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NOWDiagnostics Faces Off With Biotech Rival In Trade Secrets Lawsuit

2 min read

NOWDiagnostics of Springdale, a developer of over-the-counter and point-of-care diagnostic tests, is embroiled in a trade-secrets lawsuit with a competitor that previously tried to merge with the company.

OraSure Technologies Inc. of Bethlehem, Pennsylvania, accused a former employee of taking confidential research with her when she joined NOWDiagnostics in August. Janean Young allegedly lied to OraSure about her new job for three weeks, during which time she continued to attend OraSure meetings, emailed protected information from her work account to her personal account, attended meetings and took advantage of her “high level access” to OraSure’s research and development department, according to a lawsuit filed by OraSure.

The company said the research represents years of work and millions of dollars in investments. Details of the research were redacted in the lawsuit, which was filed Nov. 14 against NOWDiagnostics in U.S. District Court for the Eastern District of Pennsylvania.

Both companies make lateral flow assay tests that detect biomarkers in human samples, such as saliva, blood and urine. In August, NOWDiagnostics received FDA approval to bring the first at-home, over-the-counter syphilis test to market. The test is among more than 30 in NOWDiagnostics’ clinical research pipeline. The company, founded in 2013, announced in July that it raised $22.5 million in Series B financing.

In a counterclaim filed Monday, NOWDiagnostics said it was actually OraSure that had misappropriated confidential information, and that Orasure’s lawsuit is a “last-ditch effort to thwart NowDx’s technological leadership in the diagnostics space, and to continue to conceal its own misconduct.”

The court filing said NOWDiagnostics shared trade secrets with OraSure as part of merger discussions in 2023. No transaction materialized, but OraSure allegedly used those trade secrets for research and development purposes. NOWDiagnostics said it learned about this from Young in an internal investigation prompted by OraSure’s lawsuit.

NOWDiagnostics accused OraSure of illegally retaining a prototype device, product roadmaps and technical documents, and proprietary data.

NOWDiagnostics also denied that it ever possessed any information or documents from the emails that Young sent to herself.

The companies have accused each other of violations of the federal Trade Secrets Act, breach of contract and unfair competition. They’re both seeking compensatory and punitive damages.

“We regret that previous discussions with OraSure have ended in litigation,” Robert Weigle, CEO of NOWDiagnostics, said in a statement. “However, we are confident in our legal position and plan to vigorously defend our innovative intellectual property.”

 

 

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