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                                                                   EXHIBIT 4.13


                               DRAXIS HEALTH INC.
                            DEFERRED SHARE UNIT PLAN
                                  FOR EMPLOYEES

1.       INTRODUCTION

1.1      PURPOSE

         The Draxis Health Inc. Deferred Share Unit Plan for senior management
employees has been established to provide such employees of Draxis Health Inc.
and its subsidiaries with the opportunity to acquire share equivalent units
convertible to cash or Common Shares of Draxis Health Inc. upon the termination
of employment of an employee. Acquiring such units will allow these employees to
participate in the long-term success of Draxis Health Inc. and will promote a
greater alignment of interests between such employees and the shareholders.

1.2      DEFINITIONS

         For purposes of the Plan:

         (a)      "Annual Remuneration" means the Base Salary and Bonus payable
                  to an Eligible Employee by the Company in or in respect of
                  each financial year;

         (b)      "Applicable Withholding Taxes" means any and all taxes and
                  other source deductions or other amounts which the Company is
                  required by law to withhold from any amounts to be paid or
                  credited hereunder;

         (c)      "Award Date" means each date on which Deferred Share Units are
                  credited to an Eligible Employee in accordance with
                  Section 3.1, which shall be, unless otherwise determined by
                  the Committee, January 1st of each financial year in which the
                  Eligible Employee is eligible to participate in the Plan,
                  except (i) in 2000 the first year of the Plan in which case
                  the Award Date shall be February 1, 2000; and (ii) in the case
                  of bonuses earned in respect of any particular year in which
                  case the Award Date shall be the day, within the first
                  calendar quarter of the year following the particular year, on
                  which the amount of the Bonus is awarded;

         (d)      "Award Market Value" means the last reported sale price of
                  Common Shares on the Toronto or NASDAQ Stock Exchanges on
                  December 31 of the fiscal year just ended, or if such day is
                  not a business day, then the last business day in December
                  except in respect of 1999 when the date shall be deemed to be
                  February 1, 2000.


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         (e)      "Base Salary" means the regular base salary received by an
                  Eligible Employee from the Company during the relevant
                  financial year as determined by the Company from time to time
                  excluding vacation pay in lieu of time off, Bonuses, service
                  awards or any special compensation;

         (f)      "Bonus" means an amount in addition to Base Remuneration
                  calculated and awarded by the Board to an Eligible Employee
                  following completion of a financial year in respect of such
                  Employee's contribution to the operations of the Company for
                  such financial year, excluding for greater certainty, any
                  payments under the Stock Ownership Plan or, its predecessor,
                  the Stock Purchases and Bonus Plan;

         (g)      "Board" means the board of directors of the Company;

         (h)      "Committee" means the committee of the Board responsible for
                  recommending to the Board the eligibility of an employee to
                  participate in this Plan;

         (i)      "Common Shares" means the common shares of the Company;

         (j)      "Company" means Draxis Health Inc. or any of its subsidiaries
                  or affiliates as defined in paragraph 3 of the Canada Customs
                  and Revenue Agency Interpretation Bulletin IT-337R3 that may
                  adopt the Plan pursuant to its terms;

         (k)      "Deferred Share Unit" means a unit equivalent in value to a
                  Common Share, credited by means of a bookkeeping entry in the
                  books of the Company in accordance with an election made by an
                  Eligible Employee pursuant to Section 3;

         (l)      "Deferred Share Units outstanding under the Plan" or "Deferred
                  Share Units credited to an Employee's Account" at a particular
                  time for the purposes of Articles 4 and 5 shall be deemed to
                  mean and include at any particular time in any particular
                  financial year Deferred Share Units subsequently granted in
                  respect of a Bonus determined in respect of a completed
                  financial year and in respect of which an Eligible Employee
                  has made an election pursuant to Section 3.2;

         (m)      "Deferred Share Unit Amount" has the meaning given thereto in
                  Section 4.1;

         (n)      "Dividend Equivalents" means a bookkeeping entry whereby each
                  Deferred Share Unit is credited with the equivalent amount of
                  the dividend or other distribution paid on a Common Share in
                  accordance with Section 3.3;

         (o)      "Dividend Market Value" means the average of the daily high
                  and low board lot trading prices of Common Shares on The
                  Toronto or Nasdaq Stock Exchanges



