Document:

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                                                                    EXHIBIT 10.2

                                            ***TEXT OMITTED AND FILED SEPARATELY
                                                CONFIDENTIAL TREATMENT REQUESTED
                                          UNDER 17 C.F.R. SECTIONS 200.80(b)(4),
                                                            200.83 AND 240.24b-2

                           U.S. CO-PROMOTION AGREEMENT

                                 BY AND BETWEEN

                          AMYLIN PHARMACEUTICALS, INC.

                                       AND

                              ELI LILLY AND COMPANY

                                 EFFECTIVE AS OF

                               SEPTEMBER 19, 2002

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                           U.S. CO-PROMOTION AGREEMENT

This U.S. Co-Promotion Agreement (the "Agreement") is made effective as of the
19th day of September, 2002 (the "Effective Date") by and between Amylin
Pharmaceuticals, Inc. ("Amylin"), a Delaware corporation having its principal
place of business at 9373 Towne Center Drive, Suite 250, San Diego, California,
92121,

                                       and

Eli Lilly and Company, an Indiana corporation having its principal place of
business at Lilly Corporate Center, Indianapolis, Indiana, 46285 ("Lilly").

                                    RECITALS

        1. Amylin is developing Product for the prevention and treatment of
diabetes and obesity and potentially other indications. Pursuant to the terms of
a Collaboration Agreement of even date herewith, Lilly and Amylin have agreed to
cooperate in the development and marketing of Product.

        2. In furtherance of the goals of the Collaboration Agreement, the
parties desire to enter into this agreement for the Co-Promotion of Product in
the United States.

        NOW THEREFORE, in consideration of the foregoing premises and the mutual
covenants contained in this Agreement, the Parties agree as follows:

                                    ARTICLE I

                                   DEFINITIONS

As used herein, the following terms shall have the meanings indicated:

 "ADDITIONAL INDICATION" shall have the meaning provided in the Collaboration
Agreement.

"ADVERSE EVENT" OR "ADVERSE EXPERIENCE" shall have the meaning provided in the
Collaboration Agreement.

"ADVERSE EVENT REPORT" shall have the meaning provided in the Collaboration
Agreement.

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"AFFILIATE" shall have the meaning provided in the Collaboration Agreement.

"AMYLIN DETAIL PERCENTAGE" shall mean the percentage of total Product Details to
be delivered by Amylin in the Co-Promotion Territory, as determined from time to
time by the JCC.

"AMYLIN MARK" shall have the meaning set forth in the Collaboration Agreement.

"AMYLIN SALES FORCE" has the meaning set forth in Section 2.2.

"ALTERNATE DELIVERY" shall have the meaning provided in the Collaboration
Agreement.

"APPLICABLE LAWS" shall have the meaning provided in the Collaboration
Agreement.

"COLLABORATION AGREEMENT" means the Collaboration Agreement between the Parties
of even date herewith, as the same may be amended from time to time by the
Parties.

"COMMERCIALIZATION PLAN" shall have the meaning provided in the Collaboration
Agreement.

"COMMERCIALLY REASONABLE EFFORTS" shall have the meaning provided in the
Collaboration Agreement.

"CO-PROMOTE" OR "CO-PROMOTION" means an arrangement between Amylin and Lilly in
which unless otherwise agreed by the Parties: (i) Amylin is the registration
holder for the Product; (ii) Amylin makes all decisions regarding pricing of the
Product (iii) Amylin Manufactures or has Manufactured for it all Product sold
(iv) Amylin makes and records all sales of Product; (v) Amylin distributes all
Product by utilizing the agreed upon channels of distribution (vi) a single
trademark is used in connection with the Product; (vii) both Parties promote and
market the Product; and (viii) both names or logos of the Parties appear on the
Product (to the extent permitted by Applicable Law).

"CO-PROMOTION TERRITORY" means the fifty (50) states of the United States of
America, the District of Columbia and any territory, possession, or protectorate
of the United States of America.

"CSO" means a contract sales organization in the business of providing sales
Details for pharmaceutical products.

"DETAILS" means a Primary Detail and/or a Secondary Detail.

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"EFFECTIVE DATE" means the date this Agreement was entered into as stated in the
first paragraph of this Agreement.

"FDA" shall have the meaning provided in the Collaboration Agreement.

"FIRST PRIORITY PRODUCT" means a pharmaceutical product for which a sales
representative is expected to present the uses and benefits as the first product
discussed in each of his or her face-to-face meetings with health care
professionals during which he or she presents the uses and benefits of
pharmaceutical products.

"GOVERNMENTAL AUTHORITY" shall have the meaning provided in the Collaboration
Agreement.

"INDICATION" shall have the meaning provided in the Collaboration Agreement.

"JOINT COMMERCIALIZATION COMMITTEE" OR "JCC" shall have the meaning provided in
the Collaboration Agreement.

"LILLY DETAIL PERCENTAGE" shall mean the percentage of total Product Details to
be delivered by Lilly in the Co-Promotion Territory, as determined from time to
time by the JCC.

"LILLY GOOD PROMOTIONAL PRACTICE GUIDELINES" means the proprietary guidelines
adopted from time to time by Lilly, based on its understanding of Applicable
Laws, regarding the promotion of a pharmaceutical products in the Co-Promotion
Territory.

"LILLY MARK" shall have the meaning set forth in the Collaboration Agreement.

"MANUFACTURE" OR "MANUFACTURING" OR "MANUFACTURED" shall have the meaning
provided in the Collaboration Agreement.

"MARKETING APPROVAL" shall have the meaning provided in the Collaboration
Agreement, but for purposes of this Agreement shall relate only to the
Co-Promotion Territory.

"NDA" shall have the meaning provided in the Collaboration Agreement.

"PARTY OR PARTIES" shall have the meaning provided in the Collaboration
Agreement.

"PRIMARY DETAILS" means promotion of Product to medical professionals by a sales
representative with the product presentation occurring as the First Priority
Product or Second Priority Product.

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"PRODUCT" shall have the meaning provided in the Collaboration Agreement.

"PRODUCT COMPLAINT" shall have the meaning provided in the Collaboration
Agreement.

"PRODUCT LAUNCH" shall have the meaning provided in the Collaboration Agreement.

"PROMOTION RELATED ACTIVITIES" means lunches, snacks, dinners, entertainment, or
medically related gifts for health care professionals with prescribing authority
used to promote Product to such persons. For purposes of this Agreement,
Promotion Related Activities expressly excludes conference or convention
participation, continuing medical education programs, grants, paid speaker
programs, symposiums and entertainment.

"PROMOTIONAL MATERIALS" shall have the meaning provided in the Collaboration
Agreement.

"PROMOTIONAL PLAN" shall mean an annual strategic plan for the Co-Promotion of
the Product by Amylin and Lilly in the Co-Promotion Territory developed by the
JCC as part of the Commercialization Plan.

"REGULATORY MATERIALS" shall have the meaning provided in the Collaboration
Agreement.

"RELATED AGREEMENTS" shall have the meaning provided in the Collaboration
Agreement.

"SAMPLES" mean quantities of Product given to authorized medical professionals
for no or minimal consideration as part of the marketing, advertising and
promotion of the Product.

"SECOND PRIORITY PRODUCT" means the second priority pharmaceutical product for
which a sales representative is expected to present the uses and benefits after
presenting the First Priority Product in his or her face-to-face meetings with
health care professionals during which he or she presents the uses and benefits
of pharmaceutical products.

"SECONDARY DETAILS" means promotion of Product to medical professionals by a
sales representative that is not a Primary Detail.

"STEERING COMMITTEE" or "JSC" shall have the meaning set forth in the
Collaboration Agreement.

"TARGETED PHYSICIANS" means those categories of health care professionals with
prescribing authority selected from time to time by the JCC as professionals

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to which Primary Details are to be delivered by Amylin and/or Lilly sales
representatives.

"THIRD PERSON" shall have the meaning provided in the Collaboration Agreement.

"TRAINING MATERIALS" means the items the JCC develops after the Effective Date
to train persons to promote Product in the Co-Promotion Territory.

                                   ARTICLE II

                          CO-PROMOTION AND SALES FORCES

2.1 PRODUCT PROMOTION.

Upon the terms and conditions set forth in this Agreement, Amylin hereby grants
Lilly during the term of this Agreement the co-exclusive right with Amylin to
promote and detail Product in the Co-Promotion Territory in accordance with the
terms of this Agreement. The principal objective of the Parties hereunder is to
maximize the commercialization of the Product in the Co-Promotion Territory.
Following receipt of Marketing Approval in the Co-Promotion Territory, the
Parties shall each use their Commercially Reasonable Efforts to promote Product
in the Co-Promotion Territory and to fulfill their obligations under this
Agreement. The Parties shall deploy each of their respective sales forces in an
effort to promote the Product in the Co-Promotion Territory in accordance with
the Commercialization Plan in effect from time to time, the directions of the
JCC, and the terms of this Agreement. Prior to Product Launch, and thereafter or
an annual basis, the JCC shall agree upon (i) the number of Details needed for
the following year, (ii) the number of Details that must be made as First
Priority Product, Second Priority Product or as a Secondary Detail, (iii) the
Amylin Detail Percentage and the Lilly Detail Percentage, and (iv) the size of
each party's Sales Force and Detail Position necessary to permit each party to
fulfill its obligations under this Agreement. Notwithstanding the foregoing,
unless the Parties agree otherwise, each Party will [...***...] to the promotion
of the product.

2.2 AMYLIN SALES FORCE.

Amylin will establish a sales force of sales representatives responsible for
Co-Promoting Product in the Co-Promotion Territory with Lilly (the "Amylin Sales
Force") under this Agreement.

        (a) Qualifications for Members of the Amylin Sales Force. Amylin will be
solely responsible for recruiting, hiring and maintaining the Amylin Sales Force

                                               *CONFIDENTIAL TREATMENT REQUESTED

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in accordance with its standard procedures and the guidelines, if any, developed
by the JCC.

        (b) Number of Sales Representatives. Amylin will be responsible for
providing the Amylin Detail Percentage of the Details determined by the JCC to
be needed to promote Product in the Co-Promotion Territory, and Amylin's Sales
Force will detail Product in the Co-Promotion Territory to Targeted Physicians
in accordance with the Promotion Plan and the strategies established by the JCC.

        (c) Training. The JCC shall establish procedures for sales training and
for preparation of Training Materials related to Product. Amylin will be
responsible for general sales training of its sales representatives and will
implement Product related sales training in accordance with the procedures
established by the JCC.

        (d) CSOs. Amylin may not employ a CSO to fulfill any of its product
detail obligations in the Co-Promotion Territory without the prior consent of
Lilly, not to be unreasonably withheld. In any event, Amylin may only use a CSO
to fulfill some of its Product detail obligations in the Co-Promotion Territory
if such CSO is reputable and Amylin can demonstrate to Lilly that such CSO has
been integrated into Amylin's sales force and business practices in the
Co-Promotion Territory.

2.3 LILLY SALES FORCE.

Lilly will establish or designate a sales force of sales representatives,
responsible for Co-Promoting Product in the Co-Promotion Territory with Amylin
(the "Lilly Sales Force") under this Agreement.

        (a) Qualifications for Members of the Lilly Sales Force. Lilly will be
solely responsible for recruiting hiring and/or maintaining the Lilly Sales
Force in accordance with its standard procedures and the guidelines, if any,
developed by the JCC.

        (b) Number of Sales Representatives. Lilly will be responsible for
providing the Lilly Detail Percentage of the Details determined by the JCC to be
needed to promote Product in the Co-Promotion Territory, and Lilly's Sales Force
will detail Product in the Co-Promotion Territory to Targeted Physicians in
accordance with the Promotion Plan and the strategies established by the JCC.

        (c) Training. The JCC shall establish procedures for sales training and
for preparation of Training Materials related to Product. Lilly will be
responsible for general sales training of its sales representatives and will
implement Product related sales training in accordance with the procedures
established by the JCC.

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        (d) CSOs. Lilly may not employ a CSO to fulfill any of its Product
detail obligations in the Co-Promotion Territory without the consent of Amylin,
not to be unreasonably with held. In any event Lilly may only use a CSO to
fulfill Product detail obligations in the Co-Promotion Territory if such CSO is
reputable and Lilly can demonstrate to Amylin that such CSO has been integrated
into Lilly's sales force and business practice in the Co-Promotion Territory.

2.4 ALIGNMENT OF AMYLIN'S SALES TERRITORIES AND SALES DISTRICTS.

        (a) Sales Territories. The sales territories, sales districts, and sales
regions for the Amylin Sales Force shall to the extent practicable be
geographically aligned with Lilly's sales territories, sales districts and sales
regions for Product in the Co-Promotion Territory at Product Launch. If Lilly
changes its territories, sales districts or sales regions after Launch, Amylin
shall in good faith consider the advantages of alignment with Lilly's Sales
Force, but shall not be obligated to make any change. Amylin's Sales Force shall
include representatives for each state, territory, possession and protectorate
within the Co-Promotion Territory.

        (b) Compensation. Each Party will use its Commercially Reasonable
Efforts to ensure that variable pay components of its compensation structure,
including but not limited to incentives, for its sales force with responsibility
for promoting Product are consistent with the detail position the Parties' have
agreed upon for Product with such sales force. To facilitate the determination
of the incentives, the JCC will work with the Parties to coordinate annual sales
plans.

        2.5. TRACKING OF DETAILS. [...***...] The JCC shall establish reasonable
procedures for monitoring of sales force activities to ensure that each Party is
complying with its obligations under this Agreement, and each Party agrees to
make available to the other such information as may reasonably be required in
order for the other Party to monitor compliance with this Agreement. As provided
in Section 2.1, the JCC shall annually agree upon the size of the Amylin and
Lilly sales forces and Detail position necessary to permit Amylin to fulfill its
obligation to provide the Amylin Detail Percentage and Lilly its obligation to
provide the Lilly Detail Percentage.

        2.6 RESPONSIBILITY FOR THE SALES FORCE. In implementing the obligations
contained in this Agreement, each Party shall have sole discretion as to the
manner (which shall not be inconsistent with the Commercialization Plan, and
provided that neither Party will utilize any Promotional Materials not approved
by

                                               *CONFIDENTIAL TREATMENT REQUESTED

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the JCC) in which it promotes and Details (including any expenditure of funds in
connection therewith) the Product in the Co-Promotion Territory.

Neither party shall distribute or have distributed any information that bears
the name or logo of the other Party without the prior approval of the other
through the Steering Committee or the JCC, which approval shall not be
unreasonably withheld.

Each Party shall have sole authority and responsibility for recruiting, hiring,
training, managing, compensating, subject to Section 2.4(b) (including paying
for all benefits, wages, special incentives, workers' compensation, and
employment taxes), disciplining, firing, and otherwise controlling the persons
comprising its sales force and for paying for any and all costs associated with
its sales force's efforts under the Agreement. Each Party will provide the
day-to-day management of its sales force, including, without limitation,
furnishing administrative support, financial resources, equipment, and supplies,
monitoring detail reporting and Sample accounting; and assuring the Sales
Force's understanding and compliance with this Agreement and Applicable Laws.

