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                                                                    EXHIBIT 10.2
                              DRUGSTORE.COM, INC.

                                1998 STOCK PLAN
                          (as amended June 21, 2000)

     1.   Purposes of the Plan. The purposes of this 1998 Stock Plan are to
attract and retain the best available personnel for positions of substantial
responsibility, to provide additional incentive to Employees and Consultants of
the Company and its Subsidiaries and to promote the success of the Company's
business. Options granted under the Plan may be Incentive Stock Options (as
defined under Section 422 of the Code) or Nonstatutory Stock Options, as
determined by the Administrator at the time of grant of an Option and subject to
the applicable provisions of Section 422 of the Code, as amended, and the
regulations promulgated thereunder. Stock purchase rights may also be granted
under the Plan.

     2.   Definitions.  As used herein, the following definitions shall apply:

          (a)  "Administrator" means the Board or any of its Committees
appointed pursuant to Section 4 of the Plan.

          (b)  "Affiliate" means an entity other than a Subsidiary (as defined
below) in which the Company owns an equity interest.

          (c)  "Applicable Laws" means the legal requirements relating to the
administration of stock option and restricted stock purchase plans under
applicable U.S. state corporate laws, U.S. federal and applicable state
securities laws, the Code, any stock exchange rules or regulations and the
applicable laws of any other country or jurisdiction where Options or Stock
Purchase Rights are granted under the Plan, as such laws, rules, regulations and
requirements shall be in place from time to time.

          (d)  "Board" means the Board of Directors of the Company.

          (e)  "Change in Control" means a sale of all or substantially all of
the Company's assets, or a merger, consolidation or other capital reorganization
of the Company with or into another corporation; provided however that a merger,
consolidation or other capital reorganization in which the holders of more than
50% of the shares of capital stock of the Company outstanding immediately prior
to such transaction continue to hold (either by the voting securities remaining
outstanding or by being converted into voting securities of the surviving
entity) more than 50% of the total voting power represented by the voting
securities of the Company, or such surviving entity, outstanding immediately
after such transaction shall not constitute a Change in Control.

          (f)  "Code" means the Internal Revenue Code of 1986, as amended.

          (g)  "Committee" means the Committee appointed by the Board of
Directors in accordance with Section 4(a) and (b) of the Plan.

          (h)  "Common Stock" means the Common Stock of the Company.

          (i)  "Company" means drugstore.com, inc., a Delaware corporation.

          (j)  "Consultant" means any person, including an advisor, who renders
services to the Company, or any Parent, Subsidiary or Affiliate, and is
compensated for such services, and any director of the Company whether
compensated for such services or not.

          (k)  "Continuous Status as an Employee or Consultant" means the
absence of any interruption or termination of service as an Employee or
Consultant. Continuous Status as an Employee or Consultant shall not be
considered interrupted in the case of: (i) sick leave; (ii) military leave;
(iii) any other leave of absence approved by the Administrator, provided that
such leave is for a period of not more than 90 days, unless reemployment upon
the expiration of such leave is guaranteed by contract or statute, or unless
provided otherwise pursuant to Company policy adopted from time to time; or (iv)
in the case of transfers between locations of the Company or between the
Company, its Parent(s), Subsidiaries, Affiliates or their respective successors.
For purposes of this Plan, a change in status from an Employee to a Consultant
or from a Consultant to an Employee will not constitute an interruption of
Continuous Status as an Employee or Consultant.

          (l)  "Director" means a member of the Board.

          (m)  "Employee" means any person (including if appropriate, any Named
Executive, Officer or Director) employed by the Company or any Parent,
Subsidiary or Affiliate of the Company, with the status of employment determined
based upon such minimum number of hours or periods worked as shall be determined
by the Administrator in its discretion, subject to any requirements of the Code.
The payment by the Company of a director's fee to a director shall not be
sufficient to constitute "employment" of such director by the Company.

          (n)  "Exchange Act" means the Securities Exchange Act of 1934, as
amended.
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          (o)  "Fair Market Value" means, as of any date, the fair market value
of Common Stock determined as follows:

               (i)  If the Common Stock is listed on any established stock
exchange or a national market system including without limitation the National
Market of the National Association of Securities Dealers, Inc. Automated
Quotation ("Nasdaq") System, its Fair Market Value shall be the closing sales
price for such stock (or the closing bid, if no sales were reported), as quoted
on such system or exchange, or the exchange with the greatest volume of trading
in Common Stock for the last market trading day prior to the time of
determination, as reported in The Wall Street Journal or such other source as
the Administrator deems reliable;

               (ii)  If the Common Stock is quoted on the Nasdaq System (but not
on the National Market thereof) or regularly quoted by a recognized securities
dealer but selling prices are not reported, its Fair Market Value shall be the
mean between the high bid and low asked prices for the Common Stock for the last
market trading day prior to the time of determination, as reported in The Wall
Street Journal or such other source as the Administrator deems reliable; or

               (iii)  In the absence of an established market for the Common
Stock, the Fair Market Value thereof shall be determined in good faith by the
Administrator.

          (p)  "Incentive Stock Option" means an Option intended to qualify as
an incentive stock option within the meaning of Section 422 of the Code, as
designated in the applicable written Option Agreement.

          (q)  "Listed Security" means any security of the Company that is
listed or approved for listing on a national securities exchange or designated
or approved for designation as a national market system security on an
interdealer quotation system by the National Association of Securities Dealers,
Inc.

          (r)  "Named Executive" means any individual who, on the last day of
the Company's fiscal year, is the chief executive officer of the Company (or is
acting in such capacity) or among the four most highly compensated officers of
the Company (other than the chief executive officer). Such officer status shall
be determined pursuant to the executive compensation disclosure rules under the
Exchange Act.

          (s)  "Nonstatutory Stock Option" means an Option not intended to
qualify as an Incentive Stock Option, as designated in the applicable written
Option Agreement.

          (t)  "Officer" means a person who is an officer of the Company within
the meaning of Section 16(a) of the Exchange Act and the rules and regulations
promulgated thereunder.

          (u)  "Option" means a stock option granted pursuant to the Plan.

          (v)  "Option Agreement" means a written agreement between an Optionee
and the Company reflecting the terms of an Option granted under the Plan and
includes any documents attached to such Option Agreement, including, but not
limited to, a notice of stock option grant and a form of exercise notice.

          (w)  "Option Exchange Program" means a program whereby outstanding
Options are exchanged for Options with a lower exercise price.

          (x)  "Optioned Stock" means the Common Stock subject to an Option or a
Stock Purchase Right.

          (y)  "Optionee" means an Employee or Consultant who receives an Option
or a Stock Purchase Right.

          (z)  "Parent" means a "parent corporation," whether now or hereafter
existing, as defined in Section 424(e) of the Code, or any successor provision.

          (aa) "Plan" means this 1998 Stock Plan.

          (bb) "Reporting Person" means an Officer, Director, or greater than
10% stockholder of the Company within the meaning of Rule 16a-2 under the
Exchange Act, who is required to file reports pursuant to Rule 16a-3 under the
Exchange Act.

          (cc) "Restricted Stock" means shares of Common Stock acquired pursuant
to a grant of a Stock Purchase Right under Section 11 below.

          (dd) "Restricted Stock Purchase Agreement" means a written agreement
between a holder of a Stock Purchase Right and the Company reflecting the terms
of a Stock Purchase Right granted under the Plan and includes any documents
attached to such agreement.

          (ee) "Rule 16b-3" means Rule 16b-3 promulgated under the Exchange Act,
as the same may be amended from time to time, or any successor provision.

          (ff) "Share" means a share of the Common Stock, as adjusted in
accordance with Section 13 of the Plan.

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          (gg) "Stock Exchange" means any stock exchange or consolidated stock
price reporting system on which prices for the Common Stock are quoted at any
given time.

          (hh) "Stock Purchase Right" means the right to purchase Common Stock
pursuant to Section 11 below.

          (ii) "Subsidiary" means a "subsidiary corporation," whether now or
hereafter existing, as defined in Section 424(f) of the Code, or any successor
provision.

     3.   Stock Subject to the Plan. Subject to the provisions of Section 13 of
the Plan, the maximum aggregate number of Shares that may be optioned and sold
under the Plan is 18,000,000 plus an annual increase on the first day of each of
the Company's fiscal years equal to the lesser of (i) 6,000,000 Shares or (ii)
five percent (5%) of the Shares then outstanding.  The Shares may be authorized,
but unissued, or reacquired Common Stock.  If an Option should expire or become
unexercisable for any reason without having been exercised in full, or is
surrendered pursuant to an Option Exchange Program, the unpurchased Shares that
were subject thereto shall, unless the Plan shall have been terminated, become
available for future grant under the Plan.  In addition, any Shares of Common
Stock which are retained by the Company upon exercise of an Option or Stock
Purchase Right in order to satisfy the exercise or purchase price for such
Option or Stock Purchase Right or any withholding taxes due with respect to such
exercise shall be treated as not issued and shall continue to be available under
the Plan.  Shares repurchased by the Company pursuant to any repurchase right
which the Company may have shall not be available for future grant under the
Plan.

