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Theranos Faces Congressional Inquiry Over Faulty Blood Tests (techcrunch.com)
An anonymous reader writes: The U.S. House of Representatives sent a letter to blood analysis startup Theranos asking for them to explain their failure in providing accurate results to patients using its proprietary blood test technology. The company has faced serious backlash after government and regulatory agencies questioned the results of their proprietary 'Edison' machine, that the company claimed could detect hundreds of diseases using a single drop of blood. Not only have the feds proposed banning founder and CEO Elizabeth Holmes and the company president Sunny Balwani from the blood-testing business for two years, but Holmes' net worth has been cut from $4.5 billion to zero. Most recently, Walgreens decided to cut ties with the company. House Democrats Frank Pallone, Gene Green and Diana DeGette sent the letter on June 30th, asking Holmes to explain what went wrong, what steps the company is taking to help medical professionals and patients who might have been affected by the manipulated results, and how Theranos plans to comply with regulators. "Given Theranos' disregard for patient safety and its failure to immediately address concerns by federal regulators, we write to request more information about how company policies permitted systemic violations of federal law," reads the letter. Theranos says it plans to clear things up with these lawmakers.
First she was making it all about her, not about brilliant scientists, but about her her her. Second is that the stuff about her was all about how she is better than the rest of us. Admitted to the top university, gets up 2 hours before she goes to bed, works 28 hour days; basically all that in your face, I am better than you Type-A bullshit.
But the icing on the cake is that after she had raised funds from non-pharma types she just kept promoting. I could barely crack a science publication or a science section in any publication with her single drop of blood hype.
Where I am from the government is huge on being able to "pick a winner" so about twice a year I see the same micro-bubble that is hype hype hype with some front man, usually some vaguely good story about rubber that will make tires good for 300,000km. Then a nice line-up of vaguely important local investors. And just before it all blows up they are in some local business publication with the title "Top 40 under 40' or some other bullshit.
Then it all goes to hell, there are recriminations about government money in the toilet, a useless audit, and then it is forgotten as the latest batch of sure thing winners follow down the same path.
While all this is amusing/enraging; the worst part is that she has now made it nearly impossible for any legitimate company to actually do this research. If some real bio-researcher comes up with some blood tests needing only one drop they won't get one investor to take their calls or conferences to let them talk. They might as well work on cold fusion or herbal cancer cures.
What went wrong is they got caught. That's what "went wrong".
It is almost certainly more complicated than that. There is no way that a fraud like this could actually work in the long run, and any sensible investor would know that. What is more likely is that Elizabeth really thought her tech would work, hyped it to get capital, thus inflating expectations. Then she had too much pride to back down when the tech failed, so she started fudging a little, to buy time to fix the problems. But she couldn't fix the problems, so she then had a choice to either admit failure, and admit to the initial fudging, or ... dig deeper. Just like Bernie Madoff, she grabbed a shovel.