Baxter also cut its sales and earnings forecast for 2003, citing increased competition in the blood products market. Story from Bloomberg Financial.

Baxter shares fell over 20 percent during the day's trading.

October 15, 2002 - The Croatian government has ended its criminal probe into the deaths of 21 kidney patients last year linked to Baxter dialyzers. Story from Reuters (link no longer available).

March 27, 2002 - The first paper from the nephrology community has appeared on the sudden deaths of up to 50 dialysis patients last year due to exposure to perfluorohydrocarbon. The full-text of a Nephrology Dialysis Transplantation editorial comment by Bernard Canaud (on behalf of the European Experts Panel) is available on-line today.

(See related RenalWEB news page about this editorial.)

According to the editorial, errors appear to have occurred at several levels:

• "At the level of the dialyser manufacturer (Baxter), the removal of the fluid was apparently not adequate and quality control tests were not efficient in detecting any residual material."
  
• "At the level of the regulatory notified body (TÜV), the incriminated dialysers reassessed after the first outbreak episode, were considered safe and in strict accordance with original certified dialysers."
• "At the level of the user (dialysis unit), it is probable that the priming and cleaning procedure of the dialysers was not performed with the adequate amount of saline and/or that not sufficient time of dialysate rinsing was allowed. The severity of the clinical picture might be also the result of advanced age and comorbid conditions of certain dialysis patients."

March 6, 2002 - Baxter International Inc. reduced CEO Harry Kraemer's 2001 bonus by 60 percent due to as many as 50 hemodialysis patient deaths last year caused by a chemical-related manufacturing problem. Baxter gave Kraemer a bonus of $528,000 in 2001, down from $1.32 million in 2000. Story from Bloomberg Financial News.

The chemical pf-5070, used to test the dialyzers for leaks, didn't evaporate completely during the manufacturing process and entered the patients' bloodstreams when the dialyzers were used for the first time. Here is the Nov. 5, 2001 press release from the Baxter web site on the discovery of this chemical in dialyzers.

January 9, 2002 - Baxter has placed on their web site their statement regarding the Croatian investigation that allegedly found evidence of "perfluoroisobutylene" in the Althane dialyzers recalled last year. Press release from Baxter.

January 8, 2002 - The head of Croatia's toxicological institute said that perfluoroisobutylene, which can be used as a chemical weapon, was detected during an investigation of dialyzers involved in the deaths of 23 Croatian kidney dialysis patients. He also said two women from the Croatian Ministry of Interior suffered serious poisoning during the investigation after inhaling the substance.

Baxter, which manufactured the dialyzers, has questioned the accuracy of the Croatian findings.

"The presence of this gas is likely an artefact of laboratory testing methods that exposed a fluid called PF 5070 to abnormally intense heat," Baxter said in a statement. "PF 5070 is known to produce dangerous by-products, including perfluoroisobutylene, only if exposed to extreme temperatures in excess of 200C". Story from the BBC.

January 3, 2002 - A Swedish prosecutor has dropped his criminal investigation of the Baxter manufacturing plant that produced dialyzers linked to more than 50 deaths worldwide. Story from AP/Yahoo. (link is no longer available)

"Nothing has emerged that indicates that this is anything but a chain of unfortunate circumstances that together led to the tragic deaths that occurred in several different countries," said Prosecutor Tommy Clevenhult.

December 29, 2001 - Here are two recent articles about dialysis equipment/supplies concerns in Croatia:

The Croatian ministry ordered the withdrawal of all Baxter dialysis machines as well as Nissho Nipro Corp. dialysis needles from Croatian dialysis facilities on December 28th. Story from BBC/Financial Times.

On December 29th, a Croatian Health Ministry expert commission for haemodialysis approved the use of all types of haemodialysis machines, including those manufactured by Baxter. The commission also established that haemodialysis needles Safe Touch AVF, manufactured by Nissho Corp, have not been used in Croatia. Story from BBC/Financial Times.

December 5, 2001 - The Croatian government is considering taking legal action against Baxter International for damage to the national health system after the death of 23 dialysis patients earlier this year. Story from Reuters/Yahoo. (link is no longer available)

According to this story, Baxter has offered a compensation of roughly $300,000 per patient to Croatian families, but no agreement has yet been reached.

December 1, 2001 - CityBusiness is reporting that Baxter International Inc. won't sue 3M Co. for producing the pf-5070 fluid used to test Baxter dialyzers and will not hold 3M responsible for deaths that might have been caused by the fluid.