     4.   Administration of the Plan.

          (a)  General.  The Plan shall be administered by the Board or a
Committee, or a combination thereof, as determined by the Board.  The Plan may
be administered by different administrative bodies with respect to different
classes of Optionees and, if permitted by the Applicable Laws, the Board may
authorize one or more officers (who may (but need not) be Officers) to grant
Options or Stock Purchase Rights to Employees and Consultants.

          (b)  Administration With Respect to Reporting Persons.  With respect
to Options granted to Reporting Persons and Named Executives, the Plan may (but
need not) be administered so as to permit such Options to qualify for the
exemption set forth in Rule 16b-3 and to qualify as performance-based
compensation under Section 162(m) of the Code.

          (c)  Committee Composition.  If a Committee has been appointed
pursuant to this Section 4, such Committee shall continue to serve in its
designated capacity until otherwise directed by the Board. From time to time the
Board may increase the size of any Committee and appoint additional members
thereof, remove members (with or without cause) and appoint new members in
substitution therefor, fill vacancies (however caused) and remove all members of
a Committee and thereafter directly administer the Plan, all to the extent
permitted by the Applicable Laws and, in the case of a Committee administering
the Plan pursuant to Section 4(b) above, to the extent permitted or required by
Rule 16b-3 and Section 162(m) of the Code.

          (d)  Powers of the Administrator.  Subject to the provisions of the
Plan and in the case of a Committee, the specific duties delegated by the Board
to such Committee, and subject to the approval of any relevant authorities,
including the approval, if required, of any Stock Exchange, the Administrator
shall have the authority, in its discretion:

               (i)  to determine the Fair Market Value of the Common Stock, in
accordance with Section 2(o) of the Plan;

               (ii)  to select the Consultants and Employees to whom Options and
Stock Purchase Rights or any combination thereof may from time to time be
granted hereunder;

               (iii)  to determine whether and to what extent Options and Stock
Purchase Rights or any combination thereof are granted hereunder;

               (iv) to determine the number of shares of Common Stock to be
covered by each such award granted hereunder;

               (v)  to approve forms of agreement for use under the Plan;

               (vi) to determine the terms and conditions, not inconsistent with
the terms of the Plan, of any award granted hereunder, which terms and
conditions include but are not limited to the exercise or purchase price, the
time or times when Options or Stock Purchase Rights may be exercised (which may
be based on performance criteria), any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or limitation regarding any Option,
Optioned Stock, Stock Purchase Right or Restricted Stock, based in each case on
such factors as the Administrator, in its sole discretion, shall determine;

               (vii)  to determine whether and under what circumstances an
Option may be settled in cash under Section 10(g) instead of Common Stock;

               (viii)  to reduce the exercise price of any Option to the then
current Fair Market Value if the Fair Market Value of the Common Stock covered
by such Option shall have declined since the date the Option was granted;

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               (ix) to determine the terms and restrictions applicable to Stock
Purchase Rights and the Restricted Stock purchased by exercising such Stock
Purchase Rights;

               (x)  to initiate an Option Exchange Program;

               (xi) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan; and

               (xii)  in order to fulfill the purposes of the Plan and without
amending the Plan, to modify grants of Options or Stock Purchase Rights to
participants who are foreign nationals or employed outside of the United States
in order to recognize differences in local law, tax policies or customs.

          (d)  Effect of Administrator's Decision. All decisions, determinations
and interpretations of the Administrator shall be final and binding on all
holders of Options or Stock Purchase Rights.

     5.   Eligibility.

          (a)  Recipients of Grants.  Nonstatutory Stock Options and Stock
Purchase Rights may be granted to Employees and Consultants.  Incentive Stock
Options may be granted only to Employees; provided however that Employees of
Affiliates shall not be eligible to receive Incentive Stock Options.  An
Employee or Consultant who has been granted an Option or Stock Purchase Right
may, if he or she is otherwise eligible, be granted additional Options or Stock
Purchase Rights.

          (b)  Type of Option.  Each Option shall be designated in the Option
Agreement as either an Incentive Stock Option or a Nonstatutory Stock Option.
However, notwithstanding such designations, to the extent that the aggregate
Fair Market Value of Shares with respect to which Options designated as
Incentive Stock Options are exercisable for the first time by any Optionee
during any calendar year (under all plans of the Company or any Parent or
Subsidiary) exceeds $100,000, such excess Options shall be treated as
Nonstatutory Stock Options.  For purposes of this Section 5(b), Incentive Stock
Options shall be taken into account in the order in which they were granted, and
the Fair Market Value of the Shares subject to an Incentive Stock Option shall
be determined as of the date of the grant of such Option.

          (c)  The Plan shall not confer upon the holder of any Option or Stock
Purchase Right any right with respect to continuation of employment or
consulting relationship with the Company, nor shall it interfere in any way with
such holder's right or the Company's right to terminate his or her employment or
consulting relationship at any time, with or without cause.

     6.   Term of Plan.  The Plan shall become effective upon the earlier to
occur of its adoption by the Board of Directors or its approval by the
stockholders of the Company as described in Section 20 of the Plan.  It shall
continue in effect for a term of ten years unless sooner terminated under
Section 16 of the Plan.

     7.   Term of Option.  The term of each Option shall be the term stated in
the Option Agreement; provided however that the term shall be no more than ten
years from the date of grant thereof or such shorter term as may be provided in
the Option Agreement and provided further that, in the case of an Incentive
Stock Option granted to an Optionee who, at the time the Option is granted, owns
stock representing more than 10% of the total combined voting power of all
classes of stock of the Company or any Parent or Subsidiary, the term of the
Option shall be five years from the date of grant thereof or such shorter term
as may be provided in the Option Agreement.

     8.   Limitation.  Subject to adjustment as provided in Section 14 below,
the maximum number of Shares which may be subject to Options and Stock Purchase
Rights granted to any one Employee under this Plan for any fiscal year of the
Company shall be 2,500,000 Shares.

     9.   Option Exercise Price and Consideration.

          (a)  The per share exercise price for the Shares to be issued pursuant
to exercise of an Option shall be such price as is determined by the Board and
set forth in the Option Agreement, but shall be subject to the following:

               (i)  In the case of an Incentive Stock Option that is:

                    (A)  granted to an Employee who, at the time of the grant
of such Incentive Stock Option, owns stock representing more than 10% of the
total combined voting power of all classes of stock of the Company or any Parent
or Subsidiary, the per Share exercise price shall be no less than 110% of the
Fair Market Value per Share on the date of grant.

                    (B)  granted to any other Employee, the per Share exercise
price shall be no less than 100% of the Fair Market Value per Share on the date
of grant.

               (ii) In the case of a Nonstatutory Stock Option, the per Share
exercise price shall be determined by the Administrator, provided however that
the per share exercise price of an Option granted to a Named Executive of the
Company shall be no less than 100% of the Fair Market Value per Share on the
date of grant if such Option is intended to qualify as performance-based
compensation under Section 162(m) of the Code.

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               (iii)  Notwithstanding the foregoing, Options may be granted with
a per Share exercise price other than as required above pursuant to a merger or
other corporate transaction.

          (b)  The consideration to be paid for the Shares to be issued upon
exercise of an Option, including the method of payment, shall be determined by
the Administrator (and, in the case of an Incentive Stock Option, shall be
determined at the time of grant) and may consist entirely of (1) cash, (2)
check, (3) promissory note (subject to the provisions of Section 153 of the
Delaware General Corporation Law), (4) cancellation of indebtedness, (5) other
Shares that (x) in the case of Shares acquired upon exercise of an Option, have
been owned by the Optionee for more than six months on the date of surrender or
such other period as may be required to avoid a charge to the Company's
earnings, and (y) have a Fair Market Value on the date of surrender equal to the
aggregate exercise price of the Shares as to which such Option shall be
exercised, (6) authorization for the Company to retain from the total number of
Shares as to which the Option is exercised that number of Shares having a Fair
Market Value on the date of exercise equal to the exercise price for the total
number of Shares as to which the Option is exercised, (7) delivery of a properly
executed exercise notice together with such other documentation as the
Administrator and the broker, if applicable, shall require to effect an exercise
of the Option and delivery to the Company of the sale or loan proceeds required
to pay the exercise price and any applicable income or employment taxes, (8)
delivery of an irrevocable subscription agreement for the Shares that
irrevocably obligates the option holder to take and pay for the Shares not more
than twelve months after the date of delivery of the subscription agreement, (9)
any combination of the foregoing methods of payment, or (10) such other
consideration and method of payment for the issuance of Shares to the extent
permitted under the Applicable Laws. In making its determination as to the type
of consideration to accept, the Administrator shall consider if acceptance of
such consideration may be reasonably expected to benefit the Company.

