EMPLOYMENT AGREEMENT

     This Employment Agreement (this "Agreement"), dated as of June 12, 1998, is
entered into by and between Aronex Pharmaceuticals, Inc., a Delaware corporation
(the "Company"), and Praveen Tyle, Ph.D. (the "Executive").

                                   WITNESSETH:

     WHEREAS,  the Company  desires to employ the  Executive,  and the Executive
desires  to  continue  in the  employment  of the  Company,  upon the  terms and
conditions and in the capacities set forth herein;

     NOW,  THEREFORE,  in  consideration  of the premises and for other good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged, the Company and the Executive hereby agree as follows:

     1.  Employment and Term of Employment.  Subject to the terms and conditions
of this  Agreement,  the Company hereby agrees to employ the Executive,  and the
Executive hereby agrees to serve the Company, as Vice President,  Pharmaceutical
Development  and Operations for a term (the "Term of  Employment")  beginning on
the date  first  set  forth  above  (the  "Effective  Date")  and  ending on the
Expiration Date (defined below).  As used in this Agreement,  "Expiration  Date"
means  the  first  anniversary  of the  Effective  Date,  provided  that on each
anniversary of the Effective Date (each such anniversary  being referred to as a
"Renewal  Date"),  the  Expiration  Date  shall be  automatically  extended  one
additional  year  unless,  not less than 10 days prior to the  relevant  Renewal
Date, (i) either party shall have given written notice to the other that no such
automatic  extension  shall  occur  after the date of such notice or (ii) either
party shall have given a Notice of  Termination to the other pursuant to Section
5 hereof. Notwithstanding the foregoing, if either party gives a valid Notice of
Termination  pursuant  to  Section 5 hereof,  the Term of  Employment  shall not
extend beyond the termination date specified in such Notice of Termination.

     2. Scope of Employment.  (a) During the Term of  Employment,  the Executive
agrees to (i) serve as Vice President, Pharmaceutical Development and Operations
of the  Company  and shall  have and may  exercise  all the  powers,  duties and
functions as are normal and customary to such  position and that are  consistent
with the  responsibilities  set  forth  with  respect  to such  position  in the
Company's  by-laws and (ii) perform such other duties not inconsistent  with his
position as are  assigned to him,  from time to time,  by the Board of Directors
(the  "Board") or Chief  Executive  Officer of the  Company.  During the Term of
Employment,  the Executive shall devote  substantially all of his business time,
attention,  skill  and  efforts  to  the  faithful  performance  of  his  duties
hereunder.  Provided that the Executive  complies with the foregoing  obligation
and the other  obligations set forth in this Agreement,  the Executive may serve
on a Scientific  Advisory  Board or in a similar role for one or more  companies
other than the Company.

          (b) During the Term of Employment,  the Executive  agrees to serve, if
     elected,  as an officer or director of any  subsidiary  or affiliate of the
     Company so long as such service is commensurate  with the Employee's duties
     and responsibilities to the Company.

     3.  Compensation.  During the Term of Employment,  in  consideration of the
Executive's  services hereunder,  including,  without limitation,  service as an
officer or director of the Company or of any  subsidiary  or affiliate  thereof,
and in consideration of the Executive's  agreements set forth in the Proprietary
Information  and Inventions and  Non-Competition  Agreement  dated March 5, 1998
between  the  Executive  and  the  Company  (the  "Proprietary  Information  and
Inventions Agreement"):


<PAGE>



          (a) the Executive  shall receive a salary at a rate  equivalent to the
     Executive's  current annual salary in effect on the Effective Date (payable
     at such regular intervals as other employees of the Company are compensated
     in accordance with the Company's employment practices),  which salary shall
     be  subject  to review  annually  by the Board and may be  adjusted  at its
     discretion, provided that such salary may not be reduced at any time.

          (b) the Executive shall be entitled to receive an annual cash bonus of
     up to 20% of the  Executive's  salary  based upon the  achievement  of such
     milestones as may be agreed upon by the Executive and the Board.

