FORM 10-Q/A

                         AMENDMENT NO. 1

               SECURITIES AND EXCHANGE COMMISSION
                      Washington, DC  20549

     QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
                 SECURITIES EXCHANGE ACT OF 1934

          For the quarterly period ended June 30, 1998

                 Commission File Number 0-23666


                          TRIPOS, INC.
     (Exact Name of Registrant as Specified in its Charter)

               Utah                          43-1454986
     (State or Other Jurisdiction of         (I.R.S. Employer
     Incorporation or Organization)          Identification No.)

                     1699 South Hanley Road
                   St. Louis, Missouri  63144
      (Address of Principal Executive Offices and Zip Code)


                         (314) 647-1099
      (Registrant's Telephone Number, Including Area Code)


Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirement for the past 90 days.

Yes  X         No

Number of shares outstanding of the issuer's Common Stock, par
value $.01 per share, as of June 30, 1998:  3,214,401 shares.





Tripos files this Amendment No.1 on Form 10-Q/A to its Form 10-Q
for the quarter ended June 30, 1998:


     *    to replace Item 6 in its entirety:

     *    to add an Exhibit Index,

     *    to indicate in the Exhibit Index that portions of Exhibit
       10.13 have been omitted pursuant to a confidential treatment
       request filed by Tripos with Securities and Exchange Commission;
       and

     *    to refile Exhibit 10.13 to insert disclosure on each
       applicable page that information omitted on that page has been
       omitted pursuant to a request for confidential treatment and that
       the omitted portion has been separately filed with the Securities
       and Exchange Commission.

Item 6    Exhibits and Reports on Form 8-K


     (a)  See the Exhibit Index attached hereto and incorporated
          herein by this reference

     (b)  No reports on Form 8-K were required to be filed during the
          period from April 1, 1998 through June 30, 1998.


                           SIGNATURES

     Pursuant to the requirements of the Securities Act of 1934,
the Registrant has duly caused this Amendment No. 1 of its report
to be signed on its behalf by the undersigned hereunto duly authorized.

                           TRIPOS,INC.

Date:   May 26, 2000       /s/ John P. McAlister
                          John P. McAlister
                          President and Chief Executive Officer

Date:   May 26, 2000      /s/ Colleen A. Martin
                          Colleen A. Martin
                          Chief Financial Officer, Secretary



                          EXHIBIT INDEX


     The exhibits below are numbered in accordance with the
Exhibit Table of Item 601 of Regulation S-X.

     Exhibit
     Number    Exhibit
     2         Omitted - Inapplicable
     3(i)      Omitted - Inapplicable
     3-(ii)    Omitted - Inapplicable
     4         Omitted - Inapplicable
     *10.13    Settlement Agreement by and among Tripos, Inc.
               Panlabs Incorporated and for the purposes of
               Section 6 thereof only, MDS, Inc., dated as of
               March 30, 1998
     11        Omitted - Inapplicable
     15        Omitted - Inapplicable
     18        Omitted - Inapplicable
     19        Omitted - Inapplicable
     22        Omitted - Inapplicable
     23        Omitted - Inapplicable
     24        Omitted - Inapplicable
     27        Financial Data Schedule (filed electronically with
                the SEC only)
     99        Omitted - Inapplicable
    ________
*     Portions of this Exhibit have been omitted pursuant to a
request for Confidential Treatment filed separately with the
Secretary of the Securities and Exchange Commission.


Exhibit 10.13

*  The information marked by "X" and "[]" has been omitted
pursuant to a request for confidential treatment.  The omitted
portion has been separately filed with the Commission.


                      SETTLEMENT AGREEMENT

     THIS  SETTLEMENT AGREEMENT ("Agreement") is made as of March
30,  1998,  (the  "Effective Date") by and  between  (i)  PANLABS
INCORPORATED,  a Washington corporation with its principal  place
of   business  at  11804  North  Creek  Parkway  South,  Bothell,
Washington 98011-8805 ("Panlabs"), and (ii) TRIPOS, INC., a  Utah
corporation  with its principal place of business at  1699  South
Hanley  Road,  Suite 303, St. Louis, Missouri  63144  ("Tripos"),
who, intending to be legally bound, hereby agree as follows:

1.   INTRODUCTION
     1.1      The  parties  entered into that  certain  Strategic
Alliance   Business   Teaming   Agreement,   including    Project
Description  #1  thereunder, dated June 30,  1995  (the  "Teaming
Agreement").
     1.2    Certain controversies have arisen between the parties
concerning  their  respective rights and  obligations  under  the
Teaming Agreement.
    1.3  The parties  now  wish  to resolve  the controversies
Between them in accordance  with  the  terms of  this  Settlement
Agreement.

