SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE

SECURITIES EXCHANGE ACT OF 1934

For the quarter ended March 31, 2003

Commission File Number 1-6926

730 Central Avenue, Murray Hill, New Jersey 07974

(Address of principal executive offices)

The accompanying notes to condensed consolidated financial statements are an integral part of these statements.

The accompanying notes to condensed consolidated financial statements are an integral part of these statements.

The accompanying notes to condensed consolidated financial statements are an integral part of these statements.

The accompanying notes to condensed consolidated financial statements are an integral part of these statements.

The financial statements contained in this filing have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission and have not been audited. However, C. R. Bard, Inc. ("Bard" or the "company") believes that it has included all adjustments to the interim financial statements, consisting only of normal recurring adjustments, that are necessary to present fairly Bard's financial condition and results of operations at the dates and for the periods presented. The results of operations for the interim periods are not necessarily indicative of results of operations for a full year. These consolidated financial statements should be read in conjunction with the Consolidated Financial Statements and Notes to Consolidated Financial Statements as filed by the company in its 2002 Annual Report on Form 10-K.

Consolidation - The consolidated financial statements include the accounts of the company and its majority-owned subsidiaries. All significant intercompany accounts and transactions are eliminated in consolidation.

Use of Estimates in the Preparation of Financial Statements - The preparation of these financial statements in conformity with accounting principles generally accepted in the United States of America requires the company to make estimates and judgments that affect reported amounts of assets, liabilities, revenues and expenses, and the related disclosure of contingent assets and liabilities at the date of the financial statements. The company evaluates these estimates and judgments on an ongoing basis and bases its estimates on historical experience, current conditions and various other assumptions that are believed to be reasonable under the circumstances. The results of these estimates form the basis for making judgments about the carrying values of assets and liabilities as well as identifying and assessing the accounting treatment with respect to commitments and contingencies. Actual results may differ from these estimates under different assumptions or conditions.

Research And Development - Research and development costs are expensed when incurred.

Stock-Based Compensation - The company maintains various stock-based employee and director compensation plans, which are described more fully in Note 9 Shareholders' Investment of the Notes to Consolidated Financial Statements as filed by the company in its 2002 Annual Report on Form 10-K. The company accounts for those plans under the recognition and measurement principles of Accounting Principles Board Opinion No. 25, "Accounting for Stock Issued to Employees" ("APB 25") and related interpretations. No stock-based employee compensation cost is reflected in net income for employee option grants, as all options granted under those plans had an exercise price equal to the market value of the underlying common stock on the date of grant. Additionally, in accordance with APB 25 and related interpretations, the company recognizes no compensation expense for the discount associated with the 1998 Employee Stock Purchase Plan of C. R. Bard, Inc. ("ESPP"). The following table illustrates the effec t on net income and earnings per share if the company had applied the fair value recognition provisions of FAS No. 123 "Accounting for Stock-Based Compensation," to stock-based employee compensation.

During the first quarter of 2003, the company initiated a salesperson incentive program. This program provides for awards of restricted stock units or the matching of deferred bonus and commissions with restricted stock units. Awards and matches are based upon salesperson performance. Awards of approximately 127,300 restricted stock units were made under this program during the first quarter of 2003. The company recorded unearned compensation expense in shareholders' investment based on the company's stock price of $58.73 at the time of grant and will recognize expense on a straight-line basis over the seven-year vesting period.

On April 16, 2003, shareholders approved the 2003 Long Term Incentive Plan of C. R. Bard, Inc. (the "2003 Plan") that replaces the company's 1993 Long Term Incentive Plan, as amended and restated, under which no further awards may be made after April 20, 2003. The total number of shares that may be issued under the 2003 Plan is 3,000,000. Awards under the 2003 Plan shall be in the form of stock options, stock appreciation rights, limited stock appreciation rights, restricted stock, unrestricted stock and other stock-based awards.

Earnings Per Share - "Basic earnings per share" represents net income divided by the weighted average shares outstanding. "Diluted earnings per share" represents net income divided by the weighted average shares outstanding adjusted for the incremental dilution of outstanding employee stock options and awards. Unless indicated otherwise, per share amounts are calculated on a diluted basis. A reconciliation of weighted average common shares outstanding to weighted average common shares outstanding assuming dilution follows:

Restructuring Charges - Based upon an analysis of divisional and manufacturing operations, the company committed to and approved a restructuring plan for certain divisions and manufacturing facilities. This plan resulted in a pretax restructuring charge of $9,100,000 in the first quarter of 2002 and a pretax restructuring charge of $24,600,000 in the third quarter of 2002. These charges were recorded in other (income) expense, net and the associated reserves are recorded in accrued expenses. These restructuring charges represent the elimination of approximately 617 employee positions and the closure of three manufacturing and two administrative facilities. The following table sets forth an analysis of restructuring provisions through March 31, 2003:

Through March 31, 2003, the company has eliminated 159 positions. In accordance with EITF 94-3, the company expects the remaining cash expenditures related to workforce reductions, lease terminations and facility closing costs, to be paid out no later than one year from their accrual. The above restructuring charges are based on estimates including estimated proceeds from asset dispositions and sublease revenue.

