Only One Week After Voiding Two Years of Tests, Theranos Now Faces Consumer Class Action Lawsuit
May 26, 2016 (Last Updated: 12:30pm PT)
By Alex Keown, BioSpace.com Breaking News Staff
PALO ALTO, Calif. – It was only a matter of time, but the first lawsuit against embattled blood-testing company Theranos has been filed since the company announced it had invalidated two-years of test results.
Currently the lawsuit seems to have been filed by one individual, but there is the potential the lawsuit could become a class action affair as other patients climb on board. Biz Women, a business journals publication, reported the lawsuit was filed in U.S. District Court for Northern California for an Arizona resident identified only as “M.P.B.” The team of attorneys from McCuneWright LLP said in the filing that it is designed as a class-action suit, Biz Women reported.
The lawsuit followed only a week after Theranos invalidated two years of results of its test results to doctors and customers, meaning that some of the information sent could have been incorrect, leading to doctors making an incorrect diagnosis. That issue of incorrect diagnoses is at the heart of the lawsuit.
“Tens of thousands of patients may have been given incorrect blood-test results, been subject to unnecessary or potentially harmful treatments and/or been denied the opportunity to seek treatment for a treatable condition,” the plaintiff, said in the complaint, according to a Bloomberg report.
Brooke Buchanan, Theranos’ vice president of communications, told BioSpace this morning that the lawsuit was without merit and the company “will vigorously defend itself against these claims.”
The California-based company, once a darling of investors, invalidated results for 2014 and 2015 and has issued “tens of thousands” of corrected blood testing results to patients and doctors, the Wall Street Journal first reported. The company told federal regulators with the U.S. Center for Medicare and Medicaid Services about their decision to void the test results for the two year period. Following an initial and excoriating review of Theranos’ Newark, Calif. laboratory, Theranos said it had “voided results associated with any findings that were not consistent with the quality standards the lab holds itself to today, under our lab’s new leadership.” At the time Theranos announced this measure, the concept of two years of data being tossed out was unfathomed.
It is unknown at this time if Walgreens, Theranos’ biggest partner, will terminate its relationship with the company that had once been valued at $9 billion. Since issues with Theranos’ testing have been raised, Walgreens has distanced itself from the company and has discussed terminating its relationship.
The company has since reperformed the tests it invalidated, but used more traditional blood-testing machines as opposed to Theranos’ proprietary Edison machines. Theranos’ Edison machines were once called revolutionary and supposedly able to determine a number of medical diagnostic questions based on a single drop of blood. However, the efficacy of the blood testing devices have been called into question a number of times over the past year. In April, the U.S. Department of Justice launched a criminal investigation into the company, with investigations centering on whether or not Theranos and its executives misled investors as to the efficacy of its blood-testing products. News of a criminal investigation comes less than a week after reports revealed that Holmes could face a possible federally-mandated two-year suspension from the blood testing industry over failures to address deficiencies at lab facilities in California. In previous interviews Buchanan said Theranos has been working to address the issues raised by the CMMS.
In a lightly redacted 45-page letter dated March 18 over those concerns, the CMMS repeatedly used the bold-texted phrase “The laboratory’s allegation of compliance is not credible and the evidence of correction is not acceptable.” The phrase is used to indicate how Theranos’ addressing of issues that fail to meet federal Clinical Laboratory Improvement Amendments (CLIA) guidelines. While many of the errors could be considered minor, the overwhelming number is concerning—something CMMS investigators noted in their letter.
“In general, we find that the statements made in the allegation of compliance and evidence of correction: 1) failed to adequately address the deficient practice cited; 2) are incomplete and failed to meet the criteria of acceptable evidence of correction; 3) do not ensure sustained compliance; and 4) show a lack of understanding of the CLIA requirements,” the letter said.