New Delhi: Drug maker Roche Holding AG has granted a sub-license to Hyderabad's drug firm Hetero Drugs in India to produce Tamiflu (generic name oseltamivir) for developing nations. This is the second such deal to boost output of the scarce anti-viral drug.

Hetero Drugs, has succeeded in becoming the first company in India to obtain the licence to manufacture the bulk drug for the Indian markets. Ranbaxy and Cipla are other Indian companies, which had expressed interest.

Dr Ashwani Kumar, the Drug Controller General of India has said the licence for Ranbaxy Laboratories will soon be given. He said Roche has also been given permission to market the drug in India. "We just had three applications, no other drug company applied," said Dr Kumar.

The agreement with Hetero covers India and other developing nations and allows the Indian firm to produce the flu treatment specifically for governments wishing to create emergency stores.

Roche's decision to outsource the manufacture of Tamiflu to other companies is due to pressure on the Swiss drug maker to increase output as governments around the world are stockpiling the drug, regarded as the best defence against the bird flu pandemic.

Roche said the agreement with Hetero would have an immediate effect on the availability of the drug. Roche has also granted a sub-license for the overall production of Tamiflu, for pandemic use to Shanghai Pharmaceutical Group.

By receiving a production sub-license from Roche, Hetero has to adhere to the new legislation governing patents, which comes into effect on January 1, 2005, in India, Roche said.

Roche holds an exclusive licence to produce Tamiflu, first discovered by the US firm Gilead Sciences Inc. The World Health Organisation has asked governments to create stockpiles of drugs like Tamiflu, part of a class called neuraminidase inhibitors, to protect their populations in the event of an outbreak of avian flu.

Apart from Chinese pharma company Shanghai Pharmaceutical Group, Roche has identified 12 other partners in various countries and is in talks with local players in these countries including India for similar deals. These companies reportedly include major pharmaceutical companies, generic manufacturers and speciality chemicals producers.

The bird flu virus also known as the H5N1 bird flu virus has killed 70 people since it swept through Asia in 2003.