How to Blow $9 Billion in 6 Months
April 18, 2016 9:38 PM   Subscribe

In 2003, Elizabeth Holmes dropped out of Stanford University and formed Theranos (Wikipedia), a biomedical startup with the goal of transforming the blood testing industry. By mid-2014, the startup had raised over $400 million in venture funding and was partnering with Walgreens, making its young CEO a billionaire. And now, federal regulators have proposed revoking the federal license for Theranos' California laboratory and banning the firm's top two executives from the blood-testing business for at least two years (WSJ [paywalled], LA Times).

An article in the Wall Street Journal (paywalled) in October 2015 reported Theranos' technology struggles with its flagship technologies, and showed that Theranos had actually been running the tests on the machines of competitors. This report lent support to those questioning whether the technology actually worked, and noting a lack of peer-reviewed results (JAMA, paywalled).

Continuing Theranos' woes, in March of 2016 the Centers for Medicare and Medicaid Services (CMS) released a report following an inspection of the company's Newark CA lab that detailed faults at the lab so severe that they jeopardized patients’ health.
“The laboratory director failed to ensure that the appropriate personnel were responsible for the quality control and quality assessment program; failed to ensure that the freezer temperatures were appropriate for storage of specimens and reference materials; failed to ensure the methodologies selected provided quality results; failed to ensure the verification procedures were adequate,” CMS inspectors wrote in the report.
Regulators from CMS proposed banning Theranos' CEO Holmes and President Sunny Balwani from the medical diagnostics industry for two years.

In addition to CMS, Theranos has been investigated by or is under investigation from the SEC, the FDA, state health departments in Pennsylvania and California, and is now the subject of a criminal probe as to whether it misled investors and the federal government.

From ProPublica: How a Reporter Pierced the Hype Behind Theranos

From Inc.com: What Theranos and Elizabeth Holmes Have Always Misunderstood

And finally, for a little bit of schadenfreude, Theranos: How to Blow $9 Billion in 6 Months
posted by Existential Dread (129 comments total) 57 users marked this as a favorite
 
Where I could, I tried to offer alternatives to paywalled articles.
posted by Existential Dread at 9:39 PM on April 18, 2016 [13 favorites]


It's unbelievably idiotic in hindsight. Hundreds of thousands of people have devoted hundreds of billions of dollars to understanding biochemistry. It's not a field where a trickle of VC money will make a huge difference.

The particularly sad thing is that the tech community held up Holmes as an example of a wonderful new wave of strong female entrepreneurs, which may have prevented some of the alarm bells from going off.
posted by miyabo at 9:58 PM on April 18, 2016 [12 favorites]


“The laboratory director failed to ensure that the appropriate personnel were responsible for the quality control and quality assessment program; failed to ensure that the freezer temperatures were appropriate for storage of specimens and reference materials; failed to ensure the methodologies selected provided quality results; failed to ensure the verification procedures were adequate,” CMS inspectors wrote in the report.

I guess $9 billion wasn't enough to hire one competent lab manager.
posted by Mitrovarr at 10:01 PM on April 18, 2016 [19 favorites]


A friend of mine went to Theranos early in 2015 to repair a (outside manufacturer) scientific instrument for them. His appointment was delayed because they had to build a "massive tent city" over all the other instruments in the area through which he was to walk to get to the broken thing instrument. The secrecy was a bit weird at the time - also the inefficiency, why not just put a bag over his head? - but when the WSJ article came out later it became a bit clearer why they were so secretive. Because their technology was utter shit and the company was a mess.
posted by permiechickie at 10:02 PM on April 18, 2016 [43 favorites]


Threaten the widow of your former chief scientist with legal trouble after learning that she spoke to the Journal and said that her husband, who coauthored 23 patents during eight years with the company, repeatedly told her before he committed suicide that, “nothing was working.”

Wow. I've heard rumblings about the inaccuracy, SEC investigations, and how Walgreens was pulling out of the deal, but I hadn't heard anything about that suicide.
posted by CheeseDigestsAll at 10:07 PM on April 18, 2016 [22 favorites]


Also, I have to wonder if the tech is actually feasible. Diagnostic assays tend to have a certain minimum sample size because you have to have enough sample to contain enough copies of the target to overcome stochastic sampling error. Microfluidic assays can only utilize extremely small samples. You can see what the problem might be.
posted by Mitrovarr at 10:09 PM on April 18, 2016 [14 favorites]


It's interesting to me that almost the entire board of Theranos is associated with the right-wing Hoover Institution.

Granted, there is a Stanford connection through Holmes, but it still makes you wonder: is there something about American Conservatism that attracts the "BUY GOLD NOW BEFORE TRILATERALS AUDIT THE FED!!!" crowd?

Is there something about their politics that attracts them to obvious ponzi schemes?
posted by Tyrant King Porn Dragon at 10:10 PM on April 18, 2016 [35 favorites]


but she keeps the dough, right? so 'entrepreneur' ftw. if any VCs are listening, i'll totally wreck a company for a mere $100M.
posted by j_curiouser at 10:10 PM on April 18, 2016 [9 favorites]


This is a total WTF! I wonder what the deal was here. Was this an outright scam? Was it some wishful thinking weird science? It kind of reminds me of the perpetual motion/free energy type of endeavors that pop up every now and then. Sometimes they're pure scams, sometimes they're run by true believers, even bona fide engineers and scientists who just can't recognize their own bad science or acknowledge their own limitations.
posted by 2N2222 at 10:20 PM on April 18, 2016


One of the board members of Theranos is the same General Mattis being floated as conservative political savior.
posted by Ray Walston, Luck Dragon at 10:22 PM on April 18, 2016 [2 favorites]


but she keeps the dough, right? so 'entrepreneur' ftw. if any VCs are listening, i'll totally wreck a company for a mere $100M.


While she's most likely taken a few million dollars off the table, I assume most of her net worth is tied up in her share of Theranos, and is likely to be worth magnitudes less (if not completely worthless) than their value prior to today.
posted by gyc at 10:25 PM on April 18, 2016 [4 favorites]


Also, I have to wonder if the tech is actually feasible. Diagnostic assays tend to have a certain minimum sample size because you have to have enough sample to contain enough copies of the target to overcome stochastic sampling error. Microfluidic assays can only utilize extremely small samples. You can see what the problem might be.

I do microfluidic diagnostics. This shit stunk to high heaven to me from day one. My colleagues and I regularly send around each new revelation as it hits the internet, reveling in the schadenfreude. No one who knew the science (and especially the engineering) ever bought this crap.

While she's most likely taken a few million dollars off the table, I assume most of her net worth is tied up in her share of Theranos, and is likely to be worth magnitudes less (if not completely worthless) than their value prior to today.

And based on what's been hitting the press over the past few months, she's going to get sued into the ground. There's no way that this doesn't end without Elizabeth Holmes filing for bankruptcy.
posted by mr_roboto at 10:29 PM on April 18, 2016 [53 favorites]


It's now up to SV to make sure that something like this never ever happens again. At least for the next five years. Ok, guys?
posted by Foci for Analysis at 10:31 PM on April 18, 2016 [3 favorites]


I remember reading this and just thinking, no fucking way. Noting the profile's title, it's possible the writer had the same perspective.

