BARRIER THERAPEUTICS, INC. AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

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EXHIBIT 4.2

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BARRIER THERAPEUTICS, INC.

AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

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TABLE OF CONTENTS

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PAGE

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ARTICLE 1 GENERAL........................................................................ 1

1.1 Certain Definitions.............................................................. 1

ARTICLE 2 REGISTRATION................................................................... 4

2.1 Demand Registration.............................................................. 4

2.2 Piggyback Registrations.......................................................... 6

2.3 Form S-3 Registration............................................................ 7

2.4 Initial Public Offering.......................................................... 8

2.5 Expenses of Registration......................................................... 8

2.6 Obligations of the Company....................................................... 8

2.7 Furnishing Information........................................................... 11

2.8 Indemnification.................................................................. 11

2.9 Assignment of Registration Rights................................................ 13

2.10 Amendment of Registration Rights................................................. 14

2.11 Limitation on Subsequent Registration Rights..................................... 14

2.12 "Market Stand-Off" Agreement; Agreement to Furnish Information................... 14

2.13 Rule 144 Reporting............................................................... 15

ARTICLE 3 MISCELLANEOUS.................................................................. 15

3.1 Governing Law.................................................................... 15

3.2 Jurisdiction..................................................................... 15

3.3 Survival......................................................................... 16

3.4 Successors and Assigns........................................................... 16

3.5 Entire Agreement................................................................. 16

3.6 Severability..................................................................... 16

3.7 Amendment and Waiver............................................................. 17

3.8 Delays or Omissions.............................................................. 17

3.9 Notices.......................................................................... 17

3.10 Headings......................................................................... 17

3.11 Counterparts..................................................................... 17

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AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

This AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT (the

"Agreement") is entered into as of this 20th day of April, 2004, by and among

Barrier Therapeutics, Inc., a Delaware corporation (the "Company"), and the

Investors listed on Exhibit A hereto (collectively, the "Investors," and each as

"Investor").

RECITALS

WHEREAS, the Company, the holders (the "Series A Investors")

of the Company's Series A Convertible Preferred Stock (the "Series A Preferred

Stock") and the holders (the "Series B Investors") of the Company's Series B

Convertible Preferred Stock (the "Series B Preferred Stock") have entered into

that certain Investor Rights Agreement dated as of May 7, 2002, as amended as of

October 23, 2003 in connection with the sale of the Company's Series C

Convertible Preferred Stock (the "Series C Preferred Stock") to add the holders

of Series C Preferred Stock (the "Series C Investors") as parties hereto (the

"Original Investor Rights Agreement"), pursuant to which the Company has granted

registration rights and certain other rights to the Series A Investors, the

Series B Investors and the Series C Investors;

WHEREAS, the Company has filed Registration Statement No.

333-112539 on Form S-1 (the "Registration Statement") relating to an initial

public offering of the Company's Common Stock (the "IPO") and the Company and

the Investors desire for Articles 3 and 4 of the Original Investor Rights

Agreement to terminate immediately prior to the consummation of the IPO (the

"Effective Time"); and

WHEREAS, this Agreement amends and restates in its entirety

the Original Investor Rights Agreement to become effective at the Effective

Time.

NOW, THEREFORE, in consideration of the mutual promises,

representations, warranties, covenants and conditions set forth herein, the

parties mutually agree as follows:

ARTICLE 1

GENERAL

1.1 Certain Definitions. As used in this Agreement the following

terms shall have the following meanings:

"Affiliate", as applied to any individual or entity, shall

mean an individual or entity directly or indirectly (through one or more

intermediaries) controlling, controlled by or under common control with the

first individual or entity. As applied to an individual, "Affiliate" shall

include any member of such individual's immediate family or any trust for the

benefit of such family member or individual and as applied to any entity,

"Affiliate" shall include any subsidiary, parent, member, limited partner,

general partner, entity under common control of such general partner or its

members, partners or stockholders.

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"Common Stock" means the Company's authorized common stock

with $0.0001 par value per share.

"Exchange Act" means the Securities Exchange Act of 1934, as

amended, or any successor Federal statute in effect, and the rules and

regulations of the SEC promulgated thereunder, all as the same may from time to

time be in effect.

"Form S-3" means such form promulgated under the Securities

Act as in effect on the date hereof or any successor registration form under the

Securities Act subsequently adopted by the SEC which permits inclusion or

incorporation of substantial information by reference to other documents filed

by the Company with the SEC.

"Holder" means any Person owning of record Registrable

Securities that have not been sold to the public or any assignee of record of

such Registrable Securities in accordance with Section 2.10 hereof.

