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Elizabeth Holmes trial: what we learned this week

Things picked up speed at the end of the three-day hearing week, as jurors heard from two government witnesses: former Pfizer scientist Dr Shane Weber, who recommended the company not to team up in Theranos, and a Theranos investor, Bryan Tolbert. .

For the first time, jurors heard the infamous voice of Holmes, as the government released audio clips of an appeal to investors in December 2013. Tolbert said he recorded the call before his company decides to invest an additional $ 5 million in the business after first investing $ 2 million in 2006.

Before the start of the day on Friday, a third juror was excused. The juror was released after telling the judge that she was playing sudoku during court proceedings to help her stay focused, the The Wall Street Journal reported, citing a court transcript. There are only two alternative jurors left, with the trial set to extend until December.

Once hailed as the next Steve Jobs, Holmes faces a dozen federal fraud charges over allegations she knowingly misled investors, doctors and patients about her company’s blood testing capabilities in order to take their money. She has pleaded not guilty and faces up to 20 years in prison.

Theranos was once valued at $ 9 billion, with investors and partners convinced its technology could effectively test diseases like cancer and diabetes with just a few drops of blood taken from a finger prick. But the business began to collapse after a 2015 the Wall Street newspaper the investigation dug holes in the capabilities of its technology and blood testing methods.

Here are some of the key moments from inside the courtroom this week:

Media mogul Rupert Murdoch had a blood test

Jurors were shown a January 2015 email exchange between Rupert Murdoch and Holmes which indicated that the media mogul, who had heavily invested in the startup, had visited his offices and had his blood tested by the company.

In an email, Holmes wrote: “It was wonderful to have you here today. I look forward to the opportunity to continue our conversations, including one day a more detailed conversation on China … I [sic] It would be an honor to have you with us. Murdoch replied, “Thank you, Elizabeth. I enjoyed every minute. Blood results? Goodbye. Rupert. ”
An internal email shown in court revealed problems with its results: “CO2 is emitted much earlier than usual, so it’s a bit high,” part of the email read. He also noted that there was no sample to “rerun as it was a short run”. It is not known what was communicated to Murdoch regarding his results. The emails were presented during Edlin’s testimony.

Murdoch is one of many prominent figures listed as a possible government witness. The Wall Street Journal reported in 2018 that “the losses for Mr. Murdoch, once the company’s largest investor, total more than $ 100 million.”

Internal disputes over how Theranos should market itself

As Theranos prepared to announce its key partnership with Walgreens, launching a wave of media coverage over its blood tests, a lawyer described a number of language changes that are expected to appear on its website. The attorney’s advice highlighted the fine line Theranos had to cross with his claims.

Some of the tips of the lawyer included: “Make sure of the rationale for ‘reduces risk of anemia.’ “” Replace “faster and easier” with quick and easy. “” Replace higher levels of accuracy with higher levels of accuracy. “Change from more precise to precise.” “Remove ‘unmatched precision’.”
But some of the original language, including the “highest levels of precision”, has been used in other documents, including in pages from workbooks Edlin helped compile for investors like Murdoch at Holmes’ request. (Edlin testified that Holmes did the final review of the binders before they were sent out.)
During Edlin’s cross-examination, Holmes’ attorney mentioned instances where Holmes herself rejected language, such as an email where she says not to use the word “unmatched” to describe precision “as we have discussed on several occasions”. Asked by the prosecution if attorneys reviewed documents shared with investors, Edlin said he was not aware of what was going on.

Questionable tech demos for VIP guests

Edlin’s testimony and emails posted in the courtroom also raised concerns about technology demonstrations Theranos has given to investors, business partners, board members and other VIP guests.

He said the company sometimes used a “demo app” to “protect” vision device errors as well as a “null protocol” that would not attempt to analyze samples. According to emails, there have been instances where Theranos removed results or changed references to demo test results before passing them on to individuals, including with a group of Walgreens executives ahead of the mainstream launch. in 2013.

During cross-examination, Holmes’ attorney Kevin Downey pointed out that these tools could be used, for example, to greet guests who might not want to have blood drawn but want to see the device work. Downey asked Edlin if the intention was to deceive someone through the demonstration process, to which he testified, “Of course not.”

Later, prosecutor John Bostic pressed the issue again, asking Edlin if part of the purpose of the protests was to “show technology works?” Edlin confirmed. Bostic then asked what would be the purpose of hiding errors. Edlin testified, “I don’t know.”

Last week, Edlin said Holmes occasionally asked him to make changes before tours, including hiding areas of his research and development lab from important visitors and sometimes using partitions to conceal areas where they were. Theranos devices.

Pfizer scientist says he did not approve Theranos technology

A former Pfizer scientist tasked with evaluating Theranos in late 2008 said on Friday morning that he had recommended the pharmaceutical company not to invest or pour resources into the startup.

Dr Shane Weber, who worked at Pfizer from 2008 to 2014 as director of diagnostics and is now retired, wrote in his internal report that “Theranos currently has no diagnostic or clinical interest in Pfizer”.

He said his determination was based on a review of a Theranos study, patent information, as well as a one-hour conference call and written follow-up questions sent to the company.

In his assessment, he said he found Holmes “distracting” and provided “evasive uninformative answers” to his due diligence questions on the call.

Weber said his findings were accepted within Pfizer and that he spoke to Holmes to let him know the company would not be working with Theranos. In an internal email after his conversation with Holmes, he explained to the others that he was “polite, clear, crisp and patiently firm as she pushed back. She asked Pfizer for other names to approach and I politely deviated. “

Over a year later, however, Theranos sent Walgreens a version of the study Weber had reviewed with the Pfizer logo on it in an attempt to present it as a validation of the startup’s technology. Weber testified that he came to the opposite conclusion.

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