The US drug maker Merck & Co announced on Friday it will pay 4,85 billion dollars to settle 27,000 lawsuits filed by people who contend they or their family members suffered injury from Vioxx painkiller drug.

The drug was pulled from market shelves over health risks in 2004, after a study showed the drug increased the risk of heart attacks if it was taken for more than 18 months.

“This is a good and responsible agreement that will allow the company to concentrate even more fully on its mission of discovering, developing and delivering novel medicines and vaccines,” Merck's chairman and chief executive Richard Clark said in a statement.

Merck, which is the third-largest US drugmaker, said the fund of 4.85 billion dollars would cover about 95 per cent of all claimants, though certain conditions still had to be met and the validity of each individual claim verified.

As of Oct. 9, 2007, in the United States, the Company had been served or was aware that it had been named as a defendant in approximately 26,600 lawsuits, filed on or before Sept. 30, 2007, which include approximately 47,000 plaintiff groups, alleging personal injuries resulting from the use of Vioxx.

According to the terms announced by the company, final payments from the settlement will vary, depending on severity of injuries, length of time that Vioxx was used and each person's risk factors for cardiovascular disease. A complex system would assign points to each claimant and payments could start as early as August 2008.

So far Merck had won 11 of 16 cases that went to court. One Merck verdict was set aside by the court and has not been retried.  Another Merck verdict was set aside and retried, leading to one of the five plaintiff verdicts.  There have been two unresolved mistrials

Vioxx brought in 2.5 billion dollars in revenue for Merck the year before production was halted.

Earlier this year, the U.S. Food and Drug Administration has rejected Merck's bid to sell the pain medication Arcoxia in the United States.