"Initial Public Offering" means the Company's first firm

commitment underwritten public offering of its Common Stock registered under the

Securities Act.

"Other Shares" shall mean at any time those shares of Common

Stock which do not constitute Primary Shares or Registrable Securities.

"Person" shall be construed in the broadest sense and means

and includes a natural person, a partnership, a corporation, an association, a

joint stock company, a limited liability company, a trust, a joint venture, an

unincorporated organization and any other entity and any federal, state,

municipal, foreign or other government, governmental department, commission,

board, bureau, agency or instrumentality, or any private or public court or

tribunal.

"Primary Shares" shall mean, at any time, the authorized but

unissued shares of Common Stock or Common Stock held by the Company in its

treasury.

"Register," "registered," and "registration" refer to a

registration effected by preparing and filing a registration statement in

compliance with the Securities Act, and the declaration or ordering of

effectiveness of such registration statement or document.

"Registrable Securities" means (a) Common Stock issued or

issuable upon conversion of the Shares; (b) any other Common Stock held, or

hereafter acquired, by the Investors or issuable to the Investors pursuant to

options, warrants or convertible securities; and (c) any Common Stock issued as

(or issuable upon the conversion or exercise of any warrant, right or other

security which is issued as) a dividend or other distribution with respect to,

or in exchange for or in replacement of, such above-described securities.

Notwithstanding the foregoing, Registrable Securities shall not include any

securities sold by a Person to the public pursuant to a registration statement

which has been declared effective, or Rule 144 or sold in a private transaction

in which the transferor's rights under Article II of this Agreement are not

assigned, in each case where the restrictive legends and transfer registrations

with respect to the Common Stock are removed and the Common Stock in the hands

of the purchaser is freely transferable without any restriction or registration

under the Securities Act in any public or private transaction.

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"Registrable Securities then outstanding" shall be the number

of shares determined by calculating the total number of shares of Common Stock

that are Registrable Securities and either (a) are then issued and outstanding

or (b) are issuable pursuant to then exercisable or convertible securities.

"Registration Expenses" mean all expenses incurred by the

Company in complying with Sections 2.2, 2.3 and 2.4 hereof, including, without

limitation, all registration and filing fees (including all expenses incident to

listing the Registrable Securities on a national securities exchange), printing

expenses, fees and disbursements of counsel for the Company, reasonable fees and

disbursements of the Stockholders' Counsel (as defined in Section 2.6(i)) (which

shall not exceed $50,000), blue sky fees and expenses and the expense of any

special audits incident to or required by any such registration (but excluding

the compensation of regular employees of the Company which shall be paid in any

event by the Company); provided, that no fees or disbursements of the JJDC

Counsel (as defined in Section 2.6(i)) shall be paid by the Company.

"Rule 144" shall mean Rule 144 promulgated under the

Securities Act or any successor rule thereto.

"Sale Of The Company" means (i) the sale of all or

substantially all of the Company's assets in one transaction or a series of

transactions, (ii) the sale or transfer of the outstanding capital stock of the

Company, or (iii) the merger or consolidation of the Company with or into

another Person or entity, in each case in clauses (ii) and (iii) above under

circumstances in which the holders of a majority in voting power of the

outstanding capital stock of the Company, immediately prior to such transaction,

own less than a majority in voting power of the outstanding capital stock of the

Company or the surviving or resulting corporation or acquirer, as the case may

be, immediately following such transaction. A sale (or multiple related sales)

of one or more Subsidiaries of the Company (whether by way of merger,

consolidation, reorganization or sale of all or substantially all assets or

securities) which constitutes all or substantially all of the consolidated

assets of the Company shall be deemed a Sale Of The Company.

"SEC" or "Commission" means the Securities and Exchange

Commission.

"Securities Act" means the Securities Act of 1933, as amended

or any successor Federal statute and the rules and regulations of the Commission

promulgated thereunder, all as the same may be in effect from time to time.

"Selling Expenses" mean all underwriting discounts and selling

commissions applicable to the sale.

"Shares" mean shares of the Company's Series A Preferred

Stock, Series B Preferred Stock and Series C Preferred Stock held, or hereafter

acquired, by the Investors and their permitted assigns.

"Stockholders Agreement" means the Company's Amended and

Restated Stockholders Agreement dated the date hereof.

