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                                                                    EXHIBIT 10.7

                               CELL PATHWAYS, INC.

                        INCENTIVE STOCK OPTION AGREEMENT

         STOCK OPTION AGREEMENT ("Agreement") made as of November 29, 2000 by
and between CELL PATHWAYS, INC., a Delaware corporation ("Company"), and
_______, a resident of the State of Pennsylvania ("Grantee").

         The Parties Hereto Do Hereby Agree As Follows:

         1. Grant of Option. The Company considers it desirable and in its best
interest that Grantee as an employee and/or director of the Company be given an
inducement to acquire a proprietary interest in the Company and an added
incentive to advance the interests of the Company by being granted an option to
purchase shares of the Company's Common Stock, $0.01 par value ("Common Stock"),
in accordance with the Company's 1997 Equity Incentive Plan, as amended (the
"Plan"). In consideration of Grantee's rendering services ("Services") as an
employee, director and/or consultant of the Company during the requisite vesting
periods, and in further consideration of the agreements set forth herein, the
Company therefore hereby grants to Grantee the right, privilege and option
("Option") to purchase an aggregate of ____ shares of Common Stock (the
"Optioned Shares") at the price ("Exercise Price") of $ ____per share thereof,
in the manner and subject to the conditions hereinafter provided. This Option
shall be treated as an incentive stock option under the Internal Revenue Code of
1986, as amended (the "Code").

         2. Option Exercise Period. This Option may be exercised, with respect
to vested shares, from the time such shares have vested pursuant to Section 3
hereof until the termination of the option pursuant to Section 5 hereof. This
option shall not be exercisable under this Section 2 to the extent such exercise
would cause the aggregate fair market value of any shares subject to incentive
stock options granted to Grantee by the Company or any affiliate (valued as of
their grant date) which would become exercisable for the first time during any
calendar year to exceed $100,000.

         3. Option Vesting Period. The Optioned Shares shall vest based upon the
following fifty (50) month schedule:

                  a. First Anniversary: On the last business day prior to the
         first anniversary of the date of this Agreement, twenty-four percent
         (24%) of the Optioned Shares shall vest, provided that Grantee
         continues to render Services to the Company or a subsidiary of the
         Company on such date. Failure of the Grantee to continue to render
         Services to the Company or a subsidiary during the period ending on the
         last business day prior to said first anniversary shall mean that no
         Optioned Shares shall vest, regardless of whether the cessation of
         Services is at the election of the Grantee for any reason, is at the
         election of the Company for any reason, or is the result of death,
         disability or other intervening cause.

                  b. Monthly Vesting Thereafter: After the first anniversary of
         the date of this Agreement, another two percent (2%) of the Optioned
         Shares will vest at the end of each succeeding month, provided that
         Grantee continues to render Services to the Company or a subsidiary of
         the Company on such date. If Grantee shall not continue to render
         Services to the Company or a subsidiary for the full fifty (50) month
         vesting period, there shall be vested


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         at the cessation of Services only those Optioned Shares which were
         vested as of the last vesting event (first anniversary or last full
         completed month after the first anniversary).

         4. Method of Exercise. As to those Optioned Shares that have vested,
the Option may be exercised by the Grantee executing, dating and delivering to
the Secretary of the Company at the Company's principal place of business a
written Option Exercise Notice in the form of Exhibit A attached hereto,
accompanied by a check made payable to the Company in the amount of the
aggregate Exercise Price for the number of shares for which the Option is then
being exercised. If the Company is required to withhold on account of any
present or future tax imposed as a result of such exercise, the notice of
exercise shall be accompanied by a check made payable to the Company in the
amount of such withholding.

