Theranos CEO admits adding Big Pharma logos to lab reports • The Register
Theranos boss Elizabeth Holmes admitted in court this week that she personally added the Pfizer and Schering-Plow logos to her startup’s presentations while trying to strike a deal with Walgreens.
Testifying in her fraud trial on Tuesday, the ex-CEO damningly revealed it was her idea to place the pair of Big Pharma logos on Theranos reports and then send them to executives at Walgreens.
Holmes is battling charges that she defrauded and conspired to defraud investors of hundreds of millions of dollars by grossly exaggerating the capabilities of her company’s technology.
Here’s the process for that admission: Pfizer and Schering-Plow produced due diligence reports on Theranos for the imploding startup. Theranos staff took these documents and then created their own lab reports bragging about the supposed effectiveness of their blood testing machines. These files, adorned with the Pfizer and Schering-Plow logos apparently to give them credibility, were then shared with investors and senior executives at US drugstore chain Walgreens.
But Pfizer and Schering-Plow staff testified Theranos was not allowed to use the logos, and they didn’t even know the logos were used that way. It is also said that the two pharmaceutical giants disagreed with the final reports produced by Theranos and walked away from the upstart.
Holmes has now told a jury that she added the logos due to her company’s previous relationship with Pfizer and Schering-Plow, and claimed she did not do this to trick anyone into believing the pair had approved the lab reports.
“This work was done in partnership with these companies and I was trying to pass it on,” she said, NBC reported, adding: “I wish I had done it differently.”
Holmes said the increase in the document took place to win a contract to provide blood testing services to Walgreens. She also admitted that these blood tests were not done with Theranos equipment but with modified commercially available testing equipment.
Holmes said a high demand for testing has forced his company to pass in-store testing at a centralized lab where third-party systems have been installed. She said commercial blood testers had been modified and optimized by Theranos to use less blood for testing and that she could not tell her investors because it was a trade secret.
Holmes said she was concerned that if the makers of the equipment knew how Theranos modified their devices, they could have reverse engineered the technology and sold it themselves. She insisted she did not mislead investors and business partners by keeping them from the truth about Theranos’ testing regime, whereby he used standard hardware rather than his own machines.
His defense cited an email exchange between Holmes and Theranos chief scientist Ian Gibbons discussing the progress made on the startup’s blood testing equipment. “Our immunoassays are the best that can be done in clinical laboratories and work with small blood samples. In general, our tests are a factor of three to ten faster than the kits, ”Gibbons wrote.
Holmes said she takes this to mean that her products can actually perform as advertised. But, as has been claimed before, the Theranos material was extremely inaccurate, getting it wrong more than 51% of the time. The full picture may never be known, as the company’s test results database was mysteriously lost in 2018.
Holmes, who denies any wrongdoing, faces two counts of conspiracy to commit wire fraud and nine counts of wire fraud. His trial continues. ®