BAXTER GETS CONTRACT FROM U.K. NHS FOR H5N1 FLU VACCINE.

Baxter International Inc. (NYSE:BAX) has announced that its European subsidiary has received a contract from the National Health Service (NHS) in the United Kingdom to produce a stockpile of two million doses of candidate H5N1 influenza vaccine based on an avian strain. Under the agreement, Baxter will complete delivery of the stockpile to the NHS in 2006.

"We are proud to provide the necessary technology, manufacturing capability and other resources to assist the National Health Service in its efforts to protect individuals from the threat of a flu pandemic," said Joy Amundson, corporate vice president and president of Baxter's BioScience business.

Baxter also is working with the U.S. National Institute of Allergy and Infectious Diseases (NIAID), part of the National Institutes of Health (NIH), to develop a cell culture-based H5N1 candidate pandemic influenza vaccine. Baxter will be providing the candidate vaccine to NIAID for clinical testing in the United States, which is expected to be initiated in 2006. In addition, Baxter is in discussions with several other governments regarding its candidate pandemic vaccine.

Cell-based systems for production of vaccines offer a number of potential benefits over more traditional, chicken egg-based systems. Baxter's vero-cell system is capable of producing high yields of influenza virus without the addition of any animal-derived serum. Through the company's research and development work, Baxter has been successful in growing wild-type virus in its vero-cell culture, which means that the company could begin vaccine production without having to wait for high-growth or attenuated virus reassortants normally used when vaccine is produced in eggs.

Baxter's vaccine production facilities are engineered for BioSafety Level 3 production, which means that they can use wild-type strains to help accelerate production.

A candidate vaccine is a vaccine under development that has not undergone full clinical testing to demonstrate its safety and efficacy. Wild-type virus is virus as it comes out of nature, i.e. not manipulated in any manner to make it easier to manufacture through traditional methods.

"Given the benefits that our vero cell platform offers for efficiency, scale and timing, we believe that it holds significant potential for protecting public health on a global basis," Amundson said. "We look forward to continuing development and initiating clinical testing of the safety and immunogenicity of this candidate vaccine for pandemic flu, and demonstrating the advantages that cell-based production can offer for manufacturing vaccines."

Over the years, the company has partnered with governments around the world to develop and produce vaccines and other therapeutics to protect against bioterrorism and infectious diseases. In partnership with Acambis Inc., Baxter has supplied stockpiles of vero cell-derived smallpox vaccine to the U.S. government and 12 countries worldwide. In Fall 2003, the company was awarded a contract by the NIAID in the United States to develop and produce an inactivated coronavirus vaccine against Severe Acute Respiratory Syndrome (SARS) for use by the NIH in phase I/II clinical trials. In 2005, Baxter, in partnership with Dynport Vaccine company, was awarded a contract for the development of a plasma-based therapeutic targeted for use in individuals who may be exposed to nerve gas poisons.

Baxter International Inc., through its subsidiaries, assists healthcare professionals and their patients with the 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, visit http://www.baxter.com or call 847/948-3371.