By April 2016, Theranos and Holmes were under criminal investigation by the Securities and Exchange Commission (SEC) and prosecutors in the United States for misleading investors and government officials about what was supposed to be this revolutionary device.
- Born on February 3, 1984, Elizabeth Anne Holmes is a former American businesswoman who was the founder of a health technology company called Theranos.
- In 2002, she studied chemical engineering at Stanford University, but dropped out before completing her studies.
- Holmes had a big idea, one that would change blood testing forever if it worked.
- The idea was simple: a device that could run a bunch of medical tests off of a single drop of blood.
- Medical professionals first thought that such an idea was impossible, but the device, called the Edison, was announced.
- Thanks to this device, Holmes’ company received a huge number of big, high-profile investors and plenty of funding.
- By 2015, Theranos had been valued at US$9 billion and Elizabeth Anne Holmes had become the youngest and richest businesswoman in America.
- Then the company shut down for good.
What happened to Theranos?
- Before Theranos went bankrupt, Holmes claimed that her device would be able to save millions and “change the world.”
- Holmes’ was on the cover of several magazines, including Fortune, Forbes and Inc. She was also profiled in The New Yorker.
- Investments came pouring in and magazines were falling over themselves to feature her on their covers. But a reporter for The Wall Street Journal thought there was something strange about Holmes and her company.
- John Carreyrou, a health care reporter for the paper, read her piece in The New Yorker and was left with some questions.
- Carreyrou noticed that Holmes wasn’t able to fully explain how her technology worked and he was struck by how secretive she was about her company.
- In October 2015, he broke a huge story all about the shocking truth behind Theranos: the Edison device didn’t give accurate results.
- Not only that, but Theranos wasn’t even using their own machines for blood testing. As it turns out, they were just using commercially available machines.
- By April 2016, Theranos and Holmes were under criminal investigation by the Securities and Exchange Commission (SEC) and prosecutors in the United States for misleading investors and government officials about what was supposed to be this revolutionary device.
- By July of that year, Holmes was banned from owning, operating, or directing any blood-testing services for at least two years.
- In September 2018, Theranos closed its doors for good. Investors such as the Walton family, Rupert Murdoch and Betsy DeVos lost hundreds of millions of dollars in the process.
The trial of Elizabeth Holmes
- After an investigation that lasted for two years, Holmes was charged on June 15, 2018 on nine counts of wire fraud (defrauding someone using some form of electronic communication either within the country or overseas) and two counts of conspiracy to commit wire fraud.
- Holmes was supposed to go to court earlier last year, but her court date was delayed to August 31, 2021 due to the COVID-19 pandemic and her surprise announcement that she was pregnant.
- Hearings are currently taking place to determine if there’s enough evidence to go to trial. In these hearings, things like Holmes’ personal wealth are being scrutinized.
- Holmes’ attorneys said on Tuesday that prosecutors have no evidence that the blood tests didn’t work.
- Amy Saharia, a Williams & Connolly LLP partner representing Holmes, said the prosecution doesn’t have enough scientific evidence which “led to a gigantic hole in its case.”
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