COR THERAPEUTICS INC / DE, DEF 14A, 1999-04-19

COR THERAPEUTICS INC / DE
DEF 14A, 1999-04-19
PHARMACEUTICAL PREPARATIONS

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SCHEDULE 14A INFORMATION

PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [ ]

Check the appropriate box:

[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12

COR Therapeutics, Inc.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

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(2) Aggregate number of securities to which transaction applies:

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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):

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(4) Proposed maximum aggregate value of transaction:

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(5) Total fee paid:

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[ ] Fee paid previously with preliminary materials.

[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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(2) Form, Schedule or Registration Statement No.:

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(3) Filing Party:

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(4) Date Filed:

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<PAGE> 2

COR THERAPEUTICS, INC.
256 EAST GRAND AVENUE
SOUTH SAN FRANCISCO, CA 94080
------------------------

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 25, 1999

TO THE STOCKHOLDERS OF COR THERAPEUTICS, INC.:

NOTICE IS HEREBY GIVEN that the Annual Meeting of Stockholders of COR
THERAPEUTICS, INC., a Delaware corporation (the "Company"), will be held on
Tuesday, May 25, 1999 at 9:00 a.m. local time at the Embassy Suites Hotel, 250
Gateway Boulevard, South San Francisco, California for the following purposes:

1. To elect directors to serve for the ensuing year and until their
successors are elected.

2. To approve an amendment to the Company's 1991 Employee Stock
Purchase Plan to increase the aggregate number of shares of Common Stock
authorized for issuance under the plan by 400,000 shares.

3. To ratify the selection of Ernst & Young LLP as independent
auditors of the Company for its fiscal year ending December 31, 1999.

4. To transact such other business as may properly come before the
meeting or any adjournment or postponement thereof.

The foregoing items of business are more fully described in the Proxy
Statement accompanying this Notice.

The Board of Directors has fixed the close of business on Friday, April 2,
1999, as the record date for the determination of stockholders entitled to
notice of and to vote at this Annual Meeting and at any adjournment or
postponement thereof.

By Order of the Board of Directors

/s/ Patrick A. Broderick

Patrick A. Broderick
Secretary

South San Francisco, California
April 19, 1999

ALL STOCKHOLDERS ARE CORDIALLY INVITED TO ATTEND THE MEETING IN PERSON.
WHETHER OR NOT YOU EXPECT TO ATTEND THE MEETING, PLEASE COMPLETE, DATE, SIGN AND
RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN ORDER TO ENSURE YOUR
REPRESENTATION AT THE MEETING. A RETURN ENVELOPE (WHICH IS POSTAGE PREPAID IF
MAILED IN THE UNITED STATES) IS ENCLOSED FOR THAT PURPOSE. EVEN IF YOU HAVE
GIVEN YOUR PROXY, YOU MAY STILL VOTE IN PERSON IF YOU ATTEND THE MEETING. PLEASE
NOTE, HOWEVER, THAT IF YOUR SHARES ARE HELD OF RECORD BY A BROKER, BANK OR OTHER
NOMINEE AND YOU WISH TO VOTE AT THE MEETING, YOU MUST OBTAIN FROM THE RECORD
HOLDER A PROXY ISSUED IN YOUR NAME.
<PAGE> 3

COR THERAPEUTICS, INC.
256 EAST GRAND AVENUE
SOUTH SAN FRANCISCO, CA 94080
------------------------

PROXY STATEMENT

INFORMATION CONCERNING SOLICITATION AND VOTING

GENERAL

The enclosed proxy is solicited on behalf of the Board of Directors (the
"Board") of COR Therapeutics, Inc., a Delaware corporation (the "Company"), for
use at the Annual Meeting of Stockholders to be held on Tuesday, May 25, 1999,
at 9:00 a.m. local time (the "Annual Meeting"), or at any adjournment or
postponement thereof, for the purposes set forth herein and in the accompanying
Notice of Annual Meeting. The Annual Meeting will be held at the Embassy Suites
Hotel, 250 Gateway Boulevard, South San Francisco, California. The Company
intends to mail this proxy statement and accompanying proxy card on or about
April 19, 1999, to all stockholders entitled to vote at the Annual Meeting.

SOLICITATION

The Company will bear the entire cost of solicitation of proxies including
preparation, assembly, printing and mailing of this proxy statement, the proxy
and any additional information furnished to stockholders. Copies of solicitation
materials will be furnished to banks, brokerage houses, fiduciaries and
custodians holding in their names shares of the Company's common stock ("Common
Stock") beneficially owned by others to forward to such beneficial owners. The
Company may reimburse persons representing beneficial owners of Common Stock for
their costs of forwarding solicitation materials to such beneficial owners.
Original solicitation of proxies by mail may be supplemented by telephone,
facsimile or personal solicitation by directors, officers, other employees of
the Company or, at the Company's request, D.F. King & Co. No additional
compensation will be paid to directors, officers or other employees for such
services, but D.F. King & Co. will be paid its customary fee, estimated to be
approximately $4,000, if it renders solicitation services.

VOTING RIGHTS AND OUTSTANDING SHARES

Only holders of record of Common Stock at the close of business on Friday,
April 2, 1999 (the "Record Date") will be entitled to notice of and to vote at
the Annual Meeting. At the close of business on the Record Date, the Company had
outstanding and entitled to vote 24,565,235 shares of Common Stock.

Each holder of record of Common Stock on such date will be entitled to one
vote for each share held on all matters to be voted upon at the Annual Meeting.

All votes will be tabulated by the inspector of election appointed for the
meeting, who will separately tabulate affirmative and negative votes,
abstentions and broker non-votes. Abstentions will be counted towards the
tabulation of votes cast on proposals presented to the stockholders and will
have the same effect as negative votes. Broker non-votes are counted towards a
quorum, but are not counted for any purpose in determining whether a matter has
been approved.

REVOCABILITY OF PROXIES

Any person giving a proxy pursuant to this solicitation has the power to
revoke it at any time before it is voted. It may be revoked by filing with the
Secretary of the Company at the Company's principal executive office, 256 East
Grand Avenue, South San Francisco, California 94080, a written notice of
revocation or a duly executed proxy bearing a later date, or it may be revoked
by attending the meeting and voting in person. Attendance at the meeting will
not, by itself, revoke a proxy.

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STOCKHOLDER PROPOSALS

Proposals of stockholders that are intended to be presented at the
Company's annual meeting of stockholders to be held in the year 2000 must be
received by the Company no later than December 20, 1999 in order to be included
in the proxy statement and proxy relating to that annual meeting pursuant to
Rule 14-a-8 of the Securities and Exchange Commission (the "SEC"). Unless a
stockholder who wishes to bring a matter before the stockholders of the
Company's annual meeting of stockholders to be held in the year 2000 notifies
the Company of such matter prior to March 5, 2000, management will have
discretionary authority to vote all shares for which it has proxies in
opposition to such matter.

PROPOSAL 1

ELECTION OF DIRECTORS

There are eight nominees for the eight Board positions presently authorized
pursuant to the Company's Restated Bylaws ("Bylaws"). Each director to be
elected will hold office until the next annual meeting of stockholders and until
his successor is elected and has qualified, or until such director's earlier
death, resignation or removal. Each of the nominees listed below is currently a
director of the Company, all having been elected by the stockholders.

Shares represented by executed proxies will be voted, if authority to do so
is not withheld, for the election of the eight nominees named below. In the
event that any nominee should be unavailable for election as a result of an
unexpected occurrence, such shares will be voted for the election of such
substitute nominee as management may propose. Each person nominated for election
has agreed to serve if elected, and management has no reason to believe that any
nominee will be unable to serve.

Directors are elected by a plurality of the votes present in person or
represented by proxy and entitled to vote.

THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF EACH NAMED NOMINEE.

