Novartis and GlaxoSmithKline have announced an asset swap worth more than $20 billion, with an eye to bolstering their best businesses and exiting weaker ones.

The swap, which calls for Novartis to buy GSK's oncology portfolio while GSK acquires Novartis' vaccines business, quickly followed reports that AstraZeneca had turned down a $101 billion bid approach from Pfizer.

The Swiss group said it had agreed to pay $14.5 billion for GSK's oncology products, plus another $1.5 billion if results of a trial in melanoma are successful.

The deal will strengthen Novartis's world no.2 position in oncology behind Roche.

Novartis said it was also selling to GSK its vaccines, excluding flu, for $5.25 billion plus potential milestone payments of up to $1.8 billion and ongoing royalties, as well as creating a joint venture with the British company in consumer healthcare.

Separately, it plans to sell its animal health arm to Eli Lilly for about $5.4 billion.

Novartis CEO Joe Jimenez said the revamp would help make his employer "fighting fit" to meet the challenges of the global healthcare industry over the next ten years.

He said the deals would lower overall sales at the Swiss group by around $4 billion, but result in higher profit as it swaps lower-margin vaccines for higher-margin oncology drugs.

GSK chief Andrew Witty said his group did not have sufficient scale to compete in cancer drugs, so it made sense to put them into "the hands of somebody who is a world leader in oncology."

Conversely, he said the deals with Novartis will strengthen the group in two of its core franchises: vaccines, a business that supplied more than 2 million shots every day, and consumer health, where it will take the lead in running a business worth about $10 billion in annual revenue with the Swiss group.

Witty said the plans also constitute a further step in his strategy of focusing on areas of strength, while moving further away from the monolithic model of drugs companies that try to do everything.

After the deal, GSK will draw 70% of sales from its franchises in respiratory, HIV, vaccines and consumer health.

Novartis said it would start a separate sale process for its flu business immediately, which was not part of the GSK deal.