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Theranos faces ban
Troubled blood-testing startup Theranos may lose one of its testing facilities and a functional management team following a damning report by federal health regulators.
The Centers for Medicare and Medicaid Services has said it will revoke the company's license for its California lab and prevent its owners – Theranos CEO Elizabeth Holmes and president Sunny Balwani – from owning or running any other lab for at least two years. That would include the company's main lab in Arizona.
The strong measures come after the regulators say the company and its management have failed to fix "major problems" at the California lab. The letter was sent in private on March 18 but a copy was leaked to The Wall Street Journal. Theranos has since replied and the regulator is reviewing its response.
It is just the latest blow to a company once valued at $9bn and hailed as a visionary but which was the subject of a damning investigative report by the WSJ last year which revealed its revolutionary technology was rarely being used by the company and didn't produce reliable results. ®