Clinical laboratories and point-of-care settings may have a new diagnostic test if this novel handheld device and related technology is validated by clinical trials
Efforts to develop breath analyzers that accurately identify viral infections, such as SARS-CoV-2 and Influenza, have been ongoing for years. The latest example is ViraWarn from Opteev Technologies in Baltimore, Maryland, and its success could lead to more follow-up PCR tests performed at clinical laboratories.
“Breath is one of the most appealing non-invasive sample types for diagnosis of infectious and non-infectious disease,” said Opteev in its FDA Pre-EUA application. “Exhaled breath is very easy to provide and is less prone to user errors. Breath contains a number of biomarkers associated with different ailments that include volatile organic compounds (VOCs), viruses, bacteria, antigens, and nucleic acid.”
Further clinical trials and the FDA Pre-EUA are needed before ViraWarn can be made available to consumers. In the meantime, Opteev announced that the CES (Consumer Electronic Show) had named ViraWarn as a 2023 Innovation Award Honoree in the digital health category.
“ViraWarn is designed to allow users an ultra-fast and convenient way to know if they are spreading a dangerous respiratory virus. With a continued increase in COVID-19 and a new surge in RSV and influenza cases, we’re eager to bring ViraWarn to market so consumers can easily blow into a personal device and find out if they are positive or negative,” said Conrad Bessemer (above), Opteev President and Co-Founder, in a news release.
Opteev is a subsidiary of Novatec, a supplier of machinery and sensor technology, and a sister company to Prophecy Sensorlytics, a wearable sensors company.
The ViraWarn breath analyzer uses a silk-based sensor that “traces the electric discharge of respiratory viruses coupled with an artificial intelligence (AI) processor to filter out any potential inaccuracies,” according to the news release.
Here is how the breath analyzer (mouthpiece, attached biosensor chamber, and attached printed circuit board chamber) is deployed by a user, according to the Opteev website:
The user turns on the device and an LED light indicates readiness.
The user blows twice into the mouthpiece.
A carbon filter stops bacteria and VOCs and allows virus particles to pass through.
As “charge carriers,” virus particles have a “cumulative charge.”
Electrical data are forwarded to the AI processor.
The AI processer delivers a result.
Within 60 seconds, a red signal indicates a positive presence of a virus and a green signal indicates negative one.
“The interaction of the virus with a specially designed liquid semiconductive medium, or a solid polymer semiconductor, generates changes in the conductivity of the electrical biosensor, which can then be picked up by electrodes. Such electrical data can be analyzed using algorithms and make a positive or negative call,” explains an Opteev white paper on the viral screening process.
While the ViraWarn breath analyzer can identify the presence of a virus, it cannot distinguish between specific viruses, the company noted. Therefore, a clinical laboratory PCR test is needed to confirm results.
Other Breath Tests
Opteev is not the only company developing diagnostic tests using breath samples.
For clinical laboratory managers and pathologists, Opteev’s ViraWarn is notable in breath diagnostics development because it is a personal hand-held tool. It empowers people to do self-tests and other disease screenings, all of which would need to be confirmed with medical laboratory testing in the case of positive results.
Further, it is important to understand that consumers are the primary target for this novel diagnostic device. This is consistent with investor-funding companies wanting to develop testing solutions that can be used by consumers. At the same time, a device like ViraWarn could be used by clinical laboratories in their patient service centers to provide rapid test results.
Sickle cell patients and others who need long-term blood transfusions provided by clinical laboratories and others would benefit most from successfully lab-grown blood
Administering lab-developed red blood cells in humans in a clinical study conducted in the United Kingdom (UK) is being hailed as a significant step forward in efforts to supplement the supply of whole blood through the development of synthetic blood products. Of interest to those clinical laboratory managers overseeing hospital blood banking services, researchers were able to create this new blood product from normal blood pints collected from donors.
What caused this clinical study to gain wider attention is the fact that previous attempts to create synthetic whole blood products have proved to be unsuccessful. For that reason, this new research has raised hopes that lab-grown blood may be just around the corner.
