Inclusion Criteria:

1. Age range: Subjects > 50 years of age.
2. Sex distribution: both men and women. Women must be two (2) years post-menopausal or surgically sterile. Women of child bearing potential (< 1 year post menopausal) must be practicing effective contraception and have a negative ß-hCG at screening (Women who are breast feeding are excluded).
3. MMSE scores between 5 and 24 (inclusive).
4. Subjects must have diagnostic evidence of possible or probable AD either prior to or at the screening visit based on Diagnostic and Statistical Manual of Mental Disorders-IV (DSM-IV) and National Institute of Neurological and Communicative Disorders and Stroke criteria.
5. CT or MRI within the last 12 months consistent with a diagnosis of AD without any other clinically significant comorbid pathologies found. A copy of the report will be required and will be collected. If there has been a significant change in clinical status suggestive of stroke or other neurological disease in addition to AD with onset between the time of the last CT or MRI and the screening evaluation, the scan should be repeated during screening.
6. The caregiver/ informant can be a family member or a professional and must have had contact with the subject at least 6 Weeks prior to study entry and spent at minimum 3 days a Week (10 hours per Week) with the subject. For study visit, the subject can be seen at the Assisted Living Facility (ALF) or in the clinic setting of the Investigator. At each visit, the caregiver/informant will provide the information for completion of the safety and efficacy assessments based on knowledge of and time spent with the subject.
7. Subjects must reside in an ALF.
8. The subject is expected to complete all procedures scheduled during the screening, baseline, interim, and final visits including all efficacy assessments.
9. Putative non-prescription/prescription cognitive enhancers (e.g. ginkgo, high-dose vitamin E, lecithin, estrogen, non-steroidal anti-inflammatory drugs [NSAIDs]) will not be excluded but will be discouraged. If a putative cognitive enhancer is present, the dosage must have been stable for at least 3 months prior to the screening visit and should not change during the course of the study.
10. Subjects with controlled hypertension (sitting diastolic BP < 95 mmHg), right bundle branch block (complete or partial), and pacemakers may be included in the study.
11. Subjects with thyroid disease also may be included in the study provided they are euthyroid and stable on treatment for at least 3 months prior to screening.
12. Subjects with a history of seizure disorder are allowed provided that they are on stable treatment for at least 3 months prior to screening and have not had a seizure within the past 6 months.
13. Subjects must be able to swallow tablet medication -- no crushing of tablet is allowed.
14. Health: independent or ambulatory aided (i.e., walker or cane, to wheelchair); vision and hearing (eyeglasses and/or hearing aid permissible) sufficient for compliance with testing procedures.
15. Subjects must be sufficiently proficient in the language in which the assessments are to be conducted.
16. Subjects must have clinical laboratory values within normal limits, and within the Eisai (sponsor) guidelines, or abnormalities considered not clinically significant by the investigator and sponsor.

Exclusion Criteria:

1. Age range: Subjects < 50 years of age.
2. MMSE score of ≤4 or ≥25.
3. Subjects with active or clinically significant conditions affecting absorption, distribution or metabolism of the study medication (e.g., inflammatory bowel disease, gastric or duodenal ulcers or severe lactose intolerance).
4. Subjects with a known hypersensitivity to piperidine derivatives or cholinesterase inhibitors.
5. Subjects living in a skilled nursing home or subjects living in an ALF who may be moved to a skilled nursing home during the course of the study. Subjects who transfer from an ALF to a skilled nursing home during this study will be discontinued.
6. Subjects who have taken the following medications within the last 3 months prior to screening will be not eligible: Aricept, Exelon, Cognex, Razadyne, Metrifonate, Namenda or propentofylline.
7. Subjects without a reliable caregiver/informant or subjects whose caregiver is unwilling or unable to complete the outcome measures and fulfill the requirements of this study.
8. Subjects with clinically significant obstructive pulmonary disease or asthma, untreated for > 3 months.
9. Subjects with recent (< 2 years) hematologic/ oncologic disorders, not including mild anemia or basal or squamous cell carcinoma of the skin. Subjects with current evidence of malignant neoplasm or recurrent or metastatic disease will be excluded.
10. Evidence of clinically significant, active gastrointestinal, renal, hepatic, endocrine or cardiovascular system disease.
11. Subject with a current DSM-lV diagnosis of Major Depressive Disorder (MDD) or any current primary psychiatric diagnosis other than Alzheimer's disease (as per DSM-lV).
12. Subjects with dementia complicated by other organic disease (DSM 290.30 or 290.11) are excluded; depression or delusions are common in Alzheimer's disease, and subjects with severe symptoms so pronounced that they warrant an alternative, concurrent diagnosis, are excluded.
13. Subjects with a known or suspected history of alcoholism or drug abuse (within the past 10 years).
14. Subjects with treated hypothyroidism that have not been on a stable dose of medication for 3 months prior to screening and who do not have normal serum Free T3, Free T4 and TSH at screening.
15. Subjects with treated vitamin B-12 deficiency who have not been on a stable dose of medication for at least 3 months prior to the study screening visit and who do not have normal serum B-12 levels at screening.
16. Any subject taking a prohibited medication will be excluded.
17. Any condition which would make the subject or the caregiver, in the opinion of the investigator, unsuitable for the study.