UPDATE 2-Novartis buys China vaccine stake for $125 mln

* To buy 85 pct stake in Zhejiang Tianyuan

* China and vaccines both seen as growth spots

* Privately owned Tianyuan had 2008 net sales of $25 mln

* Novartis shares fall 1 pct

(Adds analyst and company comment, further detail, shares)

By Sam Cage

ZURICH, Nov 4 (Reuters) - Swiss drugmaker Novartis (NOVN.VX: Quote, Profile, Research) is buying an 85 percent stake in privately owned Chinese vaccines company Zhejiang Tianyuan for $125 million to boost its presence in the fast-growing market, it said on Wednesday.

Emerging markets are a sweet spot for companies like Novartis, which is also investing $1.25 billion in research facilities in China, while GlaxoSmithKline (GSK.L: Quote, Profile, Research) has made developing countries a top priority. [ID:nL3525806]

Drugmakers' traditional model is under threat from looming loss of patents giving them exclusivity on some big sellers, and they are keen to diversify from the core business of prescription medicines into areas like vaccines. [ID:nL9190149]