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GSK shares surged today following the pharmaceutical heavyweight's agreement to fork out up to $2.2bn (£1.68bn) to resolve allegations that its heartburn medication, Zantac, was carcinogenic.

The now-discontinued drug had been at the centre of 80,000 lawsuits filed by 10 different US law firms and had cast a shadow over the FTSE 100 company in recent times, as reported by .

Yet, with the settlement disclosed yesterday, it is anticipated to address approximately 93 per cent of the claims, thereby alleviating concerns about the financial burdens on the corporation.

Investor confidence soared, reflected in a more than five per cent increase in GSK's share price as the market reacted positively to the development.

Russ Mould from AJ Bell commented that "investors would have been pleased to see the company get this monkey off its back almost regardless of the cost."

Prior projections by Morgan Stanley had indicated that the º£½ÇÊÓƵ-headquartered pharma firm might have been exposed to potential liabilities amounting to a staggering $27bn (£20bn).

"While some cases are outstanding it is a small proportion of the total and GSK will now seek to tidy up the loose ends," Mould further remarked.

Although GSK has consented to the settlement, the firm has rejected any admission of guilt, citing an absence of "consistent or reliable evidence" connecting Zantac to cancer.