News Release

FDA APPROVES BAXTER'S ADVATE FOR THE TREATMENT OF HEMOPHILIA A

Deerfield, Ill., July 25, 2003 -- Baxter Healthcare Corporation announced today that the U.S. Food and Drug Administration (FDA) has approved ADVATE (Antihemophilic Factor (Recombinant), Plasma/Albumin-Free Method) rAHF-PFM for the prevention and control of bleeding episodes in people with hemophilia A. ADVATE is the first and only factor VIII made without any added human or animal plasma proteins and albumin in the cell culture process, purification and final formulation, thereby eliminating the risk of infections caused by viruses that may be carried in these proteins.

Developed by Baxter through its innovative technology and many years in hemophilia research, ADVATE is a genetically engineered, or recombinant, full-length clotting factor VIII that is similar to the natural clotting factor found in a healthy body. The new technology used to prepare ADVATE - which is the most advanced factor VIII treatment for hemophilia to date - eliminates the addition of human and animal plasma proteins and albumin to provide unsurpassed pathogen safety, while maintaining the proven efficacy of the full-length RECOMBINATE rAHF molecule, the current leader for hemophilia A therapy.

"It's widely recognized by the hemophilia community that there is a need to provide patients with treatments that eliminate the risk for infection. While treatment options to date have provided effective disease management, there has been an acknowledged, lingering concern about the potential for viral transmission with these therapies," said Michael Tarantino, M.D., associate professor of Pediatrics at the University of Illinois and medical director of the Comprehensive Bleeding Disorder Center in Peoria, Ill. "ADVATE is the first therapy to meet this need for safety, virtually eliminating the risk of transmission of human pathogens."

Other genetically engineered factor VIII therapies use human plasma protein solutions and/or other human- or animal-derived materials during processing, or add human albumin for stabilization. These components have the potential to carry disease-causing viruses or pathogens, such as HIV, West Nile Virus or variant Creutzfeldt-Jakob Disease (vCJD), the human form of mad cow disease. The Medical and Scientific Advisory Council (MASAC) of the National Hemophilia Foundation has issued formal recommendations (#141) advising that "all efforts should be made to remove human albumin from recombinant factor VIII products" and " increased efforts should be made to eliminate human and bovine proteins from the manufacturing process of recombinant products." ADVATE is the first and only FDA-approved factor VIII therapy to meet these guidelines.

"During the last 40 years, Baxter has strived continually to provide the hemophilia community with enhanced, safer factor VIII therapeutics. The FDA approval of ADVATE marks another important milestone for Baxter and the hemophilia community," said Thomas Glanzmann, president, Baxter BioScience. "Baxter is pleased to have consistently met the needs of the hemophilia community by introducing innovative technology to elevate the standard of care."

ADVATE CLINICAL DATA

Phase II-III clinical trials evaluated the safety, immunogenicity and efficacy of ADVATE in the treatment and prevention of bleeding in previously treated hemophilia patients in a variety of clinical settings. Data demonstrate that ADVATE has equivalent pharmacokinetic properties to RECOMBINATE, and is effective in controlling bleeding episodes, which can occur as often as three times per month in patients with severe hemophilia A.

"The development of ADVATE is based on our scientific expertise and application of innovative technologies to advance the treatment of hemophilia," said Norbert Riedel, Ph.D., chief scientific officer, Baxter. "ADVATE is the first and only factor VIII therapy that combines the unsurpassed pathogen safety of a plasma/albumin-free method with the proven efficacy of the RECOMBINATE molecule."

Side effects with the use of ADVATE are uncommon, with no serious adverse events related to treatment with ADVATE reported to date. Non-serious, moderate or mild adverse events related to ADVATE include: a strange taste, itching at the infusion site, dizziness, headaches, catheter-related infections, chills, hot flashes, diarrhea, lower limb edema, sweating, nausea, pain in the upper abdomen or lower chest, prolonged bleeding after post-operative drain removal, decreased red blood cell count, joint swelling and shortness of breath. Non-serious, but severe related adverse events include: fever, headache and decreased coagulation factor VIII levels.

ABOUT ADVATE

ADVATE is a blood-clotting therapy that helps people with hemophilia A prevent and control bleeding episodes. Infused directly into the bloodstream, ADVATE works by temporarily raising the level of factor VIII in the blood, thus allowing the body's blood clotting process to function properly. Baxter expects to begin shipping ADVATE to distributors in 3-6 weeks.

ADVATE is also convenient to use because it is available in super-high potency (1500 IU/vial), with a smaller infusion volume (5mL diluent), which means shorter infusion times for patients. ADVATE comes packaged with a 10mL syringe, butterfly bandage, alcohol swab and a patient-friendly package insert.

ADVATE is processed by Baxter in its state-of-the art, multi-purpose, biotechnology facility in Neuchâtel, Switzerland. This facility has the capacity to help ensure sufficient supplies of this therapy based on current and anticipated patient needs.

