<PAGE>

                                                                  EXHIBIT 10.190



================================================================================
                    Pharmaceutical Product Development, Inc.

                           Deferred Compensation Plan

================================================================================

                 As Amended and Restated Effective July 1, 2002

<PAGE>

================================================================================

                    Pharmaceutical Product Development, Inc.

                           Deferred Compensation Plan

================================================================================


I.    Name and Purpose

The name of this plan is the Pharmaceutical Product Development, Inc. Deferred
Compensation Plan (the "Plan"). Its purpose is to provide certain select
management or highly compensated employees on the payroll of either
Pharmaceutical Product Development, Inc. (the "Company") or a subsidiary of the
Company (the "Affiliates") with the opportunity to defer compensation earned as
an employee, gain from the exercise of stock options, and shares of Company
stock received from the lapse of restrictions on restricted stock of the
Company.

II.   Effective Date

The Plan shall be amended and restated effective as of July 1, 2002.

III.  Participants

All employees who are officers, senior vice presidents, vice presidents and
executive directors of the Company or an Affiliate who are receiving
compensation in the United States from the Company or an Affiliate shall be
eligible to participate in the Plan. Any such Employee who elects to participate
in the Plan is hereinafter called a "Participant." The Company will establish
for each Participant one or more unfunded deferred compensation accounts, as
specified in Article V.

IV.   Election of Deferral

      A.    On or before December 31 of any year, each Employee eligible to
            participate shall be entitled to make an irrevocable election on the
            form established from time to time by the Committee (hereinafter the
            "Deferral Agreement") to defer receipt of all or a specified portion
            of the salary otherwise payable (whether or not otherwise deferred)
            from the Company for the following calendar year. Such election
            shall remain effective from year to year, unless changed by the
            Employee with respect to the next following calendar year.

      B.    For the first calendar year that an Employee becomes eligible, an
            Employee must complete, execute and return to the Committee a
            Deferral Agreement within 30 days after the Employee becomes
            eligible. Elections for the 2001 calendar year shall be made prior
            to January 31, 2001, in accordance with rules adopted by the
            Committee.

      C.    The term "salary" as used herein shall include all compensation
            other than income from the exercise of stock options, relocation
            expense reimbursements and tuition reimbursements. If a Participant
            wishes to defer the payment of all or a portion of the bonus earned
            for a particular year (whether or not he otherwise elects to defer

                                       -1-

<PAGE>

            salary), he must make a separate election. Such election will apply
            to the fiscal year of the Company in which the bonus is paid. Such
            election must be completed and returned to the Committee on or
            before December 31 immediately preceding the beginning of the fiscal
            year of the Company during which the bonus would be paid; provided,
            however, for the plan year beginning February 1, 2001, such election
            shall be made by January 31, 2001.

      D.    Employees may elect to defer receipt of between one and twenty-five
            percent of salary, other than bonus, in increments of one percent.
            Employees, other than officers, senior vice presidents and vice
            presidents, may elect to defer receipt of between one and
            twenty-five percent of bonus, in increments of one percent.
            Officers, senior vice presidents and vice presidents may elect to
            defer receipt of between one and one hundred percent of bonus in
            increments of one percent.

      E.    A Participant's deferrals under the Plan shall be determined before
            a Participant's contributions to the Pharmaceutical Product
            Development, Inc. Retirement Savings Plan ("RSP"). A Participant
            shall make separate deferral elections with respect to the Plan and
            the RSP. At anytime during a calendar year a Participant by timely
            notifying the Committee, in accordance with it rules and procedures,
            may elect to suspend deferrals to the Plan. Such Participant may
            elect deferral for subsequent calendar years in accordance with the
            procedures in this Article IV.

V.    Deferred Compensation Accounts

      A.    Separate Accounts (and subaccounts if elected in accordance with
            Section IX A. below) shall be established and maintained for each
            Participant reflecting the amount deferred by the Participant in the
            Plan.

      B.    At the end of each calendar quarter an amount equal to the
            Participant's deferral for such quarter shall be credited to the
            appropriate Account of such Participant to reflect the salary or
            bonus otherwise payable during payroll periods ending in that
            calendar quarter but deferred pursuant to the Plan by the
            Participant. Interest will be credited to the Participant's Account
            as of the last day of each calendar quarter based upon the balance
            in the Participant's Account on the first day of such quarter after
            reducing that Account to reflect any distributions or withdrawals
            from such Account during such quarter and after crediting the
            Account with fifty percent of the deferrals for such calendar
            quarter. Interest for each calendar quarter shall be based on the
            three month London Interbank Offered Rate (or similar index
            designated by the Committee) plus 1.5%.

      C.    Separate subaccounts shall be established for a Participant if the
            Participant so elects and the Committee so approves in accordance
            with Article IX.

VI.   Deferral of Stock Option Gain

      A.    For purposes of this Article VI, the following terms shall be
            defined as follows:

                                       -2-

<PAGE>

            Common Stock. "Common Stock" shall mean the common stock of
            Pharmaceutical Product Development, Inc., $0.10 par value per share.

            Consideration Shares. "Consideration Shares" shall mean shares of
            common stock acquired by a Participant (a) on the open market or (b)
            through the exercise of a nonqualified Stock Option that has been
            owned by the Participant for at least (6) six months.

            Date of Exercise. "Date of Exercise" shall mean the date on or after
            which Stock Options designated in a Stock Option Gain Deferral
            Agreement will be exercised and any gain derived therefrom will be
            deferred pursuant to Article VI of this Plan; provided that such
            date shall be at least six months from the date of the Stock Option
            Gain Deferral Agreement.

            Exchange Act. "Exchange Act" shall mean the Securities Exchange Act
            of 1934, as amended, and all rules and regulations promulgated
            thereunder.

