Three years ago, Walgreens invested in Elizabeth Holmes’ medical technology startup, Theranos. The relationship between the drugstore retailer and Holmes—Theranos’ head, who, as a Stanford dropout, had an origin story worthy of Silicon Valley’s best—marked the public announcement of the company. The New York Times notes that prior to Walgreens’ partnership with Theranos, the company had been operating in “stealth mode” since its founding in 2003.
The relationship was central to Theranos’ sustainability (or, at least, its outward fiction of sustainability), but Walgreens announced late Sunday that it would sever ties the biotech company. According to the Wall Street Journal, Walgreens had grown increasingly frustrated after learning that Holmes’ Theranos had corrected thousands of blood tests, including ones performed at Walgreens’ retail locations. Theranos technology had been operational in some 40 Walgreens locations in Arizona.
The partnership between Theranos and Walgreens began in 2013, and the company gave Theranos a hefty dose of credibility to match the ludicrous myth-making that surrounded Holmes herself. The deal helped Holmes climb the latter of startup celebrity; eventually, her wealth was valued at $4.5 billion, an estimate that has since been downgraded to zero.
It’s emerged that Theranos had been unable to supply Walgreens with details about the future of the company (an increasingly familiar complaint) after regulators found major problems at Theranos’ head lab in California. In January, after regulators announced their findings, Walgreens suspended its relationship with Theranos, and though regulators have not yet announced their action plan—which might include potentially banning Holmes from industry for two years—Walgreens has made its decision clear. In a statement, Walgreens said:
“In light of the voiding of a number of test results, and as the Centers for Medicare and Medicaid Services has rejected Theranos’s plan of correction and considers sanctions, we have carefully considered our relationship with Theranos and believe it is in our customers’ best interests to terminate our partnership.”
Though Theranos continues to operate its own retail locations, Walgreens was the company’s largest supplier, and the promise of the company—that it could revolutionize blood testing, reducing costs by only taking a single prick (how literary!)—has proven to be little more than a smokescreen.
Surely there’s some lesson to be drawn here, a mournful reflection on the familiar narratives of industry, genius, eager investors, and the emptiness of disruption, but we’ll have to wait for Jennifer Lawrence and Adam McKay to truly figure it all out.
Image via AP.