MEMBERS:

Spencer R. Berthelsen, M.D., Chairman

Richard D. DiMarchi, Ph.D.

John C. Reed, M.D. Ph.D.

Joseph H. Wender

CHARTER

The Compensation Committee of the Board of Directors of Isis Pharmaceuticals shall consist of at least two directors. Each member of the Compensation Committee must be independent of the Company. Members of the committee will be considered independent as long as they meet the independence requirements of Rule 16b-3 under the Securities Exchange Act of 1934, as amended and the applicable Nasdaq rules. The Compensation Committee shall be charged with the following functions:

1.      Overall Compensation Strategy. The Committee shall review, modify (as needed) and approve the overall compensation strategy and policies for the Company, including:

o        reviewing and approving corporate performance goals and objectives relevant to the compensation of the Company's Executive Officers;

o        evaluating and recommending to the Board the compensation plans and programs advisable for the Company, as well as modification or termination of existing plans and programs;

o        establishing policies with respect to equity compensation arrangements; and

o        reviewing and approving compensatory arrangements for the Company's Executive Officers.

2.      Compensation of Chief Executive Officer. The Committee, meeting in executive session, shall determine, in its sole discretion, the compensation and other terms of employment of the Company's Chief Executive Officer and shall evaluate the Chief Executive Officer's performance in light of relevant corporate performance goals and objectives.

3.      Compensation of Other Executive Officers. The Committee shall review and approve the individual and corporate performance goals and objectives of the Company's Executive Officers, that are periodically established and shall approve the salary, bonus, terms of any employment agreements, severance arrangements, change-of-control protections and any other compensatory arrangements for the Company's Executive Officers.

4.      Compensation of Directors. The Committee shall recommend to the Board the type and amount of compensation to be paid or awarded to Board members, including consulting, retainer, Board meeting, committee and committee chair fees and stock option grants or awards.

5.      Administration of Benefit Plans. The Committee shall recommend to the Board the adoption, amendment and termination of the Company's stock option plans, stock appreciation rights plans, pension and profit sharing plans, incentive plans, stock bonus plans, stock purchase plans, bonus plans, deferred compensation plans and similar programs. The Committee shall have full power and authority to administer these plans, establish guidelines, interpret plan documents, select participants, approve grants and awards, and exercise such other power and authority as may be permitted or required under such plans.

6.      To perform such other functions and have such other powers as may be necessary or convenient in the efficient discharge of the foregoing.

7.      To report to the Board of Directors from time to time, or whenever it shall be called upon to do so.

Minutes of each meeting of the Compensation Committee shall be prepared and distributed to each director of the Company promptly after such meeting.

The Committee shall have full access to all books, records, facilities and personnel of the Company as deemed necessary or appropriate by any member of the Committee to discharge his or her responsibilities hereunder. The Committee shall have the authority to obtain, at the expense of the Company, advice and assistance from internal or external legal, accounting or other advisors and consultants

The operation of the Compensation Committee shall be subject to the Bylaws of the Company as in effect from time to time and Section 141 of the Delaware General Corporation Law.