EXHIBIT 10.29

November 28,
2001

VIA
HAND DELIVERY

Mr. Ken
Kelley

Dear
Ken:

As
we have discussed, the following sets forth the terms and conditions of the separation and consulting agreement between you and Intrabiotics Pharmaceuticals, Inc. (the
"Company"):

1.    Employment Resignation.Although you have resigned your employment with the Company effective January 31, 2002 (the
"Separation Date"), until then you will be on a paid leave of absence, and, except as specified in this Agreement, you will not be authorized to work or represent the Company in any manner beginning
November 29, 2001. You and the Company agree that each will notify third parties (including prospective employers) that your employment was terminated due to your resignation. In addition, we
agree that your employment termination will be deemed a "Constructive Termination" for the purposes of the Intrabiotics Pharmaceuticals, Inc. Senior Executive Severance Benefit Plan (the
"Severance Plan"), a copy of which is attached hereto as Exhibit A, and the 2001 Officer Incentive Bonus Plan (the "Bonus Plan"), a copy of which is attached hereto as Exhibit B.

2.    Resignation as Director.You agree to resign as a member of the Company's Board of Directors (the "Board"), effective as
of November 29, 2001, by submitting your resignation in a letter (in the form attached hereto as Exhibit C) to the Acting Chairman of the Board at the same time that you sign this
Agreement.

3.    Accrued Salary and Paid Time Off.On the Separation Date, the Company will pay you all accrued salary, and all accrued and
unused vacation earned through the Separation Date, subject to standard payroll deductions and withholdings and reduced by the amount of any withholding obligation arising under and pursuant to
Section 4(b) below. You are entitled to these payments by law.

4.    Bonus Plan.Although you have not met all of the conditions to earn a bonus pursuant to the Bonus Plan, you will
nevertheless receive the following:



5.    Severance Benefits.The Company will provide you with the following severance benefits:



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6.    Consulting Relationship.The Company agrees to retain you, and you agree to make yourself available to perform services,
as a consultant to the Company, under the terms specified below.



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7.Resignation Announcement.You and the Company will agree on the wording of
a jointly released public announcement concerning your resignation that will be released during the week of November 26, 2001, and the Company agrees to respond to any inquiries regarding your
resignation in a manner consistent with such public announcement.

8.Proprietary Information Obligations.You acknowledge your continuing
obligations under your Intrabiotics' Employment, Confidential Information and Invention Assignment Agreement, a copy of which is attached hereto as Exhibit D.

9.Other Compensation or Benefits.You acknowledge that, except as expressly
provided in this Agreement, you will not receive any additional compensation, bonus, severance, stock vesting or benefits after the Separation Date.

10.Expense Reimbursements.You agree to submit to the Company within five
(5) business days of the Separation Date your final documented expense reimbursement statement reflecting all business

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expenses you incurred through the Separation Date, if any, for which you seek reimbursement. The Company will reimburse you for such business expenses pursuant to its regular business practice.

11.Return of Company Property.By the Separation Date, you agree to return
to the Company all Company documents (and all copies thereof) and other Company property that you had in your possession at any time, including, but not limited to, Company files, notes, drawings,
records, business plans and forecasts, financial information, specifications, computer-recorded information (including, but not limited to, email and files on your computer hard drive), tangible
property, credit cards, telephone calling cards, entry cards, identification badges and keys, and, any materials of any kind that contain or embody any proprietary or confidential information of the
Company (and all reproductions thereof). As part of this Agreement, the Company will give you, "as is" and without warranty or guarantee of any kind, the desktop computer, laptop computer, and
computer printer that you were allowed to use during your employment. On or before the Separation Date, you will deliver the desktop computer, laptop computer, and computer printer to the Company, so
that the Company may identify, remove and/or delete any Company property located or stored therein.

12.No Admissions.Nothing contained in this Agreement shall be construed as
an admission by you or by the Company of any liability, obligation, wrongdoing or violation of law.

13.Confidentiality.The provisions of this Agreement will be held in
strictest confidence by you and the Company and will not be publicized or disclosed in any manner whatsoever;provided, however,that: (a) you
may disclose this Agreement in confidence to your immediate family; (b) the parties may disclose this Agreement in confidence to their respective attorneys, accountants, auditors, tax
preparers, and
financial advisors; (c) the Company may disclose this Agreement as necessary to fulfill standard or legally required corporate reporting or disclosure requirements; and (d) the parties
may disclose this Agreement insofar as such disclosure may be necessary to enforce its terms or as otherwise required by law. In particular, and without limitation, you agree not to disclose the terms
of this Agreement to any current or former Company employee or contractor.

