Like millions of others, I was fascinated by the HBO documentary “The Inventor: Out for Blood in Silicon Valley,” which recounted the saga of wunderkind Elizabeth Holmes and her heavily hyped company Theranos, which claimed that it was revolutionizing health care with its one-drop blood test. It’s such a crazy, truth-is-stranger-than-fiction story that I wanted to know more, and Bad Blood: Secrets and Lies in a Silicon Valley Startup provides 300 juicy pages. But there’s plenty more to come; both Jennifer Lawrence and “Saturday Night Live”‘s Kate McKinnon are slated to portray Holmes in rival projects.
I do feel I benefited from watching “The Inventor” first so I could see and hear the deep-voiced blonde founder. A true 21st-century startup, Theranos’ brief lifespan was exhaustively documented, most notably in a ton of footage shot by acclaimed filmmaker Errol Morris, who directed several ads for the company. But Bad Blood is the ultimate insider chronicle, written by the Wall Street Journal reporter whose series of articles first brought the company’s misdeeds into the public eye. Before John Carreyrou came along, Theranos was one of Silicon Valley’s brightest stars, a company that seemed destined to change the world and make a lot of people very wealthy. A surprisingly large number of people already knew that Theranos was not what it purported to be, but Holmes had so many powerful friends and lawyers that anyone who dared speak out would live to regret it.
The first several chapters of Bad Blood follow a similar pattern: Somebody gets a job at Theranos, comes to realize that the amazing blood-testing system is a joke and a fraud, and either quits or gets fired. Everyone has to sign a sheaf of nondisclosure and nondisparagement agreements on their way out the door. Many of the employees try to inform Holmes or someone else in upper management about the problems with the machines, only to be rebuffed for not being a team player. At one all-hands meeting following a slew of resignations, “Elizabeth told the gathered employees that she was building a religion. If there were any among them who didn’t believe, they should leave.”
Carreyrou emphasizes that unlike many other startups, Theranos was playing with people’s lives; covering up the inaccuracy of test results produced by its machines could have dire consequences for the patients who were relying on them. Nevertheless, Holmes and her second-in-command/romantic partner Sunny Balwani resolutely pressed on, inking deals with Walgreens and Safeway. (When a consultant hired by Walgreens to evaluate the Theranos deal warned an exec that it was bad news, he was told, “We can’t not pursue this. We can’t risk a scenario where CVS has a deal with them in six months and it ends up being real.”)
It turns out that what Theranos was trying to do may be impossible: “running seventy different blood tests simultaneously on a single finger-stick sample… Thousands of researchers around the world… had been pursuing this goal for more than two decades… But it had remained beyond reach for a few basic reasons,” including the fact that different types of blood tests require different methods of testing. One micro-sample just isn’t enough.
Holmes managed to stock her board of directors with a bevy of rich, powerful old white men, including Henry Kissinger, George Shultz, four-star general James Mattis, and superlawyer David Boies, who provided legal work for Theranos in exchange for company stock. It’s hard not to draw the conclusion that these men were drawn to Holmes in part by her youth and beauty, and she obviously knew how to turn on the charm. Shultz, in fact, went so far as to side with Holmes after his grandson Tyler blew the whistle on Theranos after working at the company for a few months. Holmes, but not Tyler, attended Shultz’s 95th birthday party.
Finally, it all comes crashing down, despite the strong-arm tactics of Boies and his associates. It’s sobering to think what might have happened if Carreyrou had not pursued this story, and the Wall Street Journal had not backed him (despite the fact that the paper’s owner, Rupert Murdoch, had invested over $100 million in Theranos). Theranos “was first and foremost a health-care company,” not a tech company, he writes. “Doctors base 70 percent of their treatment decisions on lab results. They rely on lab equipment to work as advertised. Otherwise, patient health is jeopardized.” It’s pretty obvious that sooner or later, Theranos would have been discredited—its machines simply didn’t work—but it could have come at the cost of people’s lives.
Holmes and Balwani seemed to think that if they just pushed their beleaguered employees hard enough, eventually they’d come up with a breakthrough. Holmes’ “ambition was voracious and it brooked no interference,” Carreyrou concludes. “If there was collateral damage on her way to riches and fame, so be it.” And while the case against Holmes will go to trial in 2020, she appears to be enjoying a pretty cushy lifestyle in the meantime: she’s attended Burning Man, she recently married a wealthy heir, and she owns a Siberian Husky dog she claims is a wolf. After reading Bad Blood, it wouldn’t surprise me if she manages to escape the consequences of her despicable actions. She certainly seems to display zero remorse for the things she did during the years she ran Theranos.