JERUSALEM, July 1 (Reuters) - Bristol Myers Squibb ( BMY )

has agreed to pay 10 million shekels ($2.7 million) in

Israel to settle a potential case over its blocking of a generic

version for anti-cancer drug Imnovid, Israel's Competition

Authority said on Monday.

The anti-trust agency said that Bristol and Neopharm

Scientific, the Israeli distributor of Imnovid - used for the

treatment of multiple myeloma and AIDS-related Kaposi sarcoma -

declined a request by KS Kim International for drug samples to

make a copycat version of Imnovid.

After five months, the drugmakers provided the samples but

the competition authority said it delayed competition for such

an important drug.

Bristol, which has to make the payment within 60 days, and

Neopharm were not immediately available to comment.

"We want to send a message to companies that have a dominant

position in the market that they cannot act in a manner that is

likely to reduce competition," Jonathan Cwikel, deputy legal

counsel for civil and administrative affairs, told Reuters.

The authority intended to fine Neopharm 64 million shekels

and an unnamed company executive 600,000 shekels, but even

before it was able to issue a similar letter to Bristol, the

firm offered the authority to settle, he said.

In signing the consent decree - which was seen by Reuters -

and paying 10 million shekels, Bristol, Cwikel said, rejected

any responsibility and did not admit any liability. "On our

part, we did not finalise our inquiry so we don't have any

formal decision against them," he said.

So far, Neopharm has decided not to settle, Cwikel said, and

will be presenting oral arguments at a hearing on Monday.

($1 = 3.7501 shekels)