The one that was once announced as a blood test specialist, Theranos, will now formally dissolve only weeks after its CEO was charged with criminal fraud.
Theranos told its shareholders by email on Tuesday that it plans to dissolve and pay the remaining cash to the creditors, the Wall Street Journal reports.
Elizabeth Holmes, the founder of the company plagued by scandals, was formally indicted by federal prosecutors in June for allegedly defrauding investors, doctors and the public in a multi-million dollar scheme.
The former second in command of the company, Ramesh & # 39; Sunny & # 39; Balwani, he was also accused.
The blood test startup Theranos will now formally dissolve only weeks after its CEO Elizabeth Holmes was charged with criminal fraud for allegedly defrauding investors, doctors and the public in a multi-million dollar scheme
Holmes, who was once considered a child prodigy from Silicon Valley, and Balwani were charged with conspiracy to commit electronic fraud and nine counts of electronic fraud each.
He launched Theranos in 2003 in Palo Alto, California, launching his technology as a cheaper way to run dozens of blood tests.
Holmes announced that the company is a more economical and efficient way for patients to test for life-threatening diseases, such as cancer and diabetes, with just a few drops of blood from their fingers.
But prosecutors allege that Holmes and Balwani deliberately deceived investors, lawmakers and the public about the accuracy of Theranos blood test technologies since at least 2013.
A notoriously secretive company, Theranos shared very little about his blood test machine, nicknamed Edison, with the medical or public community.
Holmes said he was inspired to start the company in response to his fear of needles.
Holmes, who was once considered a child prodigy from Silicon Valley, launched Theranos in 2003 in Palo Alto, California, launching its technology as a cheaper way to do dozens of blood tests.
Prosecutors allege that Holmes and Balwani deliberately deceived investors, policymakers and the public about the accuracy of Theranos blood test technologies.
He also carefully designed his image, wearing black turtleneck sweaters that earned him the nickname of Silicon Valley as "the next Steve Jobs."
The investors bought what Holmes was selling and invested hundreds of millions of dollars in the company. At one point, Theranos was worth more than $ 10 billion and Holmes, the youngest self-made female billionaire.
But an investigation by The Wall Street Journal two years ago found that Theranos' technology was wrong at best, and that the company was using routine blood test equipment for the vast majority of its tests.
The story raised concerns about the accuracy of Theranos blood test technology, which puts patients at risk of having poorly diagnosed or ignored conditions.
The Journal's investigation marked the beginning of the end of Theranos.
Walgreens finalized its blood test association with the company, and the Department of Health and Human Services effectively banned Theranos in 2016 from performing any blood tests.
The Securities and Exchange Commission filed charges of civil fraud against Holmes and Balwani earlier this year. Holmes reached an agreement with the SEC to agree to pay $ 500,000 in fines and penalties, while Balwani is fighting the charges.