2.   TEAMING AGREEMENT TERMINATION
   2.1  Effect of Termination.  The parties acknowledge and agree
that the Teaming Agreement has been terminated in its entirety as
of  the  Effective Date hereof.  The parties further  acknowledge
and agree that, notwithstanding the provisions of Section 8.1  of
the  Teaming  Agreement, no provision of the  Teaming  Agreement,
including without limitation any provision of Project Description
#1,  shall  survive such termination.  All rights and obligations
of  the  parties  to one another in connection with  the  Teaming
Agreement shall be exclusively as set forth in this Agreement.
     2.2  Settlement of Customer Claims. Each party("Indemnitor")
will  indemnify  the  other  party  ("Indemnitee")  and  hold  it
harmless  from  and  against  all  claims,  damages,  losses  and
expenses, including court costs and reasonable fees and  expenses
of  attorneys, expert witnesses and other professionals,  arising
out  of  or  resulting  from, and will  defend  the  other  party
against:
     (a)   any action by a third party that is based on any claim
that  any  services  performed by the  Indemnitor  or  under  the
Teaming Agreement, or their results, infringe a patent, copyright
or  other  proprietary right or violate a trade  secret  of  such
third  party; provided, however, that for purposes  of  a  patent
infringement claim, unless such claim rests definitely and solely
on  the  technology of, or the services performed by, one of  the
parties  or  the  party  who owned any infringing  technology  or
performed  any  infringing  services  knew  that  the  same   was
infringing at the time of use or performance, the Indemnitor  and
the  Indemnitee shall be jointly responsible for the  defense  of
the claim and shall bear all resulting liability in proportion to
the respective revenues realized by them from the transaction  in
connection with which the claim arose; and
     (b)  any action by a third party that is based on
          (i)any  unauthorized warranty given by  the  Indemnitor
             for  services performed under the Teaming Agreement,
             or
          (ii)     the  results of any services performed by  the
             Indemnitor  under  the Teaming Agreement,  including
             any   action   based  on  a  claim  that   Optiverse
             materials fail to meet quality requirements, or
          (iii)    any  failure  by  the  Indemnitor  to  provide
             services  under  the  Teaming  Agreement,   or   the
             results  of  such  services, in  accordance  with  a
             contract entered into between the Indemnitor  and/or
             the Indemnitee and such third party.
The indemnification obligations set forth in this Section 2.2 are
conditioned  on  (i)  the Indemnitor being notified  promptly  in
writing  of any indemnifiable claim and all prior claims relating
to such action and being given all available relevant information
and   reasonable  assistance  in  connection  with  defense   and
settlement  efforts, and (ii) the Indemnitor having sole  control
of  the defense and settlement efforts for such claim, other than
for patent matters as set forth in Section 2.2(a).
     2.3   Final  Accounting.  The parties acknowledge that  they
are  in  agreement  regarding (a) the  number  of  shipments  and
quantity of Optiverse Materials shipped between November 1,  1997
and   the   Effective  Date,  (b)  the  allocation  of   revenues
attributable to the Optiverse Materials which have been collected
between  November  1,  1997  and the Effective  Date,  (c)  other
accounting  issues,  and  (d) existing  inventories,  as  of  the
Effective Date, of Optiverse Materials and raw materials obtained
for  purposes  of synthesizing Optiverse Materials.   A  detailed
listing  of all items and calculation of the net credit to  which
the parties agree pursuant to this Section 2.3 is attached hereto
as Schedule A.

