AMENDED AND RESTATED EMPLOYMENT AGREEMENT

Exhibit 10.21

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

      THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement” ) is made and entered into effective as of this 31 ^st day of December, 2008 by and between Cypress Bioscience, Inc. , a Delaware corporation (the “Company” ) and Denise Wheeler (the “Employee” ).

      WHEREAS , the Company desires to employ the Employee in an executive capacity as its General Counsel on the terms and conditions set forth herein and the Employee is willing to accept and undertake such employment.

      WHEREAS , the Company and the Employee desire to amend and restate this Agreement in its entirety as set forth herein, effective as of the date set forth above, to, among other things, clarify the application of Section 409A of the Internal Revenue Code of 1986, as amended (the “Code” ) to the benefits that may be provided to the Employee.

AGREEMENT

      NOW THEREFORE , in consideration of the premises and the mutual covenants herein set forth, the Company and the Employee agree as follows:

ARTICLE 1

EMPLOYMENT; TERM; DUTIES

      1.1 Employment. Upon the terms and conditions hereinafter set forth, the Company hereby employs the Employee, and the Employee hereby accepts continued employment, as General Counsel ( “General Counsel” ) of the Company.

      1.2 Term. Unless sooner terminated as provided in Article 5 hereof, the Employee’s employment hereunder shall be for a term commencing in February 2004 and ending on February 4, 2006, subject to automatic renewal for one year periods unless written notice has been provided by either party at least seventy-five (75) days prior to the date of such automatic renewal (a “Non-Renewal Notice” ). Notwithstanding anything herein to the contrary, either party may terminate the Employee’s employment under this Agreement at any time, with or without Cause, subject to the terms and conditions of Article 5 herein. The actual term of employment hereunder, giving effect to any early termination of employment under Article 5 hereof, is referred to as the “Term.”

      1.3 Duties. During the Term, the Employee shall perform such executive duties for the Company and for its subsidiaries, consistent with her position hereunder and as typically associated with the duties of a General Counsel of a publicly-held corporation and as reasonably may be assigned to her from time to time by the Board and the Chief Executive Officer of the Company. Except as contemplated by Section 1.5, the Employee shall devote her entire business time, attention and energies to the performance of her duties hereunder.

      1.4 Exclusive Agreement. The Employee represents and warrants to the Company that she is not a party to any agreement or arrangement, whether written or oral, in effect which

would prevent the Employee from rendering the services contemplated hereunder to the Company during the Term.

      1.5 Other Activity. Notwithstanding the foregoing, subject to her fiduciary duties to the Company under applicable law, the Company acknowledges and understands that the Employee may serve as a director of other companies not in competition with the Company by providing prior written notice to the Company ; provided, however, that the performance of such services shall not restrict or limit in any manner the Employee’s ability to perform her duties hereunder.

      1.6 Insurance. The Company shall obtain, and shall use its commercially reasonable best efforts to maintain during the Term, Director’s and Officer’s Insurance and Product Liability Insurance policies, with full defense coverage of at least $10,000,000 for each, respectively, with regard to all actions undertaken by the Employee in her capacity as an officer and employee of the Company.

ARTICLE 2

COMPENSATION

      2.1 Base Salary. For all services rendered by the Employee hereunder and in consideration of all covenants and conditions undertaken by her pursuant to this Agreement, the Company shall pay the Employee an annual base salary ( “Base Salary” ) of $225,000 per year in equal semi-monthly installments, and which shall be increased if there is an across the board increase in base salary for other executive officers. In addition, each year during the Term, the Board shall review the Base Salary with a view to determining whether it would be appropriate to increase such Base Salary. The annual Base Salary payable to the Employee hereunder, as it may be so increased, thereafter shall constitute the “Base Salary” . If the first or last month of the Term is not a full calendar month, then any calculation of Base Salary for such period shall be prorated for the number of days in such months during which the Employee was employed.

      2.2 Bonuses.

           (a) In addition to the Base Salary, the Employee may be eligible for cash bonuses (the “Bonus Amount” ) based on the performance of the Employee during a fiscal year, as evaluated by the CEO and the Board in their sole discretion. Any such Bonus Amount shall be paid no later than the fifteenth day of the third month following the end of the Company’s fiscal year for which such Bonus Amount was earned. It is acknowledged and agreed that the determination and the payment of the Bonus Amount to the Employee shall be at the sole discretion of the Board which may consider, among other matters, the financial condition of the Company at the time. In exercising its discretion pursuant to this subsection, the Board shall act in a manner at least as favorable to the Employee as governs the award of bonuses to other executive officers and key employees of the Company.

      2.3 Deductions. The Company shall deduct from the compensation described in this Section 2 any Federal, state or city withholding taxes, social security contributions and any other

amounts which may be required to be deducted or withheld by the Company pursuant to any federal, state or city laws, rules or regulations.

