Governments Pressing Roche for More of Its Anti-Flu Drug

by ANDREW POLLACK,
The New York Times

Basel, 20 Oct 2005 - A senior executive at Roche said yesterday that the world was going mad in its clamor for the company's anti-influenza drug, Tamiflu, making it harder to supply those who need it to treat the flu this winter.

William M. Burns, chief executive of Roche's pharmaceutical business, spoke to securities analysts yesterday after the company reported that its sales for the third quarter increased 20 percent to 8.82 billion Swiss francs ($6.8 billion).

While much of the increase came from cancer drugs, sales of Tamiflu more than doubled to 279 million Swiss francs ($215 million), from 110 million francs in the same quarter a year earlier. For the year, the company expects Tamiflu sales to roughly triple to 1 billion to 1.2 billion Swiss francs ($770 million to $925 million).

Roche has been unable to keep up with demand as governments have been stockpiling Tamiflu because of concerns over a human pandemic caused by bird flu. Pressed by governments and critics who accused the company of putting profits and patent protection ahead of public health, Roche said on Tuesday that it would consider allowing other companies or governments to make the drug.

During a conference call with analysts, Mr. Burns was asked for details about Roche's licensing plans but did not offer much.

He said Roche had gotten a flurry of inquiries but only one formal request from an Asian country, presumably Taiwan. He said Roche would consider letting that country produce for its own needs and would also evaluate other proposals.

"We are not interested in people that just want commercial hijacking," he said. "We are not interested in people that really aren't serious or can't fully contribute."

Mr. Burns did not specifically address whether Roche would allow generic drug companies to sell versions of Tamiflu at low prices. "I have no preconceived notions of what this does to timing, pricing, or all the rest of it," he said.

Roche has maintained that other companies would not be able to produce the drug quickly because of Tamiflu's complex production process. Mr. Burns said Roche had about 12 plants involved in production, about half of them belonging to contractors, with about 50 companies supplying ingredients or intermediaries.

A new American factory to produce Tamiflu capsules took 15 months to bring online, including the time needed for regulatory approval. "Although there's a lot of political invective at the moment, as ever it's much more complex than people make it out to be," Mr. Burns said.

Roche will supply about twice as much Tamiflu for conventional flu this winter as last winter, Mr. Burns said, but he added that it was unclear how much would actually be used to treat the flu and how much would be stashed in medicine cabinets to be saved for a possible pandemic.

About a third of the Tamiflu sales in the third quarter were not for government stockpiles. And since there were no outbreaks of flu in the quarter, much of that probably went into personal or corporate stockpiles, Mr. Burns said.

He said that after four ducks were found infected in Romania, "Europe went mad" and that it was now impossible to find any Tamiflu in Paris.

At times, Mr. Burns expressed exasperation that Roche was being criticized for not supplying a drug that almost no one wanted until recently. Too much attention, he said, was focused on Tamiflu supplies when it came to preparing for a pandemic.

"Can I just remind us all," he said, "that governments need to think: How are they going to run their airports? Is public transport going to run? How do you keep your hospitals open? What do you do with the capacity in intensive care units? Do you have enough respirators, iron lungs, ways in which you can handle people that are in respiratory distress?

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