Scandal-hit United States blood-testing start-up Theranos is to formally dissolve, the firm's chief executive David Taylor has told shareholders in an email. The paper notes only CEO David Taylor "and a handful of support staff" will remain at work "for a few more days". He told shareholders that since April the investment bank Jefferies Group has reached out on the behalf of the company to numerous potential buyers.
What happened? How did Theranos's investors and believers get it so wrong?
Cue a slew of lawsuits, commercial challenges and investigations from investors and medical regulators alike, with titans like the US Securities and Exchange Commission (SEC) and Centers for Medicare and Medicaid Services (CMS) wading in on the action against Theranos.
"She is now telling people she is going to start a new company", he said. Holmes and the company's former COO and president Ramesh "Sunny" Balwani allegedly engaged in a multimillion dollar scheme to defraud investors, as well as a scheme to defraud doctors and patients, according to prosecutors.
If convicted, they could face prison sentences that would keep them behind bars for the rest of their lives, and total fines of $3.69m each. The blood-testing company is seeking to keep part of its remaining assets to pay off investors. Former CEO Elizabeth Holmes' black turtleneck and lofty goals drew comparisons with Apple's Steve Jobs. Founded in 2003 by then teen-age Stanford dropout Elizabeth Holmes, Theranos grew into a $9 billion firm based on its promise of a blood test requiring only a finger prick, rather than a vial of blood. The pharmacy chain has said it was misled by Theranos about its technology and prospects. In reality, the SEC says, the analyzer could only complete a small number of tests, and the company "conducted the vast majority of patient tests on modified and industry-standard commercial analyzers manufactured by others". Its failure was dramatic and painful for many.
The current liquidation process could mean it takes 6 to 12 months for creditors to receive Theranos' remaining cash. However, an expose on the company's proprietary technology in 2015 saw her lose everything and nearly go bankrupt.
The company did not immediately respond to Ars' request for comment. It saw a slight rise in early 2018, perhaps when there was hope left for the company, but it has since sunk to 2.8 out of 5.