Highly enjoyed Bad Blood and recommend it to anyone interested in some fine investigative journalism.
I think the most disappointing thing about this whole saga is that (in theory) the Theranos technology was supposed to be a major healthcare game changer. It could have revolutionized testing, and would surely have saved countless lives.
> think the most disappointing thing about this whole saga is that (in theory) the Theranos technology was supposed to be a major healthcare game changer. It could have revolutionized testing, and would surely have saved countless lives.
This reads like such a weird statement. It never existed. It could’ve never have revolutionized testing because it was entirely imagined and not based on reality.
It’s like watching Star Trek thinking tricorders are real then being disappointed when told they’re a fiction.
So, I’m one of Theranos’ biggest critic, since I’ve had a weird fascination with the company since someone on HN pointed out the bizarreness of its BoD back in 2013.
I think if Theranos hadn’t gone all-in on its fraud it still could have had an impact. One area was that it was actually pushing to change laws (I know it did this in Arizona) to give individual control over blood testing instead of requiring people to go through doctors and corporations. Another area was price transparency. Much like the Surgery Center of Oklahoma (https://surgerycenterok.com), it was listing all the prices for its tests right there on its website. These 2 things alone would be a major advancement in the US. Forget the mini blood tubes.
The law change for direct access to lab ordering and results is really independent of Theranos. HHS changes rules in 2014 to allow patient access [0] that goes back almost 20 years.
It’s also not clear that it’s a good thing; false positives lead to serious negative consequences which is why tests aren’t ordered in the first place. It’s why you don’t get a colonoscopy at 25: chance_of_false_positive * harm_of_false_positive > chance_of_detection * treatment_success until much later in life. You as an individual are not qualified to make that aggregate decision.
I thought the individual having control (and choosing to use Theranos) was a bad thing, no?
When you're buying one blood test you won't be able to tell what it missed. If you're a medical practitioner, ordering hundreds of blood tests per month (or something) you can afford to duplicate the test when you change testing provider and realise that they aren't doing a very good job!
Except that most practitioners are bound to use a single lab and then run as many tests as they have to do cover regulations and insurance. Then to boot you have no idea what they'll cost until you get the bill later.
> This reads like such a weird statement. It never existed. It could’ve never have revolutionized testing because it was entirely imagined and not based on reality.
A whole lot of things we have today were inspired by Star Trek and didn't exist... until they were made to exist. The fault in Theranos was that they sought to make things exist by innovation on a time table, and when the time table didn't work, covered it with fraud to make the deadline.
Honestly, fuck Elizabeth Holmes and her weird ass advisors. There was so much potential here that was squandered for the sake of her ego and paranoia.
If some company was founded on tricorder technology and convinced a lot of people it was real, then it turned out it was a scam and tricorders aren’t real, isn’t it reasonable to be disappointed?
I think it's the wording that's being commented on. Maybe it's just semantics. I think the word 'disappointed' implies that there was an honest effort that didn't end up panning out (say, if the company ran out of money, or misunderstood product/market fit and fizzled, or got out-competed). I am not sure what a more appropriate phrasing would be for a fantastical idea that never existed in any form and never could have.
Believe in something. Even if it means sacrificing everything. Especially investor's money, because that's what it's there for. Except when it comes to lives and health of other people. Make no compromises there, no sacrifices.
> Except when it comes to lives and health of other people. Make no compromises there, no sacrifices.
I have not read the book, but based on the author’s interviews I have to agree with the idea that fake it ‘till you make it should never be applied to the medical space.
When Theranos went live in Walgreens they crossed a line where limitless ambition should never be an excuse for vaporware. If accountability is at all an American standard, then Holmes should be prevented from ever being an executive in the health space. People’s lives were endangered. There is no excuse. Blood tests are not some b2b SaaS customer dev experiment.
> If accountability is at all an American standard
That's your problem right there. I see no evidence (from the perspectives of politics, business, religion or any other angle I can think of) that Americans actually care even a tiny bit about accountability. They're perfectly happy to say they do, but when push comes to shove its a thin sheen over tribalism ("My opponents are obviously not being held to account").
> Believe in something. Even if it means sacrificing everything. Especially investor's money, because that's what it's there for.
So long as your belief is justified (even if mistaken). Some people think that they can believe hard enough to make fiction a reality. It’s not always easy to tell when this is thinking outside the box vs self-delusion.
From what I have read, this is a third case. It seems to have crossed from belief, to delusion, to deliberate fraud.
> Believe in something. Even if it means sacrificing everything.
I can't believe no one has caught on to the fact you are apparently making some sort of joke based on the just-now-launched Nike ad campaign with the same exact text.
Don’t get into a relationship with someone twice your age just because he was successful at one point of time in his life. Especially if he’s not humble.
At Ramesh Balwani’s age, if he were really that experienced, a person learns to run a company without shouting madly at his employees.
