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Baxter and Flamel Technologies Announce Collaboration to

Formulate Longer Acting Forms of Blood Clotting Factors

DEERFIELD, Ill and LYON, France, July 13, 2009 Baxter International Inc. (NYSE: BAX) and

Flamel Technologies, SA (NASDAQ: FLML) announced today that they have entered into agreement to

formulate controlled release applications of blood clotting factor replacement therapies using

Flamel s Medusa Technology. The work between the two companies will focus on developing

longer-acting formulations with the objective of reducing the frequency of infusions required to

treat blood clotting disorders in hemophilia. Pursuant to the agreement between the two companies,

Flamel will receive technology access fees totaling 2.5 million. Baxter will pay all development

costs for the program and have an exclusive right to negotiate a license to the Medusa platform.

We continue to develop and advance novel therapies that improve patient convenience by

decreasing the frequency of infusions to help people living with hemophilia lead a more normal

life, said Hartmut J. Ehrlich, MD, vice president of global research and development in BioScience

at Baxter. We look forward to this partnership using Flamel s Medusa Technology as a novel

approach to address this goal.

We are pleased to be working with Baxter to develop longer-acting formulations of factor

replacement therapies for hemophilia patients, said Stephen H. Willard, Flamel s chief executive

officer. Baxter is an ideal partner for these molecules due to its extensive expertise in the

field. Our work with Baxter allows us to leverage our expertise in drug delivery to create

solutions for the administration of intravenous formulations of therapeutic proteins. This program

has the potential to develop more convenient solutions for people living with hemophilia, their

families, and physicians.

There are two types of hemophilia: hemophilia A (sometimes called classical hemophilia) and

hemophilia B (sometimes called Christmas disease). Both are caused by a low level or absence of one

of the proteins in the blood (called factors) that control bleeding. Hemophilia A is caused by a

deficiency of factor VIII, and hemophilia B is caused by a deficiency of factor IX.

There is no difference between the two types of hemophilia, except that hemophilia B is about

five times less common than hemophilia A. According to the World Federation of Hemophilia, more

than 400,000 people in the world have hemophilia.

The Medusa platform uses biodegradable polymers to adsorb therapeutic large molecules through

hydrophobic interaction, with no loss of bioactivity, for controlled release applications. The

Medusa polymer is amphiphilic and spontaneously forms stable nanoparticles in water. They are

robust over a wide range of pH values and can be stored as either stable liquid or stable dry forms

that can be easily reconstituted in water.

About Flamel Technologies

Flamel Technologies, S.A. is a biopharmaceutical company principally engaged in the

development of two unique polymer-based delivery technologies for medical applications. Flamel s

Medusa technology is designed to deliver controlled-release formulations of therapeutic proteins

and peptides and other molecules, without reduction in bioactivity. Micropump is a controlled

release and taste-masking technology for the oral administration of small molecule drugs; it is the

intellectual platform licensed by GlaxoSmithKline for COREG CR .

Baxter International Inc., through its subsidiaries, develops, manufactures and markets

products that save and sustain the lives of people with hemophilia, immune disorders, infectious

diseases, kidney disease, trauma, and other chronic and acute medical conditions. As a global,

diversified healthcare company, Baxter applies a unique combination of expertise in medical

devices, pharmaceuticals and biotechnology to create products that advance patient care worldwide.

This release includes forward-looking statements concerning expectations related to agreements

entered into between Baxter International Inc. and Flamel Technologies, S.A. and Flamel s Medusa

Technology. The statements are based on assumptions about many important factors, including the

following, which could cause actual results to differ materially from those in the forward-looking

statements: risks that products in the development stage may not achieve scientific objectives or

milestones; future actions of regulatory bodies and other governmental authorities, including the

FDA and foreign counterparts; product quality or patient safety concerns; product development

risks; the impact of competitive products and pricing; any impact of the commercial and credit

environment on Baxter, Flamel or any of their customers and other risks identified in Baxter most

recent filing on Form 10-K and other Securities and Exchange Commission filings, all of which are

available on Baxter s website, and in Flamel s most recent Securities and Exchange Commission

filing on Form 20-F. Neither Baxter nor Flamel undertakes to update its forward-looking statements.