The initiative, known as RESTORE, is a joint research project conducted by scientists from the UK’s:
According to the researchers, it is the first such clinical trial performed in the world. Partial funding for this clinical study was provided by an NIHR grant, according to an NHS press release.
Most hospital laboratories also manage a blood bank. Thus, this breakthrough will be of interest to many clinical laboratory managers and blood bankers who are concerned about the shortage of blood products. Plus, blood products are quite expensive. This research could develop solutions that both ease the tight supply of blood and lower the cost of these critical products while improving patient care.
“This research, backed by government investment, represents a breakthrough for patients and means treatment could be transformed for those with diseases including sickle cell,” said Neil O’Brien (above), Minister of State for Health, in an NHS press release. “Once again this shows the UK is leading the world when it comes to scientific innovation and collaboration while delivering high quality care to those who need it the most,” he added. If the lab-grown products prove clinically viable, medical laboratories in the UK may soon suffer less from a shortage of available blood. (Photo copyright: UK Parliament.)
Manufacturing Blood from Stem Cells
“This world-leading research lays the groundwork for the manufacture of red blood cells that can safely be used to transfuse people with disorders like sickle cell,” hematologist Farrukh Shah, MD, Medical Director Transfusion, NHS Blood and Transplant, told BBC News. “The need for normal blood donations to provide the vast majority of blood will remain. But the potential for this work to benefit hard-to-transfuse patients is very significant.”
The process of manufacturing blood cells starts with a normal donation of a pint of blood. The researchers then use magnetic beads to single out flexible stem cells that can become red blood cells. Those flexible stem cells are grown in large quantities in the lab and then guided to transform into red blood cells.
“This challenging and exciting trial is a huge stepping stone for manufacturing blood from stem cells,” said Ashley Toye, PhD, Professor of Cell Biology at the University of Bristol in the NHS press release. “This is the first-time lab grown blood from an allogeneic donor has been transfused and we are excited to see how well the cells perform at the end of the clinical trial.”
The process to create the lab-grown blood cells takes about three weeks, and a pool of approximately half a million stem cells can result in 50 billion red blood cells. These cells are then clarified further to reap about 15 billion red blood cells that are at the optimum level to transplant into a human patient.
“Some blood groups are extremely rare, to the point that only 10 people in a country can donate blood,” Toye told BBC News. “We want to make as much blood as possible in the future, so the vision in my head is a room full of machines producing it continually from a normal blood donation.”
Transforming Care for Patients Who Need Long-term Blood Transfusions
To date, only two patients have taken part in the clinical trial. Next, the researchers plan to perform two mini transfusions on 10 volunteers at least four months apart. One transfusion will contain traditional donated red blood cells and the other will consist of the lab-grown cells. This experiment will show which blood cells last longer in the body. The findings could ultimately allow a patient to receive fewer transfusions and prevent iron overload, which can be a side effect of blood transfusions.
“We hope our lab-grown red blood cells will last longer than those that come from blood donors,” said Cédric Ghevaert, MD, Senior Lecturer in Transfusion Medicine at the University of Cambridge, in the NHS press release. “If our trial—the first such in the world—is successful, it will mean that patients who currently require regular long-term blood transfusions will need fewer transfusions in the future, helping transform their care.”
More research and clinical trials will be necessary to validate the efficacy and safety of these lab-grown blood products. However, such a breakthrough could potentially revolutionize treatments for patients with blood disorders, complex transfusion needs, and rare blood types, as well as reduce healthcare costs and curb blood shortages.
At the same time, this technology would also contribute to expanding the supply of useful blood products, a development that would be welcomed by those pathologists and clinical laboratory professionals overseeing the blood banks in their respective hospitals and integrated delivery networks (IDNs).
