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Kunjungi www.Markasjudi.com
Agen Judi Online Aman dan Terpercaya

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We've had a great opportunity

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in asking so many people
so many questions

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about things ranging from the future to,
kind of, advice,

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and we thought
we'd ask a few questions

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that run a little bit
of a gamut, really quickly.

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- Mm. Okay.
- Can you look into the lens?

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We thought it would
be interesting to ask you,

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in the year 2025,

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what's the thing
you're most certain about?

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More people will have access
to their own health information.

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What do you dream for?
Something in 2025?

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That less people
have to say goodbye too soon

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to people they love.

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That's great.
Can you tell us a secret?

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I don't have many secrets. Um...

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Are you a scientist or a technologist?

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Or an entrepreneur?

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I think I'm an entrepreneur.

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I was trained as an engineer,

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but... now my time is spent

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on doing whatever it takes
to realize this mission.

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Theranos is the integration

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of the words
therapy and diagnosis.

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And if we can shift
toward a model in which

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we're determining
the onset of disease

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in time for therapy
to be effective,

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we will change outcomes.

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You founded this company
12 years ago, right?

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Tell 'em how old you were.

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- I was 19.
- Yeah.

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There was never sort of a plan

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to drop out of Stanford,
but I found what I loved.

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I found what I wanted
to spend my life doing.

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Elizabeth has raised more than $400 million.

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The company is
valued at $9 billion.

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You own over 50% of it, right?

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Congratulations on that.

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We've got an incredible
opportunity to try to uphold

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a legacy in Silicon Valley
of changing the world.

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And we like to think
about it as a movie,

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and you can begin to see
that story in a better way.

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We see a world
in which every person

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has access

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to actionable health information

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at the time
it matters.

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A world
in which

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no one ever
has to say,

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"If only I'd known sooner."

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A world in which

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no one ever has
to say goodbye too soon.

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This future

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is beginning now.

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Nestled in the
foothills above Silicon Valley,

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there is a 700-acre
plot of land

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called
the Stanford Research Park.

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According to the website,
it's a community of and for people

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who seek to invent the future.

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From here came elements
of the microwave tube,

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the mainframe computer,
and the International Space Station.

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Steve Jobs spent time here,

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so did Mark Zuckerberg
and Elon Musk.

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Elizabeth Holmes saw
herself in their company.

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So in the fall of 2014,
she moved her biotech startup

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Theranos to the research park.

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The company
employed 800 people

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and was valued
at nearly $10 billion.

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Four years later,
it was worth less than zero.

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To understand what happened,

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it pays to look past
the price of the stock

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to the value of the story.

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This compelling tale of divining hundreds
of diseases from a drop of blood

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was a testament to the
imagination of the inventor.

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In the deserted
property she designed,

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you can almost hear
the echoes of her ambition

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and see how glass walls,
promising transparency,

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could become
a labyrinth of mirrors.

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Was Elizabeth lost
in a landscape

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between what
she could make real

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and the world
of make-believe?

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For me,
this was a story of how people get trapped

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over time with trading off
human values.

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And then, the way that
they trade off those values

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change them as people
and things go down.

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So part of it was
trying to understand...

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and I think this is
part of the story...

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is the journey
for Elizabeth.

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Some people take a path,

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trying to do positive things
for the world, right?

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Nobody questions
that her motives were...

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were positive, but end up
being something bad.

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How do we react to this?

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You can look
at her at the end,

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and say how could
she do this,

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but I think that
would miss the point

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if you don't understand
the journey.

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If you look at her
from the beginning,

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it will be a cautionary
tale about all of us.

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I grew up spending summers

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and the holidays with my uncle.

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I remember how much
he loved the beach.

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I remember
how much I loved him.

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He was diagnosed
one day with skin cancer,

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which all of a sudden
was brain cancer,

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and in his bones.

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He didn't live
to see his son grow up,

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and I never got to say goodbye.

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The right to protect
the health and well-being

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of every person,
of those we love,

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is a basic human right.

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Over the course
of the last 11 years,

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we've made it possible to run

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comprehensive laboratory tests

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from a few drops of blood

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that could be taken
from a finger.

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And we've made it possible

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to eliminate the tubes
and tubes of blood

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that traditionally have
to be drawn from an arm,

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and replaced it
with the nanotainer.

