##### 





UNITED STATES
    SECURITIES AND EXCHANGE COMMISSIONWashington, D.C.
    20549
      Form 10-K
  þ

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED
    DECEMBER 31, 2007o

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
    SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD
    FROM          TO          .   Commission File
    No. 0-28298
      Onyx Pharmaceuticals,
    Inc.
 (Exact name of registrant as
    specified in its charter)
  Delaware(State or other jurisdiction
    of
    Incorporation or Organization)

94-3154463(I.R.S. Employer
    Identification No.)  2100 Powell Street
 Emeryville, California 94608
 (510) 597-6500
 (Address, including zip code,
    and telephone number,
 including area code, of
    registrants principal executive offices)
  Securities Registered Pursuant
    to Section 12(b) of the Act:
  Title of Each Class

Name of Each Exchange on Which RegisteredCommon Stock $0.001 par value

Nasdaq Global Market   Securities Registered Pursuant to Section 12(g) of the
    Act: None
      þ o
  o þ
  þ o
  Regulation S-K Form 10-K Form 10-K. o
   12b-2
  Large
    accelerated
    filer þ
    Accelerated
    filer o
    Non-accelerated
    filer o
    Smaller
    reporting
    company o (Do
    not check if a smaller reporting company)  Rule 12b-2 o þ




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##### 





DOCUMENTS INCORPORATED BY REFERENCE
  Form 10-K.
  *
    
    Excludes 21,919,929 shares of Common Stock held by
    directors, officers and stockholders whose beneficial ownership
    exceeds 5% of the Registrants Common Stock outstanding.
    The number of shares owned by stockholders whose beneficial
    ownership exceeds 5% was determined based upon information
    supplied by such persons and upon Schedules 13D and 13G, if any,
    filed with the SEC. Exclusion of shares held by any person
    should not be construed to indicate that such person possesses
    the power, direct or indirect, to direct or cause the direction
    of the management or policies of the Registrant, that such
    person is controlled by or under common control with the
    Registrant, or that such persons are affiliates for any other
    purpose. 2




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##### 



PART I.
  This Annual Report on
    Form 10-K
    contains forward-looking statements within the meaning of
    Section 27A of the Securities Act of 1933 and
    Section 21E of the Securities Exchange Act of 1934. These
    statements involve known and unknown risks, uncertainties and
    other factors that may cause our or our industrys results,
    levels of activity, or achievements to differ significantly and
    materially from that expressed or implied by such
    forward-looking statements. These factors include, among others,
    those set forth in Item 1A Risk Factors and
    elsewhere in this Annual Report on
    Form 10-K.
    In some cases, you can identify forward-looking statements by
    terminology such as may, will,
    should, intend, expect,
    plan, anticipate, believe,
    estimate, predict,
    potential, or continue, or the negative
    of such terms or other comparable terminology.
  Although we believe that the expectations reflected in the
    forward-looking statements are reasonable, we cannot guarantee
    future results, events, levels of activity, performance or
    achievements. We do not assume responsibility for the accuracy
    and completeness of the forward-looking statements. We do not
    intend to update any of the forward-looking statements after the
    date of this Annual Report on
    Form 10-K
    to conform these statements to actual results, unless required
    by law.
  Unless the context otherwise requires, all references to
    the Company, Onyx, we,
    our, and us in this Annual Report on
    Form 10-K
    refer to Onyx Pharmaceuticals, Inc.
  Item 1.
    Business  Overview
  changing the way cancer is
    treated tm ®
  Products
  Nexavar
   3




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##### 



CurrentProduct/Program

Indication

StatusNexavar
    (sorafenib) tablets

Advanced kidney cancer

Approved in United States, European Union and other territories
    worldwideLiver cancer

Approved in the United States, European Union and other
    territories worldwideCombination trials for non-small cell lung cancer

Phase 3Combination trial for metastatic melanoma

Phase 3Combination trials for breast, kidney, and liver cancers, as
    well as, metastatic melanoma

Phase 2Single-agent trials for breast, non-small cell lung and other
    cancers

Phase 2Combination trials with standard chemotherapies for melanoma,
    colorectal, non-small cell lung, ovarian and other cancers

Phase 2 and 1b ExtensionAdditional combination trials with other anticancer agents

Phase 1bPD 332991
    (licensed to Pfizer)

Multiple cancer types

Phase 1   Commercialization
    Status
  ®
  Development
    Strategy
   4




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##### 



Clinical
    Trials
    Kidney
    Cancer Program
  Phase 3 Trial.
    Phase 2 Trial.
  Liver
    Cancer Program
  Phase 3 Trial.
      Phase 3 Trial.
 5




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##### 



Phase 2 Trials. time-to-tumor
    Lung
    Cancer Program
  Phase 3 Trial.
  Phase 3 Trial.
  Phase 1/Phase 2 Trials.
 6




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##### 



Metastatic
    Melanoma Program
  Phase 3 Trial.
   Phase 3 Trial.
  Phase 2 Trial.
  Breast
    Cancer Program
    Phase 2 Studies.
     7




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##### 



and/or
    Early
    Stage Clinical Development
    Licensed
    Product Candidates
  Cell
    Cycle Program
    Virus
    Platform
    Collaboration
    with Bayer
   8




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##### 



Research
    and Development
      Marketing
    and Sales
  point-of-contact
 9




---



##### 



Manufacturing
      Form 10-K.
  Patents
    and Proprietary Rights
       10




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##### 



Government
    Regulation
      
    preclinical studies;
    the submission to the FDA of an IND that must become effective
    before human clinical trials may commence;
    adequate and well-controlled human clinical trials to establish
    the safety and efficacy of the product candidate;
    the submission of an NDA to the FDA; and
    FDA approval of the NDA, including inspection and approval of
    the product manufacturing facility.         11




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##### 



Form 10-K.
  Competition
       12




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##### 



and/or
  Form 10-K.
  Employees
    Company
    Information
  (510) 597-6500. http://www.onyx-pharm.com
  Available
    Information
  Form 10-K, Form 10-Q, Form 8-K Form 10-K 1-800-SEC-0330. http://www.sec.gov.
  Code of
    Ethics
  http://www.onyx-pharm.com
  Item 1A.
    Risk
    Factors  You should carefully consider the risks described below,
    together with all of the other information included in this
    report, in considering our business and prospects. The risks and
    uncertainties described below contain forward-looking
    statements, and our actual results may differ materially from
    those discussed here. Additional risks and
 13




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##### 



uncertainties not presently known to us or that we currently
    deem immaterial also may impair our business operations. Each of
    these risk factors could adversely affect our business,
    operating results and financial condition, as well as adversely
    affect the value of an investment in our common stock.
  Nexavar®
    (sorafenib) tablets is our only product, and we do not have any
    other product candidates in Phase 2 or Phase 3 clinical
    development. If Nexavar is not commercially successful, we may
    be unable to develop and commercialize alternative product
    candidates and our business would fail.
    There are competing therapies approved and in development
    for the treatment of advanced kidney cancer. We expect the
    number of approved therapies to increase, which could harm the
    prospects for Nexavar in advanced kidney cancer.
             14




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##### 



Although Nexavar has been approved in the United States,
    European Union and other territories for the treatment of
    patients with liver cancer, adoption may be slow or limited for
    a variety of reasons including the geographic distribution of
    the patient population, the current treatment paradigm for liver
    cancer patients and the underlying liver disease present in most
    liver cancer patients. If Nexavar is not broadly adopted for the
    treatment of liver cancer, our business would be harmed.
    If our ongoing and planned clinical trials fail to
    demonstrate that Nexavar is safe and effective or we are unable
    to obtain necessary regulatory approvals, we will be unable to
    expand the commercial market for Nexavar and our business may
    fail.
         15