                                  ARTICLE III

                       COMMERCIALIZATION RESPONSIBILITIES

3.1 COMMERCIALIZATION EFFORTS

        (a) Commercialization Plan

The JCC will develop a promotional detailing plan ("Promotional Plan") as part
of the Commercialization Plan. The Commercialization Plan (including the
Promotional Plan) will include, but not be limited to the following activities
and state the responsibilities of each Party with respect to the activity, and
the sharing of costs for each activity:

                (i)     Promotion Related Activities;

                (ii)    Medical plans (Phase 3 clinical trials and investigator
                        initiated studies);

                (iii)   Publications;

                (iv)    Journal and magazine advertisements; advertising
                        regulatory fees, media production;

                (v)     Health economics studies and activities;

                (vi)    Patient marketing activities (direct to consumer
                        advertising, patient education, direct patient
                        marketing, direct mail, web site development and
                        maintenance);

                (vii)   Market research;

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                (viii)  Product Launch meetings, training materials and
                        Promotional Materials;

                (ix)    Public relations and community relations related to
                        Product consultantships;

                (x)     Business to business programs such as setting up
                        programs with pharmacy benefit managers, wholesalers and
                        chain drug stores and other activities in managed care;

                (xi)    "Peer to Peer" activities such as continuing medical
                        education, speaker training, consultants, advisory
                        boards; and

                (xii)   Symposia, conferences, trade shows and conventions,
                        convention donations, convention exhibits, grants,
                        educational materials, compassionate use product,
                        indigent programs

        (b) Sales Force Activities. The Promotional Plan will set forth is
reasonable detail all material matters related to sales force activities. Each
Party will utilize its Commercially Reasonable Efforts consistent with its
customary business practices and Applicable Laws to deploy its sales force to
promote and detail the Product in the Co-Promotion Territory in accordance with
the Promotional Plan.

        (c) Managed Payors. The JCC will determine the authority of each Party,
if any, to detail or otherwise promote Product to any physicians or to any
contracting agents, medical directors, formulary decision makers, benefit
managers, or administrators (even if such persons are health care professionals
legally authorized to prescribe Product) of a managed care organization (e.g.,
health maintenance organization, prescription benefits manager, insurance
company, or similar entity), government-funded insurance or medical program, or
employer. Amylin shall be solely responsible for the pricing of Product and any
discounts, rebates or other deviations from the established price. All Product
promotion and contracting activities with managed care entities will be
conducted by the Party or Parties designated by the JCC.

        (d) Promotion Related Activities. As part of the efforts under this
Agreement, each Party, in accordance with the Commercialization Plan, may have
its Sales Force conduct Promotion Related Activities with the health care
professionals to whom it is required to detail Product, but only to the extent
such Promotion Related Activities are conducted in accordance with the Lilly
Good Promotional Practice Guidelines or the Amylin equivalent and the American
Medical Association's and PhRMA's related guidelines. Except pursuant to
procedures approved by the JCC, neither Party has authority independent of the
other Party, (i) to conduct any form of direct-to-consumer promotion related to
Product, (ii) to schedule or manage conference involvement pertaining to
Product, (iii) to establish or manage advisory boards and opinion leaders for
Product, (iv) to conduct or sponsor continuing medical education programs, paid

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speaker programs, or symposia related to Product, (v) provide grants; or (vi)
take any other action that the JCC determines will require its direction. All of
such matters will be conducted as provided by the Commercialization Plan.

        (e) Compliance. Each Party agrees that all activities under this
Agreement by it or on its behalf, including, but not limited to, training,
detailing, Promotional Activities, record-keeping, collection of consumer data
(if any), and sampling, will be done in compliance with the FDA-approved package
insert and labeling of Product, the applicable Promotional Materials, the Lilly
Good Promotional Practice Guidelines or the Amylin equivalent and all Applicable
Laws. Amylin has been provided a copy of the United States Federal Trade
Commission's Decision and Order for In the Matter of Eli Lilly and Company
(Docket No. C-4047) issued May 8, 2002, and relating to the protection of
patient identifiable information and agrees to cooperate with Lilly with respect
to such Decision and Order provided that Lilly shall have ultimate
responsibility for compliance.

        (f) Sales Force Issues. Should either Party identify a sales
representative or member of sales force management in the other Party's Sales
Force that the Party believes is damaging relationships with health care
professionals or damaging the Product brand, such Party shall promptly notify
the other Party in writing of such belief and the basis therefore. Following
such notification, the Parties shall meet to discuss such belief and basis. The
Party, in response to the other Party's concerns about such individual, shall
take such action as it deems reasonable in the situation.

3.2 DISTRIBUTION OF SAMPLES OF PRODUCT.

        (a) Rights. As part of the efforts under this Agreement, each Party's
Sales Force will distribute Samples of Product to the health care professionals
to whom it Details Product. The JCC will develop appropriate procedures for
delivery of Samples and Sample accountability. Amylin will supply, and Lilly
will obtain, all such Samples from Amylin. The quantity and type of Product
Samples to be distributed by the Parties' Sales Forces will be part of the
Commercialization Plan. Each Party shall use Samples strictly in accordance with
the then current Commercial Plan and shall distribute Samples in full compliance
with all Applicable Laws.

        (b) Sample Forecasts, Purchase Orders, and Delivery. The JCC will
establish a procedure for forecasting Sample needs, ordering, and delivery of
Samples.

        (c) Allocations. In the event in any month there is shortage of Samples,
unless otherwise agreed by the Parties, available samples will be allocated in
accordance with each Party's share of the detailing responsibility.

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        (d) Lilly's Responsibilities for Samples. Lilly shall be solely
responsible for the transport, storage, handling, and distribution (both to the
Lilly Sales Force and to the health care professionals) of the Product Samples
it obtains under this Section. Lilly will transport, store, handle, and
distribute all Samples in compliance with all Applicable Laws and with the
procedures established by the JCC.

        (e) Amylin's Responsibilities for Samples. Amylin shall be solely
responsible for the transport, storage, handling, and distribution (both to the
Amylin Sales Force and to the health care professionals) of the Product Samples
it distributes. Amylin will transport, store, handle, and distribute all Samples
in compliance with all Applicable Laws and with the procedures established by
the JCC.

3.3 USE AND DISTRIBUTION OF PROMOTIONAL MATERIALS.

        (a) Promotional Materials. All Promotional Materials will be developed,
produced and provided to and utilized by the Parties in accordance with the
directions of the JCC. Promotional Materials will be reviewed and approved
before use by a Medical/Regulatory/Legal Team created by the JCC.

        (b) Lilly's Use and Distribution of Promotional Material. As part of its
efforts under this Agreement, the Lilly Sales Force will use and, as applicable,
distribute Promotional Materials to the health care professionals to whom it
Details Product in accordance with the Commercialization Plan. The Promotional
Materials will be used by Lilly only for purposes of this Agreement. Lilly will
obtain all Promotional Materials from the Party responsible for obtaining
Promotional Materials pursuant to the Commercialization Plan in the quantity and
of the type required by the Commercialization Plan. Lilly agrees that it will
not create any Promotional Materials except as authorized by the JCC. Lilly also
agrees that it will not copy or alter in any manner (including rearranging,
underlining, highlighting, recording notes, etc.) the Promotional Materials nor
will it allow its Sales Force to use any such unauthorized, copied, or altered
Promotional Materials.

        (c) Amylin Use and Distribution of Promotional Materials. As part of its
efforts under this Agreement, the Amylin Sales Force will use and, as
applicable, distribute Promotional Materials to the health care professionals to
whom it Details Product in accordance with the Commercialization Plan. The
Promotional Materials will be used by Amylin only for purposes of this
Agreement. Amylin will obtain all Promotional Materials from the Party
responsible for obtaining Promotional Materials pursuant to the
Commercialization Plan in the quantity and of the type required by the
Commercialization Plan Amylin agrees that it will not create any Promotional
Materials except as authorized by the JCC. Amylin also agrees that it will not
copy or alter in any manner (including rearranging, underlining, highlighting,

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recording notes, etc.) the Promotional Materials nor will it allow its Sales
Force to use any such unauthorized, copied, or altered Promotional Materials.

        (d) Order and Delivery Procedures. The JCC will establish a procedure
for forecasting Promotional Material needs, ordering, and delivery of
Promotional Materials.

        (e) Allocation. If the Party responsible for supplying Promotional
Materials does not have a sufficient supply in inventory to satisfy requests for
any Promotional Materials, unless otherwise agreed by the Parties, the available
supply will be allocated in accordance with each Party's share of the detailing
responsibility.

3.4 DISCONTINUATION OF MATERIALS AND SAMPLES.

If the Party responsible for Training Material, Promotional Material or Samples
informs the JCC in writing that a Training Material, Promotional Material, or
Sample may no longer be used or distributed, each Party agrees that it will not
allow its Sales Force to use or distribute such Training Material, Promotional
Material, or Sample after the no-use date identified by the responsible Party in
its notice.

3.5 DISCRETION REGARDING STRATEGY FOR SALES FORCE.

        (a) Lilly Responsibilities. Lilly will employ the strategies developed
by the JCC and set forth in the Promotional Plan regarding Product sampling,
Promotional Materials, and Promotion Related Activities for the Lilly Sales
Force, but Lilly agrees that all activities under this Agreement by it or on its
behalf, including, but not limited to, training, detailing, Promotion Related
Activities, record-keeping, and sampling, will be done in compliance with the
FDA-approved package insert and labeling of Product, all Applicable Laws, the
Lilly Good Promotional Practice Guidelines and applicable PhRMA marketing
practices guidelines.

Lilly covenants that it will not promote Product for any use not approved by the
FDA. Lilly also covenants that it will not knowingly make any false or
misleading representation to any health care professional or others regarding
Product and that it will not make, except as contained in the Promotional
Materials and the product's package insert and labeling, any representation,
warranty, or guarantee with respect to the specifications, features, or
capabilities of Product.

        (b) Amylin Responsibilities. Amylin will employ the strategies developed
by the JCC and set forth in the Promotional Plan regarding Product sampling,
Promotional Materials, and Promotion Related Activities for the Amylin Sales
Force, but Amylin agrees that all activities under this Agreement by it or on
its behalf, including, but not limited to, training, detailing, Promotion
Related

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Activities, record-keeping, and sampling, will be done in compliance with the
FDA-approved package insert and labeling of Product, all Applicable Laws, the
Lilly Good Promotional Practice Guidelines or Amylin equivalent, and applicable
PhRMA marketing practices guidelines.

Amylin covenants that it will not promote Product for any use not approved by
the FDA. Amylin also covenants that it will not knowingly make any false or
misleading representation to any health care professional or others regarding
Product and that it will not make, except as contained in the Promotional
Materials and the product's package insert and labeling, any representation,
warranty, or guarantee with respect to the specifications, features, or
capabilities of Product.

3.6 SALES FORCE MEETINGS.

The JCC will work together to coordinate the timing of sales force meetings and
to determine whether and when sales force meetings regarding Product should be
jointly or separately held by the Parties.

3.7 PROMOTION OF OTHER PRODUCTS.

While this Agreement is in effect, each Party has the right to have its Product
sales force detail other products in any detail positions not reserved by the
Parties for Product.

3.8 INFORMATION TECHNOLOGY FRAMEWORK.

To ensure efficient, timely and accurate communication of data and information
between the Parties regarding activities under the Agreement, each Party, at its
cost and on a time frame to be agreed upon by the Parties, will have in place
and maintain an appropriate information technology infrastructure that includes
a sales force automation tool, knowledge management tool, secure connectivity
for sharing Sample and call activity, call notes, voice mail and e-mail and the
use of which, as contemplated by the Parties under this Agreement, will not
infringe or violate a Third Person's intellectual property or privacy rights.
The Parties agree to work in good faith to create and implement processes and
technological mechanisms to prevent the disclosure between the Amylin Sales
Force and Lilly's sales forces of call notes and similar information, regarding
Amylin or Lilly promoted products other than the Product.

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3.9 INSURANCE COVERAGE.

Each Party will maintain, at its own expense, insurance coverage on its
activities under this Agreement. Such insurance will be maintained with a
reputable insurance carrier(s), and will include, without limitation, errors and
omissions insurance and comprehensive general liability insurance for claims for
damages arising from bodily injury (including death) and property damages
arising out of acts or omissions of the Party under this Agreement. Such
insurance will also be written on a per occurrence basis, except that the
Party's comprehensive general liability and directors and officers liability
insurance may be on a claims-made basis. In addition, such insurance will
provide that the insurer will notify each Party at least thirty (30) days in
advance of any cancellation or modification of such insurance coverage.
Maintenance of such insurance coverage will not relieve either Party of any
responsibility under this Agreement for damage in excess of insurance limits or
otherwise. Upon a Party's written request, the other Party will promptly provide
it with a certificate from the insurer(s) evidencing such insurance coverage.
Each Party will also maintain, at its expense, workers' compensation and
employer's insurance for its Sales Force.

3.10 TRADEMARKS AND LOGOS.

Trademarks and logos used in connection with Product shall be governed by the
terms of the Collaboration Agreement.

3.11 MARKET INFORMATION.

Each Party will provide the other with all information that the disclosing party
deems significant and relevant to the detailing and promotion of the Product
within a reasonable time after such information becomes known to the party,
provided such information is not received under a secrecy obligation.

3.12 USE OF AFFILIATES.

A Party may sublicense or subcontract its rights or obligations under this
Agreement only with the approval of the Parties, not to be unreasonably
withheld, except that a Party may sublicense or subcontract to the extent
permitted under Section 9.2 of the Collaboration Agreement and may subcontract
its obligations under this Agreement to an Affiliate (but only for so long as
such person or entity remains an Affiliate). However, the Party is solely
responsible for the performance of its obligations under the Agreement whether
performed by itself or by others, including an Affiliate, and even if a Party
uses an Affiliate to assist it in performing any of its obligations under the
Agreement, the other Party will continue to look exclusively to that Party for
performance of such obligation.

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                                   ARTICLE IV

                                  PRODUCT SALES

Amylin will make and record all sales of Product in the Co-Promotion Territory.
Amylin will manufacture, or have manufactured, Product and supply it to the
market in the Co-Promotion Territory. Amylin will maintain all responsibility
for returns, charge-backs, and rebates on such sales, and solely control
distribution (except sampling by the Lilly Sales Force) and pricing of Product
in the Co-Promotion Territory. Amylin, through its wholesalers and distribution
system, shall have in the Co-Promotion Territory the sole right to (1) receive,
accept and fill orders for Product, (2) distribute the Product to customers, (3)
control invoicing, order processing and collection of accounts receivable for
Product sales, and (4) record Product sales in its books of account. Amylin
shall determine, and the Commercial Plan shall include, commercial terms and
conditions with respect to the sale and distribution of Product, including
matters such as the price at which the Product shall be sold and whether any
discounts, rebates or other deductions should be made, paid or allowed. Amylin
shall arrange and be solely responsible for shipment, distribution and delivery
of the Product.

        (a) Misdirected Orders. If, for any reason, Lilly receives orders for
Product, Lilly shall forward such orders to Amylin (or if directed by Amylin to
Amylin's wholesalers) as soon as practicable.