            Fair Market Value. "Fair Market Value," with respect to a share of
            Common Stock as of any date, shall mean (a) the closing sales price
            of the Common Stock on the NASDAQ National Market System or on any
            such other exchange on which the Common Stock is traded on such
            date, or in the absence of reported sales on such date, the closing
            sales price on the immediately preceding date on which sales were
            reported, or (b) in the even there is no public market for the
            Common Stock on such date, the Fair Market Value as determined in
            good faith by the Committee in its sole and absolute discretion.

            Gain Shares. "Gain Shares" shall mean the shares of Common Stock
            determined in accordance with the provisions of Section VI E. hereof
            resulting from the exercise of any Stock option pursuant to Article
            VI of this Plan.

            Gain Share Account. "Gain Share Account" shall mean the record of a
            Participant's interest in this Plan represented by the number of the
            Share Units related to Gain Shares, adjusted for hypothetical gains,
            earnings dividends, losses, distributions, withdrawals and other
            similar activities.

            Share Units. "Share Units" shall mean units of deemed investment in
            shares of Common Stock in accordance with Article VI of the Plan.

            Stock Option. "Stock Option" shall mean an option to purchase Common
            Stock from the Company that was granted under a Stock Option Plan.

            Stock Option Gain Deferral Agreement. "Stock Option Gain Deferral
            Agreement" shall mean the form established from time to time by the
            Committee that an Employee completes, executes and returns to the
            Committee to defer receipt of Gain Shares received from the exercise
            of a Stock Option pursuant to Article VI hereof.

                                       -3-

<PAGE>

            Stock Option Plan. "Stock Option Plan" shall mean collectively the
            equity incentive plans adopted by the Company from time to time or
            under which the Company has Stock Options outstanding, and
            individually, such equity incentive plan governing any particular
            Stock Option.

      B.    Subject to provisions of this Article VI, eligible employees may
            elect to defer the receipt and distribution of the gain related to
            the exercise of Stock Options until the "distribution event date"
            elected by the employee pursuant to Article VIII hereof, by filing a
            Stock Option Gain Deferral Agreement with the Committee. A Stock
            Option Gain Deferral Agreement may be filed at any time with respect
            to any number of Stock Options.

      C.    A Stock Option Gain Deferral Agreement must be filed at least six
            months prior to the Date of Exercise and no later than the day
            immediately preceding the first day of the six-month period ending
            on the expiration date of the Stock Option. A Stock Option with
            respect to which a Stock Option Gain Deferral Agreement has been
            filed may not be exercised prior to the date specified in the Stock
            Option Gain Deferral Agreement. A Participant must be an Employee on
            the Date of Exercise to effect a Deferral of Gain Shares hereunder.

      D.    Each Stock Option Gain Deferral Agreement shall set forth: (a) the
            number of Stock Options to be exercised; (b) the date of grant of
            the Stock Options; (c) the Date of Exercise; (d) the date on which
            the Gain Shares credited to the Participant's Gain Share Account
            shall be payable; (e) whether distribution shall be in installments
            or in a lump sum; and (f) any other item determined to be
            appropriate by the Committee. Gain Shares shall be distributed in a
            lump sum in the form of Common Stock.

      E.    An Employee who desires to exercise a Stock Option and to defer
            current receipt and distribution of the related Gain Shares must
            follow the procedures and requirements that are applicable to the
            Stock Option under the Stock Option Plan, including the procedures
            and requirements relating to the exercise of an Option; provided,
            however, that in the case of a deferral of Gain Shares under this
            Plan, the Employee shall only be permitted to tender Consideration
            Shares to pay the entire exercise price for any such Stock Option
            exercised. Notwithstanding the foregoing, the Committee may in its
            discretion accept documentation that the Employee owns the number of
            Consideration Shares necessary to pay the exercise price for the
            Stock Options.

      F.    Upon exercise of a Stock Option, the Gain Shares resulting from the
            exercise of the Stock Option which the Employee has elected to defer
            hereunder shall be determined as follows: (a) the aggregate exercise
            price for all Stock Options to be exercised shall be determined by
            multiplying the exercise price of the Stock Option by the number of
            Stock Options to be exercised at that price; (b) the number of
            Consideration Shares needed to pay the exercise price for such Stock
            Options shall be determined by dividing the aggregate exercise price
            from (a) above by the Fair Market Value of one share of Common Stock
            on the Date of

                                       -4-

<PAGE>

            Exercise; and (c) the difference between the aggregate Fair Market
            Value on the Date of Exercise of the shares of Common Stock acquired
            upon the exercise of the Stock Options and the aggregate exercise
            price of such Stock Options, divided by the Fair Market Value of one
            share of Common Stock on the Date of Exercise, shall be the number
            of Gain Shares resulting from such exercise.

      G.    Subject to the provisions of Section VIII D. hereof, all deferrals
            of Gain Shares hereunder are irrevocable. A Participant may not
            increase the amount of his Gain Share deferrals occurring under any
            given Stock Option Gain Deferral Agreement following submission of
            the Stock Option Gain Deferral Agreement. A Participant may
            terminate a Gain Share deferral any time prior to the Date of
            Exercise by filing, on such forms and subject to such limitations
            and restrictions as the Committee may prescribe in its discretion, a
            revised Stock Option Gain Deferral Agreement with the Committee.
            Under no circumstances may a Participant's Stock Option Gain
            Deferral Agreement be made, modified or revoked retroactively.