     10.  Exercise of Option.

          (a)  Procedure for Exercise; Rights as a Stockholder. Any Option
granted hereunder shall be exercisable at such times and under such conditions
as determined by the Administrator and reflected in the Option Agreement (or
other documentation provided by the Company), which may include vesting
requirements and/or including performance criteria with respect to the Company
and/or the Optionee. The Administrator shall have the discretion, after the
grant of an Option, to adjust the vesting of an Option held by an Employee or
Consultant as a result in a change in the terms or conditions under which such
person is providing services to the Company, or for any other reason. The
Administrator shall have the discretion to determine whether and to what extent
the vesting of Options shall be tolled during any unpaid leave of absence;
provided however that in the absence of such determination, vesting of Options
shall be tolled during any such leave.

     An Option may not be exercised for a fraction of a Share.

     An Option shall be deemed to be exercised when written notice of such
exercise has been given to the Company in accordance with the terms of the
Option by the person entitled to exercise the Option and the Company has
received full payment for the Shares with respect to which the Option is
exercised. Full payment may, as authorized by the Administrator, consist of any
consideration and method of payment allowable under Section 8(b) of the Plan.
Until the issuance (as evidenced by the appropriate entry on the books of the
Company or of a duly authorized transfer agent of the Company) of the stock
certificate evidencing such Shares, no right to vote or receive dividends or any
other rights as a stockholder shall exist with respect to the Optioned Stock,
not withstanding the exercise of the Option. The Company shall issue (or cause
to be issued) such stock certificate promptly upon exercise of the Option. No
adjustment will be made for a dividend or other right for which the record date
is prior to the date the stock certificate is issued, except as provided in
Section 12 of the Plan.

     Exercise of an Option in any manner shall result in a decrease in the
number of Shares that thereafter may be available, both for purposes of the Plan
and for sale under the Option, by the number of Shares as to which the Option is
exercised.

          (b)  Termination of Employment or Consulting Relationship. In the
event of termination of an Optionee's Continuous Status as an Employee or
Consultant with the Company, such Optionee may, but only within three months (or
such other period of time as is determined by the Administrator, with such
determination in the case of an Incentive Stock Option being made at the time of
grant of the Option) after the date of such termination (but in no event later
than the expiration date of the term of such Option as set forth in the Option
Agreement), exercise his or her Option to the extent that the Optionee was
entitled to exercise it at the date of such termination. To the extent that the
Optionee was not entitled to exercise the Option at the date of such
termination, or if the Optionee does not exercise such Option to the extent so
entitled within the time specified herein, the Option shall terminate and the
Optioned Stock underlying the unexercised portion of the Option shall revert to
the Plan. No termination shall be deemed to occur and this Section 9(b) shall
not apply if (i) the Optionee is a Consultant who becomes an Employee, or (ii)
the Optionee is an Employee who becomes a Consultant.

          (c)  Disability of Optionee. Notwithstanding Section 10(b) above, in
the event of termination of an Optionee's Continuous Status as an Employee or
Consultant as a result of his or her total and permanent disability (within the
meaning of Section 22(e)(3) of the Code), such Optionee may, but only within
twelve months from the date of such termination (but in no event later than the
expiration date of the term of such Option as set forth in the Option
Agreement), exercise the Option to the extent otherwise entitled to exercise it
at the date of such termination. To the extent that the Optionee was not
entitled to exercise the Option at the date of termination, or if the Optionee
does not exercise such Option to the extent so

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entitled within the time specified herein, the Option shall terminate and the
Optioned Stock underlying the unexercised portion of the Option shall revert to
the Plan.

          (d)  Death of Optionee. In the event of the death of an Optionee
during the period of Continuous Status as an Employee or Consultant since the
date of grant of the Option, or within 30 days following termination of the
Optionee's Continuous Status as an Employee or Consultant, the Option may be
exercised, at any time within six months following the date of death (but in no
event later than the expiration date of the term of such Option as set forth in
the Option Agreement), by such Optionee's estate or by a person who acquired the
right to exercise the Option by bequest or inheritance, but only to the extent
of the right to exercise that had accrued at the date of death or, if earlier,
the date of termination of the Optionee's Continuous Status as an Employee or
Consultant. To the extent that the Optionee was not entitled to exercise the
Option at the date of death or termination, as the case may be, or if the
Optionee does not exercise such Option to the extent so entitled within the time
specified herein, the Option shall terminate and the Optioned Stock underlying
the unexercised portion of the Option shall revert to the Plan.

          (e)  Extension of Exercise Period. The Administrator shall have full
power and authority to extend the period of time for which an Option is to
remain exercisable following termination of an Optionee's Continuous Status as
an Employee or Consultant from the periods set forth in Sections 10(b), 10(c)
and 10(d) above or in the Option Agreement to such greater time as the Board
shall deem appropriate, provided, that in no event shall such option be
exercisable later than the date of expiration of the term of such Option as set
forth in the Option Agreement.

          (f)  Rule 16b-3. Options granted to Reporting Persons shall comply
with Rule 16b-3 and shall contain such additional conditions or restrictions as
may be required thereunder to qualify for the maximum exemption for Plan
transactions.

          (g)  Buy-Out Provisions. The Administrator may at any time offer to
buy out for a payment in cash or Shares an Option previously granted based on
such terms and conditions as the Administrator shall establish and communicate
to the Optionee at the time such offer is made.

     11.  Stock Purchase Rights.

          (a)  Rights to Purchase. Stock Purchase Rights may be issued either
alone, in addition to, or in tandem with other awards granted under the Plan
and/or cash awards made outside of the Plan. After the Administrator determines
that it will offer Stock Purchase Rights under the Plan, it shall advise the
offeree in writing of the terms, conditions and restrictions related to the
offer, including the number of Shares that such person shall be entitled to
purchase, the price to be paid, and the time within which such person must
accept such offer, which shall in no event exceed 30 days from the date upon
which the Administrator made the determination to grant the Stock Purchase
Right. The offer shall be accepted by execution of a Restricted Stock Purchase
Agreement in the form determined by the Administrator.

          (b)  Repurchase Option. Unless the Administrator determines otherwise,
the Restricted Stock Purchase Agreement shall grant the Company a repurchase
option exercisable upon the voluntary or involuntary termination of the
purchaser's employment with the Company for any reason (including death or
disability). The purchase price for Shares repurchased pursuant to the
Restricted Stock Purchase Agreement shall be the original purchase price paid by
the purchaser and may be paid by cancellation of any indebtedness of the
purchaser to the Company.

          (c)  Other Provisions. The Restricted Stock Purchase Agreement shall
contain such other terms, provisions and conditions not inconsistent with the
Plan as may be determined by the Administrator in its sole discretion. In
addition, the provisions of Restricted Stock Purchase Agreements need not be the
same with respect to each purchaser.

          (d)  Rights as a Stockholder. Once the Stock Purchase Right is
exercised, the purchaser shall have the rights equivalent to those of a
stockholder, and shall be a stockholder when his or her purchase is entered upon
the records of the duly authorized transfer agent of the Company. No adjustment
will be made for a dividend or other right for which the record date is prior to
the date the Stock Purchase Right is exercised, except as provided in Section 12
of the Plan.

     12.  Tax Withholding.

          (a)  General. As a condition to the exercise of Options or Stock
Purchase Rights granted hereunder, the Optionee or holder of such Stock Purchase
Right shall make such arrangements as the Administrator may require for the
satisfaction of any federal, state, local or foreign withholding tax obligations
that may arise in connection with the exercise, receipt or vesting of such
award. The Company shall not be required to issue any Shares under the Plan
until such obligations are satisfied.

          (b)  Stock Withholding to Satisfy Withholding Tax Obligations. At the
discretion of the Administrator, Optionees may satisfy withholding obligations
as provided in this paragraph. When an Optionee incurs tax liability in
connection with an Option or Stock Purchase Right, which tax liability is
subject to tax withholding under applicable tax laws, and the Optionee is
obligated to pay the Company an amount required to be withheld under applicable
tax laws, the Optionee may satisfy the withholding tax obligation by one or some
combination of the following methods: (i) by cash or check payment, (ii) out of
the Optionee's current compensation, (iii) if permitted by the Administrator, in
its discretion, by

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surrendering to the Company Shares that (A) in the case of Shares previously
acquired from the Company, have been owned by the Optionee for more than six
months on the date of surrender, and (B) have a Fair Market Value on the date of
surrender equal to or less than the amount required to be withheld, or (iv) by
electing to have the Company withhold from the Shares to be issued upon exercise
of the Option, or the Shares to be issued in connection with the Stock Purchase
Right, if any, that number of Shares having a Fair Market Value equal to the
amount required to be withheld. For this purpose, the Fair Market Value of the
Shares to be withheld shall be determined on the date that the amount of tax to
be withheld is to be determined (the "Tax Date").

     Any surrender by a Reporting Person of previously owned Shares to satisfy
tax withholding obligations arising upon exercise of this Option must comply
with the applicable provisions of Rule 16b-3.

     All elections by an Optionee to have Shares withheld to satisfy tax
withholding obligations shall be made in writing in a form acceptable to the
Administrator and shall be subject to the following restrictions:

          (x)  the election must be made on or prior to the applicable Tax Date;

          (y)  once made, the election shall be irrevocable as to the particular
Shares of the Option or Stock Purchase Right as to which the election is made;
and

          (z)  all elections shall be subject to the consent or disapproval of
the Administrator.

