<PAGE>

                                                                     EXHIBIT 4.5
                             ANTARES PHARMA, INC.

                2001 INCENTIVE STOCK OPTION PLAN FOR EMPLOYEES

Section 1.  Purpose.

     The purpose of this 2001 Incentive Stock Option Plan for Employees (the
"Plan") is to promote the interests of Antares Pharma, Inc. (the "Company") and
its shareholders by aiding the Company in attracting and retaining employees
capable of contributing to the growth and success of the Company, and by
offering such employees an opportunity to acquire a proprietary interest in the
Company, thereby providing them with incentives to put forth maximum efforts for
the success of the Company's business and aligning the interests of such
employees with those of the Company's shareholders.

Section 2.  Definitions.

     As used in the Plan, the following terms shall have the meaning set forth
below:

     (a) "Affiliate" shall mean (i) any entity that, directly or indirectly
through one or more intermediaries, is controlled by the Company and (ii) any
entity in which the Company has a significant equity interest, in each case as
determined by the Board of Directors.

     (b) "Award" shall mean any Option granted under the Plan.

     (c) "Award Agreement" shall mean any written agreement, contract or other
instrument or document evidencing any Award granted under the Plan.

     (d) "Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time, and any regulations promulgated thereunder.

     (e) "Committee" shall mean the a committee of the Board of Directors of the
Company to whom the powers and duties of such Board of Directors under the Plan
may be delegated pursuant to Section 3(b) hereof, which shall consist of members
appointed from time to time by the Board of Directors and shall be composed
solely of two or more directors, each of whom is an "outside director" within
the meaning of Section 162(m) of the Code to the extent required by such
Section.

     (f) "Company" shall mean Antares Pharma, Inc., a Minnesota corporation, and
any successor corporation.

     (g) "Eligible Person" shall mean any employee or officer providing services
to the Company or any Affiliate.

     (h) "Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

     (i) "Fair Market Value" shall mean, with respect to any property
(including, without limitation, any Shares or other securities), the fair market
value of such property determined by such methods or procedures as the Board of
Directors shall establish in good faith from time to time. Where there is a
public market for the Shares, the fair market value per Share on a given date
shall be the closing price of a Share in the over-the-counter market on such
date, as reported in The Wall Street Journal (or, if not so reported, as
otherwise reported by The Nasdaq Stock Market ("Nasdaq")) or, in the event the
Shares are traded on the Nasdaq National Market, SmallCap Market or listed on a
stock
<PAGE>

exchange, the fair market value per Share shall be the closing price on such
system or exchange on such date, as reported in The Wall Street Journal; if such
market or exchange is not open for trading on such date, the Fair Market Value
shall be determined as of the closest preceding date when such market or
exchange was open for trading.

     (j) "Incentive Stock Option" shall mean an option granted under Section
6(a) of the Plan that is intended to meet the requirements of Section 422 of the
Code or any successor provision.

     (k) "Non-Qualified Stock Option" shall mean an option granted under Section
6(a) of the Plan that is not intended to meet the requirements of Section 422 of
the Code or any successor provision.

     (l) "Option" shall mean an Incentive Stock Option or a Non-Qualified Stock
Option.

     (m) "Participant" shall mean an Eligible Person whom the Board of Directors
designates to receive an Award under the Plan.

     (n) "Person" shall mean any individual, corporation, partnership,
association or trust.

     (o) "Rule 16b-3" shall mean Rule 16b-3 promulgated by the Securities and
Exchange Commission under the Exchange Act or any successor rule or regulation.

     (p) "Shares" shall mean shares of Common Stock, $.01 par value, of the
Company or such other securities or property as may become subject to Awards
pursuant to an adjustment made under Section 4(c) of the Plan.

Section 3.  Administration.

