IDE2 is a small molecule capable of inducing definitive endoderm from embryonic stem cells. It has been shown to induce the differentiation of Sox17+/FoxA2+-expressing pancreatic progenitors from human and mouse embryonic stems cells (EC50 = 223 nM in vitro) by activating the TGF-β signaling pathway. IDE2-derived endodermal cells injected into E8.75 mouse embryos ex vivo have been shown to incorporate into the developing gut tube, contributing to its formation. Furthermore, when treated with either indolactam V or a standard regimen of the growth factor FGF-10, retinoic acid, and hedgehog inhibitors, IDE2-induced endodermal cells can form Pdx1-expressing pancreatic progenitors.