Post-Theranos, Startups Are Still Out for Blood

‘Hubris is very dangerous’: How blood diagnostic companies are distancing themselves from Theranos’ fraud charges

Illustration: Ariel Davis

Tanay Tandon ditched class the day Elizabeth Holmes came to speak to his fellow freshmen at Stanford University a few years ago. At the time, says Tandon, now 22, the campus community was already skeptical about Theranos, Holmes’ now-infamous blood testing company. That’s because her talk took place around the time John Carreyou at the Wall Street Journal published his first story questioning Theranos’ legitimacy. According to Tandon’s classmates, Holmes — who dropped out of Stanford to start her company — spent part of her lecture explaining to the students why she felt the accusations against her were wrong.

“It was the brink of everything starting to explode,” Tandon says about her visit.

The meteoric rise and fall of Holmes and Theranos has been the subject of the Wall Street Journal investigation, a bestselling book, a podcast, and a documentary. Most damningly, the U.S. Securities and Exchange Commission has charged Holmes and former Theranos president Ramesh “Sunny” Balwani “with raising more than $700 million from investors through an elaborate, years-long fraud in which they exaggerated or made false statements about the company’s technology, business, and financial performance.”

“It has been a black eye for the field to have this thing occurring.”

Tandon is on a leave of absence from Stanford and is now the founder of a finger-prick blood testing startup called Athelas, which he hopes will one day allow chronically ill people to test themselves in the privacy of their own homes. Despite the similarities between Tandon and Holmes, Tandon says the swirl of negative publicity surrounding Theranos has ultimately created more, rather than less, interest in the field.

Athelas is one of a handful of biotech companies seeking simpler blood-based diagnostics. Karius is a company that says it can identify more than 1,000 pathogens from a single blood draw in order to quickly diagnose infectious diseases. MindX Sciences is an Indianapolis-based startup that’s developing blood tests for…