China's pharmaceutical market expanded by 22 percent last year, while the proportion of people in India who can afford drugs is expected to rise from 35 percent to 80 percent in 2010, said Daniel Vasella, chairman and CEO of the company.

    Addresing an annual meeting of the company, Vasella said China and India are two important places it is targeting an inceased presence, particularly in the generics market.

    "With economic growth there is always a pattern of associated healthcare improvements as citizens demand better provisions," he said.

    "Economic prosperity is also accompanied with more sedentary work such as sitting behind computer screens. Children also start to play computer games rather than play soccer outside. This leads to obesity, hypertension and diabetes, which increases the need for medication," he added.

    Thomas Ebeling, CEO of Novartis Pharma AG, said Asia was the biggest growth market in the world for generics.

    Ebeling said Novartis intends to expand its generics business in China with the possibility of taking over local firms.

    "We can contribute to China's growing demand for medication with our broad portfolio at affordable prices," he said, adding that Novartis also needs to produce locally in order to compete in China.

    The conference also heard that Novartis is looking at setting up a research and development facility in either Shanghai or Beijing, starting with a "few hundred" scientists.

    Novartis was formed in 1996 through the merger of Ciba-Geigy and Sandoz.

    The company became the world's biggest producer of generic drugs last year when it bought German company Hexal with its U.S. strategic partner Eon Labs.