Debentures or any agreement entered into in connection with the foregoing,
or any portion hereof or thereof; (b) any change in the time, manner or place of
payment or performance of, or in any other term of, all or any of the
Obligations, or any other amendment or waiver of or any consent to any departure
from the Debentures or any other agreement entered into in connection with the
foregoing; (c) any exchange, release or nonperfection of any of the Collateral,
or any release or amendment or waiver of or consent to departure from any other
collateral for, or any guaranty, or any other security, for all or any of the
Obligations; (d) any action by the Secured Party to obtain, adjust, settle and
cancel in its sole discretion any insurance claims or matters made or arising in
connection with the Collateral; or (e) any other circumstance which might
otherwise constitute any legal or equitable defense available to the Company, or
a discharge of all or any part of the Security Interest granted hereby. Until
the Obligations shall have been paid and performed in full, the rights of the
Secured Party shall continue even if the Obligations are barred for any reason,
including, without limitation, the running of the statute of limitations or
bankruptcy. The Company expressly waives presentment, protest, notice of
protest, demand, notice of

                                      -10-

<PAGE>

nonpayment and demand for performance. In the event that at any time any
transfer of any Collateral or any payment received by the Secured Party
hereunder shall be deemed by final order of a court of competent jurisdiction to
have been a voidable preference or fraudulent conveyance under the bankruptcy or
insolvency laws of the United States, or shall be deemed to be otherwise due to
any party other than the Secured Party, then, in any such event, the Company's
obligations hereunder shall survive cancellation of this Agreement, and shall
not be discharged or satisfied by any prior payment thereof and/or cancellation
of this Agreement, but shall remain a valid and binding obligation enforceable
in accordance with the terms and provisions hereof. The Company waives all right
to require the Secured Party to proceed against any other person or to apply any
Collateral which the Secured Party may hold at any time, or to marshal assets,
or to pursue any other remedy. The Company waives any defense arising by reason
of the application of the statute of limitations to any obligation secured
hereby.

         11. Term of Agreement. This Agreement and the Security Interest shall
terminate on the date on which all payments under the Debentures have been made
in full and/or the Debentures have been fully converted and all other
Obligations have been paid or discharged and all amounts payable by the Company
under the Warrants issued to the Secured Party of even date herewith and the
Registration Rights Agreement of even date herewith have been satisfied. Upon
such termination, the Secured Party, at the request and at the expense of the
Company, will join in executing any termination statement with respect to any
financing statement executed and filed pursuant to this Agreement.

         12. Power of Attorney; Further Assurances.

             (a) The Company authorizes the Secured Party, and does hereby make,
constitute and appoint it, and its respective officers, agents, successors or
assigns with full power of substitution, as the Company's true and lawful
attorney-in-fact, with power, in its own name or in the name of the Company, to,
after the occurrence and during the continuance of an Event of Default, (i)
endorse any notes, checks, drafts, money orders, or other instruments of payment
(including payments payable under or in respect of any policy of insurance) in
respect of the Collateral that may come into possession of the Secured Party;
(ii) to sign and endorse any UCC financing statement or any invoice, freight or
express bill, bill of lading, storage or warehouse receipts, drafts against
debtors, assignments, verifications and notices in connection with accounts, and
other documents relating to the Collateral; (iii) to pay or discharge taxes,
liens, security interests or other encumbrances at any time levied or placed on
or threatened against the Collateral; (iv) to demand, collect, receipt for,
compromise, settle and sue for monies due in respect of the Collateral; and (v)
generally, to do, at the option of the Secured Party, and at the Company's
expense, at any time, or from time to time, all acts and things which the
Secured Party deems necessary to protect, preserve and realize upon the
Collateral and the Security Interest granted therein in order to effect the
intent of this Agreement, the Debentures and the Warrants, all as fully and
effectually as the Company might or could do (including, without limitation, to
execute immediately upon demand of the Secured Party any assignments of
registered patents, trademarks or other intellectual property for purposes of
recording the same in the applicable filing offices).; and the Company hereby
ratifies all that said attorney shall lawfully do or cause to be done by virtue
hereof. This power of attorney is coupled with an interest and shall be
irrevocable for the term of this Agreement and thereafter as long as any of the
Obligations shall be outstanding.

