"I saw some crazy things...Elizabeth took it to a new level."
January 26, 2019 5:09 AM   Subscribe

Theranos (previously, previously, previously), the now-defunct health technology corporation that defrauded investors, doctors and patients, has been back in the news recently after the release of new ABC investigative podcast The Dropout and film festival release of new HBO documentary The Inventor: Out for Blood in Silicon Valley. Both focus primarily on Theranos founder and CEO Elizabeth Holmes, who is awaiting trial with a possible 20-year sentence.
posted by rcraniac (44 comments total) 24 users marked this as a favorite
 
Holmes is going to get away with a fine or probation. She knows and implicated too many powerful people for a prison sentence. After that, we can expect her sobby redemption story.
posted by Foci for Analysis at 6:27 AM on January 26, 2019 [10 favorites]


I've wondered whether she was smart enough to come up with something useful if she'd wanted to run an honest business.
posted by Nancy Lebovitz at 6:30 AM on January 26, 2019 [1 favorite]


I wouldn't be surprised if she got away with a fine or probation, but I wouldn't be floored if she went to prison. She knows a lot of powerful people, but she also humiliated a lot of powerful people.

She's got to be some kind of genius as a grifter. She's young, and she's not going to go to prison for 20 years. I bet she ends up fine.
posted by ArbitraryAndCapricious at 6:32 AM on January 26, 2019 [6 favorites]


Has anyone listened to the podcast? I need something to listen to while cleaning my house today.
posted by ArbitraryAndCapricious at 6:35 AM on January 26, 2019


I just cannot understand this, after reading multiple "previouslies" about Theranos. How were their devices being used for actual diagnostic tests without being approved by the FDA?

And I've never seen in any article about Theranos how their tech was supposed to work. Does nobody even know?
posted by heatherlogan at 6:46 AM on January 26, 2019 [2 favorites]


Was there a small kernel of real initial results that initiated the funding for Thanos? Has that small bit of actual science been obscured or lost or was it all flim flam?
posted by sammyo at 6:52 AM on January 26, 2019


there was an interesting and weird article a while back that i considered posting as an fpp about how it should have been easy to tell that both her and that other fake billionaire fraud lady (anna something?) were grifters because they had such badly cut/styled/colored hair.
posted by poffin boffin at 7:02 AM on January 26, 2019 [9 favorites]


found it
posted by poffin boffin at 7:09 AM on January 26, 2019 [39 favorites]


Does this theory apply to male grifters too? I can think of at least one ....
posted by debgpi at 7:19 AM on January 26, 2019 [15 favorites]


You know, I think there is something to that hair argument for men and women grifters.
posted by Ashwagandha at 7:21 AM on January 26, 2019 [2 favorites]


Thanks for this! I read Bad Blood last year in two sittings and couldn’t stop talking about it to my sciencey friends. Podcast is definitely getting added to my listening list.
posted by WedgedPiano at 7:24 AM on January 26, 2019 [7 favorites]


Heatherlogan: There's a loophole for laboratory developed tests. If the process works properly they should be overseen by CLIA but Theranos purposely hid their equipment in a separate lab. They had one lab with analyzers they bought and one lab with the analyzers they developed. CLIA inspectors were not informed of the second lab. Of course, they weren't using the commercial analyzers properly, either. They were improperly diluting samples, the QC was a mess, validation studies weren't being done, samples weren't being centrifuged or shipped properly, etc. Many CLS and at least one pathologist left the lab and tried to report them. But they had a strong legal team that threatened and silenced them until the dam finally broke.

