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 laboratories and anatomic pathology groups. What is more notable about these top
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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.
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 about the agreement states that the anatomic pathology division, Boyce and Bynum Professional Services, Inc., and the
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 indictments of former CEO Elizabeth Holmes
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 about the potential for addition criminal charges to be brought in the case beyond those filed against CEO Elizabeth Holmes and former
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 to CEO and General Counsel David Taylor. Meanwhile, Theranos founder Elizabeth
CEO SUMMARY: In a tale of two fraudsters, the Department of Justice has filed a warning shot to all technology startups: Criminal indictments against Elizabeth Holmes and Ramesh “Sunny” Balwani could mean prison time and massive fines. In this latest Theranos news, The DOJ cited harm to investors, doctors and patients by the two company
CEO SUMMARY: Federal criminal indictments were unsealed last Friday in San Francisco against Elizabeth Holmes and Ramesh “Sunny” Balwani for their actions as executives at Theranos, Inc., the once high-flying lab test company. Officials at the Department of Justice said the counts against Holmes and Balwani are based on the alleged actions of each to
IT’S NOW CLEAR THAT TWO CLINICAL LABORATORY EXECUTIVES COMMITED one of the largest corporate fraud schemes in the past century.
Reading the federal indictments against Elizabeth Holmes and Ramesh “Sunny” Balwani unsealed Friday provides insights into the extensive scale and wide scope of the alleged fraud the two Theranos executives perpetrated against patients, doctors, and investors.
CEO SUMMARY: Reporting in The Wall Street Journal shows that some physicians in Arizona were concerned about the harm from erroneous test results from Theranos Inc. But those physicians who expressed concern may have been only a small set of the number of physicians who were worried about patient harm. After reviewing the concerns about
CEO SUMMARY: While Theranos was a darling of the business and national media, Wall Street Journal reporter John Carreyrou was hearing troubling reports about patients who got incongruent lab results that put them at risk for inappropriate medical treatments. His investigation of Theranos and its celebrated founder, Elizabeth Holmes, revealed that the company’s much-touted lab