3.   OWNERSHIP RIGHTS in VENTURE PROPERTY
     3.1   Joint  Ownership.  The following property  created  by
either  party  individually,  or  by  the  parties  jointly,   in
performance  of  the  parties'  obligations  under  the   Teaming
Agreement (the "Venture Property") shall be jointly owned by  the
parties until Tripos has realized the Agreed Amount in accordance
with Article 5 below, and until such time, the payment and credit
obligations set forth in said Article 5 shall apply in connection
with any sale or other disposition of any Venture Property:
     (a)   all  diverse library compound designs which have  been
synthesized and identified by Panlabs, whether in the  possession
of Tripos or Panlabs;
     (b)   all existing inventory of Optiverse Materials, whether
in the possession of Tripos or Panlabs;
     (c)  the Optiverse library database; and
     (d)  all biological data that was developed for purposes  of
marketing  Optiverse Materials, the expenses for  development  of
which   were   reimbursed  out  of  revenues  from   transactions
concerning Optiverse Materials.
     3.2   Transfer to Panlabs.  On the date on which Tripos  has
realized  the  Agreed Amount, Tripos shall transfer  all  of  its
rights,   title  and  interest  in  any  then-remaining   Venture
Property, and shall execute any documents reasonably requested by
Panlabs  to  evidence such transfer.  After  such  date,  Panlabs
shall  have  the exclusive right to sell the Optiverse  Materials
worldwide without further royalty obligation to Tripos.
     3.3  Conditional Tripos Marketing Rights.  In the event that
Panlabs reports no revenues from Optiverse Materials during,  and
makes  no  payment to Tripos in accordance with Section 5.3  for,
any two consecutive calendar quarters prior to the expiration  of
Phase  2  as  identified  in  Section  4.2  below,  Tripos  shall
thereupon  have  the  exclusive right  to  market  the  remaining
Optiverse   Materials  worldwide  and  shall  credit  twenty-five
percent  (25%)  of  all  revenues received  therefrom  by  Tripos
against the Agreed Amount in accordance with Section 5.4.
     3.4   The OPTIVERSE Trademark.  During Phase 1 as identified
in  Section  4.1 below, each party shall be entitled to  use  the
OPTIVERSE trademark solely in connection with, and solely for the
purpose  of,  identifying and marketing the Optiverse  Materials.
Upon  the expiration of Phase 1, Tripos shall transfer and assign
to  Panlabs  (via written assignment upon Panlabs "request")  all
right,  title and interest in and to the OPTIVERSE trademark  and
associated goodwill, after which assignment Tripos shall have  no
further right to use the OPTIVERSE trademark in any form,  except
as   allowed  under  this  Section.   Said  assignment  shall  be
predicated  upon  Panlabs' agreement that it  shall  not  use  or
attempt to register the OPTIVERSE mark for any purpose or product
other  than  the  identification and marketing of  the  OPTIVERSE
Materials,  as  defined in this Agreement.  Following  assignment
from  Tripos, Panlabs shall have the right to pursue registration
and  enforcement  of  the mark in connection with  the  OPTIVERSE
Materials,  and  Tripos shall cooperate in the execution  of  any
documents   necessary   to   enable  Panlabs   to   pursue   such
registration.  Panlabs shall also have the right to  license  the
use  and/or  transfer  ownership of the mark  to  third  parties,
provided  that such third-party licensees shall be bound  by  the
same  restrictions of use of the mark as bind Panlabs under  this
Section.  In the event that the exclusive marketing rights to the
OPTIVERSE  Materials  shall  revert to  Tripos  by  operation  of
Section  3.3  of  this Agreement, Panlabs shall  assign  back  to
Tripos  all  right, title and interest in and  to  the  mark  and
associated goodwill, including any trademark filings initiated by
Panlabs.

