U.K. drug maker Shire PLC (SHP.LN) Monday said it inked a deal with Denmark's Santaris Pharma A/S to develop new drugs for rare diseases.

Shire and privately-held Santaris said they entered a research collaboration to use Santaris' locked nucleic acid, or LNA, drug technology to try to find new drugs for rare genetic conditions. They didn't say specify what conditions they were looking at.

Santaris said it will receive initial payments of $6.5 million and another $13.5 million once it has completed some early studies. The Danish company said it is eligible for another $72 million for each of five potential drug candidates in development and regulatory milestones, and will receive a royalty on sales of any drugs that eventually make it to market.

Santaris's LNA technology is designed to create drugs that mimic bits of ribonucleic acid, or RNA, a kind of messaging system involved in the production of proteins in cells and gene expression.

The aim is to use these experimental LNA therapeutics, called oligonucleotides, to deactivate pieces of RNA associated with disease. These oligonucleotides are also hardier than other types of RNA-based drugs, according to Santaris.

The science of RNA-based drugs is still largely in the very early stages of development. Other firms in the field include Alnylam Pharmaceuticals Inc. (ALNY) of the U.S. and the U.K.'s Silence Therapeutics PLC (SLN.LN).

Santaris also has partnerships with GlaxoSmithKline PLC (GSK.LN) and Wyeth (WYE) and has programs in cancer, metabolic disorders and infectious diseases.

Company Web site: www.shire.com

-By Jason Douglas, Dow Jones Newswires; 44-20-7842-9272; jason.douglas@dowjones.com