NOMINEES

The names of the nominees and certain information about them are set forth
below:

<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION/
NAME AGE POSITION HELD WITH THE COMPANY
---- --- ------------------------------
<S> <C> <C>
Vaughn M. Kailian......................... 54 President and Chief Executive Officer
Shaun R. Coughlin, M.D., Ph.D. ........... 44 Professor, School of Medicine, University of
California, San Francisco
James T. Doluisio, Ph.D.(1)............... 63 Hoechst-Roussel Professor of Pharmacy, University
of Texas at Austin
Charles J. Homcy, M.D..................... 50 Executive Vice President, Research and Development
Jerry T. Jackson(1)(2).................... 58 Retired Executive Vice President, Merck & Co.,
Inc.
Ernest Mario, Ph.D.(2).................... 60 Chairman and Chief Executive Officer, ALZA
Corporation
Robert R. Momsen(1)(2).................... 52 General Partner, InterWest Partners
Lloyd Hollingsworth Smith, Jr., M.D....... 75 Associate Dean, School of Medicine, University of
California, San Francisco
</TABLE>

- ---------------
(1) Member of the Audit Committee

(2) Member of the Compensation Committee

VAUGHN M. KAILIAN has served as President, Chief Executive Officer and a
director of the Company since March 1990. From 1967 to 1990, Mr. Kailian was
employed by Marion Merrell Dow, Inc., a pharmaceutical company, and its
predecessor companies in various general management, product develop-

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ment, marketing and sales positions. Mr. Kailian served as Corporate Vice
President of Global Commercial Development, Marion Merrell Dow, Inc.; President
and General Manager, Merrell Dow USA; Vice President, Marketing and Sales,
Merrell Dow USA; and Vice President, Marketing and Sales, Merrell Dow, Europe,
Africa and the Middle East. Mr. Kailian is also a director of Amylin
Pharmaceuticals and Axys Pharmaceuticals, Inc.

SHAUN R. COUGHLIN, M.D., PH.D., has served as a director of the Company
since September 1994. Dr. Coughlin is a Professor of Medicine and Cellular and
Molecular Pharmacology at the University of California, San Francisco ("UCSF"),
and Director of the Cardiovascular Research Institute at UCSF, where he was an
Associate Professor of Medicine from 1992 through 1996. Dr. Coughlin has acted
as a consultant to the Company since its inception. Dr. Coughlin is also a
member of the editorial boards of Trends in Cardiovascular Medicine, Molecular
Medicine and Journal of Clinical Investigation.

JAMES T. DOLUISIO, PH.D., has served as a director of the Company since
January 1994. Dr. Doluisio is the Hoechst-Roussel Professor of Pharmacy at the
University of Texas at Austin. From 1973 to 1998, he was Dean of Pharmacy at the
University of Texas at Austin. From 1990 to 1995, Dr. Doluisio served as
Chairman of the United States Pharmacopeial Convention Board of Trustees. From
1967 to 1973, Dr. Doluisio was Professor and Assistant Dean of the College of
Pharmacy at the University of Kentucky.

CHARLES J. HOMCY, M.D., has been a director of the Company since January
1998 and has served as Executive Vice President, Research and Development of the
Company since March 1995. Since 1997 Dr. Homcy has been Clinical Professor of
Medicine at the University of California, San Francisco Medical School and
Attending Physician at the San Francisco VA Hospital. From 1994 until he joined
the Company, Dr. Homcy was President of the Medical Research Division of
American Cyanamid Company-Lederle Laboratories, a pharmaceutical company (now a
division of Wyeth-Ayerst Laboratories). From 1990 until 1994, Dr. Homcy was
Executive Director of the Cardiovascular and Central Nervous System Research
Section at Lederle Laboratories, a pharmaceutical company. From 1991 to 1995,
Dr. Homcy also served as an attending physician at The Presbyterian Hospital,
College of Physicians and Surgeons, at Columbia University in New York. From
1979 to 1990, he was an attending physician at Massachusetts General Hospital
and an Associate Professor of Medicine at Harvard Medical School.

JERRY T. JACKSON has served as a director of the Company since March 1995.
Mr. Jackson was employed by Merck & Co., Inc., a pharmaceutical company
("Merck"), from 1965 until his retirement in 1995. From 1993 until his
retirement, he served as Executive Vice President of Merck. During this time, he
had responsibility for Merck's International Human Health, Worldwide Human
Vaccines, the AgVet Division, Astra/Merck U.S. Operations, as well as worldwide
marketing. During 1993, he also was President of Merck's Worldwide Human Health
Division. Mr. Jackson served as Senior Vice President of Merck from 1991 to 1992
and previously was President of Merck Sharp & Dohme International. Mr. Jackson
is also a director of Crescendo Pharmaceuticals Corporation, Molecular
Biosystems, Inc., SunPharm Corporation and Transcend Therapeutics, Inc.

ERNEST MARIO, PH.D., has served as a director of the Company since
September 1995. Dr. Mario served as Co-Chairman and Chief Executive Officer of
ALZA Corporation from July 1993 to November 1997 at which time he was promoted
to Chairman and Chief Executive Officer. From 1989 to 1993, he was President,
Deputy Chairman and Chief Executive Officer of Glaxo Holdings in London. Prior
to 1989, Dr. Mario served as President of Glaxo, Inc. in the United States. Dr.
Mario is also Chairman of Pharmaceutical Product Development, Inc. and a
director of Catalytica Inc.

ROBERT R. MOMSEN has served as a director of the Company since April 1989.
Since 1982, Mr. Momsen has been a general partner of InterWest Partners, a
venture capital management firm. Mr. Momsen is also a director of Arthrocare,
Inc., Coulter Pharmaceutical, Inc., Innovasive Devices, Inc., Integ, Inc.,
Progenitor, Inc. and Urologix, Inc.

LLOYD HOLLINGSWORTH SMITH, JR., M.D., has served as a director of the
Company since January 1993. Dr. Smith has been Associate Dean of the School of
Medicine at UCSF since 1985. From 1964 to 1985,

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he was a Professor of Medicine and Chairman of the UCSF Department of Medicine.
Dr. Smith has acted as a consultant to the Company since 1993.

BOARD COMMITTEES AND MEETINGS

During the fiscal year ended December 31, 1998, the Board held six
meetings. William H. Younger, Jr. resigned from the Board effective March 20,
1998. The Board has an Audit Committee and a Compensation Committee.

The Audit Committee meets with the Company's independent auditors at least
annually to review the results of the annual audit and discuss the financial
statements; recommends to the Board the independent auditors to be retained; and
receives and considers the auditors' comments as to financial controls, adequacy
of staff, and management performance and procedures in connection with the
annual audit and financial controls. During fiscal 1998, the Audit Committee,
composed of Messrs. Jackson, Momsen and Younger until March 20, 1998, held one
meeting, and subsequently composed of Dr. Doluisio and Messrs. Jackson and
Momsen, held one meeting.

The Compensation Committee makes recommendations to the Board concerning
salaries and incentive compensation, grants stock options and stock awards to
executive officers, employees and consultants under the Company's stock option
and award plans and otherwise determines compensation levels, and performs such
other functions regarding compensation as the Board may delegate. The
Compensation Committee, composed of Messrs. Jackson and Momsen and Dr. Mario,
held seven meetings during fiscal 1998.

During the fiscal year ended December 31, 1998, each director attended at
least 75% of the aggregate of the meetings of the Board and of the committees on
which he served, held during the period for which he was a director or committee
member, respectively.

PROPOSAL 2

APPROVAL OF AMENDMENT TO THE 1991 EMPLOYEE STOCK PURCHASE PLAN

In May 1991, the Board adopted, and the stockholders subsequently approved,
the Company's 1991 Employee Stock Purchase Plan (the "Purchase Plan"). In
November 1998, there were 650,000 shares of Common Stock reserved for issuance
under the Purchase Plan.

In November 1998, the Board amended the Purchase Plan, subject to
stockholder approval, to increase by 400,000 the number of shares of Common
Stock authorized for issuance under the Purchase Plan, from a total of 650,000
shares to a total of 1,050,000 shares. The Board adopted this amendment in order
to ensure that the Company can continue to grant purchase rights at levels
determined appropriate by the Board.