Correct me if I'm wrong, but wasn't the thesis of Bad Blood just that Theranos simply had no groundbreaking new technology? (and of course that Holmes and Balwani lied and bullied their way into an insane valuation for blood-testing tech that didn't exist and was propped up by third-party commercial testing machines)
They couldn't even do the basic stuff they fell back on after their groundbreaking machine failed to materialize, but they lied about it anyways and hacked COTS blood testing machines to accept fingerstick samples instead of the veinous draws they were designed to test --- which didn't work, and generated false results. They spent as much effort trying to contain stories and intimidate whistleblowers as they did on test accuracy. That'd be how I'd sum the book up.
I'm not a doctor or psychiatrist, but a lot of what is written about Holmes in that book reminded me of what I have read elsewhere about narcissism. For me a lot of the takeaway from the book was that while these behaviors might pass for tolerable adaptions in the context of a taxi app or a social network, when you're doing medical devices the destruction becomes quite literal.
As a pathologist working on a diagnostics project, I feel the tiniest bit bad for the Theranos team, only because I've seen first hand how the system ignores anyone trying to start up in this space, and only really responds to money. The frustration of trying to work in this space could easily crank up the gain on a subset of any given person's tendencies in such a way as to create a fatal flaw. To some extent I'm grateful I got to watch them blow up. For shame, but there for the grace of God go I.
That frustration is understandable if you have a great product (or at least a truly realistic big idea) and struggle to get traction with clients and investors. But if John Carreyrou's account is accurate, Theranos was in the opposite situation. Their 'idea' was just an unrealistic goal, and their product barely existed, even at the time they were rolling it out for use on actual patients. The one thing they were good at was persuading investors and clients to give them money.
Despite published papers to the contrary, a lot of people think I only have an unrealistic goal. And I'm here to tell you the product barely exists as a single prototype. Four years ago, the idea existed only in my mind. I started the work 7 years ago.
I'm no Theranos apologist. Based on the conversation, I'm ordering the book to see if there's really any more detail. But keep an open mind. Assume people are no worse than you.
I don't think this is what you meant, but just in case: I certainly wasn't implying anything negative about you or your idea. If you think I'm being too harsh on Theranos, well, my mind was open too until I read the book. :)
I don't think Theranos was intended as a scam from the start, and even when it was well into fraudulent territory, Holmes seems to have had some kind of genuine belief. (If not, I think she could have got out earlier with lots of money and less legal/reputational exposure.) But unless Carreyrou got almost everything wrong, there's no reasonable way to see the Theranos story as a tale of more-or-less well-intentioned people responding in forgivable ways to the pressures and challenges of a difficult industry, as I think you're suggesting might be the case.
It was more like a death spiral of unrealistic promises bleeding into outright lies, a cult-like working environment, bullying and legal intimidation of critics, and eventually the deliberate (or, to be extremely charitable, wilfully ignorant) use of unreliable technology to conduct medical tests on, and give inaccurate results to, unsuspecting patients.
Don’t feel sorry for her. She basically made your job harder. Now everyone who invests in medical research will be less likely to believe in your prototype, regardless of its efficacy.
I'm mildly curious what your device does. Based on reading random past comments, it sounds like it might have something to do with cancer and embryology...?
I just make a serious effort every day to be less awful, and I've learned that when I try to trade my soul for huge success I get neither. But I know what it's like to go to the bad, and I know other people will do likewise.
To me, the Theranos story feels very natural and plausible. And I hope I will always be prepared to choose poverty and failure rather than try to elbow my way into a place I'm not supposed to be.
But there will always be someone who is prepared to lie, cheat or destroy just in order to beat me over here playing nice. Because they ARE no worse than me. But I don't have to give in to my worst nature…
I’m not medical but have a great team of medical and AI folks I work with. We are also in the hematological analysis space with a startup. We are using robotics and artificial intelligence for our product and are in the medical validation phase of our solution,
Folks we speak with have a lot of passion for this space. We believe the Theranos story actually highlighted the size of opportunity for improvements in this industry.
I recently read this book as well, and can highly recommend it. Bad Blood is investigative journalism at its finest.
(It wouldn't surprise me if we eventually get a film adaptation... but those are always worse if you read the book.)
The reporter, John Carreyrou, also caught backfire from Theranos. Especially his sources whom he did try to protect but were stalked by private investigators & lawyers.
Given that Theranos didn't have a product it is only good news that they're finally dissolving. Holmes and Balwani ruled with tyranny and compartmentalisation which created a toxic work environment, but that does not mean all the employees were ignorant or stupid or into the scam; many of the employees were highly skilled and intelligent. Those who did know they didn't have a product (or that it was some dirty hack based on a different product) were manipulated by Holmes and Balwani.
I saw someone mention psychopath. I'm unsure what exactly these two people are. Sociopath, psychopath, narcissist, whatever it is; it isn't pretty.
When I read the book I was regularly reminded by Brian Krebs' "Sources: Security Firm Norse Corp. Imploding" [1]. They also had no real product and used compartmentalisation. Also well written (though way briefer).
Very surprised she would take on such a reviled role, she hasn’t historically played villains has she? I think that movie was planned at a time that Holmes was still believed to be tragic and delusional rather than a cold-blooded conwoman with no redeeming features.
Its not about hero or villain, its that she has a repertoire of strong female (main) characters. Katniss Everdeen is a hero for District 13, but an enemy and villain for the rest due to the survival of the fittest nature of that world.