Ah, the free gambol of VC across the plains. Is there nothing it thinks it can't solve? Is there nothing it won't sell, failure assured? Private prisons, private schools, cheap medical testing, the free time of homeowners and drivers? Water? Oxygen? Mercy? Hope?
posted by mwhybark at 10:45 PM on April 18, 2016 [23 favorites]


I worked in microfluidics research, which is the tech behind Theranos. I spent my time trying to streamline/mass-produce/perfect certain steps, and it was NOT easy. Long story short: I found a different field to work in. Also, the mass production/streamlining I worked on? It hit a wall and to my knowledge, still hasn't been figured out. (I initially assumed Theranos had succeeded, because Walgreens. Guess not!!)
posted by Xere at 10:52 PM on April 18, 2016 [5 favorites]


Granted, there is a Stanford connection through Holmes

Judging just by all the practiced circumlocutions in these articles' bios, Holmes's father seems likely to be a spook — so the connection to the defense/security state insiders on the board might, I'd guess, be familial as well, not just made through Stanford and Hoover. The question of how all those powerful insiders without STEM backgrounds ended up on that board is certainly an interesting one.
posted by RogerB at 10:55 PM on April 18, 2016 [23 favorites]


Here is just one example of a JAMA paper that is extremely valuable to the public interest but unavailable because of the paywalls. /Derail
posted by newdaddy at 10:55 PM on April 18, 2016 [8 favorites]


Hey what if there were a system where funds to do science were actually allocated by working scientists
posted by en forme de poire at 10:59 PM on April 18, 2016 [44 favorites]


I wonder if that VC firm might be interested in investing in my new underwater breathing apparatus?
posted by fshgrl at 11:02 PM on April 18, 2016 [4 favorites]


Holmes's father seems likely to be a spook

Really? I mean, he's certainly connected to Washington, but what makes you think he's anything other than a top person at USAID?
posted by mr_roboto at 11:02 PM on April 18, 2016 [1 favorite]


Yeah, the sheer infeasibility of it just keeps adding up the more I think about it. You know, all of those 'old-style' assays Theranos insults have been used and refined upon for ages. You're going to improve all of that and get away with less volume because "hand waving and microfluidics"? Look, lots of smart people have worked very hard on making all of those tests better, and any time you can cut down volumes you can make it cheaper. It's not easy! And you're going to do all of those complex tests on a single device? Especially considering many of them operate on different principles (chemical assays, immunoassays, and PCR, most likely)? I mean, it's not technically impossible, but it feels like going from zero to .9c in one step. Maybe demonstrate one good microfluidic assay first?
posted by Mitrovarr at 11:04 PM on April 18, 2016 [1 favorite]


I have, for sale to the right venture capitalist, a rock that will keep away tigers.
posted by nfalkner at 11:09 PM on April 18, 2016 [35 favorites]


nfalkner, I'd like to buy your rock.


After extensive long term studies to verify it works.
posted by Drinky Die at 11:12 PM on April 18, 2016 [4 favorites]


This is a very well put together and excellent fpp.
posted by stoneweaver at 11:17 PM on April 18, 2016 [27 favorites]


he's certainly connected to Washington, but what makes you think he's anything other than a top person at USAID?

A suspicion; call it baseless if you like. The company's story is, apparently, that George Shultz introduced Holmes to almost all the rest of the Theranos board after she "finagled" one meeting through the Hoover Institution to pitch the company to him.
posted by RogerB at 11:17 PM on April 18, 2016 [7 favorites]


It's nice to know that the people responsible are going to prison.
posted by adept256 at 11:25 PM on April 18, 2016 [6 favorites]


It's not unusual for a startup in this field to need extreme amounts of money. The reason is that healthcare field is extremely regulated. Which is the weird part. You just don't start offering medical services with proprietary technology. You may as well start diagnosing cancer with e-meters and dowsing rods. That they got this far is mind boggling. I can only think it was the magic of having well connected board of directors and a list of respectable medical advisers offering a veneer of legitimacy. They almost certainly were buttered up with some of that VC to sit there and look pretty. Which brings up the question, what did the directors and advisers actually know? Anything substantive at all? I can believe they were probably ignorant. But the medical advisers are going to take a well deserved credibility hit.
posted by 2N2222 at 11:34 PM on April 18, 2016 [11 favorites]


There's no such thing as an "open beta" to work out the bugs, because a bug in a new drug or medical device means people die. That's true in blood testing, too: Among the problems with Theranos's technology was a faulty test used to determine the proper dosage of blood thinners to give a patient. CMS said patients prescribed blood thinners based on their Theranos results were in "immediate jeopardy."
welp
posted by en forme de poire at 11:34 PM on April 18, 2016 [32 favorites]


It's nice to know that the people responsible are going to prison.

Don't be so glib. There's a lot of fallout down the road here. We'll see.
posted by mr_roboto at 11:35 PM on April 18, 2016 [2 favorites]


I doubt they can nail Adam Smith for this one. But we'll see!
posted by Potomac Avenue at 11:50 PM on April 18, 2016 [3 favorites]


Glad to see this here, it's an interesting story and it's a great post to start the discussion. I'm a former analytical chemist, worked in pharma my entire career, didn't really know anything about Theranos until the meltdown started. Been fascinated by what's like the archetype of a corporate collapse and weaselly denials. I spent some time on their website this weekend reading their nonsense posts, followed by some older articles that praised their response to the initial WSJ expose (one with the telling "assuming they are not totally lying about his" caveat.)

I'll say that while I'm indulging in schadenfreude the comments on industry places like In the Pipeline are so gleefully negative, more than at (say) even Valeant's collapse, which was a much more meaningfully harmful company. The same thing that made her a media darling--quite young, female, slick PR, secretive science, 'disruptive', coming from outside the industry--work against her image for many who've had a career on the mainstream pharma/med industry.

Hey what if there were a system where funds to do science were actually allocated by working scientists

Honestly? Most of us would fart around doing experiments with little chance of solving any problem--practical or academic--and just tell you that's how science worked if you complained. Scientists are human too and like to do what they're comfortable doing, and would certainly pay themselves to stay in a comfort zone given the opportunity.

Look, lots of smart people have worked very hard on making all of those tests better, and any time you can cut down volumes you can make it cheaper. It's not easy!

Definitely not easy but to give the model a bit of credit, you can get bizarrely archaic tests entrenched as standards because of an interplay of regulations and economic incentives. Whether this applies in blood testing I have no idea. It happens in forensics.

Also, I have to wonder if the tech is actually feasible. Diagnostic assays tend to have a certain minimum sample size because you have to have enough sample to contain enough copies of the target to overcome stochastic sampling error. Microfluidic assays can only utilize extremely small samples

To expand on this a bit, you'd have enough molecules in even a miniscule drop to give you accurate sampling for at least some tests. But in other cases the fact that it's from a finger prick--one microenvironment and that of a tissue you just damaged during sampling--would probably mess things up.
posted by mark k at 12:07 AM on April 19, 2016 [24 favorites]


"Here is just one example of a JAMA paper that is extremely valuable to the public interest but unavailable because of the paywalls. /Derail"
It is really interesting paper.

