Glaxo signs early drug discovery deal with UK firm

LONDON, Jan 12 (Reuters) - GlaxoSmithKline (GSK.L) has signed a three-year drug discovery deal with privately held British biotech company Biotica Technology, giving the drugmaker access to Biotica's early-stage work in inflammatory diseases.

Biotica said on Monday it would receive an initial cash payment and up to 86 million pounds ($129.6 million) for each compound successfully developed.

Glaxo has also made an upfront equity investment in Biotica.

The collaboration focuses on novel erythromycin-based macrolide compounds for treating unspecified inflammatory diseases. These compounds have yet to reach the pre-clinical development stage, according to Biotica's website, which means they are still many years from hitting the market.

Biotica's most advanced research is in a group of compounds known as rapamycin analogues, where it is working with Wyeth (WYE.N). (Reporting by Ben Hirschler; Editing by Jon Loades-Carter)