      H.    If an Employee makes a valid election under this Article VI to defer
            Gain Shares and if the Stock Option expires without a proper
            exercise of the Stock Option by the Employee, or if the Employee
            fails to properly tender or attest to the Consideration Shares by
            the last day of the Stock Option term, the Employee shall forfeit
            any opportunity to exercise the Stock Option and the Stock Option
            shall be canceled as of the end of the last business day of the
            Stock Option term, according to the terms of the Stock Option Plan.

      I.    A Participant shall be fully vested at all times in his or her Gain
            Share Account.

      J.    Gain Share Accounts are bookkeeping accounts, the value of which
            shall be based upon the performance of the Common Stock. Any and all
            dividends paid with respect to the Common Stock will be deemed to be
            immediately reinvested in Common Stock. It is understood and agreed
            that the Company assumes no risk of any decrease in the value of the
            Common Stock, and the Company's sole obligations are to maintain the
            Participant's Gain Share Account and make payments to the
            Participant as herein provided.

      K.    In the event of a stock dividend, split-up or combination of the
            Common Stock, merger, consolidation, reorganization or
            recapitalization affecting the Common Stock, such that an adjustment
            is determined by the Committee to be appropriate in order to prevent
            dilution or enlargement of the benefits or potential benefits
            intended to be made available under this Article VI, then the
            Committee may make appropriate adjustments to the number of Share
            Units credited to any Gain Share Account. The determination of the
            Committee as to such adjustments, if any, shall be binding and
            conclusive.

      L.    Notwithstanding any other provision of this Plan, the Committee
            shall adopt such procedures as it may determine are necessary to
            ensure that with respect to any Participant who is actually or
            potentially subject to Section 16(b) of the Exchange

                                       -5-

<PAGE>

            Act, the crediting of deemed shares to such Participant's Gain Share
            Account is not deemed to be a nonexempt purchase for purposes of
            such Section 16(b), including without limitation requiring that no
            shares of Common Stock relating to such deemed shares may be
            distributed for six months after being credited to such Deferral
            Account.

      M.    All distributions of a Participant's Gain Share Account shall be in
            the form of shares of Common Stock.


VII.  Deferral of Restricted Stock

      A.    For purposes of this Article VII, the following terms shall be
            defined as follows:

            Common Stock. "Common Stock" shall mean the common stock of
            Pharmaceutical Product Development, Inc., $0.10 par value per share.

            Restricted Stock/Restricted Stock Award. "Restricted Stock" or
            "Restricted Stock Award" shall mean a share of restricted Common
            Stock that was granted to an Employee under a Stock Plan.

            Restricted Stock Deferral Agreement. "Restricted Stock Deferral
            Agreement" shall mean the form established from time to time by the
            Committee that an Employee completes, executes and returns to the
            Committee to defer the receipt of shares of Common Stock upon the
            lapse of restrictions on Restricted Stock Awards.

            Restricted Stock Unit/RSU. "Restricted Stock Unit" or "RSU" shall
            mean units of deemed investment in shares of Common Stock in
            accordance with Article VIII of the Plan.

            Restricted Stock Unit Account/RSU Account. "Restricted Stock Unit
            Account" or "RSU Account" shall mean the record of a Participant's
            interest in this Plan represented by the number of RSUs related to
            shares of Restricted Stock deferred hereunder, adjusted for
            distributions, withdrawals and other similar activities as provided
            in the Plan.

            Stock Plan. "Stock Plan" shall mean collectively the equity
            incentive plans adopted by the company from time to time or under
            which the Company has Restricted Stock Awards outstanding, and
            individually, such equity incentive plan governing any particular
            Restricted Stock Award.

      B.    The provisions of this Article VII shall apply to all deferral
            elections made in compliance with this Article VII. All participants
            who have received Restricted Stock Awards under a Stock Plan of the
            Company, some or all of the restrictions on which have not lapsed as
            of December 31, 2002, and all persons who receive a Restricted Stock
            Award under a Stock Plan of the Company after the effective date of
            this Plan whose Agreement provides that the recipient may elect to
            defer the receipt of such Restricted Stock Award are permitted to
            make deferral

                                       -6-

<PAGE>

            elections with respect to such Restricted Stock Awards under this
            Plan by following the provisions of this Article VII.

      C.    Eligible employees who elect to defer Restricted Stock Awards must
            enter into an irrevocable Restricted Stock Deferral Agreement, in
            the form approved by the Committee, which provides for the exchange
            of shares of Restricted Stock for Restricted Stock Units. A
            Restricted Stock Deferral Agreement may be filed at any time with
            respect to any number of Restricted Shares with respect to which the
            restrictions have not and are not due to lapse for at least six (6)
            months.

      D.    Each Restricted Stock Deferral Agreement shall set forth: (a) the
            number of shares of Restricted Stock to be deferred; (b) the date of
            grant of such shares of Restricted Stock; (c) the date or dates on
            which the restrictions imposed on such shares of Restricted Stock
            lapse; (d) the date on which the Restricted Stock Units credited to
            the Participant's Restricted Stock Unit Account shall become
            payable; and (e) whether distribution of the Restricted Stock Units
            shall be in installments or in a lump sum; and (f) any other item
            determined to be appropriate by the Committee. Participants agree to
            execute any form that may be required by the Company's stock
            transfer agent with respect to book-entry or certificated shares. If
            the shares are not held in book-entry format by the Company's stock
            transfer agent, eligible Employees deferring Restricted Stock Awards
            must also tender the certificates for the shares of Restricted Stock
            with respect to which the Restricted Stock Deferral Agreement is
            being entered into at the time the Restricted Stock Deferral
            Agreement is tendered.

      E.    The effective date of the deferral of Restricted Stock hereunder is
            the close of business on the business day on which the Committee, or
            its designee, receives the Restricted Stock Deferral Agreement, and
            if the shares of Restricted Stock are not held in book-entry format,
            the certificates for the shares of Restricted Stock, along with any
            properly completed and executed stock powers that may be requested
            by the Committee.

