UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8–K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the

Securities Exchange Act of 1934

~~September~~October 712, 2010 (October 8, 2010)

Date of Report (Date of earliest event reported)

ZYMOGENETICS, INC.

(Exact name of registrant as specified in its charter)

Washington	000-33489	91-1144498
(State or other jurisdiction of incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)
1201 Eastlake Avenue East Seattle, Washington		98102-3702
(Address of principal executive offices)		(Zip Code)

1201 Eastlake Avenue East Seattle, Washington		98102-3702
(Address of principal executive offices)		(Zip Code)

(206) 442-6600

(Registrant’s telephone number, including area code)

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2.):

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) ¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) ¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) ¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

¨Item ~~Soliciting~~1.02. ~~material~~Termination ~~pursuant~~of toa ~~Rule~~Material ~~14a-12~~Definitive ~~under the Exchange Act (17 CFR 240~~Agreement.~~14a-12)~~

¨On ~~Pre-commencement~~September 7, ~~communications~~2010, ~~pursuant~~ZymoGenetics, toInc., ~~Rule~~a ~~14d-2~~Washington corporation (bthe “Company”), ~~under~~entered into an Agreement and Plan of Merger (the “Merger ~~Exchange~~Agreement”) ~~Act~~with Bristol-Myers Squibb Company, a Delaware corporation (17“Parent”), ~~CFR~~and ~~240~~Zeus Acquisition Corporation, a Washington corporation and a wholly owned subsidiary of Parent (“Merger Sub”).~~14d-2~~ Pursuant to the Merger Agreement and upon the terms and subject to the conditions thereof, Merger Sub commenced a tender offer (bthe “Offer”) to acquire all of the issued and outstanding shares of voting common stock, without par value, of the Company (the “Shares”) for $9.75 per Share, net to the holder thereof in cash, without interest and subject to applicable withholding. At 12:00 midnight, New York City time, on October 7, 2010, the Offer expired as scheduled. The Offer was not extended. Based on the information provided by the Depositary to Parent, as of the expiration of the Offer, approximately 82,605,529 Shares were validly tendered and not validly withdrawn prior to the expiration of the Offer. As of the close of business on October 11, 2010, approximately 981,756 Shares remained subject to guaranteed delivery procedures. On October 8, 2010, Merger Sub accepted for payment all Shares validly tendered and not validly withdrawn in the Offer. The Shares validly tendered and not validly withdrawn represented approximately 94.9% of the Shares outstanding.

¨Upon ~~Pre-commencement~~Merger ~~communications~~Sub’s acceptance ~~pursuant~~for payment of all Shares validly tendered and not validly withdrawn in the Offer, the Company repaid and satisfied all borrowings, redemption amounts, accrued and unpaid interest and royalty payments outstanding under the Company’s funding arrangements with Deerfield Private Design Fund, L.P., Deerfield Private Design International, L.P. and Deerfield ZG Corporation (collectively, the “Deerfield Funds”). The financing agreements between the Company and the Deerfield Funds, including (i) the Facility Agreement dated June 26, 2008, between the Company and the Deerfield Funds (as amended from time to ~~Rule~~time, ~~13e-4~~the “Facility Agreement”), (cii) the ~~under~~Promissory Notes dated June 26, 2008 (the “Promissory ~~Exchange~~Notes”), ~~Act~~(iii) the Royalty Agreement dated June 26, 2008, between the Company and the Deerfield Funds (17as ~~CFR~~amended ~~240.13e-4~~from time to time, the “Royalty Agreement”), (civ) the Warrants issued by the Company to the Deerfield Funds on November 5, 2008 (the “Warrants”), and (v) the Registration Rights Agreement dated June 26, 2008, between the Company and the Deerfield Funds (as amended from time to time, the “Registration Rights Agreement” and together with the Facility Agreement, the Promissory Notes, the Royalty Agreement and the Warrants, the “Deerfield Financing Documents”), were each terminated and are of no further force or effect as of October 8, 2010.

