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GSK scientist pleads guilty to stealing trade secrets

Biochemist planned to set up a competing company with Chinese government help

by Marc Reisch
September 5, 2018 | APPEARED IN VOLUME 96, ISSUE 36

 

09636-buscon4-court.jpg
Credit: Jeffrey M. Vinocur/Wikipedia Commons license
A view of the U.S. District Court for the Eastern District of Pennsylvania.

Yu Xue, a Ph.D. biochemist who worked at GlaxoSmithKline’s research facility in Upper Merion, Pa., has pleaded guilty to stealing intellectual property (IP) from her former employer, according to the U.S. Department of Justice. She has not yet been sentenced.

Xue planned to use the pilfered research to benefit a Chinese drug company, Renopharma, that she and her associates had set up with financial support from the Chinese government, the Justice Department says.

According to the original 2016 indictment, Xue, who worked for GSK between 2006 and 2016, was accused of stealing IP on pharmaceuticals under development, including a monoclonal antibody similar to the cancer therapy Herceptin. Over time, the partners aimed to develop their own antibody drugs.

“We cannot allow U.S. citizens or foreign nationals to steal sensitive business information and hand it over to competitors in other countries,” says William M. McSwain, the U.S. Attorney for the Eastern District of Pennsylvania in Philadelphia. Trade secret theft has plagued a number of U.S. firms. For example, a Bristol-Myers Squibb scientist pleaded guilty in 2010 to stealing secrets to start a business in India.

The Justice Department says Xue sent sensitive GSK documents via email and portable storage devices to associates in China. The FBI discovered a number of those documents when it seized a computer belonging to one of her associates.

However, missing from the Justice Department’s announcement of Xue’s plea is another former GSK researcher, Lucy Xi. The department’s 2016 account of events accused Xi of forwarding confidential information provided by Xue to others involved in Renopharma and of helping to form the firm.

Xi’s lawyers filed documents with the U.S. District Court in Philadelphia seeking to dismiss charges against her. The lawyers claim the government charged her to “coerce her to cooperate against defendants.” They also claim that an FBI agent essentially acknowledged Xi “had no malicious intent to purloin trade secrets from GSK.”

In early August, the judge overseeing the case refused to dismiss charges against Xi, and her case is apparently still pending. The court has sealed many recent files in the Renopharma case.

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