        (b) Product Returns. If any quantities of the Product are returned to
Lilly, Lilly shall immediately notify Amylin and ship them to the facility
designated by Amylin. Lilly, at its option, may advise the customer who made the
return that the Product should have been returned to Amylin, but shall take no
other actions with respect to the return without Amylin's consent. All returns
of Samples used by the Lilly Sales Force shall first be returned to Lilly and
Lilly shall then ship returned Samples to Amylin.

                                   ARTICLE V

                         GOVERNANCE OF THE RELATIONSHIP

Governance of the activities contemplated by this Agreement shall be effected
through the Steering Committee and Joint Commercialization Committee established
pursuant to and in accordance with the terms of the Collaboration Agreement.

                                       16
<PAGE>

                                   ARTICLE VI

                         OTHER INDICATIONS AND PRODUCTS

6.1 CO-PROMOTION FOR OTHER INDICATIONS.

If the Parties develop Compound for any Additional Indication as provided in the
Collaboration Agreement, the Parties' rights to, and responsibilities for, the
commercialization of such Additional Indication will be consistent with their
respective rights to, and responsibilities for promoting Product as set forth in
this Agreement. The JCC will establish the detail level, detail position,
promotion message, promotion materials and additional promotional matters for
each Additional Indication consistent with the terms of this Agreement.

6.2 ALTERNATE DELIVERY.

If the Parties develop Alternate Delivery for Product as provided in the
Collaboration Agreement, the Parties' rights to, and responsibilities for, the
commercialization of such Alternate Delivery Product will be consistent with the
respective rights to and responsibilities for promoting Product as set forth in
this Agreement. The JCC will establish the detail level, detail position,
promotion message, promotion materials and additional promotional matters for
each Alternate Delivery Product consistent with the terms of this Agreement.

                                   ARTICLE VII

                              FINANCIAL PROVISIONS

All matters related to the Parties' compensation for their respective services
hereunder and right to reimbursement for expenses and other financial matters
shall be as set forth in the Collaboration Agreement.

                                  ARTICLE VIII

                               REGULATORY MATTERS

8.1     REGULATORY COMPLIANCE.

The rights and obligations of the Parties with respect to regulatory matters
shall be as set forth in the Collaboration Agreement.

                                       17
<PAGE>

8.2 PRODUCT COMPLAINTS.

The JCC will establish appropriate procedures for handling and reporting of
product complaints.

8.3 MEDICAL INQUIRIES.

The JCC will establish appropriate procedures for dealing with medical
inquiries.

8.4 PRODUCT RECALL OR REMOVAL FROM THE MARKET IN THE CO-PROMOTION TERRITORY.

In the event that a governmental entity issues a request, directive, or order,
or the Parties determine in accordance with the Collaboration Agreement to
recall or remove from the market some or all of the Product distributed in the
Co-Promotion Territory, Lilly will cooperate with Amylin in conducting such
recall or market removal (and any subsequent investigation by Amylin into the
cause of the recall or market removal) to the extent such recall or market
removal involves Product Samples distributed by Lilly. Lilly will maintain, and
make available to Amylin, accountability and traceability records on all Product
Samples it purchases from Amylin so as to permit, if necessary, a recall, market
removal, or field correction of such Samples.

                                   ARTICLE IX

                                 CONFIDENTIALITY

9.1 OBLIGATIONS. Each Party agrees to hold in confidence the other Party's
Confidential Information in accordance with the terms of the Collaboration
Agreement.

9.2 DISCLOSURE OF THE TERMS OF THE AGREEMENT. Neither Party shall disclose the
terms of this Agreement or use the names of the other Party except to the extent
permitted under the terms of the Collaboration Agreement.

                                       18
<PAGE>

                                    ARTICLE X

                  REPRESENTATIONS, WARRANTIES, AND DISCLAIMERS

10.1 NO DEBARMENT UNDER THE GENERIC DRUG ENFORCEMENT ACT OF 1992.

Each Party represents and warrants to the other Party that it is not debarred
under the Generic Drug Enforcement Act of 1992 (the "GDE Act") and is in
compliance with the provisions of the GDE Act. Each Party also covenants that,
while this Agreement is in effect, it will comply with the GDE Act, will not
become debarred under the GDE Act, and will not use in connection with this
Agreement the services of any person or entity debarred under the GDE Act.
Finally, upon request by the other Party, a Party will certify its compliance
with the GDE Act and this Section in writing to such other Party. If, at any
time, a Party breaches a covenant under this Section, the breaching Party will
immediately notify the other Party of such fact.

10.2 PRODUCT SAMPLES.

At the time Amylin delivers Product Samples to Lilly's carrier as described in
Section 3.2, Amylin represents and warrants to Lilly that such Samples:

        (i)     comply in all material respects with the specifications in the
                NDA for Product,

        (ii)    comply in all material respects with the Federal Food, Drug, and
                Cosmetic Act (21 U.S.C. Section 301 et seq.) and regulations
                issued hereunder, both as amended from time to time ("FDCA"),

        (iii)   are not products that have been adulterated or misbranded within
                the meaning set forth in FDCA and any state or local law or
                regulation substantially similar to FDCA,

        (iv)    are products that may be introduced into interstate commerce,
                and

        (v)     have been manufactured, packaged, stored, and shipped in
                conformity with all applicable current good manufacturing
                practices.

10.3 TRAINING MATERIALS AND PROMOTIONAL MATERIALS.

No employee or representative of a Party shall have any authority to bind or
obligate the other Party to this Agreement for any sum or in any manner
whatsoever, or to create or impose any contractual or other liability on the
other Party without the other Party's authorized written approval. For all
purposes, and notwithstanding any other provisions of this Agreement to the
contrary, the legal

                                       19
<PAGE>

relationship under this Agreement of the Parties shall be that of independent
contractors. Each Party shall be responsible for ensuring that its Promotional
Activities under this Agreement are in full compliance with all Applicable Laws,
including without limitation applicable FDA regulations, and are consistent with
the Marketing Approval and package insert.

10.4 DISCLAIMER OF IMPLIED WARRANTIES.

EXCEPT AS EXPRESSLY PROVIDED IN THIS AGREEMENT, NEITHER PARTY MAKES ANY OTHER
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, EITHER IN FACT OR BY OPERATION
OF LAW, STATUTE, OR OTHERWISE, AND EACH PARTY SPECIFICALLY DISCLAIMS ANY AND ALL
IMPLIED OR STATUTORY WARRANTIES INCLUDING WARRANTIES OF MERCHANTABILITY, OF
FITNESS FOR A PARTICULAR PURPOSE, AND OF NON-INFRINGEMENT.

10.5 LIMITATION OF LIABILITY.

NEITHER PARTY WILL BE LIABLE TO THE OTHER PARTY FOR INDIRECT, INCIDENTAL,
CONSEQUENTIAL, OR SPECIAL DAMAGES INCLUDING, BUT NOT LIMITED TO, LOST PROFITS
ARISING FROM OR RELATING TO ANY BREACH OF THIS AGREEMENT, REGARDLESS OF ANY
NOTICE OF THE POSSIBILITY OF SUCH DAMAGES. HOWEVER, NOTHING IN THIS SECTION IS
INTENDED TO LIMIT OR RESTRICT THE INDEMNIFICATION RIGHTS OR OBLIGATIONS OF ANY
PARTY.

                                   ARTICLE XI

                              TERM AND TERMINATION

11.1 TERM.

Unless extended by the Parties or terminated earlier, this Agreement will be in
effect from the Effective Date until termination or expiration of the
Collaboration Agreement, at which time this Agreement shall be deemed
terminated.

                                       20
<PAGE>

                                   ARTICLE XII

                               GENERAL PROVISIONS

12.1 LEGAL COMPLIANCE.

Each Party will comply with all Applicable Laws in the performance of its
obligations or the exercise of its rights hereunder.

12.2 ASSIGNMENT.

This Agreement may be assigned only as provided in the Collaboration Agreement.

12.3 INDEPENDENT CONTRACTORS.

It is understood and agreed that the Parties are independent contractors and are
engaged in the operation of their own respective businesses, and neither Party
is to be considered the agent of the other Party for any purpose whatsoever.
Neither Party will have any authority to enter into any contracts or assume any
obligations for the other Party nor make any warranties or representations on
behalf of that other Party.

12.4 GOVERNING LAW. This Agreement and all amendments, modifications,
alterations, or supplements hereto, and the rights of the Parties hereunder,
will be construed under and governed by the laws of the state of New York
exclusive of its conflicts of laws principles.

12.5 ENTIRE AGREEMENT. This Agreement, including any exhibits or attachments
attached hereto and the Related Agreements constitutes the entire agreement
between Amylin and Lilly with respect to the subject matter hereof, and all
previous or other negotiations, representations and understandings with respect
to the subject matter hereof between Amylin and Lilly are superseded as of the
Effective Date. This Agreement has been prepared jointly and will not be
strictly construed against either Party.

12.6 SEVERABILITY. If a provision of this Agreement (or portion thereof) is held
to be illegal, invalid, or unenforceable by a court of competent jurisdiction,
the remaining provisions (and portions thereof) of the Agreement shall remain in
full force and effect. In addition, to the extent feasible and legally
permissible, the court of competent jurisdiction will replace the illegal,
invalid, or unenforceable provision of this Agreement with a valid provision
that eliminates such violation while conforming as closely as possible to the
original terms of this Agreement.

If a provision of this Agreement (or portion thereof) that is essential to the
commercial purpose of this Agreement is held to be illegal, invalid, or

                                       21
<PAGE>

unenforceable by a court of competent jurisdiction and such court cannot replace
(either because such replacement is not feasible or not legally permissible)
such provision with a valid provision that eliminates such violation while
conforming as closely as possible to the original terms of this Agreement, the
remaining provisions (and portions thereof) of the Agreement remain in full
force and effect, but either Party may terminate the Agreement upon written
notice to the other.

12.8 COUNTERPARTS. This Agreement may be executed in one or more counterparts,
each of which will be deemed an original, but all of which together will
constitute one and the same instrument.

12.9 NOTICES. All notices, statements, and reports required to be given under
this Agreement shall be given in the manner specified in the Collaboration
Agreement.

12.10 WAIVER. The failure of either Party to enforce any provision of this
Agreement at any time will not be construed as a present or future waiver of
such provision or any other provision of this Agreement.

12.11 MODIFICATIONS. No amendment, waiver or modification of this Agreement will
be valid or binding on either Party unless made in writing and signed by duly
authorized representatives of both Parties.

12.12 HEADINGS. All headings and captions used in this Agreement are for
convenience only, and are not intended to have any substantive effect.

12.13 NO OTHER LICENSES OR RIGHTS. Except as specifically provided for in this
Agreement, neither Party grants, expressed or implied, any license or rights to
the other Party.

12.14 FURTHER ACTIONS. Each Party agrees to execute, acknowledge, and deliver
such further instruments, and to do all other acts, as may be reasonably
necessary or appropriate within the contemplation of this Agreement to carry out
the purposes and intent of this Agreement.

                                       22
<PAGE>

IN WITNESS WHEREOF, each Party has executed this Agreement by its respective,
duly authorized officer as of the day and year herein written.

AMYLIN PHARMACEUTICALS, INC.            ELI LILLY AND COMPANY

By: /s/ JOSEPH C. COOK, JR.             By: /s/ AUGUST M. WATANABE
   ------------------------------          -------------------------------------

Name: Joseph C. Cook, Jr.               Name: August M. Watanabe
     ----------------------------            -----------------------------------

Title: Chairman and Chief               Title: Executive Vice President
       Executive Officer                       Science/Technology

                   [Signature Page -- Co-Promotion Agreement]

                                       23<PAGE>
                                                                    EXHIBIT 10.3

                                            ***TEXT OMITTED AND FILED SEPARATELY
                                                CONFIDENTIAL TREATMENT REQUESTED
                                          UNDER 17 C.F.R. SECTIONS 200.80(b)(4),
                                                            200.83 AND 240.24b-2

                                 LOAN AGREEMENT

                                     BETWEEN

                          AMYLIN PHARMACEUTICALS, INC.

                                       AND

                              ELI LILLY AND COMPANY

<PAGE>

<TABLE>
<S>                                                                                        <C>
SECTION 1.        DEFINITIONS...............................................................1

        1.1    Defined Terms................................................................1

        1.2    Accounting Terms.............................................................6

        1.3    Singular and Plural..........................................................6

        1.4    Elements of this Agreement...................................................7

SECTION 2.        AMOUNT AND TERMS OF CREDIT................................................7

        2.1    Commitment...................................................................7

        2.2    Requests for Advances........................................................7

        2.3    Development Advances.........................................................7

        2.4    Commercialization Advances...................................................8

        2.5    Disbursement of Advances.....................................................9

        2.6    Security for Obligations.....................................................9

        2.7    Agreement to Subordinate.....................................................9

SECTION 3.        INTEREST AND PAYMENTS....................................................10

        3.1    Interest....................................................................10

        3.2    Payment Dates...............................................................10

        3.3    Early Repayment.............................................................10

        3.4    Right of Offset.............................................................11

        3.5    Payments on Non-Business Day................................................11

        3.6    Payment Procedures..........................................................11

        3.7    Optional Prepayments........................................................11

        3.8    Collection Costs............................................................11

SECTION 4.        CONVERSION...............................................................11

        4.1    Exercise of Conversion Rights...............................................11

        4.2    Fair Market Value...........................................................12

        4.3    Conversion Notice...........................................................12

        4.4    Delivery of Loan Conversion Shares; Adjustment of Note......................13

        4.5    No Rights as Stockholders...................................................13

        4.6    Conditions Precedent to Each Conversion.....................................13

        4.7    Amylin Covenants Relating to Conversions....................................14

SECTION 5.        CONDITIONS PRECEDENT.....................................................14

        5.1    Conditions Precedent to Disbursement of Advances............................14
</TABLE>

                                       i

<PAGE>

<TABLE>
<S>                                                                                        <C>
        5.2    Closing Documents...........................................................15

SECTION 6.        REPRESENTATIONS AND WARRANTIES OF AMYLIN.................................16

        6.1    Organization, Good Standing and Qualification...............................16

        6.2    Authorization; Due Execution................................................16

        6.3    Valid Issuance of Stock.....................................................16

        6.4    No Defaults.................................................................16

        6.5    SEC Filings.................................................................16

        6.6    Governmental Consents.......................................................17

        6.7    No Conflict.................................................................17

        6.8    Litigation..................................................................17

        6.9    Payment of Taxes............................................................17

        6.10   Compliance..................................................................18

        6.11   Financial Statements........................................................18

        6.12   J&J Loan....................................................................18

        6.13   Full Disclosure; Survival...................................................18

SECTION 7.        REPRESENTATIONS AND WARRANTIES OF LILLY..................................18

        7.1    Authorization; Due Execution................................................18

        7.2    Purchase Entirely for Own Account...........................................18

        7.3    Disclosure of Information...................................................19

        7.4    Investment Experience.......................................................19

        7.5    Accredited Investor.........................................................19

        7.6    Restricted Securities.......................................................19

SECTION 8.        COVENANTS................................................................20

        8.1    Maintenance of Existence and Rights.........................................20

        8.2    Governmental and Other Approvals............................................20

        8.3    Compliance with Laws........................................................20

        8.4    Use of Proceeds.............................................................20

        8.5    Payment of Taxes............................................................20

        8.6    Financial and Other Reports.................................................21

        8.7    Access to Information.......................................................22

        8.8    Litigation..................................................................22

        8.9    Notices/Material Developments...............................................22

        8.10   No Liens....................................................................22
</TABLE>

                                       ii

<PAGE>

<TABLE>
<S>                                                                                        <C>
        8.11   No Prepayments of Debt......................................................22

        8.12   No Dividends................................................................22

SECTION 9.        EVENTS OF DEFAULT........................................................22

        9.1    Events of Default...........................................................22

SECTION 10.       LILLY'S RIGHTS AND REMEDIES..............................................23

        10.1   Rights and Remedies.........................................................23

        10.2   Waiver of Defaults..........................................................24

        10.3   Remedies Cumulative.........................................................24

        10.4   Waiver......................................................................24

SECTION 11.       AGREEMENT NOT TO SELL....................................................24

        11.1   Agreement Not to Sell.......................................................24

SECTION 12.       MISCELLANEOUS............................................................24

        12.1   Subordination...............................................................24

        12.2   Governing Law...............................................................25

        12.3   Assignment..................................................................25

        12.4   Entire Agreement............................................................25

        12.5   Severability................................................................25

        12.6   Titles and Subtitles........................................................25

        12.7   Notices.....................................................................25

        12.8   Waiver......................................................................26

        12.9   Counterparts................................................................26
</TABLE>

                                      iii

<PAGE>

                                 LOAN AGREEMENT

        THIS LOAN AGREEMENT (the "LOAN AGREEMENT") is made as of this 19th day
of September, 2002 (the "EFFECTIVE DATE") by and between AMYLIN PHARMACEUTICALS,
INC., a Delaware corporation, having a principal place of business at 9373 Towne
Center Drive, San Diego, California 92121 ("AMYLIN"), and ELI LILLY AND COMPANY,
an Indiana corporation having a principal place of business at Lilly Corporate
Center, Indianapolis, Indiana 46285 ("LILLY").