                                      -11-

<PAGE>

             (b) On a continuing basis, the Company will make, execute,
acknowledge, deliver, file and record, as the case may be, in the proper filing
and recording places in any jurisdiction, including, without limitation, the
jurisdictions indicated on Schedule B, attached hereto, all such instruments,
and take all such action as may reasonably be deemed necessary or advisable, or
as reasonably requested by the Secured Party, to perfect the Security Interest
granted hereunder and otherwise to carry out the intent and purposes of this
Agreement, or for assuring and confirming to the Secured Party the grant or
perfection of a security interest in all the Collateral.

             (c) The Company hereby irrevocably appoints the Secured Party as
the Company's attorney-in-fact, with full authority in the place and stead of
the Company and in the name of the Company, from time to time in the Secured
Party's discretion, to take any action and to execute any instrument which the
Secured Party may deem necessary or advisable to accomplish the purposes of this
Agreement, including the filing, in its sole discretion, of one or more
financing or continuation statements and amendments thereto, relative to any of
the Collateral without the signature of the Company where permitted by law.

         13. Notices. All notices, requests, demands and other communications
hereunder shall be in writing, with copies to all the other parties hereto, and
shall be deemed to have been duly given when (i) if delivered by hand, upon
receipt, (ii) if sent by facsimile, upon receipt of proof of sending thereof,
(iii) if sent by nationally recognized overnight delivery service (receipt
requested), the next business day or (iv) if mailed by first-class registered or
certified mail, return receipt requested, postage prepaid, four days after
posting in the U.S. mails, in each case if delivered to the following addresses:

         If to the Company:          Antares Pharma, Inc.
                                     704 Eagleview Boulevard
                                     Suite 414
                                     Exton, Pennsylvania 19342
                                     Attention: Roger G. Harrison, Ph.D.
                                     Facsimile: 610-458-0756

         With copies to:             Leonard, Street and Deinard, P.A.
                                     150 South Fifth Street
                                     Suite 2300
                                     Minneapolis, Minnesota 55402
                                     Attention: Morris M. Sherman, Esq.
                                     Facsimile: 612-335-1561

         If to the Secured Party:    to the address set forth immediately
                                     below such Secured Party's name on the
                                     signature pages attached hereto.

                                      -12-

<PAGE>

                            With copies to:

                            Lowenstein Sandler PC
                            65 Livingston Avenue
                            Roseland, New Jersey 07068
                            Attention: Robert G. Minion, Esq.
                            Facsimile: 973-597-2400


         14. Other Security. To the extent that the Obligations are now or
hereafter secured by property other than the Collateral or by the guarantee,
endorsement or property of any other person, firm, corporation or other entity,
then the Secured Party shall have the right, in its sole discretion, to pursue,
relinquish, subordinate, modify or take any other action with respect thereto,
without in any way modifying or affecting any of the Secured Party's rights and
remedies hereunder.

         15. Miscellaneous.

             (a) No course of dealing between the Company and the Secured Party,
nor any failure to exercise, nor any delay in exercising, on the part of the
Secured Party, any right, power or privilege hereunder or under the Debentures
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, power or privilege hereunder or thereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.

             (b) All of the rights and remedies of the Secured Party with
respect to the Collateral, whether established hereby or by the Debentures or by
any other agreements, instruments or documents or by law shall be cumulative and
may be exercised singly or concurrently.

             (c) This Agreement constitutes the entire agreement of the parties
with respect to the subject matter hereof and is intended to supersede all prior
negotiations, understandings and agreements with respect thereto. Except as
specifically set forth in this Agreement, no provision of this Agreement may be
modified or amended except by a written agreement specifically referring to this
Agreement and signed by the parties hereto.

             (d) In the event that any provision of this Agreement is held to be
invalid, prohibited or unenforceable in any jurisdiction for any reason, unless
such provision is narrowed by judicial construction, this Agreement shall, as to
such jurisdiction, be construed as if such invalid, prohibited or unenforceable
provision had been more narrowly drawn so as not to be invalid, prohibited or
unenforceable. If, notwithstanding the foregoing, any provision of this
Agreement is held to be invalid, prohibited or unenforceable in any
jurisdiction, such provision, as to such jurisdiction, shall be ineffective to
the extent of such invalidity, prohibition or unenforceability without
invalidating the remaining portion of such provision or the other provisions of
this Agreement and without affecting the validity or enforceability of such
provision or the other provisions of this Agreement in any other jurisdiction.

                                      -13-

<PAGE>

             (e) No waiver of any breach or default or any right under this
Agreement shall be considered valid unless in writing and signed by the party
giving such waiver, and no such waiver shall be deemed a waiver of any
subsequent breach or default or right, whether of the same or similar nature or
otherwise.

