Shares of Baxter International plunged after the company cut its full-year profit outlook on slower-than-expected sales of plasma-based drugs and charges related to health care reform.

In 2010, the company expects profit between $3.92 and $4 per share, down from a previous range of $4.20 to $4.28 per share. It cited increased Medicaid rebates included in the health care overhaul as well as greater competition in the market for plasma-based therapies used to treat hemophilia, immune disorders and other diseases.

“We, in retrospect, were clearly overly optimistic about the short-term market growth, our ability to retain market share and the near-term impact on the market of deploying additional sales resources,” said Chief Executive Robert Parkinson.

Shares of the Deerfield, Ill.-based fell $8.68, or 15 percent, to $50.27 in afternoon trading.

The sell-off came despite a 2 percent rise in first-quarter profit on a boost of bioscience and kidney care products.

Baxter earned $525 million, or 86 cents per share, in the quarter ended in March, up from $516 million, or 83 cents per share, a year prior.

Sales rose 11 percent to $3.14 billion from $2.82 billion. Excluding the impact of foreign currency, sales increased 5 percent.

Despite those gains, analysts focused on plasma and antibody drugs, sales of which fell 4 percent and 11 percent, respectively, in the U.S. Parkinson told analysts the market for these products has gone from under-penetrated to highly competitive in the past two years.

“The market is growing much slower than what we had anticipated,” Parkinson said. “As I acknowledged on our last call, we’ve lost some market share.”

Parkinson said he was optimistic about growth for plasma sales in the long term as the company expands to developing markets.

Excluding items, the company says it earned 93 cents per share, matching Wall Street expectations. The company posted a charge of $39 million, or 7 cents per share, related to health care reform.

Management estimated health reform-related costs would total $80 million, or 10 cents per share, for all of 2010.

During the second quarter, the company expects profit between 90 cents and 93 cents per share.

Analysts, on average, expect second-quarter profit of $1.06 per share and full-year profit of $4.24 per share.