Roche Holding AG is in talks to buy the almost 40 percent stake in Japan's Chugai Pharmaceutical Co Ltd that it does not already own for about $10 billion, Bloomberg reported, citing people familiar with the matter.

A spokeswoman for Roche declined to comment on the report.

The Swiss group could announce a deal to take full control of its Japanese partner for oncology and arthritis drugs as early as next week, although no final decision has been made, Bloomberg said. (http://bloom.bg/1yF2JNH)

There has long been speculation that Roche might swallow Chugai - following a similar buyout of U.S. biotech group Genentech in 2009 - to maximize exposure to the Japanese drugs market, the world's second largest after the United States.

Roche Chief Executive Severin Schwan was asked about such a move in April 2013 but said then he had no plans to change the company's holding in Chugai, which has been a subsidiary since 2002.

Roche, the world's largest producer of cancer medicines, has a long track record of making bolt-on acquisitions. Schwan reiterated last month that he planned to steer clear of mega-mergers and focus instead on smaller deals and partnerships.

In its most recent deal, Roche agreed in July to pay up to $1.725 billion to buy Seragon Pharmaceuticals, a privately-held U.S. biotech company that researches breast cancer treatments.

Acquiring the rest of Chugai would be a considerably larger purchase but would still be very manageable for Roche, which has a market value of about $250 billion.

($1 = 0.9023 Swiss Francs) (Reporting by Amrutha Penumudi and Joshua Franklin; Editing by Ben Hirschler and David Clarke)