GlaxoSmithKline has agreed to sell its opiates business in Australia to India's Sun Pharmaceutical Industries.
The firms did not divulge the financial details of the deal but said in a statement that they expect to close it by August.
The British drugmaker's Australian opiates business comprises of analgesics made from raw materials found in opium poppy plants, and includes two manufacturing sites in the states of Tasmania and Victoria.
Sun Pharma said it will hire all employees from both sites.
The news boosted Sun Pharma's stock, which was trading 2.42% higher at 2.29pm in Mumbai, while the benchmark S&P BSE Sensex gained 0.42%. India's largest drugmaker by sales said the acquisition will strengthen its pain management portfolio.
Glaxo said the deal will allow it to "focus on delivering its innovative product portfolio" in Australia.
Steve Morris, General Manager, GSK Opiates commented: "The Opiates business has been an important part of our Australian business for many years, but as our portfolio transitions, we believe now is the right time to hand this business over to someone else..."
Glaxo's decision to sell the opiates business comes as Tasmania's poppy industry is facing a tough crop. The UN is expected to trim the state's poppy crop area this week, Reuters reported.
Glaxo supplies some 25% of the world's medicinal opiate needs from poppies grown in Tasmania, according to the company's website.
The UK firm's Australian opiates business raked in a revenue of A$89m (£45m, €62m, $69.6m) in 2013.
Australia's poppy industry is the world's largest legal supplier of pharmaceutical grade opiates for painkillers, and GSK is one of three firms that control the crop and production in Tasmania.
The other two are Johnson & Johnson's Tasmanian Alkaloids, and privately-owned TPI Enterprises.