As always, if anyone would like a copy of this or any other peer reviewed paper relevant to this thread for this academic discussion that we are currently having, feel free to memail me with an email address I can send a PDF to and a promise not to distribute that PDF further.
posted by Blasdelb at 12:27 AM on April 19, 2016 [16 favorites]


Oh my god. I applied to be their in-house IP counsel last year and never heard back. lmao forever
posted by naju at 12:29 AM on April 19, 2016 [90 favorites]


“The minute you have a back-up plan, you’ve admitted you’re not going to succeed.” – Theranos CEO and founder Elizabeth Holmes

This kind of magical thinking seems to be popular in entrepreneurial circles. The only important thing is the Will of the visionary Founder and inner circle, and everything else must follow. It's a mentality capable of thinking that it's just a matter of a few details to make experimental tech into a commercial health care business.
posted by thelonius at 12:44 AM on April 19, 2016 [28 favorites]


Don't be so glib. There's a lot of fallout down the road here. We'll see.

No one's going to prison over this. Even if they were literally vampires judging blood samples like the pepsi challenge.

Only poor people go to prison.
posted by adept256 at 12:53 AM on April 19, 2016 [23 favorites]


Is there something about their politics that attracts them to obvious ponzi schemes?
An absence of doubt?
posted by fullerine at 12:54 AM on April 19, 2016 [10 favorites]


Despite the anti-intellectual posturing of the tech industry, there are indeed some enterprises where being a college dropout is a disadvantage, rather than proof of one's Randian ability to separate early from the herd. Who'd have thought?
posted by Sonny Jim at 1:11 AM on April 19, 2016 [20 favorites]


The goal was to get to the IPO. There's dumb money chasing ideas, good or bad, right now but there are also some very smart, very financially savvy venture capitalists out there. So when I see a business with obvious flaws I find it hard to believe than the funders didn't see the same flaws. They just didn't care about whether the actual business works as long as they could get the next suckers money. On the other hand 400 million seems like a lot to bet on other people's gullibility.
posted by rdr at 1:31 AM on April 19, 2016 [4 favorites]


You look at the composition of the board, which looks nothing like what you’d expect a VC-backed specialist medical R+D focused company to look like, and the strong suspicion has to be that this company was built to flip to the military before it got out that the technology didn’t work.

My guess is that the board purge in 2013 was when things finally hit the fan & management decided to double down on the 'make it look good & flip it to a dumb buyer with deep pockets' strategy. That’s the point where they brought in a whole bunch of big names in the miliary-industrial complex to replace the people with actual pharma / chemistry experience who either quit or were booted out. I wonder how much Theranos stock they gave Kissinger et al: Did they sell them on the dream too, or did they pay the new board members cold hard cash to put their names behind this turd of a company?
posted by pharm at 1:55 AM on April 19, 2016 [41 favorites]


It's nice to know that the people responsible are going to prison.

If Theranos is what actually locks up Kissinger, that will be like getting Capone for tax evasion. Times a million.
posted by Noisy Pink Bubbles at 2:45 AM on April 19, 2016 [19 favorites]


If you're going to pull this sort of stunt, try and do it in an area without too much regulatory oversight. I'd suggest power generation, storage, wireless or non-medical biotech. (I only suggest these because I've seen it happen here. Others are doubtless available.)Then, pick a territory with low-information investors, ideally cash-rich near-retirement/retired small business people or farmers; they've made a success of their lives so know it all and consider themselves savvy in everytihng. I'd suggest Florida or Ireland.

Come up with a product that meshes with the popularly perceived technical zeitgeist, apparently makes some sort of major leap forward, that can be 'demonstrated' with a single, uncheckable and easily-faked example, and construct some backstory that hinges on gee-whiz Science (using the words 'quantum', 'nanotech', 'field' etc) and an Heroic Inventor/Chance Discovery.

Hook your marks. Feed heir greed, sense of superiority over the clod-disbelievers, push the 'so revolutionary, nobody can admit it to their worldview/is so threatened by it they'll say anything' line once anyone who knows your field cottons on and starts fo express doubts. Drop a few promises of world-changing tech built by underdogs to the press - they'll lap it up and won't ask questions.

NDA everything up the wazoo, and exhibit total paranoia about your valuable IP.

Keep that cadence going with demonstrations, promises, demands for more cash, for as long as you can. You might get to IPO, you might get some ex-military/end-of-career academics along for the ride, you might even do some deals with real companies or organisations along the way. But time those well - don't give them room to go bad before you've used them for the IPO or other cash-out.

Never, never, never allow a hint of cynicism out to the real world: you ARE true believers in your unique vision and wondrous discovery, and it is absolutely NOT any sort of investor-harvesting scam. Never admit, never confess, never engage. Got that? Good.

Play this right and you can enjoy decades of well-funded fun. You might even spin off something actually useful along the way, but do try and avoid that. You will be indistinguishable from many genuine start-ups to the outside world (who, let's be honest, haven't got that much greater chance of success than you do), and playing your cards carefully will protect you from the press, the law and your marks for a surprisingly long time.

These people broke too many of those rules. Which is a shame for them, because the game is popular, profitable and pretty bombproof if you're smart and have enough chuzpah. It even has its own incubators now, in Kickstarter and the like.

So, yeah. Idiots. But I predict this: their public collapse and spectacular incineration will not change that game one iota - there are undoubtedly another ten Theranoses already bubbling away.
posted by Devonian at 3:07 AM on April 19, 2016 [70 favorites]


Oh my god. I applied to be their in-house IP counsel last year and never heard back. lmao forever

Sound like you dodged a bullet. Like one of those big super mario bullets.
posted by Ray Walston, Luck Dragon at 3:24 AM on April 19, 2016 [49 favorites]


Here is just one example of a JAMA paper that is extremely valuable to the public interest but unavailable because of the paywalls. /Derail

Sci-Hub thinks so too, and will take you around the paywall.

Elsevier is, of course, suing to remedy that.
posted by ryanshepard at 3:54 AM on April 19, 2016 [9 favorites]


Time to go to work and see what I can find from my office re: Johns Hopkins and Theranos! This will be so much more fun than my normal work.
posted by josher71 at 4:25 AM on April 19, 2016 [2 favorites]


Interesting choice of name. Apparently a combination of "therapy" and "diagnosis" but ends up sounding a lot like this.
posted by tinkletown at 4:41 AM on April 19, 2016 [21 favorites]


Still, he balked at seeing her start a company before finishing her degree. “I said, ‘Why do you want to do this?’ And she said, ‘Because systems like this could completely revolutionize how effective health care is delivered. And this is what I want to do. I don’t want to make an incremental change in some technology in my life. I want to create a whole new technology, and one that is aimed at helping humanity at all levels regardless of geography or ethnicity or age or gender.’ ”

That clinched it for him. “When I finally connected with what Elizabeth fundamentally is,” he says, “I realized that I could have just as well been looking into the eyes of a Steve Jobs or a Bill Gates.”