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##### 



We are dependent upon our collaborative relationship with
    Bayer to manufacture and to further develop and commercialize
    Nexavar. There may be circumstances that delay or prevent the
    development and commercialization of Nexavar.
      
    adverse decisions by Bayer regarding the amount and timing of
    resource expenditures for the development and commercialization
    of Nexavar;
    possible disagreements as to development plans, including
    clinical trials or regulatory approval strategy;
    the right of Bayer to terminate its collaboration agreement with
    us on limited notice and for reasons outside our control;
    loss of significant rights if we fail to meet our obligations
    under the collaboration agreement;
    withdrawal of support by Bayer following the development or
    acquisition by it of competing products; and
    possible disagreements with Bayer regarding the collaboration
    agreement or ownership of proprietary rights.      We face intense competition and rapid technological
    change, and many of our competitors have substantially greater
    resources than we have.
   16




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##### 




    developing products;
    undertaking preclinical testing and human clinical trials;
    obtaining FDA and other regulatory approvals of
    products; and
    manufacturing and marketing products.          Our operating results are unpredictable and may fluctuate.
    If our operating results are below the expectations of
    securities analysts or investors, the trading price of our stock
    could decline.
   17




---



##### 



The market may not accept our products and pharmaceutical
    pricing and reimbursement pressures may reduce
    profitability.
  and/or not-for-profit
      
    rate of adoption by healthcare practitioners;
    treatment guidelines issued by government and non-government
    agencies;
    types of cancer for which the product is approved;
    rate of a products acceptance by the target population;
    timing of market entry relative to competitive products;
    availability of alternative therapies;
    price of our product relative to alternative therapies;
    extent of marketing efforts by us and third-party distributors
    or agents retained by us; and
    side effects or unfavorable publicity concerning our products or
    similar products. 18




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##### 



Our
    clinical trials could take longer to complete than we project or
    may not be completed at all.
      If serious adverse side effects are associated with
    Nexavar, approval for Nexavar could be revoked, sales of Nexavar
    could decline, and we may be unable to develop Nexavar as a
    treatment for other types of cancer.
  and/or
  We are subject to extensive government regulation, which
    can be costly, time consuming and subject us to unanticipated
    delays.
     19




---



##### 



We are
    dependent on the efforts of Bayer to market and promote
    Nexavar.
          We are
    dependent on the efforts of and funding by Bayer for the
    development Nexavar.
   20




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##### 



We do not have manufacturing expertise or capabilities and
    are dependent on Bayer to fulfill our manufacturing needs, which
    could result in lost sales and the delay of clinical trials or
    regulatory approval.
  scale-up,
  If Bayers business strategy changes, it may
    adversely affect our collaborative relationship.
    We have a history of losses, and we may continue to incur
    losses.
      If we lose our key employees and consultants or are unable
    to attract or retain qualified personnel, our business could
    suffer.
    We may need additional funds, and our future access to
    capital is uncertain.
   21




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##### 




    revenue from our product sales;
    global product development and commercialization activities;
    the cost involved in enforcing patent claims against third
    parties and defending claims by third parties;
    the costs associated with acquisitions or licenses of additional
    products;
    competing technological and market developments; and
    repayment of our of milestone-based advances.      While Nexavar has received marketing approvals in several
    countries outside of the United States, it has not been approved
    in all of these foreign countries and may receive limited
    marketing approval or may be denied marketing approval in
    additional countries.
          22




---



##### 




    not provide us with accurate or timely information regarding
    their inventories, the number of patients who are using Nexavar
    or complaints about Nexavar;
    not effectively sell or support Nexavar;
    reduce their efforts or discontinue to sell or support Nexavar;
    not devote the resources necessary to sell Nexavar in the
    volumes and within the time frames that we expect;
    be unable to satisfy financial obligations to us or
    others; and
    cease operations.    We or Bayer may not be able to protect our intellectual
    property, which gives us the power to exclude third parties from
    using Nexavar, or we may not be able to operate our business
    without infringing upon the intellectual property rights of
    others.
    
    obtain patents;
    license technology rights from others;
    protect trade secrets;
    operate without infringing upon the proprietary rights of
    others; and
    prevent others from infringing on our proprietary rights.       23




---



##### 



and/or
  We may incur significant liability if it is determined
    that we are promoting the off-label use of drugs or
    are otherwise found in violation of federal and state
    regulations in the United States or elsewhere.
      We face product liability risks and may not be able to
    obtain adequate insurance.
     24




---



##### 




    decreased demand for a product;
    injury to our reputation;
    withdrawal of clinical trial volunteers; and
    loss of revenues.    If we do not receive timely and accurate financial and
    market information from Bayer regarding the development and sale
    of Nexavar, we may be unable to accurately report our results of
    operations.
    Provisions in our collaboration agreement with Bayer may
    prevent or delay a change in control.
    Accounting pronouncements may affect our future financial
    position and results of operations.
    Our stock price is volatile.
    
    fluctuations in our results of operations; 25




---



##### 




    interim or final results of, or speculation about, clinical
    trials of Nexavar, such as the announcement that we and Bayer
    had stopped the Phase 3 clinical trial of Nexavar in combination
    with carboplatin and paclitaxel in patients with NSCLC;
    decision by regulatory agencies, or changes in regulatory
    requirements;
    ability to accrue patients into clinical trials;
    developments in our relationship with Bayer;
    public concern as to the safety and efficacy of our product
    candidates;
    changes in healthcare reimbursement policies;
    announcements by us or our competitors of technological
    innovations or new commercial therapeutic products;
    government regulation;
    developments in patent or other proprietary rights or litigation
    brought against us;
    sales by us of our common stock or debt securities, including
    sales under our committed equity financing facility arrangement
    with Azimuth;
    foreign currency fluctuations, which would affect our share of
    collaboration profits or losses; and
    general market conditions.  Existing stockholders have significant influence over
    us.
      A portion of our short-term investment portfolio is
    invested in auction rate securities, and if an auction fails for
    amounts we have invested, our investment will not be liquid. If
    the issuer of an auction rate security that we hold is unable to
    successfully close future auctions and their credit rating
    deteriorates, we may be required to reclassify these securities
    to long term assets and adjust the carrying value of our
    investment through an impairment charge.
    We are at risk of securities class action litigation due
    to our expected stock price volatility.
   26




---



##### 



non-small
  Our operating results could be adversely affected by
    product sales occurring outside the United States and
    fluctuations in the value of the United States dollar against
    foreign currencies.
    Provisions in Delaware law, our charter and executive
    change of control agreements we have entered into may prevent or
    delay a change of control.
    
    the board of directors approved the transaction where the
    stockholder acquired 15% or more of the corporations stock;
    after the transaction in which the stockholder acquired 15% or
    more of the corporations stock, the stockholder owned at
    least 85% of the corporations outstanding voting stock,
    excluding shares owned by directors, officers and employee stock
    plans in which employee participants do not have the right to
    determine confidentially whether shares held under the plan will
    be tendered in a tender or exchange offer; or
    on or after this date, the merger or sale is approved by the
    board of directors and the holders of at least two-thirds of the
    outstanding voting stock that is not owned by the stockholder.      
    our board is classified into three classes of directors as
    nearly equal in size as possible with staggered three-year terms;
    the authority of our board to issue up to 5,000,000 shares
    of preferred stock and to determine the price, rights,
    preferences and privileges of these shares, without stockholder
    approval;
    all stockholder actions must be effected at a duly called
    meeting of stockholders and not by written consent; 27




---



##### 




    special meetings of the stockholders may be called only by the
    chairman of the board, the chief executive officer, the board or
    10% or more of the stockholders entitled to vote at the
    meeting; and
    no cumulative voting.      Item 1B.
    Unresolved
    Staff Comments    Item 2.
    Properties      Item 3.
    Legal
    Proceedings    Item 4.
    Submission
    of Matters to a Vote of Securities Holders   28




