What we learned this week in the trial of Elizabeth Holmes
By Rishi Iyengar, CNN Business
It was an eventful week in the closely-watched trial of Elizabeth Holmes, with witnesses who included scientists, medical professionals, a patient and even the former US Secretary of Defense laying out how the promise of Holmes’ blood testing company Theranos fell apart.
Here’s what you need to know.
The miscarriage that wasn’t
One of the most potentially damning testimonies came on Tuesday, when nurse practitioner Audra Zachman and then her patient, Brittany Gould, took the stand.
Zachman, who works at an OB/GYN practice in Phoenix, Arizona, testified she requested a hormone test to help track the progress of Gould’s pregnancy. “I encouraged her to go to Theranos,” Zachman said, adding that the test required multiple blood draws and “if it was an opportunity to be less invasive, that was enticing.”
Gould previously had three miscarriages, and Theranos’ tests indicated she might yet again suffer “a threatened abortion or potentially a complete loss of the pregnancy,” Zachman said. But additional test results from a Theranos competitor indicated that Gould’s pregnancy was fine, and she subsequently carried the baby to term and gave birth without any issues.
Gould, a medical assistant herself whose duties included drawing other patients’ blood, testified that she got her finger pricked at a local Walgreens in Phoenix.
“It was a little confusing, the conflicting information,” Gould said, describing the discrepancy between the Theranos tests and the ones she subsequently got that showed the correct values. She never went back to Theranos, she said, because “I didn’t feel like I could trust it.”
The former SecDef’s reputation
The most high-profile witness so far unexpectedly took the stand on Wednesday afternoon, with the court pausing an ongoing witness testimony to accommodate him.
James Mattis, the former US Secretary of Defense and four-star general, recounted how he lost confidence in Theranos over the course of roughly three years as a member of the company’s board. Mattis is the first of Holmes’ well-known associates to testify — a list that also includes media mogul Rupert Murdoch and former Secretary of State Henry Kissinger.
After a certain point, he said he “didn’t know what to believe about Theranos anymore. I couldn’t see why we were being surprised by such fundamental issues.”
A glimpse into Holmes’ cellphone
Wednesday’s previous witness, who returned to the stand after Mattis, was Justin Offen, global forensic technology leader at the consulting firm PwC. Offen compiled and analyzed thousands of text messages between Holmes and her ex-boyfriend, Theranos’ former chief operating officer Ramesh “Sunny” Balwani. (Balwani faces a separate trial on the same fraud charges as Holmes and has also pleaded not guilty.)
Some text messages were displayed and read out in court, and they indicated both Holmes and Balwani’s awareness of the issues Theranos was facing.
“Normandy lab is a disaster zone. Glad I came here. Will work on fixing this,” read a text from Balwani in November 2014, referring to one of Theranos’ testing facilities.
In messages to Balwani had sent days earlier, Holmes said: “Fundamentally, we need to stop fighting fires by not creating them. Need to fix root cause here.”
Some of the texts also show Balwani urging restraint as Theranos garnered more and more publicity, evidence meant to potentially undercut Holmes’ expected argument that Balwani was pulling the strings at Theranos.
“There is too much hype around Theranos and you,” one of his texts to her read. “FYI, I am worried about overexposure without solid substance which is lacking right now.”
A rushed launch
Adam Rosendorff, who was a lab director for Theranos from April 2013 to November 2014, testified on Friday. Rosendorff said he left Theranos for many reasons, one of which was being pressured to vouch for tests he did not have confidence in.
“I came to believe that the company believed more about PR and fundraising than about patient care… the platform was not allowing me to function effectively as a lab director,” Rosendorff said.
When interviewing for the job Rosendorff said he was impressed by the “earnestness and dedication” in Holmes and Balwani, believing the company could be the next Apple.
Rosendorff described the events leading up to the commercial launch of Theranos devices in September 2013 as extremely rushed and hurried, as Holmes struggled to satisfy the board and investors. With fewer than 10 days to go before the launch, Rosendorff said none of the tests were validated for patient care.
Rosendorff expressed his concerns about inaccurate test results and his desire to push back the launch date to Holmes in her office. He said Holmes was clearly nervous, but not surprised by the issues raised.
“She was trembling a little bit, her knee was tapping, her voice was breaking up,” Rosendorff said.
Holmes pushed for the launch and told him that rather than using Theranos technology, they would use conventional analyzers.
Rosendorff will testify further when the trial resumes on Tuesday.
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CNN Business’ Sara Ashley O’Brien and Ramishah Maruf contributed to this report
