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Theranos

Theranos was a blood analysis company founded by entrepreneur Elizabeth Holmes. The name is a combination of therapy and diagnosis. Holmes founded the company in 2003, dropping out of Stanford University as a sophomore to do so.

The company announced that it would leave the clinical laboratory business in 2016, after becoming the target of a major expose by the Wall Street Journal, CMS sanctions and numerous lawsuits. Its new stated business model is as a developer of medical devices.

Theranos claimed it could perform hundreds of laboratory tests using a finger stick collection and a micro-specimen vial instead of a needle and several vacutainers of blood, and return results in four hours for about half of the Medicare Part B lab test fees. This is exponentially less painful, faster and cheaper than conventional blood testing performed by clinical laboratories.

However, 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. Based on interviews with several employees and others with knowledge of events at Theranos, the WSJ disclosed that Theranos runs only a handful of tests using its proprietary technology, among many issues raised by the newspaper. Theranos quickly lost its role as the darling of the media.

In July 2016, CMS applied the most stringent sanctions it could to Theranos for problems it reported at Theranos’ Newark, CA lab, including a two-year prohibition on Holmes owning any CLIA-certified lab.

As a result of in-depth investigations, the Security and Exchange filed charges on March 14, 2019, stating that Theranos, Holmes, and Balwani raised more than $700 million from investors through an elaborate, years-long scheme that involved exaggerating or making false statements about the company’s technology, business, and financial performance.

To settle the SEC’s charges, Holmes agreed to pay a $500,000 fine and she agreed to 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. Balwani said he would contest the charges.

Three months later, the federal Department of Justice filed indictments against Holmes and Ramesh “Sunny” Balwani, charging each with two counts of conspiracy to commit wire fraud and nine counts of wire fraud.

Former Theranos Lab Director Makes News at Elizabeth Holmes Trial

This is an excerpt of a 1,867-word article in the October 18, 2021 issue of  THE DARK REPORT (TDR). The full article is available to members of The Dark Intelligence Group. CEO SUMMARY: During the trial, a pathologist who was a former Theranos lab director testified about the little…

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Pathologist Makes News at Elizabeth Holmes Trial

CEO SUMMARY: During the trial, a pathologist who formerly was CLIA lab director at Theranos testified about the little regard Theranos executives had for federal proficiency testing regulations labs must follow to retain their CLIA license. Another point of contention was how this p…

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September 27, 2021 Intelligence: Late-Breaking Lab News

Following the opening of her criminal trial in a Silicon Valley courtroom in recent weeks, Elizabeth Holmes—the disgraced ex-Founder and CEO of Theranos—continues to be the subject of news headlines. Federal prosecutors are calling witnesses to testify. Much of this testimony includes anec…

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August 16, 2021 Intelligence: Late-Breaking Lab News

Elizabeth Holmes, the disgraced ex-CEO of the now-defunct Theranos, continues to be in the news. In the past several weeks, news reports indicate that she gave birth to a child, but whether it is a boy or a girl has not been reported. Also in recent weeks, attorneys have been in court arguing …

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Judge Rules in Theranos Case, Elizabeth Holmes Again Is News

Attorneys for former Theranos CEO Elizabeth Holmes and former President Ramesh Balwani are in court maneuvering before the federal case starts the trial phase this summer. Last week, Judge Edward J. Davila ruled that prosecutors from the federal Department of Justice …

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Several Big Surprises in 2018’s Top 10 Lab Stories

CEO SUMMARY: This year’s list of the Top 10 Lab Industry Stories for 2018 is dominated by new directives from Medicare and private health insurers, as well as significant decisions by federal courts. Collectively, these developments create new compliance risks for all clinical laborator…

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December 3, 2018 Intelligence: Late Breaking Lab News

Another long-established regional laboratory company is about to be acquired. On November 27, Boyce and Bynum Pathology Laboratories of Columbia, Mo., disclosed that it had entered an agreement to be acquired by Quest Diagnostics Inc. Notably, the press release abou…

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Are More Criminal Charges Coming in Theranos Case?

CEO SUMMARY: As a going business, Theranos may have been dissolved in September, but it continues to be in the news. The biggest development was a disclosure in federal court earlier this month by federal prosecutors that there may be additional criminal charges to come that go beyond the…

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The Next Theranos News Could See More Criminal Charges

CEO SUMMARY: THE DARK REPORT has learned – before any other lab news resource – that in the latest in a long line of Theranos news stories, the U.S. Attorney is making statements ab…

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Theranos Will Dissolve, Seeks to Settle Claims

CEO SUMMARY: It appears that the final chapter in what many call Silicon Valley’s biggest investor fraud will conclude this week. Theranos, Inc., the once high-flying lab testing company, is to be dissolved and its remaining cash and intellectual property will be distributed, according …

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