Katniss was a heroine to the viewers. Holmes is not a heroine to a anyone. And she exploited the “strong female” narrative all along the way, undermining other women.
True, however Holmes tried to be the heroine. Having to act as if you're the heroine until the last few scenes, with some twists in between, isn't a typical villain role.
For a movie that hews startlingly close to that narrative, check out "The Informant!" starring Matt Damon and directed by Steven Soderbergh. I'm also not surprised Lawrence would be drawn to the role, it seems in line with what she does well: strong female characters. They're not always likable characters (for example, in "American Hustle"), and it also shouldn't be a surprise when an actor expands into different kinds of roles.
First movie I ever saw Jennifer Lawrence in was Winter's Bone [1]. Goodness grace, she's such a heroine in that movie. No wonder she got typecast for the strong female roles.
Me as well, and I definitely noticed that her role in "Hunger Games" was basically a young-adult dystopian scifi version of her role in "Winter's Bone" - and I feel her performance in both made each movie.
> I think that movie was planned at a time that Holmes was still believed to be tragic and delusional rather than a cold-blooded conwoman with no redeeming features.
The "Bad Blood" movie is based on the "Bad Blood" book, which is the definitive source documenting Holmes' frauds.
Well, in fairness, the technology wasn't there or possible (given current understanding of microfluidics), so it couldn't have revolutionized testing even if it was run more honestly. It could have harmed fewer people though if it never existed.
This comment........Holmes is wasting her natural talent. Instead of running this fraudulent company, she ought to be voicing a young Darth Vader in the next two Star Wars movies.
> I think the most disappointing thing about this whole saga is that (in theory) the Theranos technology was supposed to be a major healthcare game changer. It could have revolutionized testing, and would surely have saved countless lives.
The one thing I am very surprised so few people bring up is that finger sticks hurt like heck compared to a venous puncture. I give blood all the time, so much that I have scars from giving blood (and donating plasma in my youth). The only thing about giving blood that hurts is that darn finger prick to check your hematocrit. Sometimes I can't type the whole rest of the day. I would never choose a finger prick over a regular sample.
In my experience, getting shots or blood draws does not hurt. A finger prick might or might not. But I'd prefer the finger prick anyway because it's much less creepy than having a long needle stuck into your vein.
Antivaccination movements historically pop up in all kinds of different places and contexts for different nominal reasons, and I'm pretty sure a big part of what gives them steam is that people just aren't comfortable with the physical logistics.
Interesting. I’d echo the original commenters sentiment. I have given blood a few times and was never really bothered about the long needle sticking in my arm, nor the process in which it got there, but the two times or so where I got the finger prick for a small amount of blood were a painful and inconvenient experience.
I don't donate blood nearly as much as you do but I never had the issues you've described. Maybe you're particularly sensitive to it for some reason? Or maybe you've done it so much that you've developed some form of intolerance, if that's even possible?
I have exactly the same thought, I remember then I was a kid blood was taken by fingerstick and it hurt so much, I have bad memories even now. It might look less scary for children, but it hurts much more.
It depends on who is doing it...how much pressure is applied and how deep the puncture tool goes. There are puncture tools for diabetics that are extremely precise in that they only puncture as little skin as possible. These don't hurt.
I had various nurses as a child and the pressure/closeness the puncture tool was applied with, matters more than anything. With any puncture tool, if its already being pushed into flesh, ie. skin is forming a valley, its more likely to cut through deeper layers due to the compression.
It makes sense, there are more nerve endings on the finger tip. Though, when I was a child I had a phobia of needles that i only escaped from in my 20s.. I would've preferred the prick and the pain that comes with it than the needle.
Not my experience. Further, while it doesn't happen routinely, it's definitely not uncommon for me to end up with a nice big bruise at the site of the blood draw. I know which one I'd pick given the choice.
just be the type of person whose veins are not easily detected. You want pain, just have them miss a few times trying to find a vein. I would say that the finger pricks can hurt more depending on which finger and the position of the hole made.
then again I am a big chicken when it comes to shots
/not relevant to the article, but sort of relevant to your comment.
When I was 11 I was in the hospital. A nurse was going to replace my IV. She spent 45 minutes trying to find a vein in either arm. She got another nurse and within 5 minutes, it was done.
The new nurse said that the previous one just got done trying to put an IV in an infant so she was "a little stressed" and "should have known better" about not stabbing a child for 45 minutes straight.
That experience was pure hell. It hurt so much. I was so sick that I could barely move or talk to ask for someone new. All I could do was lay there screaming in my mind and sort of move every once in a while.
It is hard to remember a time when Theranos wasn’t a byword for scamming, but if you have 15 minutes it’s worth searching HN for Theranos articles and look at comments from the very beginning.
It seems from those comments there that a lot of people on here were quite sceptical to their methods from the start.
There are a lump of people who appear excited in general, sure, but the people who appear to have know-how in the area are more subdued and questioning, even then. There are a fair few comments calling it garbage.
It's cynicism, but that's hard not to contract these days. If you've been around the Internet long enough and know something about anything even remotely scientific or technical, you quickly learn that:
- You can't trust scientific press releases at face value.
