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Bottom line? Don't drop out of Stanford... - Trevmiesterj - 10-06-2016

The incredible rise and fall of Theranos and founder Elizabeth Holmes. 

http://mashable.com/2016/10/05/theranos-hundreds-of-jobs-lost/#Y_9sLJHdCaqS



Re: Bottom line? Don't drop out of Stanford... - BostonCard - 10-06-2016

There is a fine line between merely overhyped and an outright scam.  I'm not sure which side of the line Theranos lies.

Re: Bottom line? Don't drop out of Stanford... - 2006alum - 10-06-2016

(10-06-2016, 12:04 PM)Trevmiesterj link Wrote:The incredible rise and fall of Theranos and founder Elizabeth Holmes. 

http://mashable.com/2016/10/05/theranos-hundreds-of-jobs-lost/#Y_9sLJHdCaqS

I think the bottom line is not to be a fraudulent megalomaniac. If you are one, I'd very much prefer that you drop out than graduate and tarnish our alma mater's name even further!

Re: Bottom line? Don't drop out of Stanford... - Trevmiesterj - 10-06-2016

Quote:I think the bottom line is not to be a fraudulent megalomaniac. If you are one, I'd very much prefer that you drop out than graduate and tarnish our alma mater's name even further!

I never saw Holmes that way, but evidence (and opinion) seems to have brushed her with that stroke.  It is a shame really because the idea and promise of this technology was quite intriguing.  I remember sharing it with many friends never really assuming it was pie in the sky.



Re: Bottom line? Don't drop out of Stanford... - CrazedZooChimp - 10-06-2016

(10-06-2016, 01:14 PM)Trevmiesterj link Wrote:
Quote:I think the bottom line is not to be a fraudulent megalomaniac. If you are one, I'd very much prefer that you drop out than graduate and tarnish our alma mater's name even further!

I never saw Holmes that way, but evidence (and opinion) seems to have brushed her with that stroke.  It is a shame really because the idea and promise of this technology was quite intriguing.  I remember sharing it with many friends never really assuming it was pie in the sky.

She modeled herself after Steve Jobs, so she must have been a bit of an arrogant jerk (or at least dreamed of being an arrogant jerk).

Re: Bottom line? Don't drop out of Stanford... - 82lsju - 10-06-2016

for those who missed it this is a pretty complete article on the Theranos situation

http://www.vanityfair.com/news/2016/09/elizabeth-holmes-theranos-exclusive

Re: Bottom line? Don't drop out of Stanford... - 2006alum - 10-06-2016

(10-06-2016, 01:14 PM)Trevmiesterj link Wrote:
Quote:I think the bottom line is not to be a fraudulent megalomaniac. If you are one, I'd very much prefer that you drop out than graduate and tarnish our alma mater's name even further!

I never saw Holmes that way, but evidence (and opinion) seems to have brushed her with that stroke.  It is a shame really because the idea and promise of this technology was quite intriguing.  I remember sharing it with many friends never really assuming it was pie in the sky.

I was always skeptical that a college dropout could invent something that several blood testing companies that devote hundreds of millions of dollars to R&D could not do. My Silicon Valley friends in the venture community were always extremely wary of her (and indeed, as Vanity Fair notes, almost none of the investment in Theranos was Valley money) because of how secretive and too-good-to-be-true it seemed. Given the insane things that venture money chases, it was always very telling that little money was directed there.

Re: Bottom line? Don't drop out of Stanford... - dabigv13 - 10-06-2016

https://mobile.twitter.com/daveweigel/status/783836486210813953?ref_src=twsrc%5Etfw

I liked that bit.

I only read about this company a few years ago once negative stuff already started coming out, but it always struck me as a pretty ridiculous startup idea.

Re: Bottom line? Don't drop out of Stanford... - Mick - 10-06-2016

(10-06-2016, 02:49 PM)2006alum link Wrote:I was always skeptical that a college dropout could invent something that several blood testing companies that devote hundreds of millions of dollars to R&D could not do. My Silicon Valley friends in the venture community were always extremely wary of her (and indeed, as Vanity Fair notes, almost none of the investment in Theranos was Valley money) because of how secretive and too-good-to-be-true it seemed. Given the insane things that venture money chases, it was always very telling that little money was directed there.


I wasn't skeptical enough.  I worked for a company like that a couple of decades ago.  Promised an amazing technology...really an extrapolation of existing, incompatible technologies that, somehow, they were going to integrate seamlessly. 

I was brought on board to find $5 million in venture capital.  I went to some of the A-List VCs to seek a first round of funding, had auditions with two of them.  One sent the very, very tough chairman of a multibillion dollar company to meet with me (COO), the CEO -- who hadn't gone to college and had delusions of grandeur, but had founded one moderately successful company -- and our head of sales.  He listened to our pitch, asked a dozen challenging questions, stood up and said, "Thanks gentlemen, I've seen all I need to see.  Mick, can you walk me out to my car?"  I walked him out to his car, he said "Look, it's a very good idea, and it's a very big market.  But if the big guys want to get into that market, it would cost less than 2% of their R&D budget.  And your CEO told me 'they'll never think of it.'  Trust me, they will think of it.  And I wouldn't hire your head of sales to be a line sales guy at my company.  My advice is for you to get out as soon as you can."  That meeting was my second inkling that it wasn't going to go well, as was the fact that none of the Silicon Valley funds would talk to us.  The company ended up getting $5 million from a Swiss fund, and I resigned the day before they did the due diligence.  They burned through about $16 million in venture capital, never really went anywhere, though they did have an interesting exit and at least one investor made a lot of money, but it never really got off the ground.

