Theranos is closing its labs and wellness centers, CEO Elizabeth Holmes announced today in a post on the company blog. And this isn’t a temporary closure: the “approximately” 340 employees running them are out of a job.
“After many months spent assessing our strengths and addressing our weaknesses, we have moved to structure our company around the model best aligned with our core values and mission,” Holmes wrote.
Sanctions were announced by the Centers for Medicare and Medicaid Services after the company’s blood testing methods were found to be lacking in accuracy. Among other things, the sanctions prohibited Holmes herself from owning, operating, or directing a lab, and removed the possibility of funding from Medicare/Medicaid systems. This would greatly complicate and limit the labs and testing side of the business.
Theranos announced in August that it was appealing the sanctions, but that doesn’t seem to have panned out yet — although the CMS has not enforced them on the timeline set out in July. We contacted Theranos for more details on the prospect of operating under the sanctions and when the locations will be shut down, but a representative declined to comment beyond what Holmes wrote in the post.
The company says it will “return our undivided attention to our miniLab platform,” which seems like a good idea.