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Theranos To Close Shop (cbsnews.com)

Posted by BeauHD on from the case-closed dept.

Major Blud writes: Multiple news outlets are reporting that Theranos, the company that promised to revolutionize healthcare with new blood-testing devices, is closing shop. The company "was unable to sell itself and is now looking to pay unsecured creditors its remaining cash of about $5 million in the upcoming months," reports CBS News. The CEO, Elizabeth Holmes, and President/COO Ramesh Balwani recently settled a civil suit with the SEC, which charged them with massive fraud related to them seeking investment based on misleading information regarding the accuracy of their "Edison" diagnostic equipment. According to The Wall Street Journal, investors lost almost $1 billion in the company. At one point, it was valued at almost $10 billion.

8 of 107 comments (clear)

  1. Deeply sadenned... by Anonymous Coward · · Score: 4, Funny

    I wish the investors lost the full $10B...

  2. Elizabeth Holmes should be in prison by Anonymous Coward · · Score: 5, Interesting

    She knew she didn't have a viable product, and willingly defrauded investors. Whenever someone on her team approached her with concerns about their approach or strategy, she sidelined or fired them. She was not a leader, she was a charlatan and a crook.

  3. Good luck with that by rsilvergun · · Score: 4, Interesting

    here in America we don't spill the blood of kings, and she was very well connected with the American equivalent of royalty.

    --
    Hi! I make Firefox Plug-ins. Check 'em out @ https://addons.mozilla.org/en-US/firefox/addon/youtube-mp3-podcaster/
    1. Re:Good luck with that by tsqr · · Score: 4, Informative

      Elizabeth Holmes and Ramesh Balwani have been indicted for conspiracy to commit wire fraud against investors, conspiracy to commit wire fraud against doctors and patients, plus 9 additional counts of wire fraud. They are both facing serious prison time.

  4. Investors had very little knowledge of technology. by Futurepower(R) · · Score: 5, Informative

    The investors in Theranos were an example of people being extremely ignorant of technology. Someone who understood would ask a few questions and immediately determine something was wrong.

    An example of someone who asked a few questions in 2013: Bill Maris: Here's why Google Ventures didn't invest in Theranos (Oct. 20, 2015 article)

    Quote:

    "We looked at it a couple times, but there was so much hand-waving -- like, Look over here! -- that we couldn't figure it out," Maris tells Business Insider. "So, we just had someone from our life-science investment team go into Walgreens and take the test. And it wasn't that difficult for anyone to determine that things may not be what they seem here."

  5. She's already been criminally indicted by JoeyRox · · Score: 4, Informative

    Her trial is scheduled to start later this year.

    https://www.justice.gov/file/1072521/download

  6. What about people who got "tested"? by StandardCell · · Score: 4, Insightful

    There were a lot of people whose blood work went through this scam and may have had all sorts of false negatives that caused them harm or death.

    While I sympathize with the investors, its the patients that I feel far more sorry for. You can work another day to make another dollar. You can't undo the type of harm that false blood tests can create.

  7. Re:Investors had very little knowledge of technolo by N7DR · · Score: 4, Interesting

    The investors in Theranos were an example of people being extremely ignorant of technology.

    I am too-often amazed at how so many VC firms don't really seem to understand the technologies at which they are throwing money.

    One case in point (there are plenty of others I know of): a few years ago I watched a presentation of a cybersecurity company that had received a $40m investment from a VC firm. I happened to make a comment to a colleague after the presentation to the effect that the product was snake oil (which was the conclusion he had reached as well), and was immediately asked what I meant by someone who was listening... who was from the VC firm that had made the investment. A couple of weeks later, the VC firm flew me to talk to the company executives in their presence. The company shut down the next day. So the VC firm saved themselves from throwing away more money, but I never understood why they had given $40m to the company without bothering to get any independent input about the technology. It was hard to escape the conclusion that "cyber", "security" and a lot of waffling and some pretty slides were more important than getting answers to hard questions.