This 5 arm study will assess the efficacy, pharmacokinetics, safety and tolerability of a DPP-IV inhibitor compared to placebo in patients with type 2 diabetes. Patients will be randomized to receive DPP-IV(3) at one of 4 doses (of 12.5mg and above), or placebo p.o. Patients receiving metformin before the study will continue on the same dose of metformin. The anticipated time on study treatment is 3-12 months, and the target sample size is 100-500 individuals.