- You can't trust companies not to oversell themselves, in particular startups like this, you never take them at face value.
People are much less cynical when a company is open about what it's going to do and how, talking science and engineering instead of marketing & PR bullshit.
Isn't that the good thing though? I know some people dislike the negativity but as long as it's constructive criticism I think it's valuable. I'll take "I think this is a bad idea because of X" over "omg this is so cool!". Of course "I think this is great because of X" is also nice.
In this particular case I think the criticism was warranted, even if you try to only consider what was known at the time. "We are a new startup led by an inexperienced yougester and we have a product that does everything better and cheaper than the industry standard but we won't peer review" seems like a huge red flag. The Forbes fluff piece with strange and rather dubious claims regarding the level of skills of the founder adds a second layer of redflagging on top of that.
Where? The only thing even remotely negative I see in the top comments is questioning why they had so many big names on the board that had nothing to do with startups, biotechnology or medicine.
In hindsight it seems like a way to keep the government away by trying to bribe people in it.
Mattis in 2016: "Man, serving on this board reflects poorly on my ability to pick out people with integrity, it even makes me look complicit in deluding people. I better choose another job to clear my name."
Bad Blood is an awesome book. Really disturbing. There's a story about a naive stanford grad who joined Theranos and tried to blow a whistle internally when he realized that the "Edison" (a Theranos-based testing equipment) was BS. Holme's right-hand-man destroyed the kid, fired him, and even turned his grandfather against him (who was an investor - these Stanford fucktards and their legacies). Of course that stanford person is now pursuing his own startup...
Bad Blood has not had the impact in SV that it should have. The stock market needs to crash and the myth of steve jobs needs to die :-(
> The stock market needs to crash and the myth of steve jobs needs to die
It's not all about myths. The interest rates are still very low especially for the rate of growth. Decent returns are hard to find and people are willing to chase just about anything. Ofc, her decision to copy alot of Jobs' style made for some easy pickings.
In seriousness, internet business culture makes everything look easy. Internet things have outsized impact due to the global reach of a revolution in communications technology. Smartphone things have outsized impact due to good UX finally reaching the masses when they were ready for it.
I think the lesson here is that doing anything that interfaces directly with the physical and natural world is much harder, and those problems that have high impact have had a lot of very smart people working on them for a very long time.
It's easy to think that the formula for internet media or smartphone IT success can easily translate to these domains, and it seems that the reality is "no, it doesn't.". There is no low hanging fruit on the hard problems, as there was with the internet and smartphone revolutions.
I like your approach but I disagree with your conclusion. Just recently Pepsi Co bought SodaStream for $3.2B. AFAIK, SodaStream is essentially a company that innovated with the UX outside the Internet-based technologies, not solving some hard problems.
Theranos claimed to have been doing something similar but failed due to their choice of UX improvement approach being based on technology that does not work.
An analogy in the internet-based business would be promising to improve the UX of customer support using AI and then not delivering on the AI part.
I think that your "Outsized impact" concept is interesting but I think that there is no such thing, it's just an illusion due to the speed differences of the delivery of the impact. Should Theranos was not based on pseudo-science, the eventual impact could have been no smaller than your average internet unicorn.
internet/smartphone success comes from low hanging fruit made possible by revolutions in communication technology. it does not translate to hard domains like biomedical science. these problems are legitimately hard. and quite orthogonal to soda and chatbots.
That may be true in a literal sense but misses the far more important corollary: low hanging fruit in consumer technology often drives progress in harder domains. Military and academic investment in telecommunications and transistors may have given birth to Silicon Valley and IT as we know it today, but it was massive investment to feed consumer demand that really made harder scientific and engineering problems tractable.
The drive for better graphics in gaming fundamentally changed the face of bioinformatics and genetics, finite element analysis and by extension, almost every subfield of mechanical and civil engineering, and many others. The logistics and transportation industries have gone through a quiet technological revolution every decade as economies of scale drove the cost of computers, GPS, and other embedded electronics to the floor. The demand for laptops, mobile phones, and tablets with ever more complex apps and games is responsible for at least a 5-10x change in productivity for my EE and firmware work over the last decade as the sheer scale of work on consumer electronics around the globe drives down the cost of parts and services right as the hardware world is beginning to learn about the benefits of open source.
Theranos' was not about making something previously impossible, possible.
Theranos doesn't have anything to do with biomedical science, they were supposed to improve the experience of blood testing both for the patient and for the medical professionals. Their problem was that they choose to try to do it by a method that was not technically possible at this time.
Another company might try to improve the experience by improving the needles and redesign the machine to look like less offensive and scary and they might succeed in it.
It's exactly like the difference between SodaStream's success and chatbots failure, that is, betting on UX improvement using a tech that's not there.
Chatbots, SodaStream. Theranos - they don't do anything new that wasn't done before. Chatting with customer support was around since a while, Carbonating water to make soda was around since probably the industrial revolution and testing blood samples were around since modern medicine.
All these companies tried to improve the experience and reduce costs, regardless of the nature of the business being internet or manufacturing based. It's not about the domain.