ARTICLE 3

BENEFITS

      3.1 Benefits. During the Term, the Employee shall be entitled to participate in such compensation and incentive plans and group life, health, accident, disability and hospitalization insurance plans, pension plans and retirements plans as the Company may make available to its other executive officers.

      3.2 Life Insurance. The Company agrees that it will provide the Employee with life insurance policy or policies in amounts at least as favorable to the Employee as governs the other executive officers, subject to availability of such insurance at commercially reasonable costs and the mutual agreement of the Company and the Employee as to the type and nature of the policies.

      3.3 Expenses. The Company agrees that the Employee is authorized to incur reasonable and customary expenses in the performance of her duties hereunder, including travel and entertainment costs, and upon presentation of appropriate documentation thereof, the Company promptly, but in no event later than December 31 of the calendar year following the year in which such expenses were incurred by the Employee, shall pay or reimburse the Employee for such reasonable expenses. In the event that any reimbursement by the Company of expenses of the Employee hereunder is deducted by the Company, and results in additional taxes due and payable by the Employee, the Company shall pay to the Employee an additional tax gross-up payment to the Employee in an amount that shall fully fund the payment by the Employee of any income and employment taxes on such reimbursement payment and tax gross-up payment. Any tax gross-up payment shall be made as soon as practicable, but in no event later than the end of the Employee’s taxable year following the year in which the Employee pays the related taxes.

      3.4 Vacations. During each full year of the Term, the Employee shall be entitled to four (4) weeks of paid vacation, to be taken at times determined by the Employee which are mutually agreeable with the Company and which do not unreasonably interfere with the performance of her duties hereunder.

ARTICLE 4

STOCK AWARDS

      4.1 Stock Awards.

           (a) In the event of a termination (as described in Article 5), and except as otherwise provided in Section 4.1(b) and 4.1(c) hereof, all Stock Awards which have not vested as of the Termination Date shall cease vesting and any unvested Stock Awards shall be cancelled as of the Termination Date. Unless otherwise set forth in the applicable equity incentive plan or stock award agreement, and except as otherwise provided in Section 4.1(b) and 4.1(c) hereof, all

vested and exercisable Stock Awards shall be cancelled three (3) months after the Termination Date if not exercised prior to such expiration date.

           (b) Upon the Employee’s death or Disability (as defined in Section 5.1 below), all rights under such Stock Awards shall transfer to the Employee’s designated beneficiary, if applicable. Unless otherwise set forth in the applicable equity incentive plan or stock award agreement, all Stock Awards shall be cancelled twelve (12) months after the Employee is terminated due to Disability if not exercised prior to such expiration date. In the event of the Employee’s death, the Employee’s legal representatives shall have eighteen (18) months following the Termination Date to exercise any exercisable Stock Awards before they are cancelled.

           (c) Notwithstanding anything to the contrary in the foregoing, in the event of a termination of this Agreement in any of the cases identified in Section 5.3 or 5.4 hereof, Stock Awards may accelerate vesting as provided in those Sections.

           (d) The Company may grant the Employee Stock Awards to purchase the Company’s common stock at such times and on such terms as may be decided from time to time by the Board, in its sole discretion.

           (e) For purposes of this Agreement, “Stock Awards” means all stock options, restricted stock, and other equity awards granted pursuant to the Company’s stock option and equity incentive award plans or agreements and any shares of Company stock issued upon exercise thereof. However, “Stock Awards” does not include stock awards issued under or held in any plan sponsored by the Company that is intended to be qualified under Section 401(a) of the Internal Revenue Code ( e.g. , the Company’s 401(k) plan).

ARTICLE 5

DEATH, DISABILITY; TERMINATION

      5.1 Death; Disability. The Employee’s employment hereunder shall terminate upon her death or, at the election of the Company, by written notice to the Employee if the Employee becomes Disabled (as such term is hereinafter defined), to the extent permitted by law. In the event of a termination of the Employee’s employment for death or disability, the Company shall promptly pay the Employee (or her legal representatives, as the case may be) all earned and unpaid wages and accrued vacation.

     For the purposes of this Agreement, the Employee shall be deemed to be “Disabled” or have a “Disability” if as a result of the occurrence of mental or physical disability during the Term she has been unable to perform her duties hereunder for six (6) consecutive months or one hundred eighty (180) days in any twelve (12) consecutive month period, as determined in good faith by the Board ; provided, however, that if the Employee develops a mental or physical disability during the Term, and it is determined, in the reasonable professional judgment of an independent, objective and qualified medical expert in the field of such disability, that the Employee will be unable to perform her duties hereunder and that such disability will continue for six (6) consecutive months or one hundred eighty 180 days in any twelve (12) consecutive

month period, then to the extent permitted by law, the Company shall be permitted to terminate the Employee’s employment immediately.

     The date of any termination of employment under this Section 5.1 or Sections 5.2, 5.3 or 5.4 is referred to herein as the “Termination Date.”

