Britain and the United States are discussing buying extra stockpiles of antiviral drug Tamiflu to protect against a potential bird flu pandemic, Switzerland’s Roche Holding AG said on Monday.

Industry sources in London said the British government could announce a major order for the drug as early as Tuesday.

Roche’s Tamiflu has been singled out by the World Health Organisation as its drug of choice to protect against bird flu and for use in case of a widespread human outbreak.

It is not a cure, but can reduce symptoms and may prevent the spread of infection.

Pharmaceuticals head William Burns told reporters on the sidelines of the company’s annual shareholder meeting that negotiations with British and U.S. officials were continuing.

“We are still in discussions with Britain and America,” Burns said, adding that nothing formal had yet been heard from the British government.

People familiar with the situation said Britain was likely to announce the purchase of enough Tamiflu for one in four of the population - the maximum number the WHO predicts might be infected in an outbreak.

Governments around the world have been stockpiling the drug to combat a possible pandemic of bird flu, which has now killed 47 people in Asia.

Experts fear the virus could mutate into a form that can pass between humans and trigger a pandemic similar to one in 1918-19, which killed 20 million to 40 million people.

Roche has already increased Tamiflu production capacity to meet additional demand and plans to increase it again in 2005.

Ironically, revenues from Tamiflu proved disappointing in 2004, when a relatively mild influenza season meant overall demand declined from 2003, despite the stockpiling initiatives by various governments.