Baxter International Medical Device Company Intelligence Report

SUMMARY

Baxter International manufactures a diverse line of medical products and services for the delivery of therapies to people with life-threatening conditions, including cancer, trauma, haemophilia, immune deficiencies, infectious diseases and kidney disease. This report provides a full review of the company's activities.

Baxter International, based in Deerfield, Illinois, USA, manufactures products for people with life-threatening conditions such as cancer, trauma, haemophilia, immune deficiencies, infectious diseases and kidney disease. It operates in three segments, as follows:-

Medication Delivery - infusion systems, access systems, alternate care products, anaesthesia and critical care products, parenteral nutrition, injectable drugs and IV therapy products.

Renal - dialysis products and services, including peritoneal dialysis solutions, container systems and automated machines and solutions for haemodialysis (HD). The unit used to provide HD instruments but discontinued their manufacture in July 2005.

BioScience - recombinants, plasma proteins, antibody therapy, vaccines and regenerative medicine products. Also used to offer manual and automated blood collection products and storage equipment through its Transfusion Therapies unit but sold the business in February 2007.

Only Baxter's medical device activities are covered in this profile. These products include infusion systems and accessories, IV therapies and drug delivery products within the Medication Delivery segment, the whole Renal division and regenerative medicine products within the BioScience unit. Products such as drugs for IV delivery and anaesthesia, inhalation agents, coagulation factors, immune globulins, albumin, vaccines and dialysis solutions are not included.

Within Baxter's medical device operations, key areas of focus for Baxter include resuming sales of its infusion pumps and developing its peritoneal dialysis product line. A new area for the company in recent years has been biosurgery and regenerative medicine, including products for hard and soft tissue repair and regeneration. The company's investments in this area have included acquisitions, internal R&D and strategic alliances. The company has agreements with Vectura, whereby it offers the Adept adhesion reduction solution for use in obstetric and gynaecologic surgery and with Angiotech Pharmaceuticals for its CoSeal vascular sealant. Baxter also has a research agreement with Kuros for the development of biomaterials addressing hard and soft tissue repair. It also has rights outside the US to Angiotech's Adhibit non-drug-loaded surgical adhesion prevention product, as well as an option to obtain US rights for the product. In a move into other areas of regenerative medicine, Baxter is also investigating the use of stem cells in the treatment of chronic myocardial ischaemia.

Baxter believes its global presence and infrastructure is one of its key strengths. In 2006, 56% of Baxter's sales were generated outside the US and 58% of its workforce was internationally based. Baxter maintains 16 manufacturing facilities in US, including three in Puerto Rico. The company also manufactures in Australia, Austria, Belgium, Brazil, Canada, Chile, China, Colombia, Costa Rica, the Czech Republic, Germany, India, Ireland, Italy, Japan, Malta, Mexico, the Philippines, Poland, Singapore, Spain, Switzerland, Turkey and the UK. The majority of these facilities are shared by more than one of the company's business segments.