I highly suggest reading Carreyrou's Bad Blood. It goes into detail about how they were trying to get the analyzer to perform immunoassays and spectrophotometery side by side. It was an absolute mess.
posted by MaritaCov at 7:24 AM on January 26, 2019 [25 favorites]


strong legal team that threatened and silenced them until

Those turn and she could face real time.
posted by sammyo at 7:37 AM on January 26, 2019 [1 favorite]


All I wish for from this that George Shultz has apologized to his grandson, Tyler. To go from ‘your career would be ruined if this article comes out’ while the former US Secretary of State was on the Theranos board to
Tyler’s handling of the troubling practices he identified at Theranos is an example. He did not shrink from what he saw as his responsibility to the truth and patient safety, even when he felt personally threatened and believed that I had placed allegiance to the company over allegiance to higher values and our family
(emphasis mine, both quotes from the “awaiting trial” link) after the jig was up is quite shocking.
posted by scruss at 7:40 AM on January 26, 2019 [12 favorites]


Was there a small kernel of real initial results that initiated the funding for Thanos? Has that small bit of actual science been obscured or lost or was it all flim flam?

The ABC report doesn't mention Ian Gibbons, whom Elizabeth Holmes hired as science officer for Theranos -- and who ultimately killed himself on the verge of being deposed in a patent dispute involve Theranos.

He had been depressed and reportedly said of Theranos technology: "It doesn't work." His treatment by the company before and after his suicide was disgraceful.
posted by Modest House at 7:55 AM on January 26, 2019 [14 favorites]


I knew (due to the company board being filled with people like Jim Mattis and David Boies) that her parents had a lot of Washington connections. I did not know that her dad was a VP at Enron, and yes, that's hilarious.

So much of a successful con is just being able to project enough familiarity with something to seem confident about it. Being raised in Silicon Valley and having parents connected to governing elite would do a lot to build that level of poise. That's one reason I don't quite buy the "Elizabeth Holmes is unusually psychopathic" idea. People raised with excessive privilege are accustomed to not caring for the mass of humanity, and peddling imaginary medical technology is just a more proactive extension of the old "let them eat cake" mentality.
posted by grandiloquiet at 8:02 AM on January 26, 2019 [24 favorites]


being able to project enough familiarity with something to seem confident about it.

Amusingly enough, this is actually a skill that Stanford (and presumably others) teach their MBA students. Being able to lie through your teeth while dominating the conversation is apparently a valuable business skill, and a key facet of being an American Leader.
posted by aramaic at 8:30 AM on January 26, 2019 [20 favorites]


Was there a small kernel of real initial results that initiated the funding for Thanos? Has that small bit of actual science been obscured or lost or was it all flim flam?

The core idea, that you could use automated microfluidics to run many tests in parallel very cheaply, is an interesting one that is not necessarily fraudulent. Using capillary blood for (some) tests is also not necessarily a scam idea.

The problem is in the details:
1) Existing analytic techniques and most conceivable future ones have errors that are inherently linked to sample size, you could conceivably come up with ways of doing the underlying assay in such a way that even with a smaller size sample your errors are acceptable but there isn't really any way of breaking that scaling link.

2) Biological samples are inherently non-homogenous, if you get a really small sample you could be testing a non-representative sub-sample. That effects some tests more than others but it is *always* a concern.

3) The relationship between the levels of various substances in venous blood and capillary blood is really not well understood in some cases. Much worse, in some cases it is understood and what is understood is that capillary blood levels are inherently noisy predictors for venous blood levels.

I'm not sure there was much "smart" money invested in Theranos, my impression was that it was mostly not biotech investors who would have known the kind of thing to look for.

Anyway, all the above was known but some investors were presumably betting on Theranos being able to solve them for enough types of lab tests to have something worth actual money.

If Theranos had not started lying when they hit technology roadblocks and couldn't get it to work (presumably assuming that they would get it to work eventually) then no-one would be going to prison. Running a company that tries to develop a technology that doesn't work is not a crime and Holmes could have walked away with millions in compensation and liquidity take-outs from financing rounds without ever developing a real product. If they'd run their parallel lab (with the non-Theranos equipment) properly and only been unclear rather than deceptive about how many tests were actually being run on the traditional equipment then the harm would have been minimal.