November 28, 2001 - Baxter International announced today that it has agreed to compensate the families of 10 Spanish patients who died after hemodialysis treatments using Baxter dialyzers that have been linked to the deaths of 51 people worldwide. Story from Reuters/Yahoo (3:17 PM update). (link is no longer available)

Each of the 10 families will received 55 million pesetas, or about $289,000, Baxter spokeswoman Sally Benjamin Young said.

Here is the press release from the Baxter web site on the settlement.

November 27, 2001 - Baxter International Inc. said it would lay off 256 workers and close two plants where the company made dialyzers and fibers that are under investigation in more than 50 deaths around the world.

The facilities are in Ronneby, Sweden, and Miami Lakes, Florida. Story from the Chicago Tribune. (link is no longer available)

November 26, 2001 - Baxter International Inc. announced today that it will close the plant in Ronneby, Sweden, that made the hemodialyzers believed to have played a role in the deaths of more than 50 dialysis patients. Baxter also planned to stop production at a plant in Miami Lakes, Florida, that made fibers for the dialyzers. Story from AP/Yahoo. (link is no longer available)

November 24, 2001 - Baxter had taken a $150 million charge to pay for legal costs arising from the deaths of more than 50 patients worldwide as a result of dialyzers that were contaminated with a chemical used in manufacturing. However, Baxter was not expecting to be sued by the Spanish government (for $250-280 million) when the provision was made. Story from AFX News/European Investor. (link is no longer available)

Baxter International completed its acquisition of Althin Medical A.B., on March 7, 2000 for approximately $130 million. Press release from Baxter.

The Nov. 21 issue of the FDA Enforcement Report contains the recall notice for these Baxter/Althin dialyzers. That portion of the report is listed here:

RECALLS AND FIELD CORRECTIONS: DEVICES CLASS I

PRODUCT
Melt-spun Cellulose Diacetate Hemodialyzers; a single use sterile device for hemodialysis of patients with acute or chronic renal failure; 12 units per case; A-Series Dialyzers made from Altra Nova Fibers, AF-Series Dialyzers made from Altra Flux Fiber and AX-Series Dialyzers made from Altrex Fiber;
a) Recall # Z-0257-2;
b) Recall # Z-0258-2;
c) Recall # Z-0259-2;
d) Recall # Z-0260-2;
e) Recall # Z-0261-2;
f) Recall # Z-0262-2;
g) Recall # Z-0263-2;
h) Recall # Z-0264-2;
i) Recall # Z-0265-2.

CODE
a) A-11 Dialyzer, product code 237011, 237511, 237311;
b) A-15 Dialyzer, product code 237015, 237515, 237315;
c) A-18 Dialyzer, product code 237018, 237518, 237318;
d) A-22 Dialyzer, product code 237022;
e) AF-150 Dialyzer, product code 238015, 238515;
f) AF-180 Dialyzer, product code 238018, 238518;
g) AF-220 Dialyzer, product code 238022, 238522;
h) AX-15 Dialyzer, product code 239015;
i) AX-22 Dialyzer, product code 239022, 239522.

All lots of the A-Series Dialyzers, AF-Series Dialyzers and AX-Series Dialyzers. Baxter also recalled the following lots of cellulose acetate fibers as a precautionary measure: catalog numbers 100-416, 100-923, 700-098, 700-150.

1) Altra Nova, lots 990924P1D1 thru 011019P4A;
2) Altra Flux, lots 990904P6A1 thru 011017P7A;
3) Altrex, lots 990929P6A1 thru 000203P6A1.

RECALLING FIRM/ MANFACTURER
Recalling Firm: Baxter Healthcare Corp. Round Lake, IL, by telephone on 10/18/01 and recall letters dated 10/18/01.
Manufacturer: Baxter/Althin Medical AB Ronneby, SW.

Firm initiated recall is ongoing.

REASON
Hemodialyzers associated with deaths in Croatia and Spain.

PRODUCT
2,435,306 dialyzers.

DISTRIBUTION
Nationwide and international. The AX-series dialyzers were not distributed in the United States.

