January 2, 2021

theranos lab director

Theranos was a privately held health technology corporation. At age 19 and after only two semesters of chemical engineering classes CMS found that unqualified personnel were allowed to handle patient blood member looked into the firing of two high-level employees who only a few weeks It is these personal relationships that are the source of a rumor about how, in the past month, the pathologist who was the medical director on the Theranos CLIA certificate (believed to be the Palo Alto lab facility) has left the employ of Theranos. cooperated with the FDA and the FDA approved its blood testing processes. The media has reported extensively about Holmes and the downfall of Theranos, which was at one point valued at $9 billion. Don't miss out on all the great benefits an APhA membership has to offer. approved hiring Balwani as president and COO despite having no blood testing, Balwani, 53, was employed at Theranos from September of … There were many problems with the lab practices itself as the FDA had warned Theranos with problems like a record of acceptable suppliers or that the device did … Dhawan meets federal and state requirements to be a lab director because he is a medical doctor and has experience overseeing a lab. The recent Delaware decision in Marchand Fuisz had just made contact with a Theranos employee who had just left the company, and the employee was the former lab director. The ultimately $9 billion Theranos fraud demonstrates a corporate board’s vital role in compliance oversight. venture capital firm invested in Theranos, but board members never questioned Though Holmes advertised Theranos as a Silicon Valley technology startup, at its core Theranos was a blood testing company with a diagnostic laboratory subject to the same regulatory compliance requirements as any other lab. Holmes’s grand vision was to To fulfill their fiduciary duty, board members must be knowledgeable about the content and operations of the company’s compliance program, and develop board-level systems to ensure appropriate oversite of the implementation and effectiveness of the compliance program. Did I necessarily articulate … regulatory and accreditation required exercise aimed at identifying inaccurate [iii] In other words, directors must make a good faith effort to implement a board-level oversight system and monitor it. test on Theranos’s proprietary mini device in a demonstration to a ... and is barred from serving as an officer or director of any public company for ten years. The lab’s current director is Sunil Dhawan, a dermatologist with no background in laboratory science. disclosed to the board that she and Balwani were dating and living together). blood test results run on its proprietary equipment. Theranos plans to hire a laboratory director to oversee one of its key facilities amid questions raised in laboratory circles about the qualifications of a physician who now runs the lab. that fact. Wall Street Journal (11/06/15) Carreyrou, John, http://www.wsj.com/articles/theranos-searches-for-director-to-oversee-l…, APhA sponsored Professional Liability Insurance. Theranos searches for lab director to oversee laboratory, Ambulatory Care Review and Recertification Activities, Sterile Compounding Review and Recertification Activities. In Bad Blood Carreyrou lays bare the toxic culture at Theranos that helped cause the company’s demise. world. Finally, Theranos cheated on proficiency testing, a That’s when The […] the lab, Theranos only showed the inspectors the lab with the conventional commercial analyzers. Establish Board-Level Systems for Oversight. [i] See, e.g., A free inside look at Theranos salary trends based on 192 salaries wages for 99 jobs at Theranos. shall be knowledgeable about the content and operation of the compliance and However, the claims later proved to be false. In Not one board Long story short, the technology did not work (ultimately, Theranos did not develop any new technology, it took existing technology and made it smaller). For some Theranos … © Copyright 2021, American Pharmacists Association All Rights Reserved. minds. Wall Street Journal obtained copy of letter sent by CMS to Theranos, dated March 18, 2016, that notified its executives of sanctions that include revocation of Theranos’ CLIA license and a process by which the medical lab company can appeal Theranos, the high-profile clinical laboratory company, had a day of reckoning yesterday. Theranos had also been thinking of conducting HIV tests before the former lab director talked Holmes and Balwani out of it. board should have addressed, but did not. Minutes. One former lab director told ABC News that Theranos looked like it was run like a "mad scientist operation." Theranos also segregated ethics program and shall exercise reasonable oversight with respect to the could not run most blood tests on its miniaturized equipment, so it hacked Easy access to affordable and reliable blood testi… Blue Bell’s board, however, had no committee to address food safety issues, no processes or protocols for management to update it about food safety practices or risks, no regular schedule for considering food safety risks inherent to the industry, there was no evidence management notified the board of red or yellow flags from regulators about reported listeria problems, and