Inspectors found deficiencies at Theranos' Arizona lab just days before the company closed all of its labs


Elizabeth Holmes

Jeff Chiu/AP

Before it closed its Arizona lab, Theranos failed an inspection that the company hadn't disclosed.

The Wall Street Journal reports that the Centers for Medicare and Medicaid Services, the government agency responsible for regulating clinical laboratories, concluded its inspection on September 29, just a few days before Theranos decided to shut down all of its clinical labs on October 5. The deficiencies found as a result of that inspection have resulted in more blood tests getting voided in addition to the two years' worth of blood tests it had previously voided

"After months of careful consideration, and prior to CMS's unannounced inspection in Arizona, Theranos decided to close its laboratories," Theranos' general counsel David Taylor told The Journal. "Theranos has been responding to the deficiencies raised by CMS and will continue the process of revising or voiding test results as appropriate until we are satisfied that we have taken all necessary remedial action." 

Theranos declined to respond beyond Taylor's comments. As The Journal notes, CMS inspections typically go public after 90 days, so it's unclear why this one hasn't been released to the public yet. 


In October, Theranos pivoted to focus solely on developing its technology instead of simultaneously operating clinical laboratories. The end goal? Getting its miniLab machine (which only requires a small amount of blood to function) in places that have difficulties sending full blood samples to a traditional, full-blown clinical lab operation. The technology debuted in August as part of Theranos' attempt to be what Holmes called a "decentralized" lab, meaning the test could be processed without needing to be shipped back to a brick-and-mortar lab.

On Tuesday, the company announced a new technology advisory board that would be responsible for reviewing the company's technology initiatives, help Theranos present its technology in peer-reviewed papers and presentations, and determine which technologies Theranos should develop.

Theranos' saga came into the spotlight in October 2015 after The Wall Street Journal published an investigation that questioned the accuracy of Theranos' blood test. In 2016, Theranos' northern California location was shut down, and Holmes was barred for two years from running a clinical lab, which Theranos has since appealed.

The company is now facing lawsuits from investors, patients, and its once partner Walgreens, which ended its relationship with Theranos in June 2016 and is accusing Theranos of breaching its contract. Theranos has said it will "respond vigorously to Walgreens' unfounded allegations."

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