Oooooohhh that's gotta hurt. But hey, Big Money makes the world go 'round. Big Money give and take.
posted by petebest at 4:55 AM on April 19, 2016 [4 favorites]


Early Apple's business was building computers and software. Microsoft's business was delivering operating systems and office software. That would be engineering, building stuff and selling it to costumers. By the time Bill Gates and Steve Jobs became rich thousands and eventually millions of copies of their products were in the hands of consumers. They weren't in the business of revolutionizing anything, especially basic science.

Also, how the hell did she hold on to 50% of her company's stock?
posted by rdr at 5:08 AM on April 19, 2016 [10 favorites]


I remember reading this and just thinking, no fucking way. Noting the profile's title, it's possible the writer had the same perspective.

I remember reading that New Yorker article and disliking how lauditory of her it was, though it raised appropriate questions (in retrospect) about the technology. One sentence, though, reads very differently now that the scam has come out:
Board members are clearly charmed by Holmes.
The board's role in this is going to be interesting to unpick -- were they duped or were they a part of the scam? I wonder what kind of liability the individual members are potentially facing when the lawsuits start.
posted by Dip Flash at 5:16 AM on April 19, 2016 [5 favorites]


"A chemistry is performed so that a chemical reaction occurs and generates a signal from the chemical interaction with the sample, which is translated into a result, which is then reviewed by certified laboratory personnel." She added that, thanks to "miniaturization and automation, we are able to handle these tiny samples."
Reading this quote (from the New Yorker article, via Business Insider), I'm wondering not only how qualified she was to run the kind of business she purported to be running, but also how she got into Stanford in the first place.
posted by Sonny Jim at 5:54 AM on April 19, 2016 [12 favorites]


Remaining from the original board were Theranos President and COO Ramesh "Sunny" Balwani and former Secretary of State George Shultz; added to the new board were
Riley P. Bechtel (chairman of the board at Bechtel Group),
Richard Kovacevich (former Wells Fargo Chairman and CEO),
Sam Nunn and Bill Frist (former U.S. Senators),
Henry Kissinger (former Secretary of State),
William Perry (former Secretary of Defense),
William Foege (epidemiologist, former director U.S. CDC),
James Mattis (General, USMC, retired) and
Gary Roughead (Admiral, USN, retired)
Several of whom are members of Stanford's Hoover Institution, with medical doctors Frist and Foege, and lawyer/executive Bechtel being added most recently (in 2014).


No Condi Rice?!? SAD.
posted by petebest at 5:54 AM on April 19, 2016 [11 favorites]


Hey what if there were a system where funds to do science were actually allocated by working scientists

That's how NSF works?
posted by ROU_Xenophobe at 6:02 AM on April 19, 2016 [4 favorites]


tinkletown: Interesting choice of name. Apparently a combination of "therapy" and "diagnosis" but ends up sounding a lot like this.

The name always sounded vaguely sinister to me. Now I know why. Thanks!
posted by clawsoon at 6:05 AM on April 19, 2016 [4 favorites]


"A chemistry is performed so that a chemical reaction occurs and generates a signal from the chemical interaction with the sample, which is translated into a result, which is then reviewed by certified laboratory personnel."

Aha hahaha! "I take big numbers, transmute them, and calculate their load-bearing tangents."
posted by glasseyes at 6:13 AM on April 19, 2016 [9 favorites]


I shall miss Theranos, if only because when it goes down the phrase, "Theranos, the blood unicorn" shall disappear from the business pages.

The whole thing has pleasing overtones of a fairy tale which can't but charm in these days when art is so denigrated. It was such a good story: The young princess, clever and bold, blond and beatiful, leaves her father's castleStanford to go forth and bravely fight the dragonthe FDA, armed only with a technological breakthrough a handful of magic beans. And that was worth $9 billion! Truly the power of narrative --- nitro'd up with a little FOMO ---- knows no bounds.
posted by Diablevert at 6:15 AM on April 19, 2016 [17 favorites]


That's how NSF works?

I took that comment as sarcasm.

But geez, yeah, the NSF, the NIH, other government entities - among the ten billion things that piss me off about this whole thing is that we can find all this garbage venture capital to give to garbage people to make returns for other garbage people and yet it's incredibly hard to fund actual non-profit science that benefits everyone.

(My own feeling about this particular company is that part of the excitement lay in the fact that it would make it easier for employers to press for health info from employees, make it easier to compile health data on prisoners, etc. In theory we have HIPPAA, but in actuality, having a massively diagnostic pinprick-test would create a lot of real-world pressure for people to waive their privacy rights.)
posted by Frowner at 6:22 AM on April 19, 2016 [5 favorites]


I really want General Mattis to enter the presidential race now as last minute savior candidate, if only so that some enterprising opponent can ask him if his role in this was as a crook or as just an idiot.
posted by Blasdelb at 6:32 AM on April 19, 2016 [5 favorites]


having a massively diagnostic pinprick-test would create a lot of real-world pressure for people to waive their privacy rights.

Yes. Devonian has a pretty sexy template up there but he seems to have missed this crucial point. The spooks are investing billions in privacy invasion and surveillance and that giant pool of money might be the single juiciest target.
posted by bukvich at 6:32 AM on April 19, 2016 [3 favorites]


This is an interesting bit from the JAMA article:
As an illustration, for laboratory testing, most of the diagnostic cost in the United States is attributable to overhead and indirect personnel costs rather than the cost of the technology, and the amount of money charged can be vastly greater than the direct cost.
There are a handful of interesting conclusions to be taken from that about the Theranos business model.
posted by clawsoon at 6:35 AM on April 19, 2016 [6 favorites]


Fshgrl - haha good shout! For those who have not seen Triton - an unbelievably funded and highly dubious crowd funded underwater breathing appartatus.
posted by numberstation at 6:40 AM on April 19, 2016 [3 favorites]


I had a college friend looking into a position with this company.

After speaking with them, his response was "I'm either going to be the smartest guy or the dumbest guy in the lab and neither one of those roles is desirable. [Pause] Also, I can't be that dumb."
posted by TofuGolem at 6:41 AM on April 19, 2016 [17 favorites]


Here is just one example of a JAMA paper that is extremely valuable to the public interest but unavailable because of the paywalls. /Derail

Is it worth $30? That's how much it costs to access the article, which probably cost between $2500-$4000 to produce, including webhosting (by the publisher, not the authors).

I don't think this is a derail, actually-- this company blew through $9 billion dollars based on a series of lies and with zero result, and many potential damages-- but paying people who distribute actual scientific results is unfair?

I mean, I get it, I work around paywalls sometimes too. But given how many people on MF advocate the "fuck you, pay me" approach for content creators when the content is artistic, I think it is odd that the same principle doesn't apply to research.
posted by a fiendish thingy at 6:49 AM on April 19, 2016 [5 favorites]


As an illustration, for laboratory testing, most of the diagnostic cost in the United States is attributable to overhead and indirect personnel costs

And of course there is now an Uber for Phlebotomists.
posted by peeedro at 6:52 AM on April 19, 2016 [2 favorites]


I've got a wild, crazy idea that might really be disruptive to a number of industries.

