Theranos (2015): CMS Form 2567 and sanctions

A device claim and a retail partnership Theranos raised capital on the promise of decentralized, low-volume blood testing. A 2013 partnership with Walgreens put collection sites in stores and made the claim a consumer-facing fact, not only a Silicon Valley pitch. Internal and later public records showed that many tests offered to patients were run on third-party analyzers, sometimes after diluting small samples, while the company’s own devices handled a narrower set. That gap is the factual core of the later fraud cases.

Carreyrou’s October 2015 article, followed by more Journal reporting, forced the company into a defensive public posture. CMS inspected the Newark, California laboratory and in 2016 imposed sanctions, including a ban on Holmes’s operating labs for a period. The FDA and CMS files, plus later SEC charges in March 2018, moved the story from a magazine dispute into the enforcement docket. The company dissolved in 2018 as the criminal case was prepared.

Holmes’s trial (2021–2022) focused on what investors were told about technology, pharmaceutical-company validation, and the Department of Defense. The jury convicted on investor-fraud counts and acquitted or hung on others, including patient-related wire-fraud counts. Balwani was tried separately in 2022 and convicted on all counts he faced, including investor and patient-related fraud. The split outcomes are part of the public record and are often flattened in casual retellings.