~~Item~~A summary of the terms of the Deerfield Financing Documents is set forth in the Form 8-K filed by the Company with the Securities and Exchange Commission (the “SEC”) on June ~~1.01~~30, ~~Entry~~2008, ~~into~~which asummary ~~Material~~is ~~Definitive~~incorporated ~~Agreement~~by reference in this Item 1.02.

~~Agreement~~Item ~~and~~3.01. ~~Plan~~Notice of ~~Merger~~Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.

OnThe ~~September 7,~~effective ~~2010,~~time ~~ZymoGenetics,~~(“Effective ~~Inc.,~~Time”) aof ~~Washington~~the ~~corporation~~merger (the “~~Company~~Merger”), ~~entered~~of ~~into~~the anCompany ~~Agreement~~into ~~and Plan~~Merger ofSub with Merger Sub continuing as the surviving corporation (the “~~Merger~~Surviving ~~Agreement~~Corporation”) ~~with~~occurred ~~Bristol-Myers~~on ~~Squibb~~October 12, ~~Company~~2010. On October 12, a2010, ~~Delaware~~the ~~corporation~~Company notified The NASDAQ Global Market (“~~Parent~~NASDAQ”), ~~and~~of ~~Zeus~~the ~~Acquisition~~effectiveness ~~Corporation,~~of athe ~~Washington~~Merger. ~~corporation~~As ~~and~~ a ~~wholly~~result ~~owned subsidiary~~ of ~~Parent~~the (“Merger, ~~Sub”).~~the ~~Pursuant~~Company tono longer meets the ~~Merger~~numerical ~~Agreement~~listing ~~and~~requirements ~~upon~~of NASDAQ. The Company also notified NASDAQ that the ~~terms~~Shares issued and ~~subject~~outstanding immediately prior to the ~~conditions~~Effective ~~thereof,~~Time (other than Shares owned by Parent or Merger Sub, Shares ~~will~~owned ~~commence~~by athe ~~tender~~Company ~~offer~~as ~~(the~~treasury ~~“Offer”)~~stock toor ~~acquire~~Shares ~~all~~held ofby ~~the~~shareholders ~~issued~~who ~~and~~properly ~~outstanding~~exercise ~~shares~~their ~~of voting~~dissenters’ ~~common~~rights ~~stock,~~pursuant ~~without~~to ~~par~~and ~~value,~~in ofcompliance with the ~~Company~~Washington Business Corporation Act (the “~~Shares~~WBCA”)), ~~for~~were converted into the right to receive $9.75 per ~~share,~~Share net to the ~~holder~~selling ~~thereof~~shareholder in cash, without interest and ~~subject~~less toany ~~applicable~~required withholding taxes (~~such~~the ~~amount~~“Merger Consideration”), and requested that NASDAQ file with the SEC an application on Form 25 to report that the Shares are no longer listed on NASDAQ. Trading of the Shares on NASDAQ has been suspended effective as of the close of business on October 12, 2010. The Company intends to file with the SEC a Form 15 under the Securities Exchange Act of 1934, as amended (the “~~Offer~~Exchange ~~Price~~Act”), requesting the deregistration of the Shares and the suspension of the Company’s reporting obligations under Section 13 and 15(d) of the Exchange Act.

OnItem ~~September 7,~~3.03. ~~2010,~~Material ~~the~~Modification ~~Company~~to ~~and~~Rights ~~Parent issued a joint press release announcing that they had entered into the Merger Agreement. A copy~~ of ~~the~~Security ~~press release was previously furnished by the Company on Schedule 14D-9C, filed with the Securities and Exchange Commission on September 7, 2010~~Holders.

~~Under~~The ~~the~~information ~~Merger~~set ~~Agreement,~~forth ~~Merger~~above ~~Sub~~in ~~will commence~~ the ~~Offer~~first ~~within~~paragraph ~~seven~~under ~~business days after September~~Item ~~7, 2010~~1.02 Inis ~~the~~incorporated ~~Offer, each Share validly tendered and not withdrawn will be accepted for payment~~ by ~~Merger~~reference ~~Sub~~into inthis ~~accordance with the terms of the Offer (but in no event sooner than 20 business days after the commencement of the Offer)~~Item 3.03.

