There was a time when Theranos was one of the most-promising startups in the world, but now it’s having to fight off wave after wave of accusations that, should they prove to be true, will undoubtedly be fatal to the company. Business is already starting to suffer from these accusations, which claim that the company’s products don’t work as advertised, and that it lied through its teeth to convince people otherwise. In the most-recent accusations, two former employees claimed that Theranos actually deleted some of its quality control data to make its blood-testing technology look more accurate.
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.
