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Pin to quick picksGlaxosmithkline Share News (GSK)

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CORRECTED-Five charged in U.S. with stealing secrets from GlaxoSmithKline

Thu, 21st Jan 2016 17:42

(In Jan. 20 item, corrects in 4th paragraph to show one oflisted companies incorporated in Delaware and two likely inChina)

By Bill Berkrot

Jan 20 (Reuters) - Five people, including two scientists whodid research for GlaxoSmithKline, were charged with ascheme to steal trade secrets from the British drugmaker forpotential sale in China, according to indictments announced bythe U.S. Attorney's Office in Philadelphia on Wednesday.

The indictments include charges of conspiracy to steal tradesecrets of Glaxo medicines, conspiracy to commit wire fraud,conspiracy to commit money laundering, theft of trade secrets,and wire fraud.

The stolen information on drugs for cancer and other seriousdiseases "potentially could be sold for millions of dollars torival pharmaceutical companies and it would also be usefulinformation for a start-up pharmaceutical company," thecomplaint said.

The alleged conspirators established three corporations, oneincorporated in Delaware, and two likely in China, all using thename Renopharma, to market and sell the stolen information thatcould be used to reproduce Glaxo products and drugs indevelopment, to competitors in China, according to thecomplaint.

One of the five, Yu Xue, is a senior-level manager andbiotechnology expert at a Glaxo research facility inPennsylvania with access to a wide array of trade secretinformation.

She is accused of emailing confidential information relatedto a dozen or more products to her personal email account andforwarding it to fellow "conspirators and others," and alsodownloading a substantial amount of Glaxo intellectual propertyto pass along as part of the alleged scheme.

A motion aimed at keeping Yu Xue detained that was filedearlier this month said she "stole millions, perhaps billions,of dollars' worth of trade secret and other confidentialinformation from her employer, GlaxoSmithKline, to resell inChina."

"Ms. Xue denies these allegations. She has pled not guiltyand intends to contest these charges vigorously in court," herattorney Peter Zeidenberg of Arent Fox said in an emailedstatement.

The others named were Lucy Xi, a former Glaxo scientist, TaoLi, Yan Mei and Tian Xue, who is Yu Xue's twin sister. Thesister was used to hide proceeds of the crime, according to thecomplaint.

All were arrested except for Mei, who is being sought byauthorities. Tao Li remains in custody, while the other threewere released on bail, according to a spokeswoman for the U.S.Attorney's office.

The alleged crimes took place between Jan. 1, 2012 and Dec.28, 2015, the complaint said.

Glaxo could not immediately be reached for comment. Thecriminal complaint says the company was aware of theinvestigation by the Federal Bureau of Investigation. (Reporting by Bill Berkrot and Nate Raymond)

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