---



##### 



PART II.
  Item 5.
    Market
    for Registrants Common Equity, Related Stockholder Matters
    and Issuer Purchases of Equity Securities    Common Stock2007


2006High


Low


High


LowFirst Quarter

$
29.03


$
10.74


$
29.10


$
25.82Second Quarter


33.93



25.25



25.29



14.67Third Quarter


44.73



26.77



17.29



12.87Fourth Quarter


59.50



41.55



19.60



10.44     Stock
    Performance Graph
    COMPARISON
    OF 5 YEAR CUMULATIVE TOTAL RETURN* Among
    ONYX Pharmaceuticals, Inc., The NASDAQ Composite Index
    And The NASDAQ Pharmaceutical Index
  
  Holders
   29




---



##### 



Dividends
    Recent
    Sales of Unregistered Securities
    Issuer
    Purchases of Equity Securities
    Item 6.
    Selected
    Financial Data      Year Ended December 31,2007


2006


2005


2004


2003(In thousands, except per share data)Statement of Operations Data:Total Revenue

$
-


$
250


$
1,000


$
500


$
-Operating expenses:Net expense due to (from) unconsolidated joint business


(32,536
)


23,915



-



-



-Research and development


25,413



30,980



63,120



35,846



32,059Selling, general and administrative


60,546



50,019



39,671



14,316



7,939Restructuring


-



-



-



258



5,530Loss from operations


(53,423
)


(104,664
)


(101,791
)


(49,920
)


(45,528
)Interest and other income and expense, net


19,256



11,983



6,617



3,164



559Net loss

$
(34,167
)

$
(92,681
)

$
(95,174
)

$
(46,756
)

$
(44,969
)Basic and diluted net loss per share

$
(0.67
)

$
(2.20
)

$
(2.64
)

$
(1.36
)

$
(1.73
)Shares used in computing basic and diluted net loss per share


51,177



42,170



36,039



34,342



25,953   30




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##### 



December 31,2007


2006


2005


2004


2003(In thousands)Balance Sheet Data:Cash, cash equivalents, and marketable securities

$
469,650


$
271,403


$
284,680


$
209,624


$
105,400Total assets


484,083



286,246



294,665



215,546



109,138Working capital


469,215



256,699



241,678



197,873



92,826Advance from collaboration partner


39,234



40,000



30,000



20,000



20,000Accumulated deficit


(472,658
)


(438,491
)


(345,810
)


(250,636
)


(203,880
)Total stockholders equity


432,237



222,780



223,240



179,988



73,519   Item 7.
    Managements
    Discussion and Analysis of Financial Condition and Results of
    Operations  The following Managements Discussion and Analysis of
    Financial Condition and Results of Operations contains
    forward-looking statements that involve risks and uncertainties.
    We use words such as may, will,
    expect, anticipate,
    estimate, intend, plan,
    predict, potential, believe,
    should and similar expressions to identify
    forward-looking statements. These statements appearing
    throughout our
    10-K are
    statements regarding our intent, belief, or current
    expectations, primarily regarding our operations. You should not
    place undue reliance on these forward-looking statements, which
    apply only as of the date of this Annual Report on
    Form 10-K.
    Our actual results could differ materially from those
    anticipated in these forward-looking statements for many
    reasons, including those set forth under Business
    Item 1A Risk Factors and elsewhere in this
    Annual Report on
    Form 10-K.
  Overview
  changing the way cancer is
    treated tm . ®
  ®
   31




---



##### 



Form 10-K.
  Critical
    Accounting Policies and the Use of Estimates
      Net Expense due to (from) Unconsolidated Joint
    Business:
 32




---



##### 



non-United
  Stock Based-Compensation:
        Research and Development Expense:
 33




---



##### 



Results
    of Operations
  Years
    Ended December 31, 2007, 2006 and 2005
  Revenue.
  License Revenue.
  Net Expense due to (from) Unconsolidated Joint Business.
   34




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##### 



35




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##### 



Year Ended December 31,2007


2006(In thousands)Product revenue, net

$
371,736


$
164,994Combined cost of goods sold, distribution, selling,general and administrative


223,682



123,004Combined research and development


157,383



161,180Combined collaboration loss

$
9,329


$
119,190Onyxs share of collaboration loss

$
4,665


$
59,595Reimbursement of Onyxs direct development and marketing
    expenses


37,201



35,680Onyxs net expense due to (from) unconsolidated joint
    business

$
(32,536
)

$
23,915   Research and Development Expenses.
       36




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##### 



Form 10-K.
  Research andDevelopment ExpensesFor the Year EndedCollabo-

Phase of Development 



December 31,Product

Description

rator

Estimated Completion

2007

2006

2005(In millions)Nexavar (sorafenib) Tablets(1)

Small molecule inhibitor of tumor cell proliferation and
    angiogenesis, targeting RAF, VEGFR-2, PDGFR- ß, KIT, FLT-3,
    and RET.

Bayer

Phase 1  2004 
    Phase 2  Unknown
    Phase 3  Unknown

$
83.3
(2)

$
84.2
(2)

$
62.1Therapeutic Virus Programs(3)

Programs discontinued during the second quarter of 2003.






-



-



1.0Total Research and Development Expenses

$
83.3


$
84.2


$
63.1     (1)
    
    Aggregate research and development costs to-date through
    December 31, 2007 incurred by Onyx since fiscal year 2000
    for the Nexavar project is $302.3 million.(2)
    
    Costs reflected in this table represent our share of
    Bayers product development costs included in net expense
    due to (from) unconsolidated joint business and our direct
    research and development costs.(3)
    
    Costs in 2005 were comprised of: a.
    stock-based compensation for consultants;b.
    consulting fees for consultants retained in connection with the
    orderly wind-down of the virus programs and preservation of
    related assets for potential future divestiture or
    commercialization; andc.
    outside services related to stability testing and storage of
    virus product related to the programs.  Selling, General and Administrative
    Expenses.
     37




---



##### 



Interest Income.
    Other Income.
  Income
    Taxes
    Related
    Party Transactions
    Liquidity
    and Capital Resources
       38




---



##### 



Contractual
    Obligations and Commitments
    Payments Due by PeriodLess than

1-3

3-5

AfterContractual Obligations(1)

Total

1 Year

Years

Years

5 Years(In thousands)Operating leases, net of sublease income

$
5,990


$
1,020


$
2,230


$
2,424


$
316     (1)
    
    This table does not include any payments under research and
    development collaborations, as the amount and timing of such
    payments are not known. This table also does not include the
    obligation to repay the $39.2 million outstanding balance
    of creditable milestone-based payments, which we received from
    Bayer, 39




---



##### 



as of December 31, 2007 because the repayment of this
    amount is contingent upon the collaboration or Onyx generating
    profits after deducting certain contractually agreed upon
    expenditures.    Recently
    Issued Accounting Standards
      No. 07-3, (EITF 07-3), EITF 07-3 EITF 07-3
  No. 07-1, (EITF 07-1), EITF 07-1 07-1,
  Item 7A.
    Quantitative
    and Qualitative Disclosures about Market Risk  Interest
    Rate and Market Risk
   40




---



##### 



2007


2006Average








AverageFair Value


Interest





Fair Value


InterestMaturity


($ in millions)


Rate


Maturity


($ in millions)


RateCash equivalents, fixed rate


0  2 months


$
160.0



4.79
%


0  2 months


$
94.1



5.34
%Marketable securities, fixed rate


0  12 months


$
308.0



4.75
%


0  13 months


$
177.0



4.91
%       Item 8.
    Financial
    Statements and Supplementary Data  Form 10-K.
  Item 9.
    Changes
    In and Disagreements With Accountants on Accounting and
    Financial Disclosure    Item 9A.
    Controls
    and Procedures  Evaluation of Disclosure Controls and
    Procedures: Rules 13a-15(e) 15d-15(e) Form 10-K
 41