Re: Bottom line? Don't drop out of Stanford... - BostonCard - 10-06-2016

(10-06-2016, 02:49 PM)2006alum link Wrote:I was always skeptical that a college dropout could invent something that several blood testing companies that devote hundreds of millions of dollars to R&D could not do. My Silicon Valley friends in the venture community were always extremely wary of her (and indeed, as Vanity Fair notes, almost none of the investment in Theranos was Valley money) because of how secretive and too-good-to-be-true it seemed. Given the insane things that venture money chases, it was always very telling that little money was directed there.

One could also have been skeptical that a college dropout could invent something (an easy to use personal computer) that several enterprise computing companies that devote hundreds of millions of dollars to R&D could not do.  But Steve Jobs did.
One could also have been skeptical that a college dropout could invent something (an operating system for personal computer) that several enterprise computing companies that devote hundreds of millions of dollars to R&D could not do.  But Bill Gates did.
One could also have been skeptical that a college dropout could invent something (a direct sales model for personal computers) that several computer companies that devote hundreds of millions of dollars to R&D could not do.  But Michael Dell did.
One could also have been skeptical that a college dropout could invent something (an online distribution system for music) that several music publishers that devote hundreds of dollars to R&D could not do. But Shawn Fanning did.
One could also have been skeptical that a college dropout could invent something (an enterprise database management system) that several enterprise software companies that devote hundreds of millions of dollars to R&D could not do.  But Larry Ellison did.

OK, maybe not all of the competitors devote hundreds of millions of dollars to something, but there is plenty of precedent of someone thinking  up something new that others had not thought of.  I suspect diagnostics companies have not devoted much of their R&D budget to reducing the cost of blood tests because there is little incentive for it.  I would imagine that most of the money in diagnostics is in developing new assays, not finding a way to make the existing assays cheaper or hurt less.  Patients don't decide what tests they are going to get, and by and large they don't directly pay for it.

In theory, there is no reason why our current diagnostics require the volume of blood that is drawn, or why a smaller sample wouldn't work.  Handling and analysis of smaller volumes is an engineering problem, so there is no reason why Theranos couldn't work.  The problem, of course, is that it is a tricky engineering problem, especially because blood is prone to doing all sorts of things, like clotting, that you might not want it to do (depending on the test).

BC

Re: Bottom line? Don't drop out of Stanford... - CTcard - 10-07-2016

(10-06-2016, 07:35 PM)Boston Card link Wrote:One could also have been skeptical that a college dropout could invent something (an operating system for personal computer) that several enterprise computing companies that devote hundreds of millions of dollars to R&D could not do.  But Bill Gates did.

No problem with your overall point, but that's not exactly what Bill Gates did.

Re: Bottom line? Don't drop out of Stanford... - fullmetal - 10-07-2016

(10-06-2016, 07:35 PM)Boston Card link Wrote:In theory, there is no reason why our current diagnostics require the volume of blood that is drawn, or why a smaller sample wouldn't work.  Handling and analysis of smaller volumes is an engineering problem, so there is no reason why Theranos couldn't work.  The problem, of course, is that it is a tricky engineering problem, especially because blood is prone to doing all sorts of things, like clotting, that you might not want it to do (depending on the test).

What about small signals, diffusion/attenuation/sampling issues, and the large overall volume of blood in the body?  Those are the major reasons I've heard why nanoscale blood sampling isn't going to solve many biological diagnostic issues.

Re: Bottom line? Don't drop out of Stanford... - Roberton3 - 10-07-2016

(10-06-2016, 07:35 PM)Boston Card link Wrote:In theory, there is no reason why our current diagnostics require the volume of blood that is drawn, or why a smaller sample wouldn't work.  Handling and analysis of smaller volumes is an engineering problem, so there is no reason why Theranos couldn't work.  The problem, of course, is that it is a tricky engineering problem, especially because blood is prone to doing all sorts of things, like clotting, that you might not want it to do (depending on the test).

I'm certainly not an expert in this area, but according to a friend of mine who is, it's actually a physical impossibility to get reliable results from a sample as small as Theranos claimed.  According to him, going smaller than what's commonly used is an engineering problem, but there are limits to how small you can go (essentially a small-sample problem, though he said that was a big oversimplification), and Theranos claimed to be past those limits.  Again, though, I'm far from an expert here -- just going on what I was told.

Re: Bottom line? Don't drop out of Stanford... - BostonCard - 10-07-2016

A few things...

There are examples of small blood volumes being used accurately for quantitative results.  Think about portable glucometers that measure blood glucose levels for diabetics and operate on a single drop of blood.

