Theranos is about to shut down for good

Ben Davidson
September 7, 2018

In the wake of a high-profile scandal, the company will formally dissolve, according to a shareholder email obtained by Dow Jones Newswires.

There are many outstanding questions surrounding Theranos, not least the outcome of Ms Holmes and Mr Balwani's forthcoming fraud trial, as well as whether the remaining patents being acquired by Fortress will turn out to have any lasting value. Thus, Theranos came into existence. The blood test, where samples of blood are traditionally drawn through needles into large vials - often several - is probably the most common, and the most dreaded, laboratory procedure around. The patch would consist of a blood collection vessel dubbed as the "nanotainer", and an analysis machine called the "Edison".

The firm was one of the darlings of Silicon Valley after raising $700 million from investors.

Its principal blood-testing product was once seen as a potential breakthrough in the health care industry. The company reached its peak in 2014 and was evaluated at around $10 billion. At one time, Holmes was the youngest self-made female billionaire.

The action is the final act in Theranos' dramatic downfall.

The Wall Street Journal, which reported the initial explosive allegations against Theranos, now reports that the firm will dissolve. This was followed by a Food and Drug Administration (FDA) report that claimed that the "nanotainer" was "not validated under actual or simulated use conditions".

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The Journal's investigation marked the beginning of the end of Theranos. Soon, her net worth had dropped to virtually nothing and the company was on the verge of bankruptcy. Theranos does not have enough cash to keep going under terms of a loan from Fortress Investment Group it secured past year, according to the letter.

Holmes and Balwani in March were also charged by the Securities and Exchange Commission with "massive fraud".

The blood-testing company Theranos, once hailed as a life-saving medical revolution, is to shut down amid claims its executives have conducted years of fraudulent business.

But an investigation by The Wall Street Journal two years ago found that Theranos' technology was inaccurate at best, and that the Palo Alto, Calif. -based company was using routine blood-testing equipment for the vast majority of its tests.

With approval of the company's board and shareholders, Theranos will begin the corporate dissolution process Monday, CEO and general counsel David Taylor said in a note to shareholders.

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