 Approximately 240 patients will be randomized in this study, 60 to each of two MBX-102 treatment groups 400 and 600 mg daily, 60 to placebo, and 60 to the Actos group. Patients in the Actos group will receive Actos 30 mgdaily for the first eight weeks of the treatment phase and Actos 45 mgdaily for the last 16 weeks of the treatment phase. Patients in the MBX-102 400 mg group and MBX-102 600 mg group will continue MBX-102 400 mg and 600 mg, respectively for the full 24 weeks. All study medication will be over-encapsulated; thus, each patient will take two blinded capsules each day containing either placebo, MBX-102 or Actos. This sample size provides the minimum number expected to ensure a power of at least 90 in detecting a difference of 0.64 in HbA1c between the placebo and experimental treatment, using a two-tailed, two-sample t-test with type 1 error of 0.05, when the pooled standard deviation is 1.0, and the discontinuation rate is 12.5. 