4.   DISPOSITION OF OPTIVERSE MATERIALS
     The Optiverse Materials shall be disposed of in three phases
as follows:
     4.1   Phase 1.  During the period beginning on the Effective
Date  and expiring on June 30, 1998, which period shall be  known
as  "Phase  1",  each  party may market the  Optiverse  Materials
worldwide,  subject  to  the payment and credit  obligations  set
forth in Sections 5.3 and 5.4.
     4.2   Phase 2.  During the period beginning on July 1,  1998
and  expiring on the date on which Tripos has realized the Agreed
Amount in accordance with Article 5 below, which period shall  be
known  as  "Phase  2",  Panlabs shall have  the  exclusive  right
(except  as  otherwise provided in Section  3.3  and  as  may  be
mutually   agreed  by  the  parties  in  connection  with   their
cooperative  pursuit of any joint research contracts)  to  market
the   Optiverse  Materials  worldwide,  subject  to  the  payment
obligations  set  forth in Article 5.  The terms and  conditions,
including  revenue  allocations,  which  are  applicable  to  any
mutually agreed upon joint research contracts shall be separately
specified in writing for each such contract.
     4.3   Phase  3.   During the period after  the  transfer  by
Tripos to Panlabs of all of Tripos' rights, title and interest in
any  then-remaining Optiverse Materials, Panlabs shall  have  the
exclusive  right to market the Optiverse Materials worldwide  and
Tripos  shall  have no rights hereunder to market  any  Optiverse
Materials.
     4.4.       Use  by the Parties.  Prior to Phase  3,  neither
party  shall use any Optiverse Materials without paying its share
of  the  standard  charge,  except that  Panlabs  may  transport,
process,  repackage  and otherwise prepare or  enhance  OPTIVERSE
Materials  for third-party sale.  In addition, Panlabs  shall  be
permitted  to  utilize  jointly owned  diverse  library  compound
designs   without   charge  for  the  purpose  of   manufacturing
additional  quantities  of  OPTIVERSE  Materials  as  needed  for
product  line  maintenance.  For use of  Optiverse  Materials  by
Tripos,  payment of its share of the standard charge  shall  mean
crediting  to  Panlabs in accordance with Section 5.4  an  amount
equal  to  the amount which would have been credited  to  Panlabs
thereunder if Tripos had marketed the same Optiverse Materials to
a  third  party.   For  use of Optiverse  Materials  by  Panlabs,
payment of its share of the standard charge shall mean payment to
Tripos  in accordance with Section 5.4 of an amount equal to  the
amount  which  would  have been payable to Tripos  thereunder  if
Panlabs had marketed the Optiverse Materials to a third party.


*  The information marked by "X" and "[]" has been omitted
pursuant to a request for confidential treatment.  The omitted
portion has been separately filed with the Securities and
Exchange Commission.


5.   PAYMENTS AND CREDITS
     Regardless  of any amounts paid pursuant to Section  2.3  of
this  Agreement, Panlabs hereby agrees to pay Tripos up to [XXXX]
Dollars ($[XXXX]) ([XXXX] Dollars being the "Agreed  Amount"  for
purposes of this Agreement) as consideration for Tripos' transfer
to  Panlabs,  in accordance with Section 3.2, of all  of  Tripos'
rights,  title and interest in any remaining Venture Property  as
of the expiration of Phase 2, as follows:
     5.1   Initial  Payment.  Upon execution of  this  Agreement,
Panlabs shall authorize the release to Tripos of all funds in the
escrow account established by Tripos to receive and hold Panlabs'
share  of  the  proceeds  derived from  marketing  the  Optiverse
Materials  to [XXXX]  and the  [XXXX] and shall  take  all  steps
which may be necessary to enable Tripos to receive such funds and
shall further authorize Tripos to retain all  such proceeds which
Tripos  may  subsequently  collect.  Such  funds  shall  be  non-
refundable  by  Tripos,  and Tripos  shall  credit [XXXX] Dollars
($[XXXX]), as and to the extent  that Tripos  collects applicable
proceeds, against the Agreed Amount.
     5.2   Subsequent Lump-Sum Payments.  Panlabs shall remit  to
Tripos an aggregate amount of [XXXX] Dollars ($[XXXX]) in six (6)
equal  installments  of  [XXXX] Dollars  ($[XXXX]) on each of the
following dates: June 30, 1998, September 30, 1998, December  31,
1998, March 31, 1999, June 30, 1999 and September 30, 1999.  Such
payments  shall  be non-refundable by Tripos, and  upon  receipt,
Tripos  shall  credit  one hundred percent (100%)  of  each  such
payment against the Agreed Amount.  Any payment which is past due
shall  bear  interest  at a rate of eighteen  percent  (18%)  per
annum.
     5.3   Payments  Due  on  Transactions  Concerning  Optiverse
Materials.   Panlabs shall pay Tripos [XXXX] percent ([XXXX]%) of
Total Revenues  received  by  Panlabs  from  marketing  Optiverse
Materials during Phase 1 and Phase 2.  Not later than twenty-five
(25) days after  the end of  each calendar quarter, Panlabs shall
submit  to Tripos  a  written report  of all Panlabs transactions
concerning Optiverse  Materials during the such quarter and Total
Revenues received  by  Panlabs therefrom and shall remit payments
due in accordance with  this  Section 5.3.   Tripos  shall credit
one hundred percent  (100%) of  such payments  against the Agreed
Amount.
     5.4   Credits  for Transactions Initiated  by  Tripos.   Not
later than twenty-five (25) days after the end of Phase 1, Tripos
shall submit to Panlabs a written report of  all Tripos transact-
ions concerning Optiverse Materials  during such calendar quarter
and all revenues received  by  Tripos therefrom.  [XXXX]  percent
([XXXX]%) of  the  revenues identified  in each  report shall  be
credited against the Agreed Amount as of the date of such report.