14.Nondisparagement.Both you and the Company agree not to disparage the
other party, and the other party's officers, directors, employees, shareholders and agents, in any manner likely to be harmful to them or their business, business reputation or personal reputation;
provided that both you and the Company will respond accurately and fully to any question, inquiry or request for information when required by legal process.

15.Kelley's Release of Claims.In exchange for the consideration under this
Agreement to which you would not otherwise be entitled and as required by the Severance Plan, you hereby generally and completely release the Company and its directors, officers, employees,
shareholders, partners, agents, attorneys, predecessors, successors, parent and subsidiary entities, insurers, affiliates, and assigns from any and all claims, liabilities and obligations, both known
and unknown, that arise out of or are in any way related to events, acts, conduct, or omissions occurring at any time prior to and including the date you sign this Agreement. This general release
includes, but is not limited to: (1) all claims arising out of or in any way related to your employment with the Company or the termination of that employment; (2) all claims related to
your compensation or benefits from the Company, including salary, bonuses, commissions, vacation pay, expense reimbursements, severance pay, fringe benefits, stock, stock options, or any other
ownership interests in the Company, including but not limited to claims under the Severance Plan or the Bonus Plan; (3) all claims for breach of contract, wrongful termination, and breach of
the implied covenant of good faith and fair dealing; (4) all tort claims, including claims for fraud, defamation, emotional distress, and discharge in violation of public policy; and
(5) all federal, state, and local statutory claims, including claims for discrimination, harassment, retaliation, attorneys' fees, or other claims arising under the federal Civil Rights Act of
1964 (as amended), the federal Americans with Disabilities Act of 1990, the federal Age Discrimination in Employment Act of 1967 (as amended) (the "ADEA"), and the California Fair Employment and
Housing Act (as amended).

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16.ADEA Waiver.You acknowledge that you are knowingly and voluntarily
waiving and releasing any rights you may have under the ADEA, and that the consideration given for the waiver and release in the preceding paragraph hereof is in addition to anything of value to which
you were already entitled. You further acknowledge that you have been advised by this writing, as required by the ADEA, that: (a) your waiver and release do not apply to any rights or claims
that may arise after the date you sign this Agreement; (b) you have the right to consult with an attorney prior to executing this Agreement; (c) you have twenty-one
(21) days to consider this Agreement (although you may choose to voluntarily execute this Agreement earlier); (d) you have seven (7) days following the execution of this Agreement
by the parties to revoke the Agreement; and (e) this Agreement will not be effective until the date upon which the revocation period has expired, which will be the eighth day after this
Agreement is executed by you, provided that the Company has also executed this Agreement by that date (the "Effective Date").

17.Company's Release of Claims.The Company hereby releases, acquits and
forever discharges you from any and all claims, liabilities, demands, causes of action, costs, expenses, attorneys fees, damages, indemnities, and obligations of every kind and nature, in law, equity,
or otherwise, known and unknown, suspected and unsuspected, disclosed and undisclosed arising out of or in any way related to agreements, events, acts or conduct at any time prior to and including the
date the Company executes this Agreement, with the exception of any claim arising out of your obligations under this Agreement, your Employment, Confidential Information and Invention Assignment
Agreement, your proprietary information obligations, criminal misconduct, or fraud. You will continue to be covered by the Company's Directors & Officers liability insurance policy consistent
with its terms.

18.Section 1542 Waiver.In granting the releases herein, the parties
understand that this Agreement includes a release of all claims known or unknown. In giving these releases, which includes claims which may be unknown at present, the parties acknowledge that they
have read and understand Section 1542 of the California Civil Code which reads as follows:



You
and the Company hereby expressly waive and relinquish all rights and benefits under that section and any law of any jurisdiction of similar effect with respect to their releases of any unknown or
unsuspected claims they may have.

19.Miscellaneous.This Agreement, including Exhibits C and D, constitutes
the complete, final and exclusive embodiment of the entire agreement between you and the Company with regard to this subject matter. It is entered into without reliance on any promise or
representation, written or oral, other than those expressly contained herein, and it supersedes any other such promises, warranties or representations. This Agreement may not be modified or amended
except in a writing signed by both you and a duly authorized officer of the Company. This Agreement will bind the heirs, personal representatives, successors and assigns of both you and the Company,
and inure to the benefit of both you and the Company, their heirs, successors and assigns. You shall not assign, transfer or subcontract this Agreement or any of your obligations hereunder without the
Company's express prior written permission. If any provision of this Agreement is determined to be invalid or unenforceable, in whole or in part, this determination will not affect any other provision
of this Agreement and the provision in question will be modified by the court so as to be rendered enforceable. This Agreement will be deemed to have been entered into and will be construed and
enforced in accordance with the laws of the State of California as applied to contracts made and to be performed entirely within California.

