US prosecutors say corrupt Chinese officials behind Glaxo pharma secrets theft, but defence says that’s ‘fantastical’

US federal prosecutors alleged Wednesday that corrupt officials in the Chinese government financially supported and may have benefited from a scheme to steal trade secrets worth billions from a GlaxoSmithKline research facility in Pennsylvania.

But lawyers representing one of the five defendants accused of pilfering information from the British-based pharmaceutical giant’s Upper Merion Township location called such claims a “fantastical assertion”.

The dispute — which boiled over at a detention hearing in federal court in Philadelphia — struck at the heart of debate over the Justice Department’s recent chequered history in prosecuting cases of alleged theft of trade secrets involving Chinese American scientists.

Accusing the government of grossly exaggerating the stakes, defence lawyer John N. Joseph pointed to that mixed record in arguing for his client’s release.

“It wouldn’t be the first time the government has sat in this courtroom citing overwhelming evidence in a trade-secrets case only to withdraw the charges before trial,” he said.

The Obama administration has accused Chinese spy agencies of encouraging their nation’s businesses to steal trade secrets from American corporations, and made stanching that flow a priority. But several recent high-profile blunders have caused critics to label the accusations as racial hysteria reminiscent of the red scares of the 1950s.