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ARTICLE 2

REGISTRATION

2.1 Demand Registration.

(a) Subject to the conditions of this Section 2.1, if the

Company receives a request from the Holders of at least fifty percent (50%) of

the Registrable Securities then outstanding (the "Initiating Holders") that the

Company register shares with an aggregate offering price of at least $5,000,000,

then the Company shall, within fifteen (15) days after the receipt thereof, give

written notice of such request to all non-Initiating Holders. A non-Initiating

Holder must notify the Company within thirty (30) days of receipt of such

written notice if such non-Initiating Holder so desires to have its Registrable

Securities registered. The Company will use best efforts to effect, as soon as

practicable, the registration of all Registrable Securities that the Holders

(both Initiating Holders and non-Initiating Holders) request to be registered.

(b) If the Initiating Holders intend to distribute the

Registrable Securities by means of an underwriting, they shall so advise the

Company as a part of their demand pursuant to this Section 2.1 and the Company

shall include such information in the notice referred to in Section 2.2(a). In

such event, the right of any Holder to include its Registrable Securities in

such registration shall be conditioned upon participation in such underwriting.

The underwriter or underwriters for such offering shall be a nationally

recognized underwriter or underwriters selected by the Holders owning a majority

of the Registrable Securities requested to be included in such offering and

reasonably acceptable to the Company and such underwriter or underwriters shall

enter into a reasonable and customary underwriting agreement with the Company.

Notwithstanding any other provision of this Section 2.1, if the underwriter

advises the Company that marketing factors require a limitation of the number of

securities to be underwritten (including Registrable Securities) then the

Company shall so advise all participating Holders, and the number of shares that

may be included in the underwriting and registration shall be allocated pro rata

among the participating Holders in accordance with the number of Registrable

Securities held by such Holders; provided, however, that the number of shares of

Registrable Securities to be included in such underwriting and registration

shall not be reduced unless and until all other securities to be sold by the

Company and any Persons that are not Holders are first entirely excluded from

the underwriting and registration.

(c) The Company shall not be required to effect a

registration pursuant to this Section 2.1:

(i) prior to the earlier of (A) the fifth

anniversary of the Closing Date (as defined in the Series C Securities

Acquisition Agreement) and (B) six months following the effective date of the

registration statement pertaining to the Initial Public Offering;

(ii) after the Company has effected two

registrations pursuant to this Section 2.1, and such registrations have been

declared or ordered effective and maintained effective for (A) one hundred

twenty (120) days beyond the effective date or (B) until all shares so

registered have been sold, whichever period is longer (provided, however, that

such two registrations shall not include any registration pursuant to this

Section 2.1 in which the number

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of Registrable Securities registered is reduced by more than twenty percent

(20%) of the number of Registrable Securities that the Holders requested to be

registered);

(iii) during the period starting with the date of

filing of and ending on the date ninety (90) days following the effective date

of a registration statement pertaining to any underwritten public offering made

pursuant to this Section 2.1 or in which the Holders were given the opportunity

to participate pursuant to Section 2.2 for not less than thirty percent (30%) of

the amount of the offering; provided that each registration statement was

declared or ordered effective and maintained effective for (A) one hundred

twenty (120) days beyond the effective date or (B) until all shares so

registered have been sold, whichever period is longer;

(iv) if within ten (10) days of receipt of a

written request from the Initiating Holders pursuant to Section 2.1(a) the

Company shall furnish to the Initiating Holders a certificate signed by an

officer of the Company stating either (A) that in the good faith judgment of the

Board of Directors, it would be seriously detrimental to the Company and its

stockholders for such registration statement to be effected at such time or (B)

the Company intends to make its Initial Public Offering within sixty (60) days

of the date such request was received from the Initiating Holders, the Company

shall have the right to defer such filing for a period of not more than sixty

(60) days after receipt of the request of the Initiating Holders; provided,

that, such right to delay a request shall be exercised by the Company not more

than twice in any twelve (12) month period; provided, further, that the Company

shall not disclose any information that could be deemed material non-public

information of the Company to any of the Initiating Holders during such delayed

period; and

(v) if the Initiating Holders propose to dispose

of shares of Registrable Securities that may be immediately registered on Form

S-3 pursuant to a request made pursuant to Section 2.3 below.

(d) A requested registration under this Section 2.1 may

be rescinded prior to such registration being declared effective by the

Commission by written notice to the Company from the Initiating Holder;

provided, however, that such rescinded registration shall not count as a

registration initiated pursuant to this Section 2.1 if the Company shall have

been reimbursed (pro rata by the Initiating Holders or in such other proportion

as they may agree) for all out-of-pocket expenses incurred by the Company in

connection with such rescinded registration; provided further, however, that

such Initiating Holders shall not be required to reimburse the Company if such

rescission shall have been caused by, or made in response to, the material

adverse effect of an event on the business, prospects, properties, condition

(financial or otherwise) or operations of the Company.