---



##### 



Managements Report on Internal Control over Financial
    Reporting: Rule 13a-15(f)
  Changes in Internal Control over Financial
    Reporting:
  Inherent Limitations on Effectiveness of
    Controls:
 42




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
                 
    43




---



##### 



Item 9B.
    Other
    information    PART III.
  Item 10.
    Directors
    and Executive Officers of the Registrant    Item 11.
    Executive
    Compensation    Item 12.
    Security
    Ownership of Certain Beneficial Owners and Management and
    Related Stockholder Matters    Securities
    Authorized for Issuance Under Equity Compensation Plans as of
    December 31, 2007
  Number of





Number of securitiessecurities to be





remaining available forissued upon exercise


Weighted-average


future issuance underof outstanding


exercise price of


equity compensation plansoptions, warrants


outstanding options,


(excluding securitiesand rights


warrants and rights


reflected in column a)Plan Category(1)

Column a


Column b


Column cEquity compensation plans approved by security holders


4,437,906


$
25.39



3,071,058
(2)     (1)
    
    We have no equity compensation plans not approved by security
    holders.(2)
    
    This amount includes 517,393 shares that remain available for
    purchase under our Employee Stock Purchase Plan. Under the 2005
    Plan, shares available for issuance should be reduced by one and
    three tenths (1.3) shares for each share of common stock
    available for issuance pursuant to a stock purchase award, stock
    bonus award, stock unit award or other stock award granted. With
    this adjustment, the total amount available for future issuance
    would be reduced to 2,481,751 shares.  Item 13.
    Certain
    Relationships and Related Transactions    Item 14.
    Principal
    Accountant Fees and Services     44




---



##### 



PART IV.
  Item 15.
    Exhibits,
    Financial Statement Schedules  (a)
    (1) Index
    to Financial Statements                (2)
    Financial
    Statement Schedules    (3)
    Exhibits  ExhibitNumber

Description of Document3
.1(1)

Restated Certificate of Incorporation of the Company.3
.2(20)

Amended and Restated Bylaws of the Company.3
.3(3)

Certificate of Amendment to Amended and Restated Certificate of
    Incorporation.3
.4(13)

Certificate of Amendment to Amended and Restated Certificate of
    Incorporation.4
.1(1)

Reference is made to Exhibits 3.1, 3.2, 3.3 and 3.4.4
.2(1)

Specimen Stock Certificate.10
.1(12)*

Collaboration Agreement between Bayer Corporation (formerly
    Miles, Inc.) and the Company dated April 22, 1994.10
.1(i)(12)*

Amendment to Collaboration Agreement between Bayer Corporation
    and the Company dated April 24, 1996.10
.1(ii)(12)*

Amendment to Collaboration Agreement between Bayer Corporation
    and the Company dated February 1, 1999.10
.2(8)*

Amended and restated Research, Development and Marketing
    Collaboration Agreement dated May 2, 1995 between the
    Company and Warner-Lambert Company.10
.2(i)(8)*

Research, Development and Marketing Collaboration Agreement
    dated July 31, 1997 between the Company and Warner-Lambert
    Company.10
.2(ii)(8)*

Amendment to the Amended and Restated Research, Development and
    Marketing Collaboration Agreement, dated December 15, 1997,
    between the Company and Warner-Lambert Company.10
.2(iii)(8)*

Second Amendment to the Amended and Restated Research,
    Development and Marketing Agreement between Warner-Lambert and
    the Company dated May 2, 1995.10
.2(iv)(8)*

Second Amendment to Research, Development and Marketing
    Collaboration Agreement between Warner-Lambert and the Company
    dated July 31, 1997.10
.2(v)(17)*

Amendment #3 to the Research, Development and Marketing
    Collaboration Agreement between the Company and Warner-Lambert
    dated August 6, 2001.10
.2(vi)(4)*

Amendment #3 to the Amended and Restated Research, Development
    and Marketing Collaboration Agreement between the Company and
    Warner-Lambert dated August 6, 2001. 45




---



##### 



ExhibitNumber

Description of Document10
.3(5)*

Technology Transfer Agreement dated April 24, 1992 between
    Chiron Corporation and the Company, as amended in the Chiron
    Onyx HPV Addendum dated December 2, 1992, in the Amendment
    dated February 1, 1994, in the Letter Agreement dated
    May 20, 1994 and in the Letter Agreement dated
    March 29, 1996.10
.4(1)+

Letter Agreement between Dr. Gregory Giotta and the Company
    dated May 26, 1995.10
.5(1)+

1996 Equity Incentive Plan.10
.6(1)+

1996 Non-Employee Directors Stock Option Plan.10
.7(20)+

1996 Employee Stock Purchase Plan.10
.8(1)+

Form of Indemnity Agreement to be signed by executive officers
    and directors of the Company.10
.9(10)+

Form of Executive Change in Control Severance Benefits Agreement.10
.10(2)*

Collaboration Agreement between the Company and Warner-Lambert
    Company dated October 13, 1999.10
.10(i)(4)*

Amendment #1 to the Collaboration Agreement between the Company
    and Warner-Lambert dated August 6, 2001.10
.10(ii)(7)*

Second Amendment to the Collaboration Agreement between the
    Company and Warner-Lambert Company dated September 16, 2002.10
.11(6)

Stock and Warrant Purchase Agreement between the Company and the
    investors dated May 6, 2002.10
.12(9)

Sublease between the Company and Siebel Systems dated
    August 5, 2004.10
.12(i)(18)

First Amendment to Sublease between the Company and Oracle USA
    Inc., dated November 3, 2006.10
.13(20)+

2005 Equity Incentive Plan.10
.13(i)(18)+

Form of Stock Option Agreement pursuant to the 2005 Equity
    Incentive Plan.10
.13(ii)(18)+

Form of Stock Option Agreement pursuant to the 2005 Equity
    Incentive Plan and the Non-Discretionary Grant Program for
    Directors.10
.14(11)*

United States Co-Promotion Agreement by and between the Company
    and Bayer Pharmaceuticals Corporation, dated March 6, 2006.10
.15(14)+

Letter Agreement between Laura A. Brege and the Company, dated
    May 19, 2006.10
.16(15)+

Letter Agreement between Gregory W. Schafer and the Company,
    dated July 7, 2006.10
.17(15)+

Form of Stock Bonus Award Grant Notice and Agreement between the
    Company and certain award recipients.10
.18(16)

Common Stock Purchase Agreement between the Company and Azimuth
    Opportunity Ltd., dated September 29, 2006.10
.19(19)+

Retirement Agreement between the Company and Edward F. Kenney,
    dated April 13, 2007.10
.20(19)+

2007 Bonus Plan Summary10
.21(21)+

Bonuses for Fiscal Year 2007 and Base Salaries for Fiscal Year
    2008 for Named Executive Officers.23
.1

Consent of Independent Registered Public Accounting Firm.24
.1

Power of Attorney. Reference is made to the signature page.31
.1

Certification of Principal Executive Officer required by
    Rule 13a-14(a)
    or
    Rule 15d-14(a).31
.2

Certification of Principal Financial Officer required by
    Rule 13a-14(a)
    or
    Rule 15d-14(a).32
.1

Certifications required by
    Rule 13a-14(b)
    or
    Rule 15d-14(b)and
    Section 1350 of Chapter 63 of Title 18 of the
    United States Code (18 U.S.C. 1350).     *
    
    Confidential treatment has been received for portions of this
    document.+
    
    Indicates management contract or compensatory plan or
    arrangement.(1)
    