During the fiscal year ended December 31, 1998, shares of Common Stock were
purchased under the Purchase Plan in the amounts and at the weighted average
prices per share as follows: Vaughn M. Kailian, 1,518 shares ($8.29); Charles J.
Homcy, 3,021 shares ($8.51); Mark D. Perrin, 816 shares ($8.55); Laura A. Brege,
1,845 shares ($8.43); Michael M. Kitt, 2,840 shares ($8.46); all current
executive officers as a group, 10,040 shares ($8.45); and all employees
(excluding executive officers) as a group, 172,388 shares ($7.98).

As of March 1, 1999, purchase rights (net of canceled or expired purchase
rights) covering an aggregate of 536,021 shares of the Company's Common Stock
had been granted under the Purchase Plan and 113,979 shares of Common Stock
(plus any shares that might in the future be returned to the Purchase Plan as a
result of cancellations or expiration of purchase rights) remained available for
future grant under the Purchase Plan.

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Stockholders are requested in this Proposal 2 to approve the amendment to
the Purchase Plan to increase the shares available for issuance under the
Purchase Plan by 400,000 shares. The affirmative vote of the holders of a
majority of the shares present in person or represented by proxy and entitled to
vote at the meeting will be required to approve the amendment to the Purchase
Plan. Abstentions will be counted toward the tabulation of votes cast on the
proposal and will have the same effect as negative votes. Broker non-votes are
counted towards a quorum, but are not counted for any purpose in determining
whether this matter has been approved.

THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF PROPOSAL 2.

The essential features of the Purchase Plan, as amended, are outlined
below.

PURPOSE

The purpose of the Purchase Plan is to provide a means by which employees
of the Company (and any parent or subsidiary of the Company designated by the
Board to participate in the Purchase Plan) may be given an opportunity to
purchase Common Stock of the Company through payroll deductions, to assist the
Company in retaining the services of its employees, to secure and retain the
services of new employees, and to provide incentives for such persons to exert
maximum efforts for the success of the Company. All of the Company's
approximately 321 employees are eligible to participate in the Purchase Plan.

The rights to purchase Common Stock granted under the Purchase Plan are
intended to qualify as options issued under an "employee stock purchase plan" as
that term is defined in Section 423(b) of the Internal Revenue Code of 1986, as
amended (the "Code").

ADMINISTRATION

The Board administers the Purchase Plan and has the final power to construe
and interpret both the Purchase Plan and the rights granted under it. The Board
has the power, subject to the provisions of the Purchase Plan, to determine when
and how rights to purchase Common Stock of the Company will be granted, the
provisions of each offering of such rights (which need not be identical) and
whether employees of any parent or subsidiary of the Company will be eligible to
participate in the Purchase Plan.

The Board has the power to delegate administration of the Purchase Plan to
a committee composed of not fewer than two members of the Board. The Board has
delegated administration of the Purchase Plan to the Compensation Committee of
the Board. As used herein with respect to the Purchase Plan, the "Board" refers
to any committee the Board appoints to administer the Purchase Plan, as well as
to the Board itself.

OFFERINGS

The Purchase Plan is implemented by offerings of rights to all eligible
employees from time to time by the Board. Commencing in 1999, each offering will
be 12 months long and will be divided into four shorter periods approximately
three months long (an "interim period").

ELIGIBILITY

Any person who is customarily employed at least 20 hours per week and five
months per calendar year by the Company (or by any parent or subsidiary of the
Company designated by the Board) on the first day of an offering is eligible to
participate in that offering.

However, no employee is eligible to participate in the Purchase Plan if,
immediately after the grant of purchase rights, the employee would own, directly
or indirectly, stock possessing 5% or more of the total combined voting power or
value of all classes of stock of the Company or of any parent or subsidiary of
the Company (including any stock which such employee may purchase under all
outstanding rights and options). In addition, no employee may accrue the right
to purchase shares under the Purchase Plan in all employee stock purchase plans
of the Company and its affiliates at a rate that exceeds $25,000 worth of Common
Stock

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(determined at the fair market value of the shares at the time such right is
granted) for each calendar year in which such right is outstanding at any time.

PARTICIPATION IN THE PLAN

Eligible employees enroll in the Purchase Plan by delivering to the
Company, prior to the date selected by the Board as the offering date for the
offering, an agreement authorizing payroll deductions of up to 15% of such
employees' compensation during the offering.

PURCHASE PRICE

The purchase price per share at which shares of Common Stock are sold in an
offering under the Purchase Plan is the lower of (i) 85% of the fair market
value of a share of Common Stock on the first day of the offering or (ii) 85% of
the fair market value of a share of Common Stock on the relevant exercise date
(that is, the second business day following the last day of each calendar
quarter during the offering).

PAYMENT OF PURCHASE PRICE; PAYROLL DEDUCTIONS

The purchase price of the shares is accumulated by payroll deductions over
each interim period. At any time during the offering a participant may terminate
his or her payroll deductions, and at such times as the Board provides in the
offering, a participant may reduce or increase his or her payroll deductions. An
eligible employee may not begin such payroll deductions after the beginning of
an offering, except, if the Board provides, in the case of an employee who first
becomes eligible to participate as of a date specified during the offering. All
payroll deductions made for a participant are credited to his or her account
under the Purchase Plan and deposited with the general funds of the Company. A
participant may not make additional payments into such account.

PURCHASE OF STOCK

By executing an agreement to participate in the Purchase Plan, the employee
is entitled to purchase shares under the Purchase Plan. In connection with
offerings made under the Purchase Plan, the Board specifies a maximum number of
shares of Common Stock an employee may be granted the right to purchase and the
maximum aggregate number of shares of Common Stock that may be purchased
pursuant to such offering by all participants. Commencing in 1999, no employee
may purchase more than 2,000 shares of Common Stock during any given offering.
If the aggregate number of shares to be purchased upon exercise of rights
granted in the offering would exceed the maximum aggregate number of shares of
Common Stock available, the Board would make a pro rata allocation of available
shares in a uniform and equitable manner. Unless the employee's participation is
discontinued, his or her right to purchase shares is exercised automatically on
the exercise date at the applicable price. See "Withdrawal" below.

WITHDRAWAL

While each participant in the Purchase Plan is required to sign an
agreement authorizing payroll deductions, the participant may terminate payroll
deductions and withdraw from a given offering by delivering to the Company a
notice of withdrawal from the Purchase Plan. Such withdrawal may be elected at
any time prior to the end of the offering.

Upon any withdrawal from an offering by the employee, at the election of
such employee the Company will distribute to the employee his or her accumulated
payroll deductions without interest, less any accumulated deductions previously
applied to the purchase of shares of Common Stock on the employee's behalf
during such offering, and such employee's interest in the offering will be
automatically terminated. An employee's withdrawal from an offering will not
have any effect upon such employee's eligibility to participate in subsequent
offerings under the Purchase Plan.

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TERMINATION OF EMPLOYMENT

Rights granted pursuant to any offering under the Purchase Plan terminate
immediately upon cessation of an employee's employment for any reason, and the
Company will distribute to such employee all of his or her accumulated payroll
deductions, without interest, less any accumulated deductions previously applied
to the purchase of shares of Common Stock on the employee's behalf.

RESTRICTIONS ON TRANSFER

Rights granted under the Purchase Plan are not transferable and may be
exercised only by the person to whom such rights are granted.

DURATION, AMENDMENT AND TERMINATION

The Board may suspend or terminate the Purchase Plan at any time. Unless
terminated earlier, the Purchase Plan will terminate on May 13, 2001.

The Board may amend the Purchase Plan at any time. Any amendment of the
Purchase Plan must be approved by the stockholders within 12 months of its
adoption by the Board if the amendment would (i) increase the number of shares
of Common Stock reserved for issuance under the Purchase Plan, (ii) modify the
requirements relating to eligibility for participation in the Purchase Plan, or
(iii) modify any other provision of the Purchase Plan if stockholder approval is
required in order to comply with the requirements of Rule 16b-3 under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or with any
Nasdaq or securities exchange listing requirements.

