SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of
1934

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 Rule 14a-11(c) or Rule 14a-12

MAXYGEN, 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.
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Item 22(a)(2) of Schedule 14A.
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[LOGO OF MAXYGEN, INC.]
515 Galveston Drive
Redwood City, California 94063

April 27, 2000

To Our Stockholders:

I am pleased to invite you to attend the 2001 Annual Meeting of Stockholders
of Maxygen, Inc. to be held at the Stanford Park Hotel, 100 El Camino Real,
Menlo Park, California 94025, on Friday, June 1, 2001, at 1:00 p.m. local time.

The matters expected to be acted upon at the meeting are described in detail
in the following Notice of Annual Meeting of Stockholders and Proxy Statement.

The Board of Directors appreciates and encourages stockholder participation
in the Company's affairs and invites you to attend the meeting in person. It is
important, however, that your shares be represented at the annual meeting in
any event and for that reason we ask that whether or not you expect to attend
the meeting, you take a moment to complete, date, sign and return the
accompanying proxy in the enclosed postage-paid envelope. Returning the proxy
does not deprive you of your right to attend the meeting and to vote your
shares in person.

We thank you for your support and look forward to seeing you at the meeting.

Sincerely,

/s/ Russell J. Howard
Russell J. Howard
Chief Executive Officer

[LOGO OF MAXYGEN]

515 Galveston Drive
Redwood City, CA 94063

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

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 1, 2001

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

To Our Stockholders:

NOTICE IS HEREBY GIVEN that the annual meeting of the stockholders of
Maxygen, Inc., a Delaware corporation (the "Company"), will be held on Friday,
June 1, 2001, at 1:00 p.m. local time at the Stanford Park Hotel, 100 El Camino
Real, Menlo Park, California 94025 for the following purposes:

1. To elect six directors of the Company, each to serve until the 2002 Annual
Meeting of Stockholders and until his or her successor has been elected and
qualified or until his or her earlier resignation or removal. The Company's
Board of Directors intends to present the following nominees for election as
directors:

Russell J. Howard M.R.C. Greenwood
Isaac Stein Gordon Ringold
Robert J. Glaser George Poste

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

These business items are more fully described in the Proxy Statement
accompanying this Notice.

The Board of Directors has fixed the close of business on April 17, 2001, as
the record date for identifying those stockholders entitled to notice of, and
to vote at, the Annual Meeting and any adjournment or postponement thereof.

By Order of the Board of Directors

/s/ Julian Stern
Julian Stern
Secretary

Redwood City, California
April 27, 2001

All stockholders are cordially invited to attend the meeting in person.
Whether or not you plan 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.

[LOGO OF MAXYGEN]

515 Galveston Drive
Redwood City, CA 94063

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

PROXY STATEMENT
FOR ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD ON JUNE 1, 2001

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INFORMATION CONCERNING SOLICITATION AND VOTING

General

The enclosed proxy is solicited on behalf of the Board of Directors of
Maxygen, Inc., a Delaware corporation (the "Company" or "Maxygen"), for use at
the Annual Meeting of Stockholders of the Company to be held on June 1, 2001 at
1:00 p.m. local time, or at any adjournment or postponement of the meeting, for
the purposes set forth in this Proxy Statement and in the accompanying Notice
of Annual Meeting. The Annual Meeting will be held at the Stanford Park Hotel,
100 El Camino Real, Menlo Park, California 94025. The Company's telephone
number is (650) 298-5300.

These proxy solicitation materials, together with the Company's 2000 Annual
Report, are being mailed on or about April 27, 2001, to all stockholders of
record on April 17, 2001.

Record Date

Stockholders of record at the close of business on April 17, 2001 (the
"Record Date") are entitled to notice of, and to vote at, the meeting. At the
Record Date, 33,819,819 shares of the Company's common stock were issued and
outstanding.

Revocability of Proxies

Any proxy given pursuant to this solicitation may be revoked by the person
giving it at any time before its use by delivering to the Company a written
notice of revocation or a duly executed proxy bearing a date later than the
date of the proxy being revoked, or by attending the meeting and voting in
person. Attending the meeting will not, by itself, revoke the proxy.

Voting and Solicitation

Holders of the Company's common stock are entitled to one vote for each
share held as of the record date. Holders of common stock do not have
cumulative voting rights.

For Shares Registered in the Name of a Broker or Bank

A number of brokers and banks are participating in a program through ADP
Investor Communication Services that offers telephone and Internet voting
options. If your shares are held in an account with a broker or bank
participating in the ADP Investor Communications Services program, you may vote
those shares telephonically by calling the telephone number shown on the voting
form received from your broker or bank, or via the Internet at ADP Investor
Communication Services' voting Web site (www.proxyvote.com).

General Information for All Shares Voted Via the Internet or By Telephone

Votes submitted via the Internet or by telephone must be received by 4 p.m.,
on May 31. Submitting your proxy via the Internet or by telephone will not
affect your right to vote in person should you decide to attend the meeting.

The telephone and Internet voting procedures are designed to authenticate
stockholders' identities, to allow stockholders to give their voting
instructions and to confirm that stockholders' instructions have been recorded
properly. Stockholders voting via the Internet should understand that there may
be costs associated with electronic access, such as usage charges from Internet
access providers and telephone companies, that must be borne by the
stockholder.

Solicitation

The cost of soliciting proxies will be borne by the Company. Proxies may
also be solicited by certain of the Company's directors, officers and
employees, without additional compensation, personally or by telephone,
facsimile or letter.

Quorum, Abstentions, and Broker Non-Votes

The required quorum for the transaction of business at the annual meeting is
a majority of the shares of common stock outstanding on the Record Date.
Abstentions are included in the determination of shares present for quorum
purposes. Because abstentions represent shares entitled to vote, the effect of
an abstention will be the same as a vote against a proposal. If shares are held
in "street name" through a broker or other nominee, the broker or nominee may
not be permitted to exercise voting discretion with respect to certain matters
to be acted upon. If the broker or nominee is not given specific instructions,
shares held in the name of such broker or nominee may not be voted on those
matters and will not be considered as present and entitled to vote with respect
to those matters. Shares represented by such "broker non-votes" will, however,
be counted in determining whether there is a quorum.

PROPOSAL NO. 1

ELECTION OF DIRECTORS

At the meeting, stockholders will elect members of the Company's Board of
Directors (the "Board") to hold office until the 2002 Annual Meeting of
Stockholders and until their respective successors have been elected and
qualified or until any such director's earlier death, resignation or removal.
Each nominee listed below is currently a director of the Company. The size of
the Board is presently set at six members. Accordingly, six nominees will be
elected at the meeting to be the six directors of the Company. Directors are
elected by a plurality (excess of votes cast over opposing nominees) of the
votes present in person or represented by proxy and entitled to vote. If signed
and returned, shares represented by the accompanying proxy will be voted for
the election of the six nominees recommended by the Board unless the proxy is
marked in such a manner as to withhold authority so to vote. If any nominee for
any reason is unable to serve or for good cause will not serve, the proxies may
be voted for such substitute nominee as the proxy holder may determine. Each
person nominated for election has agreed to serve if elected and the Company
has no reason to believe that any nominee will be unable to serve.

