By now, you’ve likely seen the recent buzz around the Elizabeth Holmes verdict. On January 4, the former CEO and founder of the now-defunct Theranos was found guilty on four of 11 charges of fraud and conspiracy. Prior to the trial, her meteoric rise and resounding fall from grace – not to mention the bizarre rumor that she never blinks – have fascinated the general public and garnered attention across pop culture. It’s no wonder that word of the verdict echoed across mainstream media.
So, what can we stand to learn from one of Silicon Valley’s most fascinating frauds?
Peer-reviewed research matters.
As a scientific writer and content strategist on the Reputation & Risk Management team, I’m constantly assessing the best ways to explain the promise of a client’s science without over-indexing. Despite an industry-wide understanding that we must avoid overpromising and underdelivering at all costs, it’s unfortunate to see that some companies still manage to let ambition outpace reality. When it comes to assessing whether promises made are unrealistic, peer-reviewed research is paramount and secrecy often serves as a red flag.
In a recent article in Nature, James Nichols, a professor at Vanderbilt Medical Center in Nashville, attributes the downfall of Holmes to the fact that she “held Theranos’s technology as proprietary, didn’t publish it and didn’t want to share it with the community.” As a former academic researcher, I’ve always felt that industry stands to learn a lot from academia when it comes to collaboration and data sharing. At first glance, this lesson may be framed for med device / healthtech companies where the regulatory process is arguably less rigorous – or private companies where the burden on investors is even higher – it also resonates within drug development.
Yet another reason diversity is so important.
I was doing a lot of vigorous head nodding as I read last September’s New York Times article on this case, which underscored the power imbalance that exists between male investors and female entrepreneurs. As a former engineer, I can attest to the very real pain points of being a female in a male-dominated discipline. Could it be that Holmes is being held accountable for something that her male counterparts often get away with? One could refute this given the forthcoming trial of ex-Theranos COO (he’s male). But, it’s still interesting food for thought.
A recent opinion piece in TIME by entrepreneur, investor, and adjunct professor Jamaal Glenn purports that age diversity on corporate boards is what will help mitigate another Holmes-like fiasco. The “star-studded list of political and business titans” on the Theranos board failed to serve as the “first line of defense.” The author calls to avoid the all-too-common board that is “old and out of touch, rife with industrial-era yes-men who are beholden to their CEOs and ill-equipped for the digital age.” (ouch!).
Let science lead the way.
Of the remaining seven charges, the jury either found Holmes not guilty or was unable to reach a verdict. In a way, this outcome underscores the gray area that can exist when drawing the line between ambition and fraud. As blurry as that line may be, well-designed scientific studies will always be the key to bringing it into focus.
Given only about 10% of investigational therapies reach the market, clinical trials with disappointing readouts aren’t uncommon. But, a trial not meeting its endpoint(s) is still a “win” in that the scientific process is providing answers and those answers lead to progress (even if that progress is a change in direction). “Failed” trials remain important moments that push the industry forward. Though Holmes chose to hide behind lofty claims and unrealistic promises, I remain optimistic in remembering that science will always weed out baseless ambition.
