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Hospital Supply Giant Scraps Plans For Syrian Plant

June 10, 1991

CHICAGO (AP) _ Baxter International Inc. announced Monday it is abandoning plans to built a plant in Syria because of controversy over the leading hospital supply company’s dealings in the Middle East.

But Baxter continued to deny allegations that the 1988 sale of its Israeli operation was designed to remove Baxter from an Arab blacklist of companies dealing with Israel.

Federal officials are investigating whether Baxter sold the Israeli plant to clear the way for the Syrian operation, which would have been in violation of a U.S. law against cooperating with the Arab boycott.

The New York-based American Jewish Congress, among several Jewish organizations that had criticized the proposed Syrian deal, praised Baxter’s reversal but said it does not clear the company of the charges under investigation.

Barbara Lazarus, spokesman for the U.S. attorney’s office, declined to comment on Baxter’s move and would not discuss the investigation. The suburban Deerfield-based company has not been charged with any crime.

Baxter spokesman Les Jacobson said abandoning the Syrian plant is ″completely separate and distinct from the investigation under way. It was a result of controversy generated by some groups and members of Congress.″

″It’s important for us as a health care company to be perceived as doing the right thing,″ Jacobson said. ″I hope it is an action people can see as taking a step in the right direction.″

Baxter agreed in 1990 to build a plant to manufacture intravenous solutions in Syria, although that country remains on the U.S. government’s list of countries harboring terrorists.

The company was working on the deal with the Syrian military, although no construction or investments had begun, Jacobson said.

″We had only one intention in agreeing to build in Syria,″ said Baxter Chairman Vernon R. Loucks Jr. ″We intended to bring Baxter’s life-saving health-care products more directly to the people of the Arab world.″

″The volatile situation throughout the Middle East and controversy surrounding Syria in particular now lead us to change our plan,″ Loucks said.

Jacobson said Baxter has no plans to build an alternative plant in the Middle East.

Loucks noted that Baxter products will still be available in the Middle East through distributors, and that Israel continues to be the company’s largest trading partner in the region.

Loucks, commenting on the federal probe, said Baxter ″has done nothing wrong.″

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