Google designed the suite to ease radiologists’ workload and enable easy and secure sharing of critical medical imaging; technology may eventually be adapted to pathologists’ workflow
Clinical laboratory and pathology group leaders know that Google is doing extensive research and development in the field of cancer diagnostics. For several years, the Silicon Valley giant has been focused on digital imaging and the use of artificial intelligence (AI) algorithms and machine learning to detect cancer.
Now, Google Cloud has announced it is launching a new medical imaging suite for radiologists that is aimed at making healthcare data for the diagnosis and care of cancer patients more accessible. The new suite “promises to make medical imaging data more interoperable and useful by leveraging artificial intelligence,” according to MedCity News.
In a press release, medical technology company Hologic, and healthcare provider Hackensack Meridian Health in New Jersey, announced they were the first customers to use Google Cloud’s new suite of medical imaging products.
“Hackensack Meridian Health has begun using it to detect metastasis in prostate cancer patients earlier, and Hologic is using it to strengthen its diagnostic platform that screens women for cervical cancer,” MedCity News reported.
“Google pioneered the use of AI and computer vision in Google Photos, Google Image Search, and Google Lens, and now we’re making our imaging expertise, tools, and technologies available for healthcare and life sciences enterprises,” said Alissa Hsu Lynch (above), Global Lead of Google Cloud’s MedTech Strategy and Solutions, in a press release. “Our Medical Imaging Suite shows what’s possible when tech and healthcare companies come together.” Clinical laboratory companies may find Google’s Medical Imaging Suite worth investigating. (Photo copyright: Influencive.)
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Easing the Burden on Radiologists
Clinical laboratory leaders and pathologists know that laboratory data drives most healthcare decision-making. And medical images make up 90% of all healthcare data, noted an article in Proceedings of the IEEE (Institute of Electrical and Electronics Engineers).
More importantly, medical images are growing in size and complexity. So, radiologists and medical researchers need a way to quickly interpret them and keep up with the increased workload, Google Cloud noted.
“The size and complexity of these images is huge, and, often, images stay sitting in data siloes across an organization,” said Alissa Hsu Lynch, Global Lead, MedTech Strategy and Solutions at Google, told MedCity News. “In order to make imaging data useful for AI, we have to address interoperability and standardization. This suite is designed to help healthcare organizations accelerate the development of AI so that they can enable faster, more accurate diagnosis and ease the burden for radiologists,” she added.
According to the press release, Google Cloud’s Medical Imaging Suite features include:
Imaging Storage: Easy and secure data exchange using the international DICOM (digital imaging and communications in medicine) standard for imaging. A fully managed, highly scalable, enterprise-grade development environment that includes automated DICOM de-identification. Seamless cloud data management via a cloud-native enterprise imaging PACS (picture archiving and communication system) in clinical use by radiologists.
Imaging Lab: AI-assisted annotation tools that help automate the highly manual and repetitive task of labeling medical images, and Google Cloud native integration with any DICOMweb viewer.
Imaging Datasets and Dashboards: Ability to view and search petabytes of imaging data to perform advanced analytics and create training datasets with zero operational overhead.
Imaging AI Pipelines: Accelerated development of AI pipelines to build scalable machine learning models, with 80% fewer lines of code required for custom modeling.
Imaging Deployment: Flexible options for cloud, on-prem (on-premises software), or edge deployment to allow organizations to meet diverse sovereignty, data security, and privacy requirements—while providing centralized management and policy enforcement with Google Distributed Cloud.
First Customers Deploy Suite
Hackensack Meridian Health hopes Google’s imaging suite will, eventually, enable the healthcare provider to predict factors affecting variance in prostate cancer outcomes.
“We are working toward building AI capabilities that will support image-based clinical diagnosis across a range of imaging and be an integral part of our clinical workflow,” said Sameer Sethi, Senior Vice President and Chief Data and Analytics Officer at Hackensack, in a news release.
The New Jersey healthcare network said in a statement that its work with Google Cloud includes use of AI and machine learning to enable notification of newborn congenital disorders and to predict sepsis risk in real-time.