    Filed as an exhibit to Onyxs Registration Statement on
    Form SB-2
    (No.
    333-3176-LA). 46




---



##### 



(2)
    
    Filed as an exhibit to Onyxs Current Report on
    Form 8-K
    filed on March 1, 2000.(3)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2000.(4)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2001.(5)
    
    Filed as an exhibit to Onyxs Annual Report on
    Form 10-K
    for the year ended December 31, 2001. The redactions to
    this agreement have been amended since its original filing in
    accordance with a request for extension of confidential
    treatment filed separately by the Company with the Securities
    and Exchange Commission.(6)
    
    Filed as an exhibit to Onyxs Registration Statement on
    Form S-3
    filed on June 5, 2002
    (No. 333-89850).(7)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2002.(8)
    
    Filed as an exhibit to Onyxs Annual Report on
    Form 10-K
    for the year ended December 31, 2002. The redactions to
    this agreement have been amended since its original filing in
    accordance with a request for extension of confidential
    treatment filed separately by the Company with the Securities
    and Exchange Commission.(9)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2004.(10)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2005.(11)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 2006.(12)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 2006. The redactions to
    this agreement have been amended since its original filing in
    accordance with a request for extension of confidential
    treatment filed separately by the Company with the Securities
    and Exchange Commission.(13)
    
    Filed as an exhibit to Onyxs Registration Statement on
    Form S-3
    (No.
    333-134565)
    filed on May 30, 2006.(14)
    
    Filed as an exhibit to the registrants Current Report on
    Form 8-K
    filed on June 12, 2006.(15)
    
    Filed as an exhibit to the registrants Current Report on
    Form 8-K
    filed on July 12, 2006.(16)
    
    Filed as an exhibit to Onyxs Current Report on
    Form 8-K
    filed on September 29, 2006.(17)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2006. The redactions to
    this agreement have been amended since its original filing in
    accordance with a request for extension of confidential
    treatment filed separately by the Company with the Securities
    and Exchange Commission.(18)
    
    Filed as an exhibit to Onyxs Annual Report on
    Form 10-K
    for the year ended December 31, 2006.(19)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 2007.(20)
    
    Filed as an exhibit to Onyxs Current Report on
    Form 8-K
    filed on May 25, 2007.(21)
    
    Filed as an exhibit to Onyxs Current Report on
    Form 8-K
    filed on February 8, 2008. 47




---



##### 



SIGNATURES
  Form 10-K
  Onyx pharmaceuticals,
    inc.
  By:
    /s/  Hollings
    C. Renton   Chairman of the Board,
 President and Chief Executive Officer
  POWER OF
    ATTORNEY
  Form 10-K,
    Signature

Title

Date/s/  HOLLINGS
    C. RENTONHollings
    C. Renton

Chairman of the Board, President and Chief Executive Officer
    (Principal Executive Officer)

February 28, 2008/s/  GREGORY
    W. SCHAFERGregory
    W. Schafer

Vice President and Chief Financial Officer (Principal Financial
    and Accounting Officer)

February 28, 2008/s/  PAUL
    GODDARDPaul
    Goddard, Ph.D.

Director

February 28, 2008Antonio
    Grillo-López, M.D.

Director/s/  MAGNUS
    LUNDBERGMagnus
    Lundberg

Director

February 28, 2008/s/  CORINNE
    LYLECorinne
    Lyle

Director

February 28, 2008/s/  WENDELL
    WIERENGAWendell
    Wierenga, Ph.D.

Director

February 28, 2008/s/  THOMAS
    G. WIGGANSThomas
    G. Wiggans

Director

February 28, 2008  48




---



##### 



REPORT OF
    INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
               
    49




---



##### 



ONYX
    PHARMACEUTICALS, INC.
  BALANCE
    SHEETS
  December 31,2007


2006(In thousands, except share and per share amounts)ASSETSCurrent assets:Cash and cash equivalents

$
161,653


$
94,413Short-term marketable securities


307,997



172,545Receivable from collaboration partner


4,702



9,281Prepaid expenses and other current assets


6,304



3,659Total current assets


480,656



279,898Long-term marketable securities


-



4,445Property and equipment, net


3,146



1,478Other assets


281



425Total assets

$
484,083


$
286,246LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable

$
271


$
297Payable to collaboration partner


-



8,391Accrued liabilities


2,065



2,927Accrued clinical trials and related expenses


3,323



8,263Accrued compensation


5,782



3,321Total current liabilities


11,441



23,199Advance from collaboration partner


39,234



40,000Deferred rent and lease incentives


1,171



267Commitments and contingencies (Notes 7 and 13)Stockholders equity:Preferred stock, $0.001 par value; 5,000,000 shares
    authorized; none issued and outstanding


-



-Common stock, $0.001 par value; 100,000,000 shares
    authorized; 55,324,887 and 45,913,370 shares issued and
    outstanding as of December 31, 2007 and 2006, respectively


56



46Additional paid-in capital


904,506



661,402Receivable from option exercises


(23
)


-Accumulated other comprehensive gain (loss)


356



(177
)Accumulated deficit


(472,658
)


(438,491
)Total stockholders equity


432,237



222,780Total liabilities and stockholders equity

$
484,083


$
286,246    50




---



##### 



ONYX
    PHARMACEUTICALS, INC.
  STATEMENTS
    OF OPERATIONS
  Year Ended December 31,2007


2006


2005(In thousands, except per share amounts)Total Revenue:

$
-


$
250


$
1,000Operating expenses:Net expense due to (from) unconsolidated joint business


(32,536
)


23,915Research and development


25,413



30,980



63,120Selling, general and administrative


60,546



50,019



39,671Total operating expenses


53,423



104,914



102,791Loss from operations


(53,423
)


(104,664
)


(101,791
)Interest income


19,256



11,983



6,242Other income


-



-



375Net loss

$
(34,167
)

$
(92,681
)

$
(95,174
)Basic and diluted net loss per share

$
(0.67
)

$
(2.20
)

$
(2.64
)Shares used in computing basic and diluted net loss per share


51,177



42,170



36,039    51




---



##### 



ONYX
    PHARMACEUTICALS, INC.
  STATEMENT
    OF STOCKHOLDERS EQUITY
  Receivable


AccumulatedFrom


OtherAdditional


Stock


Comprehensive





TotalCommon Stock


Paid-In


Option


Income


Accumulated


StockholdersShares


Amount


Capital


Exercises


(Loss)


Deficit


Equity(In thousands, except shares and per share amounts)Balances at December 31, 2004


35,266,667



35



430,966



-



(377
)


(250,636
)


179,988Exercise of stock options


152,093



-



1,177



(24
)


-



-



1,153Issuance of common stock in connection with follow-on public
    offering, net of issuance costs of $8,953


5,750,000



6



136,228



-



-



-



136,234Stock-based compensation, related to non-employee stock option
    grants


-



-



906



-



-



-



906Issuance of common stock pursuant to employee stock purchase plan


12,424



-



257



-



-



-



257Exercise of warrants


29,550



-



266



-



-



-



266Comprehensive loss:Change in unrealized gain (loss) on investments


-



-



-



-



(390
)


-



(390
)Net loss


-



-



-



-



-



(95,174
)


(95,174
)Comprehensive loss


























(95,564
)Balances at December 31, 2005


41,210,734



41



569,800



(24
)


(767
)


(345,810
)


223,240Exercise of stock options


347,287



-



2,520



24



-



-



2,544Issuance of common stock in connection with Azimuth common stock
    purchase agreement