                                    RECITALS

        WHEREAS, Amylin and Lilly have entered into that certain Collaboration
Agreement of even date herewith (the "COLLABORATION AGREEMENT");

        WHEREAS, in connection with, and as a condition of Amylin and Lilly
entering into, the Collaboration Agreement, Amylin and Lilly have agreed to
enter into this Loan Agreement pursuant to which Amylin may obtain credit from
Lilly, subject to the terms and conditions stated herein, for amounts up to the
Loan Commitment; and

        WHEREAS, Lilly is willing to provide such credit to and in favor of
Amylin, subject to the terms and conditions of this Loan Agreement.

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

                                    AGREEMENT

SECTION 1. DEFINITIONS

        1.1 DEFINED TERMS. Unless otherwise defined in this Loan Agreement, all
capitalized terms shall have the meanings given them in the Collaboration
Agreement. As used in this Loan Agreement, the following terms shall have the
following respective meanings:

                "ADVANCE" means the loans made, or to be made, pursuant to
Section 2 of this Loan Agreement.

                "ADVANCE PERIOD" has the meaning specified in Section 2.1.

                "AMIGO TRIAL MILESTONE" means the passage of a period of
forty-five (45) days after the Early Termination Date without Lilly having
given, prior to the expiration of such period, notice of election to terminate
the Collaboration Agreement.

                "BID COMMERCIALIZATION COSTS" means Commercialization Costs
incurred or to be incurred by Amylin in the performance of its responsibilities
under the Commercialization Plan with respect to the BID Product.

                                       1.
<PAGE>

                "BID DEVELOPMENT COSTS" means Development Costs incurred or to
be incurred by Amylin in the performance of its responsibilities under the
Development Plan with respect to the BID Product.

                "BID PRODUCT" means the Product being studied in the Amigo
Trials.

                "BORROWING DATE" means any date on which an Advance occurs.

                "BORROWING REQUEST" shall have the meaning set forth in Section
2.2.

                "BUSINESS DAY" means any day, other than a Saturday, Sunday or
holiday.

                "COLLABORATION AGREEMENT" has the meaning specified in the
Recitals.

                "COLLATERAL" means all right, title and interest of Amylin in,
to and under the Amylin Rights and all other personal property of Amylin, other
than Excluded Intellectual Property, now owned and existing or hereafter
acquired or arising, and wherever located including, without limitation, the
following described property of Amylin (each capitalized term used in this
definition shall have in this definition and in this Agreement the meaning given
to it by the UCC): Accounts, General Intangibles, Chattel Paper, Commercial Tort
Claims, Documents, Instruments, Investment Property, letters of credit and
Letter-Of-Credit Rights, Equipment, Inventory, Goods, Software, all cash, and
Deposit Accounts and all demand, time, savings, passbook and like accounts
maintained by Amylin with any bank, savings and loan association, credit union
or like organization, all books and records (including, without limitation,
customer lists, credit files, computer programs, printouts and other computer
materials and records) of Amylin pertaining to any of the foregoing personal
property, and all Products of and Accessions to each and all of the foregoing
and all Proceeds of all and each of the foregoing.

                "COMMON STOCK" means Amylin's Common Stock, par value $0.001 per
share.

                "CONVERSION DATE" means, with respect to any Conversion, the
date as of which such Conversion is effective, determined in accordance with
Section 4.1.

                "CONVERTIBLE INDEBTEDNESS" means, as of any date, all
Indebtedness outstanding as of such date other than Indebtedness representing
the principal amount of any Advance that was made less than two years prior to
such date; provided, however, that all outstanding Indebtedness shall be deemed
to be Convertible Indebtedness immediately upon the occurrence of any Event of
Default.

                "DAMAGES" shall include any loss, damage, injury, decline in
value, lost opportunity, liability, claim, demand, settlement, judgment, award,
fine, penalty, tax, fee (including reasonable attorneys' fees), charge, cost
(including costs of investigation) or expense of any nature.

                "EFFECTIVE DATE" has the meaning specified in the opening
paragraph hereof.

                "EVENT OF DEFAULT" means any of those conditions or events
listed in Section 9 of this Loan Agreement.

                                       2.
<PAGE>

                "EXCLUDED INTELLECTUAL PROPERTY" means all Intellectual Property
of Amylin, now owned and existing or hereafter acquired, other than the Amylin
Rights.

                "FINANCIAL STATEMENTS" means, with respect to any accounting
period for any Person, consolidated statements of income, shareholders' equity
and cash flows of such Person and its subsidiaries for such period, and a
consolidated balance sheet of such Person and its subsidiaries as of the end of
such period, setting forth in each case in comparative form figures for the
corresponding period in the preceding fiscal year if such period is less than a
full fiscal year or, if such period is a full fiscal year, corresponding figures
from the preceding annual audit, all prepared in reasonable detail and in
accordance with GAAP.

                "FIRST PAYMENT DATE" means the earlier of (i) June 30, 2007, or
(ii) the first anniversary of Product Launch in the U.S.

                "FUNDAMENTAL CHANGE" means any (i) reclassification or
recapitalization of the outstanding shares of Common Stock, (ii) sale or
disposition of all or substantially all of Amylin's assets, (iii) merger or
similar transaction of Amylin in which Amylin is not the surviving entity or in
which Amylin survives as a wholly owned subsidiary of another entity, (iv)
conversion of Amylin from a corporation to another form of entity, or (v)
redomestication of Amylin from Delaware to any other jurisdiction of
organization.

                "GAAP" means United States generally accepted accounting
principles (including principles of consolidation), in effect from time to time,
consistently applied.

                "HSR ACT" means the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended.

                "INDEBTEDNESS" means, as of any given time, Amylin's entire
indebtedness to Lilly as of such time arising under any of the Loan Documents in
respect of principal, interest, fees, costs or otherwise.

                "INTELLECTUAL PROPERTY" means (a) all inventions (whether
patentable or unpatentable and whether or not reduced to practice), all
improvements thereto, and all rights arising under or in connection with all
Patents and Patent disclosures, (b) all trademarks, service marks, trade dress,
logos, slogans, trade names and corporate names, together with all translations,
adaptations, derivations and combinations thereof (including all goodwill
associated therewith), and all applications, registrations and renewals in
connection therewith, (c) all copyrightable works, all copyrights and all
applications, registrations and renewals in connection therewith, (d) all trade
secrets and confidential business information (including, without limitation,
ideas, research, know-how, techniques, methods, data, clinical and regulatory
strategies, customer lists, and business and marketing plans and proposals), (e)
all computer software (including data and related documentation), and (f) all
copies and tangible embodiments thereof (in whatever form or medium).

                "INTERCREDITOR AGREEMENT" has the meaning specified in Section
2.7.

                "J&J LOAN" means the Loan and Security Agreement dated June 20,
1995 by and between Amylin and Johnson & Johnson.

                                       3.
<PAGE>

                "LEGAL PROCEEDING" shall mean any action, suit, litigation,
arbitration, proceeding (including any civil, criminal, administrative,
investigative or appellate proceeding), hearing, inquiry, audit, examination or
investigation commenced, brought, conducted or heard by or before, or otherwise
involving, any court or other Governmental Authority or any arbitrator or
arbitration panel.

                "LEGAL REQUIREMENT" shall mean any federal, state, local,
municipal, foreign or other law, statute, constitution, principle of common law,
resolution, ordinance, code, edict, decree, rule, regulation, ruling or
requirement issued, enacted, adopted, promulgated, implemented or otherwise put
into effect by or under the authority of any Governmental Authority.

                "LIEN" means any mortgage, deed of trust, pledge, security
interest, encumbrance, lien, easement, servitude or charge of any kind,
including, without limitation, any irrevocable license, conditional sale or
other title retention agreement, any lease in the nature thereof, or any other
right of or arrangement with any creditor to have its claim satisfied out of any
specified property or leased asset with the proceeds therefrom prior to the
satisfaction of the claims of the general creditors of the owner thereof,
whether or not filed or recorded, or the filing of, or agreement to execute as
"debtor," any financing or continuation statement under the Uniform Commercial
Code of any jurisdiction.

                "LOAN COMMITMENT" means, prior to the achievement of the Amigo
Trial Milestone, the principal amount of $7,500,000 and, thereafter, the
principal amount of $110,000,000.

                "LOAN CONVERSION SHARES" means, collectively, the shares of
Common Stock issuable upon conversion of Convertible Indebtedness pursuant to
Section 4 of this Loan Agreement.

                "LOAN DOCUMENTS" means collectively, this Loan Agreement, the
Note, the Security Agreement, and any other agreement or instrument executed
pursuant to or in connection with the Obligations, as such documents may be
amended, modified, supplemented or restated from time to time. Loan Documents do
not include the Collaboration Agreement or the Related Agreements.

                "MATERIAL ADVERSE EFFECT" means a material adverse effect upon
(a) the business, condition (financial or otherwise), operations, performance or
assets of Amylin taken as a whole, (b) the ability of Amylin to perform its
obligations under the Loan Documents, or (c) the ability of Lilly to enforce the
Obligations or any of its rights in the Collateral.

                "MATURITY DATE" means, unless earlier converted, the earlier of
(i) thirty-six (36) months following Product Launch in the U.S. and (ii) June
30, 2009.

                "MAXIMUM SENIOR WORKING CAPITAL INDEBTEDNESS" has the meaning
specified in Section 2.7.

                "NOTE" means the convertible promissory note executed by Amylin
evidencing the Indebtedness, substantially in the form of EXHIBIT A attached
hereto.

                                       4.
<PAGE>

                "OBLIGATIONS" means all Indebtedness, liabilities, obligations,
covenants and duties arising under any of the Loan Documents owing by Amylin to
Lilly whether direct or indirect, absolute or contingent.

                "OTHER INDEBTEDNESS" means any indebtedness of Amylin for
borrowed money other than the Indebtedness.

                "PAYMENT DATE" means any of the dates on which payment of
unconverted Indebtedness is due as set forth in Section 2.7, 3.2, 3.3 or 10.1.

                "PERMITTED LIENS" means:

                (i) Liens securing purchase money indebtedness or obligations
        under any lease of property that is capitalized on Amylin's balance
        sheet in accordance with GAAP;

                (ii) Liens with respect to the payment of taxes, assessments or
        governmental charges that are not yet due or that are being contested in
        good faith by appropriate proceedings properly instituted and diligently
        conducted and with respect to which adequate reserves or other
        appropriate provisions are being maintained in accordance with GAAP;

                (iii) statutory Liens of landlords and Liens of suppliers,
        mechanics, carriers, materialmen, warehousemen or workmen and similar
        Liens imposed by law created in the ordinary course of business for
        amounts that are not yet due or that are being contested in good faith
        by appropriate proceedings properly instituted and diligently conducted
        and with respect to which adequate reserves or other appropriate
        provisions are being maintained in accordance with GAAP;

                (iv) Liens incurred or deposits made in the ordinary course of
        business in connection with worker's compensation, unemployment
        insurance or other types of social security benefits;

                (v) Liens arising with respect to zoning restrictions,
        easements, licenses, reservations, covenants, rights-of-way, utility
        easements, building restrictions and other similar charges or
        encumbrances on the use of real property which do not in any case
        materially detract from the value of the property subject thereto or
        interfere with the ordinary conduct of the business of Amylin; and

                (vi) any interest or title of the lessor in the property subject
        to any operating lease entered into by Amylin in the ordinary course of
        business.

                "REGISTRATION RIGHTS AGREEMENT" means the Registration Rights
Agreement between Lilly and Amylin entered into in connection with the execution
of this Loan Agreement and the Collaboration Agreement.

                "SEC" means the United States Securities and Exchange
Commission.

                                       5.
<PAGE>

                "SECOND PAYMENT DATE" means the earlier of (i) June 30, 2008, or
(ii) the second anniversary of Product Launch in the U.S.

                "SECURITY AGREEMENT" means the Security Agreement to be
negotiated in good faith by Amylin and Lilly and executed and delivered by
Amylin in favor of Lilly as soon as reasonably practicable following the date
hereof, as the same may be amended, restated, supplemented and/or modified from
time to time.

                "SECURITY INTEREST" has the meaning specified in Section 2.6.

                "SENIOR INDEBTEDNESS" means, as of any time, all Other
Indebtedness owing at such time pursuant to the J&J Loan in an amount not to
exceed the principal balance of the J&J Loan outstanding as of the Effective
Date plus all interest thereon accrued before, on or after the Effective Date.

                "SR DEVELOPMENT COSTS" means Development Costs incurred or to be
incurred by Amylin in the performance of its responsibilities under the
Development Plan with respect to the SR Product.

                "TERM" means the period from the Effective Date until the later
of (i) the expiration of the Advance Period, and (ii) the date on which all
outstanding Indebtedness has been repaid in full; provided that Amylin shall be
entitled to terminate this Agreement and the Term hereunder shall expire upon
written notice to Lilly at any time (a) prior to any Advance by Lilly to Amylin
hereunder or (b) following repayment in full of all then outstanding
Indebtedness.