     4. Additional Compensation and Benefits. (a) As additional compensation for
the Executive's services under this Agreement and the Executive's agreements set
forth in the Proprietary  Information and Inventions Agreement,  during the Term
of  Employment,  the Company  agrees to provide the Executive  with the non-cash
benefits provided by the Company to its other officers and key employees as they
may exist from time to time.  Such benefits shall include such leave or vacation
time (not less than three weeks),  medical and dental insurance,  life insurance
and other health care benefits,  and  retirement and disability  benefits as may
hereafter be provided by the Company in accordance with its policies, as well as
any  stock  option  plan or  similar  employee  benefit  program  for  which key
executives are or shall become eligible.

          (b) The Executive is authorized to incur reasonable  business expenses
     for  promoting  the  business  and  reputation  of the  Company,  including
     (without limitation) reasonable expenditures for travel, lodging, meals and
     client,  patron,  customer and/or  business  associate  entertainment.  The
     Company  shall  reimburse  the  Executive  within  30 days  for  reasonable
     expenses  incurred  by  the  Executive  in  furtherance  of  the  Company's
     business,  provided that such expenses are incurred in accordance  with the
     Company's  policies and upon  presentation of  documentation  in accordance
     with expense  reimbursement  policies of the Company as they may exist from
     time to time,  and submission to the Company of adequate  documentation  in
     accordance  with  federal  income  tax   regulations   and   administrative
     pronouncements.

     5. Termination.

          (a) General. The Executive's  employment hereunder shall automatically
     terminate on the earlier of his death or the Expiration Date. The Executive
     may, at any time prior to the  Expiration  Date,  terminate his  employment
     hereunder  for any reason by  delivering a Notice of  Termination  (defined
     below) to the Board.  The Company may, at any time prior to the  Expiration
     Date,  terminate  the  Executive's  employment  hereunder for any reason by
     delivering a Notice of Termination to the Executive. The giving of a notice
     pursuant to clause (i) of the proviso contained in the penultimate sentence
     of Section I hereof shall not be deemed a  termination  of the  Executive's
     employment  by the party  giving such  notice.  As used in this  Agreement,
     "Notice of Termination"  means a notice in writing  purporting to terminate
     the Executive's  employment in accordance with this Section 5, which notice
     shall (i) specify the effective date of such  termination (not prior to the
     date of such notice) and (ii) in the case of a  termination  by the Company
     for Cause or Disability or a termination by the Executive for Disability or
     Good  Reason (in each case as such terms are defined  below),  set forth in
     reasonable  detail  the  reason  for such  termination  and the  facts  and
     circumstances claimed to provide a basis for such termination.



<PAGE>



          (b) Automatic  Termination on Expiration  Date or Death.  In the event
     the Executive's  employment hereunder shall automatically  terminate on the
     Expiration  Date or as a result of the  Executive's  death,  the  Executive
     shall only be entitled to receive, to the extent applicable, (i) all unpaid
     compensation  accrued  as of the  termination  date  pursuant  to Section 3
     hereof,  (ii) all unused  vacation  time accrued by the Executive as of the
     termination  date,  (iii) all amounts owing to the Executive  under Section
     4(b)  hereof and (iv) those  benefits  under  Section 4 which are  required
     under the  Employee  Retirement  Income  Security  Act of 1974,  as amended
     ("ERISA"),  or other laws.  The amounts  described in clauses (i), (ii) and
     (iii) of the  foregoing  sentence  shall be paid to the Executive in a lump
     sum payment promptly after the Expiration Date.

          (c)  Termination by Company for Cause.  If the Company  terminates the
     Executive's  employment for Cause,  the Executive shall only be entitled to
     receive the  compensation  and other  payments  described in paragraph  (b)
     above,  such  compensation  and  other  payments  to  be  paid  as  if  the
     Executive's  employment had automatically  terminated without the giving of
     any Notice of Termination.  As used in this  Agreement,  "Cause" shall mean
     (i) any material  failure of the Executive to perform his duties  specified
     in Section 2 of this Agreement (other than any such failure  resulting from
     the Executive's  incapacity due to Disability) after written notice of such
     failure has been given to the Executive by the Board or the Company's Chief
     Executive  Officer and such failure shall have  continued for 30 days after
     receipt of such notice,  (ii) gross  negligence  or willful or  intentional
     wrongdoing or misconduct,  (iii) a material  breach by the Executive of the
     Proprietary  Information  and Inventions and  Non-Competition  Agreement of
     even  date  herewith  between  the  Execution  e and  the  Company  or  any
     subsequent  such agreement  between the Executive and the Company,  or (iv)
     conviction of the Executive of a felony offense or a crime  involving moral
     turpitude.

