NEW YORK (CNNMoney.com) - Sanofi-Aventis, the French pharmaceutical giant, said on Thursday it has signed an agreement with Swiss drug maker Roche to produce the key component for Tamiflu, the leading treatment for bird flu.

Sanofi-Aventis (down $0.07 to $44.85, Research), the biggest drug maker in Europe with 2005 sales totaling $32.9 billion, said its plant in France would produce shikimic acid, an important raw material for Tamiflu.

Roche, which had $22.7 billion in 2005 sales, produces Tamiflu, also known as oseltamivir, and has acknowledged it can't meet worldwide demand without enlisting other companies. The Basel-based drug maker said Thursday that its partners have helped it boost Tamiflu production to up to 400 million treatments annually. Roche said the 15 partners have added 100 million treatments to its annual capacity.

Bird flu, also known as H5N1, has killed nearly 100 people, mostly in Asia. The disease can be transmitted from birds to humans, mostly from contact with raw blood or flesh, but cannot be passed from human to human. However, fears that the virus could mutate have spurred a run on Tamiflu.

To read about Sanofi-Aventis' most recent bird flu contract with the U.S. government, click here.

To read about Tamiflu's potential competition, click here.