Thursday, May 05, 2022

Chinese Convicted, Others Pleaded Guilty to IP Theft with Assistance from PRC

Today, United States Attorney Jennifer Arbittier Williams announced that Gongda Xue, citizen of China, was convicted after trial of charges related to his participation in a conspiracy to steal trade secrets from GlaxoSmithKline (GSK) pertaining to biopharmaceutical products under development from January 2010 to January 2016. Her sister and her associates pleaded guilty to IP theft.

 Gongda Xue worked as a scientist at the Friedrich Miescher Institute for Biomedical Research (“FMI”) in Switzerland, while hi sister, Yu Xue, worked as a scientist at GSK in Pennsylvania. Both conducted cancer research as part of their employment at these companies.   While working for their respective entities, the Xus shared confidential information for their own personal benefit.  Gongda Xue created Abba Therapeutics AG in Switzerland and Yu Xue and her associates formed Renopharma, Ltd., in China. Both companies intended to develop their own biopharmaceutical anti-cancer products. 

Xue's IP Theft Scheme

Renopharma received direct funding and support from the government of China.  Gongda Xue stole FMI research into anti-cancer products and sent that research to Yu Xue.  Yu Xue, in turn, stole GSK research into anti-cancer products and sent that to Gongda Xue.  Yu Xue also provided hundreds of GSK documents to her associates at Renopharma.  Renopharma then attempted to re-brand GSK products under development as Renopharma products and attempted to sell them for billions of dollars. Renopharma’s own internal projections showed that the company could be worth as much as $10 billion based upon the stolen GSK data. 

In January 2016, the FBI arrested Yu Xue and her Renopharma associates, seized e-mail accounts containing the stolen GSK data, and seized the funds in a Renopharma. Gongda Xue was charged in 2018 and extradited from Switzerland to the United States in December 2019. 

Yu Xue and Lucy Xi, pleaded guilty for their roles in sending GSK trade secrets to Renopharma.  Yu Xue's sister, Tian Xue, pleaded guilty to a money laundering conspiracy for agreeing to launder the substantial ill-gotten gains which Renopharma expected to receive.  One of the directors of Renopharma, Tao Li, also pleaded guilty for his role in conspiring to steal GSK trade secrets.  The other director of Renopharma, Yan Mei, is a fugitive who currently resides in China. 

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