Lying about how well your tech is working is fraud and deceiving people about medical tests is reprehensible. I will be staggered if she doesn't go to prison. (I will also be staggered if it's for 20 years though)
posted by atrazine at 8:36 AM on January 26, 2019 [48 favorites]


Was there a small kernel of real initial results that initiated the funding for Thanos?

I think the Titan achieved measurable results early on.
posted by doctornemo at 8:48 AM on January 26, 2019 [2 favorites]


Another vote for reading the book Bad Blood. So interesting on many levels!
posted by bookmammal at 8:52 AM on January 26, 2019 [4 favorites]


A few thoughts, based on the podcast's first episode:

Holmes' family impressed investors, and I can see why. She came from some money. Also, this tell from Wikipedia: "Holmes's father, Christian Rasmus Holmes IV, was a vice president at Enron..." Attended an elite prep school.

The cult of Apple played a role. All the PR and media glow compares Holmes to Steve Jobs, her design to Apple's, etc.

There's also an interesting Fyre Festival vibe here. A charismatic, young, physically attractive founder who seems nearly sociopathic; the cult of positivity, leading to axing people for raising issues; the buzz of money and celebrity.
posted by doctornemo at 9:53 AM on January 26, 2019 [7 favorites]


Yeah, con artists are a tale as old as time. She ran a great con. Thirding Bad Blood -- I devoured that book. The last 15ish pages read almost like clickbait, but the tale was engrossing and I couldn't put it down.
posted by sockermom at 10:07 AM on January 26, 2019 [2 favorites]


She knows and implicated too many powerful people for a prison sentence.

If you accept Carrelyou's account, she was actually quite a precocious grifter in that she identified and pulled in "powerful people" who usually not only weren't versed or even well-advised in the technology, but weren't even the kind of skilled businesspeople who as board members would have kept a closer eye on operations in a young company. (This is my inference from Carrelyou's facts; he doesn't quite come out and say this.) The amazing--even heartening--thing about the Theranos story is that as inside people kept figuring out what was going on, they kept quitting, and even telling on her. That is not what you see in a straight-up securities fraud narrative and genuinely speaks well of biotech/medical culture.

Was there a small kernel of real initial results that initiated the funding for Thanos? Has that small bit of actual science been obscured or lost or was it all flim flam?

This is the most striking and characteristically 21st-century element of the story, if you ask me. There was never anything. Holmes decided that there should be a device that somehow evaded all the known limitations of the existing science even though she never had any kind of fundamental insight on how to do it.
posted by praemunire at 10:09 AM on January 26, 2019 [33 favorites]


(Also, can I just say, as someone whose job it has often been to irritate companies doing shady stuff, Carrelyou was living the fucking dream. If I had a tape of a target chanting "fuck you, praemunire" (unlikely, as most people don't know how to pronounce it), I would play it every night before bed as I drifted off into sweet sleep.)
posted by praemunire at 10:16 AM on January 26, 2019 [19 favorites]


There was never anything. Holmes decided that there should be a device that somehow evaded all the known limitations of the existing science even though she never had any kind of fundamental insight on how to do it.
I was briefly acquainted with someone who worked directly with Holmes circa 2013. By their account, Holmes was both intensely secretive and also intensely hard-working. How much of that hard work went into propping up the scam versus pursuing legitimate business and R&D (however ineptly), I have no idea. But I do wonder what, if anything, separates the kind of scammer who gets caught up in her own hype—the true believer who is sure a breakthrough is just around the corner—from the kind of scammer who sets out to scam from the beginning.

Theranos could have had a perfectly good outcome by developing some incremental improvement to blood testing technology, laboratory processes, etc. and selling that. I assume Holmes also could have found a way to cash out or otherwise arrange a soft landing for herself earlier on. Instead, they went all-in for 10+ years (!) on pursuing what amounted to nothing at all.
posted by 4rtemis at 11:25 AM on January 26, 2019 [1 favorite]


What struck me after reading Bad Blood, which I do recommend for insight into specifics, is that regulation was really important in bringing the scam to light.