Hologic, a medical technology company focused on women’s health, said its collaboration integrates Google Cloud AI with the company’s Genius Digital Diagnostics System.
“By complementing our expertise in diagnostics and AI with Google Cloud’s expertise in AI, we’re evolving our market-leading technologies to improve laboratory performance, healthcare provider decision making, and patient care,” said Michael Quick, Vice President of Research and Development and Innovation at Hologic, in the press release.
Hologic says its Genius Digital Diagnostics System combines AI with volumetric medical imaging to find pre-cancerous lesions and cancer cells. From a Pap test digital image, the system narrows “tens of thousands of cells down to an AI-generated gallery of the most diagnostically relevant,” according to the company website.
Hologic plans to work with Google Cloud on storage and “to improve diagnostic accuracy for those cancer images,” Hsu Lynch told MedCity News.
Medical image storage and sharing technologies like Google Cloud’s Medical Imaging Suite provide an opportunity for radiologists, researchers, and others to share critical image studies with anatomic pathologists and physicians providing care to cancer patients.
One key observation is that the primary function of this service that Google has begun to deploy is to aid in radiology workflow and productivity, and to improve the accuracy of cancer diagnoses by radiologists. Meanwhile, Google continues to employ pathologists within its medical imaging research and development teams.
Assuming that the first radiologists find the Google suite of tools effective in support of patient care, it may not be too long before Google moves to introduce an imaging suite of tools designed to aid the workflow of surgical pathologists as well.
Two former FDA commissioners who support changing oversight of laboratory-developed tests (LDTs) say FDA’s regulatory playbook is ‘outdated’
Congress’ attempts to avoid a government shutdown due to a lack of funding presents a final chance this year for two different clinical laboratory bills to be pushed through.
As Dark Daily’s sister publication The Dark Report, noted in “VALID and SALSA Acts Still Pending in Congress,” a standalone vote on either bill is unlikely this year. Instead, they would need to be attached to the larger spending bill. (If you’re not a subscriber to The Dark Report, check out our free trial.)
In an article for STAT, former FDA Commissioners Scott Gottlieb, MD (left), and Mark McClellan, MD, PhD (right), wrote, “The FDA is currently working from an outdated regulatory playbook that has left gaps in its oversight of safety and effectiveness and makes it more difficult to introduce new innovations. The [VALID Act] would strengthen protections for consumers and patients for both diagnostic tests and cosmetics and make it easier for manufacturers to introduce better products.” (Photo copyrights: FDA/American Well.)
Political Parties Negotiating
At press time, a draft spending bill had not yet been introduced to Congress as lawmakers from both political parties negotiate funding levels.
A source told The Dark Report that until legislators hammer out those details, add-ons such as the VALID Act or SALSA are stalled. There is no guarantee either lab measure will be added to the spending bill.
“We don’t have agreements to do virtually anything,” said Senate Minority Leader Mitch McConnell (R-KY) to reporters on Dec. 6, according to Reuters. “We don’t even have an overall agreement on how much we want to spend,” he added. Reuters reported that Democrats and Republicans in the Senate were $25 billion apart in their proposals.
Congress could also pass a continuing resolution to keep the government open for a short time, which would allow lawmakers more opportunity to negotiate.
Former FDA Chiefs Weigh In
Meanwhile, proponents of the VALID Act have publicly turned the heat up for the bill. For example, STAT recently ran two commentaries—including a joint piece from a pair of former FDA commissioners—in support of the VALID Act.
Currently, LDTs are regulated through the Clinical Laboratory Improvement Amendments of 1988 (CLIA). However, supporters of the VALID Act argue that the complexity of modern LDTs deserves more scrutiny.
“The VALID Act would create a consistent standard for all tests, regardless of the kind of facility they were developed in or made in, as well as a modern regulatory framework that’s uniquely designed for the recent and emerging technologies being used to develop tests,” wrote Scott Gottlieb, MD, and Mark McClellan, MD, PhD, in STAT on Dec. 5.
