Two former GlaxoSmithKline scientists were indicted for stealing trade secrets from the drug maker as part of a conspiracy to seed a startup company with a raft of confidential data, according to federal authorities. And they worked with three others who formed different companies to allegedly profit from the information.
The indictment was filed in US District Court for the Eastern District of Pennsylvania on Wednesday.
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At the heart of the alleged plot was Yu Xue, 45, who worked as a research scientist at Glaxo from June 2006 until January 2016 and, as a senior level employee, had access to a substantial amount of information concerning procedures for drug development and manufacturing, according to the 66-page indictment.
The indictment describes her as “one of the top protein biochemists in the world.” She has a PhD in biological chemistry from the University of North Carolina and an undergraduate degree from Peking University in China. According to her resume, she was a project co-leader who worked on monoclonal antibody design, the indictment states. She lives in Wayne, Pa., and worked at a Glaxo facility in Upper Merion, Pa., before she was fired this month.
The feds charge that she downloaded data, such as Powerpoint slides, from her work computer. Much of the data concerned compounds being developed to treat cancer, according to the indictment. Among the types of information she allegedly accessed were schematic representations and biological summaries, as well as a business plan for a quality control unit.
From there, she typically emailed the information to other individuals with whom she formed three different companies — Renopharma, Nanjing Renopharma, and Shanghai Renopharma. Renopharma was registered in Delaware, although it marketed itself as an R&D company largely doing business in China. The other two drug makers were created and operated in China, according to the feds.
“Many of the stolen documents contained GSK’s procedures for researching, developing, and manufacturing biopharmaceutical products which had been developed by GSK over many years – information which would be especially useful for a start-up biopharmaceutical company,” the feds wrote in the indictment.
Her lawyer wrote us a note to say that “Ms. Xue is not guilty of the allegations made against her and [she] intends to contest them vigorously in court.”
This is hardly the first instance in which pharmaceutical employees have been charged with stealing trade secrets. Last year, for example, charges were dismissed against two former Eli Lilly scientists, who were accused of wire fraud for allegedly leaking proprietary information about experimental drugs and providing the data to a Chinese drug maker.
But such cases typically generate headlines and are cited as reasons to vociferously guard trade secrets owned by US life sciences and tech industries. A Glaxo spokeswoman did not say how much the stolen information was worth, but indicated that the company does not believes the “breach has had any material impact on the company’s business or R&D activity.”
The allegedly stolen information, by the way, included data related to a drug from Five Prime Therapeutics, which has a partnership with Glaxo, according to a filing with the U.S. Securities and Exchange Commission. The drug maker disclosed that it is investigating.
The indictment includes charges of conspiracy to steal trade secrets, conspiracy to commit wire fraud, conspiracy to commit money laundering, theft of trade secrets, and wire fraud.
The other Glaxo scientist indicted is Lucy Xi, 38, of West Lake Village, Calif., who worked at the drug maker from July 2008 until November 2015. Others who were also indicted were associates of Xue with whom she formed the other companies: Tao Li, 42, of Nanjing, China; Yan Mei, 36, of Nanjing, China; and Tian Xue, 45, of Charlotte, N.C. Xi, by the way, was married to Mei.