How about not throwing insane amounts of money at narcissistic sociopaths who make grandiose claims with nothing to back them up but their own charm and arrogance?
posted by tdismukes at 6:55 AM on April 19, 2016 [2 favorites]


"fuck you, pay me"

i think the analogy is less creative:scientist and more record label:publisher
posted by j_curiouser at 6:55 AM on April 19, 2016 [9 favorites]


Existential Dread: "And finally, for a little bit of schadenfreude, Theranos: How to Blow $9 Billion in 6 Months"

This is basically the bigger version of K Foundation Burn a Million Quid.
posted by Chrysostom at 6:56 AM on April 19, 2016


I find it refreshing that a woman has been successful at the exact same bilking game that men have created over hundreds of years. She played it the same way and there you have it. Bravo.
posted by amanda at 7:03 AM on April 19, 2016 [4 favorites]


I mean, I get it, I work around paywalls sometimes too. But given how many people on MF advocate the "fuck you, pay me" approach for content creators when the content is artistic, I think it is odd that the same principle doesn't apply to research.

The same principle doesn't apply to research by default, where the content creators (scientists) NEVER get paid for their published work and often have to pay processing charges to get a paper published.

(on preview, j_curiouser got to it before me)
posted by zingiberene at 7:13 AM on April 19, 2016 [8 favorites]


mr_roboto: "I do microfluidic diagnostics. This shit stunk to high heaven to me from day one."

And this is the equivalent of the Marshall McLuhan scene in Annie Hall.
posted by Chrysostom at 7:13 AM on April 19, 2016


"Is it worth $30? That's how much it costs to access the article, which probably cost between $2500-$4000 to produce, including webhosting (by the publisher, not the authors).
...
But given how many people on MF advocate the "fuck you, pay me" approach for content creators when the content is artistic, I think it is odd that the same principle doesn't apply to research.
"

Well, I wouldn't mind paying for article access if the money went to the scientists who did the research and wrote the article, but it doesn't. I wouldn't mind if some of the money went to the peer-reviewers who put time into checking and offering feedback on the article, but it doesn't. I wouldn't even mind paying a reasonable fee to cover web-hosting expenses, but $30 per article is not that.

Just curious, where do you get the $2500-4000 figure? Is that the cost to the journal of processing each article that is provided to them free of charge by the researchers and peer-reviewed free of charge? How does that total break down? I'd feel better about paying for article access if the journal could say "x is our expenses to process an article, y are our fixed costs, z is the average number of requests for access per article, we charge ((y + x*numArticles)/(z*numarticles) + reasonableProfit%) for access.
posted by tdismukes at 7:13 AM on April 19, 2016 [15 favorites]


I shall miss Theranos, if only because when it goes down the phrase, "Theranos, the blood unicorn" shall disappear from the business pages.

I think I saw Blood Unicorn opening up for Frenulum
posted by thelonius at 7:16 AM on April 19, 2016 [8 favorites]


Is there something about their politics that attracts them to obvious ponzi schemes?

No, of course not, don't be silly.
posted by IndigoJones at 7:19 AM on April 19, 2016 [3 favorites]


I am totally bummed that when I image search for Theranos the blood unicorn I have to scroll way, way down to find my first impalement. And there is very little in the way of blood unicorns at all.
posted by wotsac at 7:26 AM on April 19, 2016 [4 favorites]


Theranos the blood unicorn

'VC-funded startup or Magic the Gathering card? Take our quiz and find out!'
posted by cjelli at 7:28 AM on April 19, 2016 [11 favorites]


Serious question: is any of this ever going to blow back on Stanford? When I hear that someone went to Stanford, I immediately think "this person is probably a narcissist sucking on VC money while giving TED talks about 'changing the world', but never actually shipping anything". It's a good school, and of course there are students who don't fit this pattern, but at some point, shouldn't we start questioning the university producing all these assholes?
posted by kevinbelt at 7:36 AM on April 19, 2016 [18 favorites]




Oh, god. I spend much of my work time talking with and about students who are getting ready to go on leave and take on the world with their Life! Changing! Invention. Some of them end up doing it, some don't, and my interest isn't really in pushing them either way, but in making sure they have a good understanding of what it would mean for their educations, of how likely it is that they're *actually* the next Steve Jobs, and that they're not being pushed into making the move by someone with a vested interested in making money off the student's invention.

I have a few nightmare scenarios about the ones who do leave and never come back to finish their degrees, but I'm now adding "company makes it big-time, then blows up SPECTACULARLY and drives everyone involved into bankruptcy" to my nightmare scenario list. I'll be hiding under the bed fretting about every student who's ever decided to go on leave, if anyone needs me.
posted by Stacey at 7:44 AM on April 19, 2016 [5 favorites]


Just curious, where do you get the $2500-4000 figure?

I work in nonprofit scientific publishing, and those figures are lowballing, but pretty normal. It takes a LOT of time and money to make an “accepted” article ready for publication.

Not everyone works for Elsevier, but we all get a lot of nasty letters/emails/tweets from people who want knowledge to be freeeeeeeee, but also no plagiarism (software catches some, but humans catch the rest, also the software costs money), usable (and correctly numbered) reference lists, online access (in perpetuity), professional layout/design, ADA accessibility options for the website/articles, searchable databases, research promotion, social media management, tracking down/paying for image permissions on behalf of authors, vetted peer reviewers, high impact factor, shorter turnaround times from acceptance to publication, SEO, discipline-compliant copyediting, tech support for everyone who has trouble remembering passwords or uploading files, onsite support for coordination w/University communications personnel, press releases, releasing advance copies for media contacts to cover the research once it publishes, catching and dealing with embargo breaks, multiple rounds of page proof review/corrections with authors, explaining that 72 dpi and 300 dpi are not the same in a 14-email exchange that takes two weeks, providing access/download information for specific articles for authors who have upcoming tenure reviews. . .

It isn't getting a file and uploading a file. I WISH.
posted by a fiendish thingy at 7:45 AM on April 19, 2016 [14 favorites]


At least around here, there's publication fees in the thousands of dollars as things sit. (Not requested up front - after the paper has been accepted. And I stress that these are reputable journals with long histories.) One writes publication charges into the grant. Now, I personally think this is sorta reasonable - research is supported by the state, the state pays for publication, everyone gets the results. At this point, I think a lot of NIH-funded publications have to be publicly accessible, right?
posted by Frowner at 7:53 AM on April 19, 2016


Yes, but NIH (and most govt funding agencies) grants the publishers a 12 month embargo before they make it Open Access, as a chance to recoup the costs of publication.

Most journals only charge optional fees (ex: color figures in print articles), although I know some are moving away from that model. But yes, most funding for those fees comes directly from the grants that supported the research.
posted by a fiendish thingy at 8:00 AM on April 19, 2016 [1 favorite]


At this point, this is a huge derail and maybe it's run its course. Please say it has...
posted by stoneweaver at 8:04 AM on April 19, 2016 [4 favorites]


At this point, this is a huge derail and maybe it's run its course. Please say it has...

You mean this isn't fascinating to you? I can't understand people sometimes.

posted by Frowner at 8:07 AM on April 19, 2016


Please say it has...

