FIRST AMENDMENT

Exhibit 10.16

FIRST AMENDMENT

TO PLAIN ENGLISH GROWTH CAPITAL LOAN AND SECURITY AGREEMENT

This is a FIRST AMENDMENT TO PLAIN ENGLISH GROWTH CAPITAL LOAN AND AGREEMENT dated as of August 15, 2007 (the “Amendment”) by and between BAYHILL THERAPEUTICS, INC., (“Borrower”) and TRIPLEPOINT CAPITAL LLC, a Delaware limited liability company, (“Lender”).

RECITALS

A. Borrower and Lender are parties to the Plain English Growth Capital Loan and Security Agreement dated as of March 7, 2007 (the “Loan Agreement”), pursuant to which Lender agreed to provide financial accommodations to or for the benefit of Borrower upon the terms and conditions contained in the Loan Agreement. Unless otherwise defined in this Amendment, capitalized terms and matters of construction defined in the Loan Agreement shall have the same meaning given to them in the Loan Agreement.

B. Borrower has requested that certain provisions of the Loan Agreement be amended, and Lender is willing to amend the Loan Agreement on the terms and conditions set forth in this Amendment.

AGREEMENT

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are acknowledged, Borrower and Lender agree as follows:

Except as expressly modified by this Amendment, (a) Borrower hereby acknowledges, confirms and ratifies all of the terms and conditions set forth in, and all of its obligations under, the Loan Agreement and the other Loan Documents, and (b) all of the terms and conditions set forth in the Loan Agreement and the other Loan Documents are incorporated in this Amendment by this reference as if set forth in full in this Amendment.

Section 8 of the Loan Agreement is deleted in its entirety and substituted with the following:

You give Us a first priority, continuing security interest in and Lien upon all of Your right, title and interest in each of the following, whether now owned or hereinafter acquired and wherever located:

All the above listed items will be collectively called the “Collateral”.

Notwithstanding the above, Collateral excludes Intellectual Property currently held or hereafter obtained, but includes proceeds of Intellectual Property (including but not limited to all rights to payment or General Intangibles arising from the proceeds); provided, however, other than non-exclusive Licenses, co-exclusive Licenses or exclusive Licenses granted with respect to specified geographic areas, fields of use and forms of proprietary products to either independent contractors for performing work on behalf of You, or specific customers, licensees or corporate partners, in each case that would not result in a transfer of title of the licensed property under applicable law and that are given in the ordinary course of Your business (all of the foregoing, together, the “Product Licenses”), in the event You transfer, sell, assign, grant a security interest in, hypothecate, permit or suffer to exist any Lien, or otherwise transfer any interest in or encumber any portion of the Intellectual Property, either voluntarily or involuntarily, without Our prior written consent, except in the case of Product Licenses, Our security interest shall include (and shall be deemed to have included from the date of this Agreement) all Intellectual Property.

You may enter into accounts receivable financing upon receipt and review by Us of said accounts receivable financing loan documentation and execution of an intercreditor agreement between Us and the accounts receivable financing provider, with terms reasonably acceptable to Us. Such financing may be secured solely by the underlying receivables and proceeds thereof.

Borrower represents and warrants that the representations and warranties contained in the Loan Agreement were true and correct in all material respects when made and, except to the extent that (a) a particular representation or warranty by its terms expressly applies only to an earlier date or (b) Borrower has previously advised Lender in writing as contemplated under the Loan Agreement, are true and correct in all material respects as of the date of this Amendment. Borrower further represents and warrants that there are no Defaults or Events of Default that have occurred and are continuing as of the date of this Amendment.

(Signature Page to Follow)

IN WITNESS WHEREOF, The Parties have executed and delivered this Amendment as of the day and year first above written.

[SIGNATURE PAGE TO FIRST AMENDMENT TO PLAIN ENGLISH GROWTH CAPITAL

LOAN and SECURITY AGREEMENT]