TAG:
Elizabeth Holmes
Elizabeth Holmes is the convicted former CEO at Theranos, a now-defunct blood test company.
Holmes was a charming and charismatic leader, poised to change the world of clinical laboratory testing. Her legacy, however, will instead be one of enamoring well-recognized investors with her personality while the technology behind her company ultimately proved lacking.
Her downfall was stunning. In 2014, Holmes was reported to have 18 U.S. patents and 66 non-U.S. patents in her name, and she was listed as a co-inventor on more than 100 patent applications. She was the youngest self-made female billionaire on the 2014 Forbes 400 list, with an estimated net worth of $4.6 billion. Yet by early 2016, Forbes updated her net worth to zero.
She founded Theranos in 2003 at age 19 while she was a chemical engineering major at Stanford University. She subsequently dropped out of Stanford as a sophomore to focus on her startup.
Theranos’ technology was based on her invention and patent for a way to run 30 common clinical laboratory tests on blood obtained via a fingerstick using microfluidics technology – a much faster and cheaper method than traditional lab testing techniques.
By 2014, the company offered 200 tests, was licensed to operate in every state in the U.S., and was valued at nearly $10 billion.
While some observers predicted Holmes’s innovations would dominate the clinical lab test market, an in-depth investigative report by The Wall Street Journal in October 2015 revealed aspects of Theranos that the secretive company has kept from public view. This reporting started the chain of events that would lead to Theranos’s downfall.
As a result of regulator scrutiny, in July 2016, the Medicare program handed down stringent sanctions to Theranos for problems at the company’s lab, including a two-year prohibition on Holmes owning any CLIA-certified laboratory.
Then, in March 2018, the U.S. Security and Exchange Commission (SEC) filed charges that focused on Theranos and Holmes allegedly raising more than $700 million from investors by exaggerating or making false statements about the company’s technology and financial performance.
To settle the SEC’s charges, Holmes agreed to pay a $500,000 fine and surrender almost 19 million shares of Theranos stock and voting control of the company, the SEC said. Also, she was barred from running a public company for 10 years. At the time, Holmes did not admit to nor deny the charges.
Later in 2018, the federal prosecutors charged Holmes on various counts of conspiracy and wire fraud charges. Following the indictments, Holmes stepped down as CEO. Theranos dissolved in September 2018.
Holmes went on trial in fall 2021 after multiple delays due to the COVID-19 pandemic and her pregnancy. On January 3, 2022, she was found guilty on three counts of defrauding investors and one count of wire fraud. She is scheduled to be sentenced in September 2022.
Important Court Rulings & Pending New Federal Law
IMPORTANT THINGS ARE HAPPENING WITH COURT DECISIONS AND PROPOSED FEDERAL LEGISLATION that will affect a substantial number of the nation’s clinical laboratories and anatomic pathology groups. In this issue of The Dark Report, you’ll be alerted to those developments we th…
Balwani Guilty! Sentencing Is Next for Theranos Execs
CEO SUMMARY: The trial of former Theranos President and Chief Operating Officer Ramesh “Sunny” Balwani ended with convictions by a jury on 12 counts of wire fraud and conspiracy. Now all eyes are looking ahead to the sentencing of Balwani and Elizabeth Holmes, the founder and fo…
Problems at Theranos Described in Balwani Trial
CEO SUMMARY: Former Theranos President and COO Ramesh Balwani is now being tried in federal court in San Jose, Calif. As with the earlier trial of Elizabeth Holmes, questions will arise about whether executives or clinical lab directors bear ultimate responsibility for lab test resu…
March 14, 2022 Intelligence: Late-Breaking Lab News
Telehealth proved to be popular with Medicare patients during the SARS-CoV-2 pandemic. The federal U.S. Department of Health and Human Services (HHS) reported telehealth visits for Medicare beneficiaries increased in 2020 by an incredible 63 times—from approximately 840,000 in 2019 to 52.7 m…
Jury Finds Elizabeth Holmes Guilty in Four of 11 Criminal Counts
THERANOS’ FOUNDER ELIZABETH HOLMES received four convictions out of 11 charges in her blockbuster trial, which likely means a federal prison sentence for the former CEO. The guilty verdicts arrived Jan. 3 after months of testimony and jury deliberations…
2021’s Top 10 Lab Stories Highlight Important Trends
This is an excerpt of a 3,075-word article in the December 20, 2021 issue of THE DARK REPORT (TDR). The full article is available to members of The Dark Intelligence Group. CEO SUMMARY: Much like 2020, the pandemic dominated our new list of the top 10 lab stories for 2021. Beyond…
2021’s Top 10 Lab Stories Confirm Important Trends
CEO SUMMARY: Much like 2020, the pandemic dominated our new list of the top 10 lab industry stories for 2021. Beyond COVID-19 testing, the virus crept its way into long-term trends, such as pathology jobs and technology innovation. New ways of delivering healthcare will need respons…
Theranos Lost $585 Mil. in 2015, Had Revenue of Just $500,000
AMONG THE BEST-KEPT SECRETS at Theranos during its glory days of 2013, 2014, and 2015—when the news media hailed now-disgraced founder and ex-CEO Elizabeth Holmes as a business genius to match Apple founder Steve Jobs—was the actual revenue the company was generating from its clinic…
In Theranos’ Trial, CLIA Laboratory Director Has a Starring Role
CEO SUMMARY: Most clinical lab directors understand the risks that come with running a CLIA-licensed lab. Such risks are at the forefront of the criminal trial of Elizabeth Holmes, founder of now-defunct Theranos. During the trial, federal prosecutors and defense attorneys question…
Third CLIA Lab Director Testifies in Trial of Elizabeth Holmes
SOMETHING NEW AND UNEXPECTED SEEMS TO POP UP EACH DAY in testimony taken during the federal criminal trial of Elizabeth Holmes, founder and ex-CEO of Theranos, the defunct and discredited clinical laboratory company. Last Thursday, a third indivi…
CURRENT ISSUE
Volume XXXI, No. 5 – April 8, 2024
The fragmentation of consumer markets is reflected in clinical lab services, and The Dark Report examines this trend and how it will impact labs in the coming years. Also, The Dark Report notes that the FDA has issued a controversial memo to reclassify many high-risk IVD assays.
See the full table of contentsHow Much Laboratory Business Intelligence Have You Missed?
Lab leaders rely on THE DARK REPORT for actionable intelligence on important developments in the business of laboratory testing. Maximize the money you make-and the money you keep! Best of all, it is released every three weeks!
Sign up for TDR Insider
Join the Dark Intelligence Group FREE and get TDR Insider FREE!
Never miss a single update on the issues that matter to you and your business.