Shares in AstraZeneca were under pressure yesterday after analysts at ING said the Anglo-Swedish drugs giant was on the brink of an intellectual property meltdown.

The broker said that while many investors are aware that the pharmaceuticals industry is facing challenging patent expires, with tough generic competition, the situation is much more serious than investors realise.

ING believes Astra will be the single worst-affected company over the coming years and is forecasting a 40 per cent decline in earnings between 2009 and 2013. It said the group’s early-stage pipeline of products is unlikely to be profitable, even if successful, before 2015, and that cuts in infrastructure and research and development may be necessary, which in turn could force the company to license promising R&D candidates to other groups. ING has issued a sell rating and a target price of £21.25. AstraZeneca’s shares fell 34p to £26.89.

The broker also has a sell rating on GlaxoSmithKline, down ½p to £12.34½, and believes earnings will be broadly flat over the next four years, given that it has absorbed a substantial patent hit already.

Overall, the FTSE 100 closed up 25.95 points to 4,147.06, paring stronger gains earlier in the session after a late collapse in banking shares.

Barclays lost almost a quarter of its value in the final couple of hours of trading, down 32.4p to 98p, as dealers fretted over the group’s capital, that it may not be included in a potential bad bank scheme and its exposure to certain assets. Royal Bank of Scotland didn’t escape, falling 5.2p to 34.7p on similar concerns. Banks were also under pressure after big losses for Bank of America and Citigroup across the Atlantic and the end of the short selling ban.

Elsewhere, miners recovered some of the ground lost earlier in the week as metal prices rose. Eurasian Natural Resources led the index, up 26¼p to 326½p, Rio Tinto gained 106p to £15.07 and Anglo American rose 96p to £13.71.

Inmarsat also made ground, rising 23½p to 415½p after reports from the Far East suggested that the satellite group was still on target to achieve its goal of 6 per cent to 8 per cent revenue growth in its core business and that Harbinger, the US hedge fund, was still interested in buying the group.

TUI Travel was on the backfoot throughout the session, closing 6¼p lower at 213p, as hopes of a takeover by TUI, its largest shareholder, continued to fade amid talk that the sale of Hapag-Lloyd, the German group’s shipping business, was on the rocks. There is concern that RBS is pulling out of lending the money to finance the deal.

In the FTSE 250, COLT Telecom rose 7¼p to 83p after Morgan Stanley raised its rating on the stock to “overweight” from “equal weight”, citing an attractive risk-reward ratio given its current price. GKN fell 4¼p to 90¼p after Cazenove downgraded the engineer to “underperform” from “in line”, on continued deterioration of the car industry.

— New York: Shares on Wall Street swung higher in a volatile session after a US Government rescue injection of $20 billion into Bank of America provided some confidence for markets. The Dow Jones industrial average closed up by 68.73 points at 8,281.22.

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