CORE Technologies, an Ayrshire pharmaceutical company specialising in

drug delivery products, has attracted #1.3m in venture capital as it

finalises clinical tests on both sides of the Atlantic.

Founded three years ago, Core has developed and patented a hydrogel

polymer substance which allows far greater precision in the non-oral

administration of a wide range of medicines.

The development, currently undergoing the regulatory hospital tests,

has attracted the attention of financial institutions which see a

potentially vast business market as increasingly sophisticated drugs are

produced.

Venture capital group 3i, Prelude Technology Investment, Scottish

Enterprise, and an American institition have backed the company which

was founded in 1991 by Jim Pickard.

''This money should keep us on course for the launch of our first

hydrogel products in Europe before the end of 1996,'' Mr Pickard, a

research pharmacist, said yesterday.

Like most new hi-tech companies, Core needs substantial injections of

working capital to keep the business ticking over until the fruits of

its research pass the stringent clinical controls.

''At the moment we are doing hospital tests with our products which

basically offer a far more sophisticated way of the controlled release

of drugs than currently given by the standard pessaries and

suppositories,'' he said.

By absorbing body fluid at a pre-fixed rate, the devices are ideal for

certain types of drugs and for use by people who cannot take medicines

orally. An anti-fungal vaginal pessary and a morphine-based rectal

suppository for cancer patients are the two main products being

currently researched.

Core, with six full-time staff and only a nominal turnover, hopes to

employ about 50 people within the next four years as demand increases

and Mr Pickard foresees a listing on the Stock Exchange next year to

raise more capital.

3i has a good record in backing innovative companies and Hazel

Leishman of the group's Edinburgh office is confident that the #250,000

equity funding will pay off.

''We see Core Technologies as having a technological edge in what

could be a vast market in healthcare and another tranche of capital

funding from us is likely in the future,'' she said.

The American backer, Calvert Social Venture Partners, is to manage

selected clinical studies.