Theranos CEO faces ban from operating a blood-testing lab

As more details surface about blood-testing startup Theranos, federal regulators are looking to ban the company's founder. The Wall Street Journal reports the Centers for Medicare and Medicaid Services (CMS) is looking to not only revoke Theranos' federal license, but it also wants to keep its founder and CEO Elizabeth Holmes and president Sunny Balwani from owning or running another lab for a minimum of two years. Theranos currently has testing facilities in California and Arizona, so the ban would impact both locations.

The actions were revealed by CMS in a letter dated March 18th. Theranos had 10 days to respond to the proposed action from regulators, which it did, giving an explanation as to why the penalties shouldn't be imposed. Even if regulators take action, the appeals process would allow the company to keep its license during those proceedings. A Theranos spokesperson told WSJ that it's hopeful the "corrective measures" it implemented in recent months will help it avoid the proposed penalties from CMS.

If you're not up to date on the news, Theranos gained attention for offering blood-test results with no more than a finger prick. FDA investigators began looking into the company last fall based on data it submitted regarding its testing procedures. In the time since, reports have revealed a wealth of information about Theranos' practices, including blood analyzers that weren't inspected for years (by CMS no less), former employees detailing faulty testing procedures and sending inaccurate results to patients.

Back in January, regulators stated that the company's lab work jeopardized patients' health and safety, which led to Walgreens cutting ties with the startup. Earlier this month, a report released by CMS revealed that Theranos' lab failed to meet its own internal accuracy standards in addition to not notifying patients of inaccurate results in a timely fashion and improper storage of blood samples.