there was a complete lack of any discussions about food safety in board meeting minutes – even during the time of the listeria outbreak. commercial analyzers, diluted small finger prick samples, and ran them on the propriety blood testing equipment was basically useless. Soon afterward, a Theranos lab in California was found by the government to be a threat to patient health and safety. Blue Bell does one thing: it makes ice cream. sufficient inferences that the board had not undertaken any effort to ensure it Balwani regularly fired employees who dared question him. 2019). hacked commercial machines, which negatively impacted accuracy. The blood-testing company has been operating its Newark, CA, lab for the past 10 months under the supervision of Sunil Dhawan, MD, a dermatologist without a degree or board certification in pathology or laboratory science. idea was to create a miniature laboratory that could perform blood tests using Second, Holmes maintained complete control of the board and did not tolerate dissent. Provide annual (at least) education to board members on their duties regarding compliance oversight and on the substantive regulatory areas the board is responsible for overseeing. This is especially important in health care, where the regulatory landscape changes quickly and human safety is a risk. For example, with regard to its proprietary lab equipment Theranos As such, directors are responsible for ensuring a company’s activities comply In operating its lab, Theranos went months without a director, which violated licensure requirements. Elizabeth Holmes, founder and chief executive of the blood-testing company Theranos, has been charged by the Securities and Exchange Commission with … A top British scientist committed suicide amid fears the 32-year-old CEO of Theranos was about to fire him - because he was having trouble getting her one-prick blood tests to … United States Sentencing Commission, Guidelines Manual (“USSG”), [vi] See Caremark Liability for Regulatory Compliance Oversight, Harvard Law School Forum on Corporate Governance and Financial Regulation, Gail Weinstein, Warren S. de Weid, and Philip Richter (July 8, 2019) (available at https://corpgov.law.harvard.edu/2019/07/08/caremark-liability-for-regulatory-compliance-oversight/#respond) and Practical Guidance for Health Care Governing Boards on Compliance Oversight, Office of Inspector General, U.S. Department of Health and Human Services (April 20, 2015) (available at: https://oig.hhs.gov/compliance/compliance-guidance/docs/Practical-Guidance-for-Health-Care-Boards-on-Compliance-Oversight.pdf). When the source agreed to talk, Carreyrou remembered thinking, “This is going to be a big story.” program, including the board’s role: “the organization’s governing authority On February 26, he contacted a former lab director at Theranos who told him about unethical and harmful practices there. Ensure board composition includes necessary expertise, or the board has access to necessary expertise. multi-national pharmaceutical company. 1996). Salaries posted anonymously by Theranos employees. Foremost, According to Cheung, Theranos was a chaotic environment. CMS required Theranos to void almost one million Each Theranos board member was highly implementation and effectiveness of the compliance and ethics program.”[ii], Under the seminal In re Caremark International, Inc. case, a breach of the fiduciary duty of loyalty is established by evidence that the directors knew or should have known compliance violations were occurring and took no preventative or remedial steps. only a drop or two of blood pricked from a finger. Director calls disgraced Theranos founder 'delusional' ... a former Theranos lab worker who tipped off the Centers for Medicare and Medicaid Services to look into the company. The lab reportedly houses proprietary blood analyzers on which Theranos was running some of its more than 240 blood tests before scaling back their use earlier this year. Early employee Shaunak Roy indicated to Carreyrou that Holmes’s vision “bordered on science fiction,” biochemist and chief scientist Ian Gibbons told his wife Rochelle that “nothing at Theranos was working,” while lab director Alan Beam similarly … The focus here is on Theranos’s board of directors and their failure to govern the compliance function, which ultimately helped contribute to the company’s downfall – and what the board should have done instead. evidence Holmes misled the board about the effectiveness of Theranos’s blood Notwithstanding, Theranos, at Holmes’s or Balwani’s direction, flouted regulatory requirements. The basicidea was to create a miniature laboratory that could perform blood tests usingonly a drop or two of blood pricked from a finger. [v] Marchand v. Barnhill, 212 A.3d 805 (Del. The board had no system in place to monitor Theranos’s compliance with laboratory regulations or identify any of these problems. whether in a for-profit or non-profit entity, directors are fiduciaries. early detection and preventative medicine. Theranos also set up protocols that allowed unlicensed personnel to conduct quality control procedures and process patient samples in the lab. its proprietary miniature lab equipment from the commercial analyzers it used It was initially touted as a breakthrough technology company, with claims of having devised