U.S. private equity firm Bain Capital has bought Mitsubishi Tanabe Pharma in a deal worth 510 billion yen ($3.4 billion), saying it was encouraged by prospects of regulatory change for Japan's drug industry.

The Japanese chemical company has agreed to sell its pharmaceutical business to Bain Capital for more than $3 billion, in a bid to focus on its key businesses.

Bain Capital is nearing a deal to buy Mitsubishi Chemical Group Corp.’s pharmaceutical unit, people familiar with the matter said, adding to a dealmaking boom in Japan.