Theranos, a medical testing company that uses proprietary technology to take and test patients’ blood and other bodily fluids, is also a Silicon Valley sweetheart led by a young, charismatic founder who is also one of America’s youngest female billionaires. Elizabeth Holmes, 31, promises her company is “pioneering a new paradigm in which lab testing is accessible and affordable for everyone.” Exactly how Theranos does that is still a bit of a mystery. The company is estimated to be worth $9 billion.
That’s in part because Theranos has, as one prominent scientist put it in a critical opinion piece that ran in JAMA in February “operated in stealth mode for more than a decade.”
The company doesn’t talk about what makes their proprietary technology work. As of now Theranos doesn’t publish its work through the traditional scientific channels; outside scientists haven’t been able to test the processes to see if the technology does what’s promised, although the company has submitted dozens of its tests and procedures for FDA approval. In a talk the CEO gave last month, Holmes said Theranos will publish its data in the future. The company has been certified under the federal Clinical Laboratory Improvement Amendments, which applies to all human laboratory testing in the United States.
What we do know about Theranos comes from what the company tells the mass media, from the company website, and through patent applications and highly redacted FDA inspection documents. As to whether the company lives up to the hype, the company claims its users love it, but for some others in the scientific community the jury is still out. A Wall Street Journal investigation questioning the lab’s accuracy brought increased scrutiny.
Here is what we know.
The promise
Holmes has described Theranos as a game changer for the medical industry. In a popular TEDMED talk Holmes tells a moving story about a beloved uncle who died too young after his skin cancer all of a sudden “was brain cancer and in his bones,” she said. “Diseases often begin so much earlier than when symptoms appear. We see a world in which everyone has access to actionable health information at the time it matters … a world in which no one has to say good-bye too soon.”
Clues from patent applications
Dozens of Theranos patent applications cover both process and technology. The application for one of the patents said these could be used at a doctor’s office, a drugstore, a supermarket or even in a person’s home. Using a tiny volume of a person’s bodily fluids — blood, saliva, semen or even earwax, tears or other fluids — the company’s technology will analyze that sample for a variety of maladies. Other patents are for tests that would tell in real time if someone has the flu or bird flu or has blood coagulation problems.
Website claims
The company says it has performed 3.5 million tests since it started offering them nearly two years ago. It runs wellness clinics in three states, has worked with more than 9,000 doctors, and partnered with drugstore giant Walgreens. It touts a relationship with the highly regarded Cleveland Clinic, although the hospital system said it won’t comment about the product because it has not seen the technology nor worked with it yet. The facility wants “to see this technology develop,” Dr. Toby Cosgrove, Cleveland Clinic CEO and president said in a Q&A with Holmes in October.
Customer surveys are positive. What sets Theranos testing apart from centralized labs: the amount of blood it takes, the cost, and the speed with which Theranos can turn results around, the website said.
Smaller needle tests awaiting FDA approval
Of the tests it offers, many use needles Theranos says are smaller than those commonly used in the industry. The company also uses finger-stick tests. Theranos said it used the finger-stick method in more than 80 items on its test menu. A finger-stick nicks your finger and draws a small blood sample on which Theranos can run a wide variety of tests, looking at everything from calcium levels to cholesterol to cancer and other aliments not historically tested with this method.
Finger-stick technology has been around for years. It works for some diseases, but studies looking at other companies’ finger-stick tests have found the method has limited accuracy. A lack of standardization can also confuse results. The FDA has approved only a Theranos finger-stick test for herpes; the rest await FDA approval.
Smaller sample sizes
Theranos says it doesn’t need to take as much blood as a conventional blood test. Blood tests that require less blood can be “life-changing” a Theranos spokesperson said in an emailed statement to CNN. “Especially for guests who have to get frequent blood tests, the smaller draws that we use can make their treatments much more bearable.” When launched, the tests took enough blood to fill a tiny vial the company calls a Nanotainer. After an August inspection, the FDA said the tubes were an “unapproved” medical device. As a result, the company “paused” its use of the Nanotainer in all but the herpes test. They do still offer tests that are “requiring far less blood,” according to the spokesperson.