November 22, 2001 - Spain's Health Minister Celia Villalobos said on Thursday that the Spanish government will claim up to $280 million from Baxter in compensation for the deaths of eleven dialysis patients. (link is no longer available)

November 21, 2001 - Celia Villalobos, Spain's Health Minister, said today that her department would seek legal action against Baxter International in the United States in connection with the deaths of 11 Spanish kidney patients who used Baxter's dialyzers. (link is no longer available)

The judge in Valencia, Spain who is investigating the deaths of six dialysis patients who died in August, has called on three more directors from Baxter to give evidence. Story from Financial Times that was abstracted from El Pais. (link is no longer available)

November 15, 2001 - Baxter spokeswoman Lisa Scheff commented on the Swedish criminal investigation into dialyzer production. "We are aware of the investigation and we're confident that we did nothing to warrant criminal charges," she said. Story from Reuters. (link is no longer available)

November 14, 2001 - Sweden has begun a criminal investigation of the Baxter manufacturing facility that made the dialyzers suspected in the deaths of more than 50 dialysis patients. Story from the Associated Press. (link is no longer available)

The firm of Kenneth B. Moll & Associates Ltd., based in Chicago, said it has filed suit against Baxter International Inc. on behalf of patients with kidney diseases who were treated with dialyzers that may have been contaminated with the chemical pf-5070.

In the United States, a judge must rule on whether cases can be consolidated and receive class-action status. If certified, Moll believes the class may include up to 900,000 plaintiffs[/b], according to this news story from Reuters. (link is no longer available)

This number, apparently, is based on the fact that Baxter manufactured 3 million dialyzers in 2000 and that the law firm estimates 30%, or about 900,000, were part of Baxter's recall. This estimate appears to demonstrate that the parties involved in this lawsuit do not yet understand that a hemodialysis patient uses between 15 and 156 dialyzers per year (depending on reuse practices) and that there are only 1 million dialysis patients worldwide. The Reuters article also points out that fewer than 10% of the recalled series A and AF dialyzers were exposed to the pf-5070 fluid. In addition, Baxter changed to a new kind of equipment to help evaporate the pf-5070 solution only this last summer. (In my opinion, the law firm has overestimated the number of plantiffs by 100-1000 times.)

3M Sued, Too - This news story from Bloomberg states that Kenneth B. Moll & Associates are suing both Baxter and 3M. 3M manufactures the pf-5070 solution that was used by Baxter to re-test dialyzers that did not pass the initial fiber integrity (leak) test.

This story from Reuters (link is no longer available) reports that the government of the Spanish region of Valencia has asked hospitals to withdraw "infusion tubes" made by Baxter. The decision followed the discovery in a hospital in the region on Monday that the rubber on batch of infusion tubes had an unusual appearance. (I believe "infusion tubes" are IV administration sets.)

Fresenius Medical Care (FMC) has placed a message that can only be accessed from their home page which states that perfluorocarbon-based fluids are not used in the manufacture of their Polysulfone® dialyzers.

November 13, 2001 - Attorney Kenneth Moll, who will file a class action suit against Baxter today, said he expected very high compensations for the dialyzer-related deaths and estimated they would range from US $2 million to $5 million dollars per case. Story from BBC/FT and Croatian news agency HINA.

November 10, 2001 - On November 9, a Chicago attorney filed the first lawsuit against Baxter over connections between its dialyzers and 53 recent deaths world-wide. Story from Financial Times.

Financial Times also reports that the Spanish health ministry has drawn the conclusion that the deaths of 11 dialysis patients who died in Spain last summer were the result of "an anomalous reaction" caused by the existence of "harmful substances" in dialyzers supplied by Baxter.

November 9, 2001 - Gambro has issued a press release regarding its dialyzers and the use of pf-5070 in their manufacturing. Gambro has experienced no litigation relating to its dialyzers and its production of dialyzers continues unabated. (link is no longer available)

NOTE CLARIFICATION:

A Financial Times (FT) article reports today that Gambro has been using the same "cleaning fluid" as Baxter.[/b] (link is no longer available)

Clarification to FT article: - Gambro reports that it has used the pf-5070 fluid for over five years with no problem. Gambro reports this fluid has only been used in 0.3% of its production. As a precautionary measure, the pf-5070 fluid is no longer being used. Otherwise, dialyzer production continues as normal. RenalWEB regrets any confusion that may have arisen on this issue.

"Dialysis products treat a patient population that needs dialysis to live. As a result of that, legal settlements and court judgments are less punitive than cases involving the entire public.

The reason for that, says David Lothson, analyst at UBS Warburg, is that few companies are in businesses such as haemodialysis and courts do not want to drive people away from essential treatments.

"The courts tend to not excoriate these companies if they feel they have acted in good faith and done their best," Mr Lothson says."

Unsurprisingly, here come the class-action lawyers. (link is no longer available)

November 8, 2001 - According this article in the New York Post, J.P. Morgan Securities is anticipating that there could be as many as 650 patients that were treated with contaminated Baxter dialyzers. Analyst Michael Weinstein and his colleagues at J.P. Morgan are calculating that the number of deaths could total 200 patients or more. (link is no longer available)

"Croats welcome Baxter's admission its product might have played role in kidney patients' deaths" - article from AP Worldstream/Big Charts.

