Elizabeth Holmes speaks at the Fortune Global Forum in San Francisco, on Nov. 2, 2015.
Jeff Chiu—AP
By Dr. Arthur L. Caplan
April 20, 2016
IDEAS
Dr. Arthur L. Caplan is the director of the division of medical ethics at New York University Langone Medical Center

Had your blood drawn lately? If not chances are good you will soon. About 10 billion tests are done every year on our blood. Diagnostic blood tests are a huge component of American health care, costing $73 billion a year—roughly $10 billion of which comes from Medicare and Medicaid.

Not only do blood tests cost a fortune, the results of these tests determine a huge proportion of what happens next to patients. Whether you get a prescription, undergo further testing, enter the hospital, begin chemotherapy and hundreds of other decisions rely on the results of testing your blood.

But blood testing is clunky. It is no fun getting yours drawn, and current technology requires a fair amount of it in order to glean any information from it. That’s why investors went bonkers when Elizabeth Holmes, a Stanford University dropout, announced a new company that claimed it could conduct the first extensive diagnostic from a single drop of blood.

Not too long ago, Holmes was declared the world’s youngest self-made billionaire. Today, her company Theranos is under investigation by the U.S. Securities and Exchange Commission and the U.S. Attorney’s Office for the Northern District of California. Its future is not bright.

Read more: The Theranos Downfall Was Inevitable

So how could this happen? Let me suggest a few ways.

First, the company’s story is enticing—too enticing: Another Bay area dropout finds a disruptive technology that can revolutionize a stodgy industry. That is a story we have all come to believe in. But, it is a story that is not always a fact. No, not all the best technology is cooked up in garages or DIY labs.

Second, there’s no beef, so to speak. No lectures, published abstracts or papers discussing the nature of the breakthrough. No one expects the full disclosure of the secret sauce, but claims of breakthroughs need to have a bit of disclosure in order to be believed. Those who want to be pioneers find it hard to believe, but independent assessment is crucial for evaluating any claim of a medical breakthrough—not just testimonials and trust-me.

So why did we believe? We wanted it to be true. Given all the progress happening in genomics, immunotherapies and precision medicine, shouldn’t it make sense that a drop of blood contains all that is needed to diagnose anything and everything? Well, maybe, but despite the hype, it has taken decades to get from the first map of the human genome to anything resembling precision medicine. Will diagnostics move any faster?

Hope and greed make for dangerous bedfellows. Theranos seems to have suffered from both without enough doubt from many of the rest of us—who should know better.

Dr. Arthur L. Caplan is the director of the division of medical ethics at New York University Langone Medical Center

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