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Please
sign below to indicate your agreement to these terms and conditions, and return the Agreement to me.

|Sincerely,                        
|----------------------------------
|INTRABIOTICS PHARMACEUTICALS, INC.
|                                  
|By:                               

Enclosures:
Exhibit ASenior Executive Severance Plan
Exhibit B2001 Officer Incentive Bonus Plan
Exhibit CResignation of Board Membership Letter
Exhibit DIntrabiotics' Employment, Confidential Information and Invention Assignment Agreement

|I UNDERSTAND AND AGREE TO THE TERMS SET FORTH ABOVE:
|----------------------------------------------------
|/s/ Kenneth J. KelleyKen Kelley                     
|Date:                                               

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EXHIBIT A    SENIOR EXECUTIVE SEVERANCE BENEFIT PLAN

[This
document was previously filed as Exhibit 10.26 to the Company's Form 10-Q filed with the Securities and Exchange Commission on August 14, 2001.]

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EXHIBIT B    2001 OFFICER INCENTIVE BONUS PLAN

[This
document was previously filed as Exhibit 10.28 to the Company's Form 10-Q filed with the Securities and Exchange Commission on August 14, 2001.]

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EXHIBIT C    LETTER OF RESIGNATION

November 29,
2001

Kathy
LaPorte
Acting Chairman of the Board of Directors

Dear
Kathy:

For
the reasons we have discussed, effective November 29, 2001, I hereby resign as a member of the Board of Directors of Intrabiotics Pharmaceuticals, Inc. (the "Company").

I
have enjoyed my working relationship with you and the Board and I look forward to continuing to be of service to the Company in a consulting capacity.

| |  | Sincerely,           
| |  | ---------------------
| |  | /s/ Kenneth J. Kelley
| |  | Ken Kelley           

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EXHIBIT D    INTRABIOTICS' EMPLOYMENT, CONFIDENTIAL INFORMATION AND  INVENTION ASSIGNMENT AGREEMENT

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|[ COMPANY LOGO ] |  |  |  | Employee: Kenneth Kelley
|---------------- |  |  |  | ------------------------

INTRABIOTICS' EMPLOYMENT, CONFIDENTIAL INFORMATION AND  INVENTION ASSIGNMENT AGREEMENT

As
a condition of my employment with IntraBiotics Pharmaceuticals, Inc. ("IntraBiotics"), and in consideration of my employment with IntraBiotics and my receipt of the compensation now
and hereafter paid to me by IntraBiotics, I agree to the following:

1.Confidential Information.

(a)IntraBiotics and Third Party Information.I agree at all times during the term of my employment and
thereafter, to hold in strictest confidence, and not to use, except for the benefit of IntraBiotics, or to disclose to any person, firm or corporation without written authorization of an officer of
IntraBiotics, any Confidential Information of IntraBiotics. I understand that "Confidential Information" means any IntraBiotics proprietary information, technical data, trade secrets or know-how,
including, but not limited to, research and product plans, products, services, customer lists and customers, markets, developments, inventions, processes, formulas, technology, marketing, finances or
other business information disclosed to me by IntraBiotics either directly or indirectly, in writing, orally or otherwise. I recognize that IntraBiotics has received and in the future will receive
from third parties their confidential or proprietary information subject to a duty on IntraBiotics' part to maintain the confidentiality of such information and to use it only for certain limited
purposes, and I understand that such information is also Confidential Information. I further understand that Confidential Information does not include any of the foregoing items that has become
publicly known and made generally available through no wrongful act of mine or of others who were under confidentiality obligations as to the item or items involved.

(b)Former Employer Information.I agree that I will not, during my employment with
IntraBiotics, improperly use or disclose any proprietary information or trade secrets of any former or concurrent employer or other person or entity and that I will not bring onto the premises of
IntraBiotics any unpublished document or proprietary information belonging to any such employer, person or entity unless consented to in writing by such employer, person or entity.

2.Inventions.

