One week after this announcement comes the news that a major investor, Partner Fund Management LP, is now suing Theranos, alleging that the company engaged in securities fraud and other fraudulent acts to attract investment. Partner Fund, which had invested nearly $100 million in Theranos, claims that both Holmes and former company president Sunny Balwani lied about the company's scientific capabilities, specifically about its flagship Edison testing platform.
I must admit that I certainly admired Holmes when I first read about her (and even felt a tinge of envy!). However, I never really understood the scientific basis of Theranos' technology - which is not surprising since the company seemed to fetishize secrecy - and eventually began to doubt the authenticity of their claims. I'm sorry my doubts were proved to be correct, and I think the most fitting story to this coda comes from the interview with Dr. Stephen Master, an expert who quizzed Holmes during her August presentation at the American Association for Clinical Chemistry:
"Q. Are there any lessons that you think investors and Silicon Valley can learn from what went wrong at the start-up?
A. There is the sort of obvious one, which is: when you are dealing with patients, the bar is set higher."