      F.    Until the date specified in the Participant's Restricted Stock
            Deferral Agreement as the date on which restrictions on the shares
            of Restricted Stock will lapse, RSU's credited to such Participant's
            Restricted Stock Unit Account upon the deferral of such shares of
            Restricted Stock shall remain subject to forfeiture under the
            provisions of the Stock Plan and any related Restricted Stock Award
            agreement in the same manner as the shares of Restricted Stock
            deferred hereunder. The RSU's will be subject to restrictions
            identical to the restrictions on the shares of Restricted Stock
            deferred hereunder, and the restrictions on the RSU's shall lapse,
            if at all, at the same time and in the same manner that the
            restrictions on the shares of Restricted Stock would have lapsed had
            the participant not made a deferral election.

      G.    For each Participant electing to defer Restricted Stock, upon the
            effective date of the deferral, a RSU Account will be established by
            the Company, reflecting one RSU for each Restricted Stock share
            deferred hereunder. A subaccount

                                       -7-

<PAGE>

            representing cash equal to the earnings credited to the RSU Account
            with respect to dividend equivalents and interest thereon as
            calculated pursuant to Section V. B hereof, will also be
            established, unless the Participant has elected to receive earnings
            attributable to RSU's currently, and not on a deferred basis,
            pursuant to Section VII J. hereof. Earnings will be credited to the
            Participant's cash subaccount as follows: on each date on which the
            Company pays a dividend on its Common Stock, an amount equal to such
            dividend will be credited to the Participant's Account with respect
            to each RSU. Then, an additional amount will be credited to the
            Participant's cash subaccount to reflect earnings pursuant to
            Section V B. hereof to reflect earnings on the dividend equivalents
            from the time they were credited to the cash subaccount hereunder.

      H.    In the event of a stock dividend, split-up or combination of the
            Common Stock, merger, consolidation, reorganization or
            recapitalization affecting the Common Stock, such that an adjustment
            is determined by the Committee to be appropriate in order to prevent
            dilution or enlargement of the benefits or potential benefits
            intended to be made available under this Article VII, then the
            Committee may make appropriate adjustments to the number of Share
            Units credited to any RSU Account. The determination of the
            Committee as to such adjustments, if any, shall be binding and
            conclusive.

      I.    Restricted Stock Units shall be distributed in the form of Common
            Stock. Distributions from a Participant's RSU Account and related
            RSU cash subaccount pursuant to Article VIII hereof will be computed
            as follows: with respect to the Participant's RSU Acccount, one
            share of Common Stock will be distributed for each RSU credited to
            such RSU Account; and with respect to the Participant's RSU cash
            subaccount, cash in the amount credited to such subaccount will be
            paid to the Participant.

      J.    A Participant may elect to receive earnings attributable to the
            Participant's RSU cash subaccount currently, and not on a deferred
            basis, by indicating such an election on the Participant's
            Restricted Stock Deferral Agreement. If such an election is made,
            the Participant will receive in cash on each date on which the
            Company pays a dividend on its shares of Common Stock an amount
            equal to such dividend with respect to each RSU in the Participant's
            RSU Account. Such payment shall be made in lieu of crediting any
            amount to the Participant's RSU cash subaccount pursuant to Section
            VII G. hereof, and such Participant's RSU cash subaccount will be
            deemed to be "zero" for all purposes under the Plan.

VIII. Method of Distribution of Deferred Compensation

      A.    At the time a Participant executes his or her first Deferral
            Agreement, Stock Option Gain Deferral Agreement, or Restricted Stock
            Deferral Agreement, the Participant shall duly designate, execute,
            and file with the Committee on the Deferral Agreement, Stock Option
            Gain Deferral Agreement, Restricted Stock Deferral Agreement, or
            other appropriate form designated by the Committee, the date upon
            which the entire amount of his or her Account, Gain Share Account,

                                       -8-

<PAGE>

            and/or Restricted Stock Unit Account shall become payable. In the
            event of the Participant's termination of employment following the
            attainment of age 55 and the completion of ten (10) years service (a
            "qualified termination event"), a Participant may designate that
            payment of his or her Account, Gain Share Account, and/or Restricted
            Stock Unit Account commences upon (a) the date of the Participant's
            termination of employment or (b) a date 10 years after termination
            of employment (such date hereinafter referred to as a "distribution
            event date"). In the event of the Participant's termination of
            employment for any reason other than death and Disability (as
            hereinafter defined) prior to attaining the age of 55 and completing
            ten (10) years of service, the balance of a Participant's Account,
            Gain Share Account and/or Restricted Stock Unit Account shall be
            paid in a lump sum within thirty (30) days of the date of the
            Participant's termination of employment. In the event of a
            Participant's death, the balance of the Participant's Account, Gain
            Share Account, and/or Restricted Stock Unit Account shall be
            distributed as elected by the Participant pursuant to Section B
            below within thirty (30) days of the date of death. In the event of
            a Participant's Disability, the balance of the Participant's
            Account, Gain Share Account, and/or Restricted Stock Unit Account
            shall be distributed as provided in Section XI hereof in such form
            as elected by the Participant pursuant to Section B below.