EDIT: I'm not defending Theanos and I'm not going to comment about the motive of the people involved as I don't know them and I was not involved with Theanos at any time.
> Theranos' was not about making something previously impossible, possible.
Yes, it was. They were trying to do more tests with less blood. That's like, you know, new advances in biomedical science.
> Theranos doesn't have anything to do with biomedical science,
They claimed to create a new method for blood testing that required a fraction of the sample size previously required. That is, by definition, biomedical science.
> they were supposed to improve the experience of blood testing both for the patient and for the medical professionals.
Yes, but that pesky biomedical science got in the way.
> Their problem was that they choose to try to do it by a method that was not technically possible at this time.
The limits of biomedical science can be a real buzzkill. But hey, the UX was great!
> Another company might try to improve the experience by improving the needles and redesign the machine to look like less offensive and scary and they might succeed in it.
It failed because it didn't work. Because biomedical science.
> It's exactly like the difference between SodaStream's success and chatbots failure, that is, betting on UX improvement using a tech that's not there.
We should all tell Merck and Pfizer to be more like SodaStream. Cancer would be a thing of a past. It's merely a UX problem.
> Chatbots, SodaStream. Theranos - they don't do anything new that wasn't done before. Chatting with customer support was around since a while, Carbonating water to make soda was around since probably the industrial revolution and testing blood samples were around since modern medicine.
I went into the forest once for a hike, it was very nice. I liked the trees. Do you like to hike? It's good for you. Modern medicine.
> All these companies tried to improve the experience and reduce costs, regardless of the nature of the business being internet or manufacturing based. It's not about the domain.
What you're trying to do never matters! Cancer can be cured. We just need to improve the experience and reduce costs!
> All these companies tried to improve the experience and reduce costs, regardless of the nature of the business being internet or manufacturing based.
No, Theranos did not do that. They claimed that's what they were trying to do, but they were, in reality, marketing a fraudulent product that did not work.
This is very simple. It is also a very important distinction, and it's worrying that many people here seem not to get it. This is not a "they tried and failed with the best of intentions" situation. This is not a typical failed-startup situation. This is not a product-market-fit issue.
This is a company that claimed to be improving the state of the art but was actually engaging in a deliberate deception.
You don't have to know the "motive of the people involved" to understand that Theranos' situation is fundamentally ethically different from that of a well-intentioned company that was unable to deliver on its promises. This isn't a difference in degree (of money involved or people defrauded or whatever), it is a qualitative difference. It's deeply disturbing to me that yourself and many others seem unable to see that.
I don't know about the details of the case so I'm trying not to claim that somebody did something in bad faith. I find internet lynches distasteful.
Did an actual investigation found out that these people scammed the investors?
What was their end game? Live a life of fame for a few years until people start asking questions and end up broke and labelled as frauds for the rest of their lives?
> Theranos doesn't have anything to do with biomedical science
Doesn't it? Wasn't that the main claim of the company? To have the technology that allows to do a lot of tests with very small amounts of blood? In your description it sounds like "Theranos had a great idea, unfortunately the technology was not read", like some kind of mild inconvenience that stopped something brilliant. Like "My company wants to build flying cars based on anti-matter reactors. The technology doesn't exist but, apart from that, isn't my idea brilliant?"
I think their main claim was to improve the experience and reduce the costs for the users and the medical professionals.
The rest of your comment is a straw-man argument as it misrepresents my words as I never even implied that they had a great idea or tech or anything like that. Sorry I cannot defend words that are not my own.
That's like saying that a scam company that claims to sell a widget that makes your car go at 500 mph, with a mileage of 1000 mpg is not 'claiming something previously thought impossible to be possible.'
Cars exist, and fast cars exist, and people mod cars, so obviously, it should be possible to soup up my Honda Civic with their amazing invention.
Theranos claimed that they had technology that could perform accurate blood tests on tiny samples of blood, drawn from a finger. For many tests, this is currently believed to be impossible (with sufficient accuracy.)
More like aiming to improve the safety of the cars.
One company can try to do it by putting sensors to improve the driver's situation awareness and another company can try to make the cars driverless.
Driverless cars also don't exist but apparently, enough people believe that it could be done and the research is going on.
Maybe at Theanos they never intended to make the promised machine but I don't want to join the lynch as I don't know the people involved and I can't read peoples minds.
I just finished Bad Blood and one thing I have noticed is that how much you can get away with if you have mastered the art of talking to powerful people. It seems they could have figured out much earlier that Theranos was a fraud if anybody had ever bothered to take a closer look. Even when some people started having doubts Holmes always was able to take herself out of it. Instead the whistleblowers got treated badly. The Shultz situation was especially frustrating to read.
This reminds me a little of a situation at work. We have a director who everybody outside management knows he is full of sh.t. He never delivers anything and when you get the chance to talk to VP or CEO they agree that he needs to go. But then they talk to him and he always gets a second chance. This guy gets much more face time with our CEO then anybody else I know.
I really, really wanted their tech to be real. It could have been transformative. I've seen a lot of glee over their (well deserved) failure, but I'd much rather be celebrating their success.
Did anyone ever follow that $100 million a hedge fund dumped into the company like a year ago, well into the crap htting the fan? What was that about? Why would you do that?
