Arizona Makes Theranos Pay Following the Public Embarrassment of Its Governor
Embattled former blood-testing startup
For a company that is believed to have raised $800 million, the
$4.65 million settlement
with Arizona's Attorney General Mark Brnovich might seem like a drop in the bucket. But those funds have
dwindled to just $200 million, and a
$140 million lawsuit
from its former partner
Theranos social and political capital is also basically worthless now. Founder and CEO
One of the high-profile
by Theranos bullshit was Arizona Governor
In Ducey, Holmes saw an easy mark for her mission to remove barriers to entry in the marketplace and buttered up Arizona lawmakers with talk of creating "free-market competition to drive prices down and increase transparency." Specifically, she wanted to remove requirements for a doctor's order to get a blood test. Despite the protestations from the Arizona Medical Association, the bill that removed those requirements easily passed. Arizona House Speaker David Gowan reportedly told Holmes when she first came to the state to lobby politicians, "You're talking to free-market-minded people here, so you're talking in the right tone." Governor Ducey championed the passage of the bill as one step in his plan destroy regulations.
Now, Ducey has to live with the fact that the absence of regulation put his citizens in danger . Today, Arizona pulled every drop of blood out of Theranos' corpse that it could. Attorney General Brnovich told Bloomberg "They said approximately 10½ percent were inaccurate, and it didn't matter." He explained that he wanted a refund for all customers to "send a message not only to Theranos but to other companies that if they are going to violate Arizona consumer protection law we're going to go after them, we're going to hit them hard."
Among the other pending legal troubles that Theranos faces are civil suits with individuals like an Arizona resident who claims that the company's faulty tests resulted in his heart problems going undetected and he subsequently had a cardiac arrest.
With a seriously
empty bank account
for Holmes, Theranos is still
with the development of a new device called miniLab. Holmes described it as "the beginning of the next phase of the company." The device will allegedly test blood.
[ Bloomberg ]