NEW YORK (AP) -- Tobacco company Philip Morris International Inc. may expand its business in China — a flu vaccine business.

The company, the world's largest seller of cigarettes after China National Tobacco Corp., on Tuesday signed a deal with Canadian vaccine developer Medicago Inc. to license experimental flu vaccines for sale in China.

China's government controls the country's cigarette market through China National Tobacco Corp.

Medicago uses tobacco leaves to make influenza vaccines. Philip Morris International invested in Medicago in 2011 and has a 40 percent stake in the company. The vaccine maker said expanding to emerging markets was a key part of its growth strategy.

Under the deal, Philip Morris International will pay Medicago $4.5 million for rights to develop, manufacture, and sell Medicago's vaccines for pandemic and seasonal flu in China. Medicago can get another $7.5 million if the vaccines advance through clinical development, and it will receive royalties on sales of the vaccines if they are approved.

In a separate agreement, Medicago is licensing plant-based protein development technologies from Philip Morris International for $700,000. The tobacco company will get royalties on sales of any products that use the technology.

Philip Morris International reported $31.1 billion in revenue last year, excluding excise taxes, shipping 915.3 billion cigarettes.

Shares of Philip Morris International, which is based in New York, rose 27 cents to $91.55 in late morning trading.