      5.2 Termination of Employment by Employee.

           (a) Notwithstanding any provision to the contrary herein, unless otherwise provided herein or unless otherwise provided by law, the Employee at any time, upon thirty (30) days’ written notice to the Company, may terminate her employment by the Company hereunder. Except as otherwise provided in Section 5.2(b) below, the Company shall not be liable to the Employee for the payment of any amount on such termination.

           (b) In the event that the Employee terminates her employment as General Counsel following (i) an uncured material breach of this Agreement by the Company, (ii) the occurrence the relocation of the Company’s executive offices or principal business location to a point more than thirty (30) miles from the San Diego, California area, (iii) any uncured action by the Board or direction given by the Board to the Employee that is contrary to applicable law or accounting standards or constitutes an unethical business practice, or (iv) a demotion or the occurrence of a material reduction in the Employee’s authority, functions or responsibilities as General Counsel without her consent, then such termination by the Employee shall be deemed for all purposes, including for purposes of severance payments and benefits provided under Section 5.3 hereof, to be a termination by the Company of the employment of the Employee hereunder without cause pursuant to Section 5.3. The Company shall have thirty (30) days following receipt of written notice by the Employee to the Company of the material breach described in items (i) and (iii) above, setting forth in reasonable detail the matter constituting such breach, to cure such breach.

                (i) Termination of Employment With Cause. In addition to any other remedies available to it at law, in equity or as set forth in this Agreement, the Company shall have the right, upon written notice to the Employee, to immediately terminate her employment hereunder if the Employee (a) evidences a pattern of willful breach in any material respect of any material provision of this Agreement or a pattern of willful violation of any reasonable policies or orders of the CEO or the Board and such pattern of willful breach or violation does not cease within thirty (30) days after the Employee’s receipt of written notice thereof from the Board setting forth in reasonable detail the matters constituting such pattern; (b) the Employee’s commission of an act that materially injures the business of the Company; (c) the Employee’s conviction of a felony involving moral turpitude that is likely to inflict or has inflicted material injury on the business of the Company; (d) the Employee’s engaging or in any manner participating in any activity which is directly competitive with or injurious to the Company or any of its Affiliates or which violates any material provisions of Article 6 hereof or the Employee’s Proprietary Information and Inventions Agreement with the Company; or (e) the Employee’s commission of any fraud against the Company, its Affiliates, employees, agents or customers or use or intentional appropriation for her personal use or benefit of any funds or properties of the Company not authorized by the CEO or the Board to be so used or appropriated.

      5.3 Termination of Employment Without Cause or for Non-Renewal.

           (a) Notwithstanding any provision to the contrary herein and unless otherwise provided by law, the Company, at any time upon thirty (30) days’ written notice to the Employee, in its sole and absolute discretion and for any or no reason, may terminate the employment of the Employee as General Counsel hereunder without cause. In such event, if the Company issues the Employee a Non-renewal Notice, or if the Agreement expires and the Employee is not rehired, then upon the Employee furnishing the Company with a Release and Waiver of Claims in the form of either Exhibit A or Exhibit B attached hereto, as applicable (the “Release”) within the applicable time period set forth therein, but in no event later than forty-five (45) days following termination of employment, and permitting such Release to become effective in accordance with its terms, the Company shall pay the Employee a single lump sum equal to six (6) months of the Base Salary within ten (10) days following the effective date of the Release. Notwithstanding the foregoing, the timing of the severance payments is subject to the provisions of Section 5.7, to the extent applicable.

           (b) In the event that the employment of the Employee hereunder is terminated by the Company without cause, all Stock Awards that would have vested in accordance with their applicable vesting schedules if Employee had continued in employment with the Company for an additional six (6) months as of Termination Date, shall vest immediately upon the Termination Date.

           (c) In the event that the employment of the Employee hereunder is terminated by the Company without cause, the Company, at no cost to the Employee and for a period of twelve (12) months from the Termination Date, shall continue to provide Employee and her family with all health insurance benefits available under COBRA; provided that Employee timely elects and is eligible for continued coverage under COBRA. Subject to the provisions of Section 5.7, to the extent applicable, the Company shall make any coverage payments directly to any insurer on a monthly basis or otherwise in accordance with the insurer’s standard billing practices.

           (d) The Employee acknowledges that the payments referred to in this Section 5.3 constitute the only payments which the Employee shall be entitled to receive from the Company under this Agreement in the event of any termination pursuant to this Section 5.3, and that except for such payments and such other obligations as are expressly provided herein the Company shall have no further liability or obligation to her under this Agreement.

           (e) The Employee shall have no duty to mitigate damages in order to receive any severance payments and benefits provided in this Section 5.3.

      5.4 Change in Control.

           (a)  In the event Employee is terminated without cause during the period beginning one (1) month before and ending thirteen (13) months following the effective date of a Change in Control, in lieu of (and not in addition to) the severance benefits that would otherwise be provided