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09222005 CORRESP

September 22, 2005

Mr. Jim B. Rosenberg

Senior Assistant Chief Accountant

United States Securities and Exchange Commission

450 Fifth Street, N.W.

Washington, D.C. 20549

RE:

Pharmacyclics, Inc.

Form 10-K for  the fiscal year  ended June 30, 2004

Filed August 30, 2004

File No. 000-26658

Dear Mr. Rosenberg,

On June 7, 2005, we filed an initial response to the comments
outlined in your letter to us dated May 31, 2005. In a telephone conversation
with Mr. Frank Wyman of the SEC on June 29, 2005, we obtained certain
clarifications associated with your May 31, 2005 letter. We then requested that
you replace our June 7, 2005 response with a response dated July 13, 2005. After
conversations with Mr. Wyman related to our July 13, 2005 response, we are
filing this response.  Accordingly, we request that you replace our July 13,
2005 response with this response which amends and restates our July 13, 2005
response in its entirety.

We note that you do not disclose the principal terms
of your two R&D collaborations, including the duration of these
collaborations, how funding is shared, basis for expense reimbursement, R&D
expense incurred for each period presented, requirements to pay development
milestones and product royalties, expected completion dates and future capital
funding requirements. Also, you do not disclose estimated milestone and royalty
payments in your table of contractual obligations or in a note to the table
explaining their exclusion. Please provide the analysis that served as the basis
for your decision not to include this disclosure in your filing.

The two research and development ("R&D")
collaborations the Staff refers to in comment 1) above are those we have with
the National Cancer Institute ("NCI") and The University of Texas
("UT") as outlined in Part I, Item I of our 10-K for the year ended
June 30, 2004 ("Form 10-K").

As disclosed, our obligations under the NCI collaboration
consist of participating in the selection of clinical trials to be performed by
a third party working under NCI sponsorship and providing clinical supplies of
our drug to support these trials. This agreement does not provide for any past
or future capital funding, milestone, royalty or similar payments, and we
consider the value of the drug that we supply under this agreement to be of an
immaterial dollar amount. Based these facts, we concluded that no additional
disclosures were necessary in our Form 10-K.

Currently, we have two types of agreements, with The
University of Texas.  One type of agreement is a sponsored research and
development agreement where we elect to fund research in defined areas over a
period of time through a group headed by Jonathon Sessler, Ph.D., Professor of
Chemistry at The University of Texas at Austin.  This agreement expires in
December 2005.  Payments under this agreement are not material (less than 1% of
our total R&D expenses for each of the past three fiscal years), and we do
not have an obligation to extend or renew this agreement.

A second type of agreement with The University of Texas are
two license agreements covering our texaphyrin molecules and other molecules
under development that may be developed through our sponsored research and
development agreement discussed above.  As discussed in Note 2 to our financial
statements, we have made annual payments of $50,000 in each of the three years
ended June 30, 2004.  We do not have any future material obligations under the
license agreements prior to receipt of FDA approval for a product incorporating
technology covered by our two license agreements with The University of
Texas.

Based on our discussions with Mr. Wyman, we are revising our
R&D collaboration disclosure in our Annual Report on Form 10-K for the fiscal year ended
June 30, 2005 as follows:

Collaboration and License Agreement

National Cancer Institute Collaboration. In April 1997, the Decision
Network Committee of the National Cancer Institute's Division of Cancer
Treatment, Diagnosis and Centers voted unanimously to sponsor and fund clinical
development of Xcytrin for the treatment of cancer. Under this cooperative
research and development agreement, Pharmacyclics and the National Cancer
Institute jointly select clinical trials which will be conducted at leading
medical centers for various types of cancer. The National Cancer Institute is
conducting several separate clinical trials for treatment of brain tumors and
cancers involving the lung. We believe that these National Cancer Institute-
sponsored trials will supplement our own clinical development efforts for
Xcytrin. Although third parties will be conducting the trials, we will provide
clinical supplies of our drugs and we intend to monitor the progress and results
of these trials.

The University of Texas License.  In 1991, we entered into a license
agreement with the University of Texas under which we received the exclusive
worldwide rights to develop and commercialize porphyrins, expanded porphyrins
and other porphyrin-like substances covered by their patents.  In consideration
for the license, we have paid a total of $300,000. We are obligated to pay
royalties based on net sales of products that utilize the licensed technology.
The term of the license agreement ends upon the last to expire of the patents
covered by the license.  We have royalty obligations under the license as long
as valid and unexpired patents covering the licensed technology exist.
Currently, the dates the last United States and European patents covered by the
agreement expire are 2015 and 2014,
respectively.  Under this agreement, we must be attempting to commercialize one
or more products covered by the licensed technology.  In the event we fail to
attempt to commercialize one or more products covered by the licensed
technology, the University of Texas may convert the exclusive license into a
non-exclusive license.

Disclosure about critical accounting policies should
allow a fuller understanding of how you determined estimates made in connection
with R&D collaborations, critical factors and assumptions underlying these
estimates and the potential impact on your future operations and financial
condition of changes in prior period estimates. We were unable to find this
disclosure in your filing. Please provide the analysis that served as the basis
for your decision not to include this disclosure in your filing.