2.2 Piggyback Registrations. If the Company at any time proposes

for any reason to register Primary Shares or Other Shares under the Securities

Act (other than (a) a rights offering, (b) a registration on Form S-4 or Form

S-8 promulgated under the Securities Act or any successor forms thereto, or (c)

in connection with the Company's Initial Public Offering), the Company shall

notify all Holders at least thirty (30) days prior to the filing of any

registration statement and will afford each Holder an opportunity to include in

such registration statement all or part of the Registrable Securities held by

such Holder on the same terms and conditions as the other shares participating

in the underwriting. Each Holder desiring to include Registrable

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Securities in any such registration statement shall notify the Company within

twenty (20) days after delivery of the notice from the Company. Such notice

shall state the intended method of disposition of the Registrable Securities by

such Holder. If a Holder decides not to include all of its Registrable

Securities in any registration statement filed by the Company, such Holder shall

nevertheless continue to have the right to include any Registrable Securities in

any subsequent registration statement or registration statements as may be filed

by the Company, all upon the terms and conditions set forth herein.

(a) Underwriting. If the registration statement under

which the Company gives notice under this Section 2.2 is for an underwritten

offering, the Company shall so advise the Holders. In such event, the right of

any Holder to be included in a registration pursuant to this Section 2.2 shall

be conditioned upon the Holder's participation in the underwriting.

Notwithstanding any other provision of the Agreement, if the underwriter

determines in good faith that marketing factors require a limitation of the

number of shares to be underwritten, the number of shares that may be included

in the underwriting shall be allocated as follows, first, the Primary Shares

being registered by the Company, second, the Registrable Securities requested to

be included in such registration by the Holders pro rata based on the total

number of Registrable Securities held by such Holders, and third, the Other

Shares requested to be registered by any other stockholder of the Company on a

pro rata basis based on the total number of shares held by such Persons. No such

reduction shall reduce the amount of securities of the selling Holders included

in the registration below thirty percent (30%) of the total amount of securities

included in such registration.

(b) Right to Terminate Registration. The Company shall

have the right to terminate or withdraw any registration initiated by it under

this Section 2.1 prior to the effectiveness of such registration whether or not

any Holder has elected to include securities in such registration. The

Registration Expenses of such withdrawn registration shall be borne by the

Company in accordance with Section 2.4 hereof.

(c) Inclusion of Common Holders. No stockholder of the

Company who is not a Holder shall be granted piggyback registration rights that

would reduce the number of shares that could be included by the Holders without

the consent of Holders owning at least two-thirds (2/3) of the Registrable

Securities.

2.3 Form S-3 Registration.

(a) If the Company shall receive from any Holder or

Holders a request that the Company effect a registration on Form S-3 or any

similar short-form registration statement with respect to all or a part of the

Registrable Securities, the Company shall:

(i) promptly give notice of the proposed

registration, and any related qualification or compliance, to all other Holders

and shall offer to include in such proposed registration any Registrable

Securities requested to be included in such proposed registration by such

Holders who respond in writing to the Company's notice within 30 days after

delivery of such notice (which response shall specify the number of Registrable

Securities proposed to be included in such registration); and

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(ii) promptly effect such registration and all

such qualifications and compliances as would permit or facilitate the sale and

distribution of the Registrable Securities specified in such request, together

with the Registrable Securities of any other Holder or Holders joining in such

request by notice to the Company given within thirty (30) days after receipt of

such notice from the Company.

(b) Notwithstanding anything to the contrary contained

herein, the Company shall not be obligated to effect any registration,

qualification or compliance pursuant to this Section 2.3:

(i) if Form S-3 is not available for such

offering by the Holders;

(ii) if the Holders, together with the holders of

any other securities of the Company entitled to inclusion in such registration,

propose to sell Registrable Securities and such other securities (if any) at an

aggregate price to the public of less than $1,000,000;

(iii) if the Company shall furnish to the Holders

a certificate signed by the President or Chief Executive Officer of the Company

stating that in the good faith judgment of the Board of Directors, it would be

seriously detrimental to the Company and its stockholders for such Form S-3

registration to be effected at such time, in which event the Company shall have

the right to defer the filing of the Form S-3 registration statement for a

period of not more than thirty (30) days after receipt of the request of the

Holder or Holders under this Section 2.3; provided, that such right to delay a

request shall be exercised by the Company not more than twice in any twelve (12)

month period;

(iv) if the Company has, within the twelve (12)

month period preceding the date of such request, already effected three (3)

registrations on Form S-3 for the Holders pursuant to this Section 2.3; or

(v) in any particular jurisdiction in which the

Company would be required to qualify to do business or to execute a general

consent to service of process in effecting such registration, qualification or

compliance where it would not otherwise be required so to do.