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                  on each of the five trading days prior to the Award Date on
                  which there was a trade of a board lot of Common Shares;

         (p)      "Election Form" means a document substantially in the form of
                  Schedule "A" to this Plan;

         (q)      "Eligible Employee" means a person who is, at the relevant
                  time, an employee of the Company or any of its subsidiaries
                  and is designated by the Committee as eligible to participate
                  in the Plan;

         (r)      "Plan" means this Draxis Health Inc. Deferred Share Unit Plan
                  for Employees, as amended from time to time;

         (s)      "Redemption Date" means the date upon which an Eligible
                  Employee ceases to be employed by the Company or any of its
                  subsidiaries or affiliates as defined in paragraph 3 of the
                  Canada Customs and Revenue Agency's Interpretation Bulletin IT
                  337R3; and

         (t)      "Redemption Value" means the average of the daily high and low
                  board lot trading prices of Common Shares on The Toronto or
                  Nasdaq Stock Exchanges on each of the five trading days prior
                  to the Redemption Date on which there was a trade of a board
                  lot of Common Shares. Should Common Shares no longer be
                  publicly traded at the relevant time such that the Award
                  Market Value cannot be determined in accordance with the
                  formula set out herein, such value shall be determined by the
                  Committee in good faith and shall depend upon the fair market
                  value of the Common Shares within the period that commences
                  one year before the Award Date and ends at the time of the
                  Award Date except in the case of a Bonus where such period
                  shall commence January 1st of the year in which the amount of
                  the Bonus is determined and end on the date the amount of the
                  Bonus is awarded.

1.3      EFFECTIVE DATE OF PLAN

         The effective date of the Plan shall be February 1, 2000 or such other
later date as the Board may determine.

2.       ADMINISTRATION

2.1      ADMINISTRATION OF THE PLAN

         The Plan shall be administered by the Board of Directors which shall,
without limitation, have full and final authority in its discretion, but subject
to the express provisions of the Plan, to interpret the Plan, to prescribe,
amend and rescind rules and regulations relating to it and to



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make all other determinations deemed necessary or advisable for the
administration of the Plan. The Board of Directors may delegate any or all of
its authority with respect to the administration of the Plan and any or all of
the rights, powers and discretions with respect to the Plan granted to it
hereunder to the Committee or such other committee of directors of the Company
as the Board of Directors may designate and upon such delegation the Committee
or other committee of directors, as the case may be, as well as the Board of
Directors, shall be entitled to exercise any or all of such authority, rights,
powers and discretions with respect to the Plan. The directors of the Company
may fully participate in voting and in other deliberations or proceedings of the
Board of Directors in respect of the Plan, notwithstanding: (i) the eligibility
of any of the directors to participate in the Plan; and (ii) that any of the
directors may hold Deferred Share Units granted pursuant to the Plan.

2.2      TAXES AND OTHER SOURCE DEDUCTIONS

         The Company shall be authorized to deduct from any amount to be paid or
credited hereunder any Applicable Withholding Taxes in such manner as the
Company determines.

3.       DEFERRED SHARE UNITS

3.1      AWARD OF DEFERRED SHARE UNITS

(a)      Each Eligible Employee shall be credited with Deferred Share Units
in respect of that part of an Eligible Employee's Base Salary which such
Eligible Employee has elected to receive in the form of Deferred Share Units
as provided in Section 3.2, in the manner set forth in this Plan. All
Deferred Share Units to be credited to an Eligible Employee will be credited
to an account maintained for the Eligible Employee on the books of the
Company. The Deferred Share Units to be credited to an Eligible Employee will
be credited to such account on each Award Date in respect of the portion of
his or her base Salary to be credited in Deferred Share Units to be earned in
the financial year commencing on the Award Date. The number of Deferred Share
Units (including fractional Deferred Share Units) to be credited on each
Award Date shall be determined by dividing (a) the amount of the applicable
portion of the Base Salary to be credited in Deferred Share Units on that
Award Date by (b) the Award Market Value.