It was for their patents - as one of the other commenters mentioned, in the event that they fold, i.e. now, the hedge fund gains ownership of all their patents.
Did they hold any valuable patents? As I understand the FDA came out and said the device didn't work and beyond that any evidence suggesting it did was not just misguided but fraudulent.
While GP's comment is somewhat tongue-in-cheek, the Manafort conviction is so newsworthy because it is such a rarity that white-collar criminals get prosecuted to this extent. It's the exception that proves the rule. Keep in mind, after the 2008 global financial crisis, in which several prominent financial institutions failed and millions of people lost their homes to foreclosure, only one banker was sentenced to jail time, and only for 30 months.
> after the 2008 global financial crisis, in which several prominent financial institutions failed and millions of people lost their homes to foreclosure, only one banker was sentenced to jail time, and only for 30 months.
Just because something bad happened doesn't necessarily mean there was a crime for which an individual can be sentenced to jail time (regardless of public outcry after the fact). Here's a list of SEC enforcement actions arising from the crisis https://www.sec.gov/spotlight/enf-actions-fc.shtml
One of the most common crimes (and the most direct cause of the crises) during that saga was actually bank fraud from overstated incomes. Nobody really went to jail for that either.
Sorry to be a devils advocate but past administration loosened up rules based on which you were or were not supposed to be eligible for a loan to an extent which it should never be.
Unless you want to jail George Bush or some of his staff members, there is not so much fault around to put on people working in financial sector.
> you have just implied that ultimately no one can be held accountable for these failures. Isn't that a bit of a problem?
Yes, but not one to be solved by retroactively classing behaviour that wasn't a crime then as a crime now. The right solution is to criminalize the behaviour moving forward.
Part of me is disappointed that the tech Theranos had promised never amounted to anything game-changing; but the other especially enjoys Carreyrou's in-depth investigative reporting of the subject.
Serious question, even if the answer is fairly obvious; What does the future hold for Elizabeth?
I mean, how will a person who has done that and basically become a digital leper, recover or work again in any meaningful way? Change her name, learn a new language and move to another country?
With her connections, it's hard to imagine she wont be able to find a way to keep venturing into new businesses. It's not like everyone who commits fraud ends up behind bars or something either.
Maybe the investors deceived themselves. If I was investing millions of bucks in a startup run by a 19 year old I'd be doing a large amount of investigation. Doesn't seem like anyone did
How many investors did not invest after they investigated? We'll never know. Theranos HR and legal dept. were fierce against any whistleblowers. One person even committed suicide because of the involved stress.
I read about it in Bad Blood, it was perhaps the most disturbing fact from the book. Especially given the suicide was in direct consequence of Theranos' scam, and also because I lost my uncle to suicide related to his work (which I suspect was related to ethics). There is a Wikipedia page devoted to the late Ian Gibbons [1] (I didn't verify the content of the entry though). I can highly recommend the book Bad Blood.
Jail, I'd assume. Holmes (and Balwani) have been indicted on nine counts of wire fraud and two counts of conspiracy to commit wire fraud by a federal grand jury (they've pleaded not guilty).
Wire fraud apparently carries a maximum penalty of 20 years, so they could be going away for a while. Holmes is also barred from serving as a director or officer of a public company for 10 years, due to a previous SEC settlement.
She's very ambitious but now most people have lost confidence in her, so she will be able to pursue meaningful goals but not with the help of many other people as before. Quite a pity, imagine charismatic people using their cunning to benefit the world instead.... what a place it would be.
That kind of charisma is toxic pretty much by definition.
Also, when was the last time someone running an ethically clean and successful charity or social enterprise got the kind of press people like Holmes do?
Holmes is a rich narcissistic kook, but Theranos was the product of a business culture which values hyper-driven narcissistic kooks who surround themselves with exploitation and drama over steady mature professionalism.
If you read the book, you'll find that her parents were never especially wealthy. Her extended family was wealthy at one point, but she grew up in a solidly middle-class lifestyle. Her father worked for NGOs and non-profits. They had good connections, but didn't seem to have a lot of money. One of the conflicts that Holmes had to deal with came from her father's envy of a neighbor and friend who truly was wealthy.
I hope I'm not becoming "that guy," but I feel like everyone is still missing the point on Theranos. Even if they hadn't defrauded investors, the company would never have had the impact they claim, because Theranos' entire finger-stick idea just doesn't fit into the lab industry.
I spent a bunch of years in labs, working for the tech companies that made the "state of the art machines" that did the actual testing. Theranos wasn't only competing with LabCorp and Quest, they were also competing with the testing machine companies like Beckman-Coulter, Roche, Siemens, Bio-Rad, and many others.
So many tests get ordered for a CMP (comprehensive metabolic panel, the most common battery of tests), that you would need like 30 finger sticks to get enough blood. Theranos never clarified if they could do 30 tests on 1 drop, or 1 test per drop. That little misdirect actually matters a lot to the patient who might have to get stuck 20+ times for all the things the doctor needs.
