Elizabeth Holmes, the creator of Theranos, who gained notoriety when her blood testing company went out of business amid accusations of fraud, is scheduled to go to prison on Tuesday to begin a sentence of more than 11 years. Holmes was convicted of four counts of wire fraud in January 2022.
Her conviction marked the end of a journey that began in 2003 when she dropped out of Stanford University at the age of 19 to launch a business whose technology she hoped would allow the diagnosis of several ailments with just a drop of blood.
With a peak valuation of over $9 billion, Holmes over the course of the next ten years made Theranos a favorite in Silicon Valley.
The Walton family, who are the inheritors of the Walmart corporation, as well as US Education Secretary Betsy DeVos, are prominent businesspeople who have invested in Theranos. James Mattis, a former secretary of defense, two former senators, Henry Kissinger, and George Shultz, former secretaries of state, would join Theranos’ existing board of directors.
However, as a result of revelations that the company’s technology did not seem to operate as claimed and that it could produce inaccurate findings, headed by then-Wall Street Journal journalist John Carreyrou, Theranos’ claims about its capabilities started to fall apart.
The pandemic would push back the trials for Holmes and Balwani until the fall of 2021. Holmes’ defence mostly focused on assertions that Balwani had influence over her, an allegation that Balwani later refuted. Holmes added that she had not intended to deceive investors.
The jury found Holmes guilty despite rejecting the majority of his defences. Holmes and Balwani, who had both been found guilty, were given their sentences in the fall of 2022. According to experts, Balwani’s prior expertise in managing other enterprises led to a harsher sentence of nearly 13 years in prison.
In a recent New York Times profile, Holmes indicated she still harboured ambitions to build in the medical technology industry. “I still dream about being able to contribute in that space,” Holmes said. “I still feel the same calling to it as I always did and I still think the need is there.”