Summary of VANDA PHARMACEUTICALS INC.

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

On December 19, 2012, the Compensation Committee of the Board of Directors (the "Compensation Committee") of Vanda Pharmaceuticals Inc. (the "Company") awarded 2012 annual bonuses to and approved 2013 annual base salaries and 2013 bonus target amounts for the Company's named executive officers. Prior to approving the foregoing, the Compensation Committee reviewed an analysis of the Company's executive compensation compared to the Company's peer group conducted by Towers Watson, a compensation consultant engaged by the Compensation Committee.

The Compensation Committee awarded bonuses for performance for the twelve-month period ending December 31, 2012, in the amounts set forth opposite the names of the executive officers listed below.

Name                                            Position                       2012 Bonus
Mihael Polymeropoulos, M.D.     President and Chief Executive Officer         $    300,000
James Kelly                     Senior Vice President, Chief Financial
                                Officer                                       $    144,000
Robert Repella                  Senior Vice President and Chief
                                Commercial Officer                            $    168,000

The Compensation Committee approved 2013 annual base salaries and 2013 bonus target amounts for the twelve-month period ending December 31, 2013, in the amounts set forth opposite the names of the executive officers listed below.

Name                                  Position           2013 Base Salary           2013 Target Bonus
Mihael Polymeropoulos, M.D.     President and Chief
                                Executive Officer        $         515,000       50% of 2013 Base Salary
James Kelly                     Senior Vice
                                President, Chief
                                Financial Officer        $         315,000       40% of 2013 Base Salary
Robert Repella                  Senior Vice
                                President and Chief
                                Commercial Officer       $         368,000       40% of 2013 Base Salary