Gottlieb and McClellan served as FDA commissioners from 2017-2019 and 2002-2004 respectively. They both currently serve on various boards for biotech and healthcare companies.
Pathologists, Clinical Lab Directors Express Concerns about VALID Act
Opponents of the VALID Act contend that LDT innovation will be stifled if clinical laboratories, particularly those at academic medical centers, need to spend the time and money to go through formal FDA approval. There is evidence that working pathologists in academic settings have legitimate concerns about the negative consequences that might result if the VALID Act was passed as currently written.
In “Might Valid Act Support Be Waning in Congress?” The Dark Report covered how on June 1 more than 290 pathologists and clinical laboratory directors sent a grassroots letter to a Senate committee asking for a series of concessions to be made for academic medical center labs under the VALID Act.
It is reasonable to assert that the majority of clinical laboratory professionals and pathologists are supportive of the SALSA bill, which would stop the next round of scheduled price cuts—as much as a 15% price reduction to many tests—to the Medicare Part B Clinical Laboratory Fee Schedule (CLFS). That is not true of support for the VALID Act, as currently written. Sizeable segments of the diagnostics industry have taken opposing positions regarding passage of that legislation.
For these reasons, both bills will be closely watched in coming weeks as Congress works to fund the federal government while, at the same time, incorporating a variety of other bills under the omnibus bill, which is a considered a “must pass” by many senators and representatives.
As 3D printing technology gains acceptance with pharmaceutical companies, clinical laboratories could see increased demand for pharmacogenomic testing
Will physicians someday “print” prescription drugs for patients in-office? It sounds like science fiction, but research being conducted at the University College London (UCL) indicates the capability may be closer than we think, and it could bring about a new type of collaboration between clinical laboratories, ordering physicians, and pharmacies.
UCL’s new 3D technique, which it calls “volumetric 3D printing,” is intended to enable the pharmaceutical industry to tailor drug dosage, shape/size, and release to an individual patient’s needs and preference. A key element of precision medicine.
According to GlobalData Healthcare, 3D printing also can “significantly reduce cost, wastes, and economic burden as printers only deposit the exact amount of raw materials required.”
3D printing may enable pharmaceutical companies to address gender and racial disparities in prescription drug manufacturing through a developing technology that could have implications for clinical laboratory testing. Fred Parietti, PhD (above), co-founder and CEO of Multiply Labs, a technology company that develops robotics for precision medicine pharmaceuticals, told 3D Natives, “Currently, medications are developed especially for white adult men, which means that all women and children have an excessive prescription for their bodies. This fact underlines the importance of the advent of personalized medicines, as well as highlighting the individuality of each patient, since the error in the dosage of certain active ingredients can even lead to the malfunctioning of some treatments.” (Photo copyright: Multiply Labs.)
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Increased Demand for Pharmacogenomic Testing
Though 3D printing of prescription drugs is not directly in the clinical laboratory/pathology space, it is noteworthy because it shows how technological advancements are progressing that actualize the ability to deliver precision medicine care to individual patients.
In turn, this could increase physician/patient demand for pharmacogenomic tests performed by clinical laboratories. The test results would be used by treating physicians to determine proper dosages for their individual patients prior to ordering 3D-printed drugs.
Being able to provide medication tailored to patients’ specific needs could bring about a revolution in pharmaceutical manufacturing. If 3D printed prescription drugs become mainstream, the demands could affect the clinical laboratory and pathology industries as well.
How Far Are We from Mass Production of 3D Printed Drugs?
The first and only 3D printed pharmaceutical drug on the American market is Spritam (levetiracetam) an anti-epileptic drug developed by Aprecia Pharmaceuticals, according to Medical Device Network. It received FDA clearance under the name Keppra in 1999.
Headquartered in Blue Ash, Ohio, Aprecia’s patented ZipDose manufacturing process allows 3D-printed pills to hold a larger dosage and dissolve rapidly. They currently have the only FDA process-validated 3D printing platform for commercial-scale drug production. They are leading the way on this new 3D technology and others are following suit.