                "UCC" means the Uniform Commercial Code as the same may, from
time to time, be in effect in the State of New York; provided, however, in the
event that, by reason of mandatory provisions of law, any or all of the
attachment, perfection or priority of Lilly's security interest in any
Collateral is governed by the Uniform Commercial Code as in effect in a
jurisdiction other than the State of New York, the term "UCC" shall mean the
Uniform Commercial Code as in effect in such other jurisdiction for purposes of
the provisions hereof relating to such attachment, perfection or priority and
for purposes of definitions related to such provisions.

                "WORKING CAPITAL LENDER" has the meaning specified in Section
2.7.

                "WORKING CAPITAL LOAN" has the meaning set forth in Section 2.7.

        1.2 ACCOUNTING TERMS. All accounting terms not specifically defined in
this Loan Agreement shall be determined and construed in accordance with GAAP.

        1.3 SINGULAR AND PLURAL. Where the context herein requires, the singular
number shall be deemed to include the plural, the masculine gender shall include
the feminine and neuter genders, and vice versa.

                                       6.
<PAGE>

        1.4 ELEMENTS OF THIS AGREEMENT. When a reference is made in this Loan
Agreement to the Recitals, Articles, Sections, Exhibits or Schedules, such
reference is to a Recital, Article or Section of, or an Exhibit or Schedule to,
this Loan Agreement, unless otherwise indicated.

SECTION 2. AMOUNT AND TERMS OF CREDIT

        2.1 COMMITMENT. Subject to the terms and conditions of this Loan
Agreement, Lilly agrees to make Advances to Amylin from time to time beginning
on the dates specified in Sections 2.3 and 2.4 and ending on the Business Day
immediately preceding the First Payment Date (the "ADVANCE PERIOD").
Notwithstanding any other provision of this Loan Agreement, the aggregate
principal amount of all Advances outstanding at any time shall not exceed the
amount of the Loan Commitment as of such time. The Advances shall be evidenced
by the Note executed by Amylin in the original principal amount of the Loan
Commitment.

        2.2 REQUESTS FOR ADVANCES. Amylin may request, no more frequently than
once per Calendar Quarter, an Advance (each such request, a "BORROWING REQUEST")
by delivering to Lilly a written request, which must also provide disbursement
instructions and include the certifications referred to in Section 5.1. Amylin
shall provide the amount and date of such Advance (which date must be a Business
Day not earlier than five (5) Business Days following the date of delivery of
such Borrowing Request) with respect to and at the time of each Borrowing
Request; provided, however, that the date of the Advance may follow the date of
delivery of the Borrowing Request by only one (1) Business Day if the full
amount of such Advance is to be applied by Lilly to amounts owing by Amylin to
Lilly pursuant to the Collaboration Agreement (i.e., Amylin's application of the
proceeds of such Advance must be consistent with the use of proceeds covenant
set forth in this Loan Agreement).

        2.3 DEVELOPMENT ADVANCES. During the Advance Period, Amylin may request
Advances to pay for Development Costs under the Collaboration Agreement as
follows:

                (a) Commencing with the Calendar Year during which the earlier
of the following occur: (i) the date on which the first Amigo Trial meets or
exceeds the primary clinical endpoint for such Phase 3 Clinical Trial, or (ii)
if primary endpoints in any of the Amigo Trials are not met or exceeded, the
date as of which the Amigo Trial Milestone has been achieved, then, subject to
the limit of the Loan Commitment in effect at the time of any Borrowing Request,
Amylin may request, beginning on the earlier of (i) or (ii) above, Advances of
up to [...***...] per Calendar Year (the "ANNUAL BID DEVELOPMENT LOAN AMOUNT")
for that Calendar Year and each of the next [...***...] Calendar Years (the "BID
DEVELOPMENT LOAN PERIOD") for the purpose of paying BID Development Costs (the
"BID DEVELOPMENT ADVANCES"). In any given Calendar Year, if Amylin receives BID
Development Advances totaling less than the Annual BID Development Loan Amount,
then in any subsequent Calendar Year during the BID Development Loan Period the
Annual BID Development Loan Amount applicable to such Calendar Year shall be
increased by the difference between the Annual BID Development Loan Amount
available for the preceding Calendar Year and the actual amount of BID
Development Advances that Amylin receives during such preceding Calendar Year.
Notwithstanding the foregoing or any other provision of this Loan Agreement,
Amylin shall not request, and Lilly shall not be obligated to make, BID
Development Advances in any Calendar Year in an aggregate amount greater than
the amount of BID Development

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       7.
<PAGE>

Costs reasonably anticipated to be incurred by Amylin during that year. The
approved Development Budget for any Calendar Year shall be the basis for
determining the amount of BID Development Costs reasonably anticipated to be
incurred by Amylin during that year, unless and until the JDC approves a
deviation from that budget.

                (b) Commencing with the Calendar Year in which Amylin first
enrolls a patient in a Phase 3 Clinical Trial for an SR Product, then, subject
to the limit of the Loan Commitment in effect at the time of any Borrowing
Request, Amylin may request Advances of up to [...***...] per Calendar Year (the
"ANNUAL SR DEVELOPMENT LOAN AMOUNT") for [...***...] Calendar Years (the "SR
DEVELOPMENT LOAN PERIOD") for the purpose of paying SR Development Costs (the
"SR DEVELOPMENT ADVANCES"). In any given Calendar Year, if Amylin receives SR
Development Advances totaling less than the Annual SR Development Loan Amount,
then in any subsequent Calendar Year during the SR Development Loan Period the
Annual SR Development Loan Amount applicable to such Calendar Year shall be
increased by the difference between the Annual SR Development Loan Amount
available for the preceding Calendar Year and the actual amount of SR
Development Advances that Amylin receives during such preceding Calendar Year.
Notwithstanding the foregoing or any other provision of this Loan Agreement,
Amylin shall not request, and Lilly shall not be obligated to make, SR
Development Advances in any Calendar Year in an aggregate amount greater than
the amount of SR Development Costs reasonably anticipated to be incurred by
Amylin during that year. The approved Development Budget for any Calendar Year
shall be the basis for determining the amount of SR Development Costs reasonably
anticipated to be incurred by Amylin during that year, unless and until the JDC
approves a deviation from that budget.

        2.4 COMMERCIALIZATION ADVANCES. During the Advance Period, Amylin may
request Advances to pay for BID Commercialization Costs (the "BID
COMMERCIALIZATION ADVANCES") as follows:

                (a) Commencing at the time Amylin receives notification from the
FDA of [...***...], then, subject to the limit of the Loan Commitment in effect
at the time of any Borrowing Request, Amylin may request BID Commercialization
Advances of up to [...***...].

                (b) Commencing at the time Amylin receives notification from the
FDA of [...***...], then, subject to the limit of the Loan Commitment in effect
at the time of any Borrowing Request, Amylin may request BID Commercialization
Advances of up to an additional [...***...].

                (c) Notwithstanding any other provision herein, prior to Product
Launch in the U.S., Amylin shall not request, and Lilly shall not be obligated
to make, BID Commercialization Advances in any Calendar Year in an aggregate
amount greater than the amount of BID Commercialization Costs reasonably
anticipated to be incurred by Amylin during that year. The approved
Commercialization Budget for any Calendar Year shall be the basis for
determining the amount of BID Commercialization Costs reasonably anticipated to
be incurred by Amylin during that year, unless and until the JCC approves a
deviation from that budget.

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       8.
<PAGE>
        2.5 DISBURSEMENT OF ADVANCES. Subject to the terms and conditions of
this Loan Agreement, Lilly shall make available to Amylin the amount of the
Advance requested in accordance with the applicable Borrowing Request. All
Advances pursuant to Sections 2.3 and 2.4 are cumulative, but shall not at any
time exceed the Loan Commitment in aggregate outstanding principal amount.

        2.6 SECURITY FOR OBLIGATIONS. Payment and performance of the Obligations
at all times shall be secured by a first and prior security interest in favor of
Lilly (the "SECURITY INTEREST") in all of Amylin's right, title and interest in
and to the Collateral, subject only to Permitted Liens and to the provisions of
Section 2.7 below.

        2.7 AGREEMENT TO SUBORDINATE. Notwithstanding any contrary provision in
this Loan Agreement or in the Security Agreement, Lilly agrees that:

                (a) WORKING CAPITAL LOAN. At any time upon the request of
Amylin, Lilly shall subordinate (a) the Indebtedness to Other Indebtedness
incurred by Amylin for working capital purposes (a "WORKING CAPITAL LOAN"), up
to a maximum aggregate amount of [...***...] (the "MAXIMUM SENIOR WORKING
CAPITAL INDEBTEDNESS"), pursuant to borrowing arrangements entered into from
time to time with one or more commercial lenders or lender groups (each, a
"WORKING CAPITAL LENDER"), and (b) the Security Interest to any security
interest hereafter granted by Amylin to any Working Capital Lender to secure any
Working Capital Loan up to the aggregate amount of the Maximum Senior Working
Capital Indebtedness. In connection with such subordination, Lilly will enter
into an intercreditor agreement with the Working Capital Lender containing terms
and conditions that are reasonably acceptable to both Lilly and the Working
Capital Lender (the "INTERCREDITOR AGREEMENT"). Notwithstanding any other
provision herein to the contrary, except as and to the extent provided in
Section 2.7(b) below, the subordination of the Indebtedness and the Security
Interest provided for herein shall be effective only to the extent of an amount
equal to the Maximum Senior Working Capital Indebtedness and shall not be
effective with respect to any portion of any Working Capital Loan in excess of
such amount. Furthermore, and notwithstanding any other provision herein to the
contrary, the "Maximum Senior Working Capital Indebtedness" shall be
[...***...].

                (b) UNLIMITED SENIOR WORKING CAPITAL INDEBTEDNESS. At any time
upon the request of Amylin, Lilly will enter into an amendment to the
Intercreditor Agreement to eliminate the cap on the Maximum Senior Working
Capital Indebtedness so that the Indebtedness and the Security Interest
thereafter will be subordinated to all Working Capital Loans without limitation
on the amount thereof, subject to the conditions precedent, however, that in
connection with such amendment:

                (i)     OUTSTANDING INDEBTEDNESS. If at the time such amendment
                        is to be entered into the outstanding amount of the
                        Indebtedness would, but for the provisions of this
                        clause (i), exceed [...***...], then Amylin shall make,
                        concurrently with or prior to the execution of such
                        amendment, a payment to Lilly in respect of the
                        Indebtedness in such amount as is necessary to

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                       9.
<PAGE>

                        reduce the outstanding amount of the Indebtedness to an
                        amount less than or equal to [...***...].

                (ii)    AMENDMENT TO LOAN AGREEMENT. Lilly and Amylin shall
                        enter into an amendment to this Loan Agreement, in form
                        and substance reasonably acceptable to both Lilly and
                        Amylin, which (x) reduces the amount of the Loan
                        Commitment applicable after achievement of the Amigo
                        Trial Milestone from $110,000,000 to [...***...], (y)
                        modifies the definition of Convertible Indebtedness by
                        replacing the phrase "other than Indebtedness
                        representing the principal amount of any Advance that
                        was made less than two years prior to such date" with
                        the phrase "other than Indebtedness representing the
                        principal amount of any Advance that was made less than
                        one year prior to such date"; and (z) makes such
                        conforming changes as may be necessary or appropriate,
                        in the reasonable judgment of Lilly and Amylin, to
                        effectuate the amendments referred to in clauses (x) and
                        (y) above.

                (iii)   CORRESPONDING AMENDMENTS TO OTHER AGREEMENTS. Lilly and
                        Amylin shall enter into such corresponding amendments,
                        if any, to the Collaboration Agreement and/or any of the
                        Related Agreements as may be necessary or appropriate,
                        in the reasonable judgment of Lilly and Amylin, to
                        effectuate the provisions of this Section 2.7(b).

SECTION 3. INTEREST AND PAYMENTS

        3.1 INTEREST.

                (a) ADVANCES. All Indebtedness outstanding from time to time
shall bear interest at a [...***...]; provided, however, that from and during
the continuance of an Event of Default, the outstanding Indebtedness shall bear
interest at a [...***...]. Interest shall be due and payable as provided in
Section 3.2.

                (b) INTEREST COMPUTATIONS. All interest chargeable under the
Loan Documents shall be computed on the basis of a three hundred sixty (360) day
year for the actual number of days elapsed.

        3.2 PAYMENT DATES. Except as provided in Sections 2.7(b)(i), 3.3 or
10.1, all outstanding Indebtedness shall be due and payable as follows: (i)
fifty percent (50%) of all Indebtedness outstanding as of the First Payment Date
shall be due and payable on the First Payment Date; (ii) sixty percent (60%) of
all Indebtedness outstanding as of the Second Payment Date shall be due and
payable on the Second Payment Date; and (iii) the balance of all outstanding
Indebtedness shall be due and payable on the Maturity Date.

        3.3 EARLY REPAYMENT. Notwithstanding Section 3.2 or any other provision
of this Loan Agreement, all outstanding Indebtedness shall be due and payable
immediately without any notice or other action by Lilly upon the occurrence of
any of the following events: (a) the

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                      10.
<PAGE>

consummation of a Change in Control with respect to Amylin, or (b) termination
of the Collaboration Agreement by Lilly pursuant to Section 12.2 thereof.

        3.4 RIGHT OF OFFSET. If and to the extent that Amylin defaults in the
making of any payment on any Payment Date and such default shall not have been
cured, Lilly may, at its election, withhold from Amylin the amount of any
milestone, royalty, expense reimbursement or other payment of any nature owing
from Lilly to Amylin under the Collaboration Agreement, any Related Agreement,
any Loan Document or otherwise, up to an aggregate amount equal to the amount of
the defaulted payment, and apply all amounts so withheld to the repayment of the
outstanding Indebtedness. Upon such application, Lilly shall be deemed to have
satisfied its obligation to pay the withheld amount to Amylin in respect of the
applicable milestone, royalty, expense reimbursement or other payment, and
Amylin shall be deemed to have discharged outstanding Indebtedness in the amount
so applied.

        3.5 PAYMENTS ON NON-BUSINESS DAY. In the event that any payment of any
principal, interest, fees or any other amounts payable by Amylin under or
pursuant to this Loan Agreement, or under any other Loan Document shall become
due on any day which is not a Business Day, such due date shall be extended to
the next succeeding Business Day, and, to the extent applicable, interest shall
continue to accrue and be payable at the applicable rate(s) for and during any
such extension.

        3.6 PAYMENT PROCEDURES. All sums payable by Amylin to Lilly under or
pursuant to this Loan Agreement, or any other Loan Document, whether principal,
interest, or otherwise, shall be paid, when due, directly to Lilly at the office
of Lilly identified in the opening paragraph of this Loan Agreement, or at such
other location as Lilly may designate in writing to Amylin from time to time, in
immediately available United States funds, and without setoff, deduction or
counterclaim.

        3.7 OPTIONAL PREPAYMENTS. Amylin may prepay the outstanding
Indebtedness, in whole or in part, without premium or penalty, at any time and
from time to time. Any partial prepayment shall be applied first to any
Indebtedness consisting of amounts other than principal and interest, second to
accrued but unpaid interest and finally to outstanding principal. Any partial
prepayment applied to outstanding principal shall be deemed applied to the
outstanding Advances in the order in which they were made.

