The Downfall of Theranos and Elizabeth Holmes
What have we learned about the young women’s ability to defraud high profile investors?
Photo Source https://www.aljazeera.com/economy/2022/1/4/theranos-holmes-found-guilty-on-four-counts-in-fraud-trial
Firstly, in order to understand how Elizabeth Holmes sold the dream of her company Theranos to large pharmacies and procured millions in investing from firms (once valuing the company at “$9 billion” according to Investopedia) we must understand the technological advancement that she was promising.
Elizabeth Holmes, the CEO and founder of Theranos promised “insight on the onsite of disease” with her blood testing technology. She catered to the scared and rich populations, tricking investors with her ominous charisma. Her dream… to be the “Steve Jobs” of blood testing technologies a market that was seen to be monopolized at one time considering the need for certain procedures to create accurate testing. Elizabeth Holmes promised all the needed information for over 200 blood tests could be found in one prick of the finger, an idea that was easily welcomed into the healthcare community due to backing by well known investors and Holmes’ charisma alone.
The truth is, beyond Elizabeth Holmes’ showmanship no one knew the truth behind her technology. Why? Because the “billion dollar Silicon Valley golden girl” as people were calling her, was grossly embellishing the accuracy of her technology resulting in many false test results and wasted dollars. With a mixture of quality control issues and faulty technology, Elizabeth Holmes manipulated the world into believing in her project whilst her main priority was greed. According to Time, Elizabeth Holmes “amassed a $4.5 billion fortune” before the downfall of Theranos when claims of fraud shut her down. John Carryrou had said in an ABC News special that after integrating her product into 8,000 stores she was able to make a deal with the “the second-largest pharmacy store chain in the United States” Walgreens, which was a “140 million dollar deal” for Holmes. This became Elizabeth Holmes’ way into the American household as she graced magazine covers, did interviews, and many other media channels. She was quickly becoming a household name due to her young age and supposed scientific and entrepreneurial skills, and there would have been no limitations to her success if the product was not slowly being uncovered as faulty. Some families were getting test results that led them to believe they had cancer, while others were getting test results that lead them away from accurate diagnostics.
Elizabeth Holmes’ story began to crumble as the truth was uncovered. The FCC and Department of Justice filed claims against Elizabeth Holmes accusing her of fraud and in September 2018, Theranos reluctantly closed its doors. So, how did investors, the media, pharmaceutical companies, and patients get fooled? With a combination of toxic charisma, manipulation, and lack of due diligence on the part of investors, pharmaceutical companies, and doctors offices, Elizabeth Holmes’ faulty Theranos technology rose to popularity.
While Elizabeth Holmes has recently been found guilty of four counts of conspiracy and fraud due to her activities as CEO and founder of Theranos, the story of her company can teach us a very valuable lesson. It is always important that technologies, whether new or old, are tested for effectiveness often. It is important that product and procedural testing is done with an outside perspective in order to keep healthcare companies honest, and their products safe for the public.
Secondly, It is always important to advocate for yourself as a patient. Requesting a second opinion is often times imperative to reaching a proper diagnosis. Countless people were affected by the false test results they received by Theranos technology, it is important that we have peace of mind when seeking answers in healthcare. A person like Elizabeth Holmes should have never been allowed a rise to fame with the technology she was boasting as the message she was sending to the public was very dangerous. A large amount of blame also falls on those investors that did not do their research into a product they were pouring millions of dollars into, this is an example of why for profit healthcare can at times be abused. The notoriety of those investors put a bad amount of trust into the minds of the public concerning Elizabeth Holmes’ technology.
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Sources
Allyn, B. (2022, January 4). Elizabeth Holmes verdict: Former Theranos CEO is found guilty on 4 counts. NPR. Retrieved January 4, 2022, from https://www.npr.org/2022/01/03/1063973490/elizabeth-holmes-trial-verdict-guilty-theranos
ABCNews. (2019, January 24). How Elizabeth Holmes sold the idea of Theranos to employees, investors: Nightline part 1/2 and 2/2. YouTube. Retrieved January 4, 2022, from https://www.youtube.com/watch?v=87SWZ0Pna8k
Al Jazeera. (2022, January 4). Theranos’s Holmes found guilty on four counts in fraud trial. Corruption | Al Jazeera. Retrieved January 4, 2022, from https://www.aljazeera.com/economy/2022/1/4/theranos-holmes-found-guilty-on-four-counts-in-fraud-trial
Tun, Z. T. (2022, January 4). A timeline of Theranos’s troubles. Investopedia. Retrieved January 4, 2022, from https://www.investopedia.com/articles/investing/020116/theranos-fallen-unicorn.asp
