NEW YORK (Reuters) - Merck & Co has agreed to pay $4.85 billion to settle claims that its painkiller Vioxx caused heart attacks and strokes in thousands of users, the drugmaker said on Friday.

The agreement covers lawsuits filed against the company in U.S. courts, resolving a major legal battle that has dogged the drugmaker since it pulled Vioxx off the market three years ago. Merck recalled the popular painkiller, which had $2.5 billion in annual sales, in September 2004 after a study showed it doubled the risk of heart attack and stroke in patients taking it for more than 18 months.

In the settlement, reached with representatives of plaintiffs in federal and state courts, Merck did not admit Vioxx caused patient injury and did not admit fault. The drugmaker, whose shares rose nearly 2 percent in pre-market trade on news of the deal, said it would take a charge of $4.85 billion to cover costs of the agreement.

The settlement marks a shift in strategy for Merck, which previously said it intended to fight Vioxx litigation on a case-by-base basis rather than consider a broad settlement.

“The agreement is structured to provide a significant degree of certainty toward resolving the majority of the outstanding Vioxx product-liability claims in the United States for a fixed amount,” said Richard Clark, chairman, president and chief executive officer of Merck.

The drugmaker said it would still defend all claims not included in the settlement. Since the withdrawal of Vioxx, Merck has won 11 court cases over the drug and lost five. While it is appealing those cases that it lost, analysts said the settlement will solidify Merck’s future. Continued