Osteoarthritis (OA) is the most common form of arthritis. It can cause pain, swelling, and reduced motion in the joints. That can reduce quality of life.

OA can occur in any joint, but usually affects the hands, knees, hips or spine.

The purpose of this study is to find out if doctors might be able to use 2% PENNSAID gel to treat OA in the knee.

Inclusion Criteria:

1. Primary osteoarthritis of the knee
2. Radiologic evidence of OA of the knee
3. On stable pain therapy with an oral or topical NSAID or acetaminophen
4. Experience a "moderate flare" of pain following washout of stable pain therapy
5. Able to read and understand English or Spanish to answer pain assessment questions without any explanation
6. If female, surgically sterile or non-pregnant
7. Except for OA, in reasonably good general health
8. Written informed consent

Exclusion Criteria:

1. Secondary OA of the study knee
2. History of pseudo gout or inflammatory flare-ups
3. Participation would conflict with contraindications, warnings or precautions as stated in the prescribing information for oral or topical diclofenac
4. Severe, uncontrolled cardiac, renal, hepatic, or other systemic disease
5. Any malignancy within the previous 3 years, except local therapy for superficial skin cancer not on the study knee
6. Known sensitivity to the use of oral or topical diclofenac, aspirin [acetylsalicylic acid (ASA)] or any other NSAID, dimethyl sulfoxide (DMSO), or ethanol
7. Ongoing abnormality that could confound interpretation of the safety results (eg, anemia, unresponsive gastrointestinal [GI] reflux, etc.)
8. Documented gastroduodenal ulcer or any GI bleeding (except hemorrhoidal) within the last 6 months
9. Uncontrolled diabetes
10. Screening laboratory test results of serum creatinine ≥ 1.5 times upper limit of normal; aspartate aminotransferase (AST), alanine aminotransferase (ALT), or gamma-glutamyltransferase (GGT) ≥ 3 times upper limit of normal; and hemoglobin less than or equal to lower limit of normal
11. Documented alcohol or drug abuse within 1 year
12. If female, breast-feeding
13. Major surgery or previous damage to the study knee at any time, or minor knee surgery to the study knee within 1 year
14. Requires oral or intra-muscular corticosteroids, or received an intra articular corticosteroid injection into the study knee within the past 90 days, or into any other joint within the past 30 days, or currently applying topical corticosteroids onto the study knee
15. Received intra-articular viscosupplementation (eg, hylan G-F 20 [Synvisc®]) in the study knee in the past 6 months
16. On prior stable therapy (ie, more than 3 days per week for the previous month) with an opioid analgesic prior to the screening visit will be excluded.
17. Recently started taking a sedative hypnotic medication for insomnia
18. Taking anti-depressants
19. Not willing to discontinue prohibited medications/therapies
20. Cannot tolerate acetaminophen
21. Re-entering study after dropping out or withdrawn from study
22. Used another investigational drug within the previous 30 days
23. On or currently applying for disability benefits on the basis of knee OA
24. History of fibromyalgia
25. Other painful or disabling conditions affecting the knee or leg, or disabling condition of the hands (used to apply the study drug)
26. Skin disorder with current involvement on the hands (used to apply the study drug) or the knee(s) (application site)
27. Referred to an orthopedic surgeon for consideration of, or been advised to have, knee replacement or knee reconstruction surgery
28. Radiologic evidence of OA of the knee advanced to the point that all cartilage has been eroded (ie, bone on bone)
29. Recently started using a cane within the past 30 days
30. History of chronic headaches that may require more than occasional use of rescue medication for headaches