ADVATE is under regulatory review in Europe and Canada following Baxter's submission of a Marketing Authorization Application to the European Medicines Evaluation Agency through the European Union Centralized Procedure, and a New Drug Submission with Health Canada's Drug's Directorate in September 2002.

ABOUT HEMOPHILIA

People with hemophilia A do not produce adequate amounts of factor VIII, which is necessary to effectively clot blood. Without enough factor VIII, patients can experience spontaneous, uncontrolled internal bleeding that is painful, debilitating and damaging to joints. If untreated, patients with severe hemophilia A have a greatly reduced life expectancy.

According to the World Health Organization, more than 400,000 people in the world may have hemophilia A and it affects 15-20 of every 100,000 males born worldwide. People with hemophilia A infuse themselves with clotting factors three times a month, on average, unless they are on a preventive regimen, in which case their physician may prescribe infusing a therapy as often as three or four times per week.

ABOUT BAXTER

Baxter Healthcare Corporation is the principal domestic operating subsidiary of Baxter International Inc. (NYSE: BAX). Baxter International Inc., through its subsidiaries, assists health-care 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.

Questions and Answers

What are the labeling differences between RECOMBINATE and ADVATE?
ADVATE is derived from the same full-length molecule as RECOMBINATE and, therefore, has a similar label and indication. However, ADVATE offers greater convenience based on its higher potency and lower infusion volume, as well as the safety of its innovative plasma/albumin-free process.

Will ADVATE be priced higher than RECOMBINATE?
ADVATE is priced slightly higher than RECOMBINATE, but within the range of existing recombinant factor VIII therapies. This is based on the fact that ADVATE is the most advanced hemophilia therapy available, combining unsurpassed pathogen safety with the proven efficacy of the RECOMBINATE molecule. ADVATE was also developed using complex, innovative technology.

Are you expecting any large initial stocking orders?
We are in discussions with our customers and home care companies to ensure we provide them with the product necessary to meet the needs of their patients.

What do you anticipate will drive ADVATE sales in the U.S.?
Based on its many advantages, we believe ADVATE will appeal to a broad spectrum of customers. We anticipate the key drivers for ADVATE use to include patients switching from RECOMBINATE, patients switching from plasma-based products and patients switching from competitive products.

Do you anticipate patients will switch to ADVATE from RECOMBINATE or from competitor's products?
We anticipate many patients will switch to ADVATE regardless of what their current therapy may be. The hemophilia community has indicated there will be a high demand for this innovative therapy because it removes concerns about unknown viruses and infectious proteins carried in protein additives.

What are your expected recombinant sales (ADVATE and RECOMBINATE combined) in 2003?
We expect that Baxter's global recombinant sales (from both ADVATE and RECOMBINATE) will grow more than 10 percent in 2003.

What is the size of the global recombinant marketplace?
The current recombinant marketplace is approximately 1.9 billion activity units. We expect this market to grow to 2.5-2.9 billion units by 2005 based on continued increases in availability and promotion of recombinant products. The three key drivers of the recombinant market are conversion from plasma-derived therapies, adequate dosing and compliance, and increasing prophylactic use of these therapies.

When do you expect European approval?
We continue to anticipate European approval in the second half of this year.

What clinical studies are included in the development program for ADVATE?
There are seven clinical studies in the development program for ADVATE:

• Pivotal Study in Previously Treated Patients - data presented at the American Society of Hemotology Annual Meeting, December, 2002
• Continuation Study of Previously Treated Patients - (ongoing) preliminary data presented at the International Society for Thrombosis and Haemostasis (ISTH) meeting, July 2003
• Surgery Study - (ongoing) preliminary data presented at the ISTH meeting, July 2003
• Pediatric Study - (ongoing) preliminary data presented at the ISTH meeting, July 2003
• Study in Japanese Patients - required for regulatory submission in Japan

Baxter also plans to initiate a study in previously untreated patients and also has plans for additional Phase IV studies.

Baxter, ADVATE, and RECOMBINATE are trademarks of Baxter International Inc. and its affiliates.

Please see full prescribing information or visit www.advate.com for further information.

This news release contains forward-looking statements that involve risks and uncertainties, including technological advances in the medical field, the effect of economic conditions, actions by regulatory authorities at any stage of the development and commercialization process, product demand and market acceptance, the impact of competitive products and pricing, and other risks detailed in the company's filings with the Securities and Exchange Commission. These forward-looking statements are based on estimates and assumptions made by management of the company and are believed to be reasonable, though are inherently uncertain and difficult to predict. Actual results or experience could differ materially from the forward-looking statements.

FOR ADDITIONAL INFORMATION:

	For Baxter Media Contacts: Cindy Resman, 847-948-2815 Deborah Spak, 847-948-2349 Investor Contacts: Neville Jeharajah, 847-948-2875 Mary Kay Ladone, 847-948-3371