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And if I had one wish,

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standing here with all of you,

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it would be that no one
has to go through the pain

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of traditional phlebotomy.

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I was always...

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absolutely terrified
of giving blood.

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It's the only thing in my life
I've ever been scared of.

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If we were to sit here and
dream up torture experiments,

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psychologically, the concept
of sticking large needles

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over and over into someone,

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and draining out so much blood,

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while they're watching this
blood being sucked out of them,

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that you've basically
completely debilitated them,

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that qualifies as a pretty good
torture experiment in my book.

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I find it quite disturbing.

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This technician is preparing the blood sample

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for a white cell count.

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She dilutes the blood
with a special fluid

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and puts a measured amount
into a pipette.

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Since, really,
the clinical lab infrastructure

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began to develop, we've had
this highly centralized,

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very big,
analytical instruments

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which require that much blood,

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and therefore, people have
had to take tubes and tubes

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every time they do
a blood draw.

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So, laboratory testing
hasn't changed since the 1950s.

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It's the closest thing
to mainframe computers versus...

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it's not even PCs...
versus mobile phones that...

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that I've ever seen, right?

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So, the timing is very ripe
to change this paradigm.

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There's no shortcut
to really hard work.

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And we learn so much more
from our failures

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than we did from our successes.

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We code-named our product
"The Edison"

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because we assumed
we'd have to fail 10,000 times

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to get it to work the 10,001st.

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And we did.

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What does it mean to invent something?

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It could be an act of creation,

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or an act of deception.

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The world's greatest
inventor did both.

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We think of Thomas Edison

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as the inventor
of the phonograph,

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the electric light bulb,
and the way we look at the world.

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Edison's company made one of the
first motion picture cameras

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and the very first commercial
movie, Blacksmithing Scene.

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His company produced
over 1,200 films,

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documentaries
and fiction films,

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including
the first screen kiss.

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But Edison's greatest invention
may have been himself.

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The first celebrity
businessman,

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Edison's secret was knowing
how to tell a good story,

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in which he cast himself
as the main character.

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"The Wizard of Menlo Park,"

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a man who could conjure
anything in his laboratory.

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He had his name
on over 2,000 patents,

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from telegraphs to vacuum pumps

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to electric cars.

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But he often promised
far more than he could deliver.

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In 1878, the New York Sun
printed a claim by Edison

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that he had solved the mystery
of the incandescent light bulb.

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But it wasn't true.

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His filaments kept melting.

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When reporters and investors

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asked for demonstrations,
he faked them.

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To keep journalists
sympathetic,

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he gave them stock
in his company.

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For four years, he pretended
his invention was good to go,

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even while he scrambled
to make it work.

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Then, just before his money
and credit ran out,

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he solved the problem
of how to keep the lights on.

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He was the first to practice
the Silicon Valley art

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of "fake it till you make it."

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More than a hundred years
after Edison's first movies,

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Elizabeth Holmes modeled
her own ambitious career

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after the great
American inventor,

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with a magical machine
named after the man himself.

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It was obviously such an incredible story.

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The 19-year-old, the dropout,

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a woman creating
this $9 billion

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innovative company.

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I went out there for four days:

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three interviewing her and one
interviewing some other people.

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What are
you working on?

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When she was talking about some subject

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other than diagnostic testing,

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she was very unprepossessing,

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very ingenuous.

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When she began to talk about...

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the mission,
or the, you know, her business,

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then there was a shift,

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and she became very,
very focused, very intense.

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Firm control of all the facts.

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No question surprised her.

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Um... very impressive,
and very idealistic.

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We were the first to put on the cover

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and write a major story about
this amazing woman next to me.

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"This CEO Is
Out for Blood."

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This is Elizabeth's second

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public live interview...

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Fortune invited her to the
Most Powerful Women's conference,

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even though she wasn't the head
of a Fortune 500 company.

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And she was saying to us,

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"I'm the only one of these
people that founded a company."

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You know, "They're CEOs,

224
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"yeah, but I founded
this company.

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"I invented
what this company is about.

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I deserve to be here."

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I'll talk with people
sometimes, they'll say,

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"Oh, you know,
I want to start a business."

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And my question is always why,

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because there's
gotta be a mission.