             (f) This Agreement shall be binding upon and inure to the benefit
of each party hereto and its successors and assigns.

             (g) Each party shall take such further action and execute and
deliver such further documents as may be necessary or appropriate in order to
carry out the provisions and purposes of this Agreement.

             (h) This Agreement shall be construed in accordance with the laws
of the State of New York, except to the extent the validity, perfection or
enforcement of a security interest hereunder in respect of any particular
Collateral which are governed by a jurisdiction other than the State of New York
in which case such law shall govern. Each of the parties hereto irrevocably
submit to the exclusive jurisdiction of any New York State or United States
Federal court sitting in Manhattan county over any action or proceeding arising
out of or relating to this Agreement, and the parties hereto hereby irrevocably
agree that all claims in respect of such action or proceeding may be heard and
determined in such New York State or Federal court. The parties hereto agree
that a final judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law. The parties hereto further waive any objection to venue
in the State of New York and any objection to an action or proceeding in the
State of New York on the basis of forum non conveniens.

             (i) EACH PARTY HERETO HEREBY AGREES TO WAIVE ITS RESPECTIVE RIGHTS
TO A JURY TRAIL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF
THIS AGREEMENT. THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL ENCOMPASSING OF
ANY DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATER
OF THIS AGREEMENT, INCLUDING WITHOUT LIMITATION CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS. EACH PARTY
HERETO ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT FOR EACH PARTY TO
ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH PARTY HAS ALREADY RELIED ON THIS
WAIVER IN ENTERING INTO THIS AGREEMENT AND THAT EACH PARTY WILL CONTINUE TO RELY
ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS. EACH PARTY FURTHER WARRANTS AND
REPRESENTS THAT IT HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT
SUCH PARTY HAS KNOWINGLY AND VOLUNTARILY WAIVED ITS RIGHTS TO A JURY TRIAL
FOLLOWING SUCH CONSULTATION. THIS WAIVER IS IRREVOCABLE, MEANING THAT,
NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, IT MAY NOT BE MODIFIED EITHER
ORALLY OR IN WRITING, AND THIS WAIVER SHALL APPLY TO ANY SUBSEQUENT AMENDMENTS,
RENEWALS AND SUPPLEMENTS OR MODIFICATIONS TO THIS AGREEMENT. IN THE EVENT OF A
LITIGATION

                                      -14-

<PAGE>

PROCEEDING, THIS AGREEMENT MAY BE FILED AS A WRITTEN CONSENT TO A TRIAL BY THE
COURT.

             (j) This Agreement may be executed in any number of counterparts,
each of which when so executed shall be deemed to be an original and, all of
which taken together shall constitute one and the same Agreement. In the event
that any signature is delivered by facsimile transmission, such signature shall
create a valid binding obligation of the party executing (or on whose behalf
such signature is executed) the same with the same force and effect as if such
facsimile signature were the original thereof.

                                      -15-

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Security
Agreement to be duly executed on the day and year first above written.

ANTARES PHARMA, INC.                      XMARK FUND, L.P.
                                          By:


/s/ Lawrence M. Christian                 By:   /s/ David C. Cavalier
-----------------------------------          -----------------------------------
Lawrence M. Christian                           David C. Cavalier
Chief Financial Officer                         Chief Operating Officer

                                          ADDRESS: 152 West 57th Street
                                                   21st Floor
                                                   New York, NY 10019
                                                   Facsimile: (212) 247-1329
                                                   Telephone: (212) 247-8200


                                          XMARK FUND, LTD.

                                          By:   /s/ David C. Cavalier
                                             -----------------------------------
                                                David C. Cavalier
                                                Chief Operating Officer

                                          ADDRESS: 152 West 57th Street
                                                   21st Floor
                                                   New York, NY 10019
                                                   Facsimile: (212) 247-1329
                                                   Telephone: (212) 247-8200


                                          SDS MERCHANT FUND, LP
                                          By:  SDS Capital Partners, LLC,
                                               its General Partner

                                          By:   /s/ Steve Derby
                                             -----------------------------------
                                                Steve Derby
                                                Managing Member

                                          ADDRESS: c/o SDS Capital Partners, LLC
                                                   53 Forest Avenue, Suite 203
                                                   Old Greenwich, CT 06780
                                                   Facsimile: (203) 967-5851
                                                   Telephone: (203) 247-5850

                                      -16-