      B.    The Participant shall elect one of the following forms of payment
            for the distribution of the balance of his or her Account, Gain
            Share Account, and/or Restricted Stock Unit Account upon a qualified
            termination event, death or Disability:

            (i)   Lump Sum. In the event a Participant elects a single sum
                  payment in the event of death or Disability, or following a
                  qualified termination event, the amount of the Participant's
                  Account, Gain Share Account, and/or Restricted Stock Unit
                  Account shall be paid (a) as soon as practicable following
                  January 1 of the year following the calendar year during which
                  the Participant's qualified termination event occurs, (b)
                  within thirty (30) days of the date of death, or (c) as soon
                  as practicable following the occurrence of the event by which
                  distribution may be made pursuant to Section XI hereof in the
                  event of the Participant's Disability, as the case may be. The
                  Participant shall receive a single sum cash payment equal to
                  the amount credited to his or her Account. The Participant
                  shall receive a single sum in the form of Common Stock equal
                  to the number of Share Units credited to his or her Gain Share
                  Account and/or Restricted Stock Units credit to his or her
                  Restricted Stock Unit Account.

            (ii)  Installments. In the event a Participant elects installment
                  payments, the Participant shall receive the amount credited to
                  his or her Account, Gain Share Account, and/or Restricted
                  Stock Unit Account in ratable semi-annual installments payable
                  over a period of 5, 10 or 15 years; provided however, that in
                  no event may any semi-annual installment (except the last
                  installment) be in an amount of less than $2,000 (or such
                  other amount the Committee may specify); and provided further,
                  that in the event the

                                       -9-

<PAGE>

                  installment period elected by the Participant would otherwise
                  result in one or more semi-annual installments of less than
                  $2,000, then such installment period may be automatically
                  shortened by the Committee to the extent necessary to assure
                  that each such installment (except for the last one) will be
                  an amount of not less than $2,000. Such semi-annual
                  installments shall commence as soon as practicable following
                  the January 1 or July 1 immediately following the
                  Participant's qualified termination event, death, or
                  commencement of payments following Disability, and be payable
                  throughout the installment period to the participant as soon
                  as practicable after each January and July 1 thereafter. In
                  the event a Participant terminates employment before attaining
                  age 55 and completing 10 years of service with the Company or
                  an Affiliate, terminates employment under circumstances deemed
                  by the Committee to be detrimental to the Company or works for
                  a competitor of the Company then the Committee shall,
                  notwithstanding any installment election made by the
                  Participant, have the right to pay the amount the Participant
                  has remaining in his Account, Gain Share Account and/or
                  Restricted Stock Unit Account, in a lump sum payment within
                  thirty (30) days of the Participant's termination of
                  employment.

      C.    A Participant may change his or her elections under A or B at any
            time by duly completing, executing, and filing with the Committee
            his or her new election in an appropriate form designated by the
            Committee; provided however, that for any such change of election to
            be effective, a full calendar year must pass between the calendar
            year during which the Participant duly makes the change of election
            and the calendar year during which distribution of any portion of
            the Participant's Account, Gain Share Account, and/or Restricted
            Stock Unit Account is first to become payable after taking the
            change of election into account. In the event a Participant has not
            made an election under A or B, then the Participant shall be treated
            as having a qualified termination event on the date of the
            Participant's termination of employment under Section A above; and a
            form of payment of a lump sum under Section B above.

      D.    At any time a Participant may withdraw all or any fixed dollar
            portion of the Participant's Account, Gain Share Account, and/or
            Restricted Stock Unit Account by duly completing, executing, and
            filing with the Committee the appropriate form designated by the
            Committee establishing that the Participant has a severe financial
            hardship. The Committee, in its sole and absolute discretion, shall
            determine whether the Participant has suffered a financial hardship
            justifying a withdrawal. In addition, at any time a Participant may
            withdraw all or any fixed dollar portion of the Participant's
            Account, Gain Share Account, and/or Restricted Stock Unit Account by
            duly completing, executing and filing with the Committee the
            appropriate form designated by the Committee for a significant
            detriment withdrawal. The Committee will process such significant
            detriment withdrawal request, but shall cause a forfeiture to the
            Company from the Participant's Account, Gain Share Account, and/or
            Restricted Stock Unit Account of 10% of

                                      -10-

<PAGE>

            the amount requested by the Participant. The Participant shall
            receive 90% of the amount requested.

      E.    Notwithstanding the foregoing provisions of this Article VIII, upon
            a Change in Control, the Plan will be deemed to have been terminated
            and a Participant's Account, Gain Share Account, and/or Restricted
            Stock Unit Account shall be paid to the Participant as elected by
            the Participant pursuant to B hereunder as soon as practicable;
            provided, however, a Participant may elect by duly completing,
            executing, and filing with the Committee on an appropriate form
            designated by the Committee that the Participant elects to continue
            to participate in the Plan, and in such event, the Plan will not be
            deemed to have been terminated with respect to the Participant and
            the Participant's Account and/or Gain Share Account shall not be
            distributed. Such election shall be made during the period ending on
            the date 30 days following the date the Board approves a corporate
            event leading to a Change in Control or announces it to employees
            generally. Upon payment under this Section VIII E, the obligation of
            the Plan and the Company to the Participant shall be fully satisfied
            and completely discharged, and the Participant shall be permanently
            barred from further participation in the Plan. For purposes of this
            Article VIII of the Plan, a "Change in Control" shall be deemed to
            have occurred if:

            (a) Any "Person" as defined in Section 3(a)(9) of the Securities
            Exchange Act of 1934, as amended (the "Exchange Act"), including a
            "group" (as that term is used in Sections 13(d)(3) and 14(3)(2) of
            the Exchange Act), but excluding the Company and any employee
            benefit plan sponsored or maintained by the Company, including any
            trustee of such plan acting as trustee, who:

                (i)  makes a tender or exchange offer for any shares of the
            Common Stock pursuant to which any shares of the Common Stock are
            purchased (an "Offer"); or

                (ii) together with its "affiliates" and "associates" (as those
            terms are defined in Rule 12b-2 under the Exchange Act) becomes the
            "Beneficial Owner" (within the meaning of Rule 13d-3 under the
            Exchange Act) of at least 20% of the Common Stock (an
            "Acquisition");