(a)Inventions Retained and Licensed.I have attached hereto, as Exhibit A, a list describing all
inventions, original works of authorship, developments, improvements, and trade secrets that were made by me prior to my employment with IntraBiotics (collectively referred to as "Prior Inventions"),
that belong to me, that relate to IntraBiotics' proposed business, products or research and development, and that are not assigned to IntraBiotics hereunder; or, if no such list is attached, I
represent that there are no such Prior Inventions. If in the course of my employment with IntraBiotics, I incorporate into an IntraBiotics product, process or machine a Prior Invention owned by me or
in which I have an interest, IntraBiotics is hereby granted and will have a nonexclusive, royalty free, irrevocable, perpetual, worldwide license, with the right to grant sublicenses, to make, have
made, modify, use and sell such Prior Invention as part of or in connection with such product, process or machine.

(b)Assignment of Inventories.I agree that I will promptly make full written disclosure to IntraBiotics, and
will hold in trust for the sole right and benefit of IntraBiotics, and hereby assign to IntraBiotics, or
its designee, all my right, title, and interest in and to any and all inventions, original works or authorship, developments, concepts, improvements or trade secrets, whether or not patentable or
registrable under patent, copyright or similar laws, that I may solely or jointly conceive or develop or

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reduce to practice, or cause to be conceived or developed or reduced to practice, during the period of time I am in the employ of IntraBiotics (collectively referred to as "Inventions"). I further
acknowledge that all original works of authorship that are made by me (solely or jointly with others) within the scope of and during the period of my employment with IntraBiotics and that are
protectable by copyright are "works made for hire," as that term in defined in the United States Copyright Act.

(c)Maintenance of Records.I agree to keep and maintain adequate and current written
records of all Inventions made by me (solely or jointly with others) during the term of my employment with IntraBiotics. The records will be in the form of notes, sketches, drawings, and any other
format that may be specified by IntraBiotics. The records will be available to and remain the sole property of IntraBiotics at all times.

(d)Patent and Copyright Registrations.I agree to assist IntraBiotics, or its designee,
at IntraBiotics' expense, in every way to secure copyrights, patents, mask work rights or other intellectual property rights relating thereto in any and all countries, including disclosing to
IntraBiotics all pertinent information and data with respect thereto, and executing all applications, specifications, oaths, assignments and all other instruments that IntraBiotics shall deem
necessary in order to apply for and obtain such rights and in order to assign and convey to IntraBiotics, its successors, assigns and nominees the sole and exclusive rights, title and interest in and
to such Inventions, and any copyrights, patents, mask work rights or other intellectual property rights relating thereto. I further agree that my obligation to execute or cause to be executed, when it
is in my power to do so, any such instrument or papers will continue after the termination of this Agreement. If incapacity or for any other reason to secure my signature to apply for or to pursue any
application for any United States or foreign patents or copyright registrations covering Inventions or original works of authorship assigned to IntraBiotics as above, then I hereby irrevocably
designate and appoint IntraBiotics and its duly authorized officers and agents as my agent and attorney in fact, to act for and in my behalf and stead to execute and file any such applications and to
do all other lawfully permitted acts to further the prosecution and issuance of letters patent or copyright registrations thereon with the same legal force and effect as if executed by me.

3.Employment.

(a)Eligibility.I understand that as an employer in the United States, IntraBiotics is required to certify that
all of its employees are eligible to work in this country. Within the first three days of employment, I will present personal identification and employment eligibility documentation to IntraBiotics.

(b)Conflicting Employment.I agree that, during the term of my employment with IntraBiotics, I will not engage
in any other employment, occupation, consulting or other business activity directly related to the business in which IntraBiotics is now involved or becomes involved during the term of my employment,
nor will I engage in any other activities that conflict with my obligations to IntraBiotics.

(c)At-Will Employment.I understand and acknowledge that my employment with IntraBiotics is for an unspecified
duration and constitutes "at-will" employment. I acknowledge that this employment relationship may be terminated at any time, with or without cause, at the option of either IntraBiotics or myself,
with or without notice. In the event of resignation, IntraBiotics requests two weeks notice.

4.Returning IntraBiotics' Documents.I agree that, at the time of leaving the employ of IntraBiotics,
I will deliver to IntraBiotics (and will not keep in my possession, recreate or deliver to anyone else) any and all documents or property, or reproductions of any such documents or property, developed
by me pursuant to my employment with IntraBiotics or otherwise belonging to IntraBiotics, its successors or assigns.