4,326,098



5



74,353



-



-



-



74,358Stock-based compensation, related to stock option grants


-



-



13,957



-



-



-



13,957Issuance of common stock pursuant to employee stock purchase plan


22,584



-



602



-



-



-



602Vesting of restricted stock awards


6,667



-



170



-



-



-



170Comprehensive loss:Change in unrealized gain (loss) on investments


-



-



-



-



590



-



590Net loss


-



-



-



-



-



(92,681
)


(92,681
)Comprehensive loss


























(92,091
)Balances at December 31, 2006


45,913,370



46



661,402



-



(177
)


(438,491
)


222,780Exercise of stock options


1,477,661



1



21,909



(23
)


-



-



21,887Issuance of common stock in connection with Azimuth common stock
    purchase agreement


1,246,912



2



30,754



-



-



-



30,756Issuance of common stock in connection with follow-on public
    offering


6,600,000



7



174,149



-



-



-



174,156Stock-based compensation, related to stock option grants


-



-



14,073



-



-



-



14,073Issuance of common stock pursuant to employee stock purchase plan


73,611



-



954



-



-



-



954Vesting of restricted stock awards


13,333



-



1,265



-



-



-



1,265Comprehensive loss:Change in unrealized gain (loss) on investments


-



-



-



-



533



-



533Net loss


-



-



-



-



-



(34,167
)


(34,167
)Comprehensive loss


























(33,634
)Balances at December 31, 2007


55,324,887


$
56


$
904,506


$
(23
)

$
356


$
(472,658
)

$
432,237    52




---



##### 



ONYX
    PHARMACEUTICALS, INC.
  STATEMENTS
    OF CASH FLOWS
  Year Ended December 31,2007


2006


2005( In thousands)Cash flows from operating activities:Net loss

$
(34,167
)

$
(92,681
)

$
(95,174
)Adjustments to reconcile net loss to net cash used in operating
    activities:Depreciation and amortization


1,030



758



630Gain on investment


-



-



(375
)Gain on sale of property and equipment


-



-



(7
)Forgiveness of note receivable


(87
)


-



-Stock-based compensation


15,624



14,406



906Changes in operating assets and liabilities:Receivable from collaboration partner


4,579



(4,931
)


(3,321
)Prepaid expenses and other current assets


(2,710
)


352



(1,157
)Other assets


144



(190
)


34Accounts payable


(26
)


(284
)


(457
)Accrued liabilities


(862
)


1,851



(552
)Accrued clinical trials and related expenses


(4,940
)


2,696



5,567Payable to collaboration partner


(8,391
)


(22,432
)


19,303Accrued compensation


2,461



210



2,201Deferred lease incentives


904



-



-Accrued restructuring


-



-



(195
)Net cash used in operating activities


(26,441
)


(100,245
)


(72,597
)Cash flows from investing activities:Purchases of marketable securities


(499,470
)


(360,272
)


(336,645
)Maturities of marketable securities


368,996



422,488



233,020Proceeds from sale of Syrxx investment


-



-



750Capital expenditures


(2,698
)


(619
)


(624
)Notes receivable from related parties


152



(228
)


-Proceeds from sale of property and equipment


-



-



7Net cash provided by (used in) investing activities


(133,020
)


61,369



(103,492
)Cash flows from financing activities:Advance from (payment to) collaboration partner


(766
)


10,000



10,000Net proceeds from issuances of common stock


227,467



77,225



137,910Net cash provided by financing activities


226,701



87,225



147,910Net increase (decrease) in cash and cash equivalents


67,240



48,349



(28,179
)Cash and cash equivalents at beginning of period


94,413



46,064



74,243Cash and cash equivalents at end of period

$
161,653


$
94,413


$
46,064    53




---



##### 



ONYX
    PHARMACEUTICALS, INC.
  NOTES TO
    FINANCIAL STATEMENTS
 December 31,
    2007
  Note 1.
    Summary
    of Significant Accounting Policies  The
    Company
  changing the
    way cancer is
    treated tm
  ®
  Revenue
    Recognition
    Contract Revenue from Collaborations.
    Use of
    Estimates
    Net
    Expense due to (from) Unconsolidated Joint
    Business:
   54




---



##### 



non-United
  Research
    and Development
        Cash
    Equivalents and Marketable Securities
   55




---



##### 



Property
    and Equipment
    Impairment
    of Long-Lived Assets
    Stock-Based
    Compensation
  ,
     56




---



##### 



No. 96-18,
    Year EndedDecember 31,2005Risk-free interest rate


3.80
%Expected life


3.8 yearsExpected volatility


0.74Expected dividends


NoneWeighted average fair value of options at date of grant

$
13.55     Year Ended December 31,2005(In thousands, exceptper share amounts)Net loss  as reported

$
(95,174
)Deduct: Total stock-based employee compensation determined under
    the fair value based method for all awards, net of related tax
    effects


(13,333
)Pro forma net loss

$
(108,507
)Loss per share:Basic and diluted net loss per share  as reported

$
(2.64
)Basic and diluted net loss per share  pro forma

$
(3.01
)     Net
    Loss Per Share
   57




---



##### 



December 31,2007


2006


2005(In thousands)Stock options


4,438



5,335



3,806Stock warrants


9



9



9Restricted stock awards


180



33



4,627



5,377



3,815   Comprehensive
    Loss
    Concentration
    of Credit Risk and Significant Research and Development
    Collaborators
        Income
    Taxes
    Segment
    Reporting
    Recently
    Issued Accounting Standards
   58




---



##### 



No. 07-3, (EITF 07-3), EITF 07-3 EITF 07-3
  No. 07-1, (EITF 07-1), EITF 07-1 07-1,
  Note 2.
    Collaboration
    Agreements  Bayer
    Pharmaceuticals Corporation
     59




---



##### 



Warner-Lambert
    Company
    Note 3.
    Net
    Expense due to (from) Unconsolidated Joint Business       60




---



##### 



Year Ended December 31,2007


2006(in thousands)Onyxs share of collaboration loss

$
4,665


$
59,595Reimbursement of Onyxs direct development and marketing
    expenses


37,201



35,680Onyxs net expense due to (from) unconsolidated joint
    business

$
(32,536
)

$
23,915     Note 4.
    Marketable
    Securities   61




---



##### 



2007Adjusted


Unrealized


Unrealized


EstimatedCost


Gains


Losses


Fair Value(In thousands)Agency bond investments:Maturing within 1 year

$
143,896


$
354


$
(13
)

$
144,237Total agency bond investments


143,896



354



(13
)


144,237Corporate debt investments:Maturing within 1 year


163,745



16



(1
)


163,760Total corporate investments


163,745



16



(1
)


163,760Total available-for-sale marketable securities

$
307,641


$
370


$
(14
)

$
307,997   2006Adjusted


Unrealized


Unrealized


EstimatedCost


Gains


Losses


Fair Value(In thousands)U.S. government investments:Maturing within 1 year

$
15,195


$
-


$
(57
)

$
15,138Maturing between 1 and 2 years


-



-



-



-Total government investments


15,195



-



(57
)


15,138Agency bond investments:Maturing within 1 year


41,663



1



(22
)


41,642Maturing between 1 and 2 years


9,996



-



(8
)


9,988Total agency bond investments


51,659



1



(30
)


51,630Corporate debt investments:Maturing within 1 year


105,853



1



(77
)


105,777Maturing between 1 and 2 years


4,460



-



(15
)


4,445Total corporate investments


110,313



1



(92
)


110,222Total available-for-sale marketable securities

$
177,167


$
2


$
(179
)

$
176,990      62




---



##### 



Note 5.
    Property
    and Equipment    December 31,2007


2006(In thousands)Computers, machinery and equipment

$
3,684


$
2,279Furniture and fixtures


620



446Leasehold improvements


1,868



734Construction in progress


-



156,172



3,474Less accumulated depreciation and amortization


(3,026
)