     In the event the election to have Shares withheld is made by an Optionee
and the Tax Date is deferred under Section 83 of the Code because no election is
filed under Section 83(b) of the Code, the Optionee shall receive the full
number of Shares with respect to which the Option or Stock Purchase Right is
exercised but such Optionee shall be unconditionally obligated to tender back to
the Company the proper number of Shares on the Tax Date.

     13.  Adjustments Upon Changes in Capitalization, Merger or Certain Other
Transactions.

          (a)  Changes in Capitalization. Subject to any required action by the
stockholders of the Company, the number of shares of Common Stock covered by
each outstanding Option or Stock Purchase Right, and the number of shares of
Common Stock that have been authorized for issuance under the Plan but as to
which no Options or Stock Purchase Rights have yet been granted or that have
been returned to the Plan upon cancellation or expiration of an Option or Stock
Purchase Right, the number of Shares set forth in Section 8 above, as well as
the price per share of Common Stock covered by each such outstanding Option or
Stock Purchase Right, shall be proportionately adjusted for any increase or
decrease in the number of issued shares of Common Stock resulting from a stock
split, reverse stock split, stock dividend, combination, recapitalization or
reclassification of the Common Stock, or any other increase or decrease in the
number of issued shares of Common Stock effected without receipt of
consideration by the Company; provided, however, that conversion of any
convertible securities of the Company shall not be deemed to have been "effected
without receipt of consideration." Such adjustment shall be made by the Board,
whose determination in that respect shall be final, binding and conclusive.
Except as expressly provided herein, no issuance by the Company of shares of
stock of any class, or securities convertible into shares of stock of any class,
shall affect, and no adjustment by reason thereof shall be made with respect to,
the number or price of shares of Common Stock subject to an Option or Stock
Purchase Right.

          (b)  Dissolution or Liquidation. In the event of the proposed
dissolution or liquidation of the Company, the Board shall notify the Optionee
at least 15 days prior to such proposed action. To the extent it has not been
previously exercised, the Option or Stock Purchase Right will terminate
immediately prior to the consummation of such proposed action.

          (c)  Change in Control. In the event of a Change in Control, each
outstanding Option or Stock Purchase Right shall be assumed or an equivalent
option or right shall be substituted by the successor corporation or a Parent or
Subsidiary of such successor corporation, unless such successor corporation does
not agree to assume the outstanding Options or Stock Purchase Rights or to
substitute equivalent options or rights, in which case such Options or Stock
Purchase Rights shall terminate upon the consummation of the transaction. For
purposes of this Section 13(c), an Option or a Stock Purchase Right shall be
considered assumed, without limitation, if, at the time of issuance of the stock
or other consideration upon such Change in Control, each holder of an Option or
Stock Purchase Right would be entitled to receive upon exercise of the Option or
Stock Purchase Right the same number and kind of shares of stock or the same
amount of property, cash or securities as such holder would have been entitled
to receive upon the occurrence of the transaction if the holder had been,
immediately prior to such transaction, the holder of the number of Shares of
Common Stock covered by the Option or the Stock Purchase Right at such time
(after giving effect to any adjustments in the number of Shares covered by the
Option or Stock Purchase Right as provided for in this Section 13); provided
however that if such consideration received in the Change in Control was not
solely common stock of the successor corporation or its Parent, the
Administrator may, with the consent of the successor corporation, provide for
the consideration to be received upon exercise of the Option to be solely common
stock of the successor corporation or its Parent equal to the Fair Market Value
of the per Share consideration received by holders of Common Stock in the
transaction.

          (d)  Certain Distributions. In the event of any distribution to the
Company's stockholders of securities of any other entity or other assets (other
than dividends payable in cash or stock of the Company) without receipt of
consideration by the Company, the Administrator may, in its discretion,
appropriately adjust the price per Share of Common Stock covered by each
outstanding Option or Stock Purchase Right to reflect the effect of such
distribution.

                                      -7-
<PAGE>

     14.  Non-Transferability of Options and Stock Purchase Rights. Options and
Stock Purchase Rights may not be sold, pledged, assigned, hypothecated,
transferred, or disposed of in any manner other than by will or by the laws of
descent or distribution, provided that, after the date, if any, upon which the
Common Stock becomes a Listed Security, the Administrator may in its discretion
grant transferable Nonstatutory Stock Options pursuant to Option Agreements
specifying (i) the manner in which such Nonstatutory Stock Options are
transferable and (ii) that any such transfer shall be subject to the Applicable
Laws. The designation of a beneficiary by an Optionee will not constitute a
transfer. An Option or Stock Purchase Right may be exercised, during the
lifetime of the holder of the Option or Stock Purchase Right, only by such
holder or a transferee permitted by this Section 14.

     15.  Time of Granting Options and Stock Purchase Rights. The date of grant
of an Option or Stock Purchase Right shall, for all purposes, be the date on
which the Administrator makes the determination granting such Option or Stock
Purchase Right, or such other date as is determined by the Board; provided,
however, that in the case of any Incentive Stock Option, the grant date shall be
the later of the date on which the Administrator makes the determination
granting such Incentive Stock Option or the date of commencement of the
Optionee's employment relationship with the Company. Notice of the determination
shall be given to each Employee or Consultant to whom an Option or Stock
Purchase Right is so granted within a reasonable time after the date of such
grant.

     16.  Amendment and Termination of the Plan.

          (a)  Authority to Amend or Terminate. The Board may at any time amend,
alter, suspend or discontinue the Plan, but no amendment, alteration, suspension
or discontinuation (other than an adjustment made pursuant to Section 13 above)
shall be made that would impair the rights of any Optionee under any grant
theretofore made, without his or her consent. In addition, to the extent
necessary and desirable to comply with the Applicable Laws the Company shall
obtain stockholder approval of any Plan amendment in such a manner and to such a
degree as required.

          (b)  Effect of Amendment or Termination. No amendment or termination
of the Plan shall adversely affect Options already granted, unless mutually
agreed otherwise between the Optionee and the Administrator, which agreement
must be in writing and signed by the Optionee and the Company.

     17.  Conditions Upon Issuance of Shares. Shares shall not be issued
pursuant to the exercise of an Option or Stock Purchase Right unless the
exercise of such Option or Stock Purchase Right and the issuance and delivery of
such Shares pursuant thereto shall comply with all relevant provisions of law,
including, without limitation, the Securities Act of 1933, as amended, the
Exchange Act, the rules and regulations promulgated thereunder, and the
requirements of any Stock Exchange.

     As a condition to the exercise of an Option, the Company may require the
person exercising such Option to represent and warrant at the time of any such
exercise that the Shares are being purchased only for investment and without any
present intention to sell or distribute such Shares if, in the opinion of
counsel for the Company, such a representation is required by law.

     18.  Reservation of Shares. The Company, during the term of this Plan, will
at all times reserve and keep available such number of Shares as shall be
sufficient to satisfy the requirements of the Plan. The inability of the Company
to obtain authority from any regulatory body having jurisdiction, which
authority is deemed by the Company's counsel to be necessary to the lawful
issuance and sale of any Shares hereunder, shall relieve the Company of any
liability in respect of the failure to issue or sell such Shares as to which
such requisite authority shall not have been obtained.

     19.  Agreements. Options and Stock Purchase Rights shall be evidenced by
written or electronic Option Agreements and Restricted Stock Purchase
Agreements, respectively, in such form(s) as the Administrator shall approve
from time to time.

     20.  Stockholder Approval. If required by the Applicable Laws, continuance
of the Plan shall be subject to approval by the stockholders of the Company
within twelve months before or after the date the Plan is adopted. Such
stockholder approval shall be obtained in the degree and manner required under
the Applicable Laws. All Options and Stock Purchase Rights issued under the Plan
shall become void in the event such approval is not obtained.

     21.  Documents to Optionees. At the time of issuance of any awards under
the Plan, the Company shall provide to the recipient of such award a copy of the
Plan and any agreement(s) pursuant to which awards granted under the Plan are
issued.

     22.  Awards Granted to California Residents. Options and Stock Purchase
Rights granted under the Plan to persons resident in California shall be subject
to the provisions set forth in Attachment A hereto. To the extent the provisions
of the Plan conflict with the provisions set forth on Attachment A, the
provisions on Attachment A shall govern the terms of such Options.

                                      -8-
<PAGE>

                                 Attachment A

                   Provisions Applicable to Award Recipients
                            Resident in California

     Until such time as any security of the Company becomes a Listed Security
and if required by the Applicable Laws, the following additional terms shall
apply to Options and Stock Purchase Rights, and Shares issued upon exercise of
such awards, granted under the drugstore.com, inc. 1998 Stock Plan (the "Plan")
to persons resident in California as of the date of grant of any such award
(each such person, a "California Recipient"):

     1.   In the case of a Nonstatutory Stock Option, that is:

          (a)  granted to granted to a California Recipient who, at the time of
the grant of such Option, owns stock representing more than 10% of the total
combined voting power of all classes of stock of the Company or any Parent or
Subsidiary, the per Share exercise price shall be no less than 110% of the Fair
Market Value on the date of grant.

