Only a couple of years ago, Elizabeth Holmes Theranos seemed to be the next great medical advancement. The startup was valued at billions of dollars and marketed as the future of medical testing. Then, the whole thing crumbled in days, as it was found its claims were false. And now, over two years after the first exposé on Theranos, the company is shutting down.
It was a slow but certain death for the Elizabeth Holmes Theranos venture, but it has finally happened. Last Tuesday, the Wall Street Journal released a letter from CEO David Taylor to shareholders. In it, he explains that the company will try to pay all unsecured creditors.
Investors reportedly lost around $1 billion in the biotech startup. And that’s only part of the disgrace. In June, the DoJ indicted Holmes and former Theranos COO Ramesh Balwani on charges of fraud. Holmes and Balwani are accused of scheming to defraud investors, doctors, government officials, and patients.
The two heads of Theranos heavily marketed for tests despite knowing they didn’t work. The original John Carreyrou article on Theranos was the first blow to the company. Once the lab received blood samples, they sent it to traditional labs to have them analyze them.
Elizabeth Holmes Theranos, a Fascinating Story
Theranos has become the poster child of what can go wrong with the startup model. In one year, Holmes went from being “America’s richest self-made woman” to being worth zero dollars. At first, Holmes denied all wrongdoing on the part of Theranos, even calling WSJ a “tabloid.”
Later, as accusations piled up, Holmes began changing her tune. Theranos and Holmes’ reputations took multiple hits, so she started speaking publicly. Notoriously, Holmes talked to Maria Shriver on Today saying she was “devastated” about the lab issues.
First, the Centers for Medicare and Medicaid Services (CMS) sanctioned Theranos. Later, the company lost its vital partnership with Walgreens, which offered in-store testing. Nobody seemed to believe Holmes was unaware of what happened on-lab.
The downfall of Theranos has turned into a page-turner. It was first published in book form by Carreyrou in May this year. Bad Blood: Secrets and Lies in a Silicon Valley Startup is on its way to becoming a film. The Big Short filmmaker Adam McKey will direct, from a screenplay by Shape of Water co-writer Vanessa Taylor. Jennifer Lawrence is attached to play Holmes.