        3.8 COLLECTION COSTS. All amounts payable by Amylin under any of the
Loan Documents shall be payable without relief from valuation and appraisement
laws, and with all collection costs and reasonable attorneys' fees.

SECTION 4. CONVERSION

        4.1 EXERCISE OF CONVERSION RIGHTS. At any time and from time to time,
but subject to Section 4.6, Lilly may elect to convert all or any portion of the
Convertible Indebtedness into shares of Common Stock as follows:

                (a) CONVERSION AMOUNT. Lilly shall deliver notice to Amylin
pursuant to Section 4.3 (a "CONVERSION NOTICE") specifying the amount of
Convertible Indebtedness to be so converted (the "CONVERSION AMOUNT"). Each
conversion of Convertible Indebtedness pursuant

                                      11.
<PAGE>

to such an election by Lilly shall be referred to herein as a "CONVERSION."
Lilly shall be permitted to deliver a Conversion Notice with respect to
Indebtedness that is not yet convertible as of the date of delivery of the
Conversion Notice, so long as such Indebtedness will become Convertible
Indebtedness on or before the applicable Conversion Date.

                (b) CONVERSION DATE. The Conversion Notice may include a demand
or request that Amylin file a resale registration statement pursuant to the
Registration Rights Agreement in connection with the Conversion and may specify
that the effectiveness of the Conversion is conditioned upon the prior or
concurrent effectiveness of such registration statement. If effectiveness of the
Conversion is so conditioned, then the Conversion Date shall be the later of (i)
the date on which such registration statement is declared effective by the SEC,
(ii) the date as of which all Section 4.6 conditions have been met, and (iii)
the date as of which Indebtedness in the full amount of the Conversion Amount
has become Convertible Indebtedness. If effectiveness of the Conversion is not
so conditioned, then the Conversion Date shall be the later of (i) the date
specified in the Conversion Notice (which shall be no earlier than the date on
which the Conversion Notice is delivered to Amylin), (ii) the date as of which
all Section 4.6 conditions have been met, and (iii) the date as of which
Indebtedness in the full amount of the Conversion Amount has become Convertible
Indebtedness.

                (c) CONVERSION PRICE. The number of shares of Common Stock
issuable in connection with a Conversion shall be equal to the quotient of the
applicable Conversion Amount divided by the Fair Market Value (as defined below)
of one share of Common Stock.

        4.2 FAIR MARKET VALUE. For purposes of this Loan Agreement, the "FAIR
MARKET VALUE" of Common Stock shall be determined as follows:

                (a) if the Common Stock is then traded on a national securities
exchange or through the Nasdaq National Market or Nasdaq Small Cap Market, the
Fair Market Value of one share of Common Stock shall be deemed to be the average
of the closing sale prices for one share of Common Stock on such exchange or
market, as the case may be, for the twenty (20) Business Days immediately
preceding the Conversion Date;

                (b) if the Common Stock is not traded on a national securities
exchange or through the Nasdaq National Market or Nasdaq Small Cap Market, but
is traded in the over-the-counter market, the Fair Market Value of one share of
Common Stock shall be deemed to be the average of the closing bid and asked
prices reported by such market for the twenty (20) Business Days immediately
preceding the Conversion Date; and

                (c) if the Common Stock is not traded on any recognized exchange
or market, the Fair Market Value of one share of Common Stock shall be
determined by Amylin's Board of Directors in good faith, which Board of
Directors shall provide Lilly with a written statement of such Fair Market Value
within fifteen (15) Business Days following any request therefor.

        4.3 CONVERSION NOTICE. A Conversion Notice to Amylin under this Section
4 shall be delivered to Amylin pursuant to the notice provisions set forth in
Section 12.7 of this Loan Agreement. Each such Conversion Notice shall state the
Conversion Amount applicable to the Conversion, instruct Amylin to deliver a
stock certificate representing the given Loan

                                      12.
<PAGE>

Conversion Shares in the name of Lilly or its designee, and contain a
certification by Lilly that its representations and warranties as set forth in
Section 7 of this Loan Agreement are true and correct on and as of the date that
such Conversion Notice is delivered to Amylin.

        4.4 DELIVERY OF LOAN CONVERSION SHARES; ADJUSTMENT OF NOTE. On each
Conversion Date, Lilly shall be entitled to receive a certificate for the number
of Loan Conversion Shares applicable to the Conversion determined in accordance
with this Section 4. Such certificate shall be issued, and Lilly shall be deemed
to own the Loan Conversion Shares represented thereby, as of the Conversion
Date. Upon the Conversion Date, but subject to Lilly's receipt of such
certificate, the outstanding Indebtedness prior to said Conversion shall be
deemed repaid to the extent of the applicable Conversion Amount as of the
Conversion Date. No fractional shares or scrip representing fractional shares
shall be issued in connection with a Conversion, and Lilly shall receive a cash
payment in lieu thereof.

        4.5 NO RIGHTS AS STOCKHOLDERS. Neither this Loan Agreement nor the Note
entitles Lilly to any voting rights or other rights as a stockholder of Amylin
prior to the time of any Conversion.

        4.6 CONDITIONS PRECEDENT TO EACH CONVERSION. The obligation of Amylin to
issue any Loan Conversion Shares shall be further subject to the satisfaction of
each of the following conditions precedent on or before the Conversion Date:

                (a) The representations and warranties made by Lilly in Section
7 hereof shall be true and correct on and as of the date that a Conversion
Notice is delivered to Amylin with the same force and effect as if they had been
made as of such date (except that Lilly's representations and warranties in
Section 7.2 may be made subject to Lilly's rights to resell Loan Conversion
Shares pursuant to any Registration Statement filed by the Company with respect
to such Shares pursuant to the Registration Rights Agreement);

                (b) Lilly shall have performed and complied in all material
respects with all agreements, obligations and conditions in this Loan Agreement,
if any, that are required to be performed or complied with by it on or before
the date that any Conversion Notice is delivered to Amylin, and no material
default by Lilly shall exist under the Collaboration Agreement or any Related
Agreement or Loan Document as of the date of such Conversion Notice;

                (c) No temporary restraining order, preliminary or permanent
injunction or other order preventing the consummation of the proposed Conversion
shall have been issued by any court of competent jurisdiction and remain in
effect, and there shall not be any Legal Requirement enacted or deemed
applicable to the proposed Conversion that makes consummation of the proposed
Conversion illegal;

                (d) No Person shall have commenced or threatened to commence any
Legal Proceeding challenging or seeking the recovery of a material amount of
Damages in connection with the proposed Conversion;

                (e) Amylin shall not be required to obtain stockholder approval
of the issuance of the Loan Conversion Shares applicable to the given Conversion
in order to comply with Nasdaq Stock Market Marketplace Rules or similar
stockholder voting requirements that

                                      13.
<PAGE>

may be imposed on Amylin by any other established stock exchange or national
market system on which the Common Stock is traded or listed (it being understood
that to the extent that and for so long as any such stockholder approval would
be required, Amylin shall not be obligated to make such Conversion or any other
Conversion under this Loan Agreement); and

                (f) The waiting period applicable to the consummation of the
transactions contemplated by this Loan Agreement, including any Conversion
hereunder, or under the Collaboration Agreement, under the HSR Act shall have
expired or been terminated.

                (g) The issuance of the Loan Conversion Shares shall not result
in Lilly having acquired, pursuant to the Collaboration Agreement, the Loan
Documents, and all of the Related Agreements, an aggregate number of shares of
Common Stock that exceeds the lesser of (i) 19.9% of the number of outstanding
shares of Common Stock as of the applicable Conversion Date or (ii) such number
of shares of Common Stock as would have required Amylin, pursuant to Nasdaq
rules, to obtain shareholder approval with respect to the transactions
contemplated by the Loan Documents, the Collaboration Agreement or the Related
Agreements. If the issuance would have that result, then Lilly may withdraw the
Conversion Notice or elect to reduce the Conversion Amount as necessary in order
to avoid that result (it being understood that to the extent that and for so
long as any such stockholder approval would be required, Amylin shall not be
obligated to make such Conversion or any other Conversion under this Loan
Agreement).

        4.7 AMYLIN COVENANTS RELATING TO CONVERSIONS. During the Term, Amylin
covenants and agrees as follows:

                (a) RESERVATION OF SHARES. It shall at all times reserve from
its authorized Common Stock a sufficient number of shares to provide for
conversion of all Convertible Indebtedness.

                (b) LISTING OF SHARES. It shall take all actions reasonably
necessary to cause all Loan Conversion Shares, upon issuance, to be eligible for
listing or trading on the principal market or exchange on which the Common Stock
is then listed or traded.

                (c) REGISTRATION OF SHARES. It shall comply with all of its
obligations under the Registration Rights Agreement.

                (d) FUNDAMENTAL CHANGE. In connection with any Fundamental
Change, Amylin shall make equitable provision so that, upon any Conversion
following such Fundamental Change, Lilly shall have the right to receive, in
lieu of shares of Common Stock, the kind and amount of securities and other
property that the holders of Common Stock received in connection with the
Fundamental Change.

SECTION 5. CONDITIONS PRECEDENT

        5.1 CONDITIONS PRECEDENT TO DISBURSEMENT OF ADVANCES. The obligation of
Lilly to make any Advance, including the initial Advance hereunder, shall be
subject to the satisfaction of each of the following conditions precedent on or
before any disbursement under such Advance:

                                      14.
<PAGE>

                (a) REPRESENTATIONS AND WARRANTIES. Each of the representations
and warranties of Amylin under the Collaboration Agreement (excluding Section
7.6 of the Collaboration Agreement) and this Loan Agreement shall be true and
correct in all material respects on and as of the date of the applicable
Borrowing Request with the same effect as though such representations and
warranties had been made on and as of such date.

                (b) PERFORMANCE. Amylin shall have performed all material
obligations and agreements and complied with all material covenants to be
performed or complied with by it on or before the date of the applicable
Borrowing Request pursuant to the Collaboration Agreement, any of the Related
Agreements or any of the Loan Documents.

                (c) SECURITY AGREEMENT. The Security Agreement, shall have been
duly authorized, executed and delivered by Amylin, and in compliance with the
terms of this Loan Agreement.

                (d) MILESTONES. The event or events required for such Advance
pursuant to Sections 2.3 and 2.4, as the case may be, shall have been achieved.

                (e) COLLABORATION AGREEMENT IN EFFECT. The Collaboration
Agreement shall not have been terminated pursuant to its terms, and neither
Lilly nor Amylin shall have given written notice of its intention to terminate
the Collaboration Agreement.

                (f) NO DEFAULT. No Event of Default shall have occurred and be
continuing.

                (g) CERTIFICATE. The applicable Borrowing Request shall include
a certification by Amylin's chief financial officer, dated the date of the
applicable Borrowing Request, in form and substance reasonably satisfactory to
Lilly, to the effect that the conditions precedent set forth in this Section 5.1
have been satisfied.

                (h) MISCELLANEOUS. Amylin shall have provided to Lilly such
documents and instruments as Lilly reasonably shall request for the purpose of
perfecting the Security Interest, including (i) Uniform Commercial Code
financing statements and (ii) filings to be made with the United States Patent
and Trademark Office or in any similar office or agency of the United States,
any State thereof or any other country or jurisdiction or any political
subdivision thereof.

        5.2 CLOSING DOCUMENTS. Amylin shall provide to Lilly on the Effective
Date each of the following:

                (a) NOTE. The Note, duly authorized, executed and delivered by
Amylin, and in compliance with the terms of this Loan Agreement.

                (b) REGISTRATION RIGHTS AGREEMENT. The Registration Rights
Agreement, duly authorized, executed and delivered by Amylin, and in compliance
with the terms of this Loan Agreement.

                                      15.
<PAGE>

                (c) CORPORATE DOCUMENTS. A certificate of good standing with
respect to Amylin, issued by the Delaware Secretary of State and reflecting
Amylin's existence in good standing and payment of all applicable taxes and
fees.

                (d) OPINION. A written opinion of Amylin's counsel, addressed to
Lilly, in form and substance acceptable to Lilly.

SECTION 6. REPRESENTATIONS AND WARRANTIES OF AMYLIN

        Amylin hereby represents and warrants to Lilly as of the Effective Date
that:

        6.1 ORGANIZATION, GOOD STANDING AND QUALIFICATION. Amylin is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Delaware and has all requisite corporate power and authority to
carry on its business. Amylin is duly qualified to transact business as a
corporation and is in good standing in each jurisdiction in which the failure so
to qualify would have a material adverse effect upon Amylin's ability to perform
its obligations under any of the Loan Documents or the validity or
enforceability of, or Lilly's rights and remedies under, this Loan Agreement or
any of the other Loan Documents.

        6.2 AUTHORIZATION; DUE EXECUTION. Amylin has the requisite corporate
power and authority to enter into each of the Loan Documents and to perform its
obligations under the terms of each of the Loan Documents and, at the time of a
Conversion pursuant to Section 4 of this Loan Agreement, will have the requisite
corporate power to issue and sell the Loan Conversion Shares. All corporate
action on the part of Amylin, its officers, directors and stockholders necessary
for the authorization, execution, delivery and performance of each of the Loan
Documents has been taken. Each of the Loan Documents has been duly authorized,
executed and delivered by Amylin and, upon due execution and delivery by Lilly
of this Loan Agreement, each of the Loan Documents will each be a valid and
binding agreement of Amylin, enforceable in accordance with its respective
terms, except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting creditors' rights generally
or by equitable principles.

        6.3 VALID ISSUANCE OF STOCK. The Loan Conversion Shares, when issued,
sold and delivered in accordance with the terms of Section 4 hereof for the
consideration and on the terms and conditions set forth herein, will be duly and
validly authorized and issued, fully paid and nonassessable and, based in part
upon the representations of Lilly in this Loan Agreement, will be issued in
compliance with all applicable federal and state securities laws.

        6.4 NO DEFAULTS. There exists no default under the provisions of any
instrument or agreement evidencing, governing or otherwise relating to any Other
Indebtedness, or with respect to any other agreement, a default under which
could have a material adverse effect upon Amylin's ability to perform its
obligations under any of the Loan Documents or the validity or enforceability
of, or Lilly's rights and remedies under, this Loan Agreement or any of the
other Loan Documents.

        6.5 SEC FILINGS. Amylin has timely filed with the SEC all reports,
registration statements and other documents required to be filed by it (the "SEC
FILINGS") under the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder (the

                                      16.
<PAGE>

"SECURITIES ACT"), and the Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated thereunder (the "EXCHANGE ACT"). The SEC
Filings were prepared in accordance with and, as of the date on which each such
SEC Filing was filed with the SEC, complied in all material respects with, the
applicable requirements of the Securities Act or the Exchange Act, as the case
may be. None of such SEC Filings, including, without limitation, any financial
statements, exhibits and schedules included therein and documents incorporated
therein by reference, at the time filed, declared effective or mailed, as the
case may be, contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, not misleading. Except to the extent information contained in any of the
SEC Filings has been revised, corrected or superseded by a later filing of any
such form, report or document, none of the SEC Filings currently contains an
untrue statement of a material fact or omits to state a material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading.