          (b)  granted to any California Recipient who is a Named Executive of
the Company, the per Share exercise price shall be no less than 100% of the Fair
Market Value per Share on the date of grant.

          (c)  granted to any other California Recipient, the per Share exercise
price shall be no less than 85% of the Fair Market Value per Share on the date
of grant.

     2.   In the case of Stock Purchase Rights granted to a California
Recipient, the purchase price applicable to such right shall not be less than
85% of the Fair Market Value of the Shares as of the date of the offer, or, in
the case of a person owning stock representing more than 10% of the total
combined voting power of all classes of stock of the Company or any Parent or
Subsidiary, the price shall not be less than 100% of the Fair Market Value of
the Shares as of the date of the offer.

     3.   With respect to an Option or Stock Purchase Right issued to any
California Recipient who is not an Officer, Director or Consultant, such Option
or Stock Purchase Right shall become exercisable, or any repurchase option in
favor of the Company shall lapse, at the rate of at least 20% per year over five
years from the date the award is granted.

     4.   (a)  Subject to Section 10(c) of the Plan and to Section 4(b) below,
in the event of termination of a California Recipient's Continuous Status as an
Employee or Consultant with the Company, such California Recipient shall have at
least 30 days after the date of such termination (but in no event later than the
expiration of the term of such Option as set forth in the Option Agreement) to
exercise such Option.

          (b)  In the event of termination of a California Recipient's
Continuous Status as an Employee or Consultant as a result of a disability which
does not fall within the meaning of total and permanent disability (as set forth
in Section 22(e)(3) of the Code), such California Recipient may, but only within
six months from the date of such termination (but in no event later than the
expiration date of the term of such Option as set forth in the Option
Agreement), exercise the Option to the extent otherwise entitled to exercise it
at the date of such termination. However, to the extent that such California
Recipient fails to exercise an Option which is an Incentive Stock Option (within
the meaning of Section 422 of the Code) within three months of the date of such
termination, the Option will not qualify for Incentive Stock Option treatment
under the Code. To the extent that the California Recipient was not entitled to
exercise the Option at the date of termination, or if the California Recipient
does not exercise such Option to the extent so entitled within six months from
the date of termination, the Option shall terminate and the Optioned Stock
underlying the unexercised portion of the Option shall revert to the Plan.

     5.   The Company shall provide financial statements at least annually to
each California Recipient during the period such person has one or more Options
or Stock Purchase Rights outstanding, and in the case of an individual who
acquired Shares pursuant to the Plan, during the period such individual owns
such Shares.  The Company shall not be required to provide such information if
the issuance of awards under the Plan is limited to key employees whose duties
in connection with the Company assure their access to equivalent information.

     6.   Capitalized terms not defined in this Attachment shall have the
meanings set forth in the Plan.

                                      -9-<PAGE>

                                                                    Exhibit 10.1

                            AMENDMENT NO. 1 TO THE
                          ENBREL(R) SUPPLY AGREEMENT

[*] Certain information in this Exhibit has been omitted and filed separately
with the Securities and Exchange Commission pursuant to a confidential treatment
request.

<PAGE>

                            AMENDMENT NO. 1 TO THE

                          ENBREL(R) SUPPLY AGREEMENT

     This Amendment No. 1 ("Amendment No. 1") is made this 27th day of June,
2000 (the "Amendment Effective Date") by and among IMMUNEX CORPORATION, a
corporation of the State of Washington, having its principal place of business
at 51 University Street, Seattle, Washington 98101, U.S.A., together with its
Affiliates ("Immunex"), AMERICAN HOME PRODUCTS CORPORATION, a corporation of the
State of Delaware having its corporate headquarters at Five Giralda Farms,
Madison, New Jersey 07940, U.S.A. ("AHPC"), acting through its Wyeth-Ayerst
Laboratories division, having offices at 555 East Lancaster Avenue, St. Davids,
Pennsylvania 19087, U.S.A. ("Wyeth"), and BOEHRINGER INGELHEIM PHARMA KG, a
German corporation having a place of business at Birkendorfer Strasse 65, 88397
Biberach an der Riss, Federal Republic of Germany ("BIP"), and amends the Enbrel
Supply Agreement effective as of November 5, 1998, by and among Immunex, Wyeth,
and BIP (the "Agreement").

     WHEREAS, Immunex, Wyeth and BIP have entered into a certain Agreement for
BIP's supply of Enbrel(R) (etanercept) to Immunex and Wyeth;

     WHEREAS, Immunex and Wyeth desire to have BIP manufacture additional
quantities of Enbrel, and accordingly, on January 20, 2000, the Parties signed a
certain Summary Term Sheet specifying terms and conditions under which BIP would
receive certain incentives to enhance the yield from BIP's current production
capacity for Enbrel and to perform good faith outsourcing activities with the
goal of providing additional near-term bulk drug substance runs for Enbrel;

     WHEREAS, pursuant to Section 23.9 of the Agreement, the Agreement may only
be amended and supplemented by a written instrument signed by the Parties;

     NOW THEREFORE, in consideration of the mutual covenants contained herein,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the Parties hereto, each intending to be legally
bound, hereby agree as follows:

     1.   Capitalized Terms. All initially capitalized terms used herein and not
defined shall have the meanings set forth in the Agreement.

     2.   New Definitions. Section 1.66 of the Agreement shall be amended to add
the following new definitions:
                                                             Section
     "Accepted Subsequent Additional Runs"                   24.1(d)(2)
     "Adjusted Annual Minimum"                               5.10(c)
     "Annual Minimum"                                        5.10(b)
     "Attempted Original Additional Run"                     24.1(a)(2)
<PAGE>

     "Binding Production Schedule"                            24.1(a)(1)(i)
     "Confirmed Outsourcing Costs"                            24.1(a)
     "Outsourcing Activities"                                 24.1(a)
     "Original Additional Run"                                24.1(a)(1)
     "ROFR"                                                   24.1(d)(2)
     "Subsequent Additional Runs"                             24.1(c)(3)
     "Successful Outsourcing Activities"                      24.3
     "Unsuccessful Outsourcing Activities"                    24.2

     3.   Semi-Exclusive Rights. In consideration of the mutual covenants set
forth in this Amendment No. 1, a new Section 3.4 shall be added to the Agreement
as follows:

          3.4 Semi-Exclusive Rights. Subject to Section 5.10(c) hereof, BIP's
rights to manufacture Bulk Drug Substance and Drug Product for Immunex and Wyeth
hereunder shall be converted from exclusive (subject to the provisions of
Section 3.2 and 3.3 hereof) to semi-exclusive with Immunex and Wyeth. Thus, in
addition to the Firm Orders for Bulk Drug Substance and Drug Product placed by
the Buyer with BIP in accordance with the terms of this Agreement, Immunex and
Wyeth shall also have the right to (a) manufacture any quantities of Bulk Drug
Substance in Wyeth's West Greenwich, Rhode Island manufacturing facility or in
such other manufacturing facility, including but not limited to, Wyeth's
proposed manufacturing facility in Ireland, that is at least [*] percent ([*]%)
owned by Immunex or Wyeth or by an Affiliate of either Immunex or Wyeth and (b)
determine where the Bulk Drug Substance produced from any such Immunex or Wyeth-
owned manufacturing facility would be converted into drug product (unlabeled
vials), it being understood that any facility converting such Bulk Drug
Substance to drug product for Immunex or Wyeth could be owned by Immunex, Wyeth,
by an Affiliate of either Immunex or Wyeth, or by a Third Party.

     4.   Maximum Request and Annual Minimum. In consideration of BIP's consent
to convert its exclusive manufacturing rights to semi-exclusive manufacturing
rights described in Paragraph 3 of this Amendment No. 1 and BIP's good faith
outsourcing efforts, the Agreement shall be amended to add the following new
Section 5.10, as follows:

          5.10   Maximum Request; Annual Minimum.

                 (a)   Maximum Request. Subject to Section 5.10(c) below,
                       beginning on [*] and continuing through [*], the annual
                       Maximum Request in the Agreement shall be equal to the
                       Annual Minimum as defined in Section 5.10(b) below.
                       Beginning [*], or as otherwise set forth in Section
                       5.10(c) below, the Maximum Request shall revert to the
                       terms in the original Agreement. Immunex and Wyeth shall
                       waive their ability to reduce the Maximum Request below
                       the Annual Minimum under Section 5.1(b) hereof until an
                       effective date of [*] at the earliest, except to the
                       extent otherwise permitted in Section 5.10(c) below.
                       Subject to Section 5.10(c) below, beginning on [*] and
                       continuing through the

[*] Confidential Treatment Requested

                                       2
<PAGE>

                       end of the Supply Term, Immunex and Wyeth shall be
                       entitled to reduce the Maximum Request (unless otherwise
                       agreed in writing among the Parties, to be calculated by
                       using the original Maximum Request herein) by no more
                       than [*] percent ([*]%) per Calendar Year by providing at
                       least the required [*] ([*]) months' prior written notice
                       to BIP (e.g., notice by [*] for a potential reduction in
                       the Maximum Request effective as of [*], etc.).

