In the race for a blood substitute, Baxter International Inc. isthe first to initiate tests in victims of trauma and shock. But theultimate winner will probably not emerge right away, oneanalyst who covers the company said Wednesday in reaction tothe announcement of the new safety trial.

The Deerfield, Ill., company (NYSE:BAX) is beginning hospitaltests of its hemoglobin-based blood substitute under aninvestigational new drug application (IND) filed with FDA. Theproduct, DCLHb, already has been tested in healthy volunteers.

Baxter's closest competitor, Somatogen Inc. (NASDAQ:SMTG) ofBoulder, Colo., announced last month that it was extendingPhase I-B trials for its recombinant human hemoglobinproduct, rHb1.1 to gather more data.

"It appears that Baxter is a little bit ahead of them," said MarieConway, an analyst who follows Baxter at NatWest Securities inNew York. "It's a plus for Baxter; they're making progress. Idon't expect a product out until the mid-1990s. If a productcomes out around 1995, it will help in the later half of theirdecade with earnings growth."

Although Baxter has a product in the pipeline that hasblockbuster potential, Conway said, many steps remain andsuccess is not ensured.

Baxter's blood substitute, from human hemoglobin extractedfrom outdated or indate units of blood, is free of cellularantigens, allowing the solution to be administered immediatelyto trauma victims of any blood type.

Baxter's hemoglobin solution is produced by a patentedchemical cross-linking process designed to stabilize thesolution, enabling it to circulate in the body for 24 to 48 hoursand to deliver oxygen to tissues in a manner similar to freshblood. The stabilization also permits the hemoglobin towithstand a patented viral-inactivation process, effectiveagainst HIV and hepatitis.

The potential worldwide market for oxygen-carrying solutionsin multiple therapeutic applications is estimated to exceed $2billion by the year 2000.

-- Nancy Garcia Associate Editor

(c) 1997 American Health Consultants. All rights reserved.

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