Holmes jury learns how Theranos duped a savvy health care investor | Hacker News Reader

Holmes jury learns how Theranos duped a savvy health care investor

arstechnica.com

41 pointsnradov10 comments

Grossman continued to press for more information. He spoke with Channing Robertson, who was a Theranos board member and a professor of chemical engineering at Stanford. Over two conversations, Robertson told Grossman that the company’s technology was sound.

This is the most galling part. Dr. Robertson is currently a professor emeritus at Stanford. When Jan Hendrik Schoen [0] was caught doing scientific fraud, his alma mater, University of Konstanz, stripped him of his PhD. I'm not saying Prof. Robertson should be stripped of his PhD, but I feel like Stanford could make at least some symbolic gesture to distance themselves from this affair.

[0] https://en.wikipedia.org/wiki/Sch%C3%B6n_scandal

Episodes like this really highlight how Theranos was not just a case of "Silicon Valley overhyping" taken to an extreme, as has often been portrayed in the media. Flat out lying to investors is a cardinal sin in the Valley, and the line between selling a future vision and what your current capabilities are is not really gray. It would have been one thing to say, for example, that "we plan to be able to run 1000 different tests in a year", and not deliver, vs flat out saying "our technology can run all those tests today", which it most definitely couldn't.

When I first heard about the Theranos meltdown I was so sure that Holmes was a victim of big pharma trashing her name and her company. But man..as the story unfolds in front of us that is obviously not the case. I’m pretty bummed about it because I was really excited a few years ago when the company was so hot. Hopefully some of their tech or ideas are solid and someone really can build on them to make good healthcare products for people.

None of their tech or ideas were ever solid. It is biologically impossible to measure accurate blood levels of all but a few analytes from a fingertip blood drop.

Yeah that’s what I’m understanding now. Really would have been amazing if it were possible. If you’ll indulge me, is there some theoretical technology that could enable such a breakthrough or is it so far from possible that it’s not even feasible for some reason?

No, it's physically impossible. There is plenty of evidence that capillary blood simply isn't homogeneous enough in small volumes to do quantitative analysis.

But honestly, I actually don't think that's much of a big deal. The difference between taking a venous draw and doing a finger stick as not as big of a deal as Theranos made it out to be.

If instead Theranos had a small, portable analysis machine that could work with small volumes of venous blood, and they had a big deal with Walgreens to use that together with things like low, up-front pricing for tests, I think that still would have been a great advance. Note there are startups like Everlywell basically trying to make that vision (cheap, accessible, up-front pricing for medical tests) possible.

Theoretically what could work is to flip things around. Instead of drawing blood from the patient and analyzing it in a lab, miniaturize the lab and implant it in the patient. That way the sensors have continuous direct access to blood or other fluids.

Obviously there are huge challenges to designing such an implanted medical device, and it could only ever work for a limited set of assays, but I expect something like that will eventually be possible. We already see diabetics wearing continuous glucose monitors, which gives a preview of how such implanted sensors might operate.

What? Maybe investors think that they have the right to everything but it’s naive to think the bullshiting happens to customers and employees but magically stops at the people writing checks.

Hell, not much incentive to go the other way.

I've been in many due diligence calls for many different companies. Any VC that knows what they're doing will demand hard, objective answers to things that can't be "fuzzed":

1. What is trailing, or contracted, revenue? There is no gray area here. You're either lying or you're not, and lying is committing fraud (as Theranos appears to have done in this case). And no company I've previously worked at has lied about this in my experience.

2. What are the shipping capabilities of your product? Potentially some opportunity for "fluff" depending on how this is answered, but Theranos unambiguously lied here. Again, have never seen plain outright lying in a company I've worked at.

This idea that there is just a ton of lying going on with investors in SV is bullshit. The reason cases like Theranos are pretty extraordinary is they're quite rare.

The same people who proudly lie to employees and customers magically becomes honest when lying can get them a lot of needed money?

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