And that in what I conceptualize as a better society, people would be out pointing out that better regulation is needed for the front-line, health care cost cutting workers that were unwittingly becoming guinea pigs, the soldiers that almost were thrown forward, and last and least, the investors. That government has a serious role in protecting people from healthcare snake oil. That America can be Made Great again by creating agencies full of smart people outsmarting crooks and dreamers who don't care a bit about the human cost of their hubris.
posted by warriorqueen at 11:48 AM on January 26, 2019 [19 favorites]


I devoured Carreyou's book when it first came out because I have a shameful love of reading about the downfall of powerful blondes. It was much more rewarding than reading Marissa Mayer and the Fight to Save Yahoo!, since it quickly became impossible to take pleasure in Mayer's descent; she had hit the glass ceiling at Google and was relocated to a less-desirable department, then immediately set up to fall off the glass cliff at Yahoo. Yahoo had made huge mistakes well before Mayer came on the scene, like borking the purchase of Facebook and hiring media moguls who didn't even know how to use email.

That fascinating article about bad hair made me remember that blonde women are more likely to succeed anyway and therefore it isn't totally shameful to want to see them get their comeuppance!
posted by ziggly at 12:05 PM on January 26, 2019 [4 favorites]


But I do wonder what, if anything, separates the kind of scammer who gets caught up in her own hype—the true believer who is sure a breakthrough is just around the corner—

We have created a culture where basically all rich white people feel entitled to regard themselves as incipient geniuses regardless of whether there's any possible basis for it.

Holmes was a college sophomore dropout working in a mature and immensely technically complex area. There is no way she could ever have had a reasonable good-faith basis for believing she had solved these problems, except that she was trained from birth as a white child of privilege to think she could accomplish whatever she wanted to accomplish.
posted by praemunire at 12:38 PM on January 26, 2019 [30 favorites]


about how it should have been easy to tell that both her and that other fake billionaire fraud lady (anna something?) were grifters because they had such badly cut/styled/colored hair.

oh, the hair article, by the author whose specialty this is. her whole thing about Holmes giving herself away by not knowing you're "allowed to care" about what you look like after a certain success point. right, because the only limit to how much money and time we honest girls spend on our hair is what is allowed by our net worth and social stratum. because the only reason you would ever not have a particular hair process done is if you were too class-ignorant to know you were supposed to do it. because actual non-grifter entrepreneurs are consumed with making sure they look the way they're supposed to - as long as they have that intangible but all-important social permission, of course.

this is on the level of thinking you've spotted an imposter in grad school because she's wearing lipstick and you read in an editorial once that academics never do that for fear of looking unserious. writing up gender Laws and then congratulating your eagle-eyed self for noticing that people break them, that's something.

her thesis doesn't just require that all women care an immense amount about how they look, are all eager to dress for success in whatever form, and all agree about what is the best costume for the day. it also assumes that nothing grows out of a woman's body without her express approval and intention. therefore women who don't spend hours at hair salons must be splitting their ends on purpose, to make a point, to be "read" a particular way. she's so delightfully certain of this. it's like she read the old standard about how women's appearance is rarely regarded as a neutral thing, and made the incredible leap to writing as if it meant that women don't have a neutral state. like, we all understand that the color of your hair as it grows out of your head can be read as an aesthetic choice. but she writes like she thinks that means it actually is one.

anyway, so because she simply declares all her premises instead of establishing or arguing them, it follows for her that any woman who can afford to match the style norms of her ostensible peers, but doesn't, is a fraud who doesn't understand what the norms are. real great thinkwork there.

