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                                                                     EXHIBIT 4.3

                              COMMON STOCK WARRANT

NEITHER THIS WARRANT NOR THE SECURITIES ISSUABLE UPON EXERCISE OF THIS WARRANT
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. NO SALE OR
DISPOSITION MAY BE EFFECTED EXCEPT IN COMPLIANCE WITH RULE 144 UNDER SAID ACT OR
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR AN OPINION OF
COUNSEL FOR THE HOLDER, SATISFACTORY TO THE COMPANY, THAT SUCH REGISTRATION IS
NOT REQUIRED UNDER THE ACT OR RECEIPT OF A NO-ACTION LETTER FROM THE SECURITIES
AND EXCHANGE COMMISSION.

                 WARRANT TO PURCHASE 451 SHARES OF COMMON STOCK

                                                         Dated: October 28, 2003

THIS CERTIFIES THAT, for value received, Oxford Finance Corporation, ("Holder")
is entitled to subscribe for and purchase Four Hundred Fifty One (451) shares of
the fully paid and nonassessable Common Stock (the "Shares") of Vanda
Pharmaceuticals Inc., a Delaware corporation (the "Company"), at the Warrant
Price (as hereinafter defined), subject to the provisions and upon the terms and
conditions hereinafter set forth. As used herein, the term "Common Stock" shall
mean the Company's presently authorized Class A Common Stock, and any stock into
which such Common Stock may hereafter be exchanged.

1. Warrant Price. The Warrant Price shall initially be Forty and 00/100 dollars
($40.00) per share, subject to adjustment as provided in Section 7 below.

2. Conditions to Exercise. The purchase right represented by this Warrant may be
exercised at any time, or from time to time, in whole or in part during the term
commencing on the date hereof and ending on the earlier of:

      (a)   5:00 P.M. Eastern Standard time on the eighth annual anniversary of
            this Warrant Agreement; or

      (b)   The closing of the initial public offering of the Company's Common
            Stock pursuant to a registration statement under the Securities Act
            of 1933, as amended (the "Initial Public Offering"). The Company
            shall provide notice of the Initial Public Offering to the Holder at
            least 10 business days prior to the closing thereof; or

      (c)   The effective date of the merger of the Company with or into, the
            consolidation of the Company with, or the sale by the Company of all
            or substantially all of its assets or all or substantially all of
            its shares to another corporation or other entity (other than such a
            transaction wherein the shareholders of the Company retain or obtain
            a majority of the voting capital stock of the surviving, resulting,
            or purchasing corporation); provided that the Company shall notify
            the registered Holder of this Warrant of the proposed effective date
            of the merger, consolidation, or sale at least 10 business days
            prior to the effectiveness thereof.


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In the event that, although the Company shall have given notice of a transaction
pursuant to subparagraph (b) or subparagraph (c) hereof, the transaction does
not close within 60 days of the day specified by the Company, unless otherwise
elected by the Holder any exercise of the Warrant subsequent to the giving of
such notice shall be rescinded and the Warrant shall again be exercisable until
terminated in accordance with this Paragraph 2.

3. Method of Exercise; Payment; Issuance of Shares; Issuance of New Warrant.

      (a)   Cash Exercise. Subject to Section 2 hereof, the purchase right
            represented by this Warrant may be exercised by the Holder hereof,
            in whole or in part, by the surrender of this Warrant (with a duly
            executed Notice of Exercise in the form attached hereto) at the
            principal office of the Company (as set forth below) and by payment
            to the Company, by check, of an amount equal to the then applicable
            Warrant Price per share multiplied by the number of shares then
            being purchased. In the event of any exercise of the rights
            represented by this Warrant, certificates for the shares of stock so
            purchased shall be in the name of, and delivered to, the Holder
            hereof (subject to the terms of transfer contained herein and upon
            payment by such Holder hereof of any applicable transfer taxes).
            Such delivery shall be made within 10 days after exercise of the
            Warrant and at the Company's expense and, unless this Warrant has
            been fully exercised or expired, a new Warrant having terms and
            conditions substantially identical to this Warrant and representing
            the portion of the Shares, if any, with respect to which this
            Warrant shall not have been exercised, shall also be issued to the
            Holder hereof within 10 days after exercise of the Warrant.

      (b)   Net Issue Exercise. In lieu of exercising this Warrant pursuant to
            Section 3(a), Holder may elect to receive shares equal to the value
            of this Warrant (or of any portion thereof remaining unexercised) by
            surrender of this Warrant at the principal office of the Company
            together with notice of such election, in which event the Company
            shall issue to Holder the number of shares of the Company's Common
            Stock computed using the following formula:

                   X = Y (A-B)
                       -------
                          A

                  Where X = the number of shares of Common Stock to be issued to
                  Holder.