(b)      Each Eligible Employee shall be credited with Deferred Share Units
in respect of that part of an Eligible Employee's Bonus which such Eligible
Employee has elected to receive in the form of Deferred Share Units as
provided in Section 3.2, in the manner set forth in this Plan. All Deferred
Share Units to be credited to an Eligible Employee will be credited to an
account maintained for the Eligible Employee on the books of the Company. The
Deferred Share Units to be credited to an Eligible Employee will be credited
to such account as of the Award Date for a relevant financial year upon
determination of the Bonus earned following completion of such financial
year. The number of Deferred Share Units (including fractional Deferred Share
Units) to be credited effective each Award Date shall be determined by
dividing (a) the amount of the

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applicable portion of the Bonus to be credited in Deferred Share Units effective
that Award Date by (b) the Award Market Value determined in respect of that
Award Date.

3.2      ELECTION

         Each Eligible Employee shall have the right to elect on December 1
of each financial year (except 2000 the First year of the Plan in which case
the date shall be February 1, 2000) whether such Employee wishes to receive
some of such Employee's Annual Remuneration for the immediately succeeding
financial year (or for that part of the year remaining in the case of 2000)
in the form of Deferred Share Units. This election shall be made by
completing, signing and delivering to the Secretary of the Company the
Election Form: (a) in the case of an existing employee, by December of the
Financial year preceding the Financial year to which such election is to
apply; or (b) in the case of 2000 by February 1, 2000. In each case, the
election, when made, shall only apply prospectively with respect to the
Eligible Employee's Annual Remuneration yet to be earned.

3.3      CREDITS FOR DIVIDENDS

(a)      An Eligible Employee's account shall be credited with Dividend
Equivalents in the form of additional Deferred Share Units on each dividend
payment date in respect of which ordinary course cash dividends are paid on
Common Shares. Such Dividend Equivalents shall be computed by dividing: (a)
the amount obtained by multiplying the amount of the dividend declared and
paid per Common Share by the number of Deferred Share Units recorded in the
Eligible Employee's account on the record date for the payment of such
dividend, by (b) the Dividend Market Value, with fractions computed to three
decimal places.

(b)      All Dividend Equivalents credited hereunder at any particular time
in a year to an Eligible Employee in the form of Deferred Share Units shall
be adjusted as of the particular dividend payment date to reflect the
determination at the end of a year of additional Deferred Share Units in
respect of a Bonus concerning which an Eligible Employee has made an election
pursuant to the provisions of 3.1 and 3.2.

3.4      REPORTING OF DEFERRED SHARE UNITS

         Statements of the Deferred Share Unit accounts will be provided to
the Eligible Employees at least annually.

4.       REDEMPTION OF DEFERRED SHARE UNITS

4.1      REDEMPTION OF DEFERRED SHARE UNITS

(a)      An Eligible Employee shall be entitled on the Redemption Date to
redeem the Deferred Share Units credited to the Eligible Employee's account
for an amount (the "Deferred Share Unit

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Amount") equal to the product that results from multiplying (i) the number of
Deferred Share Units recorded in the Eligible Employee's account on the
Redemption Date by (ii) the Redemption Value of the Common Shares. Upon payment
in full by the Company to the Eligible Employee of the value of the Deferred
Share Unit Amount, the Deferred Share Units shall be cancelled.

(b)      The Deferred Share Unit Amount payable to an Eligible Employee, less
any Applicable Withholding Taxes, may be used to acquire Common Shares on the
open market through an independent broker designated by the Company (the
"Designated Broker") or may be paid in cash less Applicable Withholding Taxes
to the Eligible Employee, at the discretion of the Company. The Company will
also make a cash payment, less any Applicable Withholding Taxes, to the
Eligible Employee with respect to the value of fractional Deferred Share
Units standing to the Eligible Employee's credit.

(c)      If the Company has determined, that payment of the Deferred Share
Unit Amount be made in the form of Common Shares purchased on the open market
through a Designated Broker, as described in Section 4.1 (b) above, the
Company will calculate the number of whole Common Shares to be purchased by
the Designated Broker on the open market on behalf and for the benefit of the
Eligible Employee. The number of Common Shares will be determined by dividing
(i) the Deferred Share Unit Amount payable, less any Applicable Withholdings
Taxes, by (ii) the Redemption Value of a Common Share as determined on the
Redemption Date or, if the Redemption Date is not a trading date for shares
on the Toronto and Nasdaq Stock Exchanges, on the next such trading date and
the Company shall advise the Designated Broker of the specified number of
whole Common Shares to be purchased on behalf of the Eligible Employee. The
Designated Broker will purchase the specified number of whole Common Shares
as soon practicable after being notified by the Company. On or before the
date of settlement with respect to the purchase of the Common Shares by the
Designated Broker, the Company, acting as agent for the Eligible Employee,
will pay the purchase price of the specified number of Common Shares to the
Designated Broker, together with any reasonable brokerage fees or commissions
related thereto. The Company will also make a cash payment, less any
Applicable Withholdings Taxes, to the Eligible Employee with respect to the
value of fractional Deferred Share Units still standing to the Eligible
Employee's credit after the maximum number of whole Common Shares has been
purchased as described above.

