Theranos founder and CEO Elizabeth Holmes went on CNBC on Oct. 15 to defend her blood testing company after an explosive Wall Street Journal report alleged that the company wasn’t using its theoretically revolutionary blood testing technology — called Edison — for the vast majority of its tests, at least as of the end of 2014.
The story quoted people cited as former employees, who said there were problems with the accuracy of tests performed using the Edison system.
“I personally was shocked” that the Wall Street Journal chose to publish that report, Holmes said on Jim Cramer’s Mad Money show.
“Every test that we offer in our lab can be run on our proprietary devices,” Holmes told Cramer, noting that they have submitted at least 130 of their proprietary tests for FDA approval. (She didn’t say that they do run every test on those devices — only that they can.)
Holmes also said that they have already had their test results compared with the other main lab companies, Quest and LabCorps, at least for the one Theranos test that has received FDA approval, a herpes test.
Still, that one FDA approval doesn’t mean that the same testing method works in all cases. In the Journal story, a former employee of Theranos alleged that the company “failed to report” some test results that would have called into question the accuracy of their proprietary technology.
Holmes also said to Cramer that the sources who spoke to the Journal told Theranos — after being contacted by the company’s very prominent legal team — that they were misrepresented in the story. She also claimed that other sources who spoke with the Journal either asked for money in exchange for speaking further with Theranos or actively did business with the company’s competitors.
Either way, Holmes said on Mad Money, the Journal “focused on sources who we knew, in 2004 in 2005 who said to me there’s no way we can succeed” with this company. That echoed Theranos’ official statement, which alleged that the article was “grounded in baseless assertions by inexperienced and disgruntled former employees and industry incumbents.”
Holmes did not deny that the company uses standard blood-testing technology for many of its tests, though she declined to say whether that was true for most tests offered or only a few. The company began to do many of its tests in a traditional way using needles instead of using their new fingerprick technology so that they could offer many more expensive, specialised tests for a far cheaper price, she said, adding that they have stated that throughout 2015.
“This is what happens when you work to change things,” Holmes said. “First they think you’re crazy, then they fight you, then you change the world.”
The Wall Street Journal report and earlier doubts raised by scientists calls that narrative into question. The only way for Holmes to really prove her critics wrong would be to share more details about the company’s tests and how they work, something Theranos has been reluctant to do, citing trade secrets.
Holmes seems to be making an effort to be more open, actively responding to people on Twitter today and showing up on CNBC to respond to the story, but so far, there are still many questions that remain unaddressed. As Matthew Herper wrote in Forbes: “It’s time for Theranos to provide some answers.”
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