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Falkus was an artificial moon of Skaro. Falkus orbited Skaro 3 times in every 24 Earth hours.
Origins
Falkus was created by the Daleks based upon Davros' plans. The city under the surface was a living machine, it could repair and service itself, hear, see and feel. The Daleks also built Falkus with defensive capabilities should it ever be attacked.
The Daleks who built Falkus had their memories wiped so that they did not know the true purpose of Falkus. (REF: Doctor Who and the Daleks Omnibus)
Purpose
Falkus served as a sanctuary for the Dalek race and all Daleks would think of Falkus with a sacred quality although none of them knew of its true function. Only the Dalek Supreme possessed the knowledge of Falkus' purpose; a planet-sized Dalek gene-bank capable of creating thousands of Daleks in mere seconds.
Falkus was created as the Daleks last hope in the face of extinction. The living mind of Davros resided within the heart of Falkus, ready to be placed within a new body and start the production in the factory should the Daleks ever become extinct. The Dalek Supreme would visit Falkus every hundred years in a one-man shuttle to make sure that Falkus was still running. (REF: Doctor Who and the Daleks Omnibus)
History
The Doctor once battled the Klade on Falkus. (EDA: Father Time)