Elizabeth Holmes started the medical testing company Tharanos and promised innovative technology that would use a simple blood test to diagnose an unprecedented number of diseases. However, Holmes ended up facing criminal charges for fraud and her company, once worth $9 billion, no longer exists—why?
• Her blood tests actually injected patients with several dangerous infections
• Her blood tests diagnosed all patients with cancer, even if they were 100% healthy
• She sold her technology to investors as if it existed, but it did not
• Her technology was found to be faulty once it was put into use
• Her technology was found to be faulty once it was put into use
The reason Elizabeth Holmes and her company, Theranos, faced criminal charges for fraud and ultimately dissolved is that her technology was found to be faulty once it was put into use. Holmes had promised innovative technology that would revolutionize the medical testing industry by using a simple blood test to diagnose a wide range of diseases. However, it was later discovered that the technology did not actually work as claimed.
To understand how this happened, it's important to know that Theranos operated in secrecy and heavily promoted its technology without providing much evidence or data to back up its claims. Holmes and her team made bold statements about the effectiveness and accuracy of their blood testing technology, which attracted significant investments from high-profile investors, and at one point, the company was valued at $9 billion.
However, as the technology was put into use and subjected to scrutiny, it became apparent that it did not deliver on its promises. External experts in the medical and scientific community started raising concerns about the validity and reliability of the tests. For example, it was alleged that the blood tests actually injected patients with several dangerous infections or that they diagnosed all patients with cancer, even if they were perfectly healthy.
Ultimately, investigations by regulatory authorities, including the U.S. Food and Drug Administration (FDA) and the Centers for Medicare and Medicaid Services (CMS), found that Theranos had misled investors, doctors, and patients about the capabilities and performance of its technology. The technology was considered faulty and inaccurate, and it posed potential risks to patient health.
As a result, Elizabeth Holmes and her former business partner, Ramesh "Sunny" Balwani, were charged with multiple counts of fraud by the U.S. Department of Justice. Holmes faced a criminal trial, which concluded in 2021 with the verdict still pending as of the time of this response. Theranos, the company she founded, eventually dissolved and its assets were liquidated.
This case serves as a cautionary tale about the importance of transparency, integrity, and scientific rigor in the development and promotion of new technologies, particularly those that have direct implications for patients' health and well-being. It also highlights the need for robust regulation and oversight to prevent fraudulent practices in the healthcare industry.
The correct answer is: Her technology was found to be faulty once it was put into use.
Elizabeth Holmes and Theranos faced legal troubles and eventually shut down because the technology they claimed to have developed was found to be faulty. The blood testing technology, which was supposed to revolutionize medical diagnostics, did not work as promised. When the technology was put into use, it failed to provide accurate results and did not meet regulatory standards. This discovery led to the company losing credibility, facing lawsuits, and ultimately going out of business.