            (b) The shareholders of the Company approve a definitive agreement
            or plan to merge or consolidate the Company with or into another
            corporation, to sell or otherwise dispose of all or substantially
            all of its assets, or to liquidate the Company (individually, a
            "Transaction"); or

            (c) When, during any period of 24 consecutive months during the
            existence of the Plan, the individuals who constitute the Board (the
            "Incumbent Directors") at the beginning of such period cease for any
            reason other than death to constitute at least a majority thereof;
            provided, however, that a director who was not a director at the
            beginning of such 24-month period shall be deemed to have satisfied
            such 24-month requirement, and be an Incumbent Director, if such
            director was elected by, or on the recommendation of or with the
            approval of, at least two-thirds of the

                                      -11-

<PAGE>

            directors who then qualify as Incumbent Directors either actually,
            because they were directors at the beginning of such 24-month
            period, or by prior operation of this Section VIII E(c).

            (d) An Offer, Acquisition or Transaction, as the case may be, is
            approved by a majority of the Directors serving as members of the
            Board at the time of the Offer, Acquisition or Transaction.

      F.    Notwithstanding the foregoing provisions of this Section VIII and
            elections made by a Participant thereunder, if any distribution or
            withdrawal under the Plan to a Participant who is a "Covered
            Employee"(as defined herein) from an Account, Gain Share Account
            and/or Restricted Stock Unit Account will result in any portion of
            the distribution or withdrawal (or any other amount paid by the
            company to such Participant during the same Plan Year) not being tax
            deductible by reason of Section 162(m) of the Internal Revenue Code
            of 1986, as amended from time to time ("Section 162(m)"), then such
            distribution or withdrawal shall be deferred until the earliest to
            occur of (i) the calendar year following the Participant's year of
            termination of employment, (ii) the first calendar year in which
            such Participant is no longer a "Covered Employee", or (iii) such
            later date designated by the Committee in its sole and absolute
            discretion, and such Account, Gain Share Account and/or Restricted
            Stock Unit Account shall continue to accrue interest and have
            investment returns measured in accordance with the terms of this
            Plan until such date. For purposes of this paragraph, "Covered
            Employee" shall mean at any date (iv) any individual who, with
            respect to the previous taxable year of the Company, was a "covered
            employee" of the Company within the meaning of Section 162(m);
            provided, however, that the term "Covered Employee" shall not
            include any such individual who is designated by the Committee, in
            its discretion, at the time of any distribution or withdrawal
            hereunder, as reasonably expected not to be such a "covered
            employee" with respect to the current taxable year of the Company
            and (v) any individual who is designated by the Committee, in its
            discretion, at the time of any distribution or withdrawal, as
            reasonably expected to be such a "covered employee" with respect to
            the current taxable year of the Company or with respect to the
            taxable year of the Company in which any applicable distribution or
            withdrawal will be paid.

      G.    Any amounts debited from a Participant's Account, Gain Share
            Account, and/or Restricted Stock Unit Account by reason of a
            distribution, withdrawal, or otherwise under this Article VIII,
            shall be debited from the Participant's Account, Gain Share Account,
            and/or Restricted Stock Unit Account as the case may be, and such
            other accounts, subaccounts, options, or other allocations in the
            same proportion that the Participant's entire Account, Gain Share
            Account, and/or Restricted Stock Unit Account is credited at the
            time such debit is made, as determined by the Committee.

IX.   In-Service Subaccount

                                      -12-

<PAGE>

      A.    A Participant may request that the Committee establish one or more
            Subaccounts for deferrals made pursuant to Article IV of this Plan
            providing for an in-service withdrawal that is not occasioned by a
            severe hardship or a significant detriment withdrawal by duly
            completing, executing, and filing with the Committee such request on
            an appropriate form designated by the Committee. The Committee may
            condition its approval of any such Subaccount. Each Subaccount the
            Committee approves for a Participant shall be established as of the
            start of the calendar year following the calendar year during which
            the Committee's approval occurs; provided however, that in the event
            the Committee's approval for a Subaccount occurs after December 15
            of a calendar year, then such Subaccount shall be established as of
            the start of the calendar year second following the calendar year
            during which such Committee approval occurred. The portion of an
            Employee's Account not credited to one or more of his or her
            Subaccounts is the Employee's Account.

      B.    Except as provided in the following provisions of this Article IX,
            each Subaccount of a Participant shall be treated as a separate
            Account under the foregoing Articles of this Plan.

      C.    The overall limits on the maximum amounts of deferrals shall apply
            with respect to all of the Participant's Subaccounts as if all such
            Subaccounts were a single Account under the Plan. A Participant may
            designate the total amount and allocation of deferrals among his or
            her Subaccounts by completing, executing, and filing with the
            Committee the appropriate form designated by the Committee by
            December 15 of the calendar year before the calendar year in which
            the change is to be effective. In the event a Participant evidences
            severe financial hardship for a year, then all deferrals to all of
            the Participant's Subaccounts shall be stopped.

      D.    The distribution event date for each of the Participant's
            Subaccounts shall be any distribution event date irrevocably
            specified by the Employee that is no less than three years following
            the date the first amount is actually credited to that Subaccount
            upon duly completing, executing, and filing with the Committee the
            appropriate form designated by the Committee no later than the time
            such Subaccount is established. No later than the establishment of a
            Subaccount for a Participant, the Participant shall irrevocably
            designate on such form a semi-annual installment form of payment for
            a period that is not more than eight semi-annual installments.
            Separate elections under the foregoing provisions of this Section IX
            D. will be made for each Subaccount established for a Participant.
            No withdrawals before the distribution event date may be made from
            any Subaccount. In the event a Participant fails to designate either
            the timing or form of distribution of any Subaccount established for
            the Participant, then any amounts that are or would have been
            allocated to such Subaccount shall be credited instead to the
            Participant's Account. All of a Participant's Subaccounts shall be
            treated as a single Account, under the Plan for purposes of any
            death benefits payable under the Plan.

