Elizabeth Holmes

Elizabeth Holmes is a businesswoman and the founder of Theranos, a Palo Alto-based health technology and blood testing company that was found to be fraudulent in 2016. Theranos claimed to have revolutionized the process of blood testing. As of December 30, 2021, Holmes is on trial for eleven federal charges related to wire fraud; jury deliberations began on December 20, 2021.

Holmes was born in Washington, D.C. on February 3, 1984, to parents Noel and Christian Holmes. During Holmes's childhood, Noel was a congressional committee staffer, and Christian was the vice president of the energy company Enron. Enron was also rendered defunct in 2001 after fraudulent accounting practices were revealed. However, it is unknown when exactly Christian Holmes was employed by Enron. It is unlikely that he was involved in any wrongdoing at the company since he was not convicted of or implicated in any of the fraud charges against the company and its employees. On her father's side, Holmes is also a descendant of Charles Fleischmann, the founder of Fleischmann's Yeast. Holmes and her family moved to Houston, Texas, when she was a child. She graduated from St. John's School in Houston in 2002.

After high school, Holmes attended Stanford University. After her freshman year there, she was an intern at the Genome Institute of Singapore, where she practiced methods of testing for severe acute respiratory syndrome, or SARS. This experience led to Holmes developing the concept of a transdermal patch that would be able to track the level of drugs in the wearer's bloodstream, adjust the drug dosage if needed based on their levels, and wirelessly transmit that information to the wearer's doctor. She later filed a patent for this technology. This idea led to the idea of Theranos. After returning to Stanford, Holmes approached the dean of engineering about being her new company's advisor, who agreed after Holmes began producing prototypes. She soon dropped out of Stanford and funded her newly established company with her college fund. In 2003, Holmes officially founded Theranos. The name Theranos is said to be a portmanteau of therapy and diagnosis.

Holmes wished to distinguish Theranos from other blood testing companies in two ways: by offering tests at half the cost of Medicare and by using quicker, less invasive blood testing methods. She also believed these key factors would result in more people getting needed tests, citing her own fear of needles as a reason why many people put off blood tests. Holmes claimed that Theranos's exclusive blood testing machines were capable of detecting hundreds of diseases in just a couple drops of blood. Although founded in 2003, Theranos was not publicly active until 2013; the company didn't have a web presence or press releases. The years prior were spent developing hundreds of blood tests and dozens of patents.

In September 2013, Theranos became publicly active for the first time when it announced a partnership with Walgreens. The partnership opened Theranos blood collection clinics in select Walgreens locations. Even before Theranos was put into the public eye, it had raised a substantial amount of money in funding from several high-profile investors. Altogether, Theranos raised hundreds of millions of dollars in funding, with reported figures between $800-$945 million.

In October 2015, John Carreyrou of The Wall Street Journal published an exposé article regarding Theranos employee concerns and allegations about the company and its testing methods. It was revealed that Theranos had been doing the vast majority of its blood testing on commercially available machines, not on its exclusive Edison machines as was claimed. One employee claimed that Theranos had failed to report potentially inaccurate test results that could have indicated a faulty testing system. Some blood test results were found to be so inaccurate that the patient would have had to be dead for the reported test levels to be correct.

The article prompted several investigations into the company, its technological claims, and its purported finances. Theranos's Newark-based lab was inspected in December 2015; a warning letter to the company from the US Centers for Medicare and Medicaid Services followed in early 2016. The letter stated that Theranos had ten days to provide evidence of corrective measures taken to address the outlined concerns from the inspection, which included deficiencies with the lab's analytic systems and some of its personnel. In April 2016, both the U.S. Securities and Exchange Commission (SEC) and the U.S. Attorney's Office launched investigations into Theranos's financial claims.

In May 2016, Theranos was faced with two class-action lawsuits filed just one day apart; one accused the company of false marketing regarding its claims of blood testing capabilities, and the second accused Theranos of a breach of contract with the plaintiff, also regarding the company's false claims of testing capabilities. In March 2018, Holmes was charged with fraud by the SEC. As a result, she paid a $500,000 fine, returned 18.9 million shares of company stock, and was disallowed to be a director or officer of a publicly traded company for the next ten years.

Holmes was indicted by a federal grand jury on June 15, 2018. The allegations against her include providing false financial information and knowingly providing misinformation about Theranos, its testing capabilities, and how its blood samples were tested. She is charged with nine counts of wire fraud and two counts of conspiracy to commit wire fraud, which faces a maximum sentencing of twenty years in prison and a $250,000 fine if convicted, plus restitution for each charge.

Holmes's trial began on August 31, 2021. The trial has experienced a number of delays, both before its start and during. It was finally pushed to August 31, after Holmes was confirmed to be pregnant and expecting to give birth in July. Holmes gave birth on July 10. The trial was delayed on September 10 after a juror was exposed to COVID-19 and again on October 29 due to a broken water main near the courthouse.

Several former Theranos and Walgreens employees testified during the trial that Theranos was secretive about their business practices and often falsified claims and information to investors and partners, such as showing them falsified company endorsements. Some of the employees who testified said they had quit due to their concerns that were not being addressed by either the company or Holmes.

Holmes was recognized by Forbes in 2015 for being the world's youngest female self-made billionaire with a net worth of $4.5 billion. After Theranos was accused of incorrect revenue reporting, both the company's and Holmes's net worth plummeted; Forbes revised Holmes's to $0 and Theranos's to $800 million, down from $9 billion.