A former lab collaborator continued her testimony Wednesday in the federal criminal trial against Elizabeth Holmes, founder and CEO of blood testing company Theranos.
Erika Cheung told the jury that the Theranos “Edison” machines, believed to be capable of providing multiple blood test results based on the value of a finger prick, “frequently failed” quality control tests.
The “QC” procedures involved performing a test on a sample with a known concentration of a particular substance – vitamin D, for example – to see if the machines were giving the correct answer.
But Theranos had a workaround when the QC tests failed. Cheung said the company has implemented a system of “removing outliers”, “choosing the best data points to give the impression that the quality” of the results has succeeded.
Removing one or two data points to bypass quality control issues, a process Cheung described as “cherry picking,” was common practice with “no rules” and “no protocols.” .
The failures of the Edison machines were well documented. Cheung said tests performed on patient samples inside Theranos have shown large discrepancies between Edison’s results and results from traditional blood testing machines approved by the FDA and made by third parties.
Again taking the example of vitamin D, Cheung said the Edisons sometimes showed up to three times the levels of vitamin D in blood samples than those found using traditional testing methods, supporting his testimony. with a spreadsheet comparing the results.
The spreadsheet showed that when tests on the same samples were run a second time, traditional machines usually got the same result, while Edison’s often gave very different results the second time around.
Cheung testified that Edison’s erroneous test results were not shared with regulators.
Cheung raised concerns about the company’s methods and arrangements when she was called into the office of Ramesh “Sunny” Balwani, Holmes’ second in command and alleged co-conspirator. Rather than respond to concerns, Balwani left Cheung with the impression that “if I wanted to work here, I have to process patient samples without a doubt,” she said.
Holmes and Balwani are both charged with 12 counts of wire fraud and conspiracy to commit wire fraud in relation to Theranos’ finger prick tests. Balwani will be judged separately.
Despite a strong objection from the defense, Cheung then testified about an email sent by his colleague at Theranos, Tyler Shultz, to his grandfather, the former US Secretary of State and member of the Council of administration of Theranos, George Shultz.
Tyler Shultz showed Cheung the email before the two went to dinner at the former secretary’s to talk about what was going on at the company. In his email, Tyler Shultz expressed concerns similar to those raised by Cheung about the practice of removing “outliers” from Edison’s results. Tyler also took issue with public statements made by the company about the accuracy of the Edison tests.
At dinner, Cheung told George Shultz that Edison tests performed as demonstrations – involving a finger prick followed by inserting a cartridge into an Edison – were a facade.
In fact, three or four employees were standing by to remove the cartridge and take it to the downstairs laboratory of Theranos, known as “Normandy”, where the tests were quickly run on third-party machines. modified by Theranos to process the small sample.
Cheung left Theranos in April 2014. In June 2015, she received a letter of “warning” from David Boies, the famous litigator and partner at the law firm Boies Schiller Flexner, telling her to “stop and go. refrain “from disclosing Theranos’ business. secrets and making “false and defamatory” statements about the company.
Cheung understood that Boies’ letter referred to her conversations with a Wall Street Journal reporter about her experience at Theranos, a step she took as a “last resort” to “get the truth out about what was happening. to patient samples “in the company.
Earlier today, U.S. District Judge Edward Davila handed prosecutors an evidentiary victory when he dismissed defense objections to a series of emails detailing quality control issues at the Theranos lab .
Holmes defense attorney Lance Wade argued that emails that did not show Holmes as the sender or recipient were inadmissible hearsay and damaging to their client’s case.
Assistant U.S. Attorney John Bostic responded that the emails were “contemporary reports from Theranos employees regarding issues they were observing directly in Theranos’ clinical lab” and “were obligated to to signal and commemorate “.
In a lengthy oral court decision, Davila pointed out that “especially in Silicon Valley… has happened, similar to a traditional business case.
Cheung then testified over numerous emails that the defense had tried to exclude.