I'm quite familiar with the way the state of the art systems work. A modern system is already testing microliters of plasma (your blood goes through a centrifuge) per test. Comparing size of blood draws is misleading. The several tubes that get drawn are for logistical reasons that don't go away if you switch to finger-sticks. For example, the law requires that a lab keep some blood on hand for emergency re-testing if it turns out you have a critical level. Maybe a tech drops your sample. Maybe the machine has a problem right when it's doing your test (happens all the time, no reason it wouldn't happen with the Theranos instrument, had it existed). How many finger sticks are required to keep some extra on hand?
Theranos was also misleading about the test time, but that doesn't get mentioned either. They claimed 4-hour test time, but compared it to the 24-hour turn around time of a major lab like LabCorp. In reality, modern systems take 8-15 minutes for most tests, depending on what it is. Large molecules (hormones, etc) and whole-blood tests can take longer, sometimes up to 1.5 hours on older machines. Nothing approaching 4 hours, though. A 4 hours test time is atrociously long.
And after all that, you still need a doctor to look at the results. Let's say the dream happened, and we all started going to Walgreens to get Theranos tested. Even if we got 30+ tests on a single finger-stick drop, we'd still need to wait 24-72 hours for the doctor to look at the results and call us.
Maybe I'm beating a dead horse at this point, but I think from the very beginning, Theranos didn't have a serious business model. I also would like anyone on HN reading this, who's interested in the medlab space, to understand that there's a lot more going on than just testing on fingerpricks and fraud here.
If any of you out there actually do have a revolutionary one-drop testing device, don't try to partner with Walgreens and open your own labs. Just sell/lease it directly to doctors and hospitals.
To clarify, they were proposing much more than 30 tests from one drop. They were marketing (to investors, not me but close friends in the industry) the ability to do 100 tests on a drop and then auto-retest from what was left of the same drop for anything that didn't meet some threshold or auto-perform some other indicated test on the basis of a first test result from the original 100-test panel. These numbers are maybe not entirely accurate, but within the ballpark of what was at least implied. All lies/marketing of course, but the dream was real.
Yeah exactly - everything they were proposing (either directly or indirectly) through marketing suggested they were making a device that could take a drop of blood, analyze all results, and give results almost immediately. If it didn't fit in the "existing lab model" it is because it was supposed to replace it. Of course, if it was real, it would have had no problem printing money as the value would be enourmous.
Could it have worked with standalone systems, running in hospitals, doctors' offices, etc? That would be impossible with current (or vaguely conceivable) technology, of course. Some years ago, I was seeing a doctor who did urinalysis in house. I figured that he was money grubbing, and maybe insurance companies eventually decided the same.
It depends. There are Point-Of-Care systems already, usually for things like urinalysis as you mentioned. If they did have a small, accurate, fast (~10 minutes or less per test, definitely not 4 hours) new system that could do multiple tests on a single drop, then yes, putting those directly in doctor's offices and hospitals would be the right idea, as long as you can make the financials make sense for the doctors.
Really, there are already small systems for just about any test you might want to do, it's just that economies of scale for a big lab like LabCorp usually make it too comparatively expensive to run your own system, because you need to pay for the system and hire a licensed technologist to operate it. That's not just bureaucracy, either. Most current systems can have lots of weird problems that affect the results, and you need someone who understands both the medical relevance of the test (and normal/abnormal results), as well as some statistics, in order to know when the machine is operating correctly and when it's giving you subtly biased results and might need re-calibration or something.
In big cities like NYC, it's more expensive to ship the blood out of the city to LabCorp/Quest's big regional facilities, and the "big" labs inside the city are way smaller (so they cost more). So doctors are more likely to be able to swing operating their own system.
Also, some doctors charge way more than normal for their services, particularly IVF/fertility clinics. Those places always have their own machines (their clientele are also more demanding, and would expect results faster than you can get by sending out to LC/Quest).
No, it could not have worked as desired with any system, because it is fundamentally impossible to use a drop of blood to detect chemicals which are present in the circulatory system from which it was drawn, but are not present in the specific drop being tested.
Blood is not a homogeneous substance. In order to be satisfied that you can detect substances that are present in the person, you need to extract more than a drop of blood.
To be more specific, most tests are designed around venous blood samples. Theranos' finger-prick would gather blood from capillaries in the finger, where the vessels are very narrow (changing the balance between blood cells and plasma) and also where diffusive processes into and out of cells are extremely active - and so assays like blood glucose level may be significantly off from what you would see in a venous draw, if for example your finger is curently burning a lot of energy ...
BINGO. That really is the elephant in the room. Everyone skilled in the field knew it shouldn't work. Not because of limits of detection or micro-fluidics (engineering problems that could be improved/mitigated/worked-around, eliminated), but because of fundamental biological principles that cannot be changed.
I can’t help but wonder if Theranos’ tech really was that good and they got crushed by big medicine? It really doesn’t seem all that far fetched to me.
The Outline is missing some of the text it looks like? The text "according to a shareholder email. Theranos" is nowhere to be seen in the outline link.
I’m not a medical person so I’m not sure about the statistical sample volume required for typical tests. I do know that I’ve had comprehensive testing done and they took 5 tubes the length of my finger. That’s pretty far from the drop of blood that Theranos were after.
