Baxter Switches Focus From Human To Genetically-Engineered Hemoglobin

Baxter Healthcare Corp. is withdrawing from the clinical development of HemAssist (DCLHb), its first-generation product derived from human hemoglobin, to concentrate its R&D efforts on genetically-engineered hemoglobin molecules.

The write-off of assets used in the manufacture of HemAssist, as well as production start-up costs and employee severance and relocation costs, will cost the Company $75 million against third-quarter net earnings. Baxter will modify its manufacturing facility in Neuchatel, Switzerland, which was designed to manufacture a human hemoglobin product, to produce other Baxter biopharmaceutical products.

Clinical results had indicated it was unlikely that HemAssist would meet Baxter's clinical trial standards for efficacy and safety. The Company has now suspended enrolling patients in the Phase III trials and determined that the resources necessary to re-enter clinical trials with HemAssist are better spent on a focused, second-generation recombinant program

"While we're disappointed, delays are sometimes part of the process of developing breakthrough medical therapies such as oxygen-carrying therapeutics," said Harry M. Jansen Kraemer, Jr., president of Baxter. "We remain committed to developing the second-generation products based on recombinant technology. We believe that by genetically engineering the hemoglobin molecule we can tailor products to better meet the needs of a variety of critically ill patients."

Baxter's second-generation R&D program will focus on recombinant technology—inserting the genetic information for making a therapeutic protein into the DNA of a cell. The DNA then instructs the cell to produce the desired protein, in this case a new form of hemoglobin.

"We believe there is a great clinical need for an oxygen-carrying therapeutic," said Thomas Schmitz, general manager of Baxter's hemoglobin therapeutics business. "We feel that the future generations of a product such as this are dependent upon the ability to tailor the hemoglobin molecule to meet the specific needs of a variety of critically ill patients."

For more information: Mary Thomas, Baxter Healthcare Corp. Telephone: 847-948-2815.