(d)      Deferred Share Unit Amounts paid by the Company in accordance with
(a) through (c) above will be paid to or on behalf of the Eligible Employee
within 60 days of the Redemption Date.

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4.2      DEATH OF ELIGIBLE EMPLOYEE PRIOR TO REDEMPTION

         Upon the death of an Eligible Employee prior to the redemption of
the Deferred Share Units credited to the account of such Eligible Employee
under the Plan, a dependant relation or legal representative, shall be
entitled to redeem the Deferred Share Units in accordance with Section 4.1.
For greater certainty, the Deferred Share Unit Amount payable shall be
equivalent to the amount which would have been paid to the Eligible Employee
pursuant to and subject to Section 4.1, calculated as if the Eligible
Employee had previously ceased to be an employee of the Company on the day
prior to his or her death.

4.3      In the event a Redemption Date occurs prior to the end of a
financial year, the number of Deferred Share Units awarded to an Eligible
Employee in respect of his Annual Remuneration for that particular year
shall, for the purposes of calculating the Redemption Value, be reduced
proportionately to reflect that the Eligible Employee was employed by the
Company for less than that particular full financial year.

5.       GENERAL

5.1      ADJUSTMENTS TO DEFERRED SHARE UNITS

         In the event of the declaration of any stock dividend, a
subdivision, consolidation, reclassification, exchange, or other change with
respect to the Common Shares, or a merger, consolidation, spin-off, or other
distribution (other than ordinary course cash dividends) of the Company's
assets to its shareholders, the account of each Eligible Employee and the
Deferred Share Units outstanding under the Plan shall be adjusted to
appropriately reflect the event. However, no amount will be paid to, or in
respect of, an Eligible Employee under the Plan or pursuant to any other
arrangement, and no Deferred Share Units will be granted to such Eligible
Employee to compensate for a downward fluctuation in the price of Common
Shares, nor will any other form of benefit be conferred upon, or in respect
of, an Eligible Employee for such purpose.

5.2      DESIGNATION OF BENEFICIARY

         An Eligible Employee may, by written notice to the Secretary of the
Company, designate a person to receive the benefits payable under the Plan on
the Eligible Employee's death, and may also by written notice to the Secretary
of the Company alter or revoke such designation from time to time, subject
always to the provisions of any applicable law. Such written notice shall be in
such form and shall be executed in such manner as the Committee in its
discretion may from time to time determine.


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5.3      AMENDMENT, SUSPENSION, OR TERMINATION OF PLAN

(a)      The Board may from time to time amend or suspend the Plan in whole
or in part and may at any time terminate the Plan. However, any such
amendment, suspension, or termination shall not adversely affect the right of
any Eligible Employee with respect to Deferred Share Units credited to such
Eligible Employee at the time of such amendment, suspension or termination,
without the consent of the affected Eligible Employee.

(b)      If the Board terminates the Plan, no new Deferred Share Units will
be credited to the account of an Eligible Employee, but previously credited
Deferred Share Units and Deferred Share Units to be credited to the end of a
financial year with respect to any Bonus pursuant to Section 3.1 shall remain
outstanding and shall be entitled to Dividend Equivalents as provided under
section 3.3, and be paid in accordance with the terms and conditions of the
Plan existing at the time of termination. The Plan will finally cease to
operate for all purposes when the last remaining Eligible Employee receives
payment, in cash or Common Shares, in satisfaction of all Deferred Share
Units recorded in the Eligible Employee's account.

5.4      COMPLIANCE WITH LAWS

         The administration of the Plan shall be subject to and performed in
conformity with all applicable laws and any applicable regulations of a duly
constituted authority. Should the Committee, in its sole discretion, determine
that it is not feasible or desirable to honour an election in favour of Deferred
Share Units due to such laws or regulations, its obligation shall be satisfied
by means of an equivalent cash payment (equivalence being determined on a
before-tax basis).