(1,996
)$
3,146


$
1,478     Note 6.
    Long-Term
    Obligations    Note 7.
    Facility
    Leases       63




---



##### 



Year ending December 31:2008


1,0202009


1,0462010


1,1842011


1,1942012


1,230Thereafter


316$
5,990     Note 8.
    Related
    Party Transactions    Note 9.
    401(k)
    Plan    Note 10.
    Stockholders
    Equity  Stock
    Options and Employee Stock Purchase Plan
    1)
    The 1996 Equity Incentive Plan (the 1996 Plan),
    which amended and restated the 1992 Incentive Stock Plan in
    March 1996. The Companys Board of Directors reserved
    1,725,000 shares of common stock for issuance under the
    1996 Plan. At the Companys annual meetings of stockholders
    in subsequent years, stockholders approved reserving an
    additional 4,100,000 shares of common stock for issuance
    under the 1996 Plan. The 1996 Plan provides for grants to
    employees of either nonqualified or incentive options and
    provides for the grant to consultants of the Company of
    nonqualified options.2)
    The 1996 Non-Employee Directors Stock Option Plan (the
    Directors Plan) which was approved in March
    1996 and reserved 175,000 shares for issuance to provide
    for the automatic grant of nonqualified options to purchase
    shares of common stock to non-employee Directors of the Company.
    At the Companys annual meetings of stockholders in
    subsequent years, stockholders approved reserving an additional
    250,000 shares of common stock for issuance under the
    Directors Plan. 64




---



##### 



Preferred
    Stock
    Warrants
     65




---



##### 



Note 11.
    Stock-Based
    Compensation  ,
  No. 96-18,
  Pro
    forma Information for Periods prior to the Adoption of
    FAS 123(R)
  
    Year Ended December 31, 2005(In thousands except per share data)Net loss, as reported

$
(95,174
)Deduct: Total stock-based employee compensation determined under
    the fair value based method for all awards, net of related tax
    effects


(13,333
)Net loss-pro
    forma

$
(108,507
)Loss per share:Basic and diluted net loss per
    share-as
    reported

$
(2.64
)Basic and diluted net loss per
    share-pro
    forma

$
(3.01
)   Impact
    of the Adoption of FAS 123(R)
   66




---



##### 



Year Ended December 31,2007


2006(In thousands except per share data)Research and development

$
2,897


$
2,545Selling, general and administrative


11,230



11,496Total share-based compensation expense

$
14,127


$
14,041Impact on basic and diluted net loss per share

$
(0.28
)

$
(0.33
)   No. 96-18,
     67




---



##### 



Valuation
    Assumptions
    Year Ended December 312007

2006

2005Stock Option Plans:Risk-free interest rate

4.66%

4.68%

3.80%Expected life

4.3 years

4.2 years

3.8 yearsExpected volatility

64%

59%

74%Expected dividends

None

None

NoneWeighted average option fair value

$15.41

$11.00

$13.55Stock bonus awards:Expected life

3 years

3 years

-Expected dividends

None

None

-Weighted average fair value per share

$24.84

$21.04

-ESPP:Risk-free interest rate

5.11%

4.33%

3.14%Expected life

6 months

6 months

6 monthsExpected volatility

57%

59%

74%Expected dividends

None

None

NoneWeighted average fair value per share

$3.78

$8.65

$10.79     68




---



##### 



Stock-Based
    Payment Award Activity
    Shares


Number of


WeightedAvailable for


Shares


Average ExerciseEmployee stock
    options:

Grant


Outstanding


PriceBalance at December 31, 2004


1,282,193



2,296,442


$
17.99Shares authorized


3,990,000



-



-Granted


(1,718,000
)


1,718,000


$
24.52Exercised


-



(152,093
)

$
7.73Expired/forfeited


56,268



(56,268
)

$
29.85Balance at December 31, 2005


3,610,461



3,806,081


$
21.17Granted


(1,987,950
)


1,987,950


$
21.60Exercised


-



(347,287
)

$
7.26Expired


19,058



(19,058
)

$
37.83Forfeited


93,209



(93,209
)

$
28.73Balance at December 31, 2006


1,734,778



5,334,477


$
22.05Shares authorized


1,600,000



-



-Granted


(1,167,701
)


1,167,701


$
28.55Exercised


-



(1,477,661
)

$
14.83Expired


430,153



(430,153
)

$
25.88Forfeited


156,458



(156,458
)

$
33.47Balance at December 31, 2007


2,753,688



4,437,906


$
25.39Stock bonus awards:


Shares



Weighted
    Average
    Grant Date
    Fair ValueBalance at December 31, 2005


-



-Granted


40,000


$
21.04Vested


(6,667
)

$
21.04Cancelled


-



-Balance at December 31, 2006


33,333


$
21.04Granted


166,747


$
24.84Vested


(13,333
)

$
21.04Cancelled


(6,724
)

$
24.84Balance at December 31, 2007


180,023


$
24.42  69




---



##### 



Options Outstanding


Options ExercisableWeighted Average








WeightedContractual Life








AverageNumber


Remaining


Weighted Average


Number


ExerciseRange of Exercise Prices

Outstanding


( In years)


Exercise Price


Exercisable


Price$4.20 - $17.43


946,215



7.5


$
14.01



383,768


$
12.47$17.46 - $24.84


1,318,824



8.5


$
22.90



412,545


$
22.18$25.25 - $28.62


1,223,917



8.0


$
27.34



522,900


$
27.08$28.75 - $44.12


894,000



7.4


$
36.91



562,947


$
36.85$44.54 - $55.06


54,950



9.8


$
49.99



883


$
48.12Total


4,437,906



7.9


$
25.39



1,883,043


$
25.96     in-the-money
  Note 12. Income
    Taxes
      December 31,2007


2006(In thousands)Net operating loss carryforwards

$
154,928


$
149,955Tax credit carryforwards


39,158



33,046Capitalized research and development


2,415



3,216Deferred revenue


15,628



15,934Accrued expenses


992



Stock options


6,511



Property and equipment


343



Other






5,022Total deferred tax assets


219,975



207,173Valuation allowance


(219,975
)


(207,173
)Net deferred tax assets

$



$
      70




---



##### 



Accounting for Uncertainty in Income Taxes 
    An Interpretation of FASB Statement No. 109,
      Balance at January 1, 2007

$
0Additions based on tax position related to the current year


0Additions for tax positions of prior years


0Reductions of tax positions of prior year


0Settlements


0Balance at December 31, 2007

$
0       Note 13.
    Guarantees,
    Indemnifications and Contingencies  Guarantees
    and Indemnifications
   71




---



##### 



Contingencies
    Note 14.
    Quarterly
    Financial Data (Unaudited)    2007 Quarter EndedDecember 31


September 30


June 30


March 31(In thousands, except per share data)Total revenues

$
-


$
-


$
-


$
-Net loss


(11,702
)


555



(10,826
)


(12,195
)Basic and diluted net loss per share


(0.21
)


0.01



(0.22
)


(0.26
)   2006 Quarter EndedDecember 31


September 30


June 30


March 31(In thousands, except per share data)Total revenues

$
-


$
100


$
150


$
-Net loss


(20,707
)


(20,148
)


(31,474
)


(20,352
)Basic and diluted net loss per share


(0.47
)


(0.49
)


(0.76
)


(0.49
)   Note 15.
    Subsequent
    Events   72




---



##### 



Exhibits
  ExhibitNumber

Description of Document3
.1(1)

Restated Certificate of Incorporation of the Company.3
.2(20)

Amended and Restated Bylaws of the Company.3
.3(3)

Certificate of Amendment to Amended and Restated Certificate of
    Incorporation.3
.4(13)

Certificate of Amendment to Amended and Restated Certificate of
    Incorporation.4
.1(1)