Yep, sorry. My point wasn't "let's talk about academic publishing", really. My point was-- this group managed to circumvent (sorry, DISRUPT) all of the gatekeeping/oversight systems that already exist within science and medicine because of their VC funding and visionary rhetoric, but the result wasn't a breakthrough. It was just more snake oil.

All the disruptors want us to believe that "disrupting" is brave and will save the world, but they just keep recreating more broken versions of the old world. That was my original point.
posted by a fiendish thingy at 8:10 AM on April 19, 2016 [5 favorites]


I wish I could feel schadenfreude on the Theranos story but I just can't. Back before the scandal broke I was rooting for the company. Brash young founder, a female founder, with a magic tech that was going to revolutionize part of health care? I want that to succeed. Also I don't have any personal connection but we both went to the same high school, which makes me feel some affinity. Theranos isn't some bro-scam company making shitty pay-to-win mobile games or something, it was trying to accomplish a real breakthrough in medical testing. I hate seeing it crumble.

My impression from all I've read is it wasn't a scam from the beginning. There's something promising in the core tech innovation. But it doesn't work quite as well in practice as it needs to, a common problem in medical technology. And when the discouraging test results came in instead of improving the tech or admitting defeat they just started pretending it would work anyway. What a waste.
posted by Nelson at 8:32 AM on April 19, 2016 [5 favorites]


And when the discouraging test results came in instead of improving the tech or admitting defeat they just started pretending it would work anyway.

Also they thought they could just blithely ignore FDA regulations and get right down to treating patients, which put those lives at risk. I don't have much sympathy for these guys, personally. I can think of a million ways in which this could have gone better from the start, and all of those start with "bring on experts in medical device development and regulatory approval," rather than disrupt disrupt disrupt and finally vilify your critics when your bullshit gets exposed.

I should have been a bit clearer on the $9bn figure; that was the expected company valuation upon IPO prior to the WSJ article exposing their faults. They didn't actually blow $9bn.
posted by Existential Dread at 8:46 AM on April 19, 2016 [10 favorites]


If you want to listen to some Theranos talk, it was the second segment on this Slate Money episode from October of last year.
posted by mmascolino at 8:47 AM on April 19, 2016 [2 favorites]


When people say they are going to "change the world" with something they've created, I am immediately aware that they are narcissists. Changing the world is not something that one person does, unless they are a serious fucking genius. There are very few serious fucking geniuses out there, and to say that you think you're one of them is the very definition of egomania.

I went to a big meeting held at one of the federal granting agencies recently, an annual progress meeting for one of the grants they give. "The next Einstein is here, in this room!" shouted the woman at the front of the podium during the welcome address. "You people are going to change the world!" Applause. Everyone loved it. No! Fuck that. Seriously, fuck that! The next Einstein was not in that room. We were all just scientists trying to do our work, and trying to get the money we need to do it: that's who was in the room. And Einstein wasn't even able to get into the academy at first. Jesus. Know your history, and stop pushing snake oil science, god damn.
posted by sockermom at 9:47 AM on April 19, 2016 [22 favorites]


>> which probably cost between $2500-$4000 to produce

In my field, journal articles have fees (sometimes lump, sometimes per page, sometimes for color figures, sometimes for open access) that can range from $600-$3000 per publication, paid for by the author.

On top of that, journals are purchased by libraries, often at the cost of $2-3000/yr per title, up to over $20000/yr. And furthermore, these journals sometimes can't be purchased separately and are only available like cable television channels- as part of multi-journal subscription packages.

The measure of the lack of value here is the insanely high margins of academic publishers, as well as little ability to do anything about it due to concentration in the hands of just a few companies.

From wikipedia: "Elsevier annually publishes approximately 350,000 articles in 2,000 journals." and "In 2014, Elsevier reported a profit margin of approximately 37% on revenues of £2.048 billion".
posted by Maxwell_Smart at 10:00 AM on April 19, 2016 [9 favorites]


When people say they are going to "change the world" with something they've created, I am immediately aware that they are narcissists.

Or they just think that that's how they are supposed to talk, in order to be taken seriously by whoever they want money from. So, you forgot charlatans.....
posted by thelonius at 10:01 AM on April 19, 2016 [1 favorite]


Does Stanford offer courses on hubris, or is that something they screen for in the application process?
posted by slogger at 10:35 AM on April 19, 2016 [3 favorites]


Does Stanford offer courses on hubris, or is that something they screen for in the application process?

On the one hand, considering she dropped out at 19, I'd be surprised if she got past gen ed requirements or whatever else Stanford has first years do.

On the other hand, if they did have a course on hubris, anyone who signed up for it as a first year student should immediately receive a certificate from the registrar's office that just says, "You Pass!"
posted by Copronymus at 10:58 AM on April 19, 2016 [4 favorites]


I find it refreshing that a woman has been successful at the exact same bilking game that men have created over hundreds of years. She played it the same way and there you have it. Bravo.

Maybe a woman could start the next world war. I mean, if your aspiration is to have women be equally shitty to the worst males, why aim low? Bilking people is for chumps!
posted by five fresh fish at 11:09 AM on April 19, 2016 [5 favorites]


MetaFilter: The Blood Unicorn
posted by vibrotronica at 11:16 AM on April 19, 2016


This is not just about Theranos.

I advise a microfluidics diagnostic company that really does have an amazing technology that can make a huge difference in a major disease and save tens of thousands of lives. They are doing things right: headed by PhDs with a board made up of pathologists. They are also publishing peer-reviewed papers so everyone knows how the technology works and how effective it is.

But now the Theranos debacle has utterly decimated VC interest in the field, and they are running away from diagnostics leaving many companies struggling for funding. This is a big deal because most diagnostics startups required at least $20M, and sometimes many times more, in order to get a technology built and approved. It takes years of investment to get to market. Theranos is discrediting an entire industry that develops important, life saving tools. VC can be easy to laugh at, but it also plays a key role in innovation.

Not that the trainwreck isn't interesting, but there are consequences.
posted by blahblahblah at 11:23 AM on April 19, 2016 [55 favorites]


From wikipedia: "Elsevier annually publishes approximately 350,000 articles in 2,000 journals." and "In 2014, Elsevier reported a profit margin of approximately 37% on revenues of £2.048 billion".

Tragi-farcedy of the enclosed commons.
posted by jamjam at 11:25 AM on April 19, 2016 [2 favorites]


Board members are clearly charmed by Holmes.

By all reports, Holmes is extremely charismatic in person, one-on-one, in a way that isn't immediately accessible to us if he watch her being interviewed or giving a talk. I am sure she is able to create a steve-jobsian "Reality Distortion Field" when she's making her pitch.

But this also should point out what should have been an obvious truth: there are no "biology prodigies." Sure, there are math prodigies and physics prodigies who do their best work at a young age and come up with amazing breakthroughs early, but this doesn't happen in biotech, because the field requires people to have an enormous amount of knowledge and experience, particularly knowing everything that has been tried and why it didn't work before. By all accounts, the company was (purposefully) out of the academic loop, and Holmes herself didn't seem to have much regard for scouring academic literature and finding collaborators.

