Theranos founder announces company pivot
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SAN FRANCISCO — Embattled Theranos founder Elizabeth Holmes announced Wednesday that the once high-flying biotech start-up would close its Wellness Centers and lay off 340 employees.
Holmes wrote in a company blog post that Theranos would instead focus on a proprietary blood testing machine that would, in theory, requires mere drops of blood to perform tests that traditionally require vials of blood.
The Silicon Valley company, which once was worth upwards of $9 billion, has over the past year been met with a variety of federal sanctions after investigators found deficiencies in Theranos labs. In most instances, the company was testing blood using traditional machines instead of its own device.
Most recently, Holmes was barred from operating a lab for two years by the Centers for Medicare & Medicaid Services.
“We will return our undivided attention to our miniLab platform,” Holmes wrote. “Our ultimate goal is to commercialize miniaturized, automated laboratories capable of small-volume sample testing, with an emphasis on vulnerable patient populations, including oncology, pediatrics, and intensive care.”
The layoffs affect Theranos personnel at its centers in Arizona, Pennsylvania and California.
Holmes’ open letter also notes that Theranos has a “new executive team leading our work toward obtaining FDA clearances, building commercial partnerships, and pursuing publications in scientific journals.”
Holmes and her company have been criticized for extreme secrecy. The company has come to represent how some Silicon Valley investors placed in an ordinate amount of faith in a charismatic leader who promised to revolutionize an industry but was unwilling to offer a transparent view into how that would be achieved.