Rights granted before amendment or termination of the Purchase Plan will
not be altered or impaired by any amendment or termination of the Purchase Plan
without consent of the employee to whom such rights were granted.

EFFECT OF CERTAIN CORPORATE EVENTS

In the event of a dissolution, liquidation or specified type of merger of
the Company, the Board will determine (i) whether the surviving corporation will
assume the outstanding rights under the Purchase Plan or substitute similar
rights, (ii) whether the participants' rights will continue in full force and
effect, or (iii) whether the exercise date of any ongoing offering will be
accelerated such that the outstanding rights may be exercised immediately prior
to, or concurrent with, any such event.

STOCK SUBJECT TO PURCHASE PLAN

Subject to this Proposal 2, the Board has reserved an aggregate of
1,050,000 shares of Common Stock for issuance under the Purchase Plan. If rights
granted under the Purchase Plan expire, lapse or otherwise terminate without
being exercised, the shares of Common Stock not purchased under such rights
again become available for issuance under the Purchase Plan.

FEDERAL INCOME TAX INFORMATION

Rights granted under the Purchase Plan are intended to qualify for
favorable federal income tax treatment associated with rights granted under an
employee stock purchase plan which qualifies under provisions of Section 423 of
the Code.

A participant will be taxed on amounts withheld for the purchase of shares
of Common Stock as if such amounts were actually received. Other than this, no
income will be taxable to a participant until disposition of the acquired
shares, and the method of taxation will depend upon the holding period of the
acquired shares.

If the stock is disposed of at least two years after the beginning of the
offering and at least one year after the stock is transferred to the
participant, then the lesser of (i) the excess of the fair market value of the
stock at the time of such disposition over the exercise price or (ii) the excess
of the fair market value of the stock as of the beginning of the offering period
over the exercise price (determined as of the beginning of the offering)
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will be treated as ordinary income. Any further gain or any loss will be taxed
as a long-term capital gain or loss. Such capital gains currently are generally
subject to lower tax rates than ordinary income.

If the stock is sold or disposed of before the expiration of either of the
holding periods described above, then the excess of the fair market value of the
stock on the exercise date over the exercise price will be treated as ordinary
income at the time of such disposition. The balance of any gain will be treated
as capital gain. Even if the stock is later disposed of for less than its fair
market value on the exercise date, the same amount of ordinary income is
attributed to the participant, and a capital loss is recognized equal to the
difference between the sales price and the fair market value of the stock on
such exercise date. Any capital gain or loss will be short-term or long-term,
depending on how long the stock has been held.

There are no federal income tax consequences to the Company by reason of
the grant or exercise of rights under the Purchase Plan. The Company is entitled
to a deduction to the extent amounts are taxed as ordinary income to a
participant (subject to the requirement of reasonableness and the satisfaction
of tax reporting obligations).

PROPOSAL 3

RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS

The Board has selected Ernst & Young LLP as the Company's independent
auditors for the fiscal year ending December 31, 1999 and has further directed
that management submit the selection of independent auditors for ratification by
the stockholders at the Annual Meeting. Ernst & Young LLP has audited the
Company's financial statements since its inception in 1988. Representatives of
Ernst & Young LLP are expected to be present at the Annual Meeting, will have an
opportunity to make a statement, if they so desire, and will be available to
respond to appropriate questions.

Stockholder ratification of the selection of Ernst & Young LLP as the
Company's independent auditors is not required by the Company's Bylaws or
otherwise. However, the Board is submitting the selection of Ernst & Young LLP
to the stockholders for ratification as a matter of good corporate practice. If
the stockholders fail to ratify the selection, the Audit Committee and the Board
will reconsider whether or not to retain that firm. Even if the selection is
ratified, the Audit Committee and the Board in its discretion may direct the
appointment of different independent auditors at any time during the year if it
determines that such a change would be in the best interests of the Company and
its stockholders.

The affirmative vote of the holders of a majority of the shares present in
person or represented by proxy and entitled to vote on the proposal at the
meeting will be required to ratify the selection of Ernst & Young LLP.
Abstentions will be counted toward the tabulation of votes cast on the proposal
and will have the same effect as negative votes. Broker non-votes are counted
towards a quorum, but are not counted for any purpose in determining whether
this matter has been approved.

THE BOARD OF DIRECTORS RECOMMENDS
A VOTE IN FAVOR OF PROPOSAL 3.

8
<PAGE> 11

SECURITY OWNERSHIP OF
CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

The following table sets forth certain information regarding the ownership
of the Company's Common Stock as of March 1, 1999 by (i) each nominee for
director, (ii) each of the executive officers named in the Summary Compensation
Table, (iii) all executive officers and directors of the Company as a group, and
(iv) all those known by the Company to be beneficial owners of more than five
percent of its Common Stock.

<TABLE>
<CAPTION>
BENEFICIAL
OWNERSHIP(1)(2)
---------------------
NUMBER PERCENT
BENEFICIAL OWNER OF SHARES OF TOTAL
---------------- --------- --------
<S> <C> <C>
Capital Guardian Trust Company(3)........................... 2,157,600 8.8%
11100 Santa Monica Boulevard
Los Angeles, CA 90025
State of Wisconsin Investment Board(4)...................... 1,783,400 7.3%
P. O. Box 7842
Madison, WI 53707
T. Rowe Price Associates, Inc.(5)........................... 1,638,179 6.7%
100 East Pratt Street
Baltimore, MD 21202
Wellington Management Company, LLP(6)....................... 1,306,000 5.3%
75 State Street
Boston, MA 02109
Vaughn M. Kailian........................................... 599,807 2.4%
Robert R. Momsen(7)......................................... 559,829 2.3%
Charles J. Homcy............................................ 212,516 *
Laura A. Brege.............................................. 212,493 *
Mark D. Perrin.............................................. 165,180 *
Michael M. Kitt............................................. 147,949 *
Shaun R. Coughlin........................................... 84,922 *
James T. Doluisio........................................... 26,000 *
Jerry T. Jackson............................................ 25,416 *
Lloyd Hollingsworth Smith, Jr. ............................. 25,000 *
Ernest Mario................................................ 17,916 *
All executive officers and directors as a group (13
people)(8)................................................ 2,112,837 8.2%
</TABLE>

- ---------------
* Less than one percent

(1) This table is based upon information supplied by officers, directors and
principal stockholders and Schedule 13G filed with the SEC. Unless otherwise
indicated in the footnotes to this table and subject to community property
laws where applicable, each of the stockholders named in this table has sole
voting and investment power with respect to the shares indicated as
beneficially owned. Applicable percentages are based on 24,474,880 shares
outstanding on March 1, 1999, adjusted as required by rules promulgated by
the SEC.

(2) Includes shares that certain officers and directors of the Company have the
right to acquire within 60 days after the date of this table pursuant to
outstanding options as follows (number of shares): Vaughn M. Kailian,
506,211; Robert R. Momsen, 25,000; Charles J. Homcy, 195,619; Laura A.
Brege, 205,043; Mark D. Perrin, 155,125; Michael M. Kitt, 133,511; Shaun R.
Coughlin, 59,921; James T. Doluisio, 25,000; Jerry T. Jackson, 20,416; Lloyd
Hollingsworth Smith, Jr., 25,000; Ernest Mario, 17,916; and all executive
officers and directors as a group, 1,395,428.

(3) Based on a Schedule 13G filed with the SEC on February 8, 1999. Includes
2,157,600 shares beneficially owned by Capital Guardian Trust Company
("CGTC") as a result of acting as investment manager of various
institutional accounts, with dispositive power over 2,157,600 shares and
power to direct the voting

9
<PAGE> 12

of 1,667,000 shares on behalf of various individual and institutional
investors. CGTC disclaims beneficial ownership of all of the these shares
pursuant to Rule 13d-4.

(4) Based on a Schedule 13G filed with the SEC on February 4, 1999. The State of
Wisconsin Investment Board retains sole voting and dispositive power for all
shares.