                  Y = the number of shares of Common Stock purchasable under
                  this Warrant (at the date of exercise).

                  A = the Fair Market Value of one share of the Company's Common
                  Stock (at the date of exercise).

                  B = Warrant Price (as adjusted to the date of exercise).

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      (c)   Fair Market Value. For purposes of this Section 3, Fair Market Value
            of one share of the Company's Common Stock shall mean:

                  (i) In the event of an exercise in connection with an Initial
                  Public Offering, the per share Fair Market Value for the
                  Common Stock shall be the Offering Price at which the
                  underwriters initially sell Common Stock to the public; or

                  (ii) The average of the closing bid and asked prices of the
                  Common Stock quoted in the Over-The-Counter Market Summary, or
                  the average of, the last reported sale price of the Common
                  Stock or the closing price quoted on the Nasdaq National
                  Market System ("NMS") or on any exchange on which the Common
                  Stock is listed, whichever is applicable, as published in The
                  Wall Street Journal over the ten (10) trading days prior to
                  the date of determination of fair market value; or

                  (iii) In the event of an exercise in connection with a merger,
                  acquisition or other consolidation in which the Company is not
                  the surviving entity, as described in Section 2(c), the per
                  share Fair Market Value for the Common Stock shall be the
                  value to be received per share of Common Stock by all holders
                  of the Common Stock in such transaction as determined by the
                  Board of Directors; or

                  (iv) If the Common Stock is not publicly traded, the per share
                  fair market value of the Common Stock shall be as determined
                  in good faith by the Company's Board of Directors unless
                  Holder elects to have such fair market value determined by an
                  appraiser selected by the Company, which election must be made
                  by Holder within ten (10) business days of the date the
                  Company notifies Holder of the fair market value as determined
                  by its Board of Directors. In the event of such an appraisal,
                  the cost thereof shall be borne by the Holder unless such
                  appraisal results in a fair market value in excess of 115% of
                  that determined by the Company's Board of Directors, in which
                  event the Company shall bear the cost of such appraisal.

                  In the event of 3(c)(iii) or 3(c)(iv), above, the Company
                  shall deliver to the Holder a certificate setting forth in
                  reasonable detail the basis for and method of determination of
                  the per share Fair Market Value of the Common Stock. Such
                  certificate must be made to Holder at least 10 business days
                  prior to the proposed effective date of the merger,
                  consolidation, sale, or other triggering event as defined in
                  3(c)(iii) and 3(c)(iv).

      (d)   Automatic Exercise. To the extent this Warrant is not previously
            exercised, it shall be automatically exercised in accordance with
            Sections 3(b) and 3(c) hereof (even if not surrendered) immediately
            before: (i) its expiration, or (ii) the consummation of any
            consolidation or merger of the Company, or any sale or transfer of a
            majority of the Company's assets or stock pursuant to Section 2(b)
            and 2(c).

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4. Representations and Warranties of Holder and Restrictions on Transfer Imposed
by the Securities Act of 1933.

      (a)   Representations and Warranties by Holder. The Holder represents and
            warrants to the Company with respect to this purchase as follows:

                  (i) The Holder has substantial experience in evaluating and
                  investing in private placement transactions of securities of
                  companies similar to the Company so that the Holder is capable
                  of evaluating the merits and risks of its investment in the
                  Company and has the capacity to protect its interests.

                  (ii) The Holder is acquiring the Warrant and the Shares of
                  Common Stock issuable upon exercise of the Warrant
                  (collectively, the "Securities") for investment for its own
                  account and not with a view to, or for resale in connection
                  with, any distribution thereof. The Holder understands that
                  the Securities have not been registered under the Securities
                  Act of 1933, as amended (the "Act") by reason of a specific
                  exemption from the registration provisions of the Act, which
                  depends upon, among other things, the bona fide nature of the
                  investment intent as expressed herein. In this connection, the
                  Holder understands that, in the view of the Securities and
                  Exchange Commission (the "EC"), the statutory basis for such
                  exemption may be unavailable if this representation was
                  predicated solely upon a present intention to hold the
                  Securities for the minimum capital gains period specified
                  under tax statutes, for a deferred sale, for or until an
                  increase or decrease in the market price of the Securities or
                  for a period of one year or any other fixed period in the
                  future.

