Roche aims for 400 million Tamiflu doses by end 2006

Swiss drug maker Roche is boosting output of its flu drug Tamiflu by a third in order to meet increased demand from governments building stockpiles to deal with a potential pandemic triggered by bird flu.

The Basel-based group said on Thursday it would lift production capacity by an additional 100 million treatments to a total of 400 million treatments by the end of the year, after striking deals with external producers.

Roche said it expects 1.1 billion to 1.2 billion Swiss francs ($921 million) in sales of the drug to governments this year, excluding its sales as a treatment for regular influenza.

The production increase is designed to meet government orders for millions of doses of the drug, which has been recommended by experts as one of the most effective ways of treating humans who may become infected with evolving forms of the H5N1 strain of bird flu.

Some scientists have questioned how well Tamiflu will perform in countering new strains of the disease and, in a bid to answer these uncertainties, Roche said it was conducting a range of studies to examine the drug's best use.

"Roche has in place a number of research initiatives to answer questions raised on the use of Tamiflu against the evolving H5N1 avian virus," David Reddy, Roche's executive in charge of bulk sales of the drug, said in a statement.

Shares in Roche Holding AG were slightly higher in a weaker overall Swiss market, outperforming the European drugs sector.

"We stand by the guidance of February when we forecasted 1.1 to 1.2 billion Swiss francs for pandemic use," Roche pharmaceuticals executive William Burns told reporters in Basel on Thursday. "That is the best estimate we can give on the government orders we have."

PRODUCTION RAMP-UP

Bowing to pressure to increase capacity, Roche has struck deals with a total of more than 15 external contractors in nine different countries.

These firms - including some major pharmaceuticals and chemicals groups such as Sanofi-Aventis, Clariant and DSM - will produce intermediate ingredients or all of the drug in order to help speed up production.

Roche has maintained that Tamiflu is tricky to make, requiring a chain of processes, some of which are dangerous. The drug is based on shikimic acid, which can be derived by fermentation or from the pod of the star-shaped anise fruit.

In addition to India's Hetero and China's Shanghai Pharmaceuticals, with which deals were previously announced, Roche has also granted a production sub-license to another Chinese firm.

Roche is also looking at sharing know-how to help start up production in Africa.

Tamiflu was invented by Gilead Sciences Inc and licensed to Roche in 1996.