*  The information marked by "X" and "[]" has been omitted
pursuant to a request for confidential treatment.  The omitted
portion has been separately filed with the Securities and
Exchange Commission.)


     5.5   Buyout.   At  any time after Tripos has  received  all
proceeds  derived  from  marketing  the  Optiverse  Materials  to
(customer  name)   and    (customer name)    in  accordance  with
Section  5.1 and prior to December 31, 1999, Panlabs  shall  have
the  right to accelerate receipt of Phase 3 marketing rights  and
cause the transfer to Panlabs of all of Tripos' rights, title and
interest in the Optiverse Materials by making a lump-sum  payment
to  Tripos  equal  to  the  portion of  the  Agreed  Amount  then
remaining unpaid discounted by 8.5% compounded monthly.
     5.6   Total Revenues.  For purposes hereof, "Total Revenues"
shall  mean all amounts received from any source by Panlabs,  its
affiliates  or  assigns  for the sale,  transfer,  use  or  other
disposition of any Optiverse Materials.

6.   GUARANTEE
     6.1  MDS Guarantee.  In order to induce Tripos to enter into
this  Settlement  Agreement with Panlabs, MDS  Inc.,  a  Canadian
corporation with offices at 100 International Boulevard,  Toronto
M9W 6J6 CANADA ("MDS"), hereby assumes, subject to the limitation
set   forth  in  Section  6.2  below,  responsibility   for   and
guarantees, the timely payment by Panlabs of all amounts due  and
payable by Panlabs to Tripos in accordance with Sections 5.1, 5.2
and  5.3.   The  foregoing  payment obligations  of  Panlabs  are
hereinafter referred to as the "Guaranteed Obligations".  In  the
event   that   Panlabs  shall  fail  to  perform  any  Guaranteed
Obligation within the time such performance is due, Tripos  shall
promptly  notify  both  Panlabs and MDS  of  the  amount  of  the
Guaranteed  Obligation that is past due, and  MDS  shall,  within
three  (3)  business  days after receipt of  such  notice,  remit
payment  of such amount to Tripos.  Tripos shall not be required,
prior to any such notice to MDS, to pursue or exhaust any of  its
rights or remedies against Panlabs with respect to performance of
any  Guaranteed  Obligation  other than  providing  Panlabs  with
notice  of  default.   MDS  hereby  waives  presentment,  demand,
protest and notice of dishonor, nonpayment or other default  with
respect   to   any  Guaranteed  Obligations  and  promptness   in
commencing  suit against Panlabs and/or in giving notice  to,  or
making any demand hereunder on, MDS.  It is understood and agreed
that  this  Guarantee shall remain in effect notwithstanding  any
assignment  or  delegation by Panlabs of any of  its  obligations
under  the  Settlement  Agreement or any  change  in  control  of
Panlabs,  and  that none of the terms of this  Guarantee  may  be
waived, altered, modified or amended except in writing signed  by
Tripos and MDS.
   6.2  Ratification by MDS Board. Until such time that the terms
of  this  agreement have been ratified by the Board  of Directors
of  MDS, Inc., the total liability to  Tripos of  MDS under  this
article  shall  not  exceed [XXXX] ([XXXX]) Canadian Dollars.

