News Release

FEDERAL COURT DISMISSES SHAREHOLDER SUIT AGAINST BAXTER AND ITS OFFICERS

DEERFIELD, Ill., July 29, 2003 -- Baxter International Inc. (NYSE:BAX) announced today that Judge Blanche M. Manning of the United States District Court for the Northern District of Illinois has dismissed, in its entirety, a consolidated securities class action complaint filed against Baxter and various officers of the Company.

Several plaintiffs had sued Baxter in August 2002, alleging violations of the federal securities laws in connection with Baxter's disclosures, prior to July 18, 2002, of certain estimates regarding its performance in full-year 2002. The plaintiffs filed a consolidated complaint in December 2002, and Baxter and the individual defendants then filed a motion to dismiss the complaint.

On July 17, 2003, Judge Manning granted Baxter's motion and dismissed all claims against Baxter and its officers in their entirety. The District Court ruled in its July 17 opinion that Baxter's disclosures were accompanied by substantive and sufficiently tailored cautionary language. At a hearing before Judge Manning earlier today, plaintiffs indicated that they intend to appeal the District Court's decision.

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.

FOR ADDITIONAL INFORMATION:

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