Theranos Responds to Skeptics, Industry as Platform Remains Under Wraps (Update)

Theranos Responds to Skeptics, Industry as Platform Remains Under Wraps (Update)

Palo Alto, CA-based Theranos continues to make waves in the IVD industry. The most recent event is the release of a critical Wall Street Journal report including interviews with former employees. The Silicon Valley company has released a statement in response to claims in the report. Kalorama Information’s profile of the potentially disruptive clinical testing service company can be read here.

The extent of the Theranos platform’s capabilities remains uncertain; a former employee claimed in the WSJ report that only 15 of the company’s offered tests were run using fingerstick samples and/or on the proprietary platform. The remaining nearly 200 tests on the company’s test menu were reportedly run in a traditional manner. In its statement, Theranos mentions its submission of almost 130 tests for FDA review; its fingerstick herpes simplex virus-1 (HSV-1) test run on its proprietary technology (‘Edison’) was previously reviewed and approved by the FDA. Kalorama Information eagerly awaits the results of the FDA review of Theranos’ other tests. The company’s submission of its laboratory developed tests (LDTs) to the FDA is a largely unprecedented move; FDA approval is required only of medical devices, not test services.

Articles in Fortune and Fox News have also critiqued the company’s offering and valuation. The Fortune story featured Jean-Louis Gassée, former head of Apple engineering in the late ’80s, who wrote about his personal experience; comparing his results at a Stanford Lab to several visits to Theranos at Walgreens, with different results. Theranos defended the charges on its website. Among the list of comments there, "Over 30,000 people have rated the experience we provide via direct feedback. We average more than 4.8 out of 5 stars."

(UPDATE: Theranos is limiting its fingerstick technology to only its FDA-approved HSV-1 test pending FDA review of its other submissions. Remaining menu tests are being run on third-party, FDA-approved analyzers. )

In a recent report(http://www.kaloramainformation.com/Clinical-Laboratory-Services-9305161/), Kalorama Information identified the clinical lab services market at over $100BN. This means there is a large market potentially for lab services, though much of the market is dominated by Quest and Lab Corp.