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                [General Electric Capital Corporation Letterhead]



                                                                   JULY 11, 2003


Ms. Vivian Liu
Vice President, Corporate Affairs
NexMed, Inc.
350 Corporate Boulevard
Robbinsville, NJ 08691

Dear Ms. Liu:

Pursuant to your request, General Electric Capital Corporation ("GECC") is
pleased to submit the following lease proposal for your consideration:

LESSEE:                            NexMed, Inc.

LESSOR:                            GE Capital or one of its wholly-owned
                                   subsidiaries.


EQUIPMENT:                         New laboratory (greater than or equal
                                   to 80%), general office and computer hardware
                                   equipment (less than or equal to 10%), and
                                   related soft costs such as taxes,
                                   installation, and freight (less than or
                                   equal to 10%) for the internal use of the
                                   Lessee. All Equipment must be acceptable to
                                   Lessor.

EQUIPMENT LOCATION:                All within the continental United States.
                                   Anticipated locations are at the Lessee's
                                   headquarters at the above address or at its
                                   East Windsor, NJ facility.

EQUIPMENT COST:                    $1,850,000.00

DELIVERY ASSUMPTIONS:              January 2003 through July 2004

LEASE TERM:                        36 months

BASIC TERM
COMMENCEMENT DATES:                Lessee shall make its first rental
                                   payment(s) in advance. Such advance rental
                                   payment(s) shall be due upon execution of
                                   documents.

RENTAL PAYMENT RATE:               3.093023% of the Equipment Cost per month.

LEASE EXPIRATION
PURCHASE OPTION:                   $1.00


This proposal is based upon the following additional terms and conditions:
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PURCHASE OF EQUIPMENT:              Lessee would submit its order for the
                                    equipment to the vendor. Lessor would take
                                    an assignment of Lessee's purchase order.
                                    Such assignment would be conditioned upon
                                    the leasing of the Equipment by Lessee from
                                    Lessor. Lessee understands that any
                                    Equipment delivered after the Last Delivery
                                    Date would not be covered by this proposal.

NET LEASE:                          The proposed lease would be a net lease.
                                    Without limiting the generality of the
                                    foregoing, Lessee would be responsible for
                                    all expenses, maintenance, insurance and
                                    taxes relating to the purchase, lease,
                                    possession and use of the Equipment.

INSURANCE:                          Lessee would bear all risk of loss or damage
                                    to the Equipment. Lessee would be
                                    responsible to keep the Equipment insured
                                    with companies acceptable to Lessor and for
                                    such amounts required by Lessor, including,
                                    but not limited to, insurance for damage to
                                    or loss of the Equipment and liability
                                    coverage. All such insurance policies must
                                    be satisfactory to Lessor.

WARRANTIES:                         Lessor would lease the Equipment to Lessee
                                    on an AS IS BASIS. However, Lessor would
                                    assign to Lessee all warranties, guarantees
                                    and services provided by the manufacturer or
                                    vendor (to the extent that they are
                                    assignable).

DOCUMENTATION AND
TRANSACTIONAL COSTS:                Standard GECC Master Lease and Lease
                                    Schedule for this type of equipment would be
                                    utilized. Any changes to the documents must
                                    be approved by GECC legal counsel. Lessee
                                    will be responsible for all costs associated
                                    with the transaction including any appraisal
                                    fees, inspection costs or legal expenses.

RATE INDEX:                         The above Rental Factor assumes a three
                                    (3)-year Treasury Note yield of 1.79%. Prior
                                    to Schedule funding, Lessor may adjust the
                                    Rental Rate in order to maintain its
                                    originally anticipated rate of return if
                                    there is an increase in the three (3)-year
                                    Treasury Note yield. The effective Rental
                                    Rate will remain fixed for the duration of
                                    each Schedule.

PROPOSAL FEE:                       A Proposal Fee of $18,500.00 shall be due
                                    upon acceptance of this proposal to begin
                                    the investment approval process. Of this
                                    fee, $13,500.00 shall be credited on a
                                    prorata basis to schedules as financed and
                                    the remainder shall be retained by GE
                                    Capital for documentation, underwriting and
                                    application processing. All or a portion of
                                    said fee shall be forfeited if this
                                    transaction is approved by GE Capital and
                                    not executed by Lessee as called for in this
                                    proposal. If investment approval is not
                                    obtained, the fee will be promptly returned
                                    to Lessee (less the cost of cost of credit
                                    verification and investigation and any out
                                    of pocket expenses incurred such as
                                    appraisal fees, legal fees, etc).

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This letter is an expression by GECC of its interest in considering a lease
transaction on the general terms and conditions outlined above. Except for the
provisions concerning the Proposal Fee (set forth above), this letter is not
intended to and does not create any binding legal obligation on the part of
either party. THIS LETTER IS NOT, AND IS NOT TO BE CONSTRUED AS, A COMMITMENT BY
GECC OR ANY OF ITS SUBSIDIARIES TO ENTER INTO THE PROPOSED LEASE TRANSACTION.
Neither GECC nor its subsidiary will be obligated to provide any financing until
the satisfactory completion of its investment review and analysis and a field
audit, the receipt of all requisite approvals by GECC management, and the prior
execution and delivery of final legal documentation acceptable to all parties
and their counsel.

Please acknowledge your consent to the terms outlined above by signing a copy of
this letter and returning it with your check for the Proposal Fee before July
23, 2003.


Sincerely,                                  ACCEPTED: NexMed, Inc.

/s/ William B. Stickle                      By: /s/ Mark Westgate
                                                -------------------------

William B. Stickle                          Title:  Controller
Vice President - Sales                            -----------------------
                                            Date:   July 14, 2003
                                                 ------------------------
                                            Federal Tax ID No.:87-0449967
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