Pursuant to the Merger Agreement, following the consummation of the Offer, and subject to the satisfaction or waiver of certain conditions set forth in the Merger Agreement, either (i) Merger Sub will merge with and into the Company, with the Company as the surviving corporation in the merger (the “Long Form Merger”) or (ii) in the event (x) Parent and Merger Sub acquire at least 90% of the issued and outstanding Shares, including through exercise of the Top-Up Option (defined below), and (y) after consummation of the Offer, Parent elects to cause a merger of the Company into Merger Sub, the Company will merge with and into Merger Sub, with Merger Sub as the surviving corporation in the merger under the “short form” merger procedures available under Washington Law (the “Short Form Merger,” and either the Long-Form Merger or the Short-Form Merger, the “Merger”). The Short-Form Merger may be effected without additional approval by the Company’s shareholders. Otherwise, the Company will hold a special shareholders’ meeting to obtain shareholder approval of the Long-Form Merger. Consummation of the Merger is subject to shareholder approval, if required, and the absence of laws or court orders prohibiting the Merger.

At the effective time of the Merger (the “Effective Time”), all remaining outstanding Shares not tendered in the Offer (other than Shares owned by Parent or Merger Sub, Shares owned by the Company as treasury stock or Shares held by shareholders who properly exercise their dissenters’ rights pursuant to and in compliance with the Washington Business Corporation Act (the “WBCA”)) will be cancelled and converted into the right to receive the Offer Price in cash, without interest and subject to applicable withholding.

~~Merger~~In ~~Sub’s~~connection ~~obligation~~with tothe ~~accept~~consummation ~~for~~of ~~payment~~the ~~and~~Merger, ~~pay~~each ~~for~~Share ~~all~~issued ~~Shares~~and ~~validly~~outstanding ~~tendered pursuant~~immediately toprior to the ~~Offer~~Effective isTime ~~subject~~(other tothan ~~(i) the~~Shares ~~termination~~owned orby ~~expiration~~Parent ofor ~~the~~Merger ~~applicable~~Sub, ~~waiting~~Shares ~~period~~owned ~~under~~by the ~~Hart-Scott-Rodino~~Company ~~Antitrust~~as ~~Improvements~~treasury ~~Act~~stock ofor ~~1976,~~Shares asheld ~~amended,~~by ~~(ii) at~~shareholders ~~least~~who ~~48,282,192~~properly ~~Shares~~exercise ~~plus~~their ~~50%~~dissenters’ ofrights ~~any~~pursuant ~~equity interests~~to ofand ~~the~~in ~~Company~~compliance ~~granted~~with orthe ~~issued~~WBCA) ~~after~~was cancelled ~~August 31,~~and ~~2010~~converted ~~(other~~into ~~than~~the ~~pursuant~~right to receive the ~~exercise~~Merger ofConsideration. ~~outstanding~~At ~~options~~the Effective Time, ~~restricted~~the ~~stock~~Company’s ~~units~~shareholders orimmediately ~~warrants)~~prior ~~having~~to ~~been~~the ~~tendered~~Effective ~~and~~Time ~~not~~ceased ~~withdrawn~~to athave ~~the~~any ~~expiration~~rights ofas shareholders in the ~~Offer~~Company ~~and~~ (~~iii)~~ other ~~customary~~than ~~closing~~their right ~~conditions.~~to ~~Neither~~receive the ~~Offer~~Merger ~~nor~~Consideration) ~~the~~and ~~Merger~~accordingly isno ~~subject~~longer tohave aany ~~financing~~interest ~~condition~~in the Company’s future earnings or growth.