                       It is understood by the Parties that the Maximum Request
                       valid through [*] shall not constitute a guaranty by BIP
                       to reserve permanent capacity through [*] exceeding the
                       original Maximum Request of [*] Bulk Drug Substance Runs.
                       However, to carry out the Parties' intentions, to the
                       extent that BIP acquires any Original Additional Run or
                       Subsequent Additional Run as a result of its Outsourcing
                       Activities, (1) all such Original Additional Runs shall
                       be reserved for Buyer through [*] and (2) Buyer shall
                       have a ROFR for any Subsequent Additional Run during
                       Calendar Years [*] and [*], and such ROFR shall be
                       exercised according to Section 24.1(d)(2) hereof.
                       Moreover, the absolute minimum of the Maximum Request
                       after permitted reductions under Section 5.1(b) of the
                       original Agreement shall always be the required capacity
                       for [*] kg of Bulk Drug Substance calculated in
                       accordance with the original Production Assumptions
                       herein.

                 (b)   Annual Minimum. Buyer shall guarantee BIP an annual
                       minimum of [*] Bulk Drug Substance Runs (the "Annual
                       Minimum") through [*], subject to the terms of this
                       Agreement. The [*] Bulk Drug Substance Runs is believed
                       to be equivalent to the capacity [*] BIP [*] L
                       fermenters. Subject to Section 5.10(c) below, beginning
                       on [*] and continuing through the end of the Supply Term,
                       Immunex and Wyeth shall have the same ability to reduce
                       the Annual Minimum as they have to reduce the Maximum
                       Request as provided in Section 5.10(a) above and Section
                       5.10(c) below.

                 (c)   Potential Adjustment to the Maximum Request and Annual
                       Minimum. Notwithstanding anything herein to the contrary,
                       if Immunex and Wyeth reasonably determine in good faith
                       that the yearly worldwide market requirements for Bulk
                       Drug Substance will fall below the Annual Minimum for a
                       particular Calendar Year (such calculation to be based on
                       the prior year's Production Assumptions and the basic
                       success rate laid down in Section 5.1(a)(1) of the
                       original Agreement), and Immunex and Wyeth provide
                       written notice thereof to BIP, including a certification

[*] Confidential Treatment Requested

                                       3
<PAGE>

                       signed by an officer of Immunex and Wyeth that verifies
                       their forecast for worldwide market requirements for Bulk
                       Drug Substance for the respective Calendar Year, then the
                       terms set forth in Section 5.1(b) of the original
                       Agreement regarding downward adjustments in the Maximum
                       Request shall apply and shall supersede the provisions in
                       Section 5.10(a) above regarding revisions to the Maximum
                       Request and the provisions in Section 5.10(b) above
                       regarding revisions to the Annual Minimum. Thereafter,
                       and for so long during the Supply Term that the yearly
                       worldwide market requirements for Bulk Drug Substance
                       remain below the Annual Minimum, and except as otherwise
                       agreed among the Parties, Buyer shall guarantee BIP an
                       adjusted annual minimum (the "Adjusted Annual Minimum")
                       that shall supersede the Annual Minimum. The Adjusted
                       Annual Minimum shall be the greater of (1) [*] contained
                       in the [*] provided to BIP by Immunex and Wyeth for [*]
                       or (2) [*], as such [*] by Immunex and Wyeth pursuant to
                       [*]. If the [*] are higher than the [*] thereof provided
                       by Immunex and Wyeth to BIP [*]shall be adjusted [*].

                       If the [*] is applicable, then [*]. Immunex and Wyeth
                       shall [*] for [*] greater than either (i) [*] or (ii)
                       [*]. Immunex and Wyeth shall in a timely manner inform
                       BIP in writing of [*],

[*] Confidential Treatment Requested

                                       4
<PAGE>

                       and BIP shall within thirty (30) days after receipt of
                       such notice provide its own written notice to Immunex and
                       Wyeth of which option BIP has selected (i.e., either (i)
                       or (ii) in the immediately preceding sentence).

                       By way of example only, if [*]

     5.   Extension of Supply Term of Agreement. In consideration of BIP's
consent to convert its exclusive manufacturing rights to semi-exclusive
manufacturing rights as described in Paragraph 3 of this Amendment No. 1,
Section 19.1 of the Agreement shall be amended and restated as follows:

          19.1  Term; Renewal.
                Unless sooner terminated pursuant to the terms of this
                Agreement, the term of this Agreement shall commence upon the
                Effective Date and shall continue thereafter until at least [*]
                (the "Supply Term"). This Agreement and the Supply Term shall
                automatically continue from Calendar Year-to-Calendar Year
                thereafter unless terminated by either Party by providing at
                least [*] years' prior

[*] Confidential Treatment Requested

                                       5
<PAGE>

                written notice to the other Party, provided that neither Party
                may provide such notice prior to the end of the [*] Contract
                Year, i.e., [*]. For purposes of this Section 19.1, Immunex and
                Wyeth shall be deemed the same Party.

     6.   New Article 24. The Agreement shall be amended to add the following
new provision, Article 24, as follows:

                ARTICLE 24.  CONTRACTUAL INCENTIVES TO BIP FOR
                            OUTSOURCING ACTIVITIES

24.1 Costs of Outsourcing; Ordering Additional Runs; [*] Pricing for Additional
     Runs; ROFR; Drug Product and Finished Product Capacity.

     (a)  Costs of Outsourcing. Buyer shall pay [*] percent ([*]%) of the costs
          of BIP's Outsourcing Activities (as defined below), not to exceed DM
          [*] ([*]Deutsche Mark), that are directly related to BIP providing the
          additional Bulk Drug Substance Runs for the Product, as described
          below. These outsourcing costs, which BIP shall further demonstrate
          for Buyer by having BIP's outside auditor provide Buyer prior to any
          payments according to Section 24.1(a)(1) below a letter confirming
          that the DM [*] ([*] Deutsche Mark) figure, or any other amount not to
          exceed such figure (the "Confirmed Outsourcing Costs"), is a fair
          calculation of BIP's costs for Outsourcing Activities, are in the
          order of DM [*] ([*] Deutsche Mark) for technology transfer and DM [*]
          ([*] Deutsche Mark) in loss of profitability.

          For purposes hereof, "Outsourcing Activities" shall mean that BIP has
          and shall forthwith act in good faith and use commercially reasonable
          efforts to diligently and in a timely manner pursue the outsourcing of
          such products that BIP reasonably has determined to be and forthwith
          reasonably determines would be necessary to free-up the [*] Original
          Additional Runs (as defined below) within the [*]month period from [*]
          to [*], which activities shall include BIP's efforts and commitment of
          financial resources (in the order of DM [*] for technology transfer)
          and personnel resources commensurate to those efforts and resources
          that would be employed by BIP to make additional near-term production
          capacity available for a product having similar market potential as
          the Product, it being understood that BIP is not promising the success
          of these efforts nor guaranteeing that it will be able to make
          available the Original Additional Runs.

          (1)   [*] percent ([*]%) of the Confirmed Outsourcing Costs shall be
                paid by Buyer to BIP according to the following schedule:

                (i)    [*] percent ([*]%) of the Confirmed Outsourcing Costs
                       shall be paid when BIP provides a written, binding
                       production schedule (the "Binding Production Schedule")
                       to Buyer that

[*] Confidential Treatment Requested

                                       6
<PAGE>

                       indicates a total of at least [*] Bulk Drug Substance
                       Runs (comprised of [*] Bulk Drug Substance Runs at the
                       beginning of 2000 carried over from 1999 + [*] Bulk Drug
                       Substance Runs from 2000 + [*] Bulk Drug Substance Runs
                       in the first [*] months of 2001 + at least [*] additional
                       Bulk Drug Substance Runs) over the [*]-month period from
                       [*] to [*], and also indicates a total of at least [*]
                       Bulk Drug Substance Runs (comprised of the [*] carryover
                       Bulk Drug Substance Runs + [*] Bulk Drug Substance Runs
                       in 2000 + [*] Bulk Drug Substance Runs in 2001 + at least
                       [*] additional Bulk Drug Substance Runs) over the [*]-
                       month period from [*] to [*]. Such amount shall be
                       nonrefundable when paid.

                (ii)   [*] percent ([*]%) of the Confirmed Outsourcing Costs
                       shall be paid when BIP provides a Binding Production
                       Schedule to Buyer that indicates a total of at least [*]
                       Bulk Drug Substance Runs (comprised of [*] Bulk Drug
                       Substance Runs at the beginning of 2000 carried over from
                       1999 + [*] Bulk Drug Substance Runs from 2000 + [*] Bulk
                       Drug Substance Runs in the first [*] months of 2001 + at
                       least [*] additional Bulk Drug Substance Runs) over the
                       [*]-month period from [*] to [*], and also indicates a
                       total of at least [*] Bulk Drug Substance Runs (comprised
                       of the [*] carryover Bulk Drug Substance Runs + [*] Bulk
                       Drug Substance Runs in 2000 + [*] Bulk Drug Substance
                       Runs in 2001 + at least [*] additional Bulk Drug
                       Substance Runs) over the [*]-month period from [*] to
                       [*]. Such amount shall be nonrefundable when paid.

