Arizona played a role in the Elizabeth Holmes saga
When you see Elizabeth Holmes’ name in headlines and stories, it’s often preceded by the word “disgraced.”
It wasn’t long ago that Holmes was described in starkly different terms: brilliant, rich, pioneering. It’s a headspinning fall from grace, a riches-torags story compelling enough that Hulu is making a scripted series about the whole affair starring Amanda Seyfried. And Apple has announced a film version starring Jennifer Lawrence as Holmes.
The saga dragged the fake-it-tillyou-make-it ethos of Silicon Valley startups under the microscope.
It was also fodder for Alex Gibney’s 2019 documentary “The Inventor: Out for Blood in Silicon Valley,” available on HBO Max. It’s the kind of story with tentacles that reach into aspects of health care, startup culture and how we view wealth and its acquisition.
And Arizona played a part in it. So did the Arizona news media reporting on it. Media coverage, in fact, was a driving force in bringing the real story to light.
Holmes is on trial after being charged with 11 counts of fraud, allegedly deceiving patients and investors about Theranos Inc., the startup she founded in 2003. Her former business and romantic partner Ramesh “Sunny” Balwani has also been charged; his trial is scheduled for 2022. Promises that the company’s blood-testing machines could perform an array of tests using only drops of blood proved unfounded, prosecutors say.
‘The Inventor’ serves as both a primer and a reminder
A look back at “The Inventor” serves as both a useful primer on the company’s history — Gibney has access to Holmes throughout the film — and a reminder that Arizona served as a test market for both Theranos’ products and its promises.
Part of what makes the story so interesting is Holmes herself. She dropped out of Stanford University to start the company.
Dressed in black turtlenecks like Steve Jobs (but not in jeans, which were also part of Jobs’ signature look, she notes in the film, laughing), Holmes both fits the cliche of the hard-charging tech executive and also blows it up — she was a woman demanding entry into a boys’ club of boys’ clubs. And she got there, becoming a billionaire (the company was valued at more than $9 billion in 2015).
But how? And at what cost?
At the cost of her reputation and personal fortune, for one thing. At the cost of the $4.65 million fraud settlement Theranos agreed to pay Arizona consumers in 2017. And possibly 20 years of her freedom if convicted. (Holmes has pleaded not guilty.)
“The Inventor” lays out Holmes’ claims for Theranos and its eventual failure, a methodical takedown of a business built classically on overpromising and underdelivering. The first half is devoted to how Holmes built Theranos, and how she attracted a heavy-hitting list of investors such as Rupert Murdoch, as well as board members including Henry Kissinger and and George Schultz.
It also chronicles the claims Holmes made for what would have been revolutionary technology — if it had worked. It didn’t, the how of which Gibney also details.
Media plays a big part in the film and in the story overall. Roger Parloff wrote a widely read, positive profile of Holmes and the company for Fortune in 2014. He’s interviewed in the film and rightfully angry, seemingly moved almost to tears at one point. (Parloff later wrote a follow-up, “How Theranos Misled Me.”)
But it was Wall Street Journal reporter John Carreyrou’s 2015 story that broke the news of Theranos’ failings (the film is considered a companion piece to his book “Bad Blood”).
Arizona comes into play in the second half of the film. Theranos operated retail locations inside Walgreens stores in Phoenix in 2013, making it the proving ground for the supposedly new technology.
The film shows Holmes testifying before gushing legislators, who would pass a bill signed by Gov. Doug Ducey that allowed people to order tests without a doctor’s orders. We see Fox 10’s John Hook and Kari Lake present a story about Theranos, and the station’s Linda Williams offer a cautionary note that some medical professionals were skeptical.
National media broke the story; local media covered it, too
Outside the film, Theranos got plenty of coverage from local media. As early as 2015,The Arizona Republic was writing stories about the company not always meeting lab regulations. That story prompted a published retort from Holmes in the form of a letter to the editor, defending Theranos’ transparency and performance.
Prosecutors would disagree. And an editor’s note said the newspaper stood by its story.
What unfolds in “The Inventor” is a great story — great in the media sense that it’s interesting, complex, filled with compelling people promising the moon and failing to deliver. Not so great if you were one of the people placing your faith in Theranos for accurate blood work — or if you worked for the company.
The story has moved into a different phase. Theranos no longer exists. Juries will decide the fate of Holmes and Balwani. The media will cover it; who knows, maybe Gibney will shoot a coda for his film.
But it remains a story, one that began as a triumph, and ends, yes, in disgrace.