Subject to the terms of the Merger Agreement, the Company has granted Merger Sub an irrevocable option (the “Top-Up Option”), exercisable only after acceptance by Merger Sub of, and payment for, Shares tendered in the Offer and on the terms and conditions set forth in the Merger Agreement, to purchase newly issued Shares at the Offer Price in an amount that, when added to the Shares already owned by Parent and Merger Sub following consummation of the Offer, constitutes one share more than 90% of the issued and outstanding Shares on a fully-diluted basisItem 5. In no event will the Top-Up Option be exercisable for a number of Shares in excess of the total number of the Company’s then authorized but unissued shares (less any shares committed or reserved for issuance)01. ~~The~~Changes ~~Top-Up Option is not exercisable unless, immediately after such exercise and the issuance of Shares pursuant thereto, Parent and Merger Sub will then hold,~~ in ~~the~~Control ~~aggregate, at least 90%~~ of ~~the issued and outstanding Shares~~Registrant. Parent or Merger Sub will pay the Offer Price for the Shares acquired upon exercise of the Top-Up Option, at their election, either in cash or by delivery to the Company of a promissory note jointly and severally executed by Parent and Merger Sub having a principal amount equal to the balance of the purchase price, or a combination of the foregoing. The exercise of the Top-Up Option will not be given effect in determining the value of Shares under the dissenters’ rights provisions of the WBCA.

The ~~Merger~~information ~~Agreement~~set ~~contains~~forth ~~representations,~~above warranties and covenants of the parties as customary for transactions of this type. The Company has also agreed to customary covenants governing the conduct of its business, including an obligation to conduct its business in the ~~ordinary~~first ~~course~~paragraph consistent with past practice through the Effective Time. Subject to certain limited exceptions in the Merger Agreement, the Company has agreed not to solicit, initiate or participate in discussions with third parties regarding other proposals to acquire the Company and it has agreed to certain restrictions on its ability to respond to such proposals, subject to fulfillment of certain fiduciary requirements of the Company’s Board of Directors (the “Board”). The Merger Agreement also contains customary termination provisions for the Company and Parent and provides that, in connection with the termination of the Merger Agreement in connection with a competing acquisition proposal under ~~certain specified circumstances, the Company may be required to pay Parent a termination fee of $28~~Item 1.702 ~~million~~is ~~and~~incorporated ~~that,~~by inreference ~~connection~~into ~~with~~this ~~the termination of the Merger Agreement under certain specified circumstances not relating to an acquisition proposal, the Company may be required to pay Parent a termination fee of $57~~Item 5.~~4 million~~01.

The ~~Merger~~aggregate ~~Agreement~~purchase ~~provides~~price ~~that~~paid ~~each Company Option outstanding at the Effective Time, whether vested or unvested, will be cancelled at the Effective Time in exchange for a cash payment to be made~~ by Parent asin ~~soon~~connection aswith ~~practicable following~~ the ~~Effective Time equal to the excess of the~~ Offer ~~Price~~and ~~over~~ the ~~exercise~~Merger ~~price~~is ~~per~~approximately ~~share~~$885 ~~of the Company Option~~million, ~~multiplied~~plus byrelated ~~the~~transaction fees. Parent ~~number~~funded ~~of Shares covered by such Company Option, provided, that if~~ the ~~exercise~~acquisition ~~price~~from ~~per~~available ~~share~~cash. ~~of any Company Option is equal to or greater than the Offer Price, that Company Option~~

As a result of the expiration of the offering period for the Offer on October 7, 2010, and Parent’s acceptance for purchase of all validly tendered and not validly withdrawn Shares on October 8, 2010, a change in control of the Company occurred and the Company became an indirect subsidiary of Parent. As of October 12, 2010, as a result of the Merger, the Surviving Corporation is a wholly-owned subsidiary of Parent.

The information set forth below in the first paragraph under Item 5.02 is incorporated by reference into this Item 5.01.

Item 5.02.

Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On October 8, 2010, in connection with the completion of the Offer and pursuant to the terms of the Merger Agreement, Parent became entitled to designate up to such number of members of the Company’s Board of Directors (the “Board”) as is equal to the proportionate number of Shares owned by Parent and Merger Sub relative to the number of Shares then outstanding. In accordance with the Merger Agreement, effective October 8, 2010, the following directors of the Company resigned: James A. Harper, David I. Hirsh, Ph.D., Lars Fruergaard Jørgensen, Jonathan S. Leff, A. Bruce Montgomery, M.D., and Edward E. Penhoet, Ph.D. On the same date, and after such resignations, the Board filled the vacancies created by such resignations by appointing Paul R. Biondi, David J. Brienza, P. Joseph Campisi, Jr., Jeffrey Galik, Jeremy Levin and Kabir Nath to serve as directors of the Company.

