Elizabeth Holmes dropped out of Stanford at 19-years-old to found the $9 billion startup Theranos. Over the last six months the company has come under constant fire for what some believe are unethical and even dangerous business practices.
Now, a scathing report from the Centers for Medicare and Medicaid Services (CMS), is suggesting that things are about to get even worse for the company.
The FDA recently declared the company’s nanotube container for collecting blood from a finger prick to be an unapproved medical device. Then, CMS discovered serious deficiencies that forced a shutdown of Theranos’ Northern California lab.
Despite those fallbacks, and others, the company until last week managed to avoid peer-reviewed, independent testing that compares its product results to other diagnostic tools already available on the market.
Mount Sinai researchers showed that cholesterol results were an average of 9.3% lower than those conducted by reference labs. That’s enough of a bias that it could yield a false diagnosis for many patients.
The CMS report is significant, featuring 121 pages that revealed the company’s proprietary Edison device yields unacceptably inaccurate and highly erratic results for a significant number of critical blood tests.
Why this would surprise anyone at this point is beyond me. The company’s own chief scientist, Ian Gibbons, repeatedly told his wife Rochelle that “nothing was working” before he took his own life in 2013, according to the Wall Street Journal.
Problems are so bad at Theranos that CMS is considering pulling it’s lab certification, which would stop the company from operating online and out of Walgreen’s locations in Arizona.
Despite failed tests and wildly inaccurate results, Theranos continues to draw and test patient’s blood.
In the meantime, Theranos continues to defend its practices. You can see the company’s response to the CMS report and others here. If Theranos is good at anything, it’s making a big splash in the media to keep its business operations moving forward.