Theranos CEO Banned from Labs

In case you haven’t heard, Elizabeth Holmes, founder and CEO of Theranos, has been banned from owning or operating a medical lab for at least 2 years.

Once Silicon Valley’s sweetheart startup, Theranos has been under government scrutiny stemming from questions about the effectiveness of its blood testing technology and the way it operates its labs.

According to an inspection report by the Centers for Medicare and Medicaid Services (CMS), which regulates clinical laboratories, Theranos used unqualified or inadequately trained personnel and stored samples in freezers that weren’t at the proper temperature. The report, which was made after an inspection of the company’s laboratory in Newark, California, last fall, also alleged Theranos failed to ensure that the quality control for an important blood-clotting test was acceptable before reporting results for patients.

A previous report released by federal regulators cited Theranos for various deficiencies, including one that posed “immediate jeopardy to patient health and safety.”

In a letter sent to Theranos and made public on July 8, 2016, federal investigators said they’re shutting down the company’s flagship lab later this year, and the laboratory would be prohibited from receiving Medicare and Medicaid payments.

In a statement, Theranos said it’s “working closely with [CMS] to resolve the sanctions that the agency advised it plans to impose on the company’s Newark, California, laboratory and its CLIA certificates.”

Theranos said it would stop patient testing at the California facility immediately and continue to work with regulators to resolve issues. It’s currently closing and rebuilding the lab, as well as bolstering its personnel and training. The company will continue to operate a lab in Arizona. However, if the California lab’s license is revoked, Theranos and Holmes, who’s reportedly staying on as CEO, couldn’t own or operate any laboratory, and the Arizona facility would also have to close.

Meanwhile, Walgreens has backed out of plans to roll out Theranos Wellness Centers inside all of its 8200 pharmacies.