Blood-testing company Theranos will dissolve, pay creditors

Elizabeth Holmes founded now-embattled Theranos in 2003

Theranos hit its commercial peak in 2013-14, amassing a $10 billion (£7.7 billion) valuation.

The announcement of the closure comes almost three months after Theranos founder Holmes and Chief Operating Officer Ramesh Balwani were charged with criminal fraud.

Theranos Inc., the Silicon Valley blood-testing company accused of defrauding investors, will formally dissolve, The Wall Street Journal reported Wednesday.

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Prosecutors say they engaged in a multi-million dollar scheme to defraud investors, doctors and patients. "We are now out of time", Taylor wrote.

The turning point then came in October 2015, when investigative reporter John Carreyrou of The Wall Street Journal questioned the validity of Theranos' technology.

Holmes founded the company in 2003 to develop technology that she claimed was able to conduct clinical tests on small amounts of blood.

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The last working day was the 31st of August and the present CEO David Taylor and other supporting staffs shall be at the office for a few more days until the company completely dissolves.

As Ars reported previously, in March 2018, the Securities and Exchange Commission filed civil charges against Holmes, Balwani, and Theranos, alleging that they had committed "massive fraud". At one time, Holmes was the youngest self-made female billionaire. After years of scandal and failed attempts to sell the company, its cash dipped too low, according to a $65 million loan agreement with Fortress Investment Group, which is entitled to foreclose on the company's assets.

With little choice left, Taylor said they have begun new negotiations with Fortress, under which Fortress would take ownership of Theranos' interests but relinquish its rights to the company's remaining cash.

Theranos, which purported to have invented a line of blood-testing machines capable of running complicated tests on just a single finger prick of blood, was in reality a fraud on a staggering scale.

The gizmo that the company invented to collect the blood samples, the "nanotainer", would be sent to Theranos's own laboratories. Holmes settled with the SEC, agreeing to pay $500,000 in fines and penalties.

Investors poured almost $1 billion into Theranos and three former USA cabinet secretaries, two former United States senators, a retired admiral and a retired Marine Corps general joined its board.

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