Ohio Researcher Admits Selling Secrets to China

An American researcher has admitted stealing scientific trade secrets from a children's hospital and selling them to China.

Former Ohio resident Li Chen pleaded guilty yesterday to conspiring to steal scientific trade secrets and conspiring to commit wire fraud concerning the research, identification, and treatment of a range of pediatric medical conditions. 

Chen and her husband, alleged co-conspirator Yu Zhou, 49, worked in separate medical research labs at the Nationwide Children's Hospital's Research Institute for 10 years each (Zhou from 2007 until 2017 and Chen from 2008 until 2018). 

The couple were arrested in California in July 2019 and charged with conspiring to steal at least five trade secrets related to research on the cellular components known as exosomes. 

Known to facilitate cell-to-cell communication, exosomes play a key role in the research, identification, and treatment of several medical conditions, including liver cancer and necrotizing enterocolitis, that can affect premature babies.

Chen conspired to steal and then monetize one of the trade secrets by making and selling exosome “isolation kits.” The 46-year-old then set up a company in China to sell the kits. 

In return for the secrets, Chen received benefits from the Chinese government, including from the State Administration of Foreign Expert Affairs and the National Natural Science Foundation of China.

The US Department of Justice said: "Chen also applied to multiple Chinese government talent plans, a method used by China to transfer foreign research and technology to the Chinese government."

As part of her plea, the once trusted researcher has agreed to forfeit approximately $1.4m together with 500,000 shares of common stock of Avalon GloboCare Corp. and 400 shares of common stock of GenExosome Technologies Inc.

US attorney David DeVillers commended the cooperation of the research institute throughout the investigation into the thefts.

“Nationwide Children’s Hospital’s Research Institute took reasonable measures to protect its cutting-edge intellectual property and trade secrets regarding exosomes," said DeVillers.

“Chen betrayed her employer of 10 years by stealing trade secrets from this American institution and transferring them to China after receiving payments from the Chinese government.”

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