Pursuant to the Merger Agreement, upon the Effective Time, the directors of Merger Sub became the directors of the Surviving Corporation and the officers of Merger Sub became the officers of the Surviving Corporation. As of October 12, 2010, the board of directors of the Surviving Corporation is comprised of: Jeremy Levin, Jeffrey Galik, Kabir Nath and David T. Bonk. As of October 12, 2010, the executive officers of the Surviving Corporation include: Jeremy Levin, President, David T. Bonk, Vice President, P. Joseph Campisi, Jr., Vice President, Sonia Vora, Secretary and Jeffrey Galik, Treasurer.

The other information required by Item 5.02 of Form 8-K is contained in the Company’s Solicitation/Recommendation on Schedule 14D-9 originally filed by the Company with the SEC on September 15, 2010, including the Information Statement comprising Annex I thereto, and such information is incorporated by reference into this Item 5.02.

Item 5.03.

Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

Pursuant to the Merger Agreement, upon the Effective Time, the name of Merger Sub, as the Surviving Corporation, was changed to “ZymoGenetics, Inc.”, and the Articles of Incorporation of the Surviving Corporation were amended and restated in their entirety as set forth in the Merger Agreement. Also, pursuant to the Merger Agreement, upon the Effective Time, the Bylaws of Merger Sub, as in effect immediately prior to the Effective Time, became the Bylaws of the Surviving Corporation except that the name of the corporation set forth therein was

~~will~~changed beto ~~cancelled~~“ZymoGenetics, ~~or expire without any cash payment made in respect thereof~~Inc.” ~~Each~~Copies ~~Company~~of ~~restricted stock unit outstanding at~~ the ~~Effective~~Articles ~~Time,~~of ~~whether~~Incorporation ~~vested or unvested, will be cancelled~~ and ~~the~~Bylaws ~~holder~~ of the ~~Company~~Surviving ~~restricted~~Corporation ~~stock~~are ~~unit~~filed ~~will~~as beExhibit 3.1 ~~entitled~~and toExhibit ~~receive~~3.2, anrespectively, ~~amount in cash equal~~ to ~~the~~this report ~~Offer~~and ~~Price~~are ~~multiplied~~incorporated by ~~the~~reference ~~number~~into ofthis ~~Shares subject to that Company restricted stock unit immediately prior to the Effective Time~~Item 5. 03.

~~The~~Item ~~Merger~~9.01. ~~Agreement~~Financial ~~has~~Statements ~~been adopted by the boards of directors of both Parent~~ and the Company and the Company’s Board has unanimously recommended that shareholders of the Company accept the Offer, tender their Shares to Merger Sub pursuant to the Offer and, if required by the WBCA, vote to approve the Merger Agreement and the related Plan of MergerExhibits.

This summary of the principal terms of the Merger Agreement and the copy of the Merger Agreement filed as an exhibit to this Form 8-K are intended to provide information regarding the terms of the Merger Agreement and are not intended to modify or supplement any factual disclosures about the Company in its public reports filed with the Securities and Exchange Commission. In particular, the Merger Agreement and the related summary are not intended to be, and should not be relied upon as, disclosures regarding any facts and circumstances relating to the Company. The foregoing description of the Offer, Merger and the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which is attached hereto as Exhibit 2.1 and is incorporated into this report by reference.