As stated in our response to comment 1) above, expenses
related to our R&D collaborations have been immaterial in each of our 2002,
2003 and 2004 fiscal years. Therefore, we concluded that discussion of any such
collaborations as critical accounting policies in our Form 10-K was unnecessary
and not helpful to an investor's understanding of our financial performance.

Demonstrate how the disclosed fair value of purchase
awards under the Company's Purchase Plan of $5.72 in 2004, $15.06 in 2003 and
$15.74 in 2002 complies with FAS 123. We note that the Company's stock price was
in the range of $2.35 per share to $5.70 per share for 2003.

Our Purchase Plan includes offering periods with a 24 month
"look-back" provision and a provision to allow employees to withdraw
from the plan prior to any purchase date. According to SFAS 123, paragraph 24,
these provisions automatically result in the Purchase Plan being a
"compensatory" plan and therefore require "fair value"
accounting.

SFAS 123 paragraph 17 notes "The objective of the
measurement process is to estimate the fair value, based on the stock price at
the grant date, of stock options or other equity instruments.."   Appendix
E to SFAS 123 defines grant date as "The date at which an employer and an
employee have a mutual understanding of the terms of a stock based compensation
award. The employer becomes contingently obligated on the grant date to issue
equity instruments or transfer assets to employees who fulfill vesting
requirements."  These criteria are met at the beginning of each offering
period (subscription date), and are therefore considered the "grant
date" for each offering period.  These offering periods begin on November 1
every 24 months, the last being November 1, 2003.

Illustration 9 to SFAS 123 (Paragraphs 348-356) notes that
the fair value of Purchase Plans with a "look-back" feature, a 15%
discount and where the number of shares to be purchased is fixed, is comprised
of two components, 1) the value of the 15% discount and 2) the value of the
"call" option to purchase shares in the future at 85% of the current
price. In addition, our Purchase Plan does not fix the number of shares to be
issued to each employee on the subscription date. Therefore, we compute the fair
value of the "put" option based on the company's obligation to sell
additional shares to the employee on a future date.

Using the format in Illustration 9, the FAS 123 computed fair
value of shares for the offering period beginning 11-1-2001 is calculated as
follows:

Assumptions:

	Market price:

$  22.55

	Interest rate:

2.49%

	Volatility:

98.3%

	Estimated life:

24 months

	Dividend rate:

0%

Valuation:

	15% discount  (15% of $22.55)

$    3.383

	Call option*  (85% of $11.83)

10.058

	Put option*  (15% of $10.75)

      1.615

	FAS 123 computed fair value

    15.055

*Using the Black-Scholes option-pricing model with the
assumptions listed above.

The FAS 123 computed fair value per share for the offering
periods affecting fiscal 2002, 2003, and 2004 (and fair market price of the
stock at the beginning of each offering periods for reference) is outlined as
follows:

FAS 123 Computed Fair Value

Fair
 Market Price of

the Stock

Offering Period Beginning 11-1-1999

$	21.094

$		35.125

Offering Period Beginning 11-1-2001

$	15.055

$		22.550

Offering Period Beginning 11-1-2003

$	3.316

$		5.800

As our fiscal years may overlap two offering periods, the
fair value disclosed in the financial statements may be the weighted average two
offering periods.

In fiscal 2002, the computed fair value of $15.74 is a
weighted average for the Offering Periods beginning 11-1-1999 ($21.094) and 11-
1-2001 ($15.055);

in fiscal 2003, the computed fair value of $15.055 is
comprised solely of the Offering Period beginning 11-1-2001 ($15.055); and

in fiscal 2004 the computed fair value of $5.72 is a
weighted average for the Offering Periods beginning 11-1-2001 ($15.055) and 11-
1-2003 ($3.316).

For example, you noted the Company's stock price in fiscal
2003 ranged from $2.35 to $5.70; however as set forth above, the computed fair
value of the fiscal 2003 purchases was based on the fair market price of the
Company's stock as of 11-1-2001, which was $22.55.

Based on this methodology, we believe our
disclosures properly state the fair value of purchase awards made under the
Company's employee stock purchase plan during fiscal 2002, 2003 and 2004 as
outlined by SFAS 123's grant date valuation approach.

Furthermore, the Company acknowledges the following:

The Company is responsible for the adequacy and accuracy
of the disclosure in the filings;

Staff comments or changes to disclosure in response to
staff comments in the filings reviewed by the staff do not foreclose the
Commission from taking any action with respect to the filing; and

The Company may not assert staff comments as a defense in
any proceeding initiated by the Commission or any person under the federal
securities laws of the United States.

Please be advised that we will also file this letter to you
via the EDGAR filing system. Please contact myself at 408-774-3322 or our Chief
Financial Officer, Leiv Lea, at 408-774-3356, with any additional questions
and/or comments related to this letter.

Sincerely,

Richard A. Miller

President and Chief Executive Officer

Pharmacyclics, Inc.