     (a) Administration by the Board of Directors.  The Plan shall be
         ----------------------------------------
administered by the Board of Directors of the Company, with or without the
advice of a Committee. Subject to the express provisions of the Plan and to
applicable law, the Board of Directors shall have full power and authority to:
(i) designate Participants; (ii) determine the type or types of Awards to be
granted to each Participants under the Plan; (iii) determine the number of
Shares to be covered by each Award; (iv) determine the terms and conditions of
any Award or Award Agreement; (v) amend the terms and conditions of any Award or
Award Agreement and accelerate the exercisability of Options; (vi) interpret and
administer the Plan and any instrument or agreement relating to, or Award made
under, the Plan; (vii) establish, amend, suspend or waive such rules and
regulations and appoint such agents as it shall deem appropriate for the proper
administration of the Plan; and (viii) make any other determination and take any
other action that the Board of Directors deems necessary or desirable for the
administration of the Plan. Unless otherwise expressly provided in the Plan, all
designations, determinations, interpretations and other decisions under or with
respect to the Plan or any Award shall be within the sole discretion of the
Board of Directors, may be made at any time and shall be final, conclusive and
binding upon any Participant, any holder or beneficiary of any Award and any
employee of the Company or any Affiliate.

     (b) Delegation to Committee.  Notwithstanding anything to the contrary
         -----------------------
contained herein, the Board of Directors may, at any time and from time to time,
delegate its powers and duties hereunder to a Committee solely for purposes of
complying with Section 162(m) of the Code.

     (c) References to Board of Directors.  Unless stated to the contrary, as
         --------------------------------
used herein, references to the Board of Directors shall mean the Committee to
whom the Board of Directors has delegated its powers and duties in the event
such powers and duties have been so delegated.
<PAGE>

Section 4.  Shares Available for Awards.

     (a) Shares Available.  Subject to adjustment as provided in Section 4(c),
         ----------------
the aggregate number of Shares which may be issued under all Awards under the
Plan shall be 600,000. Shares to be issued under the Plan shall be authorized
but previously unissued. If any Shares covered by an Award or to which an Award
relates are not purchased or are forfeited, or if an Award otherwise terminates
without delivery of any Shares, then the number of Shares counted against the
aggregate number of Shares available under the Plan with respect to such Award,
to the extent of any such forfeiture or termination, shall again be available
for granting Awards under the Plan.

     (b) Accounting for Awards.  For purpose of this Section 4, if an Award
         ---------------------
entitles the holder thereof to purchase Shares, the number of Shares covered by
such Award shall be counted on the date of grant of such Award against the
aggregate number of Shares available for granting Awards under the Plan.

     (c) Adjustments.  In the event that the Board of Directors shall determine
         -----------
that any dividend or other distribution (whether in the form of cash, Shares,
other securities or other property), recapitalization, stock split, reverse
stock split, reorganization, merger, consolidation, split-up, spin-off,
combination, repurchase or exchange of Shares or other securities of the
Company, issuance of warrants or other rights to purchase Shares or other
securities of the Company or other similar corporate transaction or event
affects the Shares such that an adjustment is determined by the Board of
Directors to be appropriate in order to prevent dilution or enlargement of the
benefits or potential benefits intended to be made available under the Plan,
then the Board of Directors shall, in such manner as it may deem equitable,
adjust any or all of (i) the number and type of Shares (or other securities or
other property) which thereafter may be made the subject of Awards; (ii) the
number and type of Shares (or other securities or other property) subject to
outstanding Awards and (iii) the purchase or exercise price with respect to any
Award; provided, however, that the number of Shares covered by any Award or to
       --------  -------
which such Award relates shall always be a whole number.

Section 5.  Eligibility.

     Any employee, including any employee who is an officer of the Company or
any Affiliate, shall be eligible to be designated a Participant. In determining
which Eligible Persons shall receive an Award and the terms of any Award, the
Board of Directors may take into account the nature of the services rendered by
the respective Eligible Persons, their present and potential contributions to
the success of the Company or such other factors as the Board of Directors, in
its discretion, shall deem relevant. Notwithstanding the foregoing, an Incentive
Stock Option may only be granted to full or part-time employees (which term as
used herein includes, without limitation, officers who are also employees), and
an Incentive Stock Option shall not be granted to an employee of an Affiliate
unless such Affiliate is also a "subsidiary corporation" of the Company within
the meaning of Section 424(f) of the Code or any successor provision.

