U.S. Admits French Role in HIV Test Kit : Health: Officials say that the virus used by scientists came from France. Royalties will be more evenly split under a new agreement.

The United States acknowledged Monday that government scientists used a French-provided virus to invent the American test kit for the AIDS virus, and Washington agreed to increase payments to the French under a 1987 royalty-sharing formula.

The new agreement is intended to “normalize the sometimes rocky relations” between the U.S. National Institutes of Health and the Pasteur Institute in Paris, said Dr. Harold Varmus, NIH director.

The two agencies have been at odds since 1983 over credit for discovery of the human immunodeficiency virus and the subsequent race to patent a test for the virus. In 1984, the U.S. Patent Office granted the patent to the American team.

While NIH scientist Robert C. Gallo has been cleared of allegations that he stole the virus from the French, Gallo has conceded that he “likely” used a virus he received from Pasteur researcher Luc Montagnier in inventing the American HIV test kit. Gallo and Montagnier ended up sharing credit for discovering the virus.

The official NIH acknowledgment that Gallo had used a French-provided virus was “something that has never been said before by the U.S. government,” according to Washington attorneys Michael Epstein and Robert Odle, who represented the French in the dispute.

“It’s a complete vindication of the Pasteur Institute,” Odle said in a telephone interview.

Gallo issued a statement, saying: “It is now time for this episode to be permanently closed. Pasteur scientists and I should focus all our energies on seeking a cure for AIDS.”

The two nations reached a settlement seven years ago to share in the royalties for the HIV test kit, based on sales in each country. But largely because more American than French test kits are being sold, the U.S. has received $20 million in royalties to the Pasteur’s $14 million.

Varmus said that the new royalty-sharing arrangement is expected to provide the French several hundred thousand dollars more per year.

His announcement included an open acknowledgment by the NIH and its parent agency, the Department of Health and Human Services, that “scientists at the NIH used a virus provided to them by Institut Pasteur to invent the American HIV test kit.”

Varmus said that the acknowledgment came “in light of the current state of knowledge,” including an independent study in 1991 that supported the French claims.

Under the new arrangement, each side will continue to keep the first 20% of royalties from sales of test kits in each country.

The remaining 80% of each side’s royalties will be pooled and distributed in a different manner, with Pasteur getting 50%, the NIH 25% and the World AIDS Foundation the final 25%.

The old formula gave 25% of the pooled revenues to the World AIDS Foundation, which funds education and research in the developing world, and 37.5% each to France and the United States.

Varmus said that the new formula is intended to give the United States and France “approximately equal shares of the test kit royalties over the lives of the patents.”

He called the new agreement “fair and equitable” and expressed the hope that it has put “this distraction behind us.”