SHANGHAI: Swiss drugmaker Roche Holding AG said yesterday that it had granted a sub-licence to a Shenzhen-based pharmaceutical company to produce Tamiflu, believed to be the most effective medicine against bird flu.

The deal allows Shenzhen-based HEC Group to produce the generic form of Tamiflu known as oseltamivir for use in pandemic prevention and control. The drug will be supplied through government channels, Roche said in a statement.

HEC is also allowed to extend the sub-licence to its two affiliates in Guangdong and Hubei provinces, according to the statement.

HEC is the third company globally to obtain the sub-licence after Shanghai Pharmaceutical Group (SPG) and India-based Hetero Drugs.

"We hope to achieve an initial annual production capacity of two tons or 2 million treatments," said Tu Lang'ou, vice-president of Sunshine Lake Pharm Co, HEC's affiliate in Hubei.

The Shenzhen-based company expects to lift annual production capacity to 5 million treatments.

A treatment of Tamiflu comprises 10 capsules, or 1 gram of oseltamivir.

HEC applied for the patent transfer of Tamiflu in December and was granted approval on March 16 after Roche completed the evaluation of its capacity, including raw materials, facilities and processes.

SPG, the nation's largest drugmaker, acquired the sub-licence in December; and estimated that it would be able to produce 200,000 treatments a month before June.

Roche has been stepping up production of Tamiflu, which is said to be the only effective medicine against the deadly H5N1 strain of the bird flu virus and is in short supply as countries stockpile it for a pandemic.

The Basel-based company is poised to expand its annual production capacity of Tamiflu to 400 million treatments by the year-end, 100 million more than last year's forecast.

Roche said the increased capacity is being achieved by the addition of external production partners as well as expansion of its own facilities. The Swiss company has 15 external contractors in nine countries responsible for the manufacture of Tamiflu.

More than 100 people have died of bird flu, mostly in Asia; and there have been at least 10 human fatalities on the Chinese mainland.