EXHIBIT 10.20

                               PROMISSORY NOTE

$71,500                                                       San Francisco, CA

                                                             September 22, 1999

          FOR VALUE RECEIVED, CHAITAN KHOSLA promises to pay Kosan
Biosciences Incorporated (the "Company"), or order, the principal sum of
seventy-one thousand, five hundred ($71,500), together with interest on the
unpaid principal hereof from the date hereof at the rate of five and 89/100
percent (5.89%) per annum, compounded semiannually.

          Principal and interest shall be due and payable on September 22,
2002. Should the undersigned fail to make full payment of principal or
interest for a period of 10 days or more after the due date thereof, the
whole unpaid balance on this Note of principal and interest shall become
immediately due at the option of the holder of this Note. Payment of
principal and interest shall be made in lawful money of the United States of
America.

          The undersigned may at any time prepay all or any portion of the
principal or interest owing hereunder.

          This Note is subject to the terms of the Option, dated as of
October 23, 1998. This Note is secured in part by a pledge of the Company's
Common Stock under the terms of a Security Agreement of even date herewith
and is subject to all the provisions thereof.

          The holder of this Note shall have full recourse against the
undersigned, and shall not be required to proceed against the collateral
securing this Note in the event of default.

          In the event the undersigned shall cease to be an employee or
consultant of the Company for any reason, this Note shall, at the option of
the Company, be accelerated, and the whole unpaid balance on this Note of
principal and accrued interest shall be immediately due and payable.

          Should any action be instituted for the collection of this Note,
the reasonable costs and attorneys' fees therein of the holder shall be paid
by the undersigned.


                                       /s/ Chaitan Khosla
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                                       Signature


                                           CHAITAN KHOSLA
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                                       Print Name