         5. Termination of Option. Except as otherwise stated in this Agreement
or as the parties may otherwise agree, the Option (to the extent not theretofore
exercised) shall terminate and expire at 5:00 p.m., Philadelphia time, on the
first to occur of (i) the day immediately prior to the 10th anniversary of the
date of this Agreement, and (ii) the ninetieth day following the day on which
Grantee ceases for any reason to render Services to the Company or its
subsidiaries

         6. Transfer of Option. Grantee may not transfer this Option except by
will or the laws of descent and distribution. This Option shall not be otherwise
sold, assigned, pledged, hypothecated or otherwise transferred or disposed of in
any way, whether by operation of law or otherwise, and during the Grantee's
lifetime shall be exercisable only by the Grantee or his guardian or legal
representative.

         7. Capitalization Adjustments. Subject to the provisions of the Plan,
if the outstanding shares of stock or other securities of the class then subject
to the Option are increased or decreased, or are changed into or exchanged for a
different number or kind of Company shares or other Company securities, in any
such case as a result of one or more recapitalizations, stock splits, reverse
stock splits, stock dividends or the like, then appropriate adjustments shall be
made in the number and/or kind of Company shares or other Company securities for
which the unexercised portion of this Option may thereafter be exercised, all
without any change in the aggregate Exercise Price applicable to the unexercised
portion of the Option, but with a corresponding adjustment in the Exercise Price
per share of other unit. No fractional share of Company stock shall be issued
under the Option in connection with any such adjustment. Such adjustments shall
be made by or under authority of the Company's Board of Directors or duly
authorized Committee thereof, whose determinations as to what adjustments shall
be made, and the extent thereof, shall be final, binding and conclusive.

         8. Certain Transactions. If at any time while this Option remains
outstanding:

                                       2.
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                  a. any "person" (as such term is used in Sections 13(d) and
         14(d) of the Exchange Act) other than the Company, any trustee or other
         fiduciary holding securities under an employee benefit plan of the
         Company, any person acquiring securities from the Company solely
         pursuant to written agreement with the Company, or any corporation
         owned, directly or indirectly, by the stockholders of the Company in
         substantially the same proportions as their ownership of stock in the
         Company, is or becomes the "beneficial owner" (as defined in Rule 13d-3
         under the Exchange Act), directly or indirectly, of securities of the
         Company representing 20% or more of the combined voting power of the
         Company's then outstanding securities, or

                  b. during any period of two consecutive years commencing the
         day after the first election of directors following termination of the
         stockholder voting provisions of the Company's Stockholders' Agreement
         dated as of December 10, 1992, as amended, individuals who at the
         beginning of such period constitute the Board, and any new director
         (other than a director designated by a person who has entered into an
         agreement with the Company to effect a transaction described in clauses
         (a), (c) or (d) of this Section) whose election by the Board or
         nomination for election by the Company's stockholders was approved by a
         vote of at least two-thirds of the directors then still in office who
         either were directors at the beginning of the period or whose election
         or nomination for election was previously so approved, cease for any
         reason to constitute at least a majority thereof, or

                  c. the stockholders of the Company approve a merger or
         consolidation of the Company with any other corporation, other than a
         merger or consolidation where no person within the meaning of
         subsection (a) above becomes the "beneficial owner" (as defined above)
         of 20% or more of the resulting voting power and where the voting
         securities of the Company outstanding immediately prior thereto
         continue to represent (either by remaining outstanding or by being
         converted into voting securities of the surviving or controlling
         entity) more than 50% of the combined voting power of the voting
         securities of the Company or such surviving or controlling entity
         outstanding immediately after such merger or consolidation, or

                  d. the stockholders of the Company approve a plan of complete
         liquidation of the Company or an agreement for the sale or disposition
         by the Company of all or substantially all of the Company's assets,

(each of (a), (b), (c) and (d) above, an "Acceleration Event"), then the Option
shall become vested and may be exercised as to all Optioned Shares for which it
has not previously been exercised, and all Optioned Shares for which the Option
has been exercised but which have not yet vested shall vest.