As far as "Changing the World." Yeah, I've heard it-- I first heard it for a software consulting company I worked for. I was writing Visual Basic code to sell insurance over the Internet. To our credit, we could finish such projects somewhat faster and more reliably than our competitors at the time. What I didn't like was showing up to work being told we were doing something other than what we were actually doing.
posted by deanc at 11:29 AM on April 19, 2016 [7 favorites]


“The minute you have a back-up plan, you’ve admitted you’re not going to succeed.” – Theranos CEO and founder Elizabeth Holmes

Ah, back-up plans.
posted by maryr at 12:09 PM on April 19, 2016


"My impression from all I've read is it wasn't a scam from the beginning. There's something promising in the core tech innovation. But it doesn't work quite as well in practice as it needs to, a common problem in medical technology. And when the discouraging test results came in instead of improving the tech or admitting defeat they just started pretending it would work anyway. What a waste."
It is increasingly clear that what was original or unique about the bullshit that Theranos has been hiding this whole time is of little to no value, and that the aspects of the applications of microfluidics to diagnostics which are genuinely promising are neither original nor unique to Theranos. Its just hubris, fraud, and and a willingness to hurt people all the way down.
posted by Blasdelb at 12:11 PM on April 19, 2016 [7 favorites]


That's how NSF works?

I mean, yeah, the government sets top-down funding priorities, but volunteer working scientists are at least the ones who rank-order research proposals. (I'm more familiar with the NIH system than the NSF system, though.)

Honestly? Most of us would fart around doing experiments with little chance of solving any problem--practical or academic--and just tell you that's how science worked if you complained. Scientists are human too and like to do what they're comfortable doing, and would certainly pay themselves to stay in a comfort zone given the opportunity.

Well first of all I think that's false within biomedicine, which is already incredibly competitive (to the point where that environment has its own perverse incentives), and where it is so difficult to predict a priori where the most valuable advances will come from. But even if this were completely true, I would still take the expected return on 750 professional biomedical scientists being paid $1M each to stay within their own personal comfort zones, over raising the same amount for a company run by an undergrad-drop-out whose total relevant experience appears to have been a semester-long class on drug delivery.
posted by en forme de poire at 12:20 PM on April 19, 2016 [4 favorites]


“The minute you have a back-up plan, you’ve admitted you’re not going to succeed.”

That is like the platonic ideal of hubris.
posted by Mitrovarr at 12:23 PM on April 19, 2016 [13 favorites]



“I had not had much formal biology training,” Holmes recalls, so she had to bring herself up to speed in that respect on her own. At the same time, her engineering and technology background at Stanford led her to believe that “there were much better ways to do” the tests she saw being performed at the institute.

...
[Holmes] admits–laughing nervously at the eccentricity of it–that after a meal she sometimes examines a drop of her own or others’ blood on a slide, and says she can observe the difference between when someone has eaten something healthy, like broccoli, and when he’s splurged on a cheeseburger.

I don't know you guys, she seems legit.
posted by randomnity at 1:09 PM on April 19, 2016 [29 favorites]


At the same time, her engineering and technology background at Stanford

She does seem legit. I mean she spent literally months getting an engineering and technology background before dropping out of Standford. Months!
posted by OmieWise at 1:32 PM on April 19, 2016 [8 favorites]


Ah, the free gambol of VC across the plains. Is there nothing it thinks it can't solve? Is there nothing it won't sell, failure assured? Private prisons, private schools, cheap medical testing, the free time of homeowners and drivers? Water? Oxygen? Mercy? Hope?

I don't think the giant pile of money really cares, in the end, whether its ventures solve real problems. Investors are just flailing around looking for something that might keep up a return > 10% on average when everything else is paying less than 3%. This heedless, herd-minded lending spree will keep distorting the economy in scary ways so long as the giant pile of money exists.
posted by Popular Ethics at 1:44 PM on April 19, 2016 [4 favorites]


The 483s (site inspection observations) for Palo Alto and Newark are available, though heavily redacted. Summary: in Palo Alto the FDA found design, validation, and documentation deficiencies, while in Newark they found a lot of documentation and reporting was not going on as required.

This company was on my job radar, though I didn't apply. They certainly had a lot of quality/regulatory job openings. Sounds like it would have been an awful job; nobody likes being told that they're doing everything wrong and that their stuff doesn't work like it should.

This is a good reminder that I need to look carefully into companies before/when applying to work there.
posted by mountmccabe at 2:12 PM on April 19, 2016 [1 favorite]


I guess this is funny. I was really hoping for something that would let people with chronic diseases, like my diabetes, to get more frequent, affordable measurements. Quest is definitely never going to come through on that, certainly. Now they're probably more entrenched than ever.

Also, rolling my eyes a bit at all these blood test professionals suddenly right all along.
posted by michaelh at 2:28 PM on April 19, 2016 [1 favorite]


I don't think the giant pile of money really cares, in the end, whether its ventures solve real problems.

My personal theory is a little bit different. Some of the last few mega-billion-dollar IPOs have been for ideas that are so incredibly zany, so incredibly stupid-sounding, that I think investors have simply given up on judging companies by their merits. Sure, they'll look at growth curves, at media buzz, at the bios of the founders. But a stupid little chat app made billions, a photo sharing app intentionally limited to terrible quality pictures made billions, and Elon Musk is starting a rocket company and a car company at the same time. If you're a 58-year-old VC with a Harvard MBA managing a couple billion bucks of client money, you've probably decided that the world just makes no sense anymore and you might as well throw money at anything and see if it sticks.
posted by miyabo at 8:50 PM on April 19, 2016 [5 favorites]


Its like the Star Citizen of biomedical devices!

Compulsively proclaim “unparalleled transparency” while being completely opaque. Use impressive numbers with lots of zeros when talking about how many tests you’ve run, patients you’ve served, and pages of data you’ve submitted to the media while providing zero evidence of the accuracy of your tests.
posted by Iax at 8:55 PM on April 19, 2016


I don't think the giant pile of money really cares, in the end, whether its ventures solve real problems. Investors are just flailing around looking for something that might keep up a return > 10% on average when everything else is paying less than 3%. This heedless, herd-minded lending spree will keep distorting the economy in scary ways so long as the giant pile of money exists.

Pardon me while I blink in astonishment a few more times, Popular Ethics, but you seem to have come up with a not easily refuted argument that Holmes' actions have resulted in a net benefit for society, because if there were only a few (hundred) more like her, the giant pile of money might soon cease to exist, and the hyperinflationary pressure on the price of every good and service suitable for rent-seeking investment could actually slack off for a bit.
posted by jamjam at 9:11 PM on April 19, 2016 [4 favorites]


The suicide of Ian Gibbons is sad part of this. Holmes hired Ian Gibbons in 2005 and his name is on 23 of their patents. He killed himself in 2013. His widow says that he “told me nothing was working”. Unbelievably, Theranos then threatened to sue her for saying that. Some psychotic lack of empathy there.

