UPDATE 3-Baxter first-quarter net rises; sales drop

* Q1 net 83 cts/share vs. company forecast of 80-82 cts

* Q1 sales $2.8 bln, down 2 percent from year earlier

* Sees full year EPS of $3.72 to $3.78

* Shares rise more than 5 pct on NYSE
(Adds CEO and analyst comments, updates share movement)

By Debra Sherman

CHICAGO, April 16 (Reuters) - Baxter International Inc
(BAX.N) said on Thursday quarterly profit rose 20 percent on
improved margins and continued strong demand for its blood
therapy products.

The company, which also makes intravenous drug pumps and
renal products, said it has seen "no meaningful impact" from the
tough macroeconomic environment.

Baxter's results, said Chief Executive Robert Parkinson,
reflect "the medically necessary nature of our products."
However, he added, "nobody is immune" to the economy.

Shares rose $2.65, or more than 5 percent, to $51.90 on
Thursday morning on the New York Stock Exchange in an otherwise
flat broad market.

Baxter said first-quarter net income increased to $516
million, or 83 cents a share, from $429 million, or 67 cents a
share, a year earlier.

Excluding special items, the Deerfield, Illinois-based
company earned 83 cents a share.

Analysts on average expected 81 cents per share, according
to Reuters Estimates.

First-quarter worldwide sales fell 2 percent from a year
ago to $2.8 billion. Excluding the negative impact of foreign
currency, worldwide sales increased 6 percent.

"Results were phenomenal, really, in the face of this
economy. There's nothing not to like," said Edward Jones analyst
Aaron Vaughn.

Looking ahead to the second quarter, Baxter said it expects
sales growth, excluding the impact of foreign currency, of 7
percent. It forecast second-quarter earnings per diluted share
of 93 to 95 cents, before items.

For the full year, Baxter expects sales growth, excluding
the impact of foreign currency, of 7 percent. The company sees
earnings per diluted share of $3.72 to $3.78, before items, and
continues to expect cash flow from operations to total more
than $2.6 billion.

Parkinson said the plasma protein market, part of Baxter's
Bioscience business, is healthy and he sees opportunity for
price increases during the coming year.

That comment, said Vaughn, should alleviate investor
anxiety over the state of the plasma protein market.
(Reporting by Debra Sherman; Editing by Lisa Von Ahn, Dave
Zimmerman and Matthew Lewis)