Directors/Nominees

The names of the nominees and certain information about them, including
their ages as of April 17, 2001, are set forth below:

Director
Name of Nominee Age Position Held With the Company Since
- --------------- --- ------------------------------ --------

Russell J. Howard, Ph.D....... 50 Chief Executive Officer & 1998
Director

Isaac Stein(1)(2)............. 54 Director & Chairman of the Board 1996

Robert J. Glaser, M.D.(2)..... 82 Director 1997

M.R.C. Greenwood, Ph.D........ 57 Director 1999

Gordon Ringold, Ph.D.(1)(2)... 50 Director 1997

George Poste, D.V.M.,
Ph.D.(1)..................... 56 Director 1999

- --------
(1) Current member of the Audit Committee and the Finance Committee.
(2) Current member of the Compensation Committee.

Russell J. Howard, Ph.D., has served as the Company's Chief Executive
Officer and a Director since June 1998 and is one of the Company's co-founders.
Dr. Howard was elected the Company's President and Chief Operating Officer in
May 1997. Originally trained in biochemistry and chemistry, Dr. Howard has
spent over 20 years studying infectious diseases, primarily malaria, and
currently serves on the National Institutes of Health and USAID advisory panels
for malaria vaccine development. Before joining Maxygen, Dr. Howard was from
August 1994 to June 1996 the President and Scientific Director of Affymax
Research Institute, an institute employing combinatorial chemistry and high
throughput target screening to discover drug leads.

Isaac Stein has served as the Chairman of the Board of Directors of the
Company since June 1998 and a Director since May 1996. He is one of the
Company's co-founders. Since November 1982, Mr. Stein has been President of
Waverley Associates, Inc. a private investment firm. Mr. Stein is also a
managing member of Technogen Enterprises, L.L.C. and of Technogen Managers,
L.L.C., which is the general partner of Technogen Associates, L.P. He is also
the Chairman of the Board of Trustees of Stanford University.

Robert J. Glaser, M.D., has served as a Director of the Company since
September 1997. Dr. Glaser was Director for Medical Science at the Lucille P.
Markey Charitable Trust from 1984 to June 1997, and a Trustee from 1988 to June
1997, when in accordance with the donor's will, the Trust ceased operations.
Dr. Glaser is also a Director of the ALZA Corporation and Hanger Orthopedic
Group, Inc. He was Dean of the medical schools at the University of Colorado
and Stanford University, and Professor of Social Medicine at

Harvard University. Trained as an internist, Dr. Glaser has 124 publications on
streptococcal infections, rheumatic fever, medical education and health care,
as well as being a contributor to numerous scientific treatises. He was a
founding member of the Institute of Medicine, National Academy of Sciences, and
a Fellow of the American Academy of Arts and Sciences, the American
Philosophical Society and the Royal College of Physicians of London.

M.R.C. Greenwood, Ph.D., has served as a Director of the Company since
February 1999. Dr. Greenwood has been Chancellor of the University of
California ("UC") at Santa Cruz since July 1996. Before being named Chancellor
of UC Santa Cruz, Dr. Greenwood was Dean of Graduate Studies and Vice Provost
at UC Davis from July 1989 to July 1996. In addition, from November 1993 to May
1995, Dr. Greenwood took a leave from UC Davis to serve as Associate Director
for Science in the White House Office of Science and Technology Policy. Dr.
Greenwood received her Ph.D. in physiology, developmental biology and
neurosciences from Rockefeller University.

Gordon Ringold, Ph.D., has served as a Director of the Company since
September 1997. Since 1997, Dr. Ringold has served as Chairman and Chief
Executive Officer of SurroMed Inc., a biotechnology company focused on novel
clinical databases. From March 1995 to February 2000, Dr. Ringold was Chief
Executive Officer and Scientific Director of Affymax Research Institute where
he managed the development of novel technologies to accelerate the pace of drug
discovery. Before serving as Chief Executive Officer, Dr. Ringold was the
President and Scientific Director of Affymax Research Institute. Dr. Ringold
received his Ph.D. in the laboratory of Dr. Harold Varmus, before joining the
Stanford University School of Medicine, Department of Pharmacology, and serving
as the Vice President and Director of the Institute for Cancer and Development
Biology of Syntex Research. Dr. Ringold is a Managing Member of Technogen
Enterprises, L.L.C. and of Technogen Managers, L.L.C., which is the general
partner of Technogen Associates, L.P.

George Poste, D.V.M., Ph.D., has served as a Director of the Company since
October 1999. Dr. Poste was Chief Science and Technology Officer at SmithKline
Beecham from 1997 to 1999 and was a member of the Board of Directors of
SmithKline Beecham. Before being appointed as Chief Science and Technology
Officer, Dr. Poste was President of Research and Development at SmithKline
Beecham from 1989. Dr. Poste is also a research professor at the University of
Texas, MD Anderson Cancer Center in Houston, holds the William Pitt Fellowship
at Pembroke College, Cambridge University, and is a Distinguished Visiting
Fellow at the Hoover Institution, Stanford University. He is a Board-certified
pathologist. Dr. Poste received his Doctorate in Veterinary Medicine in 1966
and his Ph.D. in Virology in 1969 from the University of Bristol and was
elected a Fellow of the Royal Society in 1998.

Required Vote

The six nominees receiving the highest number of affirmative votes of the
shares present or represented and entitled to be voted for them will be elected
as directors.

THE BOARD RECOMMENDS A VOTE IN
FAVOR OF EACH NAMED NOMINEE

BOARD OF DIRECTORS' MEETINGS AND COMMITTEES

The Board currently consists of six members. The Board met nine times,
including telephone conference meetings, during 2000, and acted by written
consent once. No nominated director attended fewer than 75% of the aggregate of
the total number of meetings of the Board and the total number of meetings held
by all committees of the Board on which he or she served (during the period
that he or she served).

Standing committees of the Board include an Audit Committee, a Compensation
Committee and a Finance Committee. The Company has no nominating committee.

Isaac Stein, Gordon Ringold and George Poste are the current members of the
Company's Audit Committee. Such members are "independent" as defined in Rule
4200(a)(15) of the NASD listing standards. The Audit Committee met five times
during 2000. The Audit Committee represents the Board in discharging its
responsibilities relating to the accounting, reporting, and financial practices
of the Company and its subsidiaries, and has general responsibility for
surveillance of internal controls and accounting and audit activities of the
Company and its subsidiaries. Specifically, the Audit Committee (i) reviews
prior to publication the Company's annual financial statements with management
and the Company's independent accountants, (ii) reviews with the Company's
independent accountants the scope, procedures and timing of the annual audits,
(iii) reviews the Company's accounting and financial reporting principles and
practices; (iv) reviews the adequacy and effectiveness of the Company's
internal accounting controls; (v) reviews the scope of other auditing services
to be performed by the independent accountants, (vi) reviews the independence
and effectiveness of the Company's independent accountants and their
significant relationships with the Company, (vii) recommends the retention or
appointment of the independent auditor of the Company, which is ultimately
accountable to the Board through the Audit Committee, (viii) reviews the
adequacy of the Company's accounting and financial personnel resources; (ix)
reviews the Audit Committee charter on an annual basis, (x) reviews with
management and the independent accountants quarterly financial results, and the
results of any significant matters identified as a result of the accountants'
review procedures, prior to filing any Form 10-Q and (xi) reviews any other
matters relative to the audit of the Company's accounts and the preparation of
its financial statements that the Audit Committee deems appropriate. The Board
has adopted the charter included as Annex A for the Audit Committee.

