ANDES-AGI-1067 as a Novel Antidiabetic Agent Evaluation Study

Inclusion Criteria:

1. Provide informed written consent prior to entry.

2. Be male or female 18-75 years of age at the time of entry and have Type 2 diabetes fora minimum of 6 months prior to Screening 1 visit.

3. Have an HbA1c level measured at the Screening 1 and Screening 2 visits with a minimumlevel at ≥7.5% for both visits, as determined by the core lab analysis.

4. Be taking either 1 or no antidiabetic agents. If on an antidiabetic medication, itmust be of the sulphonylurea, metformin, or glitazone class, and the dosage must havebeen stable for the last 3 months prior to the Screening 1 visit. Note that nocombination medications (i.e., counted as more than 1 agent) will be permitted priorto Randomization and that the use of GLP mimetrics, DPPIV inhibitors, or colesevelamare not permitted (rescue medication will be allowed at 3 months).

5. Subjects who are using hormone replacement therapy must have been on stable doses oftheir hormone replacement therapy for at least 3 months prior to the Screening 1visit.

6. Females must not be breast feeding or pregnant. If they are of child-bearingpotential, they must be using a reliable method of birth control considered suitableby the Investigator. If on hormonal contraceptives for more than 6 months, subjectswill be allowed to participate in the study provided that this therapy remainsconstant throughout the study and for a period of 2 months after the end of the study.

Exclusion Criteria:

1. Have Type 1 diabetes or history of ketoacidosis determined by medical history

2. Have an HbA1c of more than 10.5% or a fasting glucose of >240 mg/dL (13.3 mmol/L) ateither the Screening 1 [Visit 1] or Screening 2 [Visit 2])

3. Have a history of severe diabetic neuropathy including autonomic neuropathy,gastroparesis, or lower limb ulceration or amputation.

4. Have a history of long-term therapy with insulin (>30 days) within the last year or >7days within the last 3 months.

5. Require parenteral corticosteroids or recurrent continuous oral corticosteroidtreatment (>2 weeks) within the last 3 months.

6. Use weight loss drugs (e.g., orlistat, sibutramine, phenylpropanolamine, phentermine,or similar prescription or over-the-counter medications) within 3 months of theScreening 1 visit or intentional weight loss of ≥4 kg in the previous 6 months.

7. Have had a new antidiabetic medication added, or the dose of an existing antidiabeticmedication changed, in the last 3 months prior to the Screening 1 visit.

8. Have had a stroke, MI, coronary artery bypass graft (CABG), percutaneous transluminalcoronary angioplasty (PTCA), or admission with unstable angina within the last 6months prior to the Screening 1 visit.

9. Have congestive heart failure New York Heart Association Class III or IV (Appendix B).

10. Have taken any of the following drugs in 6 months prior to the Screening 1 visit:cholestyramine, colestid, cyclosporine, or isotretinoin.

11. Have acute infections requiring parenteral antibiotic treatment within the last 3months.

12. Have uncontrolled hypertension (defined as systolic blood pressure >180 mmHg).

13. Have platelets <100,000 K/cu mm (x 103/μL) at the Screening 1 visit.

14. Have active liver disease or hepatic dysfunction (total bilirubin, aspartateaminotransferase [AST], alanine aminotransferase [ALT] >1.5 times upper limit ofnormal [ULN]) as determined by core lab analysis at either the Screening 1 visit orthe Screening 2 visits.

15. Subjects with long QT syndrome as evidence by a QTc at the Screening 1 visit of >460msec in males or >480 msec in females or subjects taking and requiring continuedtherapy with antiarrhythmic medications such as sotalol, quinidine, dofetilide,amiodarone or other drugs known to significantly prolong the QT interval (this willnot include drugs associated with minor effect on the QT interval of less than 15msec.)

16. Have known major chronic infection or major hematologic, renal, metabolic,gastrointestinal or endocrine dysfunction in the judgment of the Investigator (including diabetes mellitus too severe to allow the subject to safely participate inthis study).

17. Have had a life-threatening illness or any history of cancer or malignancy within thepast 5 years (except for basal cell carcinoma).

18. Have had surgery requiring inpatient admission within 30 days prior to the Screening 1visit.

19. Considered unreliable as a study participant based on the Investigator's (ordesignee's) knowledge of the subject (e.g., history of alcohol or other drug abuse,inability or unwillingness to adhere to the protocol, or psychosis).

20. Have a history of intolerance or previous use of probucol within the last 5 years.

21. Have participated in a previous study with AGI-1067.

22. Have participated in any investigational drug study within 30 days prior to studyentry, or expects to participate in any other investigational drug study during thecourse of ANDES.