TABLE OF CONTENTS

• EXECUTIVE SUMMARY
• OVERVIEW
• Recent Key Events
• Financial Results
• Revenue by Operating Division, 2004-2006 (US$ million)
• Pre-tax Income by Operating Division, 2004-2006 (US$ million)
• Fig.1: Percentage of Revenue by Division, 2006
• Latest Results
• STRATEGIC FOCUS
• Medication Delivery
• Renal
• BioScience
• PRODUCT PORTFOLIO AND R&D
• Recent Product Approvals
• MEDICATION MANAGEMENT
• Medication Delivery Operating Results, 2004-2006 (US$ million)
• Medication Delivery Sales by Product, 2004-2006 (US$ million)
• Fig.2: Percentage of Medication Delivery Sales by Product, 2006
• Fig.3: Percentage of Medication Delivery Sales by Region, 2006
• Infusion Systems
• Colleague Volumetric Infusion Pumps
• Syndeo PCA Syringe Pump
• Colleague and Syndeo Pump Recall and Product Issues
• Ipump Pain Management System
• 6060 Multi-Therapy Product Discontinuation
• Infusion Systems Market
• IV Therapies
• Aviva
• Enlightened HRBC Technology
• Drug Delivery
• RENAL PRODUCTS
• Renal Operating Results, 2004-2006 (US$ million)
• Renal Sales by Product, 2004-2006 (US$ million)
• Fig.4: Percentage of Renal Sales by Product, 2006
• Fig.5: Percentage of Renal Sales by Region, 2006
• Renal Market
• Fig.6: Global Renal Products Market, US$9 billion, 2006*
• Fig.7: Global HD Products Market, 2006*
• Fig.8: Global PD Products Market, 2006*
• Fig.9: Dialysis Treatment Rate by Major Country (Patients per Million) 2006*
• Peritoneal Dialysis Products
• HomeChoice PRO System
• Haemodialysis Products
• RenalSoft Patient Management Software
• CRRT (Continuous Renal Replacement Therapy)
• BIOSCIENCE
• BioScience Operating Results, 2004-2006 (US$ million)
• BioScience Sales by Product Type, 2004-2006 (US$ million)
• Fig.10: Percentage of BioScience Sales by Product, 2006
• Fig.11: Percentage of BioScience Sales by Region, 2006
• Regenerative Medicine Products
• Fig.12: Percentage of BioSurgery Sales by Region, 2006*
• Fig.13: Global Biosurgicals Market, 2005*
• Adept Adhesion Reduction Solution
• TricOs T Bone Void Fille
• Tisseel VH Fibrin Sealant
• FloSeal
• CoSeal
• Cellular Therapies
• Isolex 300i Magnetic C Cell Selection System
• RESEARCH AND DEVELOPMENT
• Research Establishments
• Research Projects
• Medical Device R&D Pipeline
• Peritoneal Ultrafiltration Treatments for Congestive Heart Failure
• Adult Stem Cells for Heart Damage Repair
• Medication Delivery
• Research Agreements
• Kuros Biosurgery
• I-040302 for the Treatment of Solitary Bone Cysts
• Tibial Plateau Fractures
• Northwestern University's Institute For Bioengineering And Nanoscience In Advanced Medicine
• INTERNATIONAL ACTIVITIES
• Revenue by Region, 2004-2006 (US$ million)
• Total Assets by Geographic Location, 2004-2006 (US$ million)
• Fig.14: Percentage of Revenue by Geographic Area, 2006
• Fig.15: Revenue by Geographic Area, 1997-2004 (US$ million)
• Fig.16: Percentage of Total Assets by Geographic Area, 2006
• Fig.17: Percentage of Employees by Geographic Area, 2006
• GLOBAL FACILITIES
• Americas
• United States
• Canada
• Costa Rica
• Puerto Rico
• Mexico
• Europe
• Austria
• Belgium
• Czech Republic
• Germany
• Ireland
• Italy
• Switzerland
• Turkey
• United Kingdom
• Asia-Pacific
• Australia and New Zealand
• China
• India
• Japan
• Singapore
• Major Manufacturing Locations
• APPENDICES
• APPENDIX 1 - FINANCIAL INDICATORS
• FINANCIAL INDICATORS
• APPENDIX 2 - KEY CORPORATE EVENTS
• APPENDIX 3 - MERGERS AND ACQUISITIONS
• Epic Therapeutics
• Wockhardt Life Sciences' IV Fluids Business
• Fusion Medical Technologies
• Autros Healthcare Solutions
• Asta Medica Onkologie
• Nexell Therapeutics' Cell Processing Products
• Cook Pharmaceutical Solutions
• Dade Behring's Technical Service Operations
• Sera-Tec Biologicals
• Orion's Intravenous Infusion and Nutrition Businesses
• Althin Biopharm
• Althin Medical
• Sabratek's Infusion Pump Business and Rocap Product Line
• Pharmacia & Upjohn's German Nutrition Business
• Bieffe Medital's IV Therapy and Irrigating Solutions Business
• Clintec Nutrition Business
• APPENDIX 4 - JOINT VENTURES
• Parenteral Nutrition Venture in China
• Eczacibasi Baxter Hospital Supply Products Company
• APPENDIX 5 - DIVESTITURES
• Transfusion Therapies Unit
• Disposable Airway Management Business
• Renal Service Businesses
• PFC Therapeutics
• Admixture Products and Services
• Edwards Japan
• Cardiovascular Business
• Productivity Systems Business Assets
• Sure-Med
• Industrial and Life Sciences Division
• Diagnostic Products Manufacturing Operations
• Tower Packaging Business
• Caremark
• APPENDIX 6 - AGREEMENTS
• Key Agreements
• Vectura
• Gambro
• Zimmer
• Miltenyi Biotec
• Angiotech Pharmaceuticals
• Mayo Clinic
• Becton Dickinson
• Minntech
• Medisystems
• Med Enclosure
• Supply Agreements
• Department of Veterans Affairs
• Premier
• APPENDIX 7 - LITIGATION
• Fresenius
• Securities and Incentive Investment Plan Lawsuits
• Althane Series Dialysers
• Breast Implant Litigation
• Colleague and Syndeo Pumps

Index of Tables

• Recent Key Events
• Revenue by Operating Division, 2004-2006 (US$ million)
• Pre-tax Income by Operating Division, 2004-2006 (US$ million)
• Recent Product Approvals
• Medication Delivery Operating Results, 2004-2006 (US$ million)
• Medication Delivery Sales by Product, 2004-2006 (US$ million)
• Renal Operating Results, 2004-2006 (US$ million)
• Renal Sales by Product, 2004-2006 (US$ million)
• BioScience Operating Results, 2004-2006 (US$ million)
• BioScience Sales by Product Type, 2004-2006 (US$ million)
• Medical Device R&D Pipeline
• Revenue by Region, 2004-2006 (US$ million)
• Total Assets by Geographic Location, 2004-2006 (US$ million)
• Major Manufacturing Locations
• Key Agreements

Index of Charts

• Fig.1: Percentage of Revenue by Division, 2006
• Fig.2: Percentage of Medication Delivery Sales by Product, 2006
• Fig.3: Percentage of Medication Delivery Sales by Region, 2006
• Fig.4: Percentage of Renal Sales by Product, 2006
• Fig.5: Percentage of Renal Sales by Region, 2006
• Fig.6: Global Renal Products Market, US$9 billion, 2006*
• Fig.7: Global HD Products Market, 2006*
• Fig.8: Global PD Products Market, 2006*
• Fig.9: Dialysis Treatment Rate by Major Country (Patients per Million) 2006*
• Fig.10: Percentage of BioScience Sales by Product, 2006
• Fig.11: Percentage of BioScience Sales by Region, 2006
• Fig.12: Percentage of BioSurgery Sales by Region, 2006*
• Fig.13: Global Biosurgicals Market, 2005*
• Fig.14: Percentage of Revenue by Geographic Area, 2006
• Fig.15: Revenue by Geographic Area, 1997-2004 (US$ million)
• Fig.16: Percentage of Total Assets by Geographic Area, 2006
• Fig.17: Percentage of Employees by Geographic Area, 2006
• FINANCIAL INDICATORS