An R&D giantPouring almost $1 million a day into research and development, Baxter is the world's largest maker of hospital and healthcare products. The company's more than 200,000 products include heart valves, blood collection and processing machines and cardiac catheters. In 1996 the company spun off Allegiance Corporation, its cost-management services unit. Allegiance has expanded its line of surgical and respiratory-care products and management services, while Baxter has refocused on its core technologies like intravenous therapy, renal therapy, blood-related products and cardiovascular. Baxter spun off its cardiovascular branch in summer 1999 to form Edwards Lifesciences. The spin-off made the company an effective player in the CV industry.
Baxter's history of high tech health care innovations began in 1931 when Donald Baxter, a California physician, founded the company to distribute the intravenous products he had developed. One of Baxter's partners, Ralph Falk, bought him out in 1935 and began spearheading the research and development efforts that would establish the company's reputation. In 1962 Baxter introduced the first disposable total-bypass blood-oxygenator, which made open heart surgery possible. The company has benefited from such deals as a 1994 distribution agreement with health care giant Columbia/HCA.
Looking foreign
Baxter has positioned its stake in the future on twin poles: foreign expansion and research and development. In 1996 the company earned over half of its revenues from overseas markets, with Europe constituting half of the company's international business. Additionally, Baxter is the largest foreign health care organization in Japan, where sales top $500 million. The firm now operates 50 manufacturing plants in 20 countries.
Under pressure from the Clinton Administration to reform its prescription drug pricing practices, Baxter has continued to expand. It has acquired Sweden-based Althin Medical A.B.; Canada-based Althin Biopharm Inc.; and Maryland-based North American Vaccine. Further, in April 2000, Baxter teamed with four other large hospital suppliers to create an electronic exchange that will facilitate product-ordering and offer transaction-processing over the Internet.
