Theranos Investors: Uh, Can We Have Our $100 Million Back Now?

By
Photo: Lisa Lake/Getty Images

The hits just keep on coming for Elizabeth Holmes and Theranos. Following major layoffs and lab closures last week, yesterday news broke that one of the company’s major backers, Partner Fund Management LP, is suing the blood-testing company and Holmes for nearly $100 million after both reportedly lied about the company’s technology to secure funding. According to a letter sent to The Wall Street Journal, “Theranos, its founder Elizabeth Holmes and a former executive deceived the hedge fund by claiming it had developed ‘proprietary technologies that worked,’ and was close to getting regulatory approvals.” And as anybody who has kept up with Theranos’s fall from Silicon Valley grace will tell you, that technology never materialized. Theranos, for its part, denies the allegations and plans to fight them “vigorously.”

Last week, after shuttering all of its clinical labs and Theranos Wellness Centers, Holmes announced the company is refocusing its efforts on its miniLab platform. The miniLab is small blood-testing device that looks like “a computer printer” and can reportedly test for up to 40 diseases in a very small sample of blood. (The device has yet to be green-lit by regulators and already has skeptics.) Earlier this year, Holmes was banned by U.S. regulators with the Centers for Medicare and Medicaid Services from operating a medical lab for at least the next two years. (Holmes is currently appealing this ban.) Also, Forbes recently re-estimated her once multi-billion net worth to $0, so that’s got to hurt.