*  The information marked by "X" and "[]" has been omitted
pursuant to a request for confidential treatment.  The omitted
portion has been separately filed with the Securities and
Exchange Commission.)

     6.3   Additional  Financial Assurance.  To  demonstrate  its
financial ability to discharge its obligations pursuant  to  this
Agreement,  Panlabs  shall,  not  later  than  April  17,   1998,
establish an irrevocable, confirmed letter of credit drawn  on  a
US   bank  reasonably  acceptable  to  Tripos  and  confirmed  by
NationsBank  of  St. Louis, in the amount of [XXXX] (US)  dollars
($[XXXX]), payable to Tripos upon presentment  of  this Agreement
and an affidavit by an officer of Tripos that the required
payment
has  not  been  made.   Continuation of  such  letter  of  credit
facility  shall not be required following receipt  by  Tripos  of
certification by MDS, Inc. that the terms of this Agreement  have
been  ratified by its Board of Directors and that the  limitation
provided in Section 6.2 is no longer in effect.

7.   OWNERSHIP OF INDIVIDUAL PROPERTY
     7.1   Tripos Property.  The following intellectual  property
which  Tripos used in connection with the performance of services
under  the  Teaming Agreement shall remain the sole  property  of
Tripos, and Panlabs hereby acknowledges that Panlabs has obtained
no  interest in or to any such property:  (a) the virtual library
databases,   (b)  library  design  methods,  Tripos   proprietary
software,  know-how  and Tripos proprietary computational  design
and  analysis  tools,  (c)  biological information  on  compounds
developed  or  obtained by Tripos, and (d) fifty percent  of  the
existing  inventory  of raw materials obtained  for  purposes  of
synthesizing Optiverse Materials.
     7.2   Panlabs Property.  The following intellectual property
which Panlabs used in connection with the performance of services
under  the  Teaming Agreement shall remain the sole  property  of
Panlabs,  and Tripos hereby acknowledges that Tripos has obtained
no interest in or to any such property:  (a) methods, systems and
know-how   for  the  synthesis  and  purification   of   chemical
libraries,  production  and  storage  facilities  and  biological
information on library compounds developed by Panlabs (b) library
design  methods,  Panlabs  proprietary  software,  know-how   and
Panlabs  proprietary  computational  design  and  analysis  tools
developed  or obtained by Panlabs independent of any  proprietary
information  furnished by Tripos, and (c) fifty  percent  of  the
existing  inventory  of raw materials obtained  for  purposes  of
synthesizing diverse Optiverse Materials.

8.   DELIVERIES
     In  the number of business days after the Effective Date  as
noted,  Panlabs shall ship to Tripos, at Panlabs' expense:    (a)
within  forty-five business days, fifty percent (50%) of the  raw
materials in Panlabs' possession on the Effective Date which were
obtained   for  purposes  of  synthesizing  Optiverse  Materials,
provided however that Panlabs shall provide the written  list  of
such  inventory  within fifteen (15) business  days;  (b)  within
twenty  (20) business days, all diverse library compound  designs
which have not been synthesized by Panlabs; and (c) within twenty
(20)   business  days,  the  SYBYL  software  and  related   data
management  software that is proprietary to Tripos, with  written
certification signed by an officer of Panlabs that all copies  of
such  software have been purged from Panlabs' computers and  that
Panlabs has retained no copies in any form.