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I had heard about Theranos

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and Elizabeth Holmes,
a woman executive

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in the male-dominated
Silicon Valley,

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who was starting a company

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with some real
potential social good.

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I write a lot
about disruption,

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and Theranos was
aimed to be a disruptor

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of the established
ways of doing things,

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the established, inefficient,

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and expensive ways
of doing things.

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And she was going to herald

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a revolution in medical
treatment in this country.

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The lab industry needed disrupting.

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It was dominated
by two companies:

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Quest and LabCorp.

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Between them, they controlled
almost 80% of the market.

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Their blood test prices were
always high and never transparent.

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They were sued for overcharging
Medicaid and Medicare

249
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for billions of dollars.

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00:15:10,959 --> 00:15:12,667
But the size
of their operations,

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including the ability to do over
a thousand different blood tests,

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made them difficult
to challenge.

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00:15:18,583 --> 00:15:21,667
Until Elizabeth Holmes
and Edison.

254
00:15:23,000 --> 00:15:26,083
She had built a staff of 700 people.

255
00:15:26,166 --> 00:15:30,041
Well, I went out to look at the Newark,
California, facility,

256
00:15:30,125 --> 00:15:32,625
which was extraordinary.

257
00:15:47,917 --> 00:15:50,834
Well, you know,
her story's so compelling.

258
00:15:50,917 --> 00:15:54,542
I mean, if you think about it,
you go in and you see

259
00:15:54,625 --> 00:15:56,417
this woman lives
in an apartment...

260
00:15:56,500 --> 00:15:59,291
basically, she called
her apartment a mattress.

261
00:15:59,375 --> 00:16:01,750
The only thing in the
refrigerator was bottled water.

262
00:16:01,834 --> 00:16:03,625
She ate all the meals
at the office.

263
00:16:03,709 --> 00:16:05,083
She slept four hours a day.

264
00:16:05,166 --> 00:16:08,250
She worked in the office
till midnight or thereabouts.

265
00:16:08,333 --> 00:16:11,125
You ask, do you date?
"No, I don't have ti...

266
00:16:11,208 --> 00:16:13,041
I'm married to Theranos."

267
00:16:13,125 --> 00:16:15,125
That was her...
that's literally her words,

268
00:16:15,208 --> 00:16:16,959
what she said to me,
and I believed it.

269
00:16:18,542 --> 00:16:22,250
You wear black outfits a lot.
Why?

270
00:16:22,333 --> 00:16:25,291
Because in line with the...

271
00:16:25,375 --> 00:16:27,458
designing my life
to be able to give

272
00:16:27,542 --> 00:16:30,000
every bit of energy
I have to this,

273
00:16:30,083 --> 00:16:33,125
I have a closet that
has a very large number

274
00:16:33,208 --> 00:16:35,417
of the exact same
set of clothes,

275
00:16:35,500 --> 00:16:37,000
and every single day,

276
00:16:37,083 --> 00:16:39,750
I put the same thing on,
and I don't have to think about it.

277
00:16:39,834 --> 00:16:42,208
Steve Jobs used to say that, too.

278
00:16:43,375 --> 00:16:45,208
He wore jeans.

279
00:16:46,959 --> 00:16:48,417
She was obviously, you know,

280
00:16:48,500 --> 00:16:50,291
Steve Jobs was her hero.

281
00:16:50,375 --> 00:16:52,458
And I just felt,
oh, well, she's a young person.

282
00:16:52,542 --> 00:16:57,750
You know, I'll give them their
little hero worship thing.

283
00:16:58,959 --> 00:17:02,959
I'm a tremendous admirer of what Jobs did.

284
00:17:03,041 --> 00:17:05,000
I think he was a genius.

285
00:17:05,083 --> 00:17:06,667
I do have to disclose that

286
00:17:06,750 --> 00:17:09,291
I've been in black turtlenecks
since I was seven.

287
00:17:24,041 --> 00:17:26,417
I want to talk for just a minute about

288
00:17:26,500 --> 00:17:28,875
what it means to be
in this company right now.