Reference is made to Exhibits 3.1, 3.2, 3.3 and 3.4.4
.2(1)

Specimen Stock Certificate.10
.1(12)*

Collaboration Agreement between Bayer Corporation (formerly
    Miles, Inc.) and the Company dated April 22, 1994.10
.1(i)(12)*

Amendment to Collaboration Agreement between Bayer Corporation
    and the Company dated April 24, 1996.10
.1(ii)(12)*

Amendment to Collaboration Agreement between Bayer Corporation
    and the Company dated February 1, 1999.10
.2(8)*

Amended and restated Research, Development and Marketing
    Collaboration Agreement dated May 2, 1995 between the
    Company and Warner-Lambert Company.10
.2(i)(8)*

Research, Development and Marketing Collaboration Agreement
    dated July 31, 1997 between the Company and Warner-Lambert
    Company.10
.2(ii)(8)*

Amendment to the Amended and Restated Research, Development and
    Marketing Collaboration Agreement, dated December 15, 1997,
    between the Company and Warner-Lambert Company.10
.2(iii)(8)*

Second Amendment to the Amended and Restated Research,
    Development and Marketing Agreement between Warner-Lambert and
    the Company dated May 2, 1995.10
.2(iv)(8)*

Second Amendment to Research, Development and Marketing
    Collaboration Agreement between Warner-Lambert and the Company
    dated July 31, 1997.10
.2(v)(17)*

Amendment #3 to the Research, Development and Marketing
    Collaboration Agreement between the Company and Warner-Lambert
    dated August 6, 2001.10
.2(vi)(4)*

Amendment #3 to the Amended and Restated Research, Development
    and Marketing Collaboration Agreement between the Company and
    Warner-Lambert dated August 6, 2001.10
.3(5)*

Technology Transfer Agreement dated April 24, 1992 between
    Chiron Corporation and the Company, as amended in the Chiron
    Onyx HPV Addendum dated December 2, 1992, in the Amendment
    dated February 1, 1994, in the Letter Agreement dated
    May 20, 1994 and in the Letter Agreement dated
    March 29, 1996.10
.4(1)+

Letter Agreement between Dr. Gregory Giotta and the Company
    dated May 26, 1995.10
.5(1)+

1996 Equity Incentive Plan.10
.6(1)+

1996 Non-Employee Directors Stock Option Plan.10
.7(20)+

1996 Employee Stock Purchase Plan.10
.8(1)+

Form of Indemnity Agreement to be signed by executive officers
    and directors of the Company.10
.9(10)+

Form of Executive Change in Control Severance Benefits Agreement.10
.10(2)*

Collaboration Agreement between the Company and Warner-Lambert
    Company dated October 13, 1999.10
.10(i)(4)*

Amendment #1 to the Collaboration Agreement between the Company
    and Warner-Lambert dated August 6, 2001.10
.10(ii)(7)*

Second Amendment to the Collaboration Agreement between the
    Company and Warner-Lambert Company dated September 16, 2002.10
.11(6)

Stock and Warrant Purchase Agreement between the Company and the
    investors dated May 6, 2002.10
.12(9)

Sublease between the Company and Siebel Systems dated
    August 5, 2004.10
.12(i)(18)

First Amendment to Sublease between the Company and Oracle USA
    Inc., dated November 3, 2006. 73




---



##### 



ExhibitNumber

Description of Document10
.13(20)+

2005 Equity Incentive Plan.10
.13(i)(18)+

Form of Stock Option Agreement pursuant to the 2005 Equity
    Incentive Plan.10
.13(ii)(18)+

Form of Stock Option Agreement pursuant to the 2005 Equity
    Incentive Plan and the Non-Discretionary Grant Program for
    Directors.10
.14(11)*

United States Co-Promotion Agreement by and between the Company
    and Bayer Pharmaceuticals Corporation, dated March 6, 2006.10
.15(14)+

Letter Agreement between Laura A. Brege and the Company, dated
    May 19, 2006.10
.16(15)+

Letter Agreement between Gregory W. Schafer and the Company,
    dated July 7, 2006.10
.17(15)+

Form of Stock Bonus Award Grant Notice and Agreement between the
    Company and certain award recipients.10
.18(16)

Common Stock Purchase Agreement between the Company and Azimuth
    Opportunity Ltd., dated September 29, 2006.10
.19(19)+

Retirement Agreement between the Company and Edward F. Kenney,
    dated April 13, 2007.10
.20(19)+

2007 Bonus Plan Summary10
.21(21)+

Bonuses for Fiscal Year 2007 and Base Salaries for Fiscal Year
    2008 for Named Executive Officers.23
.1

Consent of Independent Registered Public Accounting Firm.24
.1

Power of Attorney. Reference is made to the signature page.31
.1

Certification of Principal Executive Officer required by
    Rule 13a-14(a)
    or
    Rule 15d-14(a).31
.2

Certification of Principal Financial Officer required by
    Rule 13a-14(a)
    or
    Rule 15d-14(a).32
.1

Certifications required by
    Rule 13a-14(b)
    or
    Rule 15d-14(b)and
    Section 1350 of Chapter 63 of Title 18 of the
    United States Code (18 U.S.C. 1350).     *
    
    Confidential treatment has been received for portions of this
    document.+
    
    Indicates management contract or compensatory plan or
    arrangement.(1)
    
    Filed as an exhibit to Onyxs Registration Statement on
    Form SB-2
    (No.
    333-3176-LA).(2)
    
    Filed as an exhibit to Onyxs Current Report on
    Form 8-K
    filed on March 1, 2000.(3)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended June 30, 2000.(4)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2001.(5)
    
    Filed as an exhibit to Onyxs Annual Report on
    Form 10-K
    for the year ended December 31, 2001. The redactions to
    this agreement have been amended since its original filing in
    accordance with a request for extension of confidential
    treatment filed separately by the Company with the Securities
    and Exchange Commission.(6)
    
    Filed as an exhibit to Onyxs Registration Statement on
    Form S-3
    filed on June 5, 2002
    (No. 333-89850).(7)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2002.(8)
    
    Filed as an exhibit to Onyxs Annual Report on
    Form 10-K
    for the year ended December 31, 2002. The redactions to
    this agreement have been amended since its original filing in
    accordance with a request for extension of confidential
    treatment filed separately by the Company with the Securities
    and Exchange Commission.(9)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2004.(10)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2005.(11)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 2006.(12)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 2006. The redactions to
    this agreement have been amended since its original filing in
    accordance with a request for extension of confidential
    treatment filed separately by the Company with the Securities
    and Exchange Commission. 74




---



##### 



(13)
    
    Filed as an exhibit to Onyxs Registration Statement on
    Form S-3
    (No.
    333-134565)
    filed on May 30, 2006.(14)
    
    Filed as an exhibit to the registrants Current Report on
    Form 8-K
    filed on June 12, 2006.(15)
    
    Filed as an exhibit to the registrants Current Report on
    Form 8-K
    filed on July 12, 2006.(16)
    
    Filed as an exhibit to Onyxs Current Report on
    Form 8-K
    filed on September 29, 2006.(17)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended September 30, 2006. The redactions to
    this agreement have been amended since its original filing in
    accordance with a request for extension of confidential
    treatment filed separately by the Company with the Securities
    and Exchange Commission.(18)
    
    Filed as an exhibit to Onyxs Annual Report on
    Form 10-K
    for the year ended December 31, 2006.(19)
    
    Filed as an exhibit to Onyxs Quarterly Report on
    Form 10-Q
    for the quarter ended March 31, 2007.(20)
    
    Filed as an exhibit to Onyxs Current Report on
    Form 8-K
    filed on May 25, 2007.(21)
    
    Filed as an exhibit to Onyxs Current Report on
    Form 8-K
    filed on February 8, 2008. 75