9.   RECORDKEEPING AND AUDITS
     Each  party shall maintain complete and accurate records  of
all  transactions concerning Optiverse Materials which  occur  at
any  time  on or after the Effective Date and prior to a transfer
of  rights in the Optiverse Materials in accordance with  Section
3.2  or  Section  3.3.   Each party shall have  the  right,  upon
reasonable  prior  written notice, through an independent  public
accounting  firm  reasonably acceptable to the  other  party,  to
examine  and copy the books, records and accounts of  such  other
party   relating   to  transactions  concerning   the   Optiverse
Materials,  for  the  purposes of verifying  such  other  party's
compliance with the terms and conditions of this Agreement.   All
information regarding an audited party's business received in any
such  examination shall be held in confidence.  The  expenses  of
such  audits  shall  be  borne by the auditing  party;  provided,
however, that the audited party shall be charged for the  expense
of  any  such  audit  that discloses a discrepancy  in  favor  of
auditing  party  which is greater than or equal to  five  percent
(5%) of Total Revenues reported in accordance with Section 5.3 or
Section  5.4.   In  addition, if Panlabs is  the  audited  party,
Panlabs shall promptly remit to Tripos all amounts due in respect
of  the  discrepancy, and if Tripos is the audited party,  Tripos
shall  promptly credit against the Agreed Amount all amounts  due
in respect of the discrepancy.

10.  PUBLICITY
     Each  party  acknowledges that the terms of this  Settlement
Agreement  are considered confidential by the other party.   With
the   exception  of  disclosures  required  by  law  and  routine
announcements, neither party nor any of its affiliates shall make
any  announcements or disclosures regarding the other party,  the
Teaming Agreement or this Settlement Agreement without the  prior
written  consent  of the other party.  In no event  shall  either
party  make or publish any announcements of any kind which  might
tend to disparage the public image or corporate reputation of the
other party.

11.  MUTUAL RELEASES
     11.1 By Tripos.  Tripos, on its own behalf and on behalf  of
its   principals,   agents,   officers,   directors,   employees,
representatives, affiliates, successors, assigns  and  attorneys,
hereby   releases   and  forever  discharges  Panlabs   and   its
principals,     agents,    officers,    directors,     employees,
representatives,  affiliates, successors, assigns  and  attorneys
(the  "Panlabs  Released Parties") from any and all  liabilities,
claims,  demands,  rights, damages, debts,  responsibilities  and
actions  which Tripos had, has or hereafter may have against  the
Panlabs Released Parties arising out of or in connection with the
Teaming  Agreement; provided, however, that this provision  shall
not be read to release any claims which may hereafter be asserted
against  any  Panlabs Released Party which arise  out  of  or  in
connection with this Agreement.
     11.2  By Panlabs.  Panlabs, on its own behalf and on  behalf
of   its  principals,  agents,  officers,  directors,  employees,
representatives, affiliates, successors, assigns  and  attorneys,
hereby releases and forever discharges Tripos and its principals,
agents,    officers,   directors,   employees,   representatives,
affiliates,  successors,  assigns  and  attorneys  (the   "Tripos
Released Parties") from any and all liabilities, claims, demands,
rights,  damages,  debts,  responsibilities  and  actions   which
Panlabs  had,  has  or  hereafter may  have  against  the  Tripos
Released Parties arising out of or in connection with the Teaming
Agreement;  provided, however, that this provision shall  not  be
read  to  release  any  claims which may  hereafter  be  asserted
against  any  Tripos  Released Party which arise  out  of  or  in
connection with this Agreement.

12.  MISCELLANEOUS
     The validity, construction and performance of this Agreement
shall  be  governed  by  and construed  in  accordance  with  the
substantive  law  of the State of Washington, without  regard  to
conflicts  of law provisions.  If any provision of this Agreement
or  the  application of any such provision shall  be  held  by  a
tribunal  of  competent jurisdiction to be contrary to  law,  the
remaining provisions of this Agreement shall remain in full force
and effect to the maximum extent permissible.  This Agreement, as
executed  by the parties, constitutes the complete and  exclusive
understanding  and agreement of the parties with respect  to  the
subject matter hereof and supersedes all prior understandings and
agreements, whether written or oral, with respect to such subject
matter.

13.  COUNTERPARTS
     This  Agreement may be signed in any number of counterparts,
each  of which shall be deemed to be an original and all of which
shall be deemed to constitute one and the same Agreement.

IN  WITNESS WHEREOF, the parties have signed this Agreement as of
the Effective Date.
PANLABS INCORPORATED               TRIPOS, INC.

By:                                By:
Title:                             Title:

MDS INC. (solely for purposes of Section 6)

By:
Title: