Walgreens managers also grew increasingly frustrated in recent weeks with Theranos as they sought information about the extent of test reports it had corrected or voided.
This seems to be a common thread in the stories I've read about Theranos, an almost pathological inability to provide basic information upon request. I can only guess that Holmes' notion of open and transparent communication is defined very differently from what most people would consider it to mean.
A big warning sign to me is also the bizarre collection of company reviews on Glassdoor [1]. It's really fascinating to me that anybody would even consider turfing their own company's reviews with this kind of ham fisted, single voice corporate speak nonsense. I wonder who inside the company is responsible for writing all of these? Holmes herself? Regardless, it's a really fascinating look into how Holmes has prioritized things.
Advice to Management
You are doing a good job. Stay in better touch with the
employees. I think most people do feel appreciated but
there are also some that are disgruntled and unhappy for
other reasons. I see these people spreading negative energy.
You should seek them and try and fix the problem.
Is it common practice among upstart companies to pad their reviews on glassdoor. I've been using those as references for my job search, I know better now.
My old job made us write positive reviews on company time. Basically anywhere that says, "keep doing what you are doing" as the advice to management and/or the reviews are ALL either 1 star or 5 star reviews, you know they are fake.
> I've been using those as references for my job search, I know better now.
Eh, that just means you can't take the reviews at face value. Ignore the obviously disgruntled employees, treat fluff reviews as a small yellow flag, and look for the real dirt not so much in the angry reviews but in the disappointed ones.
Well that plus I've had two separate situations where I left a negative review and was threatened until I took it down. Not sure you're going to see many unbiased views there...
It'd be great if someone collated the data for the reviews and pointed out which companies tend to have the most "fake" reviews. It'd be a bit difficult to do so, but I can think of at least a few ways to try (date and frequency of reviews, "corporate speak," median length of reviews, distribution of "stars", distribution "helpfulness", writing style analysis, etc.)
Glassdoor reviews are still helpful - you just have to take the averages with a grain of salt, and filter any that seem to have been written by a PR flack.
All those Glassdoors reviews talking about long hours of work, working late, and for what? What did all those people work those long hours for? For complete failure. Theranos is in shambles, and these people signed up to work and work late at a company that was a fraud. Requiring employees to work late, or to strongly encourage that kind of behavior is a huge red flag for me when looking for work. People wasted hours of their life at this place, away from family and friends and personal time, all for Theranos, a name that's a joke now.
Easy to say with hindsight. What if it would have worked out and their tech had revolutionised medical testing?
Failures are as important as successes, and nothing to be ashamed about from the employee perspective, just the covering up by management that's the problem.
Astroturfing Glassfoor should be considered fraud. It's giving information to potential employees while omitting material information (that the company is the oposter) for purposes which financially benefit the company and its backers.
I dunno, it seems pretty transparent it's bullshit. If I read stuff like this it's obviously signaling a toxic work culture full of company koolaid. I never drink the koolaid. I try to do a good job and work hard, but I never get into company culture stupidity. It's not in my nature.
True - it's deceitful and spreading misinformation.
This is tangental, but I also think that posting open job positions online when there isn't one should be considered fraud as well. Same with recruiters who do the bait and switch. People invest time from their lives into those, only to result as a record in a database somewhere when there was never any intention to hire.
Who would have regulatory oversight on this one? Fake Yelp and Amazon reviews go to the FTC and State Attorney Generals (Who could do a far better job.)
Another startling Glassdoor review that seems planted by the company:
'Cons
Not a con, more of a note -
It is a start up environment, which means that it is very fast and dynamic. It calls for a lot of hard work and creativity. Theranos is not for someone who is set in his or her ways, or for someone who is simply looking for a 9-5.'
"Pros
A pay check that clears the bank. A front row seat and education how to adulterate documents and strategy! Working on my CV on company tine..."[1]
Pretty typical. A lot of startups that are going down the tube (or were always awful) end up with horrible reviews on glassdoor. That makes it harder for their recruiters to do their job, so they pad it with extremely obvious fake reviews to compensate.
"In recent weeks, Walgreens also was named as a co-defendant in one of three civil lawsuits filed by consumers against Theranos. The suits, which seek class-action status, allege that Theranos misled the public about the nature and accuracy of its blood-testing technology."
Walgreens had an official partnership, including an investment of $50m, into Theranos.
If there is actual consumer damage shown its Walgreens that's going to find themselves writing checks to tort classes and attorneys.
