AstraZeneca, Europe's third-largest drugs group, has turned to an insider for its new chief executive, appointing the current boss of its American and Canadian operations as the replacement for the departing Sir Tom McKillop.

David Brennan, who is executive vice-president for North America at AstraZeneca, takes over as the new chief executive of AstraZeneca at the beginning of next year, when Sir Tom leaves the company.

Sir Tom, who reached traditional retirement age last March, is widely tipped for a move to Royal Bank of Scotland, although the financial services group has yet to make any comment about the prospect of him joining.

AstraZeneca has been on the lookout for a new chief executive since Sir Tom reached retirement age.

Louis Schweitzer, chairman of AstraZeneca, said: "The board's appointment of David Brennan is the outcome of a rigorous selection process from a very strong list of candidates. David has over 30 years' experience in the pharmaceutical industry and has played an important part in the development of AstraZeneca."

Mr Brennan is believed to have been one of three internal candidates for the chief executives job. The other two are thought to have been Jon Symmonds, the UK-based finance director, and John Patterson, who is in charge of AstraZeneca's research and development business.

News of Mr Brennan's appointment came as AstraZeneca reported a 55 per cent jump in second quarter profits to $1.75 billion before tax. Overall for the first half, pre-tax profits rose by 52 per cent to $3.2 billion.

Shares in AstraZeneca closed 117p - or 5 per cent higher - to stand at 2480p after the board recommended a 29 per cent increase in the interim dividend to $0.38.

The group also cheered investors with news that sales of Crestor, the cholesterol-treatment drug that AstraZeneca hopes will be a blockbuster, leaped by 72 per cent to $590 million in the first half.

AstraZeneca said that, "following two quarters of robust sales and excellent productivity gains", it was upping its earnings forecasts for the year.

"Sales growth is now expected to approach double digits in constant currency, and earnings per share is now anticipated to be above $2.75, implying an operating margin around 27 per cent for the full year," the group said.

Sir Tom said: "Strong sales growth and productivity gains have delivered an outstanding first half performance leading to higher shareholder returns and an increase in financial targets for the full year."

Sales for by 13 per cent to $6.1 billion in the second quarter, and by 15 per cent to $11.9 billion at the half-year stage.

Meanwhile rival GlaxoSmithKline (GSK) announced an 8 per cent rise in second-quarter pretax profit after strong sales for some of its key drugs.

The company reported that pretax profit rose to £1.662 billion in the three months to June compared with the same period last year. Net profit rose almost 7.0 per cent to £1.189 billion.

GSK said that sales increased by six per cent to £5.246 billion in the three months to June 30, compared with a year-earlier figure of £4.971 billion.

The results brought relief after Australian biotechnology firm Biota Holdings said yesterday it was seeking damages of up to A$430 million (£150 million) from GSK for allegedly failing to support its influenza drug Relenza.

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