The Merger Agreement itself has been provided solely to inform investors of its terms. The Merger Agreement contains representations and warranties by the Company, on the one hand, and by Parent and Merger Sub, on the other hand, made solely for the benefit of the other. The assertions embodied in those representations and warranties are qualified by information in confidential disclosure schedules that the parties have exchanged in connection with signing the Merger Agreement. The disclosure schedules contain information that modifies, qualifies and creates exceptions to the representations and warranties set forth in the Merger Agreement. Moreover, certain representations and warranties in the Merger Agreement were made as of a specified date, may be subject to a contractual standard of materiality different from what might be viewed as material to shareholders or may have been used for the purpose of allocating risk between the Company, on the one hand, and Parent and Merger Sub, on the other hand. Accordingly, investors are not third-party beneficiaries under the Merger Agreement and should not rely on the representations and warranties in the Merger Agreement as characterizations of the actual state of facts about the Company, Parent or Merger Sub at the time they were made or otherwise.

Tender and Support Agreements

Concurrently with the execution and delivery of the Merger Agreement, each of Novo Nordisk A/S (“Novo”) and Warburg, Pincus Equity Partners, L.P. (“WPEP”) (including certain affiliates thereof), together representing ownership of approximately 37% of the issued and outstanding Shares, entered into a Tender and Support Agreement with Parent and Merger Sub (collectively, the “Support Agreements”). Pursuant to the Support Agreements, each of Novo and WPEP committed, among other things and subject to the terms and conditions of the Support Agreement, (i) to tender in the Offer (and not withdraw) their respective Shares beneficially

owned or subsequently acquired by them as promptly as practicable following the commencement of the Offer, and in any event no later than the 10 business days following the commencement of the Offer, (ii) if required, to vote their respective Shares beneficially owned or acquired by them in favor of the approval of the Merger and against any competing transaction and (iii) not to transfer any of their respective Shares beneficially owned or acquired by them other than in accordance with the terms and conditions set forth in the Support Agreements. In addition, each of Novo and WPEP has agreed not to solicit, initiate or participate in discussions with third parties regarding other proposals to acquire the Company. The Support Agreements automatically terminate upon termination of the Merger Agreement in accordance with its terms or upon the occurrence of certain other specified events.

The foregoing description of the Support Agreements set forth above does not purport to be complete and is qualified in its entirety by reference to the form of Support Agreement, a copy of which is attached hereto as Exhibit 2.2 and is incorporated into this report by reference.

Retention and Severance Plan

On August 27, 2010, the Board adopted the ZymoGenetics, Inc. Retention and Severance Plan (the “Retention Plan”) in connection with the proposed Merger. The Retention Plan was amended by the Board on September 3, 2010 and on September 7, 2010, and became effective upon the execution of the Merger Agreement. The Retention Plan is designed to provide incentives for employees of the Company to induce such employees to remain employed with the Company pending the completion of the Merger and to provide severance to employees of the Company who would not otherwise receive severance payments upon certain involuntary terminations of employment in connection with the Merger.

Under the Retention Plan, all employees of the Company who are not executive officers (the “Participants”) who remain employed through the Effective Time or who are terminated by the Company without cause (within the meaning of the Retention Plan) prior to the Effective Time will receive payment in an amount equal to their 2010 target bonus or, in the event of Participants who do not have a 2010 target bonus, an amount equal to their actual 2009 annual bonus, in each case, within 10 days following the Effective Time.

The Retention Plan provides for a retention bonus to be paid to all Participants who remain employed through the Effective Time or who are terminated by the Company without cause prior to the Effective Time in an amount equal to one month of their base salary in the event the Effective Time occurs on or before October 21, 2010, two months of their base salary in the event the Effective Time occurs after October 21, 2010 but before December 9, 2010 or, in the event that the Effective Time occurs after December 9, 2010, the sum of (i) two months of their base salary, (ii) 50% of the base salary received by the Participants between the date of the Merger Agreement and the Effective Time and (iii) 1/12 of the Participants’ 2010 target bonus or, in the event of Participants who do not have a 2010 target bonus, 1/12 of their actual 2009 annual bonus. The retention bonus will be paid within ten days following the Effective Time, provided that if such person’s employment terminates without cause prior to the Effective Time, payment will be made within ten days following the earlier of (A) March 1 of the calendar year following the calendar year in which such termination occurred or (B) the Effective Time.