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5.Solicitation of Employees.I agree that for a period of twelve (12) months immediately following
the termination of my relationship with IntraBiotics for any reason, whether with or without cause, I will not either directly or indirectly solicit, induce, recruit or encourage any of IntraBiotics'
employees to leave their employment, or take away such employees, or attempt to solicit, induce, recruit, encourage or take away employees of the IntraBiotics, either for myself or for any other
person or entity.

6.Representations.I agree to execute any proper oath or verify any proper document requested by
IntraBiotics to carry out the terms of this Agreement. I represent that my performance of all the terms of this Agreement will not breach any agreement to keep in confidence proprietary information
acquired by me in confidence or in trust prior to my employment by IntraBiotics. I have not entered into, and I agree I will not enter into, any oral or written agreement in conflict with the terms of
this Agreement.

7.Arbitration and Equitable Relief.

(a)Arbitration.    Except as provided in Section (b) below, I agree that any dispute or
controversy arising out of or relating to any interpretation, construction, performance or breach of this Agreement, will be settled by arbitration to be held in San Francisco, California, in
accordance with the rules then in effect
of the American Arbitration Association. The arbitrator may grant injunctions or other relief in such dispute or controversy. The decision of the arbitrator will be final, conclusive and binding on
the parties to the arbitration. Judgment may be entered on the arbitrator's decision in any court having jurisdiction. IntraBiotics and I will each pay one-half of the costs and expenses of such
arbitration, and each of us will separately pay our counsel fees and expenses.

(b)Equitable Remedies.I agree that it would be impossible or inadequate to measure and
calculate IntraBiotics' damages from any breach of the covenants set forth in Section 1, 2, and 5 herein. Accordingly, I agree that if I breach my obligations under any of such Sections, IntraBiotics
will have in addition to any other right or remedy available, the right to obtain an injunction from a court of competent jurisdiction restraining such breach or threatened breach and to specific
performance of any such provision of this Agreement. I further agree that no bond or other security will be required in obtaining such equitable relief and I hereby consent to the issuance of such
injunction and to the ordering of specific performance. I hereby further consent to the personal jurisdiction of the state and federal courts in California for any lawsuit filed there against me by
IntraBiotics arising from or relating to this Agreement.

8.General Provisions.

(a)Governing Law.This Agreement will be governed by the laws of the state of
California without reference to conflicts of laws principles.

(b)Entire Agreement.This Agreement sets forth the entire agreement and understanding
between IntraBiotics and me relating to the subject matter hereofexcept for the Letter Agreement dated, executed and ratified by the Board of Directors on November 14,
1995. The terms of Letter Agreement (such as term of employment) shall dominate terms of this Agreement for the period of time when such conflicts may arise.No modification of
or amendment to this Agreement, or any waiver of any rights under this Agreement, will be effective unless in writing signed by the party to be charged. Any subsequent change or changes in my duties,
salary or compensation will not affect the validity or scope of this Agreement.

(c)Severability.If one or more of the provisions in this Agreement are deemed void by law, then the remaining
provisions will continue in full force and effect.

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(d)Successors and Assigns.This Agreement will be binding upon my heirs, executors, administrators and other
legal representatives and will be for the benefit of IntraBiotics, its successors, and its assigns.

|Date:                                                   | March 21, 1995 |  | /s/KENNETH J. KELLEYSignature              
|------------------------------------------------------- | -------------- |  | -------------------------------------------
|                                                        |                |  | Kenneth J. KelleyName of Employee (printed)
|                                                        |                |  | 1331 Hillview DriveStreet                  
|                                                        |                |  | Menlo Park, CA 94025City, State, Zip Code  
|                                                        |                |  | Social Security Number                     
|/s/ MP BakerSignature                                   |                | 
|Michael P. BakerName of IntraBiotics' Officer (printed) |                | 
|CFOTitle                                                |                | 

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|[COMPANY LOGO] |  | Employee: Kenneth Kelley
|-------------- |  | ------------------------

EXHIBIT A    LIST OF PRIOR INVENTIONS    AND ORIGINAL WORKS OF AUTHORSHIP

|Title |  | Date |  | Identifying Number
or Brief Description
|----- |  | ---- |  | ---------------------------------------
|      |  |      |  |                                        
|      |  |      |  |                                        

0
No inventions or improvements

Additional Sheets Attached

Signature
of Employee: /s/ KENNETH J. KELLEY

Print
Name of Employee: Kenneth J. Kelley

Date:
March 21, 1995

Print
Name of Employee's Supervisor at N/A

Print
Name of supervisor:

Date:

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