                  (iii) The Holder acknowledges that the Securities must be held
                  indefinitely unless subsequently registered under the Act or
                  an exemption from such registration is available. The Holder
                  is aware of the provisions of Rule 144 promulgated under the
                  Act ("Rule 144") which permits limited resale of securities
                  purchased in a private placement subject to the satisfaction
                  of certain conditions, including, in case the securities have
                  been held for more than one but less than two years, the
                  existence of a public market for the shares, the availability
                  of certain public information about the Company, the resale
                  occurring not less than one years after a party has purchased
                  and paid for the security to be sold, the sale being through a
                  "broker's transaction" or in a transaction directly with a
                  "market maker" (as provided by Rule 144(f)) and the number of
                  shares or other securities being sold during any three-month
                  period not exceeding specified limitations.

                  (iv) The Holder further understands that at the time the
                  Holder wishes to sell the Securities there may be no public
                  market upon which such a sale may be effected, and that even
                  if such a public market exists, the Company may not be
                  satisfying the current public information requirements of Rule
                  144, and that in such event, the Holder may be precluded from
                  selling the Securities under Rule 144 unless a) a one-year
                  minimum holding period has been satisfied and b) the Holder
                  was not


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                  at the time of the sale nor at any time during the three-month
                  period prior to such sale an affiliate of the Company.

                  (v) The Holder has had an opportunity to discuss the Company's
                  business, management and financial affairs with its management
                  and an opportunity to review the Company's facilities. The
                  Holder understands that such discussions, as well as the
                  written information issued by the Company, were intended to
                  describe the aspects of the Company's business and prospects
                  which it believes to be material but were not necessarily a
                  thorough or exhaustive description. The Company makes no
                  representation or warranty to Holder with respect to any
                  thereof.

      (b)   Legends. Each certificate representing the Securities shall be
            endorsed with the following legend:

                        THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE
                        SECURITIES ACT OF 1933 AND MAY NOT BE TRANSFERRED UNLESS
                        COVERED BY AN EFFECTIVE REGISTRATION STATEMENT UNDER
                        SAID ACT, A "NO ACTION" LETTER FROM THE SECURITIES AND
                        EXCHANGE COMMISSION WITH RESPECT TO SUCH TRANSFER, A
                        TRANSFER MEETING THE REQUIREMENTS OF RULE 144 OF THE
                        SECURITIES AND EXCHANGE COMMISSION, OR (IF REASONABLY
                        REQUIRED BY THE COMPANY) AN OPINION OF COUNSEL
                        SATISFACTORY TO THE ISSUER TO THE EFFECT THAT ANY SUCH
                        TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

                  The Company need not enter into its stock register a transfer
                  of Securities unless the conditions specified in the foregoing
                  legend are satisfied. The Company may also instruct its
                  transfer agent not to register the transfer of any of the
                  Shares unless the conditions specified in the foregoing legend
                  are satisfied.

      (c)   Removal of Legend and Transfer Restrictions. The legend relating to
            the Act endorsed on a certificate pursuant to paragraph 4(b) of this
            Warrant and the stop transfer instructions with respect to the
            Securities represented by such certificate shall be removed and the
            Company shall issue a certificate without such legend to the Holder
            of the Securities if (i) the Securities are registered under the Act
            and a prospectus meeting the requirements of Section 10 of the Act
            is available or (ii) the Holder provides to the Company an opinion
            of counsel for the Holder reasonably satisfactory to the Company, or
            a no-action letter or interpretive opinion of the staff of the SEC
            reasonably satisfactory to the Company, to the effect that public
            sale, transfer or assignment of the Securities may be, to the effect
            that public sale, transfer or assignment of the Securities may be
            made without registration and without compliance with any
            restriction such as Rule 144.


<PAGE>


5. Condition of Transfer or Exercise of Warrant. It shall be a condition to any
transfer or exercise of this Warrant that at the time of such transfer or
exercise, the Holder shall provide the Company with a representation in writing
that the Holder or transferee is acquiring this Warrant and the shares of Common
Stock to be issued upon exercise, for investment purposes only and not with a
view to any sale or distribution, or will provide the Company with a statement
of pertinent facts covering any proposed distribution. As a further condition to
any transfer of this Warrant or any or all of the shares of Common Stock
issuable upon exercise of this Warrant, other than a transfer registered under
the Act, the Company must have received a legal opinion, in form and substance
satisfactory to the Company and its counsel, reciting the pertinent
circumstances surrounding the proposed transfer and stating that such transfer
is exempt from the registration and prospectus delivery requirements of the Act.
Each certificate evidencing the shares issued upon exercise of the Warrant or
upon any transfer of the shares (other than a transfer registered under the Act
or any subsequent transfer of shares so registered) shall, at the Company's
option, contain a legend in form and substance satisfactory to the Company and
its counsel, restricting the transfer of the shares to sales or other
dispositions exempt from the requirements of the Act.