         Upon the occurrence of an Acceleration Event the Company's Stock Option
Committee shall provide for cancellation of the unexercised portion of the
Option as of the Cancellation Date; provided, however, that (i) if the Option
has been held for less than six months then for purposes of such cancellation
the Acceleration Event and/or Cancellation Date shall be restricted in such
manner as the Company's Stock Option Committee may determine necessary to comply
with the conditions and requirements of Rule 16b-3; (ii) in the event of a
transaction described in clause (c) that is

                                       3.
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treated as a pooling of interests for accounting purposes, if required for such
accounting treatment, outstanding options shall not be cancelled but, instead,
the surviving corporation (or the parent of the surviving corporation) shall
assume outstanding options (or grant options in substitution for the outstanding
options) on terms comparable to the outstanding options; and (iii) in the event
of a transaction described in clause (c) that is not treated as a pooling of
interests for accounting purposes, the Committee may determine that outstanding
options will not be cancelled and that the surviving corporation (or the parent
of the surviving corporation) shall assume outstanding options (or grant options
in substitution for the outstanding options) on terms comparable to the
outstanding options.

         "Cancellation Date" shall mean (i) the 60th day following the
occurrence of any Acceleration Event described in clause (a) or (b) of the first
sentence hereof, and (ii) the closing of any merger, consolidation, liquidation
or sale of assets stockholder approval of which constituted an Acceleration
Event under clause (c) or (d) of the first sentence hereof. Upon cancellation of
the Option pursuant to an Acceleration Event under clause (a), (b) or (d) of the
first sentence hereof, the Company shall make, and upon cancellation of the
Option following an Acceleration Event under clause (c) of the first sentence
hereof, the Company may make, in exchange therefor, a cash payment under the
Option in an amount equal to the product of the number of Optioned Shares
covered by the unexercised portion of the Option multiplied by the difference
between the Exercise Price and (i) in the case of a transaction described in
clause (a) or (b) of the first sentence hereof, the highest fair market value of
an Optioned Share at any time during the 60-day period immediately preceding the
Cancellation Date, and (ii) in the case of a transaction described in clause (c)
or (d) of the first sentence hereof, the fair market value of an Optioned Share
on the Cancellation Date. The "fair market value" of Optioned Shares shall be
determined by the Company's Stock Option Committee by reference to any national
securities market on which the Optioned Shares may then be trading, or as
otherwise determined by the Company's Stock Option Committee.

         9. Securities Laws. Grantee hereby represents and agrees for himself,
and for his transferees by will or the laws of descent and distribution, that
unless a registration statement under the Securities Act of 1933, as amended, is
in effect as to shares purchased upon any exercise of the Option, (i) any and
all shares so purchased shall be acquired for his personal account and not with
a view to or for sale in connection with any distribution, and (ii) each notice
of the exercise of any portion of the Option shall be accompanied by a
representation and warranty in writing, signed by the person entitled to
exercise the same, that the shares are being so acquired in good faith for his
personal account and not with a view to or for sale in connection with any
distribution. Notwithstanding anything else contained in this Agreement, no
share of stock or other securities shall be issued pursuant to any exercise of
the Option unless and until, in the opinion of counsel for the Company, such
securities may be issued and delivered without causing the Company to be in
violation of or incur any liability under any federal, state or other securities
laws, any requirement of any securities exchange listing agreement to which the
Company may be a party, or any other requirement of law or of any regulatory
body having jurisdiction over the Company.

         10. Stock Restrictions. No shares of stock or other securities issued
upon exercise of the Option may be sold, assigned, pledged, hypothecated or
otherwise transferred or disposed of in any way unless and until, in the opinion
of counsel for the Company, such securities may be so transferred

                                       4.
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or disposed of without causing the Company to be in violation of or incur any
liability under any federal, state or other securities laws, any requirement of
any securities exchange listing agreement to which the Company may be a party,
or any other requirement of law or of any regulatory body having jurisdiction
over the Company.