(5) Based on a Schedule 13G filed with the SEC on February 12, 1999. Includes
1,638,179 shares beneficially owned by T. Rowe Price Associates, Inc. as a
result of acting as investment advisor, with shared dispositive power over
1,638,179 shares and shared power to direct the voting of 338,824 shares on
behalf of various individual and institutional investors. T. Rowe Price
Associates, Inc. disclaims beneficial ownership of all of these shares.

(6) Based on a Schedule 13G filed with the SEC on February 8, 1999. Includes
1,306,000 shares beneficially owned by Wellington Management Company, LLP as
a result of acting as investment advisor, with shared dispositive power over
1,306,000 shares and shared power to direct the voting of 749,900 shares on
behalf of various individual and institutional investors.

(7) Includes 484,800 shares owned by InterWest Partners VI, LP and 15,200 shares
owned by InterWest Investors VI, LP, the general partner of each of which is
InterWest Management Partners VI, LLC. Mr. Momsen is a Managing Director of
InterWest Management Partners VI, LLC and disclaims beneficial ownership of
such 500,000 shares held by such limited partnerships, except to the extent
of his pecuniary interest therein.

(8) Includes 1,395,428 shares that certain officers and directors of the Company
have the right to acquire within 60 days after the date of this table
pursuant to outstanding options.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Exchange Act requires the Company's directors and
executive officers and persons who own more than 10% of a registered class of
the Company's equity securities to file with the SEC initial reports of
ownership and reports of changes in ownership of Common Stock and other equity
securities of the Company. Officers, directors and greater than 10% stockholders
are required by the SEC regulations to furnish the Company with copies of all
Section 16(a) forms they file.

To the Company's knowledge, based solely on a review of the copies of such
reports furnished to the Company and written representations that no other
reports were required, during the fiscal year ended December 31, 1998, its
officers, directors and greater than 10% beneficial owners complied with all
applicable Section 16(a) filing requirements.

EXECUTIVE COMPENSATION

COMPENSATION OF DIRECTORS

Directors who are neither employees of nor consultants to the Company
("non-employee directors") receive an annual directors' fee of $10,000, paid on
a quarterly basis. In accordance with Company policy, directors may also be
reimbursed for certain expenses in connection with attendance at Board and
committee meetings. An aggregate of $40,000 was paid to Dr. Doluisio, Mr.
Jackson, Dr. Mario and Mr. Momsen for services as directors of the Company
during 1998.

In January 1994, the Board adopted, and the stockholders subsequently
approved, the Company's 1994 Non-Employee Directors' Stock Option Plan (the
"Directors' Plan"). Under the Directors' Plan, each non-employee director of the
Company is automatically granted a non-qualified option to purchase 25,000
shares of Common Stock on the date of adoption of the Directors' Plan, or if
later, the date of such non-employee director's election to the Board. The
exercise price of such options granted under the Director's Plan is 100% of the
fair market value of the Common Stock on the date of the option grant. Such
options granted under the Directors' Plan vest ratably over 60 months and have a
term of ten years. During 1998, no options to purchase shares were granted to
non-employee directors for services rendered as directors of the Company during
1998.

10
<PAGE> 13

In March 1999, the Board approved an amendment to the Directors' Plan (the
"Plan Amendment") to provide for automatic supplemental grants of stock options
to each non-employee director of the Company who has completed three or more
years of service as a director of the Company (each, an "Eligible Director").
Pursuant to the Plan Amendment, each Eligible Director will automatically be
granted a non-qualified option to purchase 10,000 shares of Common Stock on the
date of the first Board meeting held both (i) on or after the date of the
adoption of the Plan Amendment and (ii) after the date on which the Eligible
Director has completed three years of service as a director of the Company, and
biannually thereafter. The exercise price of stock options granted pursuant to
the Plan Amendment is 100% of the fair market value of the Common Stock on the
date of the option grant. Options granted pursuant to the Plan Amendment are
fully vested on the date of grant and have a maximum term of ten years.

The Board approved the Plan Amendment after reviewing the Directors' Plan
and consulting with its outside counsel with respect to competitive stock option
grants, both as to the size and timing of the grants, in order to assist the
Company to retain the services of its non-employee directors and to provide
incentives and rewards for such persons to exert maximum efforts for the success
of the Company. The Company also subsequently received independent confirmation
from an outside compensation consulting firm as to the Plan Amendment with
respect to the competitive appropriateness of the size and timing of the option
grants. Each of the Company's non-employee directors, Drs. Coughlin, Doluisio,
Mario and Smith and Messrs. Jackson and Momsen, will receive a 10,000 share
grant in 1999 pursuant to the Plan Amendment.

In 1988, the Company and Dr. Coughlin entered into a consulting agreement
which provided that, among other things, Dr. Coughlin would perform consulting
services for the Company. Dr. Coughlin receives $1,666 per month for his
services as a consultant to the Company. The Company pays Dr. Coughlin's
consulting fee directly to UCSF on behalf of Dr. Coughlin. During 1998, UCSF
received payments totaling $20,000 on behalf of Dr. Coughlin.

In January 1993, the Company and Dr. Smith entered into a consulting
agreement which provides, among other things, that Dr. Smith will perform
consulting services for the Company for ten days each year during the five-year
term of the consulting agreement. In consideration of such services, the Company
is to pay Dr. Smith $1,000 per consulting day, which amount is to be paid in
arrears on the last day of each calendar quarter. Dr. Smith received payments
totaling $10,000 for services rendered during 1998 pursuant to the agreement.

11
<PAGE> 14

COMPENSATION OF EXECUTIVE OFFICERS

SUMMARY OF COMPENSATION

The following table shows, for the fiscal years ended December 31, 1998,
1997 and 1996, compensation awarded or paid to, or earned by, the Company's
Chief Executive Officer and its four other most highly compensated officers (the
"Named Executive Officers") at December 31, 1998.

SUMMARY COMPENSATION TABLE

<TABLE>
<CAPTION>
LONG-TERM
COMPENSATION AWARDS
ANNUAL COMPENSATION -----------------------
--------------------------------------- RESTRICTED
OTHER ANNUAL STOCK SECURITIES ALL OTHER
SALARY BONUS COMPENSATION AWARDS UNDERLYING COMPENSATION
NAME AND PRINCIPAL POSITION YEAR ($)(1) ($)(2) ($)(3) ($)(4) OPTIONS(#) ($)(5)
--------------------------- ---- ------- ------- ------------ ---------- ---------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Vaughn M. Kailian.............. 1998 427,500 102,600 43,000 40,000 3,762
President and Chief 1997 400,000 128,000 110,500 1,940
Executive Officer 1996 394,167 100,000 1,440
Charles J. Homcy............... 1998 327,917 59,025 33,000 30,000 3,330
Executive Vice President, 1997 305,000 73,200 167,629(6) 101,500 709
Research and Development 1996 302,917 21,966(6) 20,000 209
Mark D. Perrin................. 1998 290,167 52,230 29,200 30,000 1,444
Executive Vice President, 1997 270,000 64,800 193,874(7) 93,500 500
Commercial Operations 1996 270,000 29,959(7) 10,000 500
Laura A. Brege................. 1998 245,833 44,250 25,000 25,000 1,380
Senior Vice President,
Finance 1997 200,000 48,000 69,500 1,214
and Chief Financial Officer 1996 198,917 60,000 962
Michael M. Kitt................ 1998 226,127 33,325 22,878 10,000 1,841
Vice President, Clinical 1997 212,760 27,233 21,959 40,500 1,807
Research 1996 211,447 20,000 1,307
</TABLE>

- ---------------
(1) Includes amounts earned but deferred at the election of the Named Executive
Officer.

(2) Bonus payments for 1998 (paid in March 1999) are equal to the following
percentages of annual compensation earned pursuant to the Company's
Incentive Pay Program: 24% for Mr. Kailian; 18% for Dr. Homcy, Mr. Perrin
and Mrs. Brege; and 14.7% for Dr. Kitt. Bonus payments for 1997 are equal to
the following percentages of annual compensation earned pursuant to the
Company's Incentive Pay Program: 32% for Mr. Kailian; 24% for Dr. Homcy, Mr.
Perrin and Mrs. Brege; and 12.8% for Dr. Kitt. These bonuses do not include
the value of restricted stock bonus awards granted, which are included under
the heading "Restricted Stock Awards" in this table.

