In a move widely expected, Pfizer abandoned its attempt to buy AstraZeneca for nearly £70 billion ($118 billion) on May 26 as a final deadline mandated by British law approached.

The decision ended a month-long public fight that sparked political concerns on both sides of Atlantic over jobs and corporate tax maneuvers. The deal would have been the pharmaceutical industry's biggest ever.

UK takeover rules now require a cooling-off period, which means that AstraZeneca could reach out to Pfizer after three months, and Pfizer could take another run at its smaller British rival in six months time, whether it is invited back or not.

Earlier, the British drugmaker had rejected what its US rival said was its "final offer" of £55 per share but Pfizer had promised it would not go hostile by taking its offer directly to AstraZeneca shareholders.

"Following the AstraZeneca board's rejection of the proposal, Pfizer announces that it does not intend to make an offer for AstraZeneca," the US company said in statement.

"We continue to believe that our final proposal was compelling and represented full value for AstraZeneca based on the information that was available to us," said Pfizer CEO Ian Read.

AstraZeneca Chairman Leif Johansson welcomed Pfizer's decision to back down, which he said would allow the British drugmaker to focus on its growth potential as an independent company.

What happens next will depend upon whether AstraZeneca's share price deteriorates in the coming weeks and how hard its shareholders push for it to revisit a deal with Pfizer.

The merger would have restored Pfizer as the world's largest drugmaker by sales, a position it relinquished to Swiss-based Novartis when billions of dollars in annual revenue evaporated after its top-selling cholesterol fighter Lipitor began facing generic competition in 2011.