          (d)  Termination  for  Disability.   To  provide  for  the  event  the
     Executive's employment is terminated by either the Company or the Executive
     on account of Disability  (defined below), the Company shall provide or, as
     applicable,   cause  its  disability  insurance  carrier  to  provide,  the
     Executive  such  disability  benefits as may  hereafter  be provided by the
     Company in  accordance  with its  policies,  as they may exist from time to
     time. As used herein,  "Disability"  means any physical or mental condition
     of the Executive that (i) prevents the Executive from being able to perform
     the services required under this Agreement, (ii) has continued for at least
     180  consecutive  days during any 12- month period and (iii) is  reasonably
     expected to continue.

          (e) Termination by Company  Without Cause.  If the Company  terminates
     the  Executive's  employment  for any  reason  other  than for  Cause or on
     account of Disability, the Company shall:

               (i) pay to the Executive,  for the period of 12 months commencing
          on the date of such  termination,  an amount equal to the  Executive's
          then current annual salary  (payable at such regular  intervals as the
          employees  of the  Company  are  compensated  in  accordance  with the
          Company's employment practices);

               (ii)  pay the  Executive  the  compensation  and  other  payments
          described in paragraph (b) above; and

               (iii)  continue,  for the period of 12 months  commencing  on the
          date of such  termination,  to provide the  benefits  contemplated  by
          Section 4(a) of this Agreement (provided that the continuation of such
          benefits  shall be  construed  so as not to extend the  period  during
          which the  Company  shall be required  to provide  benefits  under the
          Consolidated  Omnibus  Budget  Reconciliation  Act of  1985  ("COBRA")
          following the date of such termination).


<PAGE>



          (f)  Termination by the Executive  with Good Reason.  If the Executive
     terminates his employment for Good Reason (as defined  below),  the Company
     shall:

               (i) pay to the Executive,  for the period of 24 months commencing
          on the date of such  termination,  an amount equal to the  Executive's
          then current annual salary  (payable at such regular  intervals as the
          employees  of the  Company  are  compensated  in  accordance  with the
          Company's employment practices);

               (ii)  pay the  Executive  the  compensation  and  other  payments
          described in paragraph (b) above; and

               (iii)  continue,  for the period of 12 months  commencing  on the
          date of such  termination,  to provide the  benefits  contemplated  by
          Section 4(a) of this Agreement (provided that the continuation of such
          benefits  shall be  construed  so as not to extend the  period  during
          which the Company  shall be required to provide  benefits  under COBRA
          following the date of such termination).

As used in this Agreement, "Good Reason" shall mean a material diminution in the
title,  powers,  duties,  responsibilities  or  functions  of the  Executive  as
described in Section 2 hereof  within one year  following  the  occurrence  of a
Change of Control.

As used in this Agreement, a "Change of Control" shall mean:

               (i) the  acquisition  after the Effective Date by any individual,
          entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of
          the  Securities  Exchange  Act of 1934,  as amended) (a  "Person")  of
          beneficial ownership of 50% or more of either (i) the then outstanding
          shares of common stock of the Company (the "Outstanding Common Stock")
          or (ii) the  combined  voting  power of the  then  outstanding  voting
          securities of the Company  entitled to vote  generally in the election
          of directors (the "Outstanding Voting Securities"),  provided that for
          purposes of this subsection (i), the following  acquisitions shall not
          constitute a Change of Control:  (A) any acquisition directly from the
          Company,  (B) any  acquisition by the Company,  (C) any acquisition by
          any employee  benefit plan (or related trust)  sponsored or maintained
          by the Company or any  corporation  controlled by the Company,  or (D)
          any  acquisition by any  corporation  pursuant to a transaction  which
          complies with clauses (A), (B) and (C) of subsection (ii) hereof; or