Section 6.  Awards.

     (a) Options.  The Board of Directors is hereby authorized to grant Options
         -------
to Participants with the following terms and conditions and with such additional
terms and conditions not inconsistent with the provisions of the Plan as the
Board of Directors shall determine:

         (i)     Exercise Price.  The purchase price per Share purchasable under
                 --------------
an Option shall be determined by the Board of Directors; provided, however, that
                                                         --------  -------
such price shall not be less than 100% of the Fair Market Value of a Share on
the date of grant of such Option.
<PAGE>

         (ii)  Option Term.  The term of each Option shall be fixed by the Board
               -----------
of Directors; provided, however, that the term of an Incentive Stock Option may
              --------  -------
not extend more than ten years from the date of grant of such Incentive Stock
Option.  Provided, further, that the Board of Directors shall be under no duty
         --------  -------
to provide terms of like duration for Awards granted under the Plan.

         (iii) Time and Method of Exercise.  The Board of Directors shall
               ---------------------------
determine the time or times at which an Option may be exercised in whole or in
part and the method or methods by which, and the form or forms (including,
without limitation, cash, previously owned Shares, Shares issuable upon exercise
of the Award or any combination thereof, having a Fair Market Value on the
exercise date equal to the relevant exercise price) in which, payment of the
exercise price with respect thereto may be made or deemed to have been made.

         (iv)  Certain Options to be Treated as Non-Qualified Stock Options.
               ------------------------------------------------------------
If the aggregate Fair Market Value of all Shares subject to Incentive Stock
Options granted to a Participant under all plans of the Company and its parent
and subsidiary corporations (as described in Section 422(d) of the Code) that
are exercisable for the first time during any calendar year exceeds $100,000 at
the time an Option is granted to such Participant, then such Option shall be
treated as an Option that does not qualify as an Incentive Stock Option.

         (v)   Ten Percent Shareholder Rule.  Notwithstanding any other
               ----------------------------
provision in the Plan, if at the time an Option is otherwise to be granted
pursuant to the Plan to a Participant who owns, directly or indirectly (within
the meaning of Section 424(d) of the Code), Common Stock of the Company
possessing more than 10% of the total combined voting power of all classes of
stock of the Company or its parent or any subsidiary, then any Incentive Stock
Option to be granted to such Participant pursuant to the Plan shall satisfy the
requirements of Section 422(c)(5) of the Code, and the exercise price of such
Option shall be not less than 110% of the Fair Market Value of the Shares
covered, and such Option by its terms shall not be exercisable after the
expiration of five years from the date such Option is granted.

         (vi)  Option Limitations Under the Plan.  No Eligible Person who is am
               ---------------------------------
employee of the Company at the time of grant may be granted any Option covering
more than 500,000 Shares in the aggregate in any calendar year. The foregoing
annual limitation shall apply to the extent required by Section 162(m) of the
Code to qualify the Option as "qualified performance-based compensation" within
the meaning of such Section.

         (vii) Foreign Jurisdictions.  The Board of Directors may adopt, amend,
               ---------------------
and terminate such arrangements, not inconsistent with the intent of the Plan,
as it may deem necessary or desirable to make available tax or other benefits of
the laws of any foreign jurisdiction to Eligible Persons who are subject to such
laws and who receive Options under the Plan.

     (b) General.
         -------

         (i)   No Cash Consideration for Awards.  Awards shall be granted for no
               --------------------------------
cash consideration or for such minimal cash consideration as may be required by
applicable law.

         (ii)  Grant of Additional Awards.  An Eligible Person who has been
               --------------------------
granted an Award under this Plan may be granted additional Awards under the Plan
if the Board of Directors shall so determine.

