Billionaire Elizabeth Holmes, founder and chief executive officer of Theranos Inc., reacts during a Bloomberg Television interview at the Vanity Fair 2015 New Establishment Sumit. David Paul Morris/Bloomberg

A few days ago, the chief executive of one of the hottest and most secretive health care companies was named one of "five visionary tech entrepreneurs who are changing the world" by the New York Times. Elizabeth Holmes, the head of blood testing company Theranos, has also appeared on the cover of Fortune, was the subject of an admiring profile in the New Yorker, and was this month splashed on the cover of Inc. with the understated headline "The Next Steve Jobs."

A deeply reported investigative story by the Wall Street Journal on Thursday revealed that despite its $9 billion valuation and its board made up of political heavyweights -- including Henry Kissinger and former secretary of state George Shultz -- Theranos' actual revolutionary technology may be falling flat. According to the story, Theranos' novel system for blood analysis, called Edison, was only being used to analyze a small fraction of blood samples at the end of last year and some employees doubted its accuracy. Despite all the hype and mystery around the technology, the company was, for the most part, relying on existing technology made by other firms. The story also reports that the company cherrypicked which data to report to regulators, a major no-no for any company trying to prove that its medical technology actually works.

The company promptly hit back: "Today’s Wall Street Journal story about Theranos is factually and scientifically erroneous and grounded in baseless assertions by inexperienced and disgruntled former employees and industry incumbents,"  Theranos said in a statement. "The sources relied on in the article today were never in a position to understand Theranos’ technology and know nothing about the processes currently employed by the company. We are disappointed that, in an effort to make its story more dramatic, this reporter relied only on the views of four 'anonymous' disgruntled former employees, competitors and their allies, instead of reaching out to many of the scientific, health care and business leaders who have actually seen, tested, used and examined our breakthrough technologies."

But there's another, very important group of people, who are arguably also "never in a position to understand Theranos' technology": its esteemed board of directors.

Theranos unusual board makeup only seemed to help it become a media darling. Many high-flying biomedical startups try to populate their boards with expertise: Nobel laureates, venture capitalists, hospital heads, and PhDs. Theranos' board includes a retired U.S. Navy admiral, three former U.S. cabinet secretaries, a U.S. Marine Corps general, and two former senators, among others. The members who seem most likely to engage with the complex technical material and to evaluate the cutting-edge claims the company was making would be William Foege, an epidemiologist who headed the Centers for Disease Control and Prevention, and former senator Bill Frist, who is a surgeon.

That may not be as much of an asset as it seems.

George Church, a Harvard Medical School scientist who has invented many new genome technologies and been involved in the inception and leadership of dozens of companies noted that the board was an unusual cast of characters, without much real medical expertise.

"Usually such deficits in the board of directors would be offset by an equally stellar scientific advisory board and/or medical advisory board," Church said in an e-mail. "I don't see either for Theranos."

Eric Lakin, a senior analyst at the consulting firm DeciBio, said that for him, the first red flag about the company was in the summer of 2014, when he went to get the hyped blood test. Instead of a finger-prick, which is what the company has long advertised as its major selling point -- needing to draw less blood -- he got a typical venous blood draw.

Lakin's own review of the board members suggested that the company was putting people on the board with political connections that might help change policies rather than vet the technology. Indeed, Senator John McCain, who is not on the board, praised the company to the Post this summer and said he had helped get a state law changed so that consumers in Arizona could seek the blood tests without the oversight of a physician.

"I don’t think there’s any clear justification for having that many [former] government officials on the board of a science company," Lakin said.

Several scientists and physicians asked by the Post this summer about the technology were more puzzled and skeptical than excited about the technology, but given the lack of concrete information about how it worked were hesitant to speak publicly. The secrecy of the company appears to have been an effective way to keep critiques much quieter than the excitement about the test's potential.

A few have gone public. John Ioannidis, a physician at Stanford University who has become famous for his work revealing how many major published medical findings don't hold up, criticized Theranos' "stealth research" approach in the Journal of the American Medical Association in February.

This summer, he told the Post that Theranos getting FDA clearance for a single blood test was a good sign.

"However, I still believe that it is important also to have the full information available in the scientific community through peer-reviewed publications on methods and results, with access of other scientists to the raw data and protocols."

"Their claims of superiority over current systems and practices are speculative, at best," Eleftherios Diamandis, of Mount Sinai Hospital in Toronto, wrote in a paper published in the journal Clinical Chemistry and Laboratory Medicine.  "An open discussion of the merits and shortcomings ... should take place in the scientific literature and other public forums, so that the benefits and harms are better understood by the public."

 

In a way, what Theranos is doing is simply following the time-tested Silicon Valley playbook: the company is ginning up a ton of excitement and funding, talking about disrupting a stodgy old industry, and shrouding their product in secrecy. That approach fails to acknowledge that consumer and technology products are fundamentally different from medicine. New innovations can't simply surf on excitement when people's lives are at stake.