AstraZeneca allays MSD payment fears

AstraZeneca has said that any payment to rival MSD regarding an agreement over payment of royalties will not exceed $3.3 billion.

Reports over the weekend had suggested that AstraZeneca could be in a position where it would have to pay as much as $4.5 billion, but the company yesterday dismissed claims that the payout would be so large.

“Based on our current estimates, if [MSD] exercises the first option in 2008, the net payment to [MSD] is unlikely to exceed the minimum value of $3.3 billion,” said chief financial officer for AstraZeneca, Jon Symonds, according to Reuters.

The company also said that such a payment was within its current resources and that it would have no effect on its shareholder distribution policy.

AstraZeneca’s deal with MSD means that in 2008 the company may have to buy out the option owned by MSD on certain AstraZeneca products, such as Nexium and Toprol XL.

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