Trade secrets in life science and pharmaceutical companies

Abstract

Trade secret protection arises under state common law and state statutes. In general, a trade secret is information that is not generally known to the public and is maintained as a secret, and it provides a competitive advantage or economic benefit to the trade secret holder. Trade secrets can be worth tens or hundreds of millions of dollars, and damage awards in trade secret litigation have been high; often, there is a lot at stake. Obtaining a trade secret through “improper means” is misappropriation. If the alleged trade secret, however, was developed independently, known publicly, or not maintained as a secret, then those defenses may successfully overcome a claim for trade secret misappropriation. With today’s interconnectedness in the biotechnology and pharmaceutical fields, more collaborations, joint ventures, and outsourcing arrangements among firms, and increased mobility of employees’ careers, life science companies need to not only understand how to protect their trade secrets, but also know how to defend against a claim for trade secret theft.