In the entire WSJ expose it sounded like Walgreens management was as snowed-over as the rest of us with regard to Theranos' "technology" but it's crazy that they didn't do more relatively simple due diligence given their exposure
Who's writing the checks really depends on what's in the contract between Walgreens and Theranos. I haven't seen it, but it wouldn't be out of the ordinary for Theranos to have agreed to indemnify Walgreens against claims over the accuracy of the tests. If so, Theranos would be on the hook even if Walgreens is getting sued as well, and the real question is how big the claims are and whether they will be enough to to bankrupt Theranos.
In this case I believe that the contract was very tilted towards Theranos. The execs in charge were forced out previously. [0] I don't know any specifics on indemnification though, but if Theranos goes under, they can't indemnify much.
Well yes and no. Remember that they have a really well connected board of directors and a lot of people put their reputation out there based on information they believed to be true. The managers at Walgreens don't know how to design, validate, and certify laboratory tests and procedures so they are kind of at the mercy of the folks who tell them they do. And while it would have been within their rights to send an outside pathologist on site to audit the entire workflow, to come up with that idea you have to at least suspect that they might be trying to pull a fast one on you.
I speak from experience when I say that it is easy to be fooled into believing people when those people actually believe they are telling the truth.
Bottom line is this is all on Theranos, and not Walgreens.
Then Walgreens should fail and come to be replaced by a pharmacy chain which one way or another depends on input from a competent pharmacist (whether they are equivalent of "CTO", or board of pharmacist advisors, or whatever works).
But according to a very relevant ArsTechnica article[0], they thought to do due diligence, failed to do so, and then in a fit of unicorn mania did the deals anyway:
Theranos failed to hand over an Edison to researchers hired by Walgreens to kick the tires and ensure it worked correctly, despite initially agreeing to do so. The young company, initially valued at $9 billion, didn’t even allow Walgreens executives to enter its lab or walk around the company’s headquarters without a chaperone, the WSJ reports.
Theranos did provide an Edison prototype and sample testing kits to a Walgreens executive. But the machine only spit out test results such as “low” and “high” so that Walgreens couldn’t compare the results to standard blood testing equipment. Nevertheless, Walgreens moved forward with a deal, partly out of anxiety that Theranos might partner with a competitor.
It's still surprising that it was possible at all to start doing this without some proof of work. There are better checks and balances for something as mundane as selling lettuce or holding money deposits; why not blood testing?
The board of directors should have someone with sufficient background and subject matter expertise to be able to read the description of a technology the board is considering and say, "wait a minute, this sounds too good to be true." That should trigger due diligence, which can involve, among other things, sending an outside party to audit Theranos.
The fact that Walgreens has no such person on their board is their failing, in my opinion.
>The managers at Walgreens don't know how to design, validate, and certify laboratory tests and procedures
This is why the current company system is a bad idea. It puts incompetent idiots in charge.
This is almost literally the definition of an epic failure. If you're running a health company and someone shows up on your doorstep with some unusual claims about their product, are you going to pay someone to do some independent checking, or are you just going to rely on social proof and the fact that the marketing person seems okay?
Making management decisions on the basis of status and social proof - and that includes the VC scene - is the opposite of collective intelligence.
How many of us could name the current or former Walgreens CEO?
I've seen a certain mentality in people, including managers in the more "boring" companies in our economy. Silicon Valey companies are glamorous. There's a certain star mentality about it. Silicon Valley is in the news, the founders are rock stars.
I think the management of "boring" companies is as star struck as the rest of us are. They shouldn't be- they run huge companies employing many people, doing complex things and making profits. In this case, the star power blinded them and they'll pay a large price.
Stefano Pessina. One of the most impressive European entrepreneurs. And he's CEO because the pre-existing management, who got them into this mess, were terrible.
Anyone happen to know why this took so long to become official?
EDIT: Looks like it's mentioned a few paragraphs into the article:
Walgreens leaders decided to end the partnership after regulators disclosed problems at Theranos in late January, but held off on finalizing the separation because the company feared Theranos might sue, said people familiar with the matter.
Not quite - Walgreens believes that the CMS punishment, which is expected in the next two weeks, will be sufficiently harsh enough that it will win a case against Theranos. If they lost the case, they could have potentially been on the hook for hundreds of millions or even billions of dollars in damages (i.e. so much money that even with the incredibly bad press of not severing the deal sooner, it still made more sense to keep the deal until things got to where they are now).
Quality and safety are our top priorities and we are
working closely with government officials to ensure that
we not only comply with all federal regulations but
exceed them. We are disappointed that Walgreens has
chosen to terminate our relationship and remain fully
committed to our mission to provide patients access to
affordable health information and look forward to
continuing to serve customers in Arizona and California
through our independent retail locations.