As further condition to each transfer, the Holder shall surrender this Warrant
to the Company and the transferee shall receive and accept a Warrant, of like
tenor and date, executed by the Company.

6. Stock Fully Paid; Reservation of Shares. All Shares which may be issued upon
the exercise of the rights represented by this Warrant will, upon issuance and
payment of the exercise price therefor, be fully paid and nonassessable, and
free from all taxes, liens, and charges with respect to the issue thereof.
During the period within which the rights represented by this Warrant may be
exercised, the Company will at all times have authorized, and reserved for
issuance upon exercise of the purchase rights evidenced by this Warrant, a
sufficient number of shares of its Common Stock to provide for the exercise of
the rights represented by this Warrant.

7. Adjustment for Certain Events. In the event of changes in the outstanding
Common Stock by reason of stock dividends, split-ups, reclassifications,
recapitalizations, mergers, consolidations, combinations or exchanges of shares,
reorganizations, liquidations, or the like, the number and class of shares
available under the Warrant in the aggregate and the Warrant Price shall be
correspondingly adjusted, as appropriate, by the Board of Directors of the
Company. The adjustment shall be such as will give the Holder of this Warrant
upon exercise for the same aggregate Warrant Price the total number, class and
kind of shares as he would have owned had the Warrant been exercised prior to
the event and had he continued to hold such shares until after the event
requiring adjustment.

8. Notice of Adjustments. Whenever any Warrant Price shall be adjusted pursuant
to Section 7 hereof, the Company shall prepare a certificate signed on the
Company's behalf by the chief financial officer of the Company setting forth, in
reasonable detail, the event requiring the adjustment, the amount of the
adjustment, the method by which such adjustment was calculated, and the Warrant
Price and number of shares issuable upon exercise of the Warrant after giving
effect to such adjustment, and shall cause copies of such certificate to be
mailed (by certified or


<PAGE>

registered mail, return receipt required, postage prepaid) within thirty (30)
days of such adjustment to the Holder of this Warrant as set forth in Section 18
hereof.

9. "Market Stand-Off" Agreement. Holder hereby agrees that for a period of up to
180 days following the effective date of the first registration statement of the
Company covering common stock (or other securities) to be sold on its behalf of
the Company in an underwritten public offering, it will not, to the extent
requested by the Company and any underwriter, sell or otherwise transfer or
dispose of (other than to donees or transferees who agree to be similarly bound)
any of the Shares at any time during such period except common stock included in
such registration.

10. Transferability of Warrant. This Warrant is transferable on the books of the
Company at its principal office by the registered Holder hereof upon surrender
of this Warrant properly endorsed, subject to compliance with Section 5 and
applicable federal and state securities laws. Notwithstanding the previous
sentence, this Warrant is transferable to affiliates of Oxford Finance
Corporation only after the Holder gives at least three (3) days' prior notice to
the Board of Directors of the Company. The Company shall issue and deliver to
the transferee a new Warrant representing the Warrant so transferred. Upon
partial transfer, the Company will issue and deliver to the Holder a new Warrant
with respect to the Warrant not so transferred. Holder shall not have any right
to transfer any portion of this Warrant to any direct competitor of the Company.

11. No Fractional Shares. No fractional share of Common Stock will be issued in
connection with any exercise hereunder, but in lieu of such fractional share the
Company shall make a cash payment therefor upon the basis of the Warrant Price
then in effect.

12. Charges, Taxes and Expenses. Issuance of certificates for shares of Common
Stock upon the exercise of this Warrant shall be made without charge to the
Holder for any United States or state of the United States documentary stamp tax
or other incidental expense within respect to the issuance of such certificate,
all of which taxes and expenses shall be paid by the Company, and such
certificates shall be issued in the name of the Holder.

13. No Shareholder Rights Until Exercise. This Warrant does not entitle the
Holder hereof to any voting rights or other rights as a shareholder of the
Company prior to the exercise hereof.

14. Loss, Theft, Destruction or Mutilation of Warrant. Upon receipt by the
Company of evidence reasonably satisfactory to it of the loss, theft,
destruction or mutilation of this Warrant, and, in the case of loss, theft, or
destruction, of indemnity reasonably satisfactory to it, and, if mutilated, upon
surrender and cancellation of this Warrant, the Company will execute and deliver
a new Warrant, having terms and conditions substantially identical to this
Warrant, in lieu hereof.