         (iii) Limits on Transfer of Awards.  No Award and no right under any
               ----------------------------
such Award shall be transferable by a Participant otherwise than by will or by
the laws of descent and distribution.  No
<PAGE>

Award or right under any such Award may be pledged, alienated, attached or
otherwise encumbered, and any purported pledge, alienation, attachment or
encumbrance thereof shall be void and unenforceable against the Company or any
Affiliate.

         (iv)  Restrictions; Securities Exchange Listing.  All certificates for
               -----------------------------------------
Shares or other securities delivered under the Plan pursuant to any Award or the
exercise thereof shall be subject to such stop transfer orders and other
restrictions as the Board of Directors may deem advisable under the Plan or the
rules, regulations and other requirements of the Securities and Exchange
Commission and any applicable federal or state securities laws, and the Board of
Directors may cause a legend or legends to be placed on any such certificate to
make appropriate reference to such restrictions. If the Shares or other
securities are quoted on Nasdaq, traded on the Nasdaq National Market, SmallCap
Market or listed on a stock exchange, the Company shall not be required to
deliver any Shares or other securities covered by an Award unless and until such
Shares or other securities have been admitted for quotation or trading the
Nasdaq National Market, SmallCap Market or such stock exchange.

Section 7.  Income Tax Withholding.

     In order to comply with all applicable federal or state income tax laws or
regulations, the Company may take such action as it deems appropriate to ensure
that all applicable federal or state payroll, withholding, income or other
taxes, all of which are and shall remain the sole and absolute responsibility of
a Participant, are withheld or collected from such Participant. In order to
assist a Participant in paying all or a portion of the federal and state taxes
to be withheld or collected upon exercise of an Award, the Board of Directors,
in its discretion and subject to such additional terms and conditions as it may
adopt, may permit the Participant to satisfy such tax obligation by (i) electing
to have the Company withhold a portion of the Shares otherwise to be delivered
upon exercise of such Award with a Fair Market Value equal to the amount of such
taxes or (ii) delivering to the Company Shares other than Shares issuable upon
exercise of such Award with a Fair Market Value equal to the amount of such
taxes. The election, if any, must be made on or before the date that the amount
of tax to be withheld is determined.

Section 8.  General Provisions.

     (a) No Rights to Awards.  No Eligible Person, Participant or other Person
         -------------------
shall have any claim to be granted any Award under the Plan, and there is no
obligation for uniformity of treatment of Eligible Persons, Participants or
holders or beneficiaries of Awards under the Plan. The terms and conditions of
Awards need not be the same with respect to any Participant or with respect to
different Participants.

     (b) Award Agreements.  No Participant will have rights under an Award
         ----------------
granted to such Participant unless and until an Award Agreement shall have been
duly executed on behalf of the Company and, if requested by the Company, signed
by the Participant.

     (c) No Limit on Other Compensation Arrangements.  Nothing contained in the
         -------------------------------------------
Plan shall prevent the Company or any Affiliate from adopting or continuing in
effect other or additional compensation arrangements, and such arrangements may
be either generally applicable or applicable only in specific cases.

     (d) No Right to Employment.  The grant of an Award shall not be construed
         ----------------------
as giving a Participant the right to be retained as an employee or director of
the Company or any Affiliate, nor will it affect in any way the right of the
Company or an Affiliate to terminate such employment or directorship at any
time, with or without cause. In addition, the Company or an Affiliate may at any
time dismiss a
<PAGE>

Participant from employment or directorship free from any liability or any claim
under the Plan, except as otherwise expressly provided in the Plan or in any
Award Agreement.

     (e) Governing Law.  The validity, construction and effect of the Plan or of
         -------------
any Award, and any rules and regulations relating to the Plan or any Award,
shall be determined in accordance with the laws of the State of Minnesota.

     (f) Severability.  If any provision of the Plan or any Award is or becomes
         ------------
or is deemed to be invalid, illegal or unenforceable in any jurisdiction or
would disqualify the Plan or any Award under any law deemed applicable by the
Board of Directors, such provision shall be construed or deemed amended to
conform to applicable law, or if it cannot be so construed or deemed amended
without, in the determination of the Board of Directors, materially altering the
purpose or intent of the Plan or the Award, such provision shall be stricken as
to such jurisdiction or Award, and the remainder of the Plan or any such Award
shall remain in full force and effect.