(c) Registrations effected pursuant to this Section 2.3

shall not be counted as demands for registration or registrations effected

pursuant to Section 2.1. If the initiating Holders intend to distribute

Registrable Securities pursuant to an underwriting, they shall so advise the

Company in the demand pursuant to Section 2.1(a).

(d) After the Company's Initial Public Offering, the

Company will use commercially reasonable efforts to qualify for the registration

of its shares of Common Stock on Form S-3.

2.4 Initial Public Offering. In connection with the Initial Public

Offering, the Company shall grant the Series A Investors, Series B Investors and

Series C Investors a right to purchase five percent (5%) of the shares (the "IPO

Shares") of Common Stock being offered in such public offering; provided,

however, that the Company shall not grant such right to an Investor if (i) with

respect to the Series C Investors only, the Initial Public Offering occurs prior

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to the first anniversary of the date hereof or (ii) compliance with the

provisions of this Section 2.4 would violate Section 5 of the Securities Act.

Any shares offered and sold to Investors under this Section 2.4 shall be offered

to the Investors (with Investors permitted to reallocate all or any portion of

their respective IPO Shares to Affiliates) pro-rata based upon the number of

shares of Common Stock (on an as converted basis) held by each Investor divided

by the total number of shares of Common Stock held by all Investors. Shares not

accepted by an Investor or its Affiliates shall not be reallocated among those

Investors electing to purchase IPO Shares. In the event that an Investor is not

permitted to purchase IPO Shares as a result of the restrictions contained in

clause (i) or (ii) above, the Company shall sell to such Investor who is a

"qualified institutional buyer" (as such term is defined in Rule 144A

promulgated under the Securities Act) and to such Investor who is subject to

Regulation S (promulgated under the Securities Act) a number of shares of Common

Stock equal to its pro rata portion of IPO Shares at the same gross purchase

price as the IPO Shares. Nothing in this Section 2.4 shall limit any Investor or

any Affiliate of any Investor from purchasing shares of Common Stock in the

Initial Public Offering that are not IPO Shares.

2.5 Expenses of Registration. Except as specifically provided

herein, all Registration Expenses incurred in connection with any registration

under Section 2.1, Section 2.2 or Section 2.3 herein shall be borne by the

Company. All Selling Expenses incurred in connection with any registrations

hereunder shall be borne by the Persons selling the securities in proportion to

the number of securities sold by such seller or sellers.

2.6 Obligations of the Company. Whenever required to register any

Registrable Securities, the Company shall, as expeditiously as reasonably

possible:

(a) Use commercially reasonable efforts to prepare and

file with the SEC a registration statement with respect to such Registrable

Securities and to cause such registration statement to become effective, and,

upon the request of the selling Holders of a majority of the Registrable

Securities registered thereunder, keep such registration statement effective for

up to 120 days for a registration pursuant to Section 2.1 and for up to 180 days

for a registration pursuant to Section 2.3 or, if earlier, until the Holder or

Holders have completed the distribution related thereto;

(b) Use its reasonable best efforts to prepare and file

with the SEC such amendments and supplements to such registration statement and

the prospectus used in connection with such registration statement as may be

necessary to comply with the provisions of the Securities Act with respect to

the disposition of all securities covered by such registration statement for the

applicable period set forth in paragraph (a) above and to cause such amendments

and supplements to become and remain effective;

(c) Furnish to the Holders and each underwriter such

number of copies of a prospectus, including a preliminary prospectus, in

conformity with the requirements of the Securities Act, and such other documents

as they may reasonably request in order to facilitate the disposition of

Registrable Securities;

(d) Use its best efforts to register and qualify the

securities covered by such registration statement under such other securities or

Blue Sky laws of such jurisdictions as shall

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be reasonably requested by the Holders and register such securities with or

obtain the approval of such other governmental authorities as may be necessary

by virtue of the business and operations of the Company to enable the seller or

sellers thereof to consummate the disposition of such Registrable Securities;

provided, that the Company shall not be required in connection therewith or as a

condition thereto to qualify to do business or to file a general consent to

service of process in any such states or jurisdictions where it would not

otherwise be required so to do but for this subparagraph;

(e) In the event of any underwritten public offering,

enter into and perform its obligations under an underwriting agreement, in usual

and customary form, with the managing underwriter(s) of such offering;

(f) Notify on a timely basis each Holder of Regis