WuXi PharmaTech speaks out on compound theft by former employee

As Chinese business leaders work hard to curtail intellectual property theft in the country, WuXi PharmaTech ($WX) is reaffirming its commitment to IP security after the conviction of a former employee who stole Merck ($MRK) compound samples last year. 

According to The Wall Street Journal, a Shanghai court handed Wang Hui a sentence that is the equivalent of 18 months probation and ordered him to pay around $7,000 in restitution for stealing samples of two compounds in Merck's research pipeline and attempting to sell them over the Internet. Merck, WuXi and local law authorities were able to thwart the deal and the compounds were eventually recovered, successfully stopping what WuXi describes as the only known incident of its kind in the company's 11-year history.

On Monday, WuXi released a statement. While the CRO expressed regret over the one-time incident, it remained firm with its "stringent" IP protection policy. "The strong and trusting customer relationships we have built over the past 11 years are based in part on our culture of commitment to IP security," said WuXi Chairman and CEO Ge Li. "As in any company, there will always be the risk of damage caused by a determined criminal."

As Li reaffirms, WuXi isn't the first company to see such a breach in protocol. Earlier this year, former Sanofi ($SNY) chemist and Chinese national Yuan Li pleaded guilty to a charge of stealing information about experimental compounds and then putting the compounds up for sale by a subsidiary of a Chinese chemical company. As an article from The Economist points out, Chinese businesses are working hard to stop IP theft across national industries, but still have a long way to go. And as lawyer Lewis Ho tells the WSJ, examples of what WuXi went through will likely increase as foreign countries turn to China to boost biotech and pharma production.

In light of the breach, WuXi announced that it is undertaking a review to strengthen IP security measures and intensify employee training.

- read the WuXi release
- get Pharmalot's take
- see more from the WSJ

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