The Retention Plan also provides for severance benefits for all employees of the Company or its subsidiaries not otherwise covered by existing severance agreements who are terminated by the Company without cause or who resign following a reduction in base salary or relocation of more than 60 miles, in each case, on or after the date of the Merger Agreement or within twelve months following the Effective Time. These severance benefits will consist of (i) continued base salary for six weeks plus two additional weeks per year of service to the Company (with a minimum of between three and six months depending on job level), (ii) up to 30 hours of outplacement service based on job level and (iii) the reimbursement or direct payment of healthcare continuation coverage under COBRA for up to the same amount of time as continued base salary is paid. In order to be eligible for severance benefits, the employee must timely execute and not revoke during any applicable revocation period a general release of claims against the Company. None of the Company’s named executive officers are eligible for severance benefits under the Retention Plan since each is entitled to severance under his or her employment agreement with the Company.

The foregoing description of the Retention Plan does not purport to be complete and is qualified in its entirety by reference to the Retention Plan, which is filed as Exhibit 2.3 hereto and is incorporated herein by reference.

Item 5.02. Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers

(e) Material Compensatory Plan, Contract or Arrangement

On September 7, 2010, the Board also approved the payment of a $400,000 transaction bonus to Douglas E. Williams, the Chief Executive Officer of the Company, at and subject to the occurrence of the Effective Time, in recognition of Mr. William’s integral role in the Merger.

Additional Information about the Transaction and Where to Find It

The tender offer has not yet commenced. This filing and the attached exhibits are neither an offer to buy nor a solicitation of an offer to sell any securities of the Company. The solicitation and the offer to buy shares of the Company’s common stock will only be made pursuant to a tender offer statement on Schedule TO, including an offer to purchase, a letter of transmittal and other related materials that Zeus Acquisition Corporation, a wholly-owned subsidiary of Bristol-Myers Squibb Company, intends to file with the Securities and Exchange Commission (the “SEC”). In addition, the Company will file with the SEC a Solicitation/Recommendation Statement on Schedule 14D-9 with respect to the tender offer and, if applicable, a proxy statement regarding the merger. Once filed, investors will be able to obtain the tender statement on Schedule TO, the offer to purchase, the Solicitation/Recommendation Statement of the Company on Schedule 14D-9, the proxy statement, if applicable, and related materials with respect to the tender offer and the merger, free of charge at the website of the SEC at www.sec.gov, from the information agent and dealer manager named in the tender offer materials. Investors may also obtain, at no charge, the documents filed with or furnished to the SEC by the Company under the “Investor” section of the Company’s website at www.zymogenetics.com. Investors are advised to read these documents when they become

available, including the Solicitation/Recommendation Statement of the Company and any amendments thereto, as well as any other documents relating to the tender offer and the merger that are filed with the SEC, carefully and in their entirety prior to making any decisions with respect to whether to tender their shares into the tender offer because they contain important information, including the terms and conditions of the tender offer.

