Loaiza, who became a celebrity in his native Mexico, made his first appearance in San Diego County Superior Court in Chula Vista, California, since his arrest last week. The 46-year-old retired athlete did not speak in court but did look at his father and other family members before his defense attorney entered his not guilty plea.
Prosecutors charged Loaiza, 46, with possession and transportation for sale of more than 10 kilograms (22 pounds) of cocaine, a cocaine base or heroin, and using a false compartment to smuggle drugs.
The specification of more than 10 kilograms could draw a stiffer penalty as could the allegation that the drugs were being stored at a townhome he leased that was within a 1,000 feet (305 meters) of an elementary school.
The baseball star would face up to 20 years and eight months in prison if convicted.
Loaiza has been behind bars since he was arrested Friday on suspicion of drug smuggling after San Diego County sheriff's officers who pulled over the Mercedes Benz he was driving for a traffic violation found a "sophisticated" compartment used to hide contraband at the back of the vehicle, according to investigators.
He had crossed the Mexican border earlier that same day, prosecutors said.
Later, authorities obtained a search warrant for the home he rented in the community of Imperial Beach, where officials say packages were found containing a white powder believed to be cocaine and that weighed a total of 20 kilograms (44 pounds). The charges are for any amount over 10 kilograms, prosecutors said.
Bail was originally set at $200,000 but the judge Wednesday raised it to $250,000 after deputy district attorney Ryan Karkenny argued the Mexican pitcher poses a flight risk, saying he has lived on both sides of the border and has access to "significant funds."
Defense attorney Janice Deaton agreed to the terms, though it was unclear if the ex-pitcher would post bail. Deaton as well as Loaiza's relatives left the courtroom without speaking to reporters, and the attorney did not immediately return phone calls seeking comment.
Born in Tijuana, across the border from San Diego, Loaiza became a star athlete in the US. He played for numerous teams between 1995 and 2008, included stints with the Pittsburgh Pirates, the New York Yankees, the Los Angeles Dodgers and the Chicago White Sox. He had a 21-9 record with the Chicago White Sox in 2003 and started in the All-Star Game that year.
He last appeared in the majors in 2008 with the White Sox.
Two years later, he married Mexican-American singer Jenni Rivera. The "Diva de la Banda" was considered to be the most successful female singer in grupero, a male-dominated Mexico regional style, selling more than 15 million records, and acting in reality television before she was killed in a plane crash in 2012.
She filed for divorce shortly before her death, ending their two-year marriage.
Investigators have said the arrest was part of an on-going narcotics probe but have given few details about how a successful baseball star became linked to a case involving the transport and sale of drugs with an estimated value of $500,000.
Criminal defense attorney, David Shapiro, who has handled numerous drug cases in San Diego but is not representing Loaiza, said this one is unique because of his fame as one of Mexico's most successful pitchers.
"At the very least what it shows is how Mexico's drug culture is infiltrating every aspect of life, whether he was associated with people doing it or doing it himself," he said.
Agent John Boggs, who represented Loaiza during his MLB career, said he had not seen him in more than a year but that he had heard he was involved in a business selling Mexican-made hats.
"I love Esteban," Boggs told the San Diego Union-Tribune. "He's a great guy with a big heart - again, I don't know what or why he'd be involved in this. I have no idea. He's a friend, and I'm sorry as heck to see what's going on."
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