Skip to main content
Premium Trial:

Request an Annual Quote

Theranos's Holmes Banned

Regulators have barred Theranos CEO Elizabeth Holmes from owning or operating a clinical lab for at least two years, the Wall Street Journal reports. The Centers for Medicare & Medicaid Services has also revoked its regulatory approval of the company's California lab and there will be a monetary penalty.

The company "represents the promise and the pitfalls of the start-up era," the New York Times adds. Theranos gained a high profile — and a "unicorn" designation with its $9 billion valuation in 2014 — for its promise to upend the laboratory-testing field by conducting blood tests from a finger-prick's worth of blood.

But, a series of articles in the Wall Street Journal beginning last fall cast doubt on Theranos's technology and its ability to conduct such testing. Regulators then uncovered issues with how the company conducted its tests, and the company faces criminal and other investigations. Theranos has also issued a number of corrected lab reports and lost its retail partner, Walgreens.

Those regulatory issues have now culminated in these sanctions.

"We accept full responsibility for the issues at our laboratory in Newark, California," Holmes says in a statement. She adds that that lab will be shut down and rebuilt "from the ground up."