Drugs giant AstraZeneca has promised to hand more money out to shareholders, ahead of a vote on whether to increase the pay deal for its boss to up to £18.7 million.

On Thursday morning, the Cambridge-based pharmaceutical firm said it would increase its annual dividend payout by 20 cents to 3.10 dollars (£2.47) per share for 2024.

It said the move underlines “the company’s confidence in its performance and cash generation”.

Michel Demare, chairman of AstraZeneca, said: “The board is delighted to announce a 7% increase to the dividend.

“This uplift is in line with our progressive dividend policy, which remains unchanged, and reflects the continuing strength of AstraZeneca’s investment proposition for shareholders.”

AstraZeneca’s profits more than doubled in 2023 after strong sales of its cancer treatments.

The update comes ahead of AstraZeneca’s annual general meeting on Thursday afternoon.

During the meeting, shareholders will be asked to vote on an increased pay deal for long-standing chief executive officer Pascal Soriot.

The company confirmed earlier this year that Mr Soriot was handed a £16.9 million package for 2023, and proposed to increase this to up to £18.7 million for this year.

Shareholders will confirm via a vote whether the pay increase proposals have been approved.

The move has faced significant criticism from shareholder advisory groups, such as Glass Lewis and ISS.

The company said the increase would put his bonus “in line with the median target bonus opportunity of his global peer group”.

One of the firm’s top shareholders, GQG Partners, said earlier this week that Mr Soriot was “massively underpaid” and deserved the potential pay hike.