Secondly, there are plenty of tests in medicine that do not depend on accurate quantitative results.  For example, while a laboratory pregnancy test measures HCG, the exact level of HCG doesn't matter in most cases since the level in pregnant women (10 or so days after ovulation) HCG levels are dramatically higher than non-pregnant women.  That's why home pregnancy tests based on urine work; it doesn't even measure HCG quantitatively.  In fact, lots of disease tests are handled that way.

There are definitely some things that you cannot or would not want to base on capillary blood drop.  But you could run a fairly successful diagnostics company using capillary blood drops for a ton of laboratory tests.

BC 

Re: Bottom line? Don't drop out of Stanford... - dabigv13 - 10-07-2016

What confused me is their judgement of market size....are there really a ton of people who want to skip the doctors office and go to a Theranos clinic to have bloodwork, no matter how little blood they need?

Plus Theranos just sounds like an evil corporation from a SciFi movie.

Re: Bottom line? Don't drop out of Stanford... - washingtonismoney - 10-07-2016

(10-07-2016, 11:59 AM)dabigv link Wrote:What confused me is their judgement of market size....are there really a ton of people who want to skip the doctors office and go to a Theranos clinic to have bloodwork, no matter how little blood they need?

Plus Theranos just sounds like an evil corporation from a SciFi movie.

Actually, the most confusing thing (IMO) was their idea that they could somehow systematically undercut the entire lab industry on price.

Re: Bottom line? Don't drop out of Stanford... - fullmetal - 10-07-2016

Yes, there is a brobdingnagian market for reliable, small-volume blood diagnostic tests that would enable people to skip the doctor's office.

I feel like the target diagnostic markets for Theranos have to be the ones that are already using blood for sampling.  Something like pregnancy, which uses urine, is much simpler and palatable to patients since blood isn't involved.  I think you'll find that patients will go to great lengths to avoid having to draw their own blood or prick their own fingers if they can (the bloodless glucometer is still not market-ready, I guess).

IIRC, Theranos' purported value proposition wasn't just the small volume of blood required for testing but also the immediacy of the results (lab-on-a-chip type stuff).  That's a game-changer for things like flu, Zika, HIV, etc. diagnoses.  In hot zones where time is even more critical, disease control efforts would be greatly enhanced by accurate, on-the-spot tests for Ebola, SARS/MERS, etc.

Re: Bottom line? Don't drop out of Stanford... - BostonCard - 10-07-2016

For dabigv...

I'm thinking more and more outpatient clinics are not doing their own phlebotomy.  If you are drawing your pre-op CBC's and coags in your office, I think you are part of a dwindling minority; most will just write the requisition and the blood will actually be tested in a centralized facility (maybe attached to a hospital) or an outpatient Quest diagnostics or equivalent (like, you know, a Theranos center).  The convenience of being able to do it at a drugstore, where many people are going anyways would seem to  be a positive.  Plus more and more pharmacies are developing their own Urgent Care-lite "minute" clinics, so to be able to have an NP see a patient, get them blood tested and dispense a prescription is pretty high.

WIM...

A lot of the costs are not in the actual testing (reagents, etc.), but rather in the phlebotomy and handling, which are much more labor intensive. 

The three things that I think Theranos underestimated: 1) The engineering challenge of dealing with small volumes of a viscous substance
2) the FDA.  Holmes may have been able to sweet talk a bunch of VC's to part with hundreds of millions of dollars based on hype and talk of disruption, but the FDA is arch-conservative and very skeptical of hype; the greater the "disruption" the more proof they will want that it works as well.  Her strategy was to shoot first and ask questions later on the thought that it is better to ask forgiveness than beg permission.  That didn't go over well with the FDA.
3) the press.  Holmes took for granted the idea that she could capture them under her spell of a great origins story, and that worked for many years.  But the press also sees red flags with secretiveness, and when they started seeing smoke, it was all over for her; the only thing the press likes more than a heroic origins story is a downfall of hubris story.

Re: Bottom line? Don't drop out of Stanford... - Roberton3 - 10-07-2016

(10-07-2016, 11:50 AM)Boston Card link Wrote:...
There are definitely some things that you cannot or would not want to base on capillary blood drop. 
...

But wasn't Theranos claiming they could do a lot of those things?  My friend didn't say everything Theranos claimed was impossible -- just that a lot of it was.

Re: Bottom line? Don't drop out of Stanford... - washingtonismoney - 10-07-2016

(10-07-2016, 12:40 PM)Boston Card link Wrote:2) the FDA.  Holmes may have been able to sweet talk a bunch of VC's to part with hundreds of millions of dollars based on hype and talk of disruption, but the FDA is arch-conservative and very skeptical of hype; the greater the "disruption" the more proof they will want that it works as well.  Her strategy was to shoot first and ask questions later on the thought that it is better to ask forgiveness than beg permission.  That didn't go over well with the FDA.

Gotta disagree with you here -- CMS was much more the problem than FDA, at least with Theranos's business model, which relied on building their own labs. For that, getting and maintaining their license was essential. Once the violations were found it was game over for the business model.

(The FDA did make them withdraw use of their "nanotainer" but they could still do testing with larger containers and/or needles...)