Former Theranos Directors Did Not Follow Up On Public Allegations, Court Documents Reveal
“It didn’t occur to me," one said when asked if he probed into whether the company's much-hyped proprietary technology was working.
The Wall Street Journal:
Court Documents Shed Light On Theranos Board’s Response To Crisis
Two former Theranos Inc. directors said they didn’t follow up on public allegations that the Silicon Valley blood-testing firm was relying on standard technology rather than its much-hyped proprietary device for most tests, according to newly released court documents. In depositions, the highly decorated former directors—former U.S. Navy Adm. Gary Roughead and former U.S. Secretary of State George Shultz —who were board members when concerns of employees and regulators became public—said they didn’t question Theranos founder Elizabeth Holmes about the matter. (Weaver, 5/30)
In other health industry news —
The New York Times:
When ‘Political Intelligence’ Meets Insider Trading
A case involving insider trading charges based on government information dispensed by a “political intelligence” operative raises interesting questions about how some of the tricky rules for proving the offense will be applied when information is leaked from a federal agency rather than a corporation. An indictment filed in United States District Court in Manhattan accuses David B. Blaszczak of exploiting his friendship with Christopher M. Worrall, who held a senior staff position at the Centers for Medicare and Medicaid Services, to learn about impending changes in Medicare reimbursement that would affect health care companies. Mr. Blaszczak then passed the information, the indictment says, to Deerfield Management, a hedge fund firm that was a client of his consulting firm. (Henning, 5/29)
Kaiser Health News:
Target Of Medicare Insider Trading Case Boasted He Was Unstoppable ‘Beast’
In his prime, consultant David Blaszczak bragged that he made millions for his hedge-fund clients when he predicted important Medicare funding changes. “Warren Buffett can eat it,” Blaszczak wrote in one email in 2013, referencing the legendary stock trader. He boasted in that same year to a finance executive: “I am a beast that cannot be stopped.” (Jewett and Bailey, 5/30)
