Even as we work to advance our development stage pipeline, we continue to focus on discovering important new potential therapies for the treatment of metabolic disease. We are continuing our internal discovery efforts and in the future may seek to license projects or products that complement our strategic focus. Once we identify a new drug candidate and recommend it for clinical development, the compound undergoes pre-clinical development including scale-up, toxicology and formulation development. Successful compounds then enter human clinical testing.

At any given time we generally have a number of exploratory and fully staffed discovery projects underway. Some of the projects that we believe have the potential to yield clinical development candidates within the next few years are yet to be disclosed.

Research programs we have disclosed include:

• AMPK Project: Initiated in 2005, this project, which is being conducted in collaboration with Merck, focuses on the discovery of a novel treatment for metabolic diseases such as type 2 diabetes, hyperlipidemia, and possibly obesity and fatty liver disease through activation of AMP-activated protein kinase. We have identified a potent AMPK activator that shows activity in cells and animal models demonstrating activation of AMPK. Efforts are underway to characterize this and other project compounds. The research term of this collaboration was recently extended by one year, through June 2009.
  
  
• Glucagon Antagonist Project: This advanced research program is focused on identifying chemically novel, potent, orally bioavailable glucagon antagonists for treating type 2 diabetes. Our most advanced compound has shown significant and consistent lowering of blood glucose when dosed orally to diabetic db/db mice and three other animal models of diabetes or insulin resistance.
  
  
• TR beta Agonist Project: The goal of this advanced research program is to identify second-generation TR beta agonists for managing hyperlipidemia. This program may yield additional development candidates that lower cholesterol and triglycerides by the same mechanism as MB07811 but with potential improvements.