The New York Times reports: Elizabeth Holmes, Founder of Theranos, Falls From Highest Perch Off Forbes List.
I've been seeing articles on Ms Holmes for the last year or so. She claims to have technology which allows blood tests using a finger prick of blood rather than multiple vials. She dropped out of college to start a company to develop her new technology. The company is one of the "unicorns" often talked about -- private startup companies valued at over a billion dollars.
For the last 6 months the company has come under criticism and has had a lot of bad press. There are claims that the company's tests are inaccurate and that they are using conventional blood testing machinery for many of the tests. On the business side the company board of directors apparently doesn't include medical experts.
So is Theranos a scam? A new technology which didn't pan out? The company hasn't provided peer reviewed data on its technology, and the reports so far indicate that at the very least they are having trouble getting the product to market, not unexpected for a new technology.
Yet there is another aspect to this story. There are several very large players (existing labs, existing producers of blood testing equipment) who stand to lose a lot if Theranos' technology pans out. All of medicine is also highly regulated. Regulatory agencies are not known for their flexibility or acceptance of anything new. So the question arises -- how big is the real problem at Theranos and how much of the problem is the inability of regulatory agencies to deal with change?
Time will tell. My feeling right now is that Elizabeth Holmes really did have a new technology but that it's hit some snags (or doesn't work well enough). Investors have put $700 million into the company and they'll probably have a hard time raising more money, especially with the bad press. Hopefully we won't lose a promising new technology to bureaucratic incompetence or lack of funding to deal with unexpected problems.