what the writer doesn't understand, because her job relies on her not understanding it, is if you're rich enough you don't have to give a shit about what some Atlantic hack thinks women of your class should spend their leisure hours on. she figured out that money buys you into the power to conform to the most elite of beauty standards, but fails to understand that money also buys you right clean out of having to care about them. that goes for middle-class pretenders, scientific frauds, real geniuses, and old money princesses alike. you have enough money, you don't actually have to care about whether you look like you have money. But since not caring about salon appointments is only intelligible to her as a calculated pose, a whole artificial style of its own, she can only see the evidence of this as a style failure: as a woman's body telling on her.

the dumbest thing about the Delvey part is that people who actually were rich saw Delvey's hair clear as day and IT DIDN'T MATTER. they still thought she was one of them, for a while, and they still lent her money, for a while. they didn't suspect a thing based on her imperfect salon attendance. because the whole hair code business is more important to the writer than to the classes she writes about.

tl; dr: looking like you don't give a shit about your hair isn't the class tell she thinks it is.
posted by queenofbithynia at 12:44 PM on January 26, 2019 [42 favorites]


"We have created a culture where basically all rich white people feel entitled to regard themselves as incipient geniuses regardless of whether there's any possible basis for it.

Holmes was a college sophomore dropout working in a mature and immensely technically complex area. There is no way she could ever have had a reasonable good-faith basis for believing she had solved these problems, except that she was trained from birth as a white child of privilege to think she could accomplish whatever she wanted to accomplish."


A friend of mine had a dream where he came up with the idea for a product called Peanut-Better: zero fat peanut butter that tastes as good as the real thing. When he woke up, for a moment he was very excited "This is amazing! What a great idea! I'm going to be rich!". Then he woke all the way up and realized he didn't actually know how to make Peanut-Better a reality.

Sounds like Elizabeth Holmes woke up from her Peanut-Better dream and didn't have the good sense to laugh it off like my friend did.
posted by Secret Sparrow at 3:25 PM on January 26, 2019 [17 favorites]


a product called Peanut-Better: zero fat peanut butter

Umm yeah. Walden Farms Calorie-Free Peanut Spread.
posted by heatherlogan at 4:32 PM on January 26, 2019 [2 favorites]


Regarding the podcast, just one ep up so far -- so if you want to marathon the whole thing you'll want to wait a bit.
posted by snuffleupagus at 6:23 PM on January 26, 2019 [1 favorite]


Umm yeah. Walden Farms Calorie-Free Peanut Spread.

Sure, but the key feature of Peanut-Better is that it tastes as good as regular full-fat peanut butter. That Walden Farms product, after 529 reviews, has a one star rating.

Sample review:
"I'm extremely saddened because I'm on the strictest detox diet in the universe and I really really very badly wanted this to be good. I truly truly did. I didn't even read the reviews because I figured maybe it was just internet people being negative, as per usual...

But HOLY MOLY, this stuff is awful. When I opened it, it smelled like Turmeric and wet terracotta pottery. And regret and sorrow and destroyed dreams. It tasted even worse. I dont even know on what planet this would constitute as a peanut butter substitute. Have they ever even tasted peanut butter?"
Safe to say it's no Peanut-Better.
posted by Secret Sparrow at 6:53 PM on January 26, 2019 [18 favorites]


Metafilter: it smelled like Turmeric and wet terracotta pottery. And regret and sorrow and destroyed dreams.
posted by Chrysostom at 9:18 PM on January 26, 2019 [4 favorites]


I found the podcast tough to listen to. They dug up a lot of random people from her past who come across as petty, jealous, thrilled that she’s finally getting her comeuppance, and a little too happy to take shots at her appearance and voice. I just don’t find that stuff attractive, interesting or good storytelling.
posted by thejoshu at 9:57 PM on January 26, 2019


Turmeric and wet terracotta pottery-better doesn't have quite the same lilt.
posted by axiom at 10:59 PM on January 26, 2019


Her hair, really?

I mean, I'm not too sophisticated to not make fun of someone's appearance, even a woman's. Hell, every photo I've seen of her creeps me out with that Heaven' Gate stare she seems to employ. But having the gall to sport insufficiently sophisticated hair coloring is such bottom of the barrel snark.

