We're starting to get into the details of what went on to entice the venture capitalists.
Our considered judgement thus far: What the hell?
From the Wall Street Journal:
Dec. 27, 2015 6:40 p.m. ET
Elizabeth Holmes’s blood-testing ambition has long collided with technological problems
The night before a big meeting with a Swiss drug company in 2008, Theranos Inc. founder Elizabeth Holmes and a colleague sat in a Zurich hotel, sticking their fingers with a lancet.
They drew drops of their own blood to try the company’s testing machine, but the devices wouldn’t work, says someone familiar with the incident. Sometimes the results were obviously too high. Sometimes they were too low. Sometimes the machines spit out only an error message.
After two hours, the colleague called it quits, leaving Ms. Holmes still squeezing blood from her fingers to test it again.
Ever since she launched Theranos in 2003 when she was 19 years old and dropped out of Stanford University, Ms. Holmes has been driven by ambition that is big even by Silicon Valley standards. Instead of a smartphone app to hail a car or order food, she wants to revolutionize health care with a vast range of diagnostic tests run with a few drops of finger-pricked blood.
Now 31, Ms. Holmes has emphasized a variety of strategies—a hand-held device, tests for drugmakers, drugstore clinics—while trying to turn her dream into a business. She often has collided with technological problems, according to interviews with more than 20 former Theranos employees, company emails and complaints filed with federal regulators.
In Switzerland, she went ahead and pricked her finger in front of a group of Novartis AG executives at the meeting the next day, testing for a protein that measures inflammation, says the person familiar with the incident.
All three of her Theranos devices flickered with error messages, the person says. Ms. Holmes was unfazed, blamed a minor technical glitch and continued to pitch the vast potential of her technology.
Ms. Holmes and several current or former Theranos directors declined interview requests. A spokeswoman for Theranos, Brooke Buchanan, says Ms. Holmes recalls only one machine with an error message, because someone tripped over the cord. A second machine ran perfectly, and the third wasn’t used, the spokeswoman says. A Novartis spokeswoman wouldn’t comment.
Since a Wall Street Journal article in October, Ms. Holmes has defended the Palo Alto, Calif., company’s laboratory work and promised to publish data proving the accuracy of its more than 240 tests, ranging from pregnancy to diabetes.
She said earlier this month that customer volume was higher than ever. The company has said it performed millions of tests, with highly positive feedback.
For now, though, Theranos has stopped collecting tiny samples of blood from patients’ fingers for all but one of its tests while it waits for the Food and Drug Administration to review the company’s applications for wider use of the small proprietary vials called “nanotainers.” As a result, Theranos is using traditional lab machines for most of its tests.
Many technology startups struggle to overcome problems while developing their products. Theranos has always faced an extra burden because blood tests sometimes provide life-or-death answers.
David Philippides, an engineer who worked on Theranos devices from January 2013 to November 2014, says the company didn’t show enough regard, based on his involvement in research while he was there, for the scientific rigor of medical research.
“The time was not taken to develop anything properly,” Mr. Philippides says. “This is science. You need time.” He says he was fired after refusing to go to Arizona to retrieve a broken machine.
The Theranos spokeswoman says he held only a “junior role” that gave him “no visibility into the extent of” the company’s research and development. She says the company employs more than 80 scientists with doctorates....MORE