Theranos CEO Holmes Barred From Operating Lab for 2 Years

Theranos CEO Holmes Barred From Operating Lab for 2 Years
Image credit: Bloomberg
2 min read
This story originally appeared on Reuters

A U.S. health regulator has barred blood-testing company Theranos Inc.'s founder and CEO, Elizabeth Holmes, from operating a lab for at least two years, the latest blow for a company that is under scrutiny for the accuracy and quality of its tests.

The Centers for Medicare & Medicaid Services (CMS) revoked a key certificate for the company's Newark, California lab, and terminated the facility's approval to receive Medicare and Medicaid payments for all services, Theranos said late on Thursday.

Theranos, once valued at $9 billion, is also being investigated by other federal and state agencies and was accused in a suit filed in May of endangering customer health through "massive failures" that misrepresented test results, according to court papers.

"While we are disappointed by CMS' decision, we take these matters very seriously and are committed to fully resolving all outstanding issues," Holmes said in a statement.

Holmes, once a Silicon Valley darling, has seen her net worth dwindle to zero from $4.5 billion last year, according to Forbes magazine.

Holmes founded Theranos in 2003 and it promised ground-breaking methods that would allow quick results for a wide range of tests with just one drop of blood.

The company has been under pressure since the Wall Street Journal published a series of reports that had raised doubts about Theranos's devices.

The CMS said in January that Theranos's practices violated several clinical-laboratory regulations, jeopardizing patient health and safety.

(Reporting by Natalie Grover and Ankur Banerjee in Bengaluru; Editing by Saumyadeb Chakrabarty and Sriraj Kalluvila)

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