(3) As permitted by rules promulgated by the SEC, no amounts are shown with
respect to "perquisites" under "Other Annual Compensation" where such
amounts for each Named Executive Officer do not exceed the lesser of 10% of
such executive's bonus plus salary or $50,000.

(4) Represents the dollar value of the shares awarded. This number is calculated
by multiplying the fair market value on the date of grant ($7.97 in 1998 and
$12.66 in 1997, based on the average of the high and low sale prices on the
date of grant as reported on the Nasdaq National Market) by the number of
shares granted. Restricted shares granted to all Named Executive Officers in
1998 vest in full on January 1, 2000. Restricted shares granted to Dr. Kitt
in 1997 vest annually over three years from the date of grant. At the end of
fiscal 1998, the aggregate unvested restricted stock holdings of the Named
Executive Officers and the value thereof at year end based on the then fair
market value of $12.75, without giving effect to the diminution of value
attributable to the restrictions on such stock, were as follows: $77,189 for
Mr. Kailian (6,054 shares), $58,752 for Dr. Homcy (4,608 shares), $47,456
for Mr. Perrin (3,722 shares), $44,740 for Mrs. Brege (3,509 shares), and
$63,737 for Dr. Kitt (4,999 shares). Dividends on these shares of restricted
stock will be paid when, as, and if declared by the Company's Board of
Directors. To date, the Company has not paid any dividends and does not
anticipate paying any dividends on its Common Stock in the foreseeable
future.

12
<PAGE> 15

(5) Includes premiums on life insurance payable for each Named Executive
Officer. Also, includes $500 in matching contributions by the Company to its
tax-qualified employee savings and retirement plans for all Named Executive
Officers in 1998 and 1997; and Mr. Perrin and Mrs. Brege in 1996.

(6) Consists of reimbursement of expenses paid by the Company in connection with
Dr. Homcy's relocation.

(7) Consists of reimbursement of expenses paid by the Company in connection with
Mr. Perrin's relocation.

STOCK OPTION GRANTS AND EXERCISES

The Company has granted stock options to its executive officers, employees
and consultants under its 1988 Employee Stock Option Plan (the "1988 Employee
Plan"), its 1991 Equity Incentive Plan (the "1991 Equity Plan") and its 1998
Non-Officer Equity Incentive Plan (the "1998 Equity Plan"), and to consultants
under its 1988 Consultant Stock Option Plan (the "1988 Consultant Plan"). As of
March 1, 1999, options to purchase 299,151 shares were outstanding under the
1988 Employee Plan and options to purchase 59,167 shares were outstanding under
the 1988 Consultant Plan. Both of these plans were terminated in 1991. As of
March 1, 1999, options to purchase 4,054,857 shares were outstanding under the
1991 Equity Plan, and 341,439 shares remained available for future grants. As of
March 1, 1999, options to purchase 558,650 shares were outstanding under the
1998 Equity Plan, and 274,607 shares remained available for future grants.

On February 27, 1998 the Board adopted the 1998 Equity Plan with 300,000
shares of Common Stock authorized for issuance under the plan. Subsequently, the
Board authorized an additional 550,000 shares for issuance under the plan. The
1998 Equity Plan provides for the grant of non-statutory stock options at fair
market value to employees of or consultants to the Company who are neither
officers nor directors of the Company. As of March 1, 1999, options to purchase
558,650 shares of Common Stock were outstanding under the plan, and 274,607
shares remained available for future grants under the plan. The 1998 Equity Plan
was adopted (i) to provide a means by which selected employees of and
consultants to the Company could be given an opportunity to purchase stock in
the Company, (ii) to assist in securing and retaining the services of persons
capable of filling such positions, and (iii) to provide incentives to such
persons to exert maximum efforts for the success of the Company.

The following tables show, for the fiscal year ended December 31, 1998,
certain information regarding all options granted to, exercised by, and held at
year end by, the Named Executive Officers.

OPTION GRANTS IN LAST FISCAL YEAR

<TABLE>
<CAPTION>
INDIVIDUAL GRANTS
----------------------------------------------------- POTENTIAL REALIZABLE
NUMBER OF PERCENTAGE VALUE AT ASSUMED
SECURITIES OF TOTAL OPTIONS ANNUAL RATES OF STOCK
UNDERLYING GRANTED TO PRICE APPRECIATION FOR
OPTIONS EMPLOYEES IN EXERCISE OPTION TERM($)(3)
GRANTED FISCAL YEAR PRICE EXPIRATION -----------------------
NAME (#)(1) (%)(2) ($/SH) DATE 5% 10%
---- ---------- ---------------- -------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C>
Vaughn M. Kailian............. 40,000 5.47 12.81 2/27/08 322,309 816,793
Charles J. Homcy.............. 30,000 4.10 12.81 2/27/08 241,731 612,595
Mark D. Perrin................ 30,000 4.10 12.81 2/27/08 241,731 612,595
Laura A. Brege................ 25,000 3.42 12.81 2/27/08 201,443 510,496
Michael M. Kitt............... 10,000 1.37 12.81 2/27/08 80,577 204,198
</TABLE>

- ---------------
(1) Reflects options granted in 1998 to the Named Executive Officers under the
1991 Equity Plan. Options granted to Mr. Kailian, Dr. Homcy, Mr. Perrin and
Mrs. Brege vest in their entirety on January 31, 2001. The option granted to
Dr. Kitt vests in equal monthly installments over a five-year period
following the date of grant, which is generally consistent with the terms of
options granted to other employees under the 1991 Equity Plan. The 1991
Equity Plan also contains provisions for the Board of Directors, among other
things, to reprice options and to accelerate vesting of options in the event
of a change in control of the Company.

13
<PAGE> 16

(2) Based on options to purchase 731,750 shares of Common Stock granted to
employees, including executive officers, in the fiscal year ended December
31, 1998.

(3) The potential realizable value is based on the term of the option at the
date of the grant (10 years). It is calculated by assuming that the stock
price on the date of grant appreciates at the indicated annual rate,
compounded annually for the entire term, and that the option is exercised
and sold on the last day of the option term for the appreciated stock price.
These amounts represent certain assumed rates of appreciation only and do
not reflect the Company's estimate or projection of future stock price
performance. Actual gains, if any, are dependent on the actual future
performance of the Common Stock. There can be no assurance that the amounts
reflected in this table will be achieved.

AGGREGATED OPTION EXERCISES
IN LAST FISCAL YEAR, AND FISCAL YEAR-END OPTION VALUES

<TABLE>
<CAPTION>
NUMBER OF SECURITIES VALUE OF UNEXERCISED
SHARES UNDERLYING UNEXERCISED IN-THE-MONEY OPTIONS
ACQUIRED ON VALUE OPTIONS AT FY-END AT FY-END
EXERCISE REALIZED EXERCISABLE/UNEXERCISABLE EXERCISABLE/UNEXERCISABLE
NAME (#) ($) (#) ($)(2)
---- ----------- -------- ------------------------- -------------------------
<S> <C> <C> <C> <C>
Vaughn M. Kailian............. 5,000 89,875(1) 399,015/246,485 2,293,896/608,323
Charles J. Homcy.............. -- -- 155,851/170,649 53,461/249,007
Mark D. Perrin................ -- -- 126,558/181,942 171,360/296,421
Laura A. Brege................ -- -- 138,676/145,824 26,521/365,698
Michael M. Kitt............... -- -- 126,677/ 43,823 50,839/ 36,755
</TABLE>

- ---------------
(1) Fair market value of the Common Stock on the date of exercise ($18.28, based
on the average of the high and the low sale prices as reported on the Nasdaq
National Market) less the exercise price and multiplied by the number of
shares exercised.

(2) Fair market value of the Common Stock on December 31, 1998 ($12.75, based on
the average of the high and the low sale prices as reported on the Nasdaq
National Market) less the exercise price and multiplied by the number of
shares that are in the money.