15. Registry of Warrant. The Company shall maintain a registry showing the name
and address of the registered Holder of this Warrant. This warrant may be
surrendered for exchange or exercise, in accordance with its terms, at such
office or agency of the Company, and the

<PAGE>


Company and Holder shall be entitled to rely in all respects, prior to written
notice to the contrary, upon such registry.

16. Miscellaneous.

      (a)   Issue Date. The provisions of this Warrant shall be construed and
            shall be given effect in all respect as if it had been issued and
            delivered by the Company on the date hereof.

      (b)   Successors. This Warrant shall be binding upon any successors or
            permitted assigns of the Company.

      (c)   Governing Law. This Warrant shall be governed by and construed in
            accordance with the laws of the State of Maryland.

      (d)   Headings. The headings used in this Warrant are used for convenience
            only and are not to be considered in construing or interpreting this
            Warrant.

      (e)   Saturdays, Sundays, Holidays. If the last or appointed day for the
            taking of any action or the expiration of any right required or
            granted herein shall be a Saturday or a Sunday or shall be a legal
            holiday in the State of Maryland, then such action may be taken or
            such right may be exercised on the next succeeding day not a legal
            holiday.

17. No Impairment. The Company shall not by any action including, without
limitation, amending its Sections or certificate of incorporation or by-laws,
any reorganization, transfer of assets, consolidation, merger, share exchange
dissolution, issue or sale of securities or any other voluntary action, avoid or
seek to avoid the observance or performance of any of the terms of the Warrants,
but shall at all times in good faith assist in the carrying out of all such
terms and in the taking of all such actions as may be necessary or appropriate
to protect the rights of the Holder(s) hereof against impairment. Without
limiting the generality of the foregoing, the Company shall (a) not increase the
par value of any shares of Common Stock issuable upon the exercise of the
Warrants above the amount payable therefor upon such exercise, (b) take all such
action as may be necessary or appropriate in order that the Company may validly
issue fully paid and nonassessable shares of Common Stock upon the exercise of
the Warrants, (c) obtain all such authorizations, exemptions or consents from
any public regulatory body having jurisdiction thereof as may be necessary to
enable the Company to perform its obligations under the Warrants and (d) not
take or permit to be taken any action which would have the effect of shortening
the period provided herein for exercise of the Warrants.

18. Addresses. Any notice required or permitted hereunder shall be in writing
and shall be mailed by overnight courier, registered or certified mail, return
receipt required, and postage prepaid, or otherwise delivered by hand or by
messenger, addressed as set forth below, or at such other address as the Company
or the Holder hereof shall have furnished to the other party.



<PAGE>


          If to the                Vanda Pharmaceuticals Inc.
          Company:
                                   9620 Medical Center Drive, Suite
                                   201,
                                   Rockville, MD 20850
                                   Attn: Chief Executive Officer

          If to the Holder:        Oxford Finance Corporation
                                   133 N. Fairfax Street
                                   Alexandria, VA 22314
                                   Attn: Chief Financial Officer

IN WITNESS WHEREOF, Vanda Pharmaceuticals Inc. has caused this Warrant to be
executed by its officers thereunto duly authorized.

Dated as of October 28, 2003.

By: /s/ William D. Clark
    ---------------------------
Name: William D. Clark

Title: Director

<PAGE>


                               NOTICE OF EXERCISE

TO: ________________________
    ________________________
    ________________________

1. The undersigned, Oxford Finance Corporation ("Holder") elects to acquire
shares of the Common Stock of Vanda Pharmaceuticals Inc. (the "Company"),
pursuant to the terms of the Stock Purchase Warrant dated October 28, 2003 (the
"Warrant").

2. The Holder exercises its rights under the Warrant as set forth below:

   (   )      The Holder elects to purchase_____ shares of Common Stock as
              provided in Section 3(a), (c) and tenders herewith a check in the
              amount of $_____ as payment of the purchase price.

   (   )      The Holder elects to convert the purchase rights into shares of
              Common Stock as provided in Section 3(b), (c) of the Warrant.

3. The Holder surrenders the Warrant with this Notice of Exercise.

4. The Holder represents that it is acquiring the aforesaid shares of Common
Stock for investment and not with a view to or for resale in connection with,
distribution and that the Holder has no present intention of distributing or
reselling the shares.

5. Please issue a certificate representing the shares of Common Stock in the
name of the Holder or in such other name as is specified below:

            Name:         ___________________________

            Address:      ___________________________

            Taxpayer ID.: ___________________________



<PAGE>


         Oxford Finance Corporation

By:    ________________________________

Name:  ______________________________

Title: _____________________________

Date:  ______________________________