Bad Blood

Jon Carreyrou

MacMillan

Otago Daily Times, August 4th 2018, republished in Corpus August 6th 2018

One of the most highly fêted names in biomedical circles in 2014-15 was that of Elizabeth Holmes, a 31 year-old woman whose company, Theranos, manufactured a small, easy-to-use device – the Edison– that was capable of running multiple analyses on a single drop of blood. Her subsequent fall from grace has been just as spectacular. In Bad Blood, John Carreyrou provides a comprehensive description of the company’s troubled inner workings and analysis of the cultural and legislative environment that enabled Holmes’ fraud to succeed for so long.

Although not yet commercially available, the company was running samples from Palo Alto patients on their in-house machines and had agreements with the Cleveland Clinic, Capital BlueCross and AmeriHealth Caritas. When the roll out was complete Elizabeth predicted that Thaneros technology would slash testing costs, spare patients the stress and pain of repeated blood draws and allow everyday people to monitor their own health on a daily basis the same way that a diabetic would check their blood sugar levels.

What investors and consumers did not know, however, was that beneath its elegant housing the Edison consisted of little more than a pipette robotic arm, only able to carry out one of the three types of tests Theranos offered and these with very poor reproducibility. Other tests were carried out on standard, equipment, but on such dilute samples that their results were also unreliable, and doctors using the company’s services were frequently having to reorder tests from other providers.

Although questions about Theranos had been circulating for some time, Holmes was a superlative salesperson and augmented her vision of patient empowerment with personal anecdotes about her own pathological fear of needles, and an uncle whose death from cancer could have been avoided had he had access to early diagnosis. These were stories that people wanted to believe and inspired shareholders and mentors alike with its altruistic focus and money-making potential. Furthermore she was a rare example of a woman making a mark in the male-dominated biotech industry at a time people were searching for ways to promote STEAM subjects to young girls.

Additional credibility was added by the presence on Theranos’s board of such such financial and political heavyweights as Rupert Murdock, General Mattis, Henry Kissenger, and Charles Schultz. All present and former employees were bound by rigorously enforced non-disclosure agreements that dissuaded whistleblowing and it was not until the Wall Street Journal published an article in October 2015 alleging serious problems with the company’s tests that regulators took notice.

The response, when it came, was swift and severe. Within a year Holmes had been banned from any involvement in blood testing services and now faces both civil and criminal charges for “[using] advertisements and solicitations to encourage and induce doctors and patients to use Theranos’s blood testing laboratory services, even though [she] knew Theranos was not capable of consistently producing accurate and reliable results” – a descent of Icarian proportions for the woman once named by Forbes as the world’s youngest self-made female billionaire.

Many of the company’s problems were certainly a result of Holmes (mis)management. Intensely protective of her intellectual property, she kept an extraordinarily tight reign on all aspects of the company. All internal communications were monitored and any interaction between the engineering and biochemistry teams was forbidden, which severely hampered their ability to identify and deal with the technological challenges of scaling down standard technology to work on the microfluidic scales. This was further complicated by the fact that she refused to consider using larger blood volumes under any circumstances, and immediately fired anybody who questioned her vision or approach.

Not all the blame for Theranos’ failure can be laid at Holmes feet, however, and the methods she used to sell her company were not unusual in their means, albeit extreme in their extent. When Theranos burned through the first tranches of funding without a working prototype, Holmes started offering a broader range of tests, presenting deals under negotiation as confirmed and promising increasingly optimistic future profits in an attempt to recapitalise. Her decision to offer her company’s services to the public despite their unreliability came after arrangements with a major health provider was then cancelled due to ongoing delays.

Such problems are not unusual in the biotech industry, however, as the recent news of developmental and regulatory problems with Ray Avery’s LifePod incubators exemplifies. In such cases people could easily find themselves in too deep to find a way out, or tempted to spin the truth in order to buy time to make things work. This is not to excuse Holmes actions, but the problems with Theranos are symptomatic of much more widespread problems in a biotechnology market, where the ability to capture the imagination of investors and consumers is as, if not more, important than a product’s feasibility.

John Carreyrou’s Wall Street Journal article first alerted the world to the problems at Theranos, and I thoroughly recommend Bad Blood to anybody interested in understanding more about them. But there is one other issue that I have yet to see fully addressed, and that is the role of Holmes gender. While Carreyrou discusses the way in which her status as a female role model in the boys-own tech club was a major selling point, he has little to say about the extent to which the pressure of expectation might have contributed to her desire to succeed at any cost. When he describes Holmes as a sociopath who knowingly put consumers at risk of real, physical harm, I can’t help looking at somebody like Elon Musk (who remains an acceptably bad boy despite his company’s product actually killing people) and wonder whether she would have been so vilified if she were a man.

https://www.odt.co.nz/entertainment/books/bloodhound-tracks-tale-technology-and-hubris