Swiss pharma company Novartis International AG is reportedly in talks with New Jersey-based Merck & Co. Inc. to exchange its animal health and human vaccines businesses for the American drugmaker's over-the-counter health products unit.

Reuters, citing an earlier report by Bloomberg, said that the two pharma companies may each trade about $5 billion in assets as part of the deal.

Sources told Reuters last month that Novartis was ready to sell its animal health subsidiary for more than €3 billion ($4.1 billion). The Swiss drugmaker has also opened its books to Bayer AG and other rivals that could take interest in the business.

Pharma companies are shedding businesses and cutting costs due to overseas price controls and pressure on payments from insurers and governments. In June, drug major Pfizer Inc. completed a spin off of its animal health products business, the report said.

Novartis has not finalized a deal with Merck and may choose another option, Bloomberg said in a separate report.