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Theranos didn’t work with the huge drug company it supposedly made money from

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Re: Theranos didn’t work with the huge drug company it supposedly made money from

#81

Post by joezydeco »

msandford wrote: post #76
tvladeck wrote: post #20

Earlier quoted context omitted.

> How can you perform live tests on patients and still be in stealth mode? That really hit the nail on the head for me.

From an old article on the subject: http://fortune.com/2014/06/12/theranos-blood-holmes/ The tl;dr is that Theranos makes their own machines, which makes every test that they perform technically a "Lab Developed Test" LDT which doesn't have the same oversight that machines which are sold to others. As long as they make their machines and use their machines, they're effectively exploiting a loophole. From the article:…

Beautiful explanation. Thanks.

Re: Theranos didn’t work with the huge drug company it supposedly made money from

#82

Post by 7Figures2Commas »

cowsandmilk wrote: post #75
erobbins wrote: post #28

Earlier quoted context omitted.

"this graph looks like a hockey stick, how's $50 million?"

to be fair, their competition has well-known financials. The size of the existing market for blood tests is already large; any penetration would give you a sizable business.

"If this company obtains 1% of a $500 billion market, things will be great!" is not due diligence. Here, everything realistically comes down to the technology because the company's ability to gain and sustain market share is almost wholly dependent on it having a superior technology.

Re: Theranos didn’t work with the huge drug company it supposedly made money from

#83

Post by reality_TV »

notacoward wrote: post #5

This company is looking less and less like they're struggling to develop new technology, more and more like a deliberate sham. Given that so much of their support thus far has been due solely to the Cult of Disruption, I can't help but wonder if news like this might make at least a few investors consider a return to good old-fashioned due diligence before placing their bets.

Seeing this story slightly riles me up.

My favorite uncle has a brother who is rich behind wildest dreams. He invested in this supposed unicorn. What did or does she do to get rich people to pull out their wallets and possibly dump their money down the drain?

I, on the other hand have so much opportunity knocking at my door (demoing my tech to Google, Samsung, about to go onto an inventor reality tv show and tons more), yet am unable to connect with the same rich people including my uncle's brother.

As they say it only takes one wealthy person to invest in you and others will follow. Not sure what other signals that need to happen to show him and or others that based on my history I should be given a similar shot. Been at this for 8 years and these amazing opportunities continue to knock and knock. All opportunities are a huge honor, yet extremely frustrating when you don't have the resources to take advantage of it all!

Re: Theranos didn’t work with the huge drug company it supposedly made money from

#84

Post by chc »

saryant wrote: post #79
joezydeco wrote: post #77

Earlier quoted context omitted.

Given how loaded her board is with insanely high-ranking ex-government officials, you can pretty almost certain that any federal prosecution will not happen.

The same was true of Enron's board and they still saw prison time. edit: Apparently I wasn't clear. Enron's board was also stacked with high-ranking politicians and many executives still saw jail time. My point was that a well-connected board won't necessarily shield executives from prosecution.

Enron's board wasn't just outfoxing accredited investors, it was taking advantage of the company's accounting fraud to engage in insider trading.

Re: Theranos didn’t work with the huge drug company it supposedly made money from

#85

Post by nilkn »

saryant wrote: post #79
joezydeco wrote: post #77

Earlier quoted context omitted.

Given how loaded her board is with insanely high-ranking ex-government officials, you can pretty almost certain that any federal prosecution will not happen.

The same was true of Enron's board and they still saw prison time. edit: Apparently I wasn't clear. Enron's board was also stacked with high-ranking politicians and many executives still saw jail time. My point was that a well-connected board won't necessarily shield executives from prosecution.

Enron defrauded the public, not just accredited investors.

Re: Theranos didn’t work with the huge drug company it supposedly made money from

#86

Post by x0x0 »

saryant wrote: post #79
joezydeco wrote: post #77

Earlier quoted context omitted.

Given how loaded her board is with insanely high-ranking ex-government officials, you can pretty almost certain that any federal prosecution will not happen.

The same was true of Enron's board and they still saw prison time. edit: Apparently I wasn't clear. Enron's board was also stacked with high-ranking politicians and many executives still saw jail time. My point was that a well-connected board won't necessarily shield executives from prosecution.

accounting fraud, not "optimism" (various definitions of optimism)

Re: Theranos didn’t work with the huge drug company it supposedly made money from

#87

Post by downandout »

tptacek wrote: post #44
downandout wrote: post #40

Earlier quoted context omitted.

My take on it is that Elizabeth Holmes set out to make this idea a reality, but has been unable to do so. Sadly, all signs point to her trying to buy time via smoke and mirrors. If she has misled investors in the same way she has misled the media, given that she has raised $400 million, she's looking at decades in federal prison. I see this whole thing ending in tragedy, whether that just means the loss of $400 milli…

Prosecution seems fabulously unlikely, given how infrequently founders have gotten in trouble with the law for misleading their investors. Holmes won't be close to the most lurid bad-faith founder claim (if that's how the story indeed ends). This is why we have investor "accreditation".

You'd be amazed at the seemingly minor misrepresentations that a federal prosecutor can turn into a fraud case. That said, whether or not it gets that far depends entirely on the how the investors feel about it, exactly what they were told, whether they choose to report it as a crime to the FBI, etc.

Re: Theranos didn’t work with the huge drug company it supposedly made money from

#88

Post by sixQuarks »

tptacek wrote: post #44
downandout wrote: post #40

Earlier quoted context omitted.

My take on it is that Elizabeth Holmes set out to make this idea a reality, but has been unable to do so. Sadly, all signs point to her trying to buy time via smoke and mirrors. If she has misled investors in the same way she has misled the media, given that she has raised $400 million, she's looking at decades in federal prison. I see this whole thing ending in tragedy, whether that just means the loss of $400 milli…

Prosecution seems fabulously unlikely, given how infrequently founders have gotten in trouble with the law for misleading their investors. Holmes won't be close to the most lurid bad-faith founder claim (if that's how the story indeed ends). This is why we have investor "accreditation".

I wouldn't be too sure about that. Investor fraud isn't the only thing we're talking about here. There are questions about the accuracy of the blood tests themselves.

Re: Theranos didn’t work with the huge drug company it supposedly made money from

#89

Post by trhway »

seansmccullough wrote: post #70
notacoward wrote: post #5

This company is looking less and less like they're struggling to develop new technology, more and more like a deliberate sham. Given that so much of their support thus far has been due solely to the Cult of Disruption, I can't help but wonder if news like this might make at least a few investors consider a return to good old-fashioned due diligence before placing their bets.

$400 million down the drain. Great job VCs. "She's a Stanford dropout with an idea!!!" Is not due diligence.

as history shows one have to be either a Harvard dropout or a Stanford graduate. Not understanding the difference here is like not understanding a difference between finger-prick and venous blood samples :)

Re: Theranos didn’t work with the huge drug company it supposedly made money from

#90

Post by semi-extrinsic »

ameyamk wrote: post #34

I just wonder instead of going back and forth and create more controversy - why don't they just show which tests are working right now - and which don't. Demonstrating with data is the best defense they can put forth. its ok - if only small portion of tests are valid at this point but if they show progress with data - this validates they are on the right track.

They have one test which is FDA approved, for herpes simplex.
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