Isaac Stein, Robert Glaser and Gordon Ringold are the current members of the
Company's Compensation Committee. The Compensation Committee met or acted by
written consent 17 times during 2000. The Compensation Committee represents the
Board concerning salaries and incentive compensation for the Company's officers
and employees and administers the Company's employee benefit plans.

Isaac Stein, George Poste and Gordon Ringold are the current members of the
Company's Finance Committee. The Finance Committee was formed in March 2001 and
thus did not meet during 2000. The Finance Committee represents the Board
concerning financial matters not covered by the Audit Committee or Compensation
Committee and also represents the Board concerning corporate organizational
matters.

DIRECTOR COMPENSATION

The Company reimburses nonemployee directors for expenses incurred in
connection with attending Board and Committee meetings but it does not
compensate them for their services as Board or Committee members. The Company
has in the past granted nonemployee directors options to purchase common stock
pursuant to the terms of the Company's stock option plans, and the Board and
Compensation Committee continue to have the discretion to grant options to
nonemployee directors. Nonemployee directors receive nondiscretionary,
automatic grants of options to purchase 20,000 shares of common stock upon
joining the Board and nondiscretionary, automatic grants of options to purchase
5,000 shares of common stock each year pursuant to the 1999 Nonemployee
Directors Stock Option Plan.

COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

None of the members of the Company's Compensation Committee is currently, or
has ever been at any time since the Company's formation, one of the Company's
officers or employees, nor has any executive officer served as a member of the
board of directors or compensation committee of any entity that has one or more
executive officers serving as a member of our Board or Compensation Committee.

In March 1997, Isaac Stein issued a full recourse promissory note in the
amount of $120,000 in favor of Maxygen in connection with the purchase of
600,000 shares of Maxygen common stock. The promissory note was repaid in full
in January 2000.

In March 1998, Gordon Ringold issued a full recourse promissory note in the
amount of $99,000 in favor of Maxygen in connection with the exercise of an
option to purchase 600,000 shares of Maxygen common stock. The promissory note
was repaid in full in August 2000.

SECURITY OWNERSHIP OF CERTAIN BENEFICIAL
OWNERS AND MANAGEMENT

The following table sets forth the beneficial ownership of the Company's
common stock as of April 17, 2001 by (i) each stockholder that is known by the
Company to beneficially own more than 5% of the common stock, (ii) each of the
executive officers named in the Summary Compensation Table, (iii) each director
and (iv) all executive officers and directors as a group.

Percentage of ownership is based upon 33,805,914 shares outstanding as of
April 17, 2001. Beneficial ownership is calculated based upon Securities and
Exchange Commission requirements. All shares of the common stock subject to
options currently exercisable or exercisable within 60 days after April 17,
2001 are deemed to be outstanding for the purpose of computing the percentage
of ownership of the person holding such options, but are not deemed to be
outstanding for computing the percentage of ownership of any other person.
Unless otherwise indicated below, each stockholder named in the table has sole
or shared voting and investment power with respect to all shares beneficially
owned, subject to applicable community property laws. Unless otherwise
indicated in the table, the address of each individual listed in the table is
c/o Maxygen, Inc., 515 Galveston Drive, Redwood City, California 94063.

Number of Percentage
Shares of Shares
Beneficially Beneficially
Beneficial Owner Owned Owned
- ---------------- ------------ ------------

Glaxo Wellcome International BV(1).................. 6,406,643 19.0%
Huis ter Heideweg 62
3705 LZ Zeist
The Netherlands

R.A. Investment Group(2)............................ 2,279,485 6.7
200 West Madison, Suite 2500
Chicago, Illinois 60606

Technogen Associates, L.P.(3)....................... 2,024,772 6.0
275 Middlefield Road
Menlo Park, California 94025

Technogen Enterprises, L.L.C.(4).................... 2,024,772 6.0
275 Middlefield Road
Menlo Park, California 94025

Janus Capital Corporation(5)........................ 2,017,170 6.0
100 Fillmore Street
Denver, Colorado 80206-4923

Russell J. Howard(6)................................ 711,185 2.1

Simba Gill(7)....................................... 477,362 1.4

Lawrence Briscoe.................................... -- *

John Bedbrook(8) ................................... 56,124 *

Michael Rabson(9)................................... 363,224 1.1

Isaac Stein(10)..................................... 2,612,419 7.7

Robert J. Glaser(11)................................ 5,000 *

M.R.C. Greenwood(12)................................ 71,250 *

George Poste(13).................................... 80,000 *

Gordon Ringold(14).................................. 2,549,313 7.5

All directors and executive officers as a group (10 4,901,105 14.3
persons)(15).......................................

- --------
* Less than 1% of Maxygen's outstanding common stock.
(1) Includes 340,393 shares held by Glaxo Group Limited and 56,250 shares held
by Adrian Hennah for the benefit of GlaxoSmithKline plc. GlaxoSmithKline
plc, Glaxo Group Limited and Glaxo Wellcome International BV are under
common control.
(2) Based solely upon a Schedule 13G filed with the Securities and Exchange
Commission on April 6, 2001.
(3) Consists of 1,961,574 shares held by Technogen Associates, L.P. and 63,198
shares held by Technogen Enterprises, L.L.C. Technogen Enterprises, L.L.C.
and Technogen Associates, L.P. are under common control.
(4) Consists of 1,961,574 shares held by Technogen Associates, L.P. and 63,198
shares held by Technogen Enterprises, L.L.C. Technogen Enterprises, L.L.C.
and Technogen Associates, L.P. are under common control.
(5) Based solely upon a Schedule 13G filed with the Securities and Exchange
Commission on February 15, 2001.
(6) Includes 505,136 shares held by the Russell J. Howard & Maureen C. Howard
Trust, of which Dr. Howard is a trustee. Also includes 76,563 shares that
are subject to immediately exercisable options and 50,000 shares that may
be acquired within 60 days after April 17, 2001. As of April 17, 2001, the
Company has the right to repurchase 3,125 shares if Dr. Howard ceases to
be an employee, director or consultant of the Company.
(7) Includes 17,500 shares subject to immediately exercisable options and
includes 207,987 shares that are subject to the Company's right of
repurchase as of April 17, 2001 if Dr. Gill ceases to be an employee,
director or consultant of the Company.
(8) Includes 50,000 shares subject to immediately exercisable options.
(9) Includes 225,000 shares that are subject to the Company's right of
repurchase as of April 17, 2001 if Dr. Rabson ceases to be an employee,
director or consultant of the Company.
(10) Includes 1,961,574 shares of Maxygen common stock that are held by
Technogen Associates, L.P. and 63,198 shares held by Technogen
Enterprises, L.L.C. Technogen Managers, L.L.C. is the general partner of
Technogen Associates, L.P. Mr. Stein is a Managing Member of Technogen
Enterprises, L.L.C. and Technogen Managers, L.L.C. and disclaims
beneficial ownership of these shares except to the extent of his pecuniary
interest in the limited liability companies. Also includes 561,732 shares
held by the Stein 1995 Revocable Trust, of which Mr. Stein is a trustee.
Also includes 5,000 shares subject to an immediately exercisable option.
As of April 17, 2001, the Company has the right to repurchase all 5,000
shares issuable upon the exercise of this option if Mr. Stein ceases to be
an employee, director or consultant of the Company.
(11) Consists of 5,000 shares subject to an immediately exercisable option. As
of April 17, 2001, the Company has the right to repurchase all 5,000
shares issuable upon the exercise of this option if Dr. Glaser ceases to
be an employee, director or consultant of the Company.
(12) Consists of 71,250 shares that are subject to immediately exercisable
options. As of April 17, 2001, the Company has the right to repurchase
42,500 shares issuable upon exercise of these options if Dr. Greenwood
ceases to be an employee, director or consultant of the Company.
(13) Consists of 80,000 shares that are subject to immediately exercisable
options. As of April 17, 2001, the Company has the right to repurchase
61,250 shares issuable upon exercise of these options if Dr. Poste ceases
to be an employee, director or consultant of the Company.
(14) Includes 1,961,574 shares of Maxygen common stock that are held by
Technogen Associates, L.P. and 63,198 shares held by Technogen
Enterprises, L.L.C. Technogen Managers, L.L.C. is the general partner of
Technogen Associates, L.P. Dr. Ringold is a Managing Member of Technogen
Enterprises, L.L.C. and Technogen Managers, L.L.C. and disclaims
beneficial ownership of these shares except to the extent of his pecuniary
interest in the limited liability companies. Also includes 496,524 shares
held by the Gordon Ringold and Tanya Zarucki Trust, of which Dr. Ringold
is a trustee. Also includes 5,000 shares subject to an immediately
exercisable option. As of April 17, 2001, the Company has the right to
repurchase all 5,000 shares issuable upon the exercise of this option if
Dr. Ringold ceases to be an employee, director or consultant of the
Company.
(15) Includes shares included pursuant to notes (6)-(14).

