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[3-[(2R)-[[(2R)-(3-Chlorophenyl)-2-hydroxyethyl]amino]proryl]-1H-indol-7-yloxy]acetic acid (AJ-9677), which was being developed as an antidiabetic, was observed to degrade in tablet preparations. The main degradation product in tablets, AD-9889, was a carbon adduct of the drug substance. When the drug substance was exposed to formaldehyde in aqueous solutions, a correlation was found between the level of formaldehyde and the quantity of AD-9889 formed during storage. Comprehensive one- and two-dimensional NMR analysis of the reaction product identified the location of the carbon atom which originated from formaldehyde, thus proving that AD-9889 was produced by a reaction with formaldehyde. Since it was demonstrated in our previous report that meglumine is an amine that can react with, and reduce amounts of formaldehyde, its stabilizing effect on AJ-9677 was examined. The results showed that in a solution system containing AJ-9677, formaldehyde and meglumine, meglumine reduced formaldehyde levels and suppressed degradation. Addition of meglumine into the tablet formulation of AJ-9677 was also effective in suppressing degradation and successfully stabilized the drug substance. This effect was almost certainly due to meglumine absorbing formaldehyde from around the drug substance and we believe that meglumine can be used with many other drug substances degraded by formaldehyde.