               (ii)  consummation  after the Effective Date of a reorganization,
          merger  or  consolidation  or  sale  or  other  disposition  of all or
          substantially   all  of  the  assets  of  the  Company  (a  "Corporate
          Transaction")   in  each  case,   unless,   following  such  Corporate
          Transaction,  (A) (1) all or substantially all of the persons who were
          the  beneficial  owners of the  Outstanding  Common Stock  immediately
          prior to such  Corporate  Transaction  beneficially  own,  directly or
          indirectly,  more  than 50% of the then  outstanding  shares of common
          stock of the  corporation  resulting from such Corporate  Transaction,
          and  (2)  all or  substantially  all  of  the  persons  who  were  the
          beneficial  owners of the Outstanding  Voting  Securities  immediately
          prior to such  Corporate  Transaction  beneficially  own,  directly or
          indirectly,  more than 50% of the  combined  voting  power of the then
          outstanding  voting  securities  entitled  to  vote  generally  in the
          election of directors of the corporation resulting from such Corporate
          Transaction (including,  without limitation,  a corporation which as a
          result of such  transaction  owns the Company or all or  substantially
          all of the  Company's  assets  either  directly or through one or more
          subsidiaries) in substantially the same proportions as their ownership
          of the Outstanding  Common Stock and the Outstanding Voting Securities
          immediately prior to such Corporate  Transaction,  as the case may be,
          (B) no  Person  (excluding  (1) any  corporation  resulting  from such
          Corporate  Transaction or any employee benefit plan (or related trust)
          of the  Company  orsuch  corporation  resulting  from  such  Corporate
          Transaction and (2) any Person approved by the members of the Board in
          office immediately prior to such Corporate  Transaction)  beneficially
          owns,  directly  or  indirectly,  50% or more of the then  outstanding
          shares  of  common  stock  of  the  corporation  resulting  from  such
          Corporate  Transaction  or the  combined  voting  power  of  the  then
          outstanding voting securities of such corporation except to the extent
          that such ownership  existed prior to such Corporate  Transaction  and
          (C) at least a majority  of the members of the board of  directors  of
          the corporation resulting from such Corporate Transaction were members
          of the Board at the time of the execution of the initial  agreement or
          of the action of the Board providing for such Corporate Transaction.
<PAGE>
     6.  Non-exclusivity  of Rights.  Nothing in this Agreement shall prevent or
limit the Executive's continuing or future participation in any benefit,  bonus,
incentive  or  other  plan or  program  provided  by the  Company  or any of its
affiliated companies and for which the Executive may qualify, nor shall anything
herein limit or otherwise affect such rights as the Executive may have under any
stock  option or other  agreements  with the  Company  or any of its  affiliated
companies. Amounts which are vested benefits or which the Executive is otherwise
entitled  to  receive  under any plan or  program  of the  Company or any of its
affiliated  companies  at or  subsequent  to  the  date  of  termination  of the
Executive's  employment under this Agreement shall be payable in accordance with
such plan or program.

     7. Resolution of Disputes.

          (a) Negotiate.  The parties shall attempt in good faith to resolve any
     dispute  arising  out  of  or  relating  to  this  Agreement   promptly  by
     negotiations  between the Executive and an executive officer of the Company
     who has authority to settle the  controversy.  Any party may give the other
     party written  notice of any dispute not reveled in the normal course of
     business.  Within 10 days after the  effective  date of such  notice,  the
     Executive and an executive  officer of the Company shall meet at a mutually
     acceptable time and place within the Houston,  Texas metropolitan area, and
     thereafter as often as they reasonably deem necessary, to exchange relevant
     information  and to attempt to resolve the  dispute.  If the matter has not
     been resolved  within 30 days of the disputing  party's  notice,  or if the
     parties fail to meet within 10 days, either party may initiate  arbitration
     of the  controversy  or  claim as  provided  hereinafter.  If a  negotiator
     intends to be accompanied at a meeting by an attorney, the other negotiator
     shall be given at least three  business  days notice of such  intention and
     may also be accompanied by an attorney.  All negotiations  pursuant to this
     Section 7(a) shall be treated as compromise and settlement negotiations for
     the purposes of the federal and state rules of evidence and procedure.