Her biggest talent had nothing to do with medical innovation, but rather selling ideas to powerful and connected people. Collecting legitimacy by proxy was her true gift. George fucking Schultz deserves to be laughed and pointed at for the way he treated his grandson. Way to throw around (and piss away) your authority, gramps. Tyler should lord it over him the rest of his life.

I'd wondered in past threads how she ever thought this could turn out. It's not as if this were some kind of nutritional supplement where all kinds of unfounded claims could be made and got away with. This was an actual medical procedure. One might be able to get away with it in small solo practice as a kind of "alternative medicine" regimen. But wooing such high profile backers and money would eventually shed light on the scam. Was it purely dishonest with no long term plan? Was she holding faith that the concept was viable and would come to fruition if she could just stall for a little more time, funding and positive outlook? I've employed a fake-it-'til-you-make-it strategy before, but not with other people's money, and never with a talent that was based on wishful thinking or simply non-existent. It was simply too high profile, too much money, too regulated a field for this to have panned out without the wheels falling off. And fall off they did, the most encouraging, if not predictable, thing to have come out of this whole saga. Before it got to cause too much real physical harm to people.
posted by 2N2222 at 11:02 PM on January 26, 2019 [5 favorites]


Umm yeah. Walden Farms Calorie-Free Peanut Spread.

LOL. Theranos 2!

From the amazon page:
About the product
Walden Farms Calorie Free Ketchup has a rich natural tomato flavor made with California sun ripened tomatoes, pureed onions, lemon juice, crushed garlic, apple cider vinegar and more
Best quality product
Gluten-free and Non-GMO, Effervesce combines Authenticity with Elegance and Prestige
posted by srboisvert at 5:22 AM on January 27, 2019


That America can be Made Great again by creating agencies full of smart people outsmarting crooks...

Wow. You could even start a political movement using that slogan as a motto. Of course, once you're *in* power, you could systematically destroy all regulatory agencies, arguing that they're impediments to progress, and unnecessary, since for-profit corporations are self-policing and inherently moral.

Nah, that'd never fly in the wake of Enron, Theranos, and the subprime mortgage scandal.
posted by panglos at 8:24 AM on January 27, 2019


therefore it isn't totally shameful to want to see them get their comeuppance

this is stupid
posted by stoneandstar at 10:18 AM on January 27, 2019 [3 favorites]


@atrazine. i wish you broke your comment into two parts because I only got to favorite it once.
posted by drowsy at 11:16 AM on January 27, 2019


I'm just listening to the Dropout podcast now.

I have to say, if I were Stanford University, I would be embarrassed to continue having George Shultz on the faculty anymore. I don't think he's criminally liable for anything, but would you take a business class from a man who gleefully bought into a billion dollar fraud just because a pretty white girl "impressed" him? And then bullied his own grandson for confronting him with proof of the sham?
posted by dnash at 7:53 AM on February 21, 2019 [2 favorites]


from Vanity Fair: She Never Looks Back: Elizabeth Holmes's Final Days at Theranos. I am surprised by that Holmes keeps getting described as the woman who conned Silicon Valley. As many have mentioned, most of the money came from elsewhere. The Silicon Valley hype machine worked in her favor, but then, that's...what is does. Whether you're peddling juice packs or taxis or platforms or fake bodegas, it's not hard to scare up positive press.

Very few people come off well in the Dropout podcast, which makes it well worth a listen! Tyler Shultz does, maybe, and his grandmother for sure. The people who believed Holmes sound dumb as hell now. (Yes, I KNOW everyone can get duped and blah blah blah, but still. Several men explained that they were "impressed" that she dressed in turtlenecks and had a deep voice. It is the voice a little girl would use if you asked her to impersonate her father. It is a silly improv voice. But apparently, that's the voice women should use if we want to scam a bunch of investment money out of credulous men.)
posted by grandiloquiet at 11:41 AM on February 21, 2019 [1 favorite]




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