News Release

BAXTER AWARDED CONTRACT FROM NIH FOR DEVELOPMENT OF SARS VACCINE

Deerfield, Ill., September 29, 2003 – Baxter Healthcare Corporation announced today that it has been awarded a $10 million contract by the National Institute of Allergy and Infectious Diseases (NIAID) to develop and produce an inactivated coronavirus vaccine against Severe Acute Respiratory Syndrome (SARS) for use by the National Institutes of Health (NIH) in phase I/II clinical trials.

Over the next one and one-half years, Baxter will develop and produce the vaccine using its proprietary vero cell technology platform, which has the potential for use with a broad range of viral vaccines. This vaccine platform has the potential to offer the advantage of a serum-free production medium, enabling high yield and purity, with no antibiotics, egg proteins, or mercury-containing preservatives.

“This is yet another example of the potential versatility and applicability of our proprietary vero cell technology platform in quickly responding to public health needs and emerging global threats,” said Kim C. Bush, president of Baxter’s vaccines business. “We are pleased to work in partnership with the NIH towards clinical testing of our candidate SARS vaccine and will diligently apply our extensive expertise and know-how to this high priority research and development project.”

Baxter’s pipeline of vaccines includes both viral and bacterial products derived from broadly applicable technology platforms, including large-scale cell culture techniques and polysaccharide-protein conjugates, and includes influenza and various meningococcal conjugates alone and in combination. Baxter's NeisVac-C meningococcal C conjugate vaccine currently is licensed in more than 30 countries. Using its vero cell technology, Baxter has participated in the production of approximately 155 million doses of smallpox vaccine, in conjunction with partner Acambis Inc., on behalf of the U.S. Department of Health and Human Services. Last year, Baxter received regulatory approval in the Netherlands for a novel influenza vaccine, PrefluCel, which also was developed using the company’s vero cell technology platform. The company is pursuing regulatory approval for PrefluCel in other European countries, and plans to initiate clinical trials in the United States in 2004.

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.

This news release contains forward-looking statements that involve risks and uncertainties, including technological advances in the medical field, product development risks, including technological difficulties, product demand and market acceptance, the effect of economic conditions, actions of regulatory bodies, the impact of competitive products and pricing, foreign currency exchange rates 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.

(Baxter, PrefluCel and NeisVac-C are trademarks of Baxter International Inc. and its affiliates.)

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