COLUMBUS, Ohio – A former Dublin, Ohio couple has been charged with crimes connected to stealing exosome-related trade secrets concerning the research, identification and treatment of a range of pediatric medical conditions.
According to the indictment, Yu Zhou, 49, and Li Chen, 46, currently of San Diego, Calif., conspired to, attempted to and did steal scientific trade secrets related to exosomes and exosome isolation from Nationwide Children’s Hospital’s Research Institute for their own personal financial gain.
The defendants were arrested in California in July and the case was unsealed today at the defendants’ arraignments in federal court in Columbus at 2pm before U.S. District Judge Sarah D. Morrison.
Zhou and Chen are spouses who worked in separate medical research labs at the Research Institute for 10 years each (Zhou from 2007 until 2017 and Chen from 2008 until 2018). Exosomes play a key role in the research, identification and treatment of a range of medical conditions, including necrotizing enterocolitis (a condition found in premature babies), liver fibrosis and liver cancer.
The husband and wife allegedly founded a company in China in 2015 without the hospital’s knowledge. While Zhou and Chen continued to be employed by Nationwide Children’s, they marketed products and services related to exosome isolation through their Chinese company.
The indictment also alleges that in 2017, Zhou helped co-found an American biotechnology company. As of 2019, the company’s website advertised multiple products and services related to exosome isolation, including a kit that was developed from a trade secret created at a Nationwide Children’s research lab.
Zhou and Chen allegedly used the hospital’s Research Institute resources and equipment to conduct the exosome research for their unauthorized, outside work.
In November 2017, Zhou and Chen allegedly received more than $876,000 and stock related to an asset purchase agreement involving the American biotechnology company. It is also alleged Zhou entered into a stock purchase agreement with that same company under which he would receive $450,000.
Zhou resigned from the Research Institute at Nationwide Children’s, effective November 10, 2017. On January 31, 2018, Chen resigned from her position at the research institute.
Before his official last day of employment with the research institute, Zhou allegedly participated in a press release announcing the American company’s plans to market and distribute “proprietary exosome isolation systems” from its headquarters in Central Ohio.
Conspiring to, attempting to and committing theft of trade secrets is punishable by up to 10 years in prison. Conspiring to, attempting to and committing wire fraud carries a potential maximum sentence of up to 20 years in prison.
