Two drug companies are fighting over the rights to Tamiflu, an influenza drug that is viewed as the best hope for slowing a possible global pandemic of bird flu.
Gilead Sciences, which invented the drug, said yesterday that it wanted to take back the rights to the drug from Roche, which makes and sells it. Gilead said Roche had not done enough to manufacture and promote the drug, thereby violating the 1996 contract between the companies.
"We believe Roche has devoted only minimal effort to it," Gilead's chief financial officer, John F. Milligan, said in an interview.
Mr. Milligan said that Roche had not started promoting the drug in 43 of the 64 countries in which it is approved. Roche's inadequate manufacturing efforts, he said, had led to shortages, and Gilead, after commissioning an audit, says that Roche owes it another $18 million in royalties...
Mr. Hurley said Roche doubled production last year and planned to double it again this year.
Under the contract, Roche can try to correct the perceived problems before losing its rights.
It is also possible that the companies may renegotiate financial terms rather than switch manufacturing and sales.
The dispute theoretically could affect the supply of Tamiflu.
NB: This is not a propitious time for property rights uncertainty over Tamiflu. Here is the full story.