THIS CONSULTANCY CONTRACT is made on the 30th day of August 2002



BETWEEN



(1)     deCODE genetics, Inc., a Delaware

        Corporation with its principal place of business at

        Sturlugata 8

        IS-101 Reykjavik

        Iceland ("Company")



(2)     Vane Associates, a partnership,

        "White Angles"

        7 Beech Dell

        Keston Park

        Keston

        Kent  BR2 6EP

        Great Britain ("Consultant")





IT IS AGREED:-





1     ENGAGEMENT OF SERVICES



      Consultant shall procure that Professor Sir John Vane ("Sir John Vane")

      acts as director and will serve as a member of the Company's Board of

      Directors (the "Board") and perform the duties of a director, in

      accordance with the Company's Amended and Restated Articles of

      Incorporation, Bylaws, and the General Corporation Law of Delaware (the

      "Services"). The Services will take place from time to time as reasonably

      requested by the Company at times mutually acceptable to Consultant and

      the Company at meetings in either Reykjavik or, occasionally, in Boston,

      Massachusetts. Sir John Vane may participate in such meetings by

      teleconference. It is anticipated that the Board will meet approximately

      five times per year and that Sir John Vane's time commitment per year to

      the Company shall not materially exceed that number of days.

{PAGE}

2     COMMENCEMENT



      This Agreement shall be deemed to commence with effect from August 30,

      2002 ("Commencement Date") and shall continue until the close of business

      on the third anniversary of the date of this Agreement and thereafter

      until terminated by either party upon 90 days' written notice to each

      other.



3     COMPENSATION



      In consideration of the Consultant's Services and subject to approval by

      the Company's Board of Directors, which shall be confirmed to Consultant

      prior to commencement, the Company shall pay to Vane Associates:



3.1   an annual retainer of US$12,000 per annum paid in advance on the

      Commencement Date and on each anniversary of the Commencement Date during

      the continuation of this Agreement, pro-rated for part quarters worked at

      the end of the Agreement (if applicable).



3.2   US$3,000 per day for each Board Meeting that Sir John Vane attends whether

      personally or by telephone participation and for each other day on which

      Sir John Vane provides services to the Company at the Company's request

      and



3.3   In addition the Company shall grant Sir John Vane non statutory stock

      options ("Options") to purchase up to 60,000 Company shares of common

      stock of the Company at closing market price on the day prior to the

      Commencement Date on the terms and conditions contained in the stock

      option grant agreement attached as an exhibit hereto The Options shall be

      deemed granted upon signature of this Agreement and the Company shall

      forthwith take such steps and execute such documents necessary to give

      effect to this obligation forthwith upon your signature of this Agreement.



4     FEES



4.1   The Consultant will be entitled to receive the fee referred to above

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