Drug giant Novartis is selling its $1-billion vaccine production plant in Holly Springs to Australia-based CSL as part of a deal valued at $275 million.

Novartis is disposing its entire influenza-related vaccine business through this transaction that was announced Sunday night.

Just last month, Novartis (NYSE: NVS) celebrated the first shipments of a newly FDA-approved vaccine from the plant.

However, in April Novartis made clear it planned to sell the Holly Springs operation and the influenza vaccine group after a separate, complex deal with GlaxoSmithKline (NYSE: GSK). As part of that deal, Novartis agreed to sell its non-influenza vaccine business to GSK and Novartis acquired GSK’s oncology business. 

Holly Springs, Wake County and the state offered Novartis more than $40 million in incentives to build the vaccine plant, which opened five years ago and now employs 550. Novartis chose to build the Holly Sprints plant in 2006 and received U.S. government funding as part of the $1 billion-plus investment.

Both companies issued statements about the deal late Sunday – early Monday where CSL is based.

In a briefing for investors, CSL noted it was acquiring “state-of-the-art facilities in Holly Springs, US and Liverpool, UK.”

“In CSL, we have found not only an owner for the influenza business that shares our commitment to protecting public health, but also a strong growth platform for the business and our associates,” said Joseph Jimenez, CEO of Novartis.

The Holly Springs plant is the first facility in the United States that can manufacture the drug known as Flucelvax, a revolutionary cell-culture based vaccine harvested from a dog’s kidney.

Traditionally, the flu vaccine has been derived from a virus grown slowly in chicken eggs. In the event of a pandemic or serious flu season, the slow pace of production could mean a shortage of the traditional vaccine.

With cell culture technology, the manufacturing process does not need advance planning, and it can be rapidly expanded to produce new vaccines.

In the event of a flu pandemic, researchers can mass-produce 150 million doses of the drug within six months, Novartis’ president of vaccines for the U.S., Brent MacGregor at the September launch, 

The Novartis business will become part of a CSL subsidiary known as bioCSL.

The deal is not expected to close until sometime next year. One it does close, CSL will become the second largest vaccine maker behind Sanofi in the $4 billion U.S. market, according to CSL.

“Novartis remains fully committed to the influenza business during the transition period to closing, including honoring agreements with customers, research and development for influenza vaccines and product launches,” the company said in a statement.

A write-down of some $1 billion will be taken, Novartis added.

CSL noted in a presentation prepared for shareholders that the Holly Springs plant was part of the deal. A combined company under the CSL subsidiary bioCSL would include manufacturing operations in the U.S., the United Kingdom, Germany and Australia.

In a conference call with analysts, CSL executives said that the Novartis vaccine unit it is buying lost $138 million in 2013. However, CSL said it plans to make the business profitable within two or three years.

“We expect that over the next few years we should be able to turn this business into a successful, leading business within the flu sector,’’ CSL Chief Financial Officer Gordon Naylor said, according to the Australian newspaper.