FabRx, a start-up 3D printing company developed by academic researchers in 2014 at the University College London, released its first pharmaceutical 3D printer for personalized medicine called M3DIMAKER according to LabioTech.eu. The system is “controlled by specialized software, allowing the selection of the required dose by the pharmacist according to the prescription given by the clinician,” the company’s website notes.
The technology also allows for additional customization of pills, including the application of Braille for visually impaired patients, and printing of Polypills, which combine more than one drug into a single pill.
Other company’s developing 3D printing of pharmaceuticals, according to LabioTech.eu, include:
Germany’s Merck: currently in clinical trials of 3D printing medication with the goal of reaching large scale production.
China’s Triastek: which holds “41 patents that account for more than 20% of global 3D printing pharmaceuticals applications.”
We are still far away from large scale production of drugs using 3D printing, but that doesn’t mean it should not be on clinical laboratory leaders’ radar.
The rise of 3D printing technology for precision medicine could lead to big changes in the pharmaceutical world and alter how patients, providers, and clinical laboratories interact. It also could increase demand for pharmacogenomic testing to determine the best dosage for individual patients. This breakthrough shows how one line of technology research and development may, as it reaches clinical use, engage clinical laboratories.
Judge will decide the restitution Holmes must pay to defrauded Theranos investors at future court date; Ex-COO Ramesh “Sunny” Balwani to be sentenced next month
Clinical laboratory leaders and anatomic pathologists who closely followed the fraud trial of Elizabeth Holmes may have wondered how the Theranos founder and ex-CEO would be punished for her crimes. Now we know.
Late into the four-hour sentencing hearing, Holmes tearfully spoke, according to a twitter post by NBC reporter Scott Budman, who was in the courtroom. “I am devastated by my failings,” Holmes said. “I have felt deep pain for what people went through because I have failed them … To investors, patients, I am sorry.”
Davila ordered Holmes to surrender to authorities on April 27 to begin her time behind bars. She is free until that time. Her upcoming prison term caps off one of the biggest downfalls ever of an American entrepreneur.
Elizabeth Holmes (above), founder and former CEO of Theranos, the now defunct clinical laboratory company, as she enters the federal courthouse in San Jose, Calif., prior to her sentencing on Friday. In January, Holmes was convicted on three counts of wire fraud and one count of conspiracy. Last summer, Theranos’ former CLIA laboratory director, pathologist Adam Rosendorff, MD, expressed remorse over his testimony which led to Holmes’ defense team requesting a new trial. The judge denied that request and allowed the sentencing of Holmes to proceed as scheduled. (Photo copyright: Jim Wilson/The New York Times.)
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Defense Lawyers Plan to Appeal
Dean Johnson, JD, a California criminal defense lawyer, told NBC Bay Area News during live coverage of the hearing on Friday that Holmes’ defense team will appeal her conviction.
“I have no doubt there will be an appeal in this case,” Johnson said.
Judge Edward Davila, who oversaw Holmes’ trial and sentencing hearing in US District Court in San Jose, Calif., estimated that the total loss for Theranos investors was $121 million. Investors had committed funds to support the company’s flawed Edison blood testing technology. A separate restitution hearing for Holmes will be scheduled for a later date.
Beyond the sentencing, Holmes, 38, will be saddled by infamy for the rest of her life, with her past reputation as a charismatic innovator ruined.
“The judge [said] evidence shows Elizabeth Holmes was leader of the company, but not necessarily the leader of the criminal acts,” Budman tweeted. Those words clearly pointed to Balwani, who Holmes’ defense team had painted as exerting control over her and the company.
Prosecutors Sought a Stiffer Sentence for Holmes
Prosecutors had asked Davila to sentence Holmes to 15 years in prison, arguing that her conviction represented “one of the most substantial white collar offenses Silicon Valley or any other district has seen,” according to NBC Bay Area News, which cited court documents. The government also wanted her to pay $803 million in restitution.