         11. Restrictive Legends. Unless and until otherwise permitted by this
Section 11, or unless in the opinion of counsel for the Company such legend is
not required, each certificate for stock or other securities issued pursuant to
exercise of this Option shall be stamped or otherwise imprinted with a legend in
substantially the following form:

         "THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
         UNDER THE SECURITIES ACT OF 1933, ARE HELD FOR INVESTMENT PURPOSES ONLY
         AND MAY NOT BE SOLD, TRANSFERRED OR DISTRIBUTED AT ANY TIME UNLESS A
         REGISTRATION STATEMENT IS FILED WITH THE SECURITIES AND EXCHANGE
         COMMISSION PURSUANT TO THE SECURITIES ACT OF 1933 COVERING SUCH SHARES
         OR UNLESS, IN THE OPINION OF COUNSEL FOR THE COMPANY, SUCH A
         REGISTRATION STATEMENT IN NOT REQUIRED".

The Company may order its stock transfer agents to stop the transfer of any
shares of stock or other securities bearing the legend set forth in this Section
11 until the conditions of Section 10 hereof with respect to the transfer of
such stock or other securities have been satisfied.

         12. Stock Option Plan. The Option is subject to, and the Company and
Grantee agree to be bound by, all of the terms and conditions of the Plan
(including the clarifying amendment considered by the Committee on November 29,
2000 and adopted by the Board on January 10, 2001), as the same shall have been
amended from time to time in accordance with the terms thereof, provided that no
such amendment shall deprive Grantee, without his consent, of this Option or any
of his rights hereunder. Pursuant to the Plan, the Company's Stock Option
Committee is vested with final authority to interpret and construe the Plan and
the Option, and is authorized to adopt rules and regulations for carrying out
the Plan. A copy of the Plan in its present form is available for inspection
during business hours by Grantee or other persons entitled to exercise this
Option at the Company's principal office.

         13. No Employment or Stockholder Rights. Neither this Agreement nor the
establishment of the Plan shall be construed to (i) give Grantee any right to
become employed by, or continue to be an employee or director of, or consultant
to, the Company or any of its subsidiaries, (ii) give Grantee any benefits not
specifically provided by this Agreement, or (iii) in any manner limit the right
of the Company or any of its subsidiaries to modify, amend or terminate the Plan
or any of its other benefit plans. Employment may be terminated by the Grantee
or by the Company at any time for any reason, in which event shares will vest or
fail to vest in accordance with Section 3 hereof. Grantee shall not have any
rights as a stockholder of the Company with respect to any of the Optioned
Shares until such time as such shares have been issued upon exercise.

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         14. Notices. Any notice to be given to the Company shall be addressed
to the Company in care of its Secretary at its principal office, and any notice
to be given to Grantee shall be addressed to him at the address given beneath
his signature hereto or at such other address as Grantee may hereafter designate
in writing to the Company.

         15. Governing Law. This Agreement shall be governed by the laws of the
State of Delaware, other than its conflict of laws provisions.

         IN WITNESS WHEREOF, the Company has entered into this Agreement and
granted the Option as of the date of this Agreement first written above.

                            CELL PATHWAYS, INC.


                            By__________________________________________________
                            Martha E. Manning
                            Senior Vice President, General Counsel and Secretary



                            ACCEPTED:

                            ____________________________________________________


                            ____________________________________________________
                            Street Address


                            ____________________________________________________
                            City and State


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EXHIBIT A

                             OPTION EXERCISE NOTICE

To:  Cell Pathways, Inc.

Attention:  Secretary

         The undersigned hereby exercises his/her option to acquire shares of
Common Stock (the "Securities") pursuant to the option granted to the
undersigned in that certain Stock Option Agreement (the "Agreement") dated
             , 19__, by and between Cell Pathways, Inc. (the "Company") and the
undersigned, and in connection with this exercise does hereby tender herewith as
provided in the Agreement the full Exercise Price (as defined in the Agreement)
with respect to the Securities, and does hereby represent and warrant to the
Company that the Securities are being acquired in good faith for the
undersigned's own account and not with a view to or for sale in connection with
any distribution.

         IN WITNESS WHEREOF, the undersigned has signed this Option Exercise
Notice as of the date written below.

                           ____________________________________________________
                           Signature


                           ____________________________________________________
                           Print Name


                           ____________________________________________________
                           Date


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