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                                                                   EXHIBIT 10.31

November 16, 2001


Robert B. Stein
[ADDRESS]

Dear Bob:

It is with great pleasure that we offer you the position of President and Chief
Scientific Officer of Incyte Genomics, Inc. ("Incyte" or the "Company"),
reporting to the Chief Executive Officer of the Company.

1. Salary and Bonus. Should you accept our offer, your salary will be $500,000
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per year, payable on a bi-weekly basis. This is a salaried, exempt position, as
your salary covers compensation for all hours worked. Your salary will be
subject to annual review by the Compensation Committee of the Board of
Directors, with the first such review to occur at the Compensation Committee's
regularly scheduled meeting for that purpose in the last quarter of 2002 or the
first quarter of 2003, as applicable. In addition, beginning fiscal year 2002
you will participate together with the Company's other executive officers in the
Company's Corporate Incentive Plan ("CIP"). Under the CIP, your target bonus
will be 50% of your annual salary, with the actual bonus amount determined by
the achievement of performance goals to be determined annually by the Board of
Directors.

2. Stock Options and Restricted Stock Units. Incyte will grant you an option to
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purchase 250,000 shares of Incyte common stock at an exercise price equal to the
fair market value of the common stock on the date of grant, which will occur on
the date of your commencement of employment with the Company. Twenty-five
percent (25%) of this option will vest on the first anniversary of the date of
grant, with the remaining seventy-five percent (75%) of the option vesting
monthly in thirty-six equal increments beginning in the month immediately
following the first anniversary of the date of grant. The specific terms and
conditions of this grant will be set forth in a Stock Option Agreement to be
entered into between you and the Company. Your stock options will be "incentive
stock options" to the maximum extent permitted by law. Upon the commencement of
your employment, you will also receive 50,000 restricted stock units (the
"Units"). Each Unit will enable you to receive one share of Incyte common stock.
The Units will vest on the fourth anniversary of your employment or on such
earlier date as provided in the Employment Agreement, dated November 26, 2001,
between the Company and you (the "Employment Agreement"). Upon your termination
of employment, unvested Units will be forfeited. The Units will be settled in
shares of Incyte common stock on the date of vesting or such later date, but not
beyond the earlier of 30 days after the termination of your employment or the
ninth anniversary of the date you commence your employment with the Company, as
you may elect in a timely deferral election filed with the Company.

3. Place of Performance and Loan for Personal Residence. Your principal place of
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employment with the Company will be the Company's headquarters, currently Palo
Alto, California. The Company will pay all of your reasonable expenses to move
you and your family and your household goods from Delaware to California. The
Company will also provide you and your family with $60,000 to be used for
temporary housing and renting related expenses in the Palo Alto vicinity. As an
inducement to move your principal residence to California, the Company will
offer you a non-interest bearing (subject to paragraph (d) below) loan of up to





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November 16, 2001
Robert B. Stein
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$750,000 (the "Loan") to purchase a new home (the "Residence") pursuant to the
following conditions:

         a.       The Loan will be recourse to you and secured by the Residence
                  (if, in addition to the Loan, you secure financing from a
                  financial institution to purchase the Residence, the Loan may
                  be second in priority only to such mortgage from a financial
                  institution), but the Loan (or the Loan and any such other
                  financing) cannot exceed 90% of the purchase price of the
                  Residence;

         b.       You will certify to the Company that you reasonably expect to
                  be entitled to and will in fact itemize your deductions for
                  each year the Loan is outstanding;

         c.       50% of the Loan will be forgiven on the third anniversary of
                  the date you commence your employment with the Company and the
                  remaining 50% of the Loan will be forgiven on the fourth
                  anniversary of such date, provided that you are still employed
                  with the Company on such days; and

         d.       (i)   If your employment is terminated for Cause (as defined
                  in the Employment Agreement) or you leave employment of the
                  Company on your own volition without Good Reason or Change in
                  Control Good Reason (as defined in the Employment Agreement),
                  any unpaid balance of the Loan will be due 30 days after
                  termination of your employment and will bear interest at the
                  relevant applicable federal rate retroactive from the date the
                  Loan is made; and