Goodwill and Intangible Assets - The balances of goodwill and intangible assets are as follows:

Goodwill increased by $5.1 million for the acquisition of the assets of a small brachytherapy seed distributor, Prostate Services of America and $3.0 million for the payment of a contingent milestone related to a prior year's acquisition. The impact of translation increased the balance of goodwill by $4.0 million. Annual forecasted amortization expense for the years 2003 through 2008 is as follows:

Short-Term Borrowings and Long-Term Debt - The company maintains a commercial paper program and committed credit facilities that support the company's commercial paper program. The committed facilities can also be used for other corporate purposes. In 2000, the company replaced its maturing $300.0 million committed credit facility with a $200.0 million five-year committed credit facility that matures in May of 2005 and a $100.0 million 364-day committed credit facility that next matures in May of 2003. The company anticipates renewing its $100.0 million 364-day committed credit facility in the second quarter of 2003 on similar terms. These facilities carry variable market rates of interest and require annual commitment fees. There were no commercial paper borrowings at either March 31, 2003 or December 31, 2002.

In December 1996, the company issued $150.0 million of 6.70 percent notes due 2026. These notes may be redeemed at the option of the note holders on December 1, 2006, at a redemption price equal to the

principal amount. The market value of these notes approximates $157.9 million at March 31, 2003, assuming the notes are held to 2026. Cash payments on interest equal $3.1 million and $3.2 million for the three-month periods ended March 31, 2003 and March 31, 2002, respectively. Certain of the company's debt agreements contain customary representations, warranties and default provisions as well as restrictions that, among other things, require the maintenance of a minimum ratio of operating cash flow to interest expense and limit the amount of debt that the company may have outstanding. As of March 31, 2003, the company was in compliance with all such covenants.

Derivative Instruments - The company enters into readily marketable traded forward contracts and options with financial institutions to help reduce the exposure to fluctuations between certain currencies. These contracts create limited earnings volatility because gains and losses associated with exchange rate movements are generally offset by movements in the underlying hedged item. The company does not enter into these arrangements for trading or speculation purposes.

A roll forward of the company's derivative financial instruments for the three-month period ended March 31, 2003 is as follows:

In April of 2003, the company entered into additional Euro option-based instruments for a notional amount of approximately $60,000,000. At March 31, 2003 the net fair value of option-based products and the incremental adjustment to fair market value of forward currency agreements are recorded in Other Current Assets. During the first quarter of 2003, the company reclassified from Accumulated Other Comprehensive Income a net loss of $100,000 to Other (Income) Expense, net.

Legal - The company is subject to various legal proceedings and claims, including claims of alleged personal injuries as a result of exposure to natural rubber latex gloves distributed by the company and other product liability matters, environmental matters and disputes on agreements which arise in the ordinary course of business. In addition, the company operates in an industry susceptible to significant patent legal claims. At any given time, the company generally is involved as both a plaintiff and defendant in a number of patent infringement actions. If infringement of a third party's patent were to be determined against the company, the company may be required to make significant royalty or other payments or may be subject to an injunction or other limitation on its ability to manufacture or distribute

one or more products. If a company patent were to be determined to be invalid or unenforceable, the company may be required to reduce the value of the patent on the company's balance sheet and to record a corresponding noncash charge, which could be significant in amount.

Product Warranty - The majority of the company's products are intended for single use; and therefore, the company requires limited product warranty accruals. Certain of the company's products carry limited warranties that in general do not exceed one year from sale. The company accrues estimated product warranty costs at the time of sale and any additional amounts are recorded when such costs are probable and can be reasonably estimated.

Segment Information - The company's management considers its business to be a single segment entity - the manufacture and sale of medical devices. The company's products generally share similar distribution channels and customers. The company designs, manufactures, packages, distributes and sells medical, surgical, diagnostic and patient care devices that are purchased by hospitals, physicians and nursing homes, many of which are used once and discarded. The company's chief operating decision makers evaluate their various global product portfolios on a net sales basis. The company's chief operating decision makers generally evaluate profitability and associated investment on an enterprise-wide basis due to shared infrastructures. The following table represents net sales by geographic region based on the location of the external customer.

The following table represents net sales by disease state management.

Bard reported first quarter 2003 consolidated net sales of $335.9 million; an increase of 11% over the first quarter 2002 consolidated net sales of $301.9 million.