EXECUTIVE COMPENSATION

Summary Compensation Table

The following table sets forth the compensation paid by Maxygen during 1998,
1999 and 2000 to the Chief Executive Officer and to the Company's four other
most highly compensated executive officers (the "named executive officers").

Long-Term
Annual Compensation Compensation
------------------------------ ------------
Awards
------------
Number of
Securities
Other Annual Underlying All Other
Name and Position Year Salary Bonus Compensation Options Compensation(1)
- ----------------- ---- -------- -------- ------------ ------------ --------------

Russell J. Howard........ 2000 $350,000 $ 70,000 $ -- 287,500 $915
Chief Executive Officer 1999 225,000 -- -- 172,500 832
and Director 1998 218,333 -- -- 200,000 833

Simba Gill(2)............ 2000 299,036 60,000 -- 245,000 807
President 1999 192,850 -- 1,500(3) 126,738 686
1998 99,750 10,000 55,414(4) 330,000 275

Lawrence Briscoe(5)......
Chief Financial Officer 2000 33,027 -- -- 200,000 --
and 1999 -- -- -- -- --
Senior Vice President 1998 -- -- -- -- --

Michael Rabson(6)........ 2000 280,000 70,000 -- 50,000 906
General Counsel and 1999 57,539 -- -- 350,000 686
Senior Vice President 1998 -- -- -- -- --

John Bedbrook(7)......... 2000 270,000 105,000 -- 25,000 899
President of Agriculture 1999 34,599 -- -- 200,000 310
1998 -- -- -- -- --

- --------
(1) Consists of term life insurance premiums paid by Maxygen on behalf of the
listed individual.
(2) Dr. Gill joined Maxygen in July 1998. His annualized salary for 1998 was
$190,000.
(3) Consists of $1,500 for reimbursement of relocation expenses.
(4) Consists of $19,550 in the form of a housing allowance and $35,864 for
reimbursement of relocation expenses.
(5) Mr. Briscoe joined Maxygen in November 2000. Mr. Briscoe's annualized
salary for 2000 was $280,000.
(6) Dr. Rabson joined Maxygen in September 1999. Dr. Rabson's annualized salary
for 1999 was $220,000.
(7) Dr. Bedbrook joined Maxygen in November 1999. Dr. Bedbrook's annualized
salary for 1999 was $212,500.

Stock Options Granted in 2000

The following table sets forth information with respect to stock options
granted during 2000 to each of the named executive officers. All options were
granted under Maxygen's 1997 Stock Option Plan. The options vest and are
exercisable in accordance with individual vesting schedules as described below.

The percentage of options granted is based on an aggregate of 3,262,210
options granted by Maxygen during 2000 to Maxygen's employees, including the
named executive officers. The potential realizable value amounts in the last
two columns of the following chart represent hypothetical gains that could be
achieved for the respective options if exercised at the end of the option term.
The assumed 5% and 10% annual rates of stock price appreciation from the date
of grant to the end of the option term are provided in accordance with

rules of the Securities and Exchange Commission and do not represent the
Company's estimate or projection of the future common stock price. Actual
gains, if any, on stock option exercises are dependent on the future
performance of the common stock, overall market conditions and the option
holder's continued employment through the period.

Individual Grants
---------------------------------------------
Potential Realizable
Value at Assumed Annual
Number of % of Total Rates of Stock Price
Securities Options Exercise Appreciation for Option
Underlying Granted to Price Terms
Options Employees in Per Expiration -----------------------
Name Granted Fiscal Year Share Date 5% 10%
---- ---------- ------------ -------- ---------- ----------- -----------

Russell J. Howard....... 287,500(1) 8.8% $56.875 6/28/10 $10,283,409 $26,060,179

Simba Gill.............. 195,000(2) 6.0 56.875 6/28/10 6,974,834 17,675,600
50,000(3) 1.5 56.875 6/28/10 1,788,419 4,532,205

Larry Briscoe........... 200,000(4) 6.1 32.00 11/30/10 4,024,926 10,199,952

Michael Rabson.......... 50,000(5) 1.5 24.23 12/26/10 761,905 1,930,819

John Bedbrook........... 25,000(6) 0.8 45.00 11/3/10 707,506 1,792,960

- --------
(1) The option vests and becomes exercisable as to 37,500 shares on July 1,
2000 as to 75,000 shares on July 1, 2001, as to 50,000 shares on July 1,
2003 and as to 125,000 shares on July 1, 2004.
(2) The option vests and becomes exercisable as to 17,500 shares on July 1,
2000 as to 17,500 shares on July 1, 2001, as to 10,000 shares on July 1,
2002, as to 50,000 shares on July 1, 2003 and as to 105,000 shares on July
1, 2004.
(3) The option vests and becomes exercisable as to 25,000 shares on July 1,
2003 and as to 25,000 shares on July 1, 2004.
(4) The option vests as to 50,000 shares on November 20, 2001 and as to an
additional 12.5% of the underlying shares on each six-month anniversary
thereafter until fully vested on November 20, 2004. If the Company
terminates Mr. Briscoe's employment other than for cause within twelve
months of a change of control of the Company, vesting will accelerate by an
additional eighteen months as of the date of termination.
(5) The option vests as to 25,000 shares on December 6, 2003 and to the
remaining 25,000 shares on December 6, 2004.
(6) The option vests as to 6,250 shares on each of November 2, 2001, November
2, 2002, November 2, 2003 and November 2, 2004.