COMPENSATION COMMITTEE REPORT(1)

The Compensation Committee (the "Committee") consists of Jerry T. Jackson,
Ernest Mario, Ph.D. and Robert R. Momsen, none of whom is an employee of or a
consultant to the Company. The Committee is responsible for setting the
Company's policies regarding compensation for all employees and executive
officers and for administering the Company's 1991 Equity Plan, 1998 Equity Plan
and Purchase Plan. In particular, the Committee evaluates the performance of
management and determines the compensation of executive officers.

The Company's executive compensation philosophy is to attract and retain
executive officers capable of leading the Company to fulfillment of its business
objectives by offering competitive compensation opportunities that reward
individual contributions as well as corporate performance. Accordingly, the
Company's executive compensation policies include:

- competitive pay practices, taking into account the pay practices of life
science and pharmaceutical companies with which the Company competes for
talented executives, with special weight to California companies of
comparable size;

- ---------------

(1) The material in this report is not "soliciting material," is not deemed
"filed" with the SEC and is not to be incorporated by reference in any
filing of the Company under the Securities Act of 1933, as amended, or the
Exchange Act, whether made before or after the date hereof and irrespective
of any general incorporation language in any such filing.
14
<PAGE> 17

- annual incentive programs which are designed to encourage executives to
focus on the achievement of specific short-term strategic goals, as well
as longer-term corporate objectives; and

- equity-based incentives designed to motivate executives over the long
term, to align the interests of management and stockholders and to ensure
that management is appropriately rewarded for benefits which it achieves
for the Company's stockholders.

Total compensation for the Company's executive officers includes a base
salary component and may include two other components: annual incentives and
long-term incentives. Annual incentive compensation may consist of cash
incentive bonuses and stock bonus or restricted stock bonus awards, or other
equity components, each based on satisfying corporate goals established for the
year by the Committee as well as on meeting individual performance objectives.
In addition, executive officers of the Company may receive long-term incentive
compensation in the form of grants of options to purchase shares of Common
Stock, with exercise prices typically set at fair market value on the date of
grant. Restricted stock bonus awards may also provide long-term incentives for
executives.

In the biopharmaceutical industry, traditional measures of corporate
performance, such as earnings per share or sales growth, may not readily apply
in reviewing performance of executives. In addition to traditional measures of
performance, in determining the compensation of the Company's executives, the
Committee looks to other indicia of performance, such as the progress of the
Company's research and development programs, regulatory developments and
corporate development activities, as well as the Company's success in securing
capital sufficient to assist the Company in completing product development and
increasing product revenues.

As a result, in many instances these qualitative factors necessarily
involve a subjective assessment by the Committee of corporate performance.
Moreover, the Committee does not base its considerations on any single
performance factor nor does it specifically assign relative weights to factors,
but rather considers a mix of factors and evaluates both Company and individual
performance against that mix. In addition, total compensation paid by the
Company to its executive officers is designed to be comparable to compensation
packages paid to the management of other companies of comparable size in the
biopharmaceutical industry. Toward that end, the Committee may review both
independent survey data as well as data gathered internally.

In January 1998, the Committee met to consider the compensation of the
Company's executive officers for fiscal 1998. The Committee considered a variety
of factors, including both individual and corporate factors, in evaluating the
performance of the Company's executive officers. The Committee reviewed the
results of independent surveys that provided information regarding management
compensation for approximately 200 companies in the biopharmaceutical industry,
categorized by geographic area and management position. The surveys included a
broader group of companies than those companies included in the American Stock
Exchange Biotechnology Index used in the performance measurement comparison
graph included in this proxy statement. The Committee also reviewed other
publicly available information, gathered informally, pertaining to compensation
of executive officers in the biopharmaceutical industry. Based on these survey
results, as well as the other foregoing factors, for 1998, the Committee
determined that the base compensation of Mr. Kailian should be increased by 8%
and the other executive officers' base compensation should be increased by
between 8% and 25%.

The Company has used the grant of stock options under its 1991 Equity Plan
to underscore the common interests of stockholders and management. Options
granted to executive officers are intended to provide a continuing financial
incentive to maximize long-term value to stockholders and to help make the
executive's total compensation opportunity competitive. In addition, because
stock options generally become exercisable over a period of several years,
options encourage executives to remain in the long-term employ of the Company.
In determining the size of an option to be granted to an executive officer, the
Committee takes into account the officer's position and level of responsibility
within the Company, the officer's existing stock and unvested option holdings,
and the potential reward to the officer if the stock price appreciates in the
public market. Based on these factors, in February 1998, the Committee granted
to Mr. Kailian options to purchase an aggregate of 40,000 shares of Common
Stock, at an exercise price of $12.81 per share, the fair market value on the
date of the grant. This option granted to Mr. Kailian vests entirely in January
2001. In October 1998,
15
<PAGE> 18

the Committee granted to Mr. Kailian a restricted stock award of 5,396 shares.
This restricted stock award vests in its entirety in January 2000. The Committee
granted to each of the other executive officers of the Company options to
purchase between 25,000 and 30,000 shares of Common Stock at an exercise price
of $12.81 per share, the fair market value on the date of the grants. The
options granted to the other executive officers vest in their entirety in
January 2001. In October 1998, the Committee also granted to each of the other
executive officers of the Company restricted stock awards ranging from 3,137 to
4,141 shares. These restricted stock awards vest in their entirety in January
2000. The Committee considered the number of shares and options already received
by each executive officer in making these grants.

The Committee also approved a 1998 Incentive Pay Program for executive
officer pay, which provides for the payment of cash bonuses to the executive
officers. Mr. Kailian was eligible to receive a cash bonus at target of up to
40% of his eligible 1998 compensation, and the other executive officers were
each eligible to receive a cash bonus at target of up to 30% of such officer's
eligible 1998 compensation, if the Company achieved its goals for 1998.
Determinations of the amount of cash bonuses eligible to be awarded under the
1998 Incentive Pay Program were based on the extent of achievement of certain
corporate goals established by the Board for 1998. The goals established for the
1998 Incentive Pay Program were: (i) approval and launch of
INTEGRILIN(TM)(eptifibatide) Injection, (ii) advancement of other potential
products in research and development, specifically the Oral GP IIb-IIIa product
candidate, and (iii) financial, operational and general corporate management
objectives.

In January 1999, the Committee met to evaluate performance against the
goals established for the 1998 Incentive Pay Program. The Committee determined
that, although not all 1998 corporate objectives were fully satisfied, the
Company had success in achieving most of its objectives. As a result, based on
corporate performance, the Committee recommended that Mr. Kailian receive a cash
bonus of 24% of his eligible compensation, and that the other executive officers
of the Company receive cash bonuses of 18% of such officer's eligible 1998
compensation.

The Committee has not adopted a policy with respect to the application of
Section 162(m) of the Internal Revenue Service Code of 1986, as amended, which
generally imposes an annual corporate deduction limitation of $1,000,000 on the
compensation of certain executive officers. However, pursuant to Section 162(m),
compensation from options granted under the 1991 Equity Plan at no less than
100% of fair market value may be excluded from the Section 162(m) limitations.

Jerry T. Jackson Ernest Mario, Ph.D. Robert R. Momsen

16
<PAGE> 19

PERFORMANCE MEASUREMENT COMPARISON(1)

The following graph shows total stockholder return of the CRSP Total Return
Index for the Company, the American Stock Exchange Biotechnology Index ("AMEX
Index") and the Nasdaq Stock Market (United States Companies) ("Nasdaq Index").

