This story has been updated.
In mid-September, the embattled upstart blood testing company Theranos received two inspection forms from the Food and Drug Administration -- a notice that inspectors had discovered objectionable conditions that they believed were in violation of federal law.
The documents do little to clear up the many questions swirling around the celebrated Silicon Valley startup that sought to revolutionize blood testing by doing it for cheaper, on smaller amounts of blood that required just a fingerprick. After a Wall Street Journal investigative report, questions about the how the tests work and whether the proprietary technology that has been hyped as a breakthrough is ready for prime time have become urgent. Of more than 200 tests the company does, only a single blood test uses the technology that drew comparisons to Apple and made it the subject of cover stories in Forbes, Fortune, and Inc., and a lengthy profile in the New Yorker.
The seriousness of the two FDA reports are hard to assess because large sections are blacked out. But the reports of two facilities, inspected over a three-week period at the end of August and beginning of September, raise new questions about practices at the company. They show federal inspectors deemed Theranos had misclassified its Nanotainer blood collection device as a low-risk medical device, had kept inadequate records, not done quality audits, and not handled consumer complaints correctly.
The report is not a final determination that the company violated the law, but contains 14 "observations," which are made "when in the investigator’s judgement, conditions or practices observed would indicate that any food, drug, device or cosmetic has been adulterated or is being prepared, packed, or held under conditions whereby it may become adulterated or rendered injurious to health," according to a Q&A on the FDA website.
The observations include:
- Theranos misclassified its Nanotainer blood collection devices as "Class I exempt," when they that should have been classified as a risky, Class II device that undergoes more regulatory scrutiny. "You are currently shipping this uncleared medical device in interstate commerce, between California, Arizona and Pennsylvania," the report states.
- A lack of design validation to "ensure the device conforms to defined user needs and intended uses."
- Complaints about possible device failure that weren't being investigated or documented.
- Inadequate documentation and record-keeping.
David Lim, president of Regulatory Doctor, a consulting firm that advises numerous companies on how to comply with FDA rules and regulation, said in an e-mail that two of the observations, regarding undocumented software validation and corrective actions "raises some concerns that the firm may have systemic quality problems potentially leading to some concerns on accuracy and precision of their test data."
In a lengthy statement, the company emphasized that it worked with the FDA and believes that it has made the appropriate fixes.
"We believe that we addressed and corrected all the observations at the time of, or within a week of, the inspection and have submitted documents to FDA that say so, including extensive documentation, as well as outlining our path to the whole Quality System Regulation transition going forward," the statement said. "In our discussions with FDA, we determined that in order to do so, it was appropriate to temporarily pause use of the Nanotainer tubes for all tests except our cleared HSV-1 test as we cut over to FDA quality systems, and wait for clearance."
But as the intense spotlight on the company has continued, some of the well-known health care names that have been associated with the company have distanced themselves from the company. Pfizer and GlaxoSmithKline were reported to use the company's tests when they were conducting clinical trials, but both companies characterized that relationship as limited.
"Pfizer’s done only very limited historical exploratory work with Theranos through a few pilot projects and we do not have any current/active projects with them. The extent of our work included only limited evaluations of their technology," Pfizer spokesman Dean Mastrojohn wrote in an e-mail.
GlaxoSmithKline spokeswoman Mary Anne Rhyne said in an e-mail that the company had not worked with Theranos for at least two years.
Cleveland Clinic spokeswoman, Eileen Sheil, said in an e-mail its collaboration with the company is in very early stages and they have not used Theranos' technology.
The Wall Street Journal last week reported that officials from Walgreens, which has partnered with Theranos in 41 stores in Arizona and California, wouldn't open more blood-testing centers until they got more answers from the company.
First person experiences with the testing have also begun to emerge, showing that the marketing for the company was not the same as the consumer experience.
"Rather than 'one tiny drop changing everything,' it was three vials of blood and two days before I received my lab results," wrote Eric Lakin, a consultant with DeciBio who had the test done.
Venture capitalist and former Apple executive, Jean-Louis Gassée, recounted his personal experience with the testing this June on Monday Note, finding results discordant with testing done at Stanford.
Gassée has a mutation in the gene JAK2 that means he is at risk for blood clots. After getting his blood tested at Stanford one day this summer, he thought it might be interesting to compare it to the exciting new company that derived much of its $9 billion valuation from its potential to reshape medicine.
Here's what the two tests showed, according to the article:
— Platelets: 320, no concerns, come back in two or three months
— Hematocrit: 41.1, ditto
Same day, 1 hour later, Theranos:
— Platelets: 430, given my condition, that’s high
— Hematocrit: 44.1, a passing grade, but uncomfortably close to the 45% limit"
"The differences are disquieting. Theranos’ numbers are an alarming 34% and 7% higher, respectively, than Stanford’s. Whom should I believe?" Gassée wrote.
He got the test done again a day later at Theranos, and one day later at Stanford. The Theranos numbers both dropped, and were still very different from the ones at Stanford.
"The Theranos numbers have two problems: They deviate significantly from the Stanford numbers and, more important, they deviate from themselves over a 24 hour period," Gassée wrote. "Glucose concentration can vary hourly, not so platelets or hematocrit."
The company has stated that it has sent more than 120 pre-submissions to the Food and Drug Administration to get federal clearance for its tests, evidence that each is accurate and evidence-based. But if it is to gain the public trust of the medical and scientific community as well as patients, it may need to be even more transparent about the data underlying its tests.
Update: The company said in a statement it is evaluating the best data and studies to publish.
"At this point, we are interested in potentially publishing information regarding the performance of tests on our systems compared to reference methods so people can see the performance of our devices," the statement said.
Brady Dennis contributed to this story.