There is much more to the patent story. A quick search and I found someone accusing him of fraud two months before his death. A patent he filed for Theranos was very similar to a patent he filed for a previous employer, Biotack, in 1988.
posted by bhnyc at 10:26 PM on April 19, 2016 [7 favorites]


Well first of all I think that's false within biomedicine, [ . . . ] I would still take the expected return on 750 professional biomedical scientists being paid $1M each to stay within their own personal comfort zones, over raising the same amount for a company run by an undergrad-drop-out whose total relevant experience appears to have been a semester-long class on drug delivery.

Well, sure, I'd take "the field" of trained scientists against one of the most mind-bogglingly extreme examples of incompetence in the last decade too.

The non-snide kernel of my previous comment was the idea what you do not want to do is insulate decisions on what science gets done from the rest of society. A hypothetical scientific establishment that controlled their own budget sizes and distribution, with no input from politics or the market to keep them honest would be more dignified than the current mess but I doubt it could possibly be better. The driven scientists you talk about in biomedicine, for example, are trying to win some very high stakes games with lots of cash incentives, even in academia--that CRISPR patent fight isn't about who gets to be the next department chair.
posted by mark k at 11:32 PM on April 19, 2016


No one wants to be the next department chair.
posted by maryr at 1:01 PM on April 20, 2016 [1 favorite]


PS: The "driven scientists in biomedicine" fighting over CRISPR are actually Berkeley and MIT.
posted by maryr at 1:03 PM on April 20, 2016 [1 favorite]


PS: The "driven scientists in biomedicine" fighting over CRISPR are actually Berkeley and MIT.

Are you saying Jennifer Doudna doesn't have an opinion on this? The private company she helped found is indifferent to the IP status?
posted by mark k at 6:11 PM on April 20, 2016


My comment wasn't referring to a hypothetical scientific institution, it was a sarcastic reference to the actual way that NIH grants are prioritized for funding. For those who aren't familiar, while government of course sets general priorities and the overall size of the budget, panels of volunteer working scientists are largely responsible for rank-ordering proposals for scientific merit (along with administrators, who themselves are scientifically trained). Anyway, the NIH system is hardly perfect, but it certainly at least involves outside scientific oversight.
posted by en forme de poire at 8:18 PM on April 20, 2016 [2 favorites]


I'm saying the actual legal parties involved in the proceedings are MIT/Broad and Berkeley/the UC system.
posted by maryr at 8:30 PM on April 20, 2016 [2 favorites]


Doudna and Zhang both care a lot though, don't get me wrong.
posted by maryr at 8:31 PM on April 20, 2016 [1 favorite]


At some point, shouldn't we start questioning the university producing all these assholes?

It's not blatant affinity fraud, but there's clearly a degree to which certain resume items or even a particular look (Zuckerberg hoodie, Jobs black turtleneck) become a reason to throw money and lend credence to ventures where there's a homeopathic amount of there there.

Perhaps someone should come up with a test to gauge one's susceptibility to such things?
posted by holgate at 9:34 PM on April 20, 2016


I wonder if you can take one class at Stanford, then drop out, thus being the famous prototypical Stanford drop out who is eligible for millions in seed money. Whatever you do, don't finish a degree though!
posted by miyabo at 5:56 AM on April 21, 2016 [2 favorites]


Here you go, Miyabo. Free, too!
posted by tinkletown at 1:13 PM on April 21, 2016


No one wants to be the next department chair.

Seriously. Department chair is like getting the door with the goat behind it in Let's Make a Deal.
posted by mr_roboto at 5:30 PM on April 22, 2016 [1 favorite]


It's great if you really like butting heads?
posted by maryr at 8:13 PM on April 22, 2016 [3 favorites]


Don’t Blame Silicon Valley for Theranos

I don't know how accurate the article is but it asserts that the smart VC money wan't fooled by Theranos.
posted by rdr at 9:21 AM on April 28, 2016


Which venture capitalists invested in Theranos? Crunchbase has some oddly incomplete information. There's the well-known seed investment from Draper Fisher Jurvetson. The Series B is by is ATA Ventures; they were in the Series C too. No info on the Series A though, nor the 2010 anonymous venture round. The big investments came from private equity firms in 2014 and 2015.
posted by Nelson at 9:56 AM on April 28, 2016 [2 favorites]


According to both Crunchbase and some other databases I have access to, Draper Fisher Jurvetson and ATA Ventures were involved in both Series B and C, as well as C II, along with Tako Ventures. Series B ($10M), C ($28.5M), and C II ($45M) were for a total of $83.5M. The biggest rounds (2014 and 2015), totaling hundreds of millions of dollars, appear to be from undisclosed investors.

I don't know how accurate that opinion from NYT actually is; Randall Stross has been called a douchebag and idiot by Elon Musk, and his books appear to tend towards paeans to Silicon Valley heavyweights. It does appear to be a bit revisionist.
posted by Existential Dread at 10:24 AM on April 28, 2016 [1 favorite]


Oh god, you linked a Mike Arrington article about Elon Musk calling Randall Stross names. That's like the singularity of douchebaggery.

Thanks for the extra info from "some other databases". Any info on who invested in the Series A? Or how big Draper Fisher Jurvetson's re-up was? My impression from what I've read is ATA Ventures is the lead investor in the venture years, but it's complicated.
posted by Nelson at 10:42 AM on April 28, 2016 [3 favorites]


Sorry, the other database is CB Insights (paid access via employer); can't vouch for how accurate the info actually is. The series A has Draper Fisher Jurvetson as the sole investor, and the series size was $8.9M. The database doesn't break out the investment by VC firm.

Tako Ventures mentioned above is Larry Ellison's investment vehicle, apparently.

Re the Stross op ed: he mentions a "motley crew" of investors, but fails to mention Ellison's investment. He also calls ATA Ventures tiny ($450M capital under management), while quoting MPM Capital ($2B under management); the size isn't all that different between the two. A bigger red flag might be that MPM focuses on life sciences, while ATA appears to focus on IT.
posted by Existential Dread at 10:55 AM on April 28, 2016 [1 favorite]


Vanity Fair: The Secret Culprit in the Theranos Mess "The tech press may be as responsible as Elizabeth Holmes."
posted by OmieWise at 10:54 AM on May 4, 2016 [4 favorites]


I forgot who mentioned it, but someone pointed out that the culpable publications named are more mainstream press than tech press.
posted by Noisy Pink Bubbles at 11:53 AM on May 4, 2016


Yeah, I'm not sure how I feel about the article as a whole, but the argument is that here was this company that became a darling of the tech press (unvetted) and then got picked up by the mainstream press. But the thesis of the article isn't particularly supported by the particulars of the article.
posted by OmieWise at 12:20 PM on May 4, 2016


A fun article from 538: Theranos is wrong: we don't need more blood tests. tl;dr, even if the tests were very accurate (which they actually weren't), Bayes' rule sez you'll get a lot more false positives as you start testing more people. Of course had it actually been feasible, microfluidic blood tests would have other advantages (like not requiring phlebotomy) but I thought it was a good reality check on the idea that more "democratized" testing necessarily leads to more wellness.
posted by en forme de poire at 2:08 PM on May 13, 2016 [1 favorite]


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