Holmes’ defense team, however, wished for no prison time at all, instead asking that Holmes serve time under house arrest. “If a period of confinement is necessary, the defense suggests that a term of 18 months or less, with a subsequent supervised release period that requires community service, will amply meet that charge,” her lawyers wrote in a court filing.
Prior to the sentencing, Davila received 130 letters supporting Holmes and asking for leniency, NPR reported. Among them was a note from William “Billy” Evans, Holmes’ partner.
“If you are to know Liz, it is to know that she is honest, humble, selfless, and kind beyond what most people have ever experienced,” Evans wrote, NPR reported. “Please let her be free.”
Holmes and Evans have a 16-month-old son together, and she is pregnant with the couple’s second child. Her first pregnancy caused her trial to be rescheduled. Prior to last week’s sentencing, some reporters covering the trial speculated that because Holmes was the mother of an infant—and now pregnant again—the judge might be more lenient in sentencing. The 11-year, four-month sentence indicates that the judge was not much influenced by that factor.
Last Minute Pitch for New Trial Failed
Holmes’ legal wranglings continued until the very end.
However, Rosendorff later told the court that he stood by his testimony about problems with Theranos’ blood testing technology.
In denying the request for a new trial, Davila wrote, “The court finds Dr. Rosendorff’s statements under oath to be credible,” according to The Washington Post.
From Teen Founder to Disgraced Entrepreneur
Holmes founded Theranos in 2003 at age 19 while she was attending Stanford University as a chemical engineering major. She dropped out of Stanford as a sophomore to focus on her new company.
Theranos claimed its technology—known as Edison—could perform diagnostics tests using a finger prick and a micro-specimen vial instead of a needle and several Vacutainers of blood. The company said it could return results to patients and clinicians in four hours for about half of the cost of typical lab test fees.
However, the promise of this technology began to unravel in 2015 following an investigative article by The Wall Street Journal that revealed the company ran only a handful of tests using its technology, instead relying on traditional testing for most of its specimen work.
Following The Journal’s exposé, the Centers for Medicare and Medicaid Services (CMS) sanctioned Theranos and Holmes in 2016. Meanwhile, the US Securities and Exchange Commission (SEC) investigated Holmes for raising hundreds of millions from investors by exaggerating or making false statements about the company’s technology and financial performance.
In 2018, the US Department of Justice (DOJ) indicted Holmes and Balwani, and Theranos closed shortly after.
Fortunately, the Theranos saga has not stunted investment in healthcare technology startups. Spending was in the tens of billions in 2021, although that number has dropped this year as the COVID-19 pandemic has waned, according to TechCrunch. Nevertheless, it is safe to assume that healthcare tech investors are scrutinizing scientific data from startups more thoroughly because of the Theranos fraud case.
Meanwhile, the saga of Theranos continues to leave a bad taste in the mouths of many clinical laboratory managers and pathologists. That’s because, during the peak period of adulation and spectacular news coverage about Elizabeth Holmes and her plans to totally disrupt the clinical laboratory industry, hospital and health system CEOs believed that they would be able to downsize their in-house medical laboratories and obtain lab tests from Theranos at savings of 50% or more. Consequently, during the years 2013 through the end of 2015, some hospital lab leaders saw requests for capital investment in their labs denied or delayed.
One example of how hospital CEOs embraced news of Theranos’ blood testing technology took place at the Cleveland Clinic. Elizabeth Holmes did such a good job selling the benefits of the Edison technology, then-CEO, Toby Cosgrove, MD, placed Theranos at number three on its list of top ten medical innovations for 2015.
In later years, Cosgrove admitted that no one at Cleveland Clinic or its pathologists were allowed to examine the analyzers and evaluate the technology.
It was for these reasons that the demise of Theranos was welcomed by many hospital lab administrators and pathologists. The fact that two of Theranos’ senior executives have been convicted of fraud validates many of the serious concerns that medical laboratory professionals had at that time, but which most major news reporters and media ignored and failed to report to the public.
