5 charged with theft of GSK cancer drug secrets
By P.J. D’Annunzio, The Legal Intelligencer
Five people including two scientists working for GlaxoSmithKline have been charged with taking part in a scheme to steal trade secrets and methods for manufacturing cancer medication from the drugmaker, the U.S. Attorney’s Office for the Eastern District of Pennsylvania announced Wednesday.
Following an FBI investigation, Yu Xue, 45, of Wayne; Tao Li, 42, of Nanjing, China; Yan Mei, 36, of Nanjing; Tian Xue, 45, of Charlotte, North Carolina; and Lucy Xi, 38, of Westlake Village, California, were indicted on charges of conspiracy to steal trade secrets, conspiracy to commit wire fraud, conspiracy to commit money laundering, theft of trade secrets, and wire fraud. If convicted, the defendants face possible prison time and fines.
According to the indictment, Yu Xue and Xi, who worked in GSK’s Upper Merion Township research facility, allegedly downloaded confidential information from GSK’s network and sent it to co-conspirators Li and Mei, who along with Yu Xue, formed a corporation in China called Renopharma allegedly to market and sell the stolen trade secrets.
Additionally, to cover their tracks, the conspirators attempted to hide the proceeds from the sales under the name of Tian Xue, Yu Xue’s twin sister, the indictment alleged.
According to U.S. Attorney’s Office spokeswoman Patricia Hartman, the defendants were arrested Jan. 5: Yu Xue in Montgomery County; Li in San Diego; Tian Xue in North Carolina; and Xi in the Los Angeles area. Li was detained and is expected to be brought to Philadelphia, Hartman said. The others were released on bail. Mei remains at large.
Yu Xue’s attorney, Peter Zeidenberg, and Tian Xue’s attorney, David Schertler, said they had not yet had a chance to review the indictment and declined to comment further. Li’s attorney, John Joseph, also declined to comment. Xi’s attorney, Eric Yaffe, did not return a call seeking comment.
A GSK spokeswoman said in a statement sent to The Legal that the company plans to conduct an internal review and step up its data security, although the alleged theft was not estimated to have had much of an impact on the drugmaker’s operations.
“We are aware of this issue and have been cooperating fully with the U.S. authorities. While we’re limited on what we can say about this ongoing investigation beyond the details in the indictment, we do not believe the breach has had any material impact on the company’s business or R&D activity,” the statement said.
Yu Xue worked as a research scientist and senior-level manager at GSK from 2006 up until her arrest. At that station, she was tasked with developing various biopharmaceutical products, according to the indictment. She was alleged to have emailed trade secrets relating to at least a dozen products to Li, Mei and others.
Xi, Mei’s wife, was also a scientist at GSK from 2005 to 2015, and was alleged to have emailed confidential information to Mei as well.
Li and Mei, who also have scientific backgrounds, allegedly worked to secure investors for Renopharma and market the stolen trade secrets in China.
Renopharma, headquartered in Nanjing, was advertised in China as a company “with limited U.S. affiliation,” the indictment said, and “publicly touted itself as ‘a leading new drug research and development company, specialized in providing products and services to support drug discovery programs at pharmaceutical and biotech companies.'”
Li, according to the indictment, noted that the company received some assistance from the Chinese government.
“The major funding was from two private investors. We got some supports from the government, including some national awards and extra fundings, tax waive, and a free 4,000 [square foot] lab space,” Li said, according to the indictment.
As of press time, no dates for court proceedings had been set.
IMAGE: GlaxoSmithKline headquaters. Maxwell Hamilton via Wikimedia Commons
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