Elizabeth Holmes, the latest Silicon Valley visionary to adopt the black turtleneck uniform of business tycoon Steve Jobs, takes the TEDMED stage on November 7, 2014. Her vision is to “redefine the paradigm of diagnosis… to one in which every person, no matter how much money they have or where they live, has access to actionable health information at the time it matters.” She fumbles in a black blazer pocket for a tiny tube, a nanotainer, a piece of her company’s patented technology that she says is revolutionizing blood testing.

Yet just a year later, public opinion of Theranos begins unraveling after over a decade of positive press and glowing profiles. In October, John Carreyrou of the Wall Street Journal publishes his first in a series of investigative pieces — and closer inspection isn’t turning up anything good. The year gets worse when the Centers for Medicare and Medicaid Services (CMS) issue a letter in early 2016 detailing Theranos’ non-compliance with regulatory standards, immediately suspending services from Theranos’ Newark lab due to safety concerns.

Despite the seriousness of the deficiencies for which Theranos has been cited, these failings are commonly seen among start-ups and, if they can be addressed, do not portend Theranos’ demise. However, the worrying absence of sound, scientific evidence that their technologies work casts doubt on the company. How were their operations, bolstered by trust and Holmes’ charisma instead of science, allowed to go forward?

The Rise

In 2003, Holmes dropped out of a chemical engineering program at Stanford University to develop a technology for monitoring blood analytes and delivering medication. Over the next few years, Holmes secured over $400 million from investors and began hiring staff to help further her research on obtaining meaningful information from tiny volumes of blood. Eventually, this research resulted in the development of Theranos’ technological lynchpin: the Edison machine. According to Holmes, the Edison machine is able to perform common blood tests on the few drops of blood obtained from a finger prick. Citing fears of competition, Holmes remained tight-lipped about this proprietary technology, even though her silence hindered her ability to secure additional venture capital.

By 2012, buzz about Theranos grew and the charismatic Holmes did the media rounds. She was lauded by the Silicon Valley tech media as a youthful revolutionary poised to overturn the landscape of medical testing in the US. The mainstream media caught wind of Theranos and gamely began reporting this scientific “success story” to the general public.

In 2013, Theranos partnered with the American pharmacy giant Walgreens and began offering a menu of blood tests. They set up “Wellness Centers”, designed with comfort in mind. These centers were relaxing and accessible, offering tests at a fraction of the cost of other diagnostic testing companies. In a country where health-care costs can quickly run your bank account into the red, Theranos was making it easier and more affordable to get blood tests done. By 2015, the public opinion of Holmes was at its zenith and Forbes listed Holmes as the world’s youngest female billionaire, valuing Theranos at $9 billion. Theranos actively sought out FDA approval for test protocols, and in July of 2015, one of their protocols testing for antibodies against Herpes simplex virus 1 was approved; the regulatory status of the other tests submitted for approval has not yet been released.



The Fall

Theranos’ good press couldn’t last forever. In 2015, John Carreyrou, a two-time Pulitzer-winning investigative reporter from the Wall Street Journal, began looking into the company. In order to get approval to begin operations, the company had to show CMS that their testing methods produced accurate results. The company was provided with test samples, which employees split in two and ran in parallel on traditional machines and Edison machines. However, discrepancies between the results from traditional machines and the Edison machines seemed to suggest that the Edison machines were not producing accurate results. When the employees brought these concerns to top executives, they were reprimanded and told to submit results from purchased industry-standard machines only. As a result, the proprietary Edison machines never truly passed federal certification. This did not stop Theranos from using them for some of their tests until a CMS report detailing the repeated failures of the Edison machines was released in the fall of 2015, leading the company to void two years’ worth of test results.

Despite Theranos touting the Edison machines as what set them apart from other testing companies, former employees reported that only 15 of the offered 240 tests were run on the Edisons. The remaining tests were run on traditional lab equipment using blood from venous draws or by diluting samples collected from fingerpricks, a protocol that could reduce the concentration of the substance being analyzed below a level that could be accurately measured. So while an article published in the Journal of Clinical Investigation this year found that Theranos’ results were within an acceptable range of variability and comparable to those from other diagnostic labs, the murkiness surrounding how Theranos has been doing their testing makes it impossible to tell if other tests performed by Theranos were also conducted in a way that would provide valid results. With stiff sanctions, a criminal probe, and a possible industry-wide exile of Holmes hanging over Theranos, Holmes made a last-ditch effort to appease the people questioning Theranos’ science. She and some of her team presented their science at an AACC meeting. But rather than showing the platform from which they have been operating, they showed a new machine and data from venous blood draws, not fingerpricks.


[F]ears of competition should not be allowed to trump the requirement for thorough, unbiased, and transparent assessment of new technologies.”


Elizabeth Holmes’ vision of providing access to affordable “actionable health information” has fallen short. By hiding under the guise of “professional secrecy”, Theranos was able to cut corners with the scientific community, providing inaccurate and potentially dangerous test results to its consumers. Overall, this experience serves as a lesson that fears of competition should not be allowed to trump the requirement for thorough, unbiased, and transparent assessment of new technologies. When people’s health could be put at risk by faulty results, they have a right to know that these technologies are working as advertised.

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Heather MacGregor

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