A day after announced a major expansion of its R&D facilities in China, Novartis now says it is buying an 85% stake in vaccines maker Zhejiang Tianyuan Bio-Pharmaceutical.

The Swiss major is shelling out $125 million to get control of Tianyuan, a privately-owned company which more than doubled its sales to $25 million in 2008 compared to 2006. Novartis noted that the deal, which is subject to government and regulatory approval, is part of “a strategic initiative to build a vaccines industry leader in China and expand the group’s limited presence in this booming market segment”.

Tianyuan’s chief executive, Ding Xiaohang, said that “our mission is to build the Great Wall of Health for the people”, adding that the deal will help build “a true international vaccines company”. Tianyuan was founded in 1994 and has an R&D/manufacturing site in Hangzhou, near Shanghai.

China is the world's third largest vaccines market, with annual industry sales of more than $1 billion, and Novartis said there are “expectations for sustained double-digit growth in the future given the government's commitment to improve access to quality healthcare”. The Basel-headquartered group revealed earlier this week that it is also making a $1 billion investment over the next five years, including a significant expansion of the Novartis Institute of BioMedical Research in Shanghai and has invested $250 million in a new facility in Changshu.