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

(Reuters) - Five people, including two former GlaxoSmithKline GSK.L researchers, were charged with a scheme to steal trade secrets from the British drugmaker for potential sale in China, according to indictments announced by the U.S. Attorney's Office in Philadelphia on Wednesday.

The GlaxoSmithKline logo is seen at the entrance of a building in Luxembourg, September 10, 2013. REUTERS/Yves Herman

The indictments include 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 stolen information on drugs for cancer and other serious diseases “potentially could be sold for millions of dollars to rival pharmaceutical companies and it would also be useful information for a start-up pharmaceutical company,” the complaint said.

The alleged conspirators established three corporations, one incorporated in Delaware, and two likely in China, all using the name Renopharma, to sell the stolen information that could be used to reproduce Glaxo products and drugs in development, to competitors in China, according to the complaint.

One of the five, Yu Xue, was a senior-level manager and biotechnology expert at a Glaxo research facility in Pennsylvania with access to a wide array of secret information. She was fired Jan. 6, Glaxo said.

She is accused of sending confidential information related to a dozen or more products to fellow “conspirators and others,” and also downloading a substantial amount of Glaxo intellectual property to pass along as part of the alleged scheme.

A motion aimed at keeping Yu Xue detained that was filed earlier this month said she “stole millions, perhaps billions, of dollars’ worth of trade secret and other confidential information from her employer, GlaxoSmithKline, to resell in China.”

“Ms. Xue denies these allegations. She has pled not guilty and intends to contest these charges vigorously in court,” her attorney Peter Zeidenberg of Arent Fox said in an emailed statement.

The others named were Lucy Xi, a Glaxo scientist who left the company in November, Tao Li, Yan Mei and Tian Xue, who is Yu Xue’s twin sister. The sister was used to hide proceeds of the crime, according to the complaint.

Mei is still being sought by authorities. Tao Li remains in custody, while the other three were arrested and released on bail, a spokeswoman for the U.S. Attorney’s office said.

Glaxo said it has been cooperating with authorities. “We do not believe the breach has had any material impact on the company’s business or R&D activity,” it said in a statement.

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

(This Jan. 20 story corrects the fourth paragraph to show one of listed companies incorporated in Delaware and two likely in China)

Reporting by Bill Berkrot and Nate Raymond; Editing by Tom Brown