The purpose of this study is to evaluate the efficacy and safety of the study drug ZGN-1061 in participants with type 2 diabetes.

Participants will be enrolled in 1 of 2 groups. Approximately 120 participants will receive 0.05, 0.3, or 0.9 mg of ZGN-1061 or placebo (Group 1). An additional 40 participants will receive 0.9 or 1.8 mg of ZGN-1061 or placebo (Group 2).

Inclusion Criteria:

Subjects must meet the following criteria to participate in this study:

• Be between the ages of 18 and 70 years, inclusive.
• Overweight or obese with a body mass index of at least 27 kg/m².
• Have type 2 diabetes with HbA1c between 7% and 11%.
• For subjects taking approved antidiabetes medications, the doses must be stable as determined by the study doctor.
• For subjects who have had weight-loss surgery (example: gastric banding), the procedure must have occurred at least 1 year ago, and be verified with documentation or by a health professional associated with the surgery.

Exclusion Criteria:

Subjects cannot participate in this research study if they meet any of the following:

• Have taken another study drug or study device within the past 6 months.
• Are taking certain prescribed medications including narcotics or opiates.
• Consistent recent use of insulin.
• Have had recent major surgery or prolonged bed rest, or planning or likely to undergo any surgery during the research study.
• Have a history of bleeding disorders or risk factors for excessive blood clotting.
• Have difficulty giving blood.
• Have a history of drug and/or alcohol abuse.