The geographic breakdown by the location of the external customer is presented below:

Consolidated net sales were affected by price changes that had the effect of increasing consolidated net sales by 0.4% for the quarter ended March 31, 2003 and had the effect of reducing consolidated net sales by 0.1% for the quarter ended March 31, 2002 as compared to the prior year respective quarters. Consolidated net sales were also affected by the impact of exchange rate fluctuations. Exchange rate fluctuations had the effect of increasing consolidated net sales by 3.0% for the first quarter ended March 31, 2003 and decreasing consolidated net sales by 0.8% for the first quarter ended March 31, 2002. The primary exchange rate movement that impacts net sales is the movement of the Euro compared to the United States dollar. The impact of exchange rate movements on net sales is not indicative of the impact on net earnings due to the offsetting impact of exchange rate movements on operating costs and expenses, costs incurred in other currencies and the company's hedging activities.

Bard's first quarter net sales for the three months ended March 31, 2003 in the United States of $242.8 million increased 9% over the first quarter net sales for the three months ended March 31, 2002 in the United States of $223.3 million. Bard's international net sales of $93.1 million for the three months ended March 31, 2003 increased 18% over the three months ended March 31, 2002 international net sales of $78.6 million. Adjusting for exchange rate fluctuations, international net sales increased 7% on a constant currency basis for the first quarter ended March 31, 2003.

Presented below is a discussion of consolidated net sales by disease state for the first quarter ended March 31, 2003 and March 31, 2002.

Vascular Products - Bard markets a wide range of products for the peripheral vascular market including interventional radiology products, electrophysiology products and graft products. Consolidated net sales of vascular products increased 13% for the quarter ended March 31, 2003, as compared to the quarter ended March 31, 2002. United States net sales of vascular products experienced 15% growth for the first quarter ended March 31, 2003 while international net sales increased 10%. The vascular group is the company's most global business, with international net sales comprising 47% of total vascular revenues.

Interventional radiology products comprised 47% of the vascular products group in the first quarter ended March 31, 2003, and net sales of these products increased 16% on a constant currency basis, an increase of 24% on a reported basis. The company saw strong performance from its PTA catheter products, which grew almost 60% on a constant currency basis, 69% on a reported basis. The company's self-expanding stent line also had notable performance, growing 27% for the first quarter on a constant currency basis, 37% on a reported basis.

Net sales of electrophysiology products declined 1% on a constant currency basis, an increase of 7% on a reported basis for the first quarter ended March 31, 2003 compared to the first quarter ended March 31, 2002. United States net sales of electrophysiology products grew 6% for the three months ended March 31, 2003, while international net sales declined 6% on a constant currency basis, and increased 8% on a reported basis, compared to the first quarter ended March 31, 2002. The company's electrophysiology business continues to recover slowly in Europe.

Graft product sales declined 2% on a constant currency basis and increased 3% on a reported basis, for the first quarter ended March 31, 2003. The company had a strong showing in the United States with 6% growth but sales performance was weak internationally.

Urological Products - Bard markets a wide range of products for the urological market including basic drainage products, continence products and urological specialty products. Consolidated net sales of urological products were $109.3 million, an increase of 8% on a constant currency basis, 10% on a reported basis, for the first quarter ended March 31, 2003 as compared to the first quarter ended March 31, 2002. Urological products comprised approximately one third of total revenues for the first quarter ended March 31, 2003. United States net sales represented 74% of total urological sales for the three months ended March 31, 2003 and grew 4% for the three months ended March 31, 2003 as compared to the three months ended March 31, 2002. International net sales of urological products for the three months ended March 31, 2003 increased 21% on a constant currency basis, 33% on a reported basis, compared to the three months ended March 31, 2002.

Net sales of basic drainage products increased 8% on a constant currency basis, 10% on a reported basis, for the three months ended March 31, 2003 as compared to the three months ended March 31, 2002. The sale of infection control drainage products fueled this growth. Of particular note is a building momentum of conversions to infection control products in the Japanese market.

Net sales of urological specialties, which includes Brachytheraphy products and services, grew 7% on a constant currency basis, 9% on a reported basis, for the three months ended March 31, 2003 as compared to the three months ended March 31, 2002. Net sales of brachytherapy products grew 9% on a constant currency basis, 10% on a reported basis, for the three months ended March 31, 2003 as compared to the three months ended March 31, 2002. The company believes its brachytheraphy growth is favorable to the overall brachytheraphy market. Net sales of brachytheraphy products were favorably impacted by the acquisition of the assets of a small seed distributor company, Prostate Services of America.

Net sales of continence products grew 10% on a constant currency basis, 14% on a reported basis, for the first quarter of 2003 as compared to the prior-year period, and accounted for 13% of total urology sales in the first quarter of 2003. The company's surgical incontinence product line continues to provide the momentum in this category growing 45% on a constant currency basis and on a reported basis, for the three months ended March 31, 2003 as compared t