On Sunday, Walgreens Boots (NASDAQ: WBA) announced it will cancel the operation of 40 Theranos Wellness Centers at its drug stores in Arizona. The allied blood-testing company has been accused of offering incorrect results to customers.
The pharmaceutical company had previously removed Theranos laboratory testing services from its stores in Palo Alto, California, in January. During the same month, the blood-testing private company was requested to stop operating with tests provided by Wellness Centers at Walgreens.
Theranos was founded in 2003 by Elizabeth Holmes, a deserter from Stanford University, to offer revolutionary a blood test that only depended on a finger pinch. The Palo Alto-based company has been receiving bad reviews and lower rates over the last months.
A complicated relationship has finally come to an end: federal officials are considering to sanction Theranos
In January, federal regulators revised Theranos laboratories in California and found problems with tests results. During that time, Walgreens announced that Theranos had to send blood tests collected at Wellness Centers, to a Theranos’s certified lab in Phoenix or third-party labs.
Elizabeth Holmes could be banned from the laboratory industry for up to two years, depending on the officials’ final verdict. Meanwhile, Walgreens has decided finally to terminate its relationship with the blood-testing company.
Brad Fluegel, Walgreens Senior Vice President and Chief Health Care Commercial Market Development Officer (CMS), announced that Theranos laboratories are being tested by the Centers for Medicare and Medicaid Services.
“In light of the voiding of a number of test results, and as the CMS has rejected Theranos’ plan of correction and considers sanctions, we have carefully considered our relationship with Theranos and believe it is in our customers’ best interests to terminate our partnership,” said Fluegel in a statement.
Theranos has plans to continue providing services in the United States
Brooke Buchanan, a spokeswoman for Theranos, told the New York Times that the blood-testing business will not come to an end. The health-technology company is expecting to offer its services in stand-alone retail locations.
Five Theranos facilities in Arizona and one in California are already functioning. The company has also plans to expand its stand-alone locations in Arizona. Buchanan said that Theranos is “disappointed” about Walgreens’ decisions.
According to Buchanan, Theranos seeks to provide “affordable health information” to patients. The company is apparently working with government regulators to “comply with all federal regulations and exceed them,” as reported by the New York Times.
Elizabeth Holmes worth was calculated at $4.5 by Fortune experts. Her company became immediately popular, after offering blood tests from a single drop of blood. Frequently, the same tests require the extraction of blood from the arm in larger quantities.
The Theranos founder owns nearly half of the company. According to sources who spoke to The Wall Street Journal, Theranos was using standard equipment obtained from vendors. The company was conducting blood tests with the same machines as competitors, but using less blood.
Theranos has voided results from customers in Arizona and has corrected some others. According to the Journal, the company had hired non-qualified personnel to carry out blood tests analysis.
Source: Walgreens Press Release