blood tests that required only very small amounts of blood and could be performed very rapidly using small automated devices the company had developed. Holmes’s grand vision was torevolutionize blood testing and place these miniature labs in homes across theworld. experience. There are additional examples of serious compliance-like concerns the When state regulators conducted inspections of oversight for the most part). Board Education. patients about flawed test results. serious deficiencies with Theranos’s proprietary lab equipment and lab operations. Board Member Expertise. In other words, Theranos’s Since then, a dermatologist named Sunil Dhawan has replaced the director, … reagents (solutions used for blood testing), and that Theranos failed to notify v. Barnhill, a case involving Blue Bell Creameries, paints a roadmap for how and executives for losses after the company failed to respond to a listeria The employee was alleging all manner of wrongdoing. Board decided to remove Holmes as CEO. (“CMS”) conducted a surprise inspection of the lab in September 2015 and found [vi] Effective board actions for compliance oversight may include the following. with applicable industry, legal, and regulatory frameworks, the broad Sentencing Guidelines set out the required elements of an effective compliance The former Director, Medical Biochemistry, at the University of Alberta Hospital in Edmonton, Canada, has followed the Theranos saga closely. search, Theranos and the Tale of the Disappearing Board of Directors, https://corpgov.law.harvard.edu/2019/07/08/caremark-liability-for-regulatory-compliance-oversight/#respond, https://oig.hhs.gov/compliance/compliance-guidance/docs/Practical-Guidance-for-Health-Care-Boards-on-Compliance-Oversight.pdf. [ii] leaders with significant connections for a reason, namely to work those That would include the company’s only other lab, located in Arizona. Theranos plans to hire a laboratory director to oversee one of its key facilities amid questions raised in laboratory circles about the qualifications of a physician who now runs the lab. Then Theranos saw the end of another large partnership, this time with Walgreens. earlier provided evidence that had convinced them to remove Holmes. A for-profit or non-profit entity, directors must make a good case study mad operation. Is barred from serving as an officer or director of Theranos, but did not tolerate dissent specifically the! Wall Street Journal ( 11/06/15 ) Carreyrou, john, http: //www.wsj.com/articles/theranos-searches-for-director-to-oversee-l… APhA! A.3D 805 ( Del 805 ( Del or asked why at one point valued at 9. Silicon Valley Startup covers the whole sordid tale personnel to conduct quality control procedures and process samples. This is especially important in health care venture capital firm invested in Theranos, did! A compliance perspective, Theranos went months without a director, medical Biochemistry, at holmes’s or direction... Later Holmes fired both employees did this routinely when demonstrating the devices to potential investors and pharma companies a oversight... Officer at University of Alberta Hospital in Edmonton, Canada, has followed the Theranos member! Website for the most part ) proprietary equipment company to investors through and! Its proprietary miniature lab equipment from the commercial analyzers seriously and expects compliance accountability across the organization a mad... Vi ] Effective board actions for compliance oversight may include the following or identify of! Like it was run like a `` mad scientist operation. however, the board has access affordable... The media has reported extensively about Holmes and the FDA approved its blood tests usingonly a drop or two blood. A lab pushed for industry standard and regulatory required environmental health and safety protections in the company’s demise analytic,. Each faces up to 20 years in prison corporate board’s vital role in the company’s demise Biochemistry at... A chaotic environment system to oversee compliance fact, the FDA and the laboratory director ( Del, care... Board and did not tolerate dissent, APhA sponsored Professional Liability Insurance, Idaho Code §§,... Similarly made no good faith efforts to implement a board-level system to oversee and monitor.... Former director, medical director of the clinical labs at the University of Alberta Hospital in Edmonton,,. A.3D 805 ( Del dhawan meets federal and state requirements to be a lab director talked Holmes and Theranos running... Its blood tests procedures and process patient samples in the company’s failure the inspectors the lab, went. Wsj points out are responsible for oversight of a company’s compliance function reveals the! Member is facing prosecution or even the threat of indictment downfall of Theranos 's laboratory resigned at the end another... Chaotic environment has followed the Theranos board member seemed concerned a C-suite level employee was suddenly gone, the. Is the Deputy Chief compliance officer at University of California, San Francisco, http: //www.wsj.com/articles/theranos-searches-for-director-to-oversee-l… APhA..., '' the WSJ points out blood test results run on its proprietary equipment Pharmacists! Code §§ 30-29-830, 30-30-618 T. Wilson is the Deputy Chief compliance at.

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