Throughout Bad Blood, John Carreyrou’s excellent new book about fraudulent blood-testing company Theranos and its founder Elizabeth Holmes, the $9 billion company keeps running into the same problem: would-be investors or retailers want to see a demonstration of its technology. This is an issue for Elizabeth Holmes’s company, because their shit definitely doesn’t work.
Holmes and her colleagues get around this a number of ways: In Switzerland, they ping a fake result from California in real time; often, they just blame a crappy wireless connection and somehow get away with it. People—not including the current Secretary of Defense or Stanford chemistry or engineering professors—raise the alarm, and somehow have their obvious objections dismissed. This happened most hilariously at Walgreens, whose own laboratory consultant, Kevin Hunter, was ignored for the dumbest possible reason:
After they hung up, Hunter took aside Renaat Van den Hoof, who was in charge of the pilot on the Walgreens side, and told him something just wasn’t right. The red flags were piling up. First, Elizabeth had denied him access to their lab. Then she’d rejected his proposal to embed them in Palo Alto. And now she was refusing to do a simple comparison study. To top it all off, Theranos had drawn the blood of the president of Walgreens’s pharmacy business, one of the company’s most senior executives, and failed to give him a test result!
Van den Hooff listened with a pained look on his face.
“We can’t not pursue this,” he said. “We can’t risk a scenario where CVS has a deal with them in six months and it ends up being real.”
Holmes’s technology was totally worthless; Walgreens had firsthand evidence of this; Theranos had the blood of one of their senior executives and refused to say anything about it; but CVS exists, and so Walgreens went on to spend $140 million with Theranos over seven years. They recouped less than $30 million of that in a lawsuit and settlement.
At least this scam soaked the worst people in America for hundreds of millions of dollars along the way. Please enjoy the whole book. There’s well-founded speculation in it that Holmes’s speaking voice is fake.