                (iii)  [*] percent ([*]%) of the Confirmed Outsourcing Costs
                       shall be paid when BIP provides a Binding Production
                       Schedule to Buyer that indicates a total of [*] Bulk Drug
                       Substance Runs (comprised of [*] Bulk Drug Substance Runs
                       at the beginning of 2000 carried over from 1999 + [*]
                       Bulk Drug Substance Runs from 2000 + [*] Bulk Drug
                       Substance Runs in the first [*] months of 2001 + [*]
                       additional Bulk Drug Substance Runs) over the [*]-month
                       period from [*] to [*], and also indicates a total of [*]
                       Bulk Drug Substance Runs (comprised of the [*] carryover
                       Bulk Drug Substance Runs + [*] Bulk Drug Substance Runs
                       in 2000 + [*] Bulk Drug Substance Runs in 2001 + [*]
                       additional Bulk Drug Substance Runs) over the [*]-month
                       period from [*] to [*]. Such amount shall be
                       nonrefundable when paid.

[*] Confidential Treatment Requested

                                       7
<PAGE>

                       The additional Bulk Drug Substance Runs to be performed
                       by BIP for Buyer over the [*]-month period from [*] to
                       [*] (each of these additional Bulk Drug Substance Runs
                       shall be referred to as an "Original Additional Run," and
                       collectively, as the "Original Additional Runs") shall be
                       incremental to the [*] Bulk Drug Substance Runs for the
                       Product in 2000 (comprised of the [*] carryover Bulk Drug
                       Substance Runs + [*] Bulk Drug Substance Runs) and the
                       [*] Bulk Drug Substance Runs for the Product in 2001. On
                       each Binding Production Schedule, BIP shall clearly
                       identify to Buyer by asterisk or otherwise which Bulk
                       Drug Substance Runs are the Original Additional Runs. Any
                       subsequent revisions to a Binding Production Schedule
                       must be agreed upon in writing by the Parties.

          (2)  Regardless of whether or not BIP has provided a Binding
               Production Schedule to Buyer under Section 24.1(a)(1) above, [*]
               percent ([*]%) of the Confirmed Outsourcing Costs shall be paid
               by Buyer to BIP on an incremental basis, i.e., Buyer shall pay
               [*] percent ([*]%) of the Confirmed Outsourcing Costs to BIP for
               each Attempted Original Additional Run prior to [*].  For
               purposes hereof, an "Attempted Original Additional Run" shall
               mean that BIP in good faith attempted a Bulk Drug Substance Run
               that advanced to at least [*].

     (b)  Firm Order for the Original Additional Runs.  Buyer hereby issues a
          Firm Order for all of the Original Additional Runs made available
          during the period from [*] through [*].  Such Firm Order shall
          constitute a binding order for every Original Additional Run that BIP
          makes available as set forth in the Binding Production Schedule or as
          otherwise agreed upon in writing by the Parties, not to exceed [*]
          Original Additional Runs without Buyer's prior written approval.  As
          the Parties are of the common opinion that any Original Additional Run
          would be the result of BIP's good faith outsourcing activities with
          the goal of providing additional near-term Bulk Drug Substance Runs
          for the Product, BIP shall in no way be liable to Buyer or anybody
          else for the non-fulfillment of such Firm Orders for the Original
          Additional Runs.

     (c)  [*] Pricing.  The Bulk Drug Substance price shall be set at a total of
          DM [*]/gram for each Bulk Drug Substance Run greater than

          (1)  [*] Bulk Drug Substance Runs (comprised of the [*] carryover Bulk
               Drug Substance Runs + [*] Bulk Drug Substance Runs in 2000 + [*]
               Bulk Drug Substance Runs in the first [*] months of 2001) that is
               performed over the [*]-month period from [*]to [*],

          (2)  [*] Bulk Drug Substance Runs (comprised of the [*] carryover Bulk
               Drug Substance Runs + [*] Bulk Drug Substance

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               Runs in 2000 + [*] Bulk Drug Substance Runs in 2001) that is
               performed over the [*]-month period from [*]to [*], provided,
               however, that any Bulk Drug Substance Run eligible for [*]
               pricing under Section 24.1(c)(1) above shall not be eligible for
               [*] pricing under this Section 24.1(c)(2), and

          (3)  [*] Bulk Drug Substance Runs that is performed per year for
               Calendar Years [*] (for each of these [*] Calendar Years, the
               additional Bulk Drug Substance Runs made available by BIP to
               Buyer in the particular Calendar Year shall be referred to as the
               "Subsequent Additional Runs"), provided, however, that the number
               of Bulk Drug Substance Runs that are performed in each of [*]
               (for the last [*] months of [*]) [*] that are eligible for the
               [*] pricing shall not exceed the difference between the number of
               actual Bulk Drug Substance Runs that are performed between [*]to
               [*] and [*] Bulk Drug Substance Runs (comprised of the [*]
               carryover Bulk Drug Substance Runs + [*] Bulk Drug Substance Runs
               in 2000 + [*] Bulk Drug Substance Runs in 2001).

          [*]

     (d)  BIP Written Notice of Subsequent Additional Runs; ROFR for Subsequent
          Additional Runs.

          (1)  By [*], BIP shall provide written notice to Buyer of the number
               of Subsequent Additional Runs that are available in [*].By [*],
               BIP shall provide written notice to Buyer of the number of
               Subsequent Additional Runs that are available in [*].

          (2)  Buyer shall have the right of first refusal as to any Third
               Parties (the "ROFR") to order any or all of such Subsequent
               Additional Runs in [*] and [*] to the extent provided in this
               paragraph, in either Calendar Year not to exceed [*] Subsequent
               Additional Runs without Buyer's prior written approval.  This
               ROFR for Subsequent Additional Runs with respect to [*] and [*],
               respectively, shall be exercised by Buyer, if at all, by
               providing written notice to BIP, within [*] days after BIP's
               written notice to Buyer of the number of Subsequent Additional
               Runs that BIP would make available in [*] or [*], as applicable,
               of that number of such Subsequent Additional Runs for which Buyer
               thereby issues a Firm Order (the "Accepted Subsequent Additional
               Runs").  Upon receipt of any such notice from Buyer, such Firm
               Orders shall constitute binding orders, and BIP shall dedicate
               all of such Accepted Subsequent Additional Runs for the
               production of Bulk

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<PAGE>

               Drug Substance.

     (e)  Potential Refund of Confirmed Outsourcing Costs.  If BIP does not
          attempt at least [*] Accepted Subsequent Additional Runs in [*], then
          no later than [*], BIP shall refund to Buyer a total of [*] percent
          ([*]%) of the Confirmed Outsourcing Costs previously paid by Buyer for
          the Original Additional Runs under Section [*] above.

     (f)  Drug Product and Finished Product Capacity.  BIP hereby undertakes to
          maintain sufficient manufacturing capacity and a sufficient number of
          employees with such expertise and experience as is necessary or
          appropriate to convert the Bulk Drug Substance Lots resulting from the
          Original Additional Runs and the Accepted Subsequent Additional Runs
          into Drug Product and, if ordered, Finished Product, in accordance
          with the terms hereof, including without limitation, Section 4.3
          hereof.

24.2  Additional Contractual Incentives for Unsuccessful Outsourcing Activities.
     Instead of, and not in addition to, the contractual incentives and other
     terms provided to BIP in Section 24.3 below for Successful Outsourcing
     Activities (as defined below), BIP shall receive the following contractual
     incentives and be subject to the following terms set forth in this Section
     24.2 as a result of Unsuccessful Outsourcing Activities, or alternatively,
     under the conditions specified in Section 24.3(e) below.  For purposes
     hereof, "Unsuccessful Outsourcing Activities" shall mean that despite BIP's
     Outsourcing Activities, BIP has been unable to provide Buyer at least [*]
     successful harvests (i.e., Bulk Drug Substance Runs resulting in vialed and
     released Drug Product within customary timeframes after each harvest) by
     [*].

     (a)  Bulk Drug Substance Cost.  The cost of Bulk Drug Substance shall be
          fixed at DM [*]/gram, except for (1) Bulk Drug Substance that is [*]
          priced at DM [*]/gram under Section 24.1(c) above, (2) the potential
          annual price adjustments resulting from the [*] yield sharing between
          BIP and Buyer beginning [*] as described in Section 24.2(b) below and
          (3) the price adjustments permitted under Sections 5.6(a), 5.6(b) and
          5.6(c) hereof.