                                      -13-

<PAGE>

      E.    A Participant may elect to dissolve any Subaccount established on
            his or her behalf and to transfer the balance of that Subaccount in
            multiples of 10 percent of each balance to his or her other
            Subaccounts of the same origin, or 100 percent of such balance to
            his or her Account, by duly completing, executing, and filing with
            the Committee an appropriate form designated by the Committee;
            provided however, that for an election to dissolve a Subaccount to
            be effective, a full calendar year must pass between the calendar
            year during which the Participant duly makes the dissolution
            election and the calendar year during which distribution of any
            portion of such Subaccount is first to become payable; and provided
            further that in the absence of such elective allocation of the
            balance of the Subaccount upon its dissolution, that the balance
            shall be transferred in its entirety to the Participant's Account.
            In no other event may transfers be made among the Participant's
            Subaccounts.

X.    Distribution Upon Death

If any Participant dies before receiving all amounts credited to his Account,
Gain Share Account, and/or Restricted Stock Unit Account, the unpaid amounts in
the Participant's Account, Gain Share Account, and/or Restricted Stock Unit
Account shall be paid as elected by the Participant pursuant to Article VIII
hereof, to the Participant's beneficiary or beneficiaries in accordance with the
last effective beneficiary designation form filed by the Participant with the
Committee. Each Participant shall file with the Committee a form indicating the
person, persons, or entity which are to receive the Participant's benefits under
the Plan if he dies before receiving all the balances in his Account, Gain Share
Account, and/or Restricted Stock Unit Account. A Participant's beneficiary
designation may be changed at any time prior to his death by execution and
delivery of a new beneficiary designation form. If a Participant has failed to
designate a beneficiary or no designated beneficiary survives the Participant,
payment shall be made in a lump sum to the Participant's surviving spouse. If
the Participant has no surviving spouse, the benefits remaining under the Plan
to be paid to a beneficiary shall be payable to the executor or personal
representative of the Participant's estate. A beneficiary who fails to survive a
Participant by at least 10 days shall be deemed to have predeceased the
Participant.

XI.   Effect of Disability of Participant

In the event of the Disability of a Participant, all amounts credited to the
Participant's Account, Gain Share Account and/or Restricted Stock Unit Account
and remaining unpaid on the date of the onset of the Disability shall be paid to
the Participant, in such form as elected by the Participant for each such
account, upon the earlier to occur of the Participant's attainment of the age of
55 with 10 years of service or the cessation of benefit payments to the
Participant under any Company long-term disability plan. For purposes of this
Article XI of the Plan, "Disability" shall mean the total and permanent
disability of a Participant, as determined under the terms of the long-term
disability plan of the Company then in effect, or in the absence of a long-term
disability plan, as determined by the Board, in its sole and absolute
discretion, and shall be deemed for purposes of this Plan to be a Termination of
Employment with PPD, Inc.

XII.  Benefit Plans

                                      -14-

<PAGE>

      A.    The amount of each Participant's compensation which he elects to
            defer under the Plan shall not be deemed to be compensation for the
            purpose of calculating the amount of a Participant's benefits or
            contributions under a pension plan or retirement plan (qualified
            under Section 401(a) of the Internal Revenue Code), but shall be
            deemed to be compensation for purpose of calculating the amount of a
            Participant's amount of life insurance under a Company-supplied life
            insurance plan, the basis for establishing disability payments under
            a disability plan or the basis or amount for any other
            Company-supplied benefit plan where the benefits are based upon an
            employee's compensation.

      B.    With respect to any benefit plan under which an Employee's
            contribution is based on the Employee's compensation, the amount of
            the Participant's contribution to any such plan shall not take into
            account the amount of the Participant's compensation deferred under
            this Plan unless otherwise specifically provided in such plan.

      C.    No amount distributed to a Participant from a Participant's Account,
            Gain Share Account, and/or Restricted Stock Unit Account under this
            Plan shall be deemed to be compensation with respect to a
            Participant's entitlement to benefits under any employee benefit
            plan established by the Company for its employees unless otherwise
            specifically provided in such plan.

XIII. Participant's Rights

Establishment of the Plan shall not be construed to give any Participant the
right to be retained in the Company's or an Affiliate's service or to any
benefits not specifically provided by the Plan. A Participant shall not have any
interest in the deferred compensation and earnings credited to his Account, Gain
Share Account, and/or Restricted Stock Unit Account until such accounts are
distributed in accordance with the Plan. All amounts deferred or otherwise held
for the account of a Participant under the Plan shall remain the sole property
of the Company, subject to the claims of its general creditors and available for
its use for whatever purposes are desired. With respect to amounts deferred or
otherwise held for the account of a Participant, the Participant is merely a
general creditor of the Company; and the obligation of the Company hereunder is
purely contractual and shall not be funded or secured in any way. At its
discretion, the Company may establish one or more grantor trusts to assist the
Company in accumulating the funds needed to meets its obligation under the Plan.

In case the claim of any Participant or beneficiary for benefits under the Plan
is denied, the Committee shall provide adequate notice in writing to such
claimant, setting forth the specific reasons for such denial. The notice shall
be written in a manner calculated to be understood by the claimant. The
Committee shall afford a Participant or beneficiary whose claim for benefits has
been denied 60 days from the date notice of such denial is delivered or mailed
in which to appeal the decision in writing to the Committee. If the Participant
or beneficiary appeals the decision in writing within 60 days, the Committee
shall review the written comments and any submissions of the Participant or
beneficiary and render its decision regarding the appeal all within 60 days of
such appeal.

