Theranos is a blood testing company that incorporates microfluidic devices for cheaper blood tests and is valued at about $9 billion. The company claims that they can run several tests with one drop of blood. Incredible, isn’t it? Just a few months ago, Fortune magazine featured founder Elizabeth Holmes on their cover, and people everywhere started talking about it. The story is an inspirational story: Holmes dropped out of Stanford in second year to found Theranos, which she believed could revolutionize health care technology. In her words, she founded Theranos “because systems like this could completely revolutionize how effective health care is delivered. And this is what I want to do. I don’t want to make an incremental change in some technology in my life. I want to create a whole new technology, and one that is aimed at helping humanity at all levels regardless of geography or ethnicity or age or gender.” Rapidly, the charismatic Holmes became a Silicon Valley celebrity and a powerful voice for women in STEM, inspiring girls to pursue their dreams in STEM and encouraging women to help other women. However, in recent weeks, Theranos has gotten itself into hot water and is starting to fall as quickly as it rose.
Theranos’ problems started on October 15, 2015, when the Wall Street Journal ran an exposé of Theranos. The WSJ accused Theranos of not using its own technology to run most of the tests, questioned the accuracy of the blood tests’ results, and implied that Theranos cheated on lab proficiency tests. Holmes responded to the allegations saying in an interview that she was shocked that the Journal would make such claims and that she had sent a thousand pieces of documentation proving the them false. “This is what happens when you try to change things,” said Holmes. “First they think you’re crazy, then they fight you and then all of a sudden you change the world.”
The next day, the Wall Street Journal published a report that the U.S. Food and Drug Administration (FDA) pressured Theranos into halting its collection of blood via finger pricks for all but one of its tests, as well as the use of the company’s ‘nanotainers,’ which were deemed unapproved medical devices. Theranos later released a statement saying that the facts were misconstrued, and that they have been working with the FDA proactively. A couple days later, Jean-Louis Gassé, the head of Apple engineering during the 1980s, wrote that the results of his blood test with Theranos was significantly different from the traditional blood test taken from Stanford Hospital.
On October 21, Holmes was interviewed by John Carreyrou, the journalist for the WSJ who ran the exposé on Theranos. She again disagreed with the claims and insisted that the exposé was false. Two days later, Theranos’ woes continued to grow, when the Financial Times raised new questions regarding the accuracy of Theranos’ tests and took issue with an earlier New Yorker profile of Holmes stating that she had “earned income from large pharmaceutical companies.” The next day, Walgreen’s, who has a deal with Theranos and had begun opening Theranos wellness centres, announced that they would not be opening any more Theranos centres until the controversy has passed.
Theranos’ problems only continue to escalate from there. On October 27, the FDA published two lab inspection reports, finding the nanotainers to be ‘uncleared medical devices’, and that Theranos had poor record keeping, mishandled complaints, and missing quality audits. Theranos then gave a very ambiguous response, saying, “We believe that we addressed and corrected all the observations at the time of, or within a week of, the inspection and have submitted documents to FDA that say so.” Another problem with Theranos is that none of its data has been peer-reviewed, although, according to their website, all their technology has been “vigorously tested.” Dr. John Ioannidis of the Stanford Prevention Research Centre says, “I applaud their going to the FDA for approval on so much and hope other labs will follow their example, but their results need to be checked out (by the broader scientific community in peer reviewed journals). Is it reproducible in the scientific community? This is a major deficiency. We have been misled many times about innovations in medicine before.” Why hasn’t Theranos allowed peer-reviewal until now? They claim that as any good business would, they need to keep their technology secret from their competitors.
The Theranos story is far from over and there is no clear ending in sight. Theranos could prove critics wrong and revolutionize the healthcare industry, as their charismatic leader Elizabeth Holmes aims to achieve. Or, Theranos could continue to fall until it crashes and burns, if it is found that their technology doesn’t work. The one thing that is certain is that Theranos will not go down without a fight, and that we will continue to hear about Theranos for a while.
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