Are the tests just completely worthless? I thought the FDA or such would mandate a battery of studies to determine whether the tests were accurate before letting someone sell them.
The fact that a major chain was selling them also seemed to indicate to me that there was something real in Theranos. Probably a lot of people think the same way, and are disappointed.
No, the regulatory system is actually doing its job. The regulatory system is predicated on the government not being all knowing and all seeing and private actors in the industry having a bit of sense and doing their own due diligence. To structure it otherwise would basically make it impossible for any health tech startup to get off the ground -- the time required, and the capital requirements would be insane.
To summarize regulatory action:
Theranos sent in a marketing application to FDA for one of the use of Edison with one test, FDA said OK, this looks good based on the data you sent us (FDA can only see what you send them). FDA then placed Theranos on an audit list (common practice for any new company), stopped by after a few months, and found out that Theranos' own internal procedures for making sure that the data they generate about their product's performance is honest were, shall we say, poor. They also found Theranos marketing other components that they had not sought clearance to market from FDA. So FDA issued a 483 (deficiency notice) and the fallout from that we have yet to see. (I personally think there will be another shoe to drop here.)
Now, on the lab side, which is regulated by the Center for Medicare and Medicaid Systems, not FDA, the process is different. Basically CMS allows you to get a preliminary certificate after a cursory inspection and gives you 2 years within which to build a real testing process and get your shit together before they do the real audit. Theranos's Bay Area lab got the preliminary certificate and massively failed the real audit, and then massively failed to fix anything, which is what's landing Holmes in potentially very hot water (being banned from the diagnostic industry for two years in the US). The reason this is structured this way is that 1) to have enough data for a meaningful audit takes time and 2) the government expects anyone contracting with a brand new lab for the first two years to understand that it's a brand new lab and act accordingly (i.e. be skeptical, do your own audit, don't take NewCo's evidence at face value).
Most people in the industry understand this. Hell, most people at Walgreens understood this and were properly skeptical [1]. But the top execs at the time overrode the valid concerns of their QC people in order to chase the unicorn.
Man I've gotta say that despite all the bad news this really bums me out. I love being able to run down to Walgreens, order my own blood tests, and get the results without a doctor or a big hassle.
I can make it even more convenient - get out a couple of dice and roll them across your desk. If the total is under 7 you are ok otherwise go to the doctor for some competently run test.
Readit News
This seems to be a common thread in the stories I've read about Theranos, an almost pathological inability to provide basic information upon request. I can only guess that Holmes' notion of open and transparent communication is defined very differently from what most people would consider it to mean.
A big warning sign to me is also the bizarre collection of company reviews on Glassdoor [1]. It's really fascinating to me that anybody would even consider turfing their own company's reviews with this kind of ham fisted, single voice corporate speak nonsense. I wonder who inside the company is responsible for writing all of these? Holmes herself? Regardless, it's a really fascinating look into how Holmes has prioritized things.
1 - https://www.glassdoor.com/Reviews/Theranos-Reviews-E248889.h...
https://www.glassdoor.com/Reviews/Employee-Review-Theranos-R...
Is it common practice among upstart companies to pad their reviews on glassdoor. I've been using those as references for my job search, I know better now.> Everyday brings new challenges, and you are able to approach these challenges with autonomy and creativity.
gets Helpful (1) and
>"House of Cards comes crashing down"
...A front row seat and education how to adulterate documents and strategy!
gets Helpful (76)
Eh, that just means you can't take the reviews at face value. Ignore the obviously disgruntled employees, treat fluff reviews as a small yellow flag, and look for the real dirt not so much in the angry reviews but in the disappointed ones.
Failures are as important as successes, and nothing to be ashamed about from the employee perspective, just the covering up by management that's the problem.
This is tangental, but I also think that posting open job positions online when there isn't one should be considered fraud as well. Same with recruiters who do the bait and switch. People invest time from their lives into those, only to result as a record in a database somewhere when there was never any intention to hire.
'Cons Not a con, more of a note -
It is a start up environment, which means that it is very fast and dynamic. It calls for a lot of hard work and creativity. Theranos is not for someone who is set in his or her ways, or for someone who is simply looking for a 9-5.'
[1] https://www.glassdoor.com/Reviews/Employee-Review-Theranos-R...
Deleted Comment
Hey - someone can do some NLP work to estimate number of authors, right?
Facepalm.
