Baxter And The American National Red Cross Agree To Terminate Contract Manufacturing Arrangement For Plasma Products

DEERFIELD, Ill., and WASHINGTON, March 1 /PRNewswire-FirstCall/ -- Baxter Healthcare Corporation and the American National Red Cross (Red Cross) announced today that they have signed a new, long-term plasma procurement contract. Under this new agreement, Baxter will purchase plasma from the Red Cross, effective July 1, 2005. Based upon a strategic review of its Plasma Services business, the Red Cross informed Baxter that it intended to exit the plasma therapeutics business. As a result, the parties agreed to terminate their long-standing, contract manufacturing arrangement for the processing of plasma products.

"This new agreement permits Baxter to continue to utilize its existing capacity for plasma processing and enhances our manufacturing flexibility and efficiency," said Joy Amundson, president of Baxter's BioScience business. "Our goal is also to ensure there is no interruption of supply in the marketplace and we intend to offer our products and leading patient support and service programs to the patients and customers who today rely on Red Cross branded plasma therapies."

"We are pleased to enter into this plasma supply arrangement with Baxter, which will allow us to focus our efforts on our core mission of providing a safe and available blood supply," said Jack McGuire, executive vice president, American Red Cross Biomedical Services.

Based on the prior arrangement with the Red Cross, Baxter had dedicated capacity at its fractionation facility in Los Angeles, Calif. for the processing of Red Cross plasma products. Baxter does not expect any material change to its level of plasma production as a result of the new plasma procurement agreement.

Baxter expects the financial impact from the new arrangement to be immaterial in 2005 and expects an increase in annual revenues of antibody therapy and other plasma protein products of approximately $100 million in 2006 due to the change from the Red Cross contract manufacturing arrangement to direct sales of plasma products. Other financial terms of the agreement were not disclosed.

Baxter Healthcare Corporation is the principal U.S. operating subsidiary of Baxter International Inc. . Baxter International Inc., through its subsidiaries, assists healthcare professionals and their patients with treatment of complex medical conditions, including cancer, hemophilia, immune disorders, kidney disease and trauma. The company applies its expertise in medical devices, pharmaceuticals and biotechnology to make a meaningful difference in patients' lives. For more information about Baxter, please visit .

This news release contains forward-looking statements that involve risks and uncertainties. Actual results could differ materially from the above forward-looking statements as a result of certain factors, including: the risk and uncertainties related to the effect of economic conditions; the impact of geographic and/or product mix on the company's sales; actions of regulatory bodies and other government authorities, including the FDA and foreign counterparts that could delay, limit or suspend product sales and distribution; product quality and/or patient safety concerns, leading to product recalls, withdrawals, launch delays or declining sales; product development risks; product demand and market acceptance; the impact of competitive products and pricing; the availability of acceptable raw materials and component supply; product and technical advances that could change prescribing practices and patterns; and other factors described in the company's filings with the Securities and Exchange Commission. The company does not undertake any obligation to update any forward-looking statements as a result of new information, future events, changed assumptions or otherwise, and all forward-looking statements speak only as of the time when made. Actual results or experience could differ materially from the forward-looking statements.

Baxter International Inc.

CONTACT: media, Cindy Resman of Baxter, +1-847-948-2815; or Ryland Dodgeof American Red Cross, +1-202-303-5492; or investors, Mary Kay Ladone ofBaxter, +1-847-948-3371

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