TECHNOLOGY developed by a North-East company could lead to x-ray scanners in tube stations and shops across the UK thanks to £1m in funding.

Durham Scientific Crystals (DSC), which is based in Sedgefield, was formed two years ago to commercialise technology developed by Durham University's physics department.

DSC has agreed the funding deal with US technology investor Amphion Innovations.

The money will be invested in the business to help with product marketing, increasing its patent portfolio and recruitment.

Crystals developed at DSC can dramatically reduce the cost of manufacturing x-ray scanners for security and medical applications.

Cheaper security scanners could bring the equipment within the reach of shops, hotels and train or Tube stations, which could help to prevent terrorist attacks.

The technology can also improve the quality of the x-ray images and the speed they are produced.

The company plans to be trading profitably by 2008.

DSC is in talks with companies that include BAE Systems, the European Space Agency and Dutch electronics group Philips.

The agreement with Amphion could also open up the US medical imaging sector, helping early diagnosis of conditions such as Alzheim-er's disease.

The market is a £40m industry in the US, representing about ten per cent of all medical care expenditure.

Chris Pyewell, head of innovation, industry and science at regional development agency One NorthEast, said: "It is really good news that a US equity company has come to the North-East and is interested in the North-East as a science and technology base.

"This was something that wasn't happening 18 months ago, and we think it is a positive sign for other technology companies here.

"They have never looked at the North-East before because we weren't considered a centre for high-tech spin-off companies - but now we hope this will raise our profile."

DSC was introduced to Amphion through the North-East Centre of Excellence for Nanotechnology, Micro and Photonic Systems (Cenamps), one of One NorthEast's five centres of excellence in the region.