Theranos devices ran “null protocol” to skip actual demo for investors
There is a saying in the startup world that many companies try to fake it till they make it. From yesterday’s testimony in the criminal trial of Theranos founder Elizabeth Holmes, it sounds like her company took that saying to heart.
Prosecutors questioned Daniel Edlin, a former product manager, about Theranos’ investor pitches and other relationships, trying to build the case that the blood-testing startup knowingly misled investors about the capabilities of its technology.
Edlin was recruited to work at Theranos through his friend Christian, Holmes’ brother—the two had attended Duke University together. At the startup, he was involved in a range of investor-related activities, including giving tours. Each tour was scripted—that’s not surprising—but the path was approved by Holmes herself, Edlin said, which adds to evidence that she had the final say on many investor-related matters. Before one tour, he recalled, Theranos’ proprietary testing devices were set up in a room to look like they were in active use.
In one notable demo given to an unnamed person in New York in June 2013, Theranos tested the person’s blood twice—once in New York and again at the company’s lab at its California headquarters. The two different runs gave different results. “The discrepancy will be a problem. We need to see if we can correct for it,” Holmes wrote in a group email. In response, Daniel Young, a Theranos executive, told Edlin to change the reference ranges, which would cause the results to appear to fall within the normal range.