Aggregated Option Exercises in 2000 and Fiscal-Year End Option Values

The following table sets forth certain information regarding exercised stock
options during 2000 and unexercised options held as of December 31, 2000 by
each of the named executive officers. The Company granted all options under the
1997 Stock Option Plan. The options vest and are exercisable in accordance with
individual vesting schedules. Under certain circumstances the vesting of Mr.
Briscoe's options will accelerate. See "Termination of Employment and Change of
Control Arrangements". The value of unexercised in-the-money options are based
on a value of $24.50 per share, the last reported sale price of the Company's
common stock on the Nasdaq National Market on December 30, 2000, minus the per
share exercise price, multiplied by the number of shares underlying the option.

Number of Securities
Underlying Unexercised Value of Unexercised In-
Number of Options at Fiscal Year- The-Money Options at
Shares End Fiscal Year-End
Acquired on Value ------------------------- -------------------------
Name Exercise Realized Exercisable Unexercisable Exercisable Unexercisable
---- ----------- -------- ----------- ------------- ----------- -------------

Russell J. Howard....... -- $-- 76,563 508,437 $938,996 $6,182,879
Simba Gill.............. -- -- 17,500 227,500 -- --
Lawrence Briscoe........ -- -- -- 200,000 -- --
Michael Rabson.......... -- -- -- 50,000 -- --
John Bedbrook........... -- -- 50,000 175,000 850,000 2,975,000

TERMINATION OF EMPLOYMENT AND CHANGE OF CONTROL ARRANGEMENTS

In the event of a merger or consolidation of the Company with or into
another corporation or entity in which the holders, as a group, of all of the
shares of the Company outstanding prior to the transaction hold, as a group,
less than 30% of the voting securities of the combined corporation or entity
after the transaction, all rights of repurchase the Company has on common stock
issued prior to December 16, 1999 will expire. As of April 17, 2001 the Company
had the right to repurchase 1,210,784 shares of its common stock issued prior
to December 16, 1999, 442,987 shares of which were held by directors and named
executive officers. See also "Security Ownership of Certain Beneficial Owners
and Management".

If within twelve months following the date of a change of control of the
Company either (i) the Company terminates Mr. Briscoe's employment other than
for cause or disability, (ii) Mr. Briscoe's employment with the Company
terminates as a result of his death or (iii) Mr. Briscoe terminates his
employment with the Company voluntarily with good reason, then the vesting
schedule of Mr. Briscoe's options will be accelerated by eighteen months as of
Mr. Briscoe's date of termination.

COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION

The Company's executive compensation program has been administered by the
Compensation Committee of the Board since September 1999. Prior to September
1999, compensation decisions and grants of stock options were made by the
Board. The current members of the Compensation Committee are Isaac Stein,
Robert Glaser and Gordon Ringold, each of whom is a non-employee director
within the meaning of Section 16 of the Exchange Act, and an "outside director"
within the meaning of Section 162(m) of the Internal Revenue Code of 1986, as
amended (the "Code"). The Compensation Committee is responsible for approving
and reporting to the Board on all elements of compensation for executive
officers. The Compensation Committee also reviews and approves various other
Company compensation policies and matters and administers the Company's 1997
Employee Stock Option Plan, 1999 Employee Stock Purchase Plan, 2000
International Stock Option Plan and 2001 Non-Officer Stock Option Plan.

The Compensation Committee has furnished the following report on executive
compensation. This report is being included pursuant to the Securities Exchange
Commission rules designed to enhance disclosure of

public companies' executive compensation policies. This report addresses the
Company's policies for 2000 as they affected the Company's Chief Executive
Officer and its other executive officers, including the named executive
officers in this Proxy Statement. This report shall not be deemed to be
"soliciting material"' or to be filed with the Securities and Exchange
Commission, nor shall any information in this report be incorporated by
reference into any past or future filing under the Securities Act or the
Exchange Act, except to the extent the Company specifically incorporates it by
reference into such filing.

Compensation Philosophy

The Company's executive compensation programs are based on the belief that
the interests of the executives should be closely aligned with the Company's
stockholders. To support this philosophy, a significant portion of each
executive's compensation is placed at risk and linked to the accomplishment of
specific results that are expected to lead to the creation of value for the
Company's stockholders from both the short-term and long-term perspectives. The
Company's compensation policies and programs are designed to:

. Attract, develop, reward and retain highly qualified and productive
individuals;

. Motivate executives to improve the overall performance and profitability
of the Company, as well as any business unit for which the executive is
responsible, and reward executives when specific results have been
achieved;

. Encourage accountability by adjusting salaries and incentive awards based
on each executive's individual performance, potential and contribution;

. Tie incentive awards to the performance of the Company's common stock to
further reinforce the linkage between the interests of the stockholders
and the executives; and

. Ensure compensation levels that are both externally competitive and
internally equitable.

In furtherance of these goals, the Company's executive compensation policies,
plans and programs consist of base salary, cash bonuses, stock option grants
and other benefits.

The Compensation Committee considers all elements of compensation and the
Company's compensation philosophy when determining individual components of
pay. The Compensation Committee does not follow any principles in a mechanical
fashion; rather, the members use their experience and judgment in determining
the mix of compensation for each individual. In addition to the experience and
knowledge of the Compensation Committee and the Company's Human Resources
staff, the Compensation Committee utilizes the services of independent human
resources consultants who provide competitive data from independent survey
sources of peer companies in competition for similar management talent. The
surveys include data from direct competitors of the Company and from other
companies in the biotechnology industry with similar size and performance
characteristics. Many of the companies included in these surveys are also
included in the Nasdaq Biotechnology Index (see "Company Stock Price
Performance").

While there is no specific formula that is used to set pay in relation to
this market data, executive officer base salary and individual bonus target
amounts are generally set in relation to the median total cash compensation
level for comparable jobs in the marketplace. However, when the Company's
business units meet or exceed financial and non-financial goals, amounts paid
under the Company's performance-based compensation program may lead to total
cash compensation levels that are higher than the median levels for comparable
jobs. The Compensation Committee also reviews the compensation levels of the
executive officers for internal consistency.

The Company intends to provide a total compensation opportunity for
executive officers that is above average, but with an above-average amount of
the total compensation opportunity at risk and dependent upon Company
performance. In all cases, the Compensation Committee considers the total
potential compensation payable to each of the executive officers when
establishing or adjusting any element of his or her compensation package.

Executive Compensation Components

The Company's executive compensation package consists primarily of the
following components:

Base salary. Executive base salaries are reviewed annually, and base salary
levels are generally targeted at or below the median of competitive data. The
base salaries of individual executives can and do vary from this salary
benchmark based upon such factors as the competitive environment, the
executive's experience level and scope of responsibility, current performance,
future potential and the overall contribution of the executive. The
Compensation Committee exercises its judgment based on all the factors
described above in making its decisions. No specific formula is applied to
determine the weight of each criterion.

In June 2000, due to the Company's recent transition to public company
status and considering data concerning competitive compensation, the
Compensation Committee approved increases in the base salaries of the executive
officers.

Cash Bonus. Executive officers are eligible to receive annual cash
performance bonuses of up to 25% of base salary. Bonuses are awarded based upon
individual achievement of goals and based upon the Company achieving specific
milestones.

