By Pushkala Aripaka

(Reuters) – Britain’s Hikma Pharmaceuticals said on Friday it has started manufacturing Gilead’s antiviral drug remdesivir under contract in Portugal, as the U.S. company outsources to increase availability of the COVID-19 treatment.

Remdesivir is one of only two medicines to have shown to help hospitalized COVID-19 patients in clinical trials, making it a front-runner treatment for the illness caused by the new coronavirus.

Hikma’s Chief Executive Siggi Olafsson said the company will start supplying batches of the drug “soon,” and Gilead is expected to distribute it.

“The terms of the deal are confidential, we are simply a contract manufacturer for Gilead – they order products from us as they expect the sales to be,” Olafsson told Reuters in a telephone interview.

Remdesivir, which is administered intravenously, has been conditionally approved or supported in many regions to treat COVID-19, which has killed more than 800,000 people globally.

A pledge by Gilead to send nearly all of its supplies to the United States between July and September stirred concerns about availability elsewhere.

This week, a bipartisan group of U.S. state attorney generals urged Washington to allow other companies to make the treatment to increase availability and lower the price.

On Friday, Pfizer said it had signed a multi-year deal with Gilead to manufacture and supply remdesivir.

Gilead said on Thursday that its manufacturing network for the drug had grown to more than 40 companies in North America, Europe and Asia.

The company had said in June that it was aiming to supply enough of the drug by the end of the year to treat more than 2 million COVID-19 patients, more than double its prior target of 1 million.

Gilead has signed several pacts with generic medicine makers in Egypt, India and Pakistan to distribute remdesivir in 127 countries. The deals include those with Cipla Jubilant and privately held Hetero.

Hikma’s announcement of the deal with Gilead helped its shares jump more than 10% on Friday as it also reported a jump in first-half operating profit and lifted its sales outlook.

Analysts said the deal highlights Hikma’s “growing importance as a trusted source of essential medicines.”

(Reporting by Pushkala Aripaka in Bengaluru; Editing by Arun Koyyur/Josephine Mason/Susan Fenton)