The verdict was eagerly awaited. Elizabeth Holmes, the 38-year-old billionaire who deceived Silicon Valley by promising a “revolution” in blood testing, will serve 11 years and 3 months in prison. Sentenced in January for fraud, she had demanded a new trial due to the reversal of a key witness, but the request was refused. Prosecutors held her responsible for fraud involving more than $800 million, but Judge Davila said on Friday that she had sufficient evidence to show that at least ten investors were victims of scams totaling 121.1 millions of dollars.
The founder of the start-up Theranos risked up to 20 years in prison and a fine of 3 million dollars. “I am devastated by my failings. Every day for the past few years, I have felt deep pain for what people have gone through because I failed,” she said, in tears, in court, just before the judge does not pronounce his sentence. She apologized to Theranos employees and to the patients who trusted her. “I gave everything I had to build and save our business. I regret my failures with every cell in my body,” she added.
She is at the heart of a saga that mixes dollars, blood, ambition and trickery. She founded Theranos in 2003, when she was only 19 years old. Its goal: to offer blood tests that are faster, more complete – more than 200 analyzes from a single droplet – and cheaper than in traditional laboratories.
She promised the moon to investors and many saw nothing but fire: Elizabeth Theranos has confidence, a certain charisma and obviously arguments. It deceived its partners by raising more than 945 million dollars, while the tests in question never had the reliability promised.
In 2015, Forbes had valued her fortune at $4.5 billion and made her the nation’s youngest self-made billionaire. But for Elizabeth Holmes, the nightmare arrives in June 2018, when she is charged. The coronavirus pandemic then caused her trial to be postponed several times and in July 2021 she welcomed her first child with her husband Billy Evans, heir to the Evans hotel group. She is currently expecting a second baby. Again, her detractors suspect her of seeking to pity the jury and smooth her image in public opinion.
Last week, more than 140 letters in his favor arrived at the court in San Jose, California. One is from Democratic Senator Cory Booker. “I still think she holds out hope that she can contribute to the lives of others and that she can, despite her mistakes, make the world a better place,” he wrote. “I can’t tell you how many founders and investors I’ve spoken to sympathize with Elizabeth and think Theranos’ mistakes weren’t that different from any other Silicon Valley startup’s” , notes for his part, Jeremy Carr, executive and active investor in tech.
John Carreyrou’s investigation
Who really is this woman, always elegant and who rarely separates from her smile, even in the most difficult conditions? Diabolical, manipulative, scammer and rudely malignant, only looking to collect money by fooling investors? Or a naive woman who believed in her dreams and ideals and dared to take risks? It is this last image that the lawyers have sought to convey. She was allegedly in the grip of Ramesh “Sunny” Balwani, a former Theranos chief operating officer and lover of Elizabeth Holmes for several months, tried to press her defense. Found guilty of twelve counts, Sunny Balwani will receive his sentence on December 7.
Elizabeth Holmes studied chemistry at Stanford University. In 2003, she founded a start-up, Real-Time Cures, in Palo Alto, which offers medical monitoring by cell phone. Real-Time Cures will become Theranos and Elizabeth Holmes decides to focus on blood tests, touched by the unexpected death of an uncle whose illness had not been detected in time. Because she is afraid of needles, she is considering tests allowing early detection of pathologies from a single droplet.
But from October 2015, things went wrong for her. The Franco-American journalist John Carreyrou publishes a first in-depth investigation into the Wall Street Journal, which questions the reliability of its technology and methods. False contracts, approximate results, false diagnoses: Theranos is far from proposing a “revolution”. Edison, his tool supposed to allow ultra-fast diagnostics? It doesn’t really work.
John Carreyrou does not let go. In 2018, he published Bad Blood: Secrets and Lies in a Silicon Valley Startup. For Elizabeth Holmes, it’s the beginning of the end. Its pharmaceutical and medical partners begin to doubt and turn their backs on it. In March 2018, the young entrepreneur accused of fraud by the American stock market policeman agreed to pay a fine of 500,000 dollars in exchange for the abandonment of part of the proceedings against her. She will step down as CEO of Theranos three months later. And it was in September of the same year that Theranos officially disappeared.
Among the witnesses who followed one another at his trial, which lasted fifteen weeks, were patients who were victims of false diagnoses. A man, for example, was wrongly declared HIV-positive.
John Carreyrou’s book will be brought to the cinema. And Hulu has produced an eight-part series, The Dropout, which is inspired by the Theranos saga. Finally, HBO is producing a documentary, The Inventor: Out for Blood in Silicon Valley. Elizabeth Holmes continues to fascinate. But now she has until April 27 to start her sentence, said judge Edward Davila.