Stock Options. The Compensation Committee views the grant of stock options
to be a key long-term incentive reward program. Executive officers, as well as
other employees, are eligible to receive periodic grants of incentive stock
options and non-qualified stock options pursuant to the Company's stock option
plans. Stock options are granted with an exercise price equal to the fair
market value of the underlying common stock on the date of grant. Vesting
periods for the options are utilized to encourage retention of executive
officers and reward long-term commitment to the Company. The Compensation
Committee believes that, because options are granted with an exercise price
equal to the market value of the common stock on the date of grant, they are an
effective incentive for employees to create value for the Company's
stockholders and are an excellent means of rewarding executives who are in a
position to contribute to the Company's long-term growth and profitability.
Although all executives are eligible to receive stock options, the award of any
stock option grant, as well as the size of the grant each executive receives,
is determined by the Compensation Committee. The Compensation Committee reviews
with the Vice President, Human Resources and Administration, and the Chief
Executive Officer (except in the case of his own stock option grants), and
approves individual stock option grants for each of the Company's executive
officers, including the named executive officers. The amount of each
executive's stock option grant is determined by the Compensation Committee
based upon the executive's individual performance, the executive's current
compensation package, the value of the executive's unvested stock options,
comparable company and competitive company practices, and the Compensation
Committee's appraisal of the executive's anticipated long-term future
contribution to the Company. The stock options granted to the named executive
officers in 2000 are set forth in the Summary Compensation and Stock Option
Grant tables.

Benefits. Benefits offered to executive officers serve a different purpose
than do the other elements of total compensation. In general, they provide a
safety net of protection against the financial catastrophes that can result
from illness, disability or death. Benefits offered to executives are the same
as those that are offered to the general employee population. The Compensation
Committee believes that the compensation paid or payable pursuant to life
insurance benefits and the benefit plans available to employees generally is
competitive with the benefit packages offered by comparable employers. From
time to time, the Company's Human Resources staff obtains data to ensure that
such benefit plans and programs remain competitive and reports its findings to
the Compensation Committee.

Chief Executive Officer Compensation

Dr. Howard's compensation package has been designed to encourage both short-
term and long-term performance of the Company as well as align his interests
with the interests of the stockholders. The majority

of his compensation, including stock options and cash bonus, is at risk. He
does not have an employment contract. The process of establishing the
compensation for the Chief Executive Officer and the criteria examined by the
Compensation Committee parallels the process and criteria used in establishing
compensation levels for the other executive officers. The Company's overall
performance and Dr. Howard's individual performance are critical factors in the
Compensation Committee's determination.

Dr. Howard's base salary as of December 31, 2000 was $350,000. The cash
bonus award paid to Dr. Howard for 2000 was $70,000. During 2000, he received
stock option grants under the 1997 Employee Stock Option Plan totaling 287,500
shares. These options vest over four years. The Compensation Committee's
decisions regarding Dr. Howard's stock option grants were based on its
subjective assessment of the importance of his leadership to the Company's
plans for substantial growth and his ability to enhance value for the Company's
stockholders, as well as its expectations for his future contributions in
leading the Company.

Policy Regarding Section 162 of the Internal Revenue Code

Section 162(m) of the Code limits the tax deductibility by a corporation of
compensation in excess of $1 million paid to its Chief Executive Officer and
any other of its four most highly compensated executive officers. Compensation
that qualifies as "performance-based" is excluded from the $1 million limit if,
among other requirements, the compensation is payable only upon attainment of
pre-established, objective performance goals under a plan approved by the
corporation's stockholders. Additionally, stock options will qualify for the
performance-based exception where, among other requirements, the exercise price
of the option is not less than the fair market value of the stock on the date
of grant. The Company ordinarily grants options only at fair market value.
Historically, the combined salary and bonus of each executive officer has been
well below the $1 million limit. The Compensation Committee's present intention
is to grant future compensation that does not exceed the limitations of Section
162(m), although the Compensation Committee reserves the right to award
compensation that does not comply with these limits on a case-by-case basis.

COMPENSATION COMMITTEE

Isaac Stein
Robert J. Glaser
Gordon Ringold

COMPANY STOCK PRICE PERFORMANCE

The following graph shows the cumulative total stockholder return of an
investment of $100 in cash on December 16, 1999, the date the Company's common
stock began to trade on the Nasdaq National Market, through December 30, 2000,
the last date of trading of 2000 for (i) the Company's common stock, (ii) the
Nasdaq Stock Market (U.S) Index and (iii) the Nasdaq Biotechnology Index. All
values assume reinvestment of the full amount of all dividends. Stockholder
returns over the indicated period should not be considered indicative of future
stockholder returns.

[PERFORMANCE GRAPH]

Total Return Analysis

12/16/1999 12/31/2000 12/30/2001
---------- ---------- ----------

Maxygen, Inc............................. 100 443.75 153.13
Nasdaq Stock Market Index................ 100 109.70 65.95
Nasdaq Biotechnology Index............... 100 126.78 155.91

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

RELATED PARTY TRANSACTIONS

Since January 1, 2000, there has not been, nor is there currently proposed,
any transaction or series of similar transactions to which the Company was or
is to be a party in which the amount involved exceeds $60,000 and in which any
current director, executive officer or holder of more than 5% of the Company's
common stock had or will have a direct or indirect interest, nor has any such
person been indebted to the Company in an amount in excess of $60,000, other
than (1) compensation and other arrangements, which are described under
"Director Compensation", "Executive Compensation" or "Termination of Employment
and Change of Control Arrangements" and (2) the transactions described below.

In March 1997, in connection with the formation of the Company, the Company
made loans to Russell Howard and Isaac Stein to help such persons purchase
common stock of the Company. The loans were evidenced by full recourse
promissory notes and secured by the common stock underlying the stock
purchases. The promissory notes had interest rates of 6.42% per year, and
interest payments on the notes were due and payable on June 30 and December 31
of each year. Unpaid principal and interest on the notes was to be due and
payable on the earlier of 30 days after the participant ceased to be an
employee, director or consultant of the Company, or three years after the date
of the promissory note. Each of the promissory notes was repaid in full during
2000. The original principal amount of each such promissory note and the
principal amount of each such promissory note at the time of repayment are set
forth below.

Original Note Note Amount
Director or Executive Officer Amount at Repayment
----------------------------- ------------- ------------

Russell J. Howard.............................. $60,000 $60,000

Isaac Stein.................................... 120,000 98,000

In March 1998, the Company made a loan to Gordon Ringold to help Dr. Ringold
exercise an option to purchase common stock of the Company. The loan, in the
amount of $99,000, was evidenced by a full recourse promissory note and secured
by the common stock underlying the stock purchase. The promissory note had an
interest rate of 5.59% per year and interest payments on the notes were due and
payable on June 30 and December 31 of each year. Unpaid principal and interest
on the note was due and payable on the earlier of 30 days after Dr. Ringold
ceased to be an employee, director or consultant of the Company, or three years
after the date of the promissory note. The promissory note was repaid in full
in July 2000. The principal amount of the promissory note at the time of
repayment was $99,000.

In October 1999, the Company loaned certain current named executive officers
funds used to exercise options to purchase Company common stock. These
individuals paid the exercise price for their outstanding options, in part,
pursuant to full recourse promissory notes secured by the common stock
underlying the options. The notes bear interest at 5.59% per year, and interest
payments on the notes are due and payable on June 30 and December 31 of each
year. Unpaid principal and interest on the notes are due and payable on the
earlier of 30 days after the individual ceases to be an employee, director or
consultant of the Company, or three years after the date of the promissory
note. As of April 17, 2001, the original and outstanding principal amounts of
each promissory note by a named executive officer are set forth below.