The Chicago Tribune has published an article about the chemical known as Performance Fluid 5070 and its use by Baxter in dialyzer manufacturing. (link is no longer available)

The Health Ministry of Spain announced today it had found "a clear association" between the deaths of 11 kidney patients in Spain and the use of Baxter's Althane A-18 dialyzers. (link is no longer available)

The Food and Drug Administration (FDA) has posted a page on its web site about its activities in the Baxter dialyzer recall.

November 7, 2001 - David Griesing, a columnist for the Chicago Tribune, writes today about Baxter's management of the crisis created by the contaminated dialyzers and the resulting patient deaths. (link is no longer available)

According to the column, Harry Kraemer, Jr., Baxter's chief executive, accepted Baxter's responsibility in the incidents when he discovered two key findings. The first was that the Swedish factory early last summer had begun using a new kind of equipment to help evaporate the 3M solvent--which was used to test dialyzers, but was not intended to be introduced into patients' blood. Then, last Friday, he was told that rabbits injected with a solution containing the solvent experienced the same symptons that had led to death in human patients.

This article from The Guardian (UK) states that up to 90 patient deaths are now under investigation as being possibly related to chemical contamination of Baxter's Series A and AF dialyzers. There is an unconfirmed report of 41 deaths in India that may be related to the case. (link is no longer available)

November 6, 2001 - 3M Corporation of Minnesota manufactures pf-5070 (a perfluorohydrocarbon), the chemical that is suspected of having a role in the patient deaths associated with Baxter Series A and AF dialyzers. This article from a Minnesota paper discusses the usual applications for pf-5070 in manufacturing processes. (link is no longer available)

Interestingly, perfluorohydrocarbon emulsions are being used as a component of non-hemoglobin artificial blood, according to this web page from the American Red Cross of Northern California. (link is no longer available)

"A wave of litigation pressure appears to be mounting against Baxter International Inc. in connection with the deaths of more than 50 kidney dialysis patients worldwide", according to this article from Reuters. (link is no longer available)

Spain's health minister, Celia Villalobos, said that her department was preparing a possible lawsuit against Baxter. In Croatia, lawyers from the U.S. have published advertisements in local newspapers, asking families of the deceased patients to contact them for legal representation in U.S. courts.

Baxter has placed on its web site copies of letters dated November 5 that have been sent to both patients and customers.

There are now 53 dialysis patient deaths being investigated that may have a connection to a chemical used in the manufacturing of the Baxter's Series A and AF dialyzers. Here is the story from the Chicago Tribune for Nov. 6. (link is no longer available)

A reporter from the Associated Press filed this report yesterday at 8:02 PM. It states that the 3M company, the manufacturer of the chemical pf-5070, wasn't aware that Baxter used the product for leak testing until about 10 days ago. In addition, an FDA official is quoted saying, "There are safe uses for this product but this isn't one of them." (link is no longer available)

This is Update #8 (4:20 PM, Nov. 5) on this story from Bloomberg Financial News.

Here is the story from the New York Times on-line issue for Nov. 6. (link is no longer available)

The Baxter stock price fell $2.67 yesterday, losing 5.45 percent of its value.

November 5, 2001 (3:17 PM) - This news story from the Associated Press/Yahoo says that a chemical solution known as 5070, which is used to test for leaks, somehow was not fully removed from all dialyzers. (link is no longer available)

The article also states that the Ronneby, Sweden facility and another Baxter plant in Miami Lakes, Florida, which makes fibers used in the dialyzers, have been idled. Baxter officials said they have not yet decided whether to close them for good.

Lee Henderson, a medical consultant for Baxter International Inc., speaks on a 28-minute teleconference about the investigation into whether the company's dialyzers may be linked to 51 deaths. Click here for the link to listen to the telconference posted by Bloomberg Financial.

Baxter said it was facing the worst crisis of its 80-year history after admitting today that manufacturing problems with its dialyzers could have caused the deaths of dozens of dialysis patients. Story from Financial Times (London).

Baxter said today that preliminary tests show a processing fluid (a perfluorohydrocarbon) used in its manufacturing operations in Sweden may have played a role in several recent dialysis patient deaths.

Here is the press release from the Baxter web site.

Baxter also said it is permanently ceasing manufacturing of its Series A and AF dialyzers. Baxter expects to take a fourth-quarter after-tax charge of approximately $100-$150 million to cover the cost of discontinuing this product line and other related costs.

Previous news items on this story are posted here.