In a traditional test, how much blood a phlebotomist takes depends on the tests you are having done, according to Dr. Blair Holladay, CEO of the American Society for Clinical Pathology, the association for pathologists and lab professionals. A small tube is about 5ml or half a tablespoon. A bigger tube is twice that amount. They may have to fill more than one tube to run different tests. “It may seem like they pull lots and lots of tubes, but that’s only if a doctor wants multiple tests. Depending on what that test is, it goes to different sections of the lab,” Holladay said.
Typical labs have 15 to 20 areas that specialize in different diseases or reactions. Chemists work with some samples, microbiologists work on others. A phlebotomist may also pull extra as a precaution. “Quality assurance is important. You don’t want to have to ask people to come in again and again if something goes wrong with the initial test,” Holladay said. “A lot of quality control is built into the system to verify results.”
Theranos also has the ability to retest samples, according to the company spokesperson. “Theranos’ lab tests and processes are designed with multiple redundancies that allow for retesting if necessary.”
Testing speed claims
Theranos says it can turn around results much quicker than the traditional industry. It has speeded up the process in part because many of the tests are done at the same site as the lab. “We locate our testing labs within a short drive of our Wellness Centers, which eliminates travel costs as well as long transport times that can affect the quality of the results,” the Theranos spokesperson’s emailed statement said.
It also uses a technology to load blood from a finger stick into a “reader” for analysis. Results go from the reader to a secure database and back to the patient’s phone, and to the doctor if the patient has one. Patients can have direct access to these tests.
If conventional tests take longer it’s most often due to logistics. If a lab is off site, samples need travel time. Because doctors typically look at test results at the end of the day, “sometimes a regular blood test seems like it takes longer to run than it actually does,” Holladay said.
Testing price
Theranos lists prices and the tests it offers online like a menu. More than 150 of the tests cost less than $10. All tests cost 50% to 80% below Medicare reimbursement rates, a spokesperson said in a statement. The spokesperson attributes the lower costs to “low overhead” and the company’s “proprietary innovative scientific process that allows us to offer tests at much lower costs.”
Pricing for traditional tests is based, in part, on what the market allows and could “stand some improvement” according to Dr. John Ioannidis, of the Stanford Prevention Research Center. He’s the author of a piece that ran in JAMA that complained about Theranos’ lack of transparency.
“Much of what makes current testing expensive is that companies are used to making a large profit,” Ioannidis said. “Even if you were using some of the oldest technology available, a company could charge less and cut down on the cost, but everyone is a part of a large bureaucracy involved in the current system wants to take a cut.”
The scientific literature
Theranos says it has “vigorously tested” its proprietary technology and rather than try its case in the scientific literature, the company submitted its work to the FDA “by choice, not necessity — because we are seeking to create a new model for laboratory testing standards,” a website statement said.
For scientists like Ioannidis, that isn’t enough.
What we know about Theranos comes “from anecdotes and heavily redacted FDA guidance. And now we are seeing that there are some kinks in their system with the Nanotainer,” Ioannidis said. “I applaud their going to the FDA for approval on so much and hope other labs will follow their example, but their results need to be checked out (by the broader scientific community in peer reviewed journals). Is it reproducible in the scientific community? This is a major deficiency. We have been misled many times about innovations in medicine before.”
“They may be scientifically sound, but this is the process we depend on in the scientific community,” Ioannidis said. “Let something be tested to see if it is sound.”
The company said it does plan to release its data in the future. As far as the company being tight-lipped about its technology, the Theranos spokesperson put it this way in the emailed statement: “In order to compete in this space, in order to disrupt a staid industry dominated by two behemoths, there are some parts of our technology that we do not discuss in order to protect our intellectual property. We don’t keep these parts of our technology a secret from our regulators — the FDA has full access and transparency into our technology — we have committed to their review and clearance. But we do keep these parts of our technology a secret from our competitors, just as any successful business would do.”