289
00:17:28,959 --> 00:17:35,542
I was sitting yesterday with the
president of Brazil for lunch,

290
00:17:35,625 --> 00:17:39,166
and this woman had invited me,

291
00:17:39,250 --> 00:17:42,667
and Eric Schmidt from Google,
and Mark Zuckerberg,

292
00:17:42,750 --> 00:17:46,458
and the Airbnb guys, and the Uber guys,
and a bunch of other people,

293
00:17:46,542 --> 00:17:50,041
and she sits down at the table
with all these people,

294
00:17:50,125 --> 00:17:53,083
and we all have
the headphones on, translators,

295
00:17:53,166 --> 00:17:57,542
and she says, "The strategic
priority of Brazil

296
00:17:57,625 --> 00:18:00,500
"is to get access
to low cost diagnostics

297
00:18:00,583 --> 00:18:02,792
"that can facilitate
early detection

298
00:18:02,875 --> 00:18:05,583
and prevention and..."

299
00:18:09,709 --> 00:18:12,125
We're all kind of sitting there,
and you can see, like,

300
00:18:12,208 --> 00:18:15,250
all the other CEOs' faces
being like...

301
00:18:15,333 --> 00:18:18,166
not wanting to be
the ones in the spotlight,

302
00:18:18,250 --> 00:18:20,309
and she kept on doing this
for like an hour and a half.

303
00:18:20,333 --> 00:18:23,750
And so, of course, I'm trying
to, you know, be humble,

304
00:18:23,834 --> 00:18:25,792
but I'm...

305
00:18:25,875 --> 00:18:27,417
When I first met her,

306
00:18:27,500 --> 00:18:29,083
I thought she was
really interesting.

307
00:18:29,166 --> 00:18:32,750
It was... It was hard to really
get a sense of who she was,

308
00:18:32,834 --> 00:18:36,750
but in a way,
I felt I idolized her in so many ways,

309
00:18:36,834 --> 00:18:39,166
based on, like,
the little that I had read.

310
00:18:39,250 --> 00:18:41,417
Nice to meet you.
I'm Elizabeth.

311
00:18:41,500 --> 00:18:43,792
For being a woman in the sciences,

312
00:18:43,875 --> 00:18:45,417
being a woman in tech,

313
00:18:45,500 --> 00:18:48,000
the fact that she started
her own company,

314
00:18:48,083 --> 00:18:50,375
that really got me excited.

315
00:18:50,458 --> 00:18:53,291
You know, she was
a really good idol to have.

316
00:18:53,375 --> 00:18:54,625
Thank you so much.

317
00:18:54,709 --> 00:18:56,875
In a sense,
I was super naive and like,

318
00:18:56,959 --> 00:18:59,959
almost drank the Kool-Aid,
like, a little too quickly,

319
00:19:00,041 --> 00:19:03,834
and was just more enthusiastic
to be a part of the team.

320
00:19:03,917 --> 00:19:05,834
You all are part of something

321
00:19:05,917 --> 00:19:08,583
that is a revolution,
and you're part of something

322
00:19:08,667 --> 00:19:11,166
that is going to change
our world.

323
00:19:12,041 --> 00:19:14,417
What higher purpose
is there in life

324
00:19:14,500 --> 00:19:16,375
than to be able
to be doing that?

325
00:19:22,542 --> 00:19:24,500
When I went on an interview,

326
00:19:24,583 --> 00:19:26,125
Elizabeth was there.

327
00:19:26,208 --> 00:19:27,834
And I was
a little surprised,

328
00:19:27,917 --> 00:19:31,041
considering I would be the
low man on the totem pole.

329
00:19:31,750 --> 00:19:33,875
I found out later
there was no one

330
00:19:33,959 --> 00:19:36,333
that got past her
in order to get hired.

331
00:19:36,417 --> 00:19:38,959
Um...

332
00:19:39,041 --> 00:19:42,834
I know this sounds odd,
but my first impression was

333
00:19:42,917 --> 00:19:44,917
that she didn't blink.

334
00:19:47,417 --> 00:19:50,083
And so, I always wanted
to make sure that I kept

335
00:19:50,166 --> 00:19:52,875
great eye contact 'cause
I didn't want to be the one

336
00:19:52,959 --> 00:19:55,542
to look over, right?

337
00:19:55,625 --> 00:19:58,458
Uh, so, she was very intense.

338
00:20:04,959 --> 00:20:07,059
Comparing it to
the other interviews that I had

339
00:20:07,083 --> 00:20:10,375
with other tech companies in the Bay Area,
it was different.

340
00:20:10,458 --> 00:20:15,125
You know, they didn't tell me nearly
as much about what they were doing.

341
00:20:15,208 --> 00:20:17,458
She never blinked
during the interview.

342
00:20:18,792 --> 00:20:21,709
She did
tell me about

343
00:20:21,792 --> 00:20:23,375
just the one drop
of blood

344
00:20:23,458 --> 00:20:26,166
and it's a medical
testing company.

345
00:20:26,250 --> 00:20:29,041
Um, they didn't say anything
about how it worked,

346
00:20:29,125 --> 00:20:31,125
or what the technology was.

347
00:20:31,208 --> 00:20:35,125
They just said, "You'll be
working with consumables,"

348
00:20:35,208 --> 00:20:36,834
which was kind of vague.

349
00:20:36,917 --> 00:20:38,917
How did they describe the project?

350
00:20:39,000 --> 00:20:41,709
They didn't.

351
00:20:41,792 --> 00:20:43,712
So, how did you know what
you were signing on for?

352
00:20:43,792 --> 00:20:47,083
You know, I had a very vague idea,
but I didn't.

353
00:20:47,166 --> 00:20:50,166
That's actually not that untypical
in startup environments.

354
00:20:50,250 --> 00:20:52,000
They want to keep
what they're doing secret.

355
00:20:52,083 --> 00:20:55,166
The response
of the major lab companies

356
00:20:55,250 --> 00:20:57,166
was to say,
"Well, we don't know

357
00:20:57,250 --> 00:20:59,267
- how they're doing what they're doing." And...
- Exactly.

358
00:20:59,291 --> 00:21:00,851
And if it's so great,
why don't they show it?

359
00:21:00,875 --> 00:21:02,309
There's too much secrecy
is what they said.

360
00:21:02,333 --> 00:21:04,000
Right, that's exactly
what they said.

361
00:21:04,083 --> 00:21:06,291
And, you know, our position
on that is, first of all,

362
00:21:06,375 --> 00:21:08,417
we don't think that we need

363
00:21:08,500 --> 00:21:12,083
to explain ourselves
to competitive companies.

364
00:21:12,166 --> 00:21:16,333
What we're working to do is to
invent an integrated solution

365
00:21:16,417 --> 00:21:18,750
where every person
gets access

366
00:21:18,834 --> 00:21:23,750
to this wealth of information
from tiny droplets of blood,

367
00:21:23,834 --> 00:21:26,834
and then see
how they change over time.

368
00:21:33,166 --> 00:21:35,625
She talked some about currently,

369
00:21:35,709 --> 00:21:38,291
you get a blood test
maybe once a year,

370
00:21:38,375 --> 00:21:40,959
and so you get a snapshot
of what's going on.

371
00:21:41,041 --> 00:21:44,834
If you were to start doing it
every month, say,

372
00:21:44,917 --> 00:21:46,625
you would get a movie.

373
00:21:48,709 --> 00:21:50,709
You have multiple frames from that movie,

374
00:21:50,792 --> 00:21:52,792
and you can begin
to see the context

375
00:21:52,875 --> 00:21:55,417
of projecting where
someone is heading.

376
00:21:55,500 --> 00:21:59,875
You're seeing changes
in laboratory data over time,

377
00:21:59,959 --> 00:22:03,792
and understanding the clinical
significance of that.

378
00:22:03,875 --> 00:22:07,917
The data can be used
in a more meaningful way.

379
00:22:08,000 --> 00:22:09,500
It was personalized medicine.

380
00:22:09,583 --> 00:22:12,125
Maybe you could catch
something very early.

381
00:22:12,208 --> 00:22:13,875
You know, you could catch
an early cancer,

382
00:22:13,959 --> 00:22:17,166
or you could get... you know,
when there was still time.

383
00:22:17,250 --> 00:22:20,208
This was sort of
the vast vision.

384
00:22:20,291 --> 00:22:23,458
So,
the idea with the Edison was to stick

385
00:22:23,542 --> 00:22:26,208
the lab inside the box.

386
00:22:26,291 --> 00:22:29,000
Because it incorporates
so many different disciplines,

387
00:22:29,083 --> 00:22:30,959
it's hard to pull this off.

