Theranos expert quits advisory board of blood testing group

A board of scientific advisers recruited by Theranos has suffered a setback after a leading member resigned, as outside experts and directors continue to distance themselves from the scandal-hit blood-testing group.

Theranos assembled the six-strong scientific advisory board (SAB) in April 2016 in an attempt to regain credibility following a damaging report from the Centers for Medicare and Medicaid Services, which regulates the laboratory testing industry.

Ann Gronowski, a professor in pathology and immunology at the Washington University School of Medicine in St Louis, resigned from the SAB at the end of last year, according to a statement from her university.

She was one of the most respected scientists on the scientific board at Theranos, according to several pathology academics. Her resignation has not been announced by the company and she is still listed as a member of the SAB on its website.

Ms Gronowski’s departure emerged during inquiries by the Financial Times last week, after Theranos and its founder, Elizabeth Holmes, were charged with“massive” fraud by the US Securities and Exchange Commission.

The charges, settled by Ms Holmes with a $500,000 fine and other sanctions, were the latest chapter in the downfall of Theranos, which was once lauded as a Silicon Valley disrupter for pledging to upend blood testing.

Threranos raised $700m from investors including Walgreens, Rupert Murdoch and Larry Ellison — and attained a valuation of $9bn at its height — after claiming it could replace needles with a revolutionary testing system needing just a few drops of blood.

But the company imploded after its technology fell far short of those assertions, setting off a series of investigations and inspections that resulted in Ms Holmes being banned from operating a medical lab for two years. A separate criminal investigation is still under way, according to two people briefed on it.

Ms Gronowski is the latest in a long line of experts and well-known figures to resign from Theranos, which at one point boasted a board of directors that read like a who’s who of America, including two former secretaries of state that have both since left: Henry Kissinger and George Shultz.

David Boies, the high-profile litigator, left the board in November 2016, while Jim Mattis, the retired marine corps general, resigned at the start of last year, shortly after he was picked as defence secretary by President Donald Trump.

Although the Theranos board of directors once included several prominent political and business figures, its lack of scientific expertise was identified by many in the blood testing field as a factor in the company’s mounting problems.

The criticism prompted Theranos to form the separate scientific board in 2016, and to recruit pre-eminent academics from leading institutions including the University of California, San Francisco, University of Pennsylvania, Dartmouth College and Weill Cornell Medicine.

Members of the scientific board are paid roughly $50,000 a year for their services and received shares in Theranos when they joined, according to one person familiar with the arrangement.

The person added that the scientific board was effectively inactive and had last met over dinner in November.

However, spokespeople for two other scientific advisers — Alan Wu from UCSF and Jack Ladenson — said they were still on the board. The remaining members and their representatives did not respond to a request for comment.

According to his spokesperson, Mr Wu joined Theranos after the alleged fraud took place, and did so to “maximise whatever potential the company’s technology might have to advance human health”.

Members of the board have been criticised by some of their contemporaries for lending plausibility to Theranos, even after the company was censured by regulators in early 2016 for putting patients at risk of “serious injury, harm, or death”.

“I have always been concerned that people from our profession would work for Theranos, because everyone knows what they were promising was impossible,” said Dr Andy Hoofnagle from the University of Washington.

Asked whether others should resign, Dr Geoffrey Baird, also from UW, said: “I don’t think they should have joined in the first place.”

A spokesperson for Theranos said: “Since their inception, the Theranos advisory boards have provided relevant insight and important contributions.”

She said the company had “shifted its focus” from clinical laboratory work to a new portable blood testing machine and the “nature of the technical advice and engagement [from the SAB] also evolved.”

“It is not uncommon for advisory boards to be compensated for their time,” she added.