COMPARISON OF TOTAL CUMULATIVE RETURN ON INVESTMENT(2)

<TABLE>
<CAPTION>
COR AMEX NASDAQ
--- ---- ------
<S> <C> <C> <C>
12/31/93 100.000 100.000 100.000
1/31/94 104.130 104.730 103.050
2/28/94 89.260 94.150 102.020
3/31/94 78.510 79.480 95.710
4/30/94 80.990 75.170 94.470
5/31/94 61.980 81.080 94.640
6/30/94 77.690 69.100 90.880
7/31/94 80.990 68.650 92.970
8/31/94 97.520 83.240 98.560
9/30/94 100.830 78.610 98.390
10/31/94 89.950 72.340 100.090
11/30/94 88.430 73.330 96.590
12/31/94 72.730 70.880 96.800
1/31/95 89.950 69.870 97.220
2/28/95 89.260 71.650 102.180
3/31/95 89.950 66.990 105.200
4/30/95 109.090 69.230 108.650
5/31/95 102.480 67.160 111.300
6/30/95 59.090 77.680 120.170
7/31/95 66.940 84.310 128.890
8/31/95 76.860 95.490 131.320
9/30/95 73.550 98.630 134.340
10/31/95 68.600 90.530 133.380
11/30/95 72.730 94.080 136.350
12/31/95 55.370 115.540 135.440
1/31/96 68.600 124.630 136.430
2/29/96 69.010 119.560 141.610
3/31/96 76.860 116.450 141.790
4/30/96 70.250 129.240 153.260
5/31/96 66.940 134.440 160.070
6/30/96 75.210 121.510 152.550
7/31/96 50.410 100.350 139.110
8/31/96 64.880 111.080 146.950
9/30/96 66.120 120.940 157.950
10/31/96 59.500 114.480 157.250
11/30/96 70.250 116.480 166.400
12/31/96 65.290 124.630 166.200
1/31/97 90.080 143.490 177.630
2/28/97 81.400 141.430 168.510
3/31/97 62.810 120.520 157.270
4/30/97 50.410 113.400 162.300
5/31/97 59.090 128.540 180.270
6/30/97 70.250 123.100 185.640
7/31/97 71.070 119.220 205.180
8/31/97 109.090 131.590 204.340
9/30/97 109.920 152.470 217.000
10/31/97 147.520 146.230 205.150
11/30/97 150.410 142.923 206.040
12/31/97 148.760 140.280 202.160
1/31/98 64.050 135.980 208.470
2/28/98 83.470 138.800 227.920
3/31/98 81.820 150.770 236.310
4/30/98 124.790 151.290 240.530
5/31/98 113.640 139.290 229.000
6/30/98 91.740 126.830 243.920
7/31/98 92.560 119.170 241.040
8/31/98 63.020 90.270 193.000
9/30/98 51.240 120.390 218.050
10/31/98 79.750 141.730 228.040
11/30/98 77.690 141.330 250.970
12/31/98 87.600 159.900 282.270
</TABLE>

- ---------------
(1) This section is not "soliciting material," is not deemed "filed" with the
SEC and is not to be incorporated by reference in any filing of the Company
under the Securities Act of 1933, as amended, or the Exchange Act, whether
made before or after the date hereof and irrespective of any general
incorporation language in any such filing.

(2) The total return on investment (change in stock price plus reinvested
dividends) for the Company, the AMEX Index and the Nasdaq Index, based on
December 31, 1993 = $100. The AMEX Index is calculated using an equal-dollar
weighting methodology.

CERTAIN TRANSACTIONS

The Company has entered into indemnity agreements with certain officers and
directors which provide, among other things, that the Company will indemnify
such officer or director, under the circumstances and to the extent provided for
therein, for expenses, damages, judgments, fines and settlements he or she may
be required to pay in actions or proceedings to which he or she is or may be
made a party by reason of his or her position as a director, officer or other
agent of the Company, and otherwise to the fullest extent permitted under
Delaware law and the Company's Bylaws. See also "Executive
Compensation -- Compensation of Directors."

17
<PAGE> 20

OTHER MATTERS

The Board of Directors knows of no other matters that will be presented for
consideration at the Annual Meeting. If any other matters are properly brought
before the meeting, it is the intention of the persons named in the accompanying
proxy to vote on such matters in accordance with their best judgment.

By Order of the Board of Directors

/s/ Patrick A. Broderick

Patrick A. Broderick
Secretary
April 19, 1999

A COPY OF THE COMPANY'S ANNUAL REPORT TO THE SEC ON FORM 10-K FOR THE
FISCAL YEAR ENDED DECEMBER 31, 1998 IS AVAILABLE WITHOUT CHARGE UPON WRITTEN
REQUEST TO: INVESTOR RELATIONS, COR THERAPEUTICS, INC., 256 EAST GRAND AVENUE,
SOUTH SAN FRANCISCO, CA 94080. A COPY OF THE REPORT CAN ALSO BE VIEWED BY
VISITING THE COMPANY'S WEB SITE, HTTP://WWW.CORR.COM.

18
<PAGE> 21

PROXY

COR THERAPEUTICS, INC.

PROXY SOLICITED BY THE BOARD OF DIRECTORS
FOR THE ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON MAY 25, 1999

The undersigned hereby appoints Vaughn M. Kailian and Laura A. Brege, and each
of them as attorneys and proxies of the undersigned, with full power of
substitution, to vote all of the shares of stock of COR Therapeutics, Inc. which
the undersigned may be entitled to vote at the Annual Meeting of Stockholders of
COR Therapeutics, Inc. to be held at the Embassy Suites Hotel, 250 Gateway
Boulevard, South San Francisco, California, on Tuesday, May 25, 1999 at 9:00
a.m. local time, and at any and all postponements, continuations, and
adjournments thereof, with all powers that the undersigned would possess if
personally present, upon and in respect of the following matters and in
accordance with the following instructions, with discretionary authority as to
any and all other matters that may properly come before the meeting.

UNLESS A CONTRARY DIRECTION IS INDICATED, THIS PROXY WILL BE VOTED FOR ALL
NOMINEES LISTED IN PROPOSAL 1 AND FOR PROPOSAL 2 AND PROPOSAL 3 AS MORE
SPECIFICALLY DESCRIBED IN THE PROXY STATEMENT. IF SPECIFIC INSTRUCTIONS ARE
INDICATED, THIS PROXY WILL BE VOTED IN ACCORDANCE THEREWITH.

(Continued and to be signed on other side.)

- --------------------------------------------------------------------------------
- FOLD AND DETACH HERE -
<PAGE> 22
<TABLE>

<S> <C> <C> <C> <C>
Please mark
your votes as
indicated in /X/
this example.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE NOMINEES THE BOARD OF DIRECTORS RECOMMENDS A VOTE
FOR DIRECTOR LISTED BELOW. FOR PROPOSAL 2 AND FOR PROPOSAL 3.

PROPOSAL 1: FOR WITHHOLD PROPOSAL 2: FOR AGAINST ABSTAIN
all nominees listed AUTHORITY To approve an amendment to the Company's / / / / / /
(except as marked to the to vote for all 1991 Employee Stock Purchase Plan to
contrary below) nominees listed below increase the aggregate number of shares
/ / / / of Common Stock authorized for issuance
under the plan by 400,000 shares.
To elect directors to hold office until the next
Annual Meeting of Stockholders and until their PROPOSAL 3: FOR AGAINST ABSTAIN
successors are elected. To ratify the selection of Ernst & Young / / / / / /
LLP as independent auditors of the Company
Nominees: Vaughn M. Kailian, Shaun R. Coughlin, for its fiscal year ending December 31, 1999.
James T. Doluisio, Charles J. Homcy,
Jerry T. Jackson, Ernest Mario, Robert R.
Momsen, and Lloyd Hollingsworth Smith, Jr.

To withhold authority to vote for any nominee(s), write
such nominee(s) name(s) below:

___________________________________________________________

Please vote, date, and promptly return this proxy in
the enclosed return envelope which is postage prepaid
if mailed in the United States.

Signature(s)____________________________________________________________________________________________ Date ____________, 1999
Please sign exactly as your name appears hereon. If the stock is registered in the names of two or more persons, each should sign.
Executors, administrators, trustees, guardians, and attorneys-in-fact should add their titles. If signer is a corporation, please
give full corporate name and have a duly authorized officer sign, stating title. If signer is a partnership, please sign in
partnership name by an authorized person.
- ---------------------------------------------------------------------------------------------------------------------------------
- FOLD AND DETACH HERE -

</TABLE>