In 2003, 19-year-old entrepreneur Elizabeth Holmes founded medical technology company Theranos. Theranos claimed to have developed blood testing methods that used smaller amounts of blood and took less time to analyze samples than regular blood test methods. Specifically, Holmes claimed that Theranos’ technology could analyze data with just a few drops of blood from a finger prick. Through her connections with influential public figures such as Henry Kissinger, Rupert Murdoch and Betsy DeVos, Holmes brought Theranos’ value up to $9 billion by 2014. A year prior, Theranos was brought to the public eye through a partnership with Walgreens.
Holmes became notable for her peculiar appearance: she spoke in a baritone voice, stared unblinkingly at cameras during interviews and always wore Steve-Jobs-esque black turtlenecks and slacks. She was featured on the covers of magazines Fortune, Forbes, T: The New York Times Style Magazine and Inc, where she was lauded as the world’s youngest self-made female billionaire.
However, this boom of fame and money was built on rocky foundations. In October 2015, John Carreyrou of The Wall Street Journal published an extensive story on Theranos. In this report, former Theranos employees claimed that the company had exaggerated the capability of their technology.
One part of the report details a proficiency test in 2014 that Theranos was required to go through to “prove to the federal Centers for Medicare and Medicaid Services that they can produce accurate results.” Samples at Theranos were tested in two halves: one on Theranos’ own Edison machines, and one with machines from other companies.
The machines gave different results “when testing for vitamin D, two thyroid hormones and prostate cancer.” When senior lab employees showed the results to chief operating officer Sunny Balwani, they were told that the “samples should have never run on Edisons to begin with.” Theranos then reported the results given by machines from other companies, not their own. The business was reportedly using the Edison machines for regular patient tests for vitamin D, the two thyroid hormones and prostate cancer.
Indeed, the majority of Theranos’ tests were done on machines from other companies. In some cases, the “few drops of blood” were diluted to increase their volume, which caused the inaccurate test results. Other tests were done with larger samples drawn from patients’ arms — not much of a “fingertip.”
In 2016, the Centers for Medicare and Medicaid Services inspected a Theranos lab in Newark, California, and uncovered problems with staff proficiency, procedures and equipment. This led to a two year ban on Theranos’ operations. Walgreens also suspended its partnership with Theranos.
In 2018, Holmes and Balwani were charged with fraud by “raising more than $700 million from investors through an elaborate, years-long fraud in which they exaggerated or made false statements about the company’s technology, business and financial performance.” Holmes was removed from the CEO position, though she remained on the company’s board. By September 2018, Theranos announced that it was ceasing operations.
The case of the U.S. v. Elizabeth Holmes, et al. finally reached the courtroom on Aug. 31, after being delayed due to the pandemic and Holmes’ pregnancy. Holmes’ trial is currently taking place, while Balwani’s trial will begin in January. Both are being charged with two counts of conspiracy to commit wire fraud and nine counts of wire fraud. If convicted, they face a maximum sentence of 20 years in prison and a fine of $250,000 (plus restitution) for each of the 11 total counts. Both have pleaded not guilty.
All of that is undeniably bad. The false promises made by Holmes and Theranos affected the lives of every patient whose blood was analyzed with the Edison machines. A potential witness in the Holmes trial, Maureen Glunz, received a blood test result from Theranos that showed levels of glucose, calcium, protein and liver enzymes that were so high that her doctor sent her to an emergency room. When Glunz reported these results, five Theranos employees called her, drilling her about her emergency room visit and her preexisting health conditions. “The questions they were asking me made it sound like it was my fault,” Glunz said in a recent interview with The Wall Street Journal.
Court documents from Sept. 4 reveal that Holmes might accuse Balwani of mental and sexual abuse during her time at Theranos. The two shared a relationship from 2003 to at most 2016, and former employers have said Balwani “enforced a corporate culture of secrecy and fear,” “disappearing” employees who displeased him.
“Mr. Balwani encouraged her to leave school and pursue (Theranos),” said Holmes’ attorney Lance Wade in his opening statements. “In this case, you’ll learn that certain aspects of that relationship had a big impact on Ms. Holmes.”
I’m no stranger to the effect abuse and toxic relationships can have on a person’s psyche. I would never wish the anxiety and shame of relationships like that on another person, and I would normally discourage shaming abuse victims for taking their time to speak up about their abuse publicly. But the timing of these accusations, and the way they’re being used to frame Holmes’ defense, seems much too convenient to me.
Yes, Holmes certainly could have been influenced by her relationship with Balwani. When they met, she was 18 and he was 37. It is very easy, as an impressionable teenager cresting adulthood, to latch on to a seemingly successful adult who wants a relationship with you and take their word as gospel. It is very easy to make foolish decisions when you are young. But “foolish” doesn’t quite cover the depth of what Holmes has done.
Again, people’s health was placed in Theranos’ hands, and no matter what the underlying circumstances of Holmes’ mental health were, the fact remains that Theranos’ patients were lied to and harmed by her actions. Both Holmes and Balwani deserve to be brought to justice for their actions, and for the harm those actions have brought to those they were supposed to be helping.
Categories: Opinion
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