On October 27, 2009, the board of directors of ARYx Therapeutics, Inc. ("ARYx") committed to a restructuring plan that will result in a reduction in force affecting 17 employees, none of whom are executives of ARYx. The restructuring plan is primarily designed to align ARYx's organizational structure to improve operational efficiencies in light of ARYx's plan to focus development efforts on earlier stage product candidates to the extent ARYx's lead development programs are out-licensed in connection with anticipated collaboration arrangements with third-party pharmaceutical companies.

Employees directly affected by the reduction in force have received notification and will be provided with severance payments, continuation of benefits and outplacement assistance for a limited term. The positions impacted are across ARYx's business functions, including the research and development, clinical, operations and general and administrative departments. ARYx expects to complete the restructuring plan during November 2009.

As a result of the restructuring plan, ARYx estimates that it will record an aggregate restructuring charge of approximately $0.5 million in the fourth quarter of 2009 for severance and other personnel-related expenses, such as employee benefits. The restructuring charge that ARYx expects to incur in connection with the restructuring plan is subject to a number of assumptions, and actual results may materially differ. ARYx may also incur other material charges not currently contemplated due to events that may occur as a result of, or associated with, the restructuring plan.

This current report on Form 8-K contains forward-looking statements, including, but not limited to, statements related to the completion of collaboration arrangements for ARYx's lead product candidates, the expected timing of completion of the reduction in force, and the expected costs and related charges of the reduction in force. Words such as "designed," "anticipated," "expects," "will," "estimates," and "may," and similar expressions are intended to identify forward-looking statements. These forward-looking statements are based upon ARYx's current plans, assumptions, beliefs, and expectations. Forward-looking statements involve risks and uncertainties. ARYx's actual results and the timing of events could differ materially from those anticipated in such forward-looking statements as a result of these risks and uncertainties, which include, without limitation, the risk that ARYx may not be able to establish collaboration arrangements for its lead product candidates on favorable terms or at all; the risk that the restructuring costs may be greater than anticipated; the risk that ARYx's workforce reduction and any future workforce and expense reductions may have an adverse impact on ARYx's internal programs, its ability to hire and retain key personnel and may be distracting to management; and risks related to ARYx's need for additional funding and other risks detailed from time to time in ARYx's filings with the Securities and Exchange Commission, including its Quarterly Report on Form 10-Q for the quarter ended June 30, 2009 and other periodic filings with the Securities and Exchange Commission. ARYx expressly disclaims any duty, obligation, or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in ARYx's expectations with regard thereto or any change in events, conditions, or circumstances on which any such statements are based.

On October 29, 2009, ARYx issued a press release announcing the restructuring plan and associated reduction in force described in Item 2.05 of this Current Report on Form 8-K and providing an update on ARYx's partnering/collaboration efforts for its lead product candidates. A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated by reference herein.

(d) Exhibits

Exhibit Number                               Description
     99.1        Press release, dated October 29, 2009, entitled "ARYx Therapeutics
                 Aligns Operations to Development Activities - Company Also Provides
                 Update on Product Partnering Efforts."