                  (ii)  If your employment is terminated without Cause or you
                  leave employment of the Company with Good Reason or Change in
                  Control Good Reason or due to death or Disability (as defined
                  in the Employment Agreement), any unpaid balance of the Loan
                  will be due one year after termination of your employment; and

                  (iii) If you sell the Residence and do not purchase another
                  home in the Palo Alto area or in another area that the Board
                  of Directors requests you to relocate of equal or greater
                  value within 3 months of the sale of the Residence, the unpaid
                  balance of the Loan will be immediately due and payable.

4. Election to Board of Directors. Upon your acceptance of the position of
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President and Chief Scientific Officer, subject to the necessary Board of
Directors approval and effective upon commencement of your employment, you will
be elected as a member of the Company's Board of Directors.




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November 16, 2001
Robert B. Stein
Page 3


5. Benefits. Incyte offers employees and their eligible dependents a variety of
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group health insurance benefits. Effective on your first day of employment, you
will be eligible for these benefits which currently include medical, dental,
vision, disability and life insurance. An outline of our benefit package is
enclosed. Incyte offers a 401(k) Plan available for your participation at the
next open enrollment, held quarterly. Information about these programs and other
company benefits along with guidelines concerning employment are contained in
Incyte's Employee Handbook, a copy of which is issued at the time employment
commences.

6. Corporate Policy. As a condition of your employment with Incyte, you are
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required to sign the enclosed Confidential Information and Invention Assignment
Agreement ("Confidential Information Agreement") protecting Incyte's proprietary
and competitive information. This offer of employment is subject to your
acceptance of the terms of the Confidential Information Agreement. As an Incyte
employee, you will be responsible for carrying out your duties and upholding all
Company policies as outlined in the Company Employee Handbook and in the
Confidential Information Agreement, as may be modified from time to time.

7. Term of Employment. Please note that your employment with Incyte, if
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accepted, will commence on December 3, 2001 and will be on an "at will" basis,
meaning that either you or the Company can terminate the employment relationship
for any reason at any time.

8. Severance. If your employment with the Company is terminated without Cause or
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for Good Reason or Change in Control Good Reason, you will be entitled to
receive the severance benefits described in the Employment Agreement.

9. Immigration Documentation. This offer of employment is expressly conditioned
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upon your being able to provide Incyte with documentation on the date that you
report to work as evidence that you are fully authorized by the INS to accept
this employment position. This offer of employment is contingent on the Company
receiving satisfactory background checks.

Bob, we would be delighted by your decision to join Incyte and we look forward
to your acceptance of this offer of employment. We believe Incyte offers an
exciting and challenging opportunity.

Please consider our offer and advise me of your decision by December 3, 2001.
The Company does not intend to hold the offer open beyond this date.




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November 16, 2001
Robert B. Stein
Page 4




In order to confirm your agreement with and acceptance of these terms, please
sign one copy of this letter and return it to me along with your signed
Employment Agreement, Confidential Information Agreement, Computer Usage Policy,
EEO form and I-9. The Confidential Information Agreement must be returned with a
signed copy of this letter to be considered a valid acceptance. The other copy
of this offer letter is for your records. In the meantime, should you have any
questions about our offer or about the Company more generally, please contact
me.

Sincerely,


/s/  Roy A. Whitfield
Roy A. Whitfield
Chief Executive Officer



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I have read and understand the terms of this offer including the attached
Confidential Information Agreement. I agree to the terms of employment set forth
in this letter and Confidential Information Agreement and will be available to
report to work on Monday, December 3, 2001.

                                                       /s/ Robert B. Stein
                                                    ----------------------------
                                                       Robert B. Stein