WIKIMEDIA, GLENN FAWCETTA government health regulator has banned Elizabeth Holmes, founder and CEO of the embattled blood testing startup Theranos, from operating a lab for at least two years, the company announced yesterday (July 8). The Centers for Medicare & Medicaid Services (CMS) also yanked the certificate for its Newark, California lab, imposed an unspecified fine, and suspended approval of Medicare and Medicaid payments for lab services, according to the statement.
“We accept full responsibility for the issues at our laboratory in Newark, California, and have already worked to undertake comprehensive remedial actions,” Holmes said in the statement. “While we are disappointed by CMS’ decision, we take these matters very seriously and are committed to fully resolving all outstanding issues with CMS and to demonstrating our dedication to the highest standards of quality and compliance.”
The Newark lab’s revocation takes effect in two months’ time, but Theranos said it would not conduct any patient testing there “until further notice.” In the meantime, the facility will be shut down and rebuilt “from the ground up,” and the company will hire new leadership and personnel, Homes said in the statement. The company said it will continue to serve customers at its Arizona lab.
Theranos, which was founded by Holmes in 2003 and was previously valued at $9 billion, is now worth about $800 million, according to Ars Technica. Federal officials launched a criminal probe into the company following media reports questioning the accuracy of its claims. Walgreens recently ended its partnership with the company.