     (b)  Yield Enhancement.  BIP and Buyer shall share the benefit of all
          accrued yield increases from production of Bulk Drug Substance Lots on
          a [*] basis (i.e., accrued yield increases shall be measured from the
          Production Assumptions that were in effect on the Effective Date of
          the Agreement through the Production Assumptions calculated with
          respect to production through [*]), to be computed annually pursuant
          to Section 5.3(b) hereof beginning with the first potential annual
          price adjustment effective [*], provided, however, that the formula
          and example set forth in Section 5.3(b) hereof shall be adjusted to
          reflect such [*] sharing of any price adjustments.

     (c)  Risk Sharing.  Beginning with respect to Calendar Year [*], BIP and
          Buyer

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                                       10
<PAGE>

          shall each Calendar Year share on a [*] basis the costs of Bulk Drug
          Substance Runs that do not meet the Bulk Drug Substance Specifications
          (calculated on the basis of the Product Price and original Production
          Assumptions hereunder less [*]% for profit), but only to the extent
          that those failed Bulk Drug Substance Runs represent a failure rate
          greater than [*] percent ([*]%) of all the Bulk Drug Substance Runs
          performed during that Calendar Year [*]. Buyer's payment obligations
          for such Bulk Drug Substance Runs as set forth above shall only apply
          to the extent that a Bulk Drug Substance Run failed at the [*] in the
          Process. BIP shall accept the risk of the first [*] percent ([*]%) of
          Bulk Drug Substance Runs each Calendar Year that fail at the [*] in
          the Process. Buyer's payment obligations under this Section 24.2(c)
          shall be deemed to satisfy any payment obligations of Buyer under the
          provisions of Section 6.3 hereof to the extent any such provisions
          could be construed to require Buyer to pay any portion of the cost of
          Bulk Drug Substance Runs that do not meet the Bulk Drug Substance
          Specifications.

24.3 Contractual Incentives for Successful Outsourcing Activities.  Instead of,
     and not in addition to, the contractual incentives and other terms provided
     to BIP in Section 24.2 above for Unsuccessful Outsourcing Activities, BIP
     shall receive the following contractual incentives and be subject to the
     following terms set forth in this Section 24.3 in the event that BIP's
     efforts have resulted in Successful Outsourcing Activities, except as
     otherwise set forth in Section 24.3(e) below.  For purposes hereof,
     "Successful Outsourcing Activities" shall mean that as a result of BIP's
     Outsourcing Activities, BIP has achieved at least [*] successful harvests
     (i.e., Bulk Drug Substance Runs resulting in vialed and released Drug
     Product within customary timeframes after each harvest) by [*]:

     (a)  Bulk Drug Substance Cost.  The cost of Bulk Drug Substance shall be
          fixed at DM [*]/gram, except for (1) Bulk Drug Substance that is [*]
          priced at DM [*]/gram under Section 24.1(c) above, (2) the potential
          annual price adjustments resulting from the [*] yield sharing between
          BIP and Buyer [*] as described in Section 24.3(b) below and (3) the
          price adjustments permitted under Sections 5.6(a), 5.6(b) and 5.6(c)
          hereof.

     (b)  Yield Enhancement.  BIP shall [*].  Thereafter, BIP and Buyer shall
          share the benefit of all accrued yield increases from production of
          Bulk Drug Substance Lots on a [*] basis (i.e., accrued yield increases
          shall be measured from the Production Assumptions that were in effect
          on the Effective Date of the Agreement through the Production
          Assumptions calculated with respect to production through [*]), to be
          computed annually pursuant to Section 5.3(b) hereof beginning with the
          first potential annual price

[*] Confidential Treatment Requested

                                       11
<PAGE>

          adjustment effective [*], provided, however, that the formula and
          example set forth in Section 5.3(b) hereof shall be adjusted to
          reflect such [*] sharing of any price adjustments.

     (c)  Risk Sharing.  Beginning with respect to Calendar Year [*] and
          continuing with Calendar Years [*], BIP shall accept [*] percent
          ([*]%) of the risk that Bulk Drug Substance Runs do not meet the Bulk
          Drug Substance Specifications. In Calendar Year [*] and then beginning
          again with respect to Calendar Year [*] and thereafter for subsequent
          Calendar Years through the end of the Supply Term, BIP and Buyer shall
          each Calendar Year share on a [*] basis the costs of Bulk Drug
          Substance Runs that do not meet the Bulk Drug Substance Specifications
          (calculated on the basis of the Product Price and original Production
          Assumptions hereunder less [*]% for profit), but only to the extent
          that those failed Bulk Drug Substance Runs represent a failure rate
          greater than [*] percent ([*]%) of all the Bulk Drug Substance Runs
          performed during that Calendar Year. Buyer's payment obligations for
          such Bulk Drug Substance Runs as set forth above shall only apply to
          the extent that a Bulk Drug Substance Run failed at the [*] in the
          Process. BIP shall accept the risk of the first [*] percent ([*]%) of
          Bulk Drug Substance Runs each Calendar Year that fail at the [*] in
          the Process. Buyer's payment obligations under this Section 24.3(c)
          shall be deemed to satisfy any payment obligations of Buyer under the
          provisions of Section 6.3 hereof to the extent any such provisions
          could be construed to require Buyer to pay any portion of the cost of
          Bulk Drug Substance Runs that do not meet the Bulk Drug Substance
          Specifications.

     (d)  Reconciliation.  While the Parties will not know if BIP has achieved
          Successful Outsourcing Activities until [*], the yield enhancement
          provisions under Section 24.2(b) above contemplate shared savings from
          yield enhancements beginning on [*].  Therefore, if BIP has achieved
          Successful Outsourcing Activities, then within a reasonable time after
          [*], the Parties shall reconcile any shared savings during the first
          [*] months of [*] with the applicable yield enhancement provisions
          under Section 24.3(b) above.

     (e)  Reversion to Terms in Section 24.2.  If BIP either provides written
          notice to Buyer under Section 24.1(d) above that BIP will not make
          available at least [*] Subsequent Additional Runs in [*] or [*], or if
          BIP in fact does not attempt at least [*] Subsequent Additional Runs
          in [*] or [*], then from [*] of either [*] or [*], as the case may be
          depending on which is the first Calendar Year for which BIP provides
          notice that it will not make available at least [*] Subsequent
          Additional Runs or does not in fact attempt such [*] Subsequent
          Additional Runs, and through the remainder of the Supply Term, the
          terms and conditions in Section 24.3(a) - (c) applicable to Successful
          Outsourcing Activities shall

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                                       12
<PAGE>

          revert to and be superseded by the terms and conditions in Section
          24.2(a) - (c) applicable to Unsuccessful Outsourcing Activities,
          provided, however, that upon such reversion, in no event shall (1) BIP
          have any obligation to refund to Buyer any benefits which had accrued
          to BIP from yield enhancement in earlier Calendar Years under Section
          24.3(b) above, or (2) Buyer have any additional obligation to BIP for
          risk sharing costs in earlier Calendar Years under Section 24.2(c)
          above.

     7.   Rhode Island Manufacturing Facility. BIP shall provide the assistance
to Immunex and Wyeth in the transfer of technology related to manufacture of the
Product to Wyeth's manufacturing facility in West Greenwich, Rhode Island in a
separate agreement of even date herewith, in which the Parties have agreed upon
the requested activities, timelines, manpower and financial terms.

     8.   Effect of Amendment No. 1 on Agreement. Except as otherwise set forth
in this Amendment No. 1, all other terms and provisions of the Agreement shall
remain in full force and effect. In the event of any conflict between the terms
and conditions of the Agreement and the terms and conditions of this Amendment
No. 1, the terms and conditions of this Amendment No. 1 shall control.

     9.   Counterparts. This Amendment No. 1 may be executed in counterparts,
each of which shall be deemed an original and all of which shall constitute
together one and the same instrument.

     IN WITNESS WHEREOF, the Parties have, by their duly authorized persons,
executed this Amendment No. 1 as of the Amendment Effective Date.

IMMUNEX CORPORATION                 AMERICAN HOME PRODUCTS
                                    CORPORATION, acting through its
                                    Wyeth-Ayerst Laboratories division

By: /s/ Peggy V. Phillips             By: /s/ Kenneth J. Martin
   -------------------------------       ---------------------------------

Name: Peggy V. Phillips               Name: Kenneth J. Martin
     -----------------------------         -------------------------------

Title: Executive VP & COO             Title: Sr. Vice President & Chief
      ----------------------------          ------------------------------
                                             Financial Officer
                                            ------------------------------

Date:  6/27/00                        Date: 6/27/00
     -----------------------------         -------------------------------

BOEHRINGER INGELHEIM PHARMA KG
ppa.                                  ppa.

By: /s/ Wolfram Carius                By: /s/ Rolf Werner
   -------------------------------       ---------------------------------

Name: Wolfram Carius                  Name: Rolf Werner
     -----------------------------         -------------------------------

Title: Head of Aidpharm Manuf.        Title: CD Biopharmaceuticals
      ----------------------------          ------------------------------

Date: 30.06.00                        Date: 30.06.00
     -----------------------------         -------------------------------

                                       13

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