                                      -15-

<PAGE>

XIV.  Non-alienability and Non-transferability

The rights of a Participant to the payment of deferred compensation as provided
in the Plan shall not be assigned, transferred, pledged or encumbered, or be
subject in any manner to alienation or anticipation. No Participant may borrow
against his Account, Gain Share Account, and/or Restricted Stock Unit Account.
No Account, Gain Share Account, and/or Restricted Stock Unit Account shall be
subject in any manner to anticipation, alienation, sale, transfer, assignment,
pledge, encumbrance, charge, garnishment, execution, or levy of any kind,
whether voluntary or involuntary, including any liability which is for alimony
or other payments for the support of a spouse or former spouse, or for any other
relative of any Participant.

XV.    Statement of Account

Statements will be sent to Participants within 60 days after the end of each
calendar quarter as to the balance in their deferred compensation Accounts, Gain
Share Accounts, and/or Restricted Stock Unit Accounts as of the end of such
calendar quarter.

XVI.   Administration

The Administrator of the Plan shall be the Benefits Administrative Committee of
the Company or any successor committee (the "Committee"). The Committee shall
have authority to adopt rules and regulations for carrying out the Plan and to
interpret, construe, and implement the provisions thereof. Any decision or
interpretation of any provision of the Plan adopted by the Committee shall be
final and conclusive.

XVII.  Amendment and Termination

The Plan may, at any time, be amended, modified, or terminated by the Board of
Directors of the Company. No amendment, modification, or termination shall,
without the consent of a Participant, adversely affect such Participant's right
with respect to amounts accrued in his or her deferred compensation Account,
Gain Share Account, and/or Restricted Stock Unit Account.

XVIII. General Provisions

       A.    Notices. All notices to the Committee hereunder shall be delivered
             to the attention of the Secretary of the Committee. Any notice or
             filing required or permitted to be given to the Committee under
             this Plan shall be sufficient if in writing and hand delivered, or
             sent by registered or certified mail, to the Committee at the
             principal office of the Company. Such notice shall be deemed given
             as of the date of delivery or, if delivery is made by mail, as of
             the date shown on the postmark or the receipt for registration or
             certification.

       B.    Controlling Law. Except to the extent superseded by federal law,
             the laws of the state of North Carolina shall be controlling in all
             matters relating to the Plan.

       C.    Gender and Number. Where the context admits, words in the masculine
             gender shall include the feminine and neuter genders, the plural
             shall include the singular and the singular shall include the
             plural.

                                      -16-

<PAGE>

      D.    Captions. The captions of sections and paragraphs of this Plan are
            for convenience only and shall not control or affect the meaning of
            construction of any of its provisions.

      E.    Action by the Company. Any action required or permitted by the
            Company under the Plan shall be by resolution of its Board of
            Directors or any person or persons authorized by resolution of its
            Board of Directors.

      F.    Facility of Payment. Any amounts payable hereunder to any person
            under legal disability or who, in the judgment of the Committee is
            unable to properly manage his financial affairs may be paid to the
            legal representative of such person or may be applied for the
            benefit of such person in any manner which the Committee may select.

      G.    Withholding Payroll Taxes. To the extent required by the laws in
            effect at the time amounts are deferred or deferred compensation
            payments are made, the Company shall withhold (from other
            compensation in the case of deferrals) any taxes required to be
            withheld for federal, state, or local government purposes.

      H.    Severability. Whenever possible, each provision of the Plan shall be
            interpreted in such manner as to be effective and valid under
            applicable law (including the Internal Revenue Code), but if any
            provision of the Plan shall be held to be prohibited by or invalid
            under applicable law, then (a) such provision shall be deemed
            amended to, and to have contained from the outset such language as
            shall be necessary to, accomplish the objectives of the provision as
            originally written to the fullest extent permitted by law and (b)
            all other provisions of the Plan shall remain in full force and
            effect.

      I.    No Strict Construction. No rule of strict construction shall be
            applied against the Company, the Board of Directors, Committee or
            any other person in the interpretation of any of the terms of the
            Plan or any rule or procedure established by the Company or
            Committee.

      J.    Successors. The provisions of the Plan shall bind and inure to the
            benefit of the Company and its Affiliates and their successors and
            assigns. The term "successors" as used herein shall include any
            corporation or other business entity which shall by merger,
            consolidation, purchase, or otherwise, acquire all or substantially
            all of the business and assets of the Company and successors of any
            such corporation or other business entity.

XIX.  Unfunded State of the Plan

Any and all payments made to the Participant pursuant to the Plan shall be made
only from the general assets of the Company, or at the discretion of the
Company, such payments shall be made from a grantor trust established by the
Company. All accounts under the Plan shall be for bookkeeping purposes only and
shall not represent a claim against specific assets of the Company. Nothing
contained in this Plan shall be deemed to create a trust of any kind or create
any fiduciary relationship.

                                      -17-

<PAGE>

IN WITNESS WHEREOF, Pharmaceutical Product Development, Inc. has caused its
corporate seal to be hereunto affixed and has caused its name to be signed
hereto by its Chief Executive Officer and attested by its Secretary, pursuant to
due authority of its Board of Directors as of this 1st day of July, 2002.



                                   By:  /s/ Fredric N. Eshelman
                                        ----------------------------------------
                                        Chief Executive Officer
                                        Pharmaceutical Product Development, Inc.



(Corporate Seal)

Attest:


/s/ B. Judd Hartman
--------------------------------------
Secretary

                                      -18-