        6.6 GOVERNMENTAL CONSENTS. No consent, approval, order or authorization
of, or registration, qualification, designation, declaration or filing with, any
federal, state, local or provincial governmental authority on the part of Amylin
is required in connection with the consummation of the transactions contemplated
by the Loan Documents, except for such approvals or consents as may be required
under the HSR Act and such other notices as may be required or permitted to be
filed with certain state and federal securities commissions after the Effective
Date and after the issuance of Loan Conversion Shares, which notices will be
filed on a timely basis.

        6.7 NO CONFLICT. Amylin's execution, delivery and performance of each of
the Loan Documents does not violate any provision of Amylin's Certificate of
Incorporation or Bylaws, each as amended as of the date hereof (copies of which
have been filed with Amylin's SEC Filings), any provision of any order, writ,
judgment, injunction, decree, determination or award to which Amylin is a party
or by which it is bound, or, to Amylin's knowledge, any law, rule or regulation
currently in effect having applicability to Amylin.

        6.8 LITIGATION. Except and to the extent disclosed in Amylin's SEC
Filings, there is no action, litigation or proceeding pending or threatened
against or involving Amylin in any court or before or by any agency or
regulatory body which could result in a material judgment or liability against
Amylin or which could materially and adversely affect (i) any material
intellectual property of Amylin, (ii) any material portion of the Collateral,
(iii) the income of Amylin, or (iv) the right of Amylin to carry on its
businesses as now conducted or as intended to be conducted.

        6.9 PAYMENT OF TAXES. Amylin has filed all tax returns which were
required to be filed by it prior to and as of the date of this Loan Agreement.
Amylin has paid all taxes and assessments which to Amylin's knowledge are
payable by it, to the extent that the same have become due and payable and
before they became delinquent, except for any taxes or assessments that are
being contested in good faith by appropriate proceedings properly instituted and
diligently conducted. Amylin does not know of any proposed material tax
assessment against it or any of its properties for which adequate provision has
not been made on its books.

                                      17.
<PAGE>

        6.10 COMPLIANCE. Amylin is in compliance with and in conformity to all
laws, ordinances, rules, regulations and all other legal requirements, the
violation of which would have a material, adverse effect on its businesses,
financial condition or properties.

        6.11 FINANCIAL STATEMENTS. The financial statements of Amylin included
in its SEC Filings correctly and fairly present the financial condition, results
of operations and cash flows of Amylin as of the dates and for the periods shown
and covered thereby, in accordance with GAAP consistently applied, except that
any such financial statements covering less than a full year may not include
normal year-end adjustments or complete footnote disclosures. There has been no
material adverse change in Amylin's business, financial condition, operations or
prospects since the date of the most recent such financial statements.

        6.12 J&J LOAN. The copy of the J&J Loan filed with the SEC as an exhibit
to Amylin's Quarterly Report on Form 10-Q for the quarter ended June 30, 1995,
is a true, complete and correct copy of the J&J Loan (as redacted pursuant to an
Order of the SEC granting confidential treatment of certain provisions thereof).
The J&J Loan is in full force and effect, and no default has occurred or with
the passage of time or giving of notice would occur. The total amount of
indebtedness under the J&J Loan at June 30, 2002, was less than $60,000,000.
Amylin is not permitted to make any further principal draws under the J&J Loan.

        6.13 FULL DISCLOSURE; SURVIVAL. None of the representations or
warranties furnished by Amylin to Lilly in connection with any of the Loan
Documents contains or will contain any untrue statement or omits or will omit a
material fact necessary to make the statements contained therein, in light of
the circumstances when made, not misleading. All representations and warranties
made by Amylin under or in connection with any of the Loan Documents shall
survive the making of the Advances provided for herein and issuance and delivery
of the Note to Lilly, notwithstanding any investigation made by Lilly or on
Lilly's behalf.

SECTION 7. REPRESENTATIONS AND WARRANTIES OF LILLY

        Lilly hereby represents and warrants to Amylin as of the Effective Date
that:

        7.1 AUTHORIZATION; DUE EXECUTION. Lilly has the requisite corporate
power and authority to enter into this Loan Agreement and to perform its
obligations under the terms of this Loan Agreement and the Loan Documents and,
at the time of each Conversion pursuant to Section 4 of this Loan Agreement,
will have the requisite corporate power to acquire the Loan Conversion Shares.
All corporate action on the part of Lilly, its officers, directors and
stockholders necessary for the authorization, execution, delivery and
performance of this Loan Agreement and the Loan Documents have been taken. This
Loan Agreement has been duly authorized, executed and delivered by Lilly, and,
upon due execution and delivery by Amylin, this Loan Agreement will be a valid
and binding agreement of Lilly, enforceable in accordance with its terms, except
as enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting creditors' rights generally or by equitable
principles.

        7.2 PURCHASE ENTIRELY FOR OWN ACCOUNT. This Loan Agreement is made with
Lilly in reliance upon Lilly's representation to Amylin, which by Lilly's
execution of this Loan

                                      18.
<PAGE>

Agreement it hereby confirms, that the Note and the Loan Conversion Shares, if
any, purchased by Lilly will be acquired for investment for Lilly's own account,
not as a nominee or agent, and not with a view to the resale or distribution of
any part thereof, and that Lilly has no present intention of selling, granting
any participation in, or otherwise distributing the same. By executing this Loan
Agreement, Lilly further represents that it does not have any contract,
undertaking, agreement or arrangement with any person to sell, transfer or grant
participation to such person or to any third person, with respect to the Note or
any of the Loan Conversion Shares, if issued.

        7.3 DISCLOSURE OF INFORMATION. Lilly has received all the information
that it has requested and that it considers necessary or appropriate for
deciding whether to enter into this Loan Agreement and to exercise its
conversion rights under Section 4 of this Loan Agreement to acquire the Loan
Conversion Shares. Lilly further represents that it has had an opportunity to
ask questions and receive answers from Amylin regarding the terms and conditions
of the offering of the Note and the Loan Conversion Shares.

        7.4 INVESTMENT EXPERIENCE. Lilly is an investor in securities of
companies in the development stage and acknowledges that it is able to fend for
itself, can bear the economic risk of its investment and has such knowledge and
experience in financial or business matters that it is capable of evaluating the
merits and risks of the investment in the Note and the Loan Conversion Shares,
if issued. Lilly also represents it has not been organized solely for the
purpose of acquiring the Note or the Loan Conversion Shares.

        7.5 ACCREDITED INVESTOR. Lilly is an "accredited investor" as such term
is defined in Rule 501 of the General Rules and Regulations prescribed by the
SEC pursuant to the Securities Act.

        7.6 RESTRICTED SECURITIES. Lilly understands that (a) the Note has not
been, and that the Loan Conversion Shares will not be, registered under the
Securities Act by reason of a specific exemption therefrom, that such securities
must be held by it indefinitely and that Lilly must, therefore, bear the
economic risk of such investment indefinitely, unless a subsequent disposition
thereof is registered under the Securities Act or is exempt from such
registration; (b) any transfer of the Loan Conversion Shares, if issued, will be
subject to the provisions of the Registration Rights Agreement; and (c) each
certificate representing the Loan Conversion Shares, if issued, and the Note
will be endorsed with the following legends:

                (i)     THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN
                        REGISTERED UNDER THE SECURITIES ACT OF 1933 (THE "ACT")
                        AND MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED,
                        ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL
                        REGISTERED UNDER THE ACT OR UNLESS THE COMPANY HAS
                        RECEIVED AN OPINION OF COUNSEL SATISFACTORY TO THE
                        COMPANY AND ITS COUNSEL THAT SUCH REGISTRATION IS NOT
                        REQUIRED;

                (ii)    Any legend required to be placed thereon pursuant to the
                        Registration Rights Agreement;

                                      19.
<PAGE>

                (iii)   Any legend required to be placed thereon by Amylin's
                        Bylaws or under applicable state securities laws; and

and (c) Amylin will instruct any transfer agent not to register the transfer of
the Note or the Loan Conversion Shares (or any portion thereof) unless the
conditions specified in the foregoing legends are satisfied, until such time as
a transfer is made in compliance with the Securities Act, the Registration
Rights Agreement and this Loan Agreement.

SECTION 8. COVENANTS

        Amylin covenants and agrees that, during the Term, it will:

        8.1 MAINTENANCE OF EXISTENCE AND RIGHTS. Maintain and preserve in full
force and effect its existence and all rights, contracts, licenses, leases,
qualifications, privileges, franchises and other authority necessary for the
conduct of its business, and qualify and remain qualified to do business in each
jurisdiction in which such qualification is material to its business and
operations or ownership of its properties, except where the lapsing of any of
the foregoing would not cause or result in a material adverse effect upon
Amylin's ability to perform its obligations under any of the Loan Documents or
the validity or enforceability of, or Lilly's rights and remedies under, this
Loan Agreement or any of the other Loan Documents.

        8.2 GOVERNMENTAL AND OTHER APPROVALS. Apply for, obtain and maintain in
effect, as applicable, all material authorizations, consents, approvals,
licenses, qualifications, exemptions, filings, declarations and registrations
(whether with any court, governmental agency, regulatory authority, securities
exchange or otherwise) which are necessary in connection with the execution,
delivery and performance by Amylin of this Loan Agreement, the Collaboration
Agreement, the Related Agreements, the Loan Documents, or any other documents or
instruments to be executed or delivered by Amylin, in connection therewith or
herewith and the transactions consummated or to be consummated hereunder or
thereunder.

        8.3 COMPLIANCE WITH LAWS. Comply in all material respects with all laws,
rules and regulations applicable to Amylin, except where Amylin's failure to
comply with any of the foregoing would not cause or result in a material adverse
effect upon Amylin's ability to perform its obligations under the Collaboration
Agreement, the Related Agreements or any of the Loan Documents or the validity
or enforceability of, or Lilly's rights and remedies under, this Loan Agreement
or any of the other Loan Documents.

        8.4 USE OF PROCEEDS. Use the proceeds of each BID Development Advance
exclusively to pay for BID Development Costs; use the proceeds of each SR
Development Advance exclusively to pay for SR Development Costs; and use the
proceeds of each BID Commercialization Advance exclusively to pay for BID
Commercialization Costs.

        8.5 PAYMENT OF TAXES. Pay and discharge (a) all taxes, assessments and
governmental charges or levies imposed upon it or its income or property prior
to the date on which penalties attach thereto and (b) all lawful claims and
debts which, if unpaid, might become a Lien upon any of its property; provided
that Amylin shall not be required to pay any such tax, assessment, charge, levy,
claim or debt for which Amylin has obtained a bond or insurance, or

                                      20.
<PAGE>

for which it has established a reserve, if the payment thereof is being
contested in good faith and by appropriate proceedings which are being
reasonably and diligently pursued.

        8.6 FINANCIAL AND OTHER REPORTS. Maintain a standard system of
accounting in accordance with GAAP and, except to the extent publicly available
in the SEC's EDGAR System, furnish or cause to be furnished to Lilly:

                (a) As soon as practicable, and in any event within forty-five
(45) days (or such shorter period of time as is required by the SEC for filing
of quarterly financial statements) after the end of each of the first three
fiscal quarters in each fiscal year, the consolidated balance sheet of Amylin
and its subsidiaries as at the end of such period and the related consolidated
statements of income and cash flows of Amylin and its subsidiaries for such
fiscal quarter and for the period from the beginning of the then current fiscal
year to the end of such fiscal quarter, certified by the chief financial officer
or treasurer of Amylin as fairly presenting in all material respects the
consolidated financial position of Amylin and its subsidiaries as at the dates
indicated and the consolidated results of their operations and cash flows for
the periods indicated in accordance with GAAP. Delivery within the time period
specified above of copies of Amylin's Quarterly Reports on Form 10-Q prepared in
compliance with the requirements of the Exchange Act, in the form filed with the
SEC, shall be deemed to satisfy the requirements of this paragraph.

                (b) As soon as practicable, and in any event within ninety (90)
days (or such shorter period of time as is required by the SEC for filing of
annual financial statements) after the end of each fiscal year, (i) the
consolidated balance sheet of Amylin and its subsidiaries as at the end of such
fiscal year and the related consolidated statements of income, stockholders'
equity and cash flows of Amylin and its subsidiaries for such fiscal year and,
in comparative form the corresponding figures for the previous fiscal year and
(ii) an audit report on the items listed in clause (i) hereof of independent
certified public accountants of recognized national standing, which audit report
shall be unqualified and shall state that such financial statements fairly
present in all material respects the consolidated financial position of Amylin
and its subsidiaries as at the dates indicated and the consolidated results of
their operations and cash flows for the periods indicated in conformity with
GAAP and that the examination by such accountants in connection with such
consolidated financial statements has been made in accordance with generally
accepted auditing standards. Delivery within the time period specified above of
Amylin's Annual Report on Form 10-K for such fiscal year (together with Amylin's
annual report to shareholders, if any, prepared pursuant to Rule 14a-3 under the
Exchange Act) prepared in accordance with the requirements of the Exchange Act,
in the form filed with the SEC, shall be deemed to satisfy the foregoing
requirements of this paragraph; provided that the auditors' report contained
therein satisfies the requirements specified in clause (ii) above.

                (c) Such other reports and additional financial and other
information relating to the business, affairs and financial condition of Amylin
as Lilly reasonably may request in writing from time to time (subject to
Amylin's obligations to third parties and provided that Amylin shall have no
obligation to provide access to information that it deems highly confidential).
Any information disclosed to Lilly pursuant to this Agreement shall be deemed

                                      21.
<PAGE>

Amylin Confidential Information subject to the provisions of Article 6 of the
Collaboration Agreement.

        8.7 ACCESS TO INFORMATION. At all reasonable times and as often as Lilly
may reasonably request, permit authorized representatives of Lilly to: (a) have
access to the financial records of Amylin and other records relating to the
Collateral or the operations and procedures of Amylin; and (b) discuss the
affairs, finances and accounts of Amylin with, and be advised as to the same by,
the officers of Amylin, all as shall be relevant to the performance or
observance of the terms, covenants and conditions of this Loan Agreement or the
other Loan Documents or the financial condition of Amylin; provided, however,
that the foregoing shall be subject to Amylin's obligations to third parties and
in no event shall Amylin be required to provide access to information that it
deems highly confidential. Any information disclosed to Lilly pursuant to this
Agreement shall be deemed Amylin Confidential Information subject to the
provisions of Article 6 of the Collaboration Agreement. In exercising its rights
under this Section 8.7, Lilly shall take reasonable precautions so that
information provided to Lilly concerning aspects of Amylin's business,
operations, properties and assets unrelated to the Collaboration are used solely
for purposes of administering this Loan Agreement and are not disclosed to Lilly
personnel who have no need to know such information for such purpose.

        8.8 LITIGATION. Notify Lilly in writing, promptly upon learning thereof,
of any litigation commenced against Amylin which may have a Material Adverse
Effect.

