Inclusion Criteria:

• Age 18-64
• Diagnosed with and under physicians care for osteoarthritis of the knee according to American College of Rheumatology Criteria with radiographic evidence demonstrating at least grade 1 OA
• Report at least typical arthritic pain>4 out of 10 (0=no pain, 10=the most extreme pain imaginable)
• Meet DSM-IV and ICSD-R criteria for either primary (psychophysiologic) insomnia or insomnia secondary to osteoarthritis
• Insomnia symptoms must include problems with middle of the night awakenings
• Insomnia symptom duration > 6 months
• Baseline, 2-week, sleep diary average wake after sleep onset time >30 minutes
• Baseline self-reported total sleep time < 6.5 hours per night
• Patients taking NSAID therapy for pain must be on a stable dose for a period of at least one month prior to initiating the study

Exclusion Criteria:

• Intrinsic sleep disorders other than insomnia (sleep apnea, periodic limb movement disorder, etc)
• Significant rheumatologic or chronic pain disorders other than osteoarthritis of the knee, including fibromyalgia or the complaint of widespread pain impacting 4 quadrants, complex regional pain syndrome, post herpetic neuralgia, etc)
• Major medical disease (including, hepatic impairment, chronic obstructive pulmonary disease/compromised respiratory function, cancer, dementia, diabetes, congestive heart failure, cerebrovascular disease, raynaud’s syndrome)
• Active major psychiatric disorders (including dementia or cognitive impairment) and history of schizophrenia or bipolar I disorder
• History of serious suicide attempt; 6) history of alcohol or substance (including prescription medications) abuse
• Pregnancy or plans to become pregnant within 6 months
• Intraarticular steroid injection within the past month
• Regular (>3 days/week) use of antidepressants, antipsychotics, and mood stabilizers, within the past two months
• Regular (> 3/week) use of myorelaxants, narcotics, sedative hypnotics, and anticonvulsants within the past one month
• Unwilling or unable to discontinue all use of the medications listed in #10 for two weeks prior to starting the study
• Unwilling or unable to discontinue all centrally acting agents and all analgesic usage within 24 hours of pain testing sessions
• Refusal to provide consent to contact patient’s physician to establish diagnosis and obtain medical record information
• Regular tobacco or nicotine use
• Heavy caffeine use [(>2 cups of coffee/day (equivalent)
• History of previous allergic reaction or severe side effects to sedative hypnotics
• Use of potent CYP3A4 inhibitors (e.g., ketoconazole, itraconazole, clarithromycin, troleandomycin, ritonavir, nelfinavir)
• In addition, subjects will undergo in-laboratory blood tests prior to receiving drug and will be excluded from further participation if they exhibit: a) positive pregnancy test, b) positive toxicology (benzodiazepine, opioids, THC, alcohol, and stimulants), c) abnormal liver enzyme panel