The future has a way of returning to these things. We’ll see if there’s even a partial approach that could work soon enough. Or not.
When you give blood they usually hide the bag, I suppose for the squeamish. But that drives me mad, just waiting there not knowing how much more to go - It's a natural progress bar!
I'm sort of sad about this. I liked having a well known company headed by (and founded by) a woman to hold up as an example for my daughter. There are other billion dollar companies headed by women, but I think this was the only "science" one other than 23andme?
Theranos was a running scandal for the past year of two, it's the last kind of company, and last kind of woman you'd want to use as example for your daugther.
Show her Jennifer Doudna instead, a woman who apparently gave us CRISPR/Cas9 - one of the biggest breakthroughs of recent years, if not decades.
Jennifer is an amazingly successful and brilliant person. But, let's not forget Emmanuelle Charpentier. She is the one who spent over a decade peering at the amazingly strange and esoteric pieces of the puzzle that when eventually pieced together became the story that we all now know as CRISPR. She persevered when the world scientific community yawned at her bizarrely focused "sequence gazing". Many thought she was just finding patterns where randomness/happenstance would guarantee such fake patterns would naturally occur if you looked hard enough. Jennifer and her group, to be sure, contributed a lot to realize the end result, but Dr. Charpentier's contributions were the necessary foundation.
And let's not forget Virginijus Šikšnys either, who discovered CRISPR-Cas9 independently at the exact same time but whose paper got rejected repeatedly until it was finally published three months later than Doudna et al.
Silly question: How sciency was Holmes? Did she personally help develop her (completely fraudulent) blood tests? Or was she merely a business woman in charge of bringing this bag of hot air to market?
(Hint: I don't really care if she supposedly helped develop it. It didn't actually work. She's not some kind of genuine scientist.)
I'm just gonna leave this here and suggest that most of whatever tech was developed by these 1000+ still active companies likely wouldn't have made it to market without YC:
(Also, this isn't intended as snark. I'm just cranky at the moment and seriously cannot see why it matters that Jessica "isn't sciency." My crankiness is for wholly unrelated reasons and has nothing to do with this discussion.)
How sciency was Holmes? Not very. She dropped out of college after one year. Although many people have had great success in software with this level of education, it's kinda hard to imagine somebody making major contributions to the life sciences without even a bachelor's degree.
I don't think an investment company counts as finance, though I agree the line is a bit blurred when it comes to private equity. Otherwise, you might need to throw in Abby Johnson, since she owns Fidelity and Fidelity is a major investor in Uber and many other pre-IPO (and post-IPO for that matter) companies.
Well, I think we can generalize that to many Tech Companies in general, if you examine their "value add" Google, FB, Linked-In, etc. There is something unappealing in quite a few. Not that each one is _all_ bad, but many have at least _some_ bad. in them. G and FB obviously trade in user data. On the other hand AMZ leverages many lowly-paid warehouse workers. Netflix is unapologetic about getting people to "binge", they don't even apologize for the word binge (which is typically associated with unhealthy alcoholic intake).
Yet, they all add some good value to many people as well, despite those flaws.
I mean 23andme seems (to some) to originally have been a vanity project funded by Google founder's massive money to give wife something to do (super over the top uncharitable, misogynistic, chauvinistic characterization to answer the "why is that? question). However they have pivoted to something very interesting lately. They are now a drug development company and have hired some of the best in the business to mine their data and develop novel therapeutics. They have Germaine Fuh! 23andme is now a cool company!
The "health" tests were of dubious accuracy, but as a long-time customer I always thought their warnings and caveats about those tests were enough. I was sad when the FDA made them stop. However, since the FDA action and the recent restoration of the health tests the product has improved, so I guess the FDA's move was was for the best.
The genetics component has always been terrific. I've had friends uncover surprises, like one who unraveled a mystery about an undocumented and unmentioned great-grandfather, who they found out was from a different continent and shunned by the family.
Even though I work in the 'omics field, I'm still amazed every time I get an email from 23andme that a sibling or cousin has joined, with them determining that based on nothing but some spit.
I think it's a very exciting company to watch and it's just getting started.
At some point, engineering becomes science. I am not qualified to really opine on this particular aspect of engineering v. science, but if she is developing new methodologies that are really on the cutting edge, then it's science, even if it's engineering science.
How many startup founders are scientists? Not including engineers and computer scientists, I mean. And how many startup founders are female? So it's not surprising that there aren't many.
Tho its predominantly males there are many women who are leading or lead large businesses. Meg Whitman for example, lead eBay from 30 employees to 15000.
The unique feature of Holmes was that she was the first woman starting and leading a (supposedly successful) start-up. Needless to say though, it was a facade. That's saddening, but having read Bad Blood I expected nothing less but the company Theranos to dissolve.
It's really worth reading through historical HN threads on Theranos to get a feel for how the media was content to serve as a PR outlet for such a long time, and how people were so taken with the narrative Holmes and her allies pitched..
I think the most disappointing thing about this whole saga is that (in theory) the Theranos technology was supposed to be a major healthcare game changer. It could have revolutionized testing, and would surely have saved countless lives.
But instead... here we are.