Astra Zeneca, SmithKline Beecham and Glaxo Wellcome say that if the government prevents doctors from prescribing Relenza on the National Health Service, it will destroy their industry.

The government's National Institute for Clinical Excellence ( Nice) recommended the ban, and the three companies say this body presents a new competitive hurdle for UK drug companies.

In a letter to Prime Minister Tony Blair, quoted in the Financial Times, they said this advice " has potentially devastating consequences for the future of the British-based pharmaceutical industry."

"We received repeated assurances from ministers and from Sir Michael Rawlins ( chairman of Nice) that our concerns were well understood and that Nice would not operate as a fourth hurdle for new medicines...The landmark ruling on Relenza makes it crystal clear that our worst fears were fully justified," the letter said.

The industry is concerned about the cost of developing new drugs, as delays for regulatory approval has lengthened, increasing costs dramatically.

Chairman of Glaxo Wellcome, Richard Sykes: "One of the finest examples of technological industry in Britain"

Ministers had earlier been warned that leading drugs companies will consider pulling out of Britain if the government adopts an "antagonistic" attitude towards the pharmaceutical industry.

The warning from the chairman of Glaxo Wellcome comes as the latest broadside in the row over the rejection of the anti-flu drug Relenza for National Health Service prescriptions.

Glaxo Wellcome is threatening legal action against the government after the drug was rejected for prescriptions on the NHS.

The company wants a judicial review after of the decision by Nice.

The institute said there was not enough evidence that Relenza - a powder spray inhaled through the mouth and costing £24 a time - was cost effective.

'Serious threat'

In a letter to Health Secretary Frank Dobson published in the Sunday Telegraph, Glaxo chairman Sir Richard Sykes said the decision represented "a very serious threat to the future of one of the UK's most successful international industries."

Relenza is said to reduce the length and severity of flu if taken at the right time.

The BBC's Peter Morgan: "The government cannot be expected to pay for treatments just because industry wants them to"

A leak of Nice's decision on Friday wiped 2% off Glaxo shares as the market feared the decision could limit Relenza's sales potential.

The institute warned that the drug could cost the NHS £115m if there was a flu epidemic. But Glaxo says the cost to Britain's taxpayers in a normal year would be £10-15m. Glaxo job cuts

On Tuesday, Glaxo announced 1,700 job cuts in the UK, as part of a total 3,400 job cuts worldwide.

The pharmaceuticals company will phase out secondary manufacturing activities at Dartford, Kent, with the loss of about 1,500 jobs. A further 200 will be cut at its site in Speke, Liverpool. Both sets of UK cuts would be phased in over the next four years, the group said.

It said it would use early retirements, voluntary redundancies, re-training and re-deployments of staff to minimise the impact of the job losses. Glaxo will continue to invest in primary manufacturing in Dartford.