Feds Prod Theranos in Criminal Probe

SEC, DoJ now involved in investigations into blood-testing company
By Jenn Gidman,  Newser Staff
Posted Apr 19, 2016 10:03 AM CDT
Feds Prod Theranos in Criminal Probe
Elizabeth Holmes, founder and CEO of Theranos, speaks at the Fortune Global Forum in San Francisco on Nov. 2, 2015.   (AP Photo/Jeff Chiu)

A success story gone sour has taken a new turn for Theranos and founder Elizabeth Holmes, with the SEC and the US attorney's office for the Northern District of California now conducting criminal investigations to determine whether the blood-testing company misled investors and others about its technologies, CNNMoney reports. Theranos has taken heat for what was once thought to be a revolutionary way of testing blood on just a finger prick, with allegations including shoddy QA procedures and a lack of response to complaints. Sources tell the Wall Street Journal that both Walgreens Boot Alliance (parent of Walgreens, which houses dozens of Theranos wellness centers) and the New York State Department of Health have received subpoenas asking for "broad information" on how Theranos represented itself while pushing its technologies and how well it was developing these technologies.

The Journal has done much of the deep digging into Theranos, including an October article that detailed its troubles. Theranos provided a memo to CNN stating the latest probes started "following the publication of certain news articles" and that the company "continues to work closely with regulators and is cooperating fully." It also notes that an FDA probe and investigations by the state health departments of Arizona and Pennsylvania had been "successfully closed out." Meanwhile, Holmes appeared on the Today show Monday and said she was unaware of lacking oversight within her company, per Ars Technica. "Probably the most devastating part of this is that I thought we did [have protocols in place]," she said. She also doesn't think Theranos' flawed results put lives in danger, per the Today report. (More Theranos stories.)

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