     (g) No Trust or Fund Created.  Neither the Plan nor any Award shall create
         ------------------------
or be construed to create a trust or separate fund of any kind or a fiduciary
relationship between the Company or any Affiliate and a Participant or any other
Person. To the extent that any Person acquires a right to receive payments from
the Company or any Affiliate pursuant to an Award, such right shall be no
greater than the right of any unsecured general creditor of the Company or any
Affiliate.

     (h) No Fractional Shares.  No fractional Shares shall be issued or
         --------------------
delivered pursuant to the Plan or any Award, and the Board of Directors shall
determine whether cash shall be paid in lieu of any fractional Shares or whether
such fractional Shares or any rights thereto shall be canceled, terminated or
otherwise eliminated.

     (i) Headings.  Headings are given to the Sections and subsections of the
         --------
Plan solely as a convenience to facilitate reference.  Such headings shall not
be deemed in any way material or relevant to the construction or interpretation
of the Plan or any provision thereof.

     (j) Other Benefits.  No compensation or benefit awarded to or realized by
         --------------
any Participant under the Plan shall be included for the purpose of computing
such Participant's compensation under any compensation-based retirement,
disability, or similar plan of the Company unless required by law or otherwise
provided by such other plan.

Section 9.  Amendment and Termination; Adjustments.

     Except to the extent prohibited by applicable law and unless otherwise
expressly provided in an Award Agreement or in the Plan:

     (a) Amendments to the Plan.  The Board of Directors of the Company may
         ----------------------
amend, alter, suspend, discontinue or terminate the Plan; provided, however,
                                                          --------  -------
that, notwithstanding any other provision of the Plan or any Award Agreement,
without the approval of the shareholders of the Company, no such amendment,
alteration, suspension, discontinuation or termination shall be made that,
absent such approval, would:

         (i)  violate the rules or regulations of Nasdaq National Market,
SmallCap market or any stock exchange that are applicable to the Company; or

         (ii) cause the Company to be unable, under the Code, to grant Incentive
Stock Options under the Plan.
<PAGE>

     (b) Amendments to Awards.  The Board of Directors may waive any conditions
         --------------------
or rights of the Company under any outstanding Award, prospectively or
retroactively. The Board of Directors may not amend, alter, suspend, discontinue
or terminate any outstanding Award, prospectively or retroactively, without the
consent of the Participant or holder or beneficiary thereof, except as otherwise
provided herein or in the Award Agreement.

     (c) Correction of Defects, Omissions and Inconsistencies.  The Board of
         ----------------------------------------------------
Directors may correct any defect, supply any omission or reconcile any
inconsistency in the Plan or any Award in the manner and to the extent it shall
deem desirable to carry the Plan into effect.

Section 10.  Effective Date; Term.

     (a) Effective Date.  The Plan shall be effective as of January 31, 2001
         --------------
(the "Effective Date"); provided, however, that if the Company's shareholders do
                        --------  -------
not approve the Plan at the next meeting of Shareholders, the Plan shall be null
and void and all Awards granted prior to the date of such Special Meeting shall
be of no force or effect, and provided further, that no Incentive Stock Option
may be granted before March 22, 2001, the date that the Plan was approved by the
Board.

     (b) Term.  Awards shall be granted under the Plan only during a 10-year
         ----
period beginning on the Effective Date.  Unless otherwise expressly provided in
the Plan or in an applicable Award Agreement, however, any Award theretofore
granted may extend beyond the end of such 10-year period, and the authority of
the Board of Directors provided for hereunder, shall extend beyond the
termination of the Plan.

Section 11.  Notice.

     All notices to the Company regarding the Plan shall be in writing,
effective as of actual receipt by the Company, and shall be sent to

     ANTARES PHARMA, INC.
     161 Cheshire Lane, Suite 100
     Plymouth, MN 55441
     Attn:  Chief Financial Officer