Dose-Ranging Study in Treatment Naive Type 2 Diabetes Mellitus(T2DM)

Females of non-childbearing and childbearing potential are eligible to participate as follows: •Women of childbearing potential must be willing to use one of the following contraception methods: intrauterine device, condom or occlusive cap (diaphragm or cervical/vault caps) plus spermicidal agent for at least 30 days prior to the start of study medication, throughout the study and the follow-up visit. Note: use of oral contraceptives is not permitted. •Women of non-child bearing potential are defined as follows: females regardless of age, with functioning ovaries and who have a current documented tubal ligation [Hatcher, 2004] bilateral oophorectomy or total hysterectomy, or females who are post-menopausal). (Post-menopausal is defined as after one year without menses with an appropriate clinical profile, e.g. age appropriate, >45 years, in the absence of hormone replacement therapy. In addition to the above criteria, if the post-menopausal status is still questionable, a blood sample should be drawn for simultaneous measurement of follicle stimulating hormone and estradiol; values considered to confirm the post-menopausal state are respectively: FSH >40 MIU/mL and estradiol <40pg/mL (<140 pmol/L)).

Metabolic Disease •Diagnosis of Type 1 diabetes mellitus. •History of ketoacidosis which has required hospitalization. •Thyroid disorder [TSH below the lower limit of the reference range (LLRR) of 0.4mIU/L or above the upper limit of the reference range (ULRR) of >5.5 mIU/L at Screening]. Hypothyroidism treated with the same dose and regimen of thyroid hormone replacement for at least 3 months prior to Screening is allowed. •BMI of <22 or >43 kg/m2. •Significant weight gain or loss (as defined as >5% of total body weight) in the 3 months prior to Screening.

Diabetic Medication •Has taken insulin or any oral or injectable anti-diabetic medication ≥4 weeks at any time prior to screening. •Has taken insulin or any oral or injectable anti-diabetic medication within 3 months of screening.

Cardiovascular Disease •Recent history or presence of clinically significant acute cardiovascular disease including: a.Documented myocardial infarction in the 6 months prior to Screening. b.Coronary revascularization including percutaneous transluminal coronary angioplasty (PTCA) or coronary artery bypass graft (CABG) surgery either planned and/or occurred in the 6 months prior to Screening. c.Unstable angina in the 6 months prior to Screening. d.Clinically significant supraventricular arrhythmias requiring medical therapy, or history of nonsustained or sustained ventricular tachycardia. Symptomatic valvular heart disease or valvular heart disease requiring therapy other than endocarditis prophylaxis. e.Congestive heart failure (CHF, New York Heart Association (NYHA) Class II to IV) requiring pharmacologic treatment. NYHA Class I may be included in accordance with the local prescribing information for pioglitazone. f.Blood pressure (BP) >150/100mmHg. If a subject is receiving permitted antihypertensive therapy, then they must be on stable dose(s) of therapy for at least 4 weeks prior to Screening. g.Has a QTc interval (Bazett's) ≥450msec at Screening on a single ECG or an average value from 3 ECGs taken 5 minutes apart (on local reading of ECG). h.Other clinically significant ECG abnormalities which, in the opinion of the investigator, may affect the interpretation of efficacy and safety data, or which otherwise contraindicates participation in a clinical trial with a new chemical entity. •Fasting triglycerides ≥400mg/dL (4.56mmol/L) at Screening. If a subject is receiving permitted lipid-lowering therapy, then they must be on a stable dose(s) of therapy for at least 6 weeks prior to Screening. Niacin and bile acid sequestrants are prohibited.

Hepatic Disease Has a diagnosis of active hepatitis (hepatitis B surface antigen or hepatitis C antibody), or clinically significant hepatic enzyme elevation including: Any one of the following enzymes greater than 2 times the upper limit of the reference range (ULRR) value at Screening. •alanine transaminase (ALT). •aspartate transaminase (AST). •alkaline phosphatase (AP). Has a total bilirubin level that is >1.5 times the ULRR at Screening with the exception of suspected or confirmed Gilbert's disease.

Pancreatic Disease •Secondary causes of diabetes: •history of chronic or acute pancreatitis

Renal Disease •Significant renal disease at Screening as manifested by: Glomerular filtration rate (GFR) <60mL/min (as estimated from serum creatinine at Visit 1 and demographic data using the MDRD equation).For the MDRD equation, please refer to the study procedures manual. Proteinuria of ≥1+ by urinary dipstick •Recurrent genitourinary tract infections defined as ≥2 episodes of complicated or uncomplicated cystitis or pyelonephritis in the 6 months prior to Screening •A positive qualitative urinary dipstick for leukocytes, red blood cells (RBC) or nitrites at Screening.

Concurrent Disease •Has any concurrent condition or any clinically significant abnormality identified on the screening physical examination, laboratory tests (including blood electrolytes), electrocardiogram, including pulmonary, neurological or inflammatory diseases, which, in the opinion of the investigator, may affect the interpretation of efficacy and safety data, or which otherwise contraindicates participation in a clinical trial with a new chemical entity •History of significant co-morbid diseases active in the 6 months prior to Screening (e.g., cholecystitis, acute pancreatitis, gastrointestinal disease, chronic diarrhea, etc.) •Has a history of malignancy within the past five years [other than superficial squamous cell carcinoma which is non-invasive on pathology or basal cell carcinoma which is successfully treated with local excision] and cervical cancer in situ treated definitively at least 6 months prior to Screening

Concurrent Medication •Is currently taking or has taken any of the following medications in the 8 weeks prior to Screening: a.Digoxin b.Warfarin and other oral anticoagulants (aspirin and non-steroidal anti-inflammatory drugs are permitted) c.Bile acid sequestrants d.Niacin (excluding routine vitamin supplementation) e.Antiobesity agents (including fat absorption blocking agents) f.Oral or injectable corticosteroids (inhaled and intranasal corticosteroids are permitted) g.Loop diuretics h.Monoamine oxidase inhibitors and tricyclic amines i.Antiretroviral drugs j.St John's Wort k.Oral chromium

Pregnancy & Breast Feeding •Is currently lactating or pregnant

Other •Current smoker who is unable to abstain from smoking while in the clinic at each visit •Has a history of alcohol or substance abuse within the past year at Screening or alcohol or substance abuse during treatment, as determined by the investigator: •Unwilling to refrain from the use of illicit drugs and adhere to other protocol-stated restrictions while participating in the study. •Has an average weekly intake of greater than 21 units or an average daily intake of greater than 3 units (males) or an average weekly intake of greater than 14 units or an average daily intake of greater than 2 units (females). One unit is equivalent to a half-pint of beer or 1 measure of spirits or 1 glass of wine •Has participated in any study with an investigational or marketed drug in the 3 months prior to Screening •In the opinion of the investigator has a risk of non-compliance with study procedures, or cannot read, understand, or complete study related materials, particularly the informed consent •Known allergy to any of the tablet excipients, or history of drug or other allergy, which, in the opinion of the responsible study physician