388
00:22:32,375 --> 00:22:34,000
There's all these
different components

389
00:22:34,083 --> 00:22:35,125
that go into the machine.

390
00:22:35,208 --> 00:22:37,542
There's a centrifuge,
there's a...

391
00:22:38,333 --> 00:22:39,917
a little thing
the samples go into.

392
00:22:40,000 --> 00:22:42,041
There's a way
to prick the blood.

393
00:22:42,125 --> 00:22:43,685
All these things were
prototypes, right?

394
00:22:43,750 --> 00:22:46,792
The first thing is,
you look at what the chemists are doing.

395
00:22:46,834 --> 00:22:48,333
- Right.
- Right?

396
00:22:48,375 --> 00:22:50,351
Because you're automating
what somebody is already doing.

397
00:22:50,375 --> 00:22:53,125
You're not inventing
something totally new.

398
00:22:56,000 --> 00:22:59,792
I'm going to have to have a kind of dance,
let's say, right?

399
00:22:59,834 --> 00:23:02,542
I'm going to have to have
this thing go to the place,

400
00:23:02,667 --> 00:23:04,750
pick up something,
drop off something,

401
00:23:04,834 --> 00:23:06,500
mix something, etcetera.

402
00:23:08,375 --> 00:23:09,834
The idea was the pipette

403
00:23:09,959 --> 00:23:12,834
poked holes into these
little plastic containers

404
00:23:12,959 --> 00:23:14,041
with reagents in them.

405
00:23:14,125 --> 00:23:16,917
It mixes some of
the reagents with blood.

406
00:23:21,458 --> 00:23:23,101
My group was responsible for developing

407
00:23:23,125 --> 00:23:24,500
about 60 different tests,

408
00:23:24,542 --> 00:23:27,166
and trying to get those
to work on the Edisons.

409
00:23:27,250 --> 00:23:29,750
The trick was how do you make it dependable,

410
00:23:29,834 --> 00:23:32,333
then how do you incorporate
it into a bigger process

411
00:23:32,375 --> 00:23:34,917
that involves these
50 milliliter samples?

412
00:23:35,000 --> 00:23:36,333
It was a complex device.

413
00:23:36,458 --> 00:23:38,792
You know, a lot of moving parts,
and a complicated system.

414
00:23:38,834 --> 00:23:41,000
It's not easy to do
all this stuff, so it was...

415
00:23:41,083 --> 00:23:42,434
You know,
I figured we'd get there.

416
00:23:42,458 --> 00:23:45,250
We felt we were on the path

417
00:23:45,333 --> 00:23:47,667
to be able to make machines
that could do this.

418
00:23:58,125 --> 00:24:01,405
Elizabeth Holmes,
we're on the record unless you tell me not.

419
00:24:01,458 --> 00:24:04,458
Let me begin. When you think
about yourself as a child...

420
00:24:04,542 --> 00:24:06,250
I had multiple interviews with her,

421
00:24:06,333 --> 00:24:10,000
but one of them was to go to a
Chinese restaurant in Palo Alto.

422
00:24:10,083 --> 00:24:11,792
And it was really good food.

423
00:24:11,875 --> 00:24:15,542
I had the
blessing of being able to figure out

424
00:24:15,625 --> 00:24:17,792
what I...

425
00:24:17,875 --> 00:24:21,750
Thank you...wanted to do very early.

426
00:24:21,834 --> 00:24:25,917
And I was very interested in
the concept of creating things.

427
00:24:26,000 --> 00:24:29,750
I must've been, like, seven,
and I had a notebook

428
00:24:29,834 --> 00:24:33,166
of a complete design
for a time machine.

429
00:24:33,250 --> 00:24:35,792
It was a very detailed drawing

430
00:24:35,875 --> 00:24:38,959
of all the functionality,
in terms of the interface.

431
00:24:39,041 --> 00:24:41,333
I got really
interested in the idea

432
00:24:41,417 --> 00:24:43,583
of creating and building
something.

433
00:24:43,667 --> 00:24:46,583
But ultimately,
it became clear to me

434
00:24:46,667 --> 00:24:49,417
that the vehicle
of a business provides

435
00:24:49,500 --> 00:24:53,083
the greatest tool for being
able to