Original and
Outstanding
Director or Executive Officer Note Amount
----------------------------- ------------

Simba Gill................................................... $173,163

Russell J. Howard............................................ 47,250

Michael Rabson............................................... 236,250

The Company has entered into indemnification agreements with each of its
directors and executive officers. These agreements require the Company to
indemnify such individuals, to the fullest extent permitted by Delaware law,
for certain liabilities to which they may become subject as a result of their
affiliation with the Company.

STOCKHOLDER PROPOSALS

The deadline for submitting a stockholder proposal for inclusion in the
Company's proxy statement and form of proxy for the Company's 2002 Annual
Meeting of Stockholders pursuant to Rule 14a-8 of the Securities and Exchange
Commission is December 28, 2001. Stockholders wishing to submit proposals or
director nominations that are not to be included in such proxy statement and
proxy must do so in accordance with the Company's bylaws. Stockholders are also
advised to review the Company's bylaws, which contain additional requirements
with respect to advance notice of stockholder proposals and director
nominations including a requirement that the Company receive notice of any
proposal or nomination at least 120 days before the first anniversary of the
2000 Annual Meeting of Stockholders.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16 of the Exchange Act requires the Company's directors and
executive officers, and persons who own more than 10% of the Company's common
stock to file initial reports of ownership and reports of changes in ownership
with the Securities and Exchange Commission. Such persons are required by
Securities and Exchange Commission regulation to furnish the Company with
copies of all Section 16(a) forms that they file.

Based solely upon its review of the copies of such forms furnished to the
Company and written representations from the executive officers and directors,
the Company believes that all Section 16(a) filing requirements were met during
2000.

INDEPENDENT PUBLIC ACCOUNTANTS

The Board, upon the recommendation of its Audit Committee, has appointed
Ernst & Young LLP to serve as the Company's independent auditors for 2001.
Representatives of Ernst & Young LLP will be present at the annual meeting to
answer appropriate questions. They will also have the opportunity to make a
statement if they desire to do so.

Audit Fees

The aggregate fees billed for professional services rendered for the audit
of the Company's annual financial statements for the fiscal year ended December
31, 2000, and for the reviews of the financial statements included in the
Company's quarterly reports on Form 10-Q for that fiscal year, were $225,035,
all of which were attributable to Ernst & Young LLP.

Financial Information Systems Design and Implementation Fees

Ernst & Young LLP did not render professional services relating to financial
information systems design and implementation for the fiscal year ended
December 31, 2000.

All Other Fees

The aggregate fees billed by Ernst & Young LLP for services rendered to the
Company, other than the services described above under "Audit Fees" for the
fiscal year ended December 31, 2000, were $427,211. The vast majority of these
fees relate to audit and tax activities in support of the Company, including
services rendered in connection with the Company's initial public offering and
follow on offering, and the acquisition of Maxygen ApS.

The Audit Committee has determined that the rendering of non-audit services
by Ernst & Young LLP was compatible with maintaining their independence.

Audit Committee Report/1/

The Audit Committee reviews the Company's financial reporting process on
behalf of the Board. Management has the primary responsibility for the
financial statements and the reporting process, including the system of
internal controls.

In this context, the Audit Committee has met and held discussions with
management and the independent auditors. Management represented to the Audit
Committee that the Company's consolidated financial statements were prepared in
accordance with generally accepted accounting principles, and the Audit
Committee has reviewed and discussed the consolidated financial statements with
management and the independent auditors. The Audit Committee has discussed with
the independent auditors matters required to be discussed by Statement on
Auditing Standards No. 61 (Communication With Audit Committees).

In addition, the Audit Committee has discussed with the independent auditors
the auditors' independence from the Company and its management, including the
matters in the written disclosures required by the Independence Standards Board
Standard No. 1 (Independence Discussions With Audit Committees). The Audit
Committee has received the letter from the independent accountants required
therein. The Audit Committee has also considered whether the independent
auditors' provision of information technology and other non-audit services to
the Company is compatible with the auditors' independence.
- --------
/1 /This report shall not be deemed to be "soliciting material" or to be filed
with the Securities and Exchange Commission, nor shall any information in
this report be incorporated by reference into any past or future filing
under the Securities Act or the Exchange Act, except to the extent the
Company specifically incorporates it by reference into such filing.

The Audit Committee discussed with the Company's internal and independent
auditors the overall scope and plans for their respective audits. The Audit
Committee meets with the internal and independent auditors, with and without
management present, to discuss the results of their examinations, the
evaluations of the Company's internal controls, and the overall quality of the
Company's financial reporting.

In reliance on the reviews and discussions referred to above, the Audit
Committee recommended to the Board, and the Board has approved, that the
audited financial statements be included in the Company's Annual Report on Form
10-K for the year ended December 31, 2000, for filing with the Securities and
Exchange Commission. The Audit Committee and the Board also have approved the
selection of the Company's independent auditors.

AUDIT COMMITTEE

Isaac Stein
Gordon Ringold
George Poste

ADDITIONAL INFORMATION

The Company's Annual Report for the fiscal year ended December 31, 2000 is
being mailed with this Proxy Statement to stockholders of the Company.

OTHER BUSINESS

The Board does not presently intend to bring any other business before the
meeting, and, so far as is known to the Board, no matters are to be brought
before the meeting except as specified in the Notice of the Meeting. As to any
business that may properly come before the meeting, however, it is intended
that proxies, in the form enclosed, will be voted in respect thereof in
accordance with the judgment of the persons voting such proxies.

By Order of the Board of Directors
/s/ Julian Stern
Julian Stern
Secretary

Annex A

AUDIT COMMITTEE CHARTER

Adopted by the Board of Directors of
Maxygen, Inc.
April 26, 2000

Composition:

The Audit Committee shall be composed of three or more directors, as
determined by the board of directors, who shall meet the independence and
financial literacy requirements of NASDAQ, and at least one of whom shall have
past employment experience in finance or accounting, requisite professional
certification in accounting, or any other comparable experience or background
which results in the individual's financial sophistication, including being or
having been a chief executive officer, chief financial officer or other senior
officer with financial oversight responsibilities.

Unless a chair is designated by the board of directors, the Audit Committee
members may appoint their own chair by majority vote.

Responsibilities

1. Recommend to the board of directors the selection of the independent
auditor, evaluate the performance of the independent auditor and, if so
determined by the Audit Committee, recommend to the board of directors
replacement of the independent auditor; it being acknowledged that the
independent auditor is ultimately accountable to the board of directors and the
Audit Committee, as representatives of the stockholders.

2. Ensure the receipt of, and evaluate, the written disclosures and the
letter that the independent auditor submits to the Audit Committee regarding
the auditor's independence in accordance with Independence Standards Board
Standard No. 1, discuss such reports with the auditor and, if so determined by
the Audit Committee in response to such reports, recommend that the board of
directors take appropriate action to address issues raised by such evaluation.

3. Discuss with the independent auditor the matters required to be discussed
by SAS 61, as it may be modified or supplemented.

4. Instruct the independent auditor and the internal auditor that the Audit
Committee expects to be advised if there are any subjects that require special
attention.

5. Meet with management and the independent auditor to discuss the annual
financial statements and the report of the independent auditor thereon, and to
discuss significant issues encountered in the course of the audit work,
including restrictions on the scope of activities, access to required
information and the adequacy of internal financial controls.

