Medical lab test company Theranos offered a rebuttal to the critical article about the firm published in the Wall Street Journal last week, but most analysts and experts were not impressed.
The “rebuttal” was notably short on details or proof, and Theranos continues to claim any kind of details about its new Edison small-sample blood testing technology, including the number of tests that are currently performed with Edison, are “trade secrets”, which just adds to the growing cloud of uncertainty and potential fraud surrounding Theranos and it ultra-ambitious founder Elizabeth Holmes.
Problems at Theranos as noted in recent WSJ article
The damning article about Theranos in the WSJ last week was largely based on interviews with four former employees of the company. One key point was that Theranos “does the vast majority of its tests with traditional machines bought from companies like Siemens AG.” While there’s nothing illegal or even unethical about that, it is certainly not a “disruptive business model” using a new technology to drive down lab test prices.
Even though the company will not directly confirm it, multiple sources confirm that as of December 2014, only somewhere between 15 and 20 of the more than 200 tests it offers are performed using the new technology for which it is famous: taking a few drops of blood by and then analyzing that small sample in a compact Edison device.
According to the WSJ sources, another 60 of Theranos’ tests were being performed by finger stick, but were then diluted into greater volume samples so that they could be read by third-party lab test machines. Diagnostic test experts say saying that dilution is not a preferred lab practice, and can produce less reliable results.
The remaining tests on the menu were performed by the traditional venipuncture method, merely using a smaller than ordinary needle which draws a less than usual sized sample, which is then analyzed by conventional third party blood sample diagnostic devices.
The WSJ sources also allege that in the first few months of 2014, company president Sunny Balwani instructed employees to engage in questionable behavior regarding reporting of proficiency tests that the firm must pass to keep its lab certifications. Based in part on internal emails, the WSJ claims that Balwani told Theranos employees to test the regulatory proficiency test sample on a conventional, third-party-manufactured machine, even though Theranos was routinely performing the same diagnostic tests with its Edison system. It seems the third-party machines produced more accurate results than Edison.
The reliability of Theranos’s tests is also called into question by some of the sources, but no direct proof of the claim was offered. In its effort to become a full service medical lab test provider, Theranos is seeking FDA approval for close to 130 of its proprietary tests, and has had one test approved by the FDA.
Keep in mind that while an FDA approval does in effect prove the basic validity of Holmes’ platform, we need Edison approved for at least a half dozen tests before we can really say Theranos’ technology is validated.