It sounded like a good idea.
It sounded like a great idea: one simple blood test that required a single finger prick would give “everyday Americans unlimited control over their health,” The New York Times writes (Mar. 15).
The key promise Theranos founder Elizabeth Holmes made to investors and potential clients: “that drawing a tiny amount of blood at a time from each patient’s finger,” Wall Street Journal reporter John Carreyrou described in 2015, “…will lead to earlier diagnoses and save lives.”
Sadly, it was not to be.
Holmes was not as cocky or social media-loathsome as Martin Shkreli, not by a long shot. However, like the Pharma Bro, she was considered a whiz-kid “with her invention: a technology cheaply done at a local drugstore that could detect a range of illnesses, from diabetes to cancer.”
With her on-stage presence and black turtlenecks, Holmes was often compared to Apple genius, Steve Jobs.
“On Wednesday,” The Times continues, “the Securities and Exchange Commission charged Ms. Holmes… with widespread fraud, accusing her of exaggerating — even lying — about her technology while raising $700 million from investors.”
The magic that was Holmes began to unravel after a series of stories by Investigative Reporter John Carreyrou.
“One former senior employee,” Carreyrou wrote in 2015, “says Theranos was routinely using the device, named Edison after the prolific inventor, for only 15 tests in December 2014. Some employees were leery about the machine’s accuracy, according to the former employees and emails reviewed by The Wall Street Journal.
“In a complaint to regulators, Carreyrou adds, “one Theranos employee accused the company of failing to report test results that raised questions about the precision of the Edison system. Such a failure could be a violation of federal rules for laboratories, the former employee said.”
After the Journal story, Holmes admitted to employees “that its vaunted core technology was actually faulty and that Theranos administered almost all of its blood tests using competitors’ equipment,” Vanity Fair wrote (Sept. 6, 2016).
“The charges were brought against Theranos,” the BBC News reports (Mar. 14), “and its former president Ramesh ‘Sunny’ Balwani as well as Ms. Holmes….
“The regulator alleged that Theranos, Ms. Holmes and Mr. Balwani made a series of false and misleading statements in investor presentations, product demonstrations and interviews.
“It said: ‘Theranos, Holmes, and Balwani claimed that Theranos’ products were deployed by the US Department of Defense on the battlefield in Afghanistan and on medevac helicopters and that the company would generate more than $100m in revenue in 2014.
“ ‘In truth, Theranos’ technology was never deployed by the US Department of Defense and generated a little more than $100,000 in revenue from operations in 2014…
“ ‘In truth, according to the SEC’s complaint, Theranos’ proprietary analyzer could complete only a small number of tests, and the company conducted the vast majority of patient tests on modified and industry-standard commercial analyzers manufactured by others.’ ”
As for Journal reporter Carreyrou, he’s got a much-anticipated book version of the story, entitled Bad Blood, due to hit bookshelves later this year, and… Jennifer Lawrence is set to star in the film version.