Forward-Looking Statements

Certain statements either contained in or incorporated by reference into this document, other than purely historical information, including estimates, projections and statements relating to the Company’s business plans, objectives and expected operating results, and the assumptions upon which those statements are based, are “forward-looking statements.” These forward-looking statements generally include statements that are predictive in nature and depend upon or refer to future events or conditions, and include words such as “believes,” “plans,” “anticipates,” “projects,” “estimates,” “expects,” “intends,” “strategy,” “future,” “opportunity,” “may,” “will,” “should,” “could,” “potential,” or similar expressions. Such forward-looking statements include the ability of the Company, Merger Sub and Parent to complete the transactions contemplated by the Merger Agreement, including the parties’ ability to satisfy the conditions to the consummation of the tender offer and the other conditions set forth in the Merger Agreement and the possibility of any termination of the Merger Agreement. The forward-looking statements contained in this document are based on current expectations and assumptions that are subject to risks and uncertainties which may cause actual results to differ materially from the forward-looking statements. Actual results may differ materially from current expectations because of risks associated with uncertainties as to the timing of the tender offer and the subsequent merger; uncertainties as to how many of the Company’s shareholders will tender their shares of common stock in the tender offer; the risk that competing offers or acquisition proposals will be made; the possibility that various conditions to the consummation of the offer or the merger may not be satisfied or waived, including that a governmental entity may prohibit, delay or refuse to grant approval for the consummation of the offer or the merger; the effects of disruption from the transactions on the Company’s business and the fact that the announcement and pendency of the transactions may make it more difficult to establish or maintain relationships with employees, suppliers and other business partners; the risk that shareholder litigation in connection with the tender offer or the merger may result in significant costs of defense, indemnification and liability; other uncertainties pertaining to the business of the Company, including the Company’s unproven product sales and marketing; manufacturing and commercialization capabilities; strategic partnering activities; product safety; clinical trials and results; legislative and regulatory activity and oversight; intellectual property claims and litigation; the continuing global economic uncertainty and other risks detailed in the Company’s public filings with the Securities and Exchange Commission from time to time, including the Company’s most recent Annual Report on Form 10-K for the year ended December 31, 2009 and Quarterly Reports on Form 10-Q. The reader is cautioned not to unduly rely on these forward-looking statements. The Company expressly disclaims any intent or obligation to update or revise publicly these forward-looking statements except as required by law.

Item 9.01 Financial Statements and Exhibits

(d)

Exhibits

2.1		Agreement and Plan of Merger, dated as of September 7, 2010, by and among ZymoGenetics, Inc., Bristol-Myers Squibb Company and Zeus Acquisition Corporation.*
3.1		Amended and Restated Articles of Incorporation of ZymoGenetics, Inc., dated as of October 12, 2010.
2.2		Form of Tender and Support Agreement dated as of September 7, 2010.
3.2		Bylaws of ZymoGenetics, Inc., effective as of October 12, 2010.
2.3		ZymoGenetics, Inc. Retention and Severance Plan, adopted on August 27, 2010, as amended on September 3, 2010 and September 7, 2010.
20.1		Information Statement pursuant to Section 14(f) of the Securities Exchange Act of 1934, as amended, and Rule 14f-1 thereunder (incorporated by reference to Exhibit (a)(1)(C) of the Company’s Solicitation/Recommendation Statement on Schedule 14D-9 filed with the Securities and Exchange Commission on September 15, 2010, as amended).

*4 ~~Schedules omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to furnish a supplemental copy of any omitted schedule to the SEC upon request.~~

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Dated as of ~~September~~October 812, 2010

ZYMOGENETICS, INC. By: /s/ ~~James~~Jeremy A.Levin ~~Johnson~~ Name: ~~James A~~Dr. ~~Johnson~~Jeremy Levin Title: ~~Executive Vice~~ President~~, Chief Financial Officer, Treasurer and Secretary~~

EXHIBIT INDEX

Exhibit No.		Description
ExhibitNo.		Description
2.1		Agreement and Plan of Merger, dated as of September 7, 2010, by and among ZymoGenetics, Inc., Bristol-Myers Squibb Company and Zeus Acquisition Corporation.*
3.1		Amended and Restated Articles of Incorporation of ZymoGenetics, Inc., dated as of October 12, 2010.
2.2		Form of Tender and Support Agreement dated as of September 7, 2010.
3.2		Bylaws of ZymoGenetics, Inc., effective as of October 12, 2010.
2.3		ZymoGenetics, Inc. Retention and Severance Plan, adopted on August 27, 2010, as amended on September 3, 2010 and September 7, 2010.
20.1		Information Statement pursuant to Section 14(f) of the Securities Exchange Act of 1934, as amended, and Rule 14f-1 thereunder (incorporated by reference to Exhibit (a)(1)(C) of the Company’s Solicitation/Recommendation Statement on Schedule 14D-9 filed with the Securities and Exchange Commission on September 15, 2010, as amended).

*6 ~~Schedules omitted pursuant to Item 601(b)(2) of Regulation S-K. The Company agrees to furnish a supplemental copy of any omitted schedule to the SEC upon request.~~

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