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Subjects (n = 188) with type 2 diabetes and inadequate response to two oral medications (A1C >8.0%) were randomly assigned to treatment with either a third oral medication or an insulin 70/30 mix b.i.d. plus metformin for a comparison of efficacy, safety, and cost.The protocol called for aggressive dose titration to achieve target values of fasting blood glucose (80-120 mg/dl), postprandial glucose (<160 mg/dl), and A1C (<7%). These efficacy parameters were evaluated at weeks 2, 6, 12, and 24 of therapy. If dose adjustments failed to achieve targeted glycemic control, subjects were switched to an alternate therapy.At the end of study (week 24 of therapy), A1C and fasting plasma glucose (FPG) values showed comparable decreases in the two treatment groups. Only 31% (oral therapy) and 32% (insulin plus metformin) of subjects achieved target values of A1C (<7%). A total of 10 of the 98 subjects randomized to triple oral therapy (10.2%) who failed to improve sufficiently were switched to insulin therapy. An additional four subjects dropped out of the oral treatment group due to adverse events felt to be potentially drug related. Only two of the subjects randomized to insulin plus metformin had to be switched to basal-bolus regimens (regular insulin and NPH insulin). Cost analysis determined that insulin plus metformin (mean cost $3.20/day) provided efficacy equal to that of a triple oral drug regimen ($10.40/day).Insulin 70/30 mix plus metformin was as effective as triple oral therapy in lowering A1C and FPG values. The triple oral regimen was not as cost effective, and a high percentage of subjects (total of 16.3%) did not complete this regimen due to lack of efficacy or side effects.