6. Review the management letter delivered by the independent auditor in
connection with the audit.

7. Following such review and discussions, if so determined by the Audit
Committee, recommend to the board of directors that the annual financial
statements be included in the Company's annual report.

8. Meet quarterly with management and the independent auditor to discuss the
quarterly financial statements prior to the filing of the Form 10-Q once the
Company becomes required by the rules of the Securities and Exchange Commission
to file such form; provided that this responsibility may be delegated to the
chairman of the Audit Committee.

9. Meet at least once each year in separate executive sessions with
management, the internal auditor, if any, and the independent auditor to
discuss matters that any of them or the Audit Committee believes could
significantly affect the financial statements and should be discussed
privately.

10. Have such meetings with management, the independent auditor and the
internal auditor as the Audit Committee deems appropriate to discuss the
concept and design of the Company's information and reporting systems and the
steps management has taken or should consider taking to address significant
issues concerning those matters, and to discuss significant financial risk
exposures facing the Company and the steps management has taken or should
consider taking to monitor and control such exposures.

11. Review significant changes to the company's accounting principles and
practices proposed by the independent auditor, the internal auditor, if any, or
management.

12. Review the scope and results of internal audits.

13. Evaluate the performance of the internal auditor, if any, and, if so
determined by the Audit Committee, recommend replacement of the internal
auditor, if any.

14. Conduct or authorize such inquiries into matters within the Audit
Committee's scope of responsibility as the Audit Committee deems appropriate.
The Audit Committee shall be empowered to retain independent counsel and other
professionals to assist in the conduct of any such inquiries.

15. Provide minutes of Audit Committee meetings to the board of directors,
and report to the board of directors on any significant matters arising from
the Audit Committee's work.

16. At least annually, review and reassess this charter and, if appropriate,
recommend proposed changes to the board of directors.

17. Prepare any report that may be required by the rules of the Securities
and Exchange Commission to be included in the Company's annual proxy statement
at such time as the Company becomes subject to such rules.

18. In the performance of its responsibilities, the Audit Committee is the
representative of the stockholders. However, it is not the responsibility of
the Audit Committee to plan or conduct audits, or to determine whether the
Company's financial statements are complete and accurate or in accordance with
generally accepted accounting principles.

MAXYGEN, INC.

PROXY FOR ANNUAL MEETING OF STOCKHOLDERS OF MAXYGEN, INC. JUNE 1, 2001

THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF MAXYGEN, INC.

The undersigned hereby appoints Lawrence Briscoe and Michael Rabson, or either
of them, each with full power of substitution, to represent the undersigned at
the Annual Meeting of Stockholders of Maxygen, Inc. (the "Company") to be held
at 1:00 p.m. local time on Friday, June 1, 2001, at the Stanford Park Hotel, 100
El Camino Real, Menlo Park, California 94025, and at any adjournments or
postponements thereof, and to vote the number of shares the undersigned would be
entitled to vote if personally present at the meeting on the following matters:

THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED. WHEN NO CHOICE IS
INDICATED, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE SIX NOMINEES AND FOR
ALL OTHER PROPOSALS. In their discretion, the proxy holders are authorized to
vote upon such other business as may properly come before the meeting or any
adjournments or postponements thereof to the extent authorized by Rule 14a-4(c)
promulgated under the Securities Exchange Act of 1934, as amended.

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YOUR VOTE IS IMPORTANT. WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING, PLEASE
COMPLETE AND PROMPTLY RETURN THE ACCOMPANYING PROXY IN THE ENCLOSED POSTAGE-
PAID ENVELOPE SO THAT YOUR SHARES MAY BE REPRESENTED AT THE MEETING. YOU MAY
ALSO VOTE VIA THE TELEPHONE OR OVER THE INTERNET, AS DESCRIBED IN THE PROXY
STATEMENT
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(Continued, and to be marked, dated and signed, on the reverse side)

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*FOLD AND DETACH HERE*

VOTE BY TELEPHONE OR INTERNET

QUICK * EASY * IMMEDIATE * AVAILABLE 24 HOURS A DAY * 7 DAYS A WEEK

Maxygen encourages you to take advantage of the new and convenient way to vote
your shares. If voting by proxy, this year you may vote by mail, or choose one
of the two methods described below. Your telephone or internet vote authorizes
the named proxies to vote your shares in the same manner as if you marked,
signed, and returned your proxy card. To vote by telephone or internet, read the
accompanying proxy statement and then follow these easy steps:

* To vote by telephone call toll free on a touch tone telephone 1-800-840- 1208-
anytime. There is NO CHARGE to you for this call. Enter the 11 digit control
number located in the lower right hand corner.

OPTION #1: To vote as the Board of Directors recommends on ALL Items: Press 1.

WHEN ASKED, PLEASE CONFIRM YOUR VOTE BY PRESSING 1.

OPTION #2: If you choose to vote on each Item separately, press 0. You will hear
these instructions:

Item 1: To vote FOR ALL nominees, press 1: to WITHHOLD FOR ALL nominees, press
9.

To withhold FOR AN INDIVIDUAL nominee, press 0 and listen to the
instructions.

WHEN ASKED, PLEASE CONFIRM BY PRESSING 1.

2. TO VOTE BY INTERNET: FOLLOW THE INSTRUCTIONS AT OUR INTERNET ADDRESS:
http//www.eproxy.com/maxy

PLEASE DO NOT RETURN THE ABOVE PROXY CARD IF VOTED BY PHONE OR INTERNET.

Call * * Toll Free * * On a Touch Tone Telephone

1-800-840-1208 - ANYTIME

There is NO CHARGE to you for this call.

THE BOARD OF DIRECTORS RECOMMENDS THAT YOU VOTE FOR THE ELECTION OF THE SIX
NOMINEES.

Please mark [X]
your votes as in
this example

1. ELECTION OF DIRECTORS FOR all nominees listed WITHHOLD
below (except as AUTHORITY
indicated to the to vote for all of the
contrary below) nominees listed below
[ ] [ ]

Nominees:
Russell J. Howard M.R.C. Greenwood
Isaac Stein Gordon Ringold
Robert J. Glaser George Poste

Instruction: To withhold authority to vote for any individual nominee,
write that nominee's name in the space provided below:

____________________________________________________________

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

The foregoing items of business are more fully described in the Proxy Statement
accompanying this Notice. Only stockholders of record at the close of business
on April 17, 2001 are entitled to notice of, and to vote at, the meeting or any
adjournment thereof.

YOUR VOTE IS IMPORTANT. WHETHER OR
NOT YOU PLAN TO ATTEND THE MEETING,
PLEASE COMPLETE AND PROMPTLY RETURN
THE ENCLOSED PROXY IN THE ENVELOPE
PROVIDED SO THAT YOUR SHARES MAY BE
REPRESENTED AT THE MEETING.

____________________________________________________ Date ______________, 2001
Signature (print title, if applicable)

Please sign exactly as your name(s) appear(s) on your stock certificate. If
shares of stock stand of record in the names of two or more persons or in the
name of husband and wife, whether as joint tenants or otherwise, both or all of
such persons should sign the proxy. If shares of stock are held of record by a
corporation, the proxy should be executed by the president or vice president and
the secretary or assistant secretary. Executors, administrators or other
fiduciaries who execute the above proxy for a deceased stockholder should give
their full title. Please date the Proxy.

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*FOLD AND DETACH HERE*