5.5      REORGANIZATION OF THE COMPANY

         The existence of any Deferred Share Units shall not affect in any way
the right or power of the Company or its shareholders to make or authorize any
adjustment, recapitalization, reorganization or other change in the Company's
capital structure or its business, or any amalgamation, combination, merger or
consolidation involving the Company or to create or issue any bonds, debentures,
shares or other securities of the Company or the rights and conditions attaching
thereto or to effect the dissolution or liquidation of the Company or any sale
or transfer of all or any part of its assets or business, or any other corporate
act or proceeding, whether of a similar nature or otherwise.



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5.6      GENERAL RESTRICTIONS AND ASSIGNMENT

(a)      Except as required by law, the rights of an Eligible Employee under
the Plan are not capable of being anticipated, assigned, transferred,
alienated, sold, encumbered, pledged, mortgaged or charged and are not
capable of being subject to attachment or legal process for the payment of
any debts or obligations of the Eligible Employee.

(b)      Rights and obligations under the Plan may be assigned by the Company
to a successor in the business of the Company.

5.7      NO RIGHT TO SERVICE

         Neither participation in the Plan nor any action taken under the
Plan shall give or be deemed to give any Eligible Employee a right to
continued employment with the Company or any of its subsidiaries and shall
not interfere with any right of the Company to terminate the employment of
any Eligible Employee at any time.

5.8      NO SHAREHOLDER RIGHTS

         Under no circumstances shall Deferred Share Units be considered
Common Shares or shares of any other class of the Company, nor entitle any
Eligible Employee to exercise voting rights or any other rights attaching to
the ownership of Common Shares, nor shall any Eligible Employee be considered
the owner of the Common Shares by virtue of the award of Deferred Share Units.

5.9      GOVERNING LAW

         The Plan shall be governed by, and interpreted in accordance with,
the laws of the Province of Ontario and the laws of Canada applicable therein.

5.10     INTERPRETATION

         In this text words importing the singular meaning shall include the
plural and VICE VERSA, and words importing the masculine shall include the
feminine and neuter genders.

5.11     SEVERABILITY

         The invalidity or unenforceability of any provision of this Plan
shall not affect the validity or enforceability of any other provision and
any invalid or unenforceable provision shall be severed from this Plan.

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                                  SCHEDULE "A"

                   DRAXIS HEALTH INC. DEFERRED SHARE UNIT PLAN
                           FOR DIRECTORS (THE "PLAN")

                              ANNUAL ELECTION FORM

1.       ANNUAL REMUNERATION

(a)      I elect to receive my Base Remuneration as follows (please check either
         Box "A" or Box "B"):

                A.       _______% in Deferred Share Units (not to exceed 20%)

                         and

                B.       _______% in cash.

(b)      I elect to receive my Bonus, if any, as follows: (Please check either
         Box "C" or Box "D"

                C.       _______% in Deferred Share Units (not to exceed 100%)

                D.       _______% in cash.

2.       DESIGNATION OF BENEFICIARY

         In accordance with the terms of the Plan, I appoint as designated
         beneficiary, or if previously done, I hereby revoke any designation of
         beneficiary heretofore made by me under the Plan, and hereby appoint as
         designated beneficiary to receive any payment in accordance with the
         Plan that may fall due after my death:

         ______________________[INSERT FULL NAME]; provided, however, that if
         the above named beneficiary predeceases me such payment shall be made
         to my estate.


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3.       I UNDERSTAND THAT:

         -        All capitalized terms shall have the meanings attributed to
                  them under the Plan.

         -        All payments will be net of any Applicable Withholding Taxes.


         ____________________________)   ___________________________________
         Witness Signature           )   Eligible Employee's Signature
                                     )
         ____________________________)   _____________________________________)
         Witness Name (please print) )   Eligible Employee's Name (please print)
                                     )
                                     )
                                     )   ____________________________________
                                     )   Date

UNITL THIS ELECTION FORM IS RETURNED TO THE SECRETARY OF THE COMPANY, 100% OF
THE ANNUAL REMUNERATION WILL BE RECEIVED IN THE FORM OF CASH.