        8.9 NOTICES/MATERIAL DEVELOPMENTS. Promptly (and in any event within
three (3) calendar days) after obtaining knowledge of the occurrence of any
event that has resulted in or may result in a Material Adverse Effect or a
material diminution in the value of the Collateral, deliver to Lilly a statement
of the chief executive officer or chief financial officer of Amylin setting
forth the details of each such event and the action which Amylin has taken and
proposes to take with respect thereto. In addition, Amylin shall immediately
inform Lilly by written notice of the occurrence of any event or condition of
any nature which may constitute or result in an Event of Default.

        8.10 NO LIENS. Not create or permit any Lien upon any part of the
Collateral other than those created by the Security Agreement and Permitted
Liens (as such term is defined in the Security Agreement), and other than any
Lien contemplated by Section 2.7.

        8.11 NO PREPAYMENTS OF DEBT. At any time while an Event of Default shall
exist, not prepay any debt to any person other than Lilly.

        8.12 NO DIVIDENDS. Not pay any dividends on, or make any distributions
with respect to, its Common Stock other than distributions payable solely in
additional shares of Common Stock.

SECTION 9. EVENTS OF DEFAULT

        9.1 EVENTS OF DEFAULT. The occurrence or existence of any of the
following conditions or events shall constitute an "Event of Default" hereunder:

                                      22.
<PAGE>

                (a) FAILURE TO PAY. Amylin shall fail to pay, when due any
principal, interest or other sums due to Lilly under this Loan Agreement;

                (b) OTHER DEFAULTS UNDER THE LOAN DOCUMENTS. Any default in the
observance or performance of any of the other conditions, covenants or
agreements of Amylin set forth in this Loan Agreement or in any Loan Document,
and continuance thereof for a period of [...***...];

                (c) INSOLVENCY; BANKRUPTCY. If (i) Amylin becomes insolvent or
generally fails to pay, or admits in writing its inability to pay, its debts as
they mature, or applies for, consents to, or acquiesces in the appointment of a
trustee, receiver, liquidator, conservator or other custodian for itself, or a
substantial part of its property, or makes a general assignment for the benefit
of creditors; (ii) Amylin files a voluntary petition in bankruptcy or a trustee,
receiver, liquidator, conservator or other custodian is appointed for Amylin or
for a substantial part of its property; (iii) any bankruptcy, reorganization,
debt arrangement, or other proceedings under any bankruptcy or insolvency law,
or any dissolution or liquidation proceeding, is instituted by or against
Amylin, and the same is consented to or acquiesced by Amylin, or otherwise
remains undismissed for sixty (60) days; or (iv) any warrant of attachment is
issued against any substantial part of the property of Amylin which is not
released within thirty (30) days of service thereof.

                (d) REPRESENTATIONS AND WARRANTIES. Any representation or
warranty made by Amylin in any Loan Document or in the Collaboration Agreement
shall fail to be true and correct in any material respect when made or deemed to
have been made.

                (e) DEFAULT WITH RESPECT TO OTHER INDEBTEDNESS. Amylin shall
default with respect to (i) any payment of principal of or interest on any Other
Indebtedness beyond any period of grace provided with respect thereto in an
amount greater than [...***...], or (ii) the performance of any other covenant,
term or condition contained in any agreement or instrument under which any Other
Indebtedness is created or governed if the effect of such performance default is
to accelerate the maturity of any Other Indebtedness in an amount greater than
[...***...] or to permit the holder of any such Other Indebtedness to accelerate
the maturity of an amount of Other Indebtedness greater than [...***...].

SECTION 10. LILLY'S RIGHTS AND REMEDIES

        10.1 RIGHTS AND REMEDIES. Upon the occurrence and during the continuance
of an Event of Default, Lilly may, at its election, without notice of its
election and without demand, do any one or more of the following, all of which
are authorized by Amylin:

                (a) Declare all Obligations, whether evidenced by this Loan
Agreement, by any of the other Loan Documents, or otherwise, immediately due and
payable (provided, that upon the occurrence of an Event of Default described in
SECTION 9.1(c), all Obligations shall become immediately due and payable without
any action by Lilly);

                (b) Cease advancing money or extending credit to or for the
benefit of Amylin under this Loan Agreement; and

                                               *CONFIDENTIAL TREATMENT REQUESTED

                                      23.
<PAGE>

                (c) Terminate this Loan Agreement as to any future liability or
obligation of Lilly, but without affecting the Obligations of Amylin to Lilly.

        10.2 WAIVER OF DEFAULTS. No Event of Default shall be waived by Lilly
except in a written instrument specifying the scope and terms of such waiver and
signed by an authorized officer of Lilly, and such waiver and shall be effective
only for the specific times and purposes given. No single or partial exercise of
any right, power or privilege hereunder, nor any delay in the exercise thereof,
shall preclude other or further exercise of Lilly's rights. No waiver of any
Event of Default shall extend to any other or further Event of Default. No
forbearance on the part of Lilly in enforcing any of Lilly's rights or remedies
hereunder or under any of the other Loan Documents shall constitute a waiver of
any of its rights or remedies.

        10.3 REMEDIES CUMULATIVE. Lilly's rights and remedies under this Loan
Agreement, the Loan Documents, and all other agreements shall be cumulative.
Lilly shall have all other rights and remedies not expressly set forth herein as
provided under applicable law, or in equity. No exercise by Lilly of one right
or remedy shall be deemed an election, and no waiver by Lilly of any Event of
Default on Amylin's part shall be deemed a continuing waiver. No delay by Lilly
shall constitute a waiver, election, or acquiescence by it. No waiver by Lilly
shall be effective unless made in a written document signed on behalf of Lilly
and then shall be effective only in the specific instance and for the specific
purpose for which it was given.

        10.4 WAIVER. Amylin waives demand, protest, notice of protest, notice of
default or dishonor, notice of payment and nonpayment, notice of any default,
nonpayment at maturity, release, compromise, settlement, extension, or renewal
of accounts, documents, instruments, chattel paper, and guarantees at any time
held by Lilly on which Amylin may in any way be liable.

SECTION 11. AGREEMENT NOT TO SELL

        11.1 AGREEMENT NOT TO SELL. Lilly hereby agrees that, from the Effective
Date until such time as the parties have received the final report of the
results of all Amigo Trials, Lilly shall not, without the prior written consent
of Amylin, directly or indirectly, sell, contract to sell (including, without
limitation, any short sale), grant any option to purchase or otherwise transfer
or dispose of any securities of Amylin held by it at any time during such
period. In order to enforce the provisions of this Section 11.1, Amylin may
impose stop-transfer instructions with respect to the securities held by Lilly
that are subject to the foregoing restriction until the end of such period.

SECTION 12. MISCELLANEOUS

        12.1 SUBORDINATION. To the extent set forth herein, the Indebtedness
shall be subordinate and junior in right of payment to the Senior Indebtedness.
Notwithstanding the foregoing, Lilly may receive from Amylin and Amylin may pay
to Lilly all payments with respect to the Indebtedness as and when called for or
permitted hereunder unless and until such time as any holder of Senior
Indebtedness notifies Lilly that a default has occurred with respect to such
Senior Indebtedness and that such defaulted Senior Indebtedness has been
accelerated pursuant to its terms; thereafter, Lilly may not receive payments
with respect to the Indebtedness

                                      24.
<PAGE>

so long as such holder is diligently pursuing collection of the defaulted Senior
Indebtedness by formal legal proceedings, until such time as the default with
respect to such Senior Indebtedness has been cured or waived or such Senior
Indebtedness has been discharged in full.

        12.2 GOVERNING LAW. This Loan Agreement, and each of the other Loan
Documents shall be governed by and construed in accordance with the laws of the
State of New York.

        12.3 ASSIGNMENT. This Loan Agreement will inure to the benefit and be
binding upon each party, its successors and assigns. The Loan Agreement may not
be assigned or otherwise transferred, nor, except as expressly provided
hereunder, may any right or obligation hereunder be assigned or transferred by
either party without the prior written consent of the other party; provided,
however, that either party may, without such consent, assign this Loan Agreement
and its rights and obligations hereunder to an Affiliate or in connection with
the transfer or sale of all or substantially all of its assets or business to
which this Loan Agreement relates, or in the event of its merger or
consolidation or change in control or similar transaction. The rights and
obligations of the parties under this Loan Agreement shall be binding upon and
inure to the benefit of the successors and permitted assigns of the parties. Any
attempted assignment not in accordance with this Section will be void.

        12.4 ENTIRE AGREEMENT. This Loan Agreement, the exhibits and schedules
hereto, the other Loan Documents, the Collaboration Agreement, the Related
Agreements and the other documents delivered pursuant hereto constitute the full
and entire understanding and agreement between the parties with regard to the
subjects hereof.

        12.5 SEVERABILITY. In case any provision of this Loan Agreement shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.

        12.6 TITLES AND SUBTITLES. The titles of the sections and subsections of
the Loan Agreement are for convenience of reference only and are not to be
considered in construing this Loan Agreement.

        12.7 NOTICES. All notices which are required or permitted hereunder will
be in writing and sufficient if delivered personally, sent by facsimile or email
to a current fax number or e-mail address for the recipient (and promptly
confirmed by personal delivery, registered or certified mail or overnight
courier), sent by nationally-recognized overnight courier or sent by registered
or certified mail, postage prepaid, return receipt requested, addressed as
follows:

        if to Amylin, to:       Amylin Pharmaceuticals, Inc.
                                9373 Towne Centre Drive, Suite 250
                                San Diego, California  92121
                                Attention:  Chairman and Chief Executive Officer
                                Fax No.:  (858) 552-1936
                                E-Mail:  jcook@amylin.com

                                      25.
<PAGE>

        with a copy to:         Attention: General Counsel
                                Fax No.: (858) 552-1936
                                E-Mail: lrowland@amylin.com

        if to Lilly, to:        Eli Lilly and Company
                                Lilly Corporate Center
                                Indianapolis, IN 46285
                                Attention: General Counsel

or to such other address as the party to whom notice is to be given may have
furnished to the other party in writing in accordance herewith. Any such notice
will be deemed to have been given when delivered if personally delivered or sent
by facsimile on a Business Day, on the Business Day after dispatch if sent by
nationally-recognized overnight courier and on the third Business Day following
the date of mailing if sent by mail.

        12.8 WAIVER. The waiver by either party hereto of any right hereunder,
or the failure to perform, or a breach by the other party will not be deemed a
waiver of any other right hereunder or of any other breach or failure by said
other party whether of a similar nature or otherwise.

        12.9 COUNTERPARTS. This Loan Agreement may be executed in two or more
counterparts, each of which will be deemed an original, but all of which
together will constitute one and the same instrument.

                          [THE SIGNATURE PAGE FOLLOWS.]

                                      26.
<PAGE>

        WITNESS the due execution hereof as of the day and year first above
written.

ELI LILLY AND COMPANY                   AMYLIN PHARMACEUTICALS, INC.

By: /s/ AUGUST M. WATANABE              By: /s/ JOSEPH C. COOK, JR.
  ----------------------------------       -------------------------------------

Name: August M. Watanabe                Name: Joseph C. Cook
     -------------------------------         -----------------------------------
Title: Executive Vice President         Title: Chairman and Chief
       Science/Technology                      Executive Officer

                       [SIGNATURE PAGE TO LOAN AGREEMENT]

<PAGE>

                                    EXHIBIT A

THIS CONVERTIBLE PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED. NO SALE OR DISPOSITION MAY BE EFFECTED EXCEPT IN
COMPLIANCE WITH RULE 144 UNDER SAID ACT OR AN EFFECTIVE REGISTRATION STATEMENT
RELATED THERETO OR AN OPINION OF COUNSEL FOR THE HOLDER, SATISFACTORY TO THE
COMPANY, THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE ACT OR RECEIPT OF A
NO-ACTION LETTER FROM THE SECURITIES AND EXCHANGE COMMISSION.

                           CONVERTIBLE PROMISSORY NOTE

$110,000,000                                               San Diego, California
                                                              September __, 2002

        AMYLIN PHARMACEUTICALS , INC., a Delaware corporation ("AMYLIN"), for
value received, hereby promises to pay to the order of ELI LILLY AND COMPANY, an
Indiana corporation ("LILLY"), in lawful money of the United States of America,
the principal amount of $110,000,000 or the aggregate principal amount of all
outstanding Advances, together with interest as provided for below, payable on
the dates, in the amounts and in the manner set forth below.

        1. LOAN AGREEMENT. This Convertible Promissory Note is the Note referred
to in that certain Loan Agreement, dated as of the date hereof, by and between
Amylin and Lilly (as the same may be amended, supplemented, restated or
otherwise modified from time to time, the "LOAN AGREEMENT"). Capitalized terms
used herein without definitions shall have the meanings given to such terms in
the Loan Agreement.

        2. REQUESTS FOR ADVANCES. Amylin may request an Advance by delivering to
Lilly a Borrowing Request pursuant to Section 2.2 of the Loan Agreement.

        3. PRINCIPAL PAYMENTS. Subject to the terms and conditions of the Loan
Agreement, the total outstanding balance of all Indebtedness not earlier
converted in accordance with the terms of the Loan Agreement shall be due and
payable in accordance with the terms of the Loan Agreement.

        4. INTEREST. The outstanding Indebtedness shall accrue interest at the
rate or rates per annum set forth in the Loan Agreement.

        5. CONVERSION. The outstanding Indebtedness is convertible into Common
Stock of Amylin in accordance with Section 4 of the Loan Agreement.

        6. PAYMENT ON NON-BUSINESS DAY. In the event that any payment of
principal, interest, fees or any other amounts payable by Amylin under or
pursuant to this Note shall become due on any day which is not a Business Day,
such due date shall be extended to the next succeeding

                                       -1-
<PAGE>

Business Day, and, to the extent applicable, interest shall continue to accrue
and be payable at the applicable rate for and during any such extension.

        7. DEFAULT. Upon the occurrence of an Event of Default under the Loan
Agreement or any of the other Loan Documents, all unpaid principal, accrued
interest and other amounts owing hereunder shall become immediately due and
payable as provided in the Loan Agreement, the other Loan Documents and
applicable law.

        8. WAIVERS. Amylin hereby waives presentment, demand, protest, notice of
dishonor, notice of demand or intent to demand, notice of acceleration or intent
to accelerate, and all other notices, and Amylin agrees that no extension or
indulgence to Amylin or the release, substitution or nonenforcement of any
security, or the release or substitution of Amylin, whether with or without
notice, shall affect the obligations of Amylin. The right to plead any and all
statutes of limitation as a defense to any demands hereunder is hereby waived by
Amylin to the full extent permitted by law. In addition, Amylin waives all
defenses or rights to discharge available to it and waives all other suretyship
defenses or rights to discharge.

        9. GOVERNING LAW. This Note shall be governed by and construed in
accordance with the laws of the State of New York.

AMYLIN:                                AMYLIN PHARMACEUTICALS, INC.

                                       /s/ JOSEPH C. COOK, JR.
                                       -----------------------------------------
                                       By: Joseph C. Cook, Jr.
                                          --------------------------------------
                                       Its: Chairman and Chief Executive Officer
                                           -------------------------------------

                                      -2-

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