          (b)  Arbitration.  Any  dispute  arising  out of or  relating  to this
     Agreement or the breach,  termination  or validity  thereof,  which has not
     been  resolved by  non-binding  means as provided in Section 7(a) within 60
     days of the  initiation  of such  procedure,  shall be  finally  settled by
     arbitration  conducted  expeditiously  in  accordance  with the  Center for
     Public Resources,  Inc. ("CPR") Rules for  Non-Administered  Arbitration of
     Business Disputes by three independent and impartial  arbitrators,  of whom
     each party shall appoint one,  provided that if one party has requested the
     other to participate in a non-binding procedure and the other has failed to
     participate,  the  requesting  party may  initiate  arbitration  before the
     expiration of such period.  Any such arbitration shall take place in Harris
     County,  Texas.  Any arbitrator not appointed by a party shall be appointed
     from the CPR Panels of Neutrals.  The arbitration  shall be governed by the
     United States  Arbitration Act and any judgment upon the award decided upon
     by the arbitrators may be entered by any court having jurisdiction thereof.
     Each party hereby  acknowledges that compensatory  damages include (without
     limitation) any benefit or right of indemnification  given by another party
     to the other under this Agreement


<PAGE>




     8.  GOVERNING  LAW.  This  Agreement  shall be governed by and construed in
accordance with the internal laws of the State of Texas.  Venue and jurisdiction
of any act on relating to this agreement  shall lie in Harris County,  Texas. 

     9.  Notice.  Any  notice,  payment,  demand or  communication  required  or
permitted  to  be  given  by  this  Agreement  shall  be  deemed  to  have  been
sufficiently given or served for all purposes if delivered personally or if sent
by registered or certified  mall,  return receipt  requested,  postage  prepaid,
addressed to such party at its address set forth below such party's signature to
this  Agreement or to such other address as shall have been furnished in writing
by such party for whom the  communication is intended.  Any such notice shall be
deemed to be given on the date so delivered.

     1O.  Severability.  In the event any provisions hereof shall he modified or
held ineffective by any court, such adjudication  shall not invalidate or render
ineffective the balance of the provisions hereof.

     11.  Entire  Agreement.  This  Agreement,  together  with  the  Proprietary
Information and Inventions Agreement, constitutes the sole agreement between the
parties  with  respect to the  employment  of the  Executive  by the Company and
supersedes any and all other agreements, oral or written, between the parties.

     12.  Amendment  and Waiver.  This  Agreement may not be modified or amended
except by a writing  signed by the  parties.  Any waiver or breach of any of the
terms of this  Agreement  shall not  operate as a waiver of any other  breach of
such  terms or  conditions,  or any  other  terms or  conditions,  nor shall any
failure to enforce any  provisions  hereof operate as a waiver of such provision
or any other provision hereof.

     13. Assignment.  This Agreement is a personal  employment  contract and the
rights and  interests of the Executive  hereunder may not be sold,  transferred,
assigned or pledged.  The Company may assign its rights under this  Agreement to
(i) any entity  into or with which the Company is merged or  consolidated  or to
which the Company  transfers all or substantially  all of its assets or (ii) any
entity, which at the time of such assignment  controls,  is under common control
with, or is  controlled  by the Company,  provided that the Company will require
any successor (whether direct or indirect, by purchase, merger, consolidation or
otherwise)  to all or  substantially  all of the business  and/or  assets of the
Company,  by  agreement  in form  and  substance  reasonably  acceptable  to the
Executive,  to expressly  assume and agree to perform this Agreement in the same
manner and to the same extent  that the Company  would be required to perform it
if not such succession had taken place.

     14.  Successors.  This  Agreement  shall be  binding  upon and inure to the
benefit of the  Executive  and his heirs,  executors,  administrators  and legal
representatives.  This Agreement  shall be binding upon and inure to the benefit
of the Company and its successors and assigns.

     15.  Section  Headings.  The section  headings in this  Agreement have been
inserted for convenience and shall not be used for  interpretive  purposes or to
otherwise construe this Agreement.


<PAGE>


     IN WITNESS  WHEREOF,  the parties hereto have executed this Agreement as of
he date first written above and intended that this  Agreement have the effect of
a sealed instrument.

                                               By: /S/PRAVEEN TYLE, Ph.D.
                                               --------------------------
                                               Praveen Tyle, Ph.D.


                                               ARONEX PHARMACEUTICALS, INC.

                                               By: /S/GEOFFREY F. COX, Ph.D.
                                               -----------------------------
                                               Geoffrey F. Cox, Ph.D.
                                               Chief Executive Officer