Walgreens had an official partnership, including an investment of $50m, into Theranos.
If there is actual consumer damage shown its Walgreens that's going to find themselves writing checks to tort classes and attorneys.
In the entire WSJ expose it sounded like Walgreens management was as snowed-over as the rest of us with regard to Theranos' "technology" but it's crazy that they didn't do more relatively simple due diligence given their exposure
[0] http://www.nytimes.com/2016/04/22/business/a-once-avid-ally-...
I speak from experience when I say that it is easy to be fooled into believing people when those people actually believe they are telling the truth.
Bottom line is this is all on Theranos, and not Walgreens.
But according to a very relevant ArsTechnica article[0], they thought to do due diligence, failed to do so, and then in a fit of unicorn mania did the deals anyway:
Theranos failed to hand over an Edison to researchers hired by Walgreens to kick the tires and ensure it worked correctly, despite initially agreeing to do so. The young company, initially valued at $9 billion, didn’t even allow Walgreens executives to enter its lab or walk around the company’s headquarters without a chaperone, the WSJ reports.
Theranos did provide an Edison prototype and sample testing kits to a Walgreens executive. But the machine only spit out test results such as “low” and “high” so that Walgreens couldn’t compare the results to standard blood testing equipment. Nevertheless, Walgreens moved forward with a deal, partly out of anxiety that Theranos might partner with a competitor.
[0]: http://arstechnica.com/science/2016/05/walgreens-failed-to-v...
The fact that Walgreens has no such person on their board is their failing, in my opinion.
This is why the current company system is a bad idea. It puts incompetent idiots in charge.
This is almost literally the definition of an epic failure. If you're running a health company and someone shows up on your doorstep with some unusual claims about their product, are you going to pay someone to do some independent checking, or are you just going to rely on social proof and the fact that the marketing person seems okay?
Making management decisions on the basis of status and social proof - and that includes the VC scene - is the opposite of collective intelligence.
I've seen a certain mentality in people, including managers in the more "boring" companies in our economy. Silicon Valey companies are glamorous. There's a certain star mentality about it. Silicon Valley is in the news, the founders are rock stars.
I think the management of "boring" companies is as star struck as the rest of us are. They shouldn't be- they run huge companies employing many people, doing complex things and making profits. In this case, the star power blinded them and they'll pay a large price.
Look at the turnover in the Fortune 500: http://www.wired.com/2012/06/fortune-500-turnover-and-its-me...
Dead Comment
EDIT: Looks like it's mentioned a few paragraphs into the article:
Walgreens leaders decided to end the partnership after regulators disclosed problems at Theranos in late January, but held off on finalizing the separation because the company feared Theranos might sue, said people familiar with the matter.
https://twitter.com/joshdickson40/status/742154076851408898
https://theranos.com/news/posts/statement-from-theranos-7
The fact that a major chain was selling them also seemed to indicate to me that there was something real in Theranos. Probably a lot of people think the same way, and are disappointed.
To summarize regulatory action:
Theranos sent in a marketing application to FDA for one of the use of Edison with one test, FDA said OK, this looks good based on the data you sent us (FDA can only see what you send them). FDA then placed Theranos on an audit list (common practice for any new company), stopped by after a few months, and found out that Theranos' own internal procedures for making sure that the data they generate about their product's performance is honest were, shall we say, poor. They also found Theranos marketing other components that they had not sought clearance to market from FDA. So FDA issued a 483 (deficiency notice) and the fallout from that we have yet to see. (I personally think there will be another shoe to drop here.)
Now, on the lab side, which is regulated by the Center for Medicare and Medicaid Systems, not FDA, the process is different. Basically CMS allows you to get a preliminary certificate after a cursory inspection and gives you 2 years within which to build a real testing process and get your shit together before they do the real audit. Theranos's Bay Area lab got the preliminary certificate and massively failed the real audit, and then massively failed to fix anything, which is what's landing Holmes in potentially very hot water (being banned from the diagnostic industry for two years in the US). The reason this is structured this way is that 1) to have enough data for a meaningful audit takes time and 2) the government expects anyone contracting with a brand new lab for the first two years to understand that it's a brand new lab and act accordingly (i.e. be skeptical, do your own audit, don't take NewCo's evidence at face value).
Most people in the industry understand this. Hell, most people at Walgreens understood this and were properly skeptical [1]. But the top execs at the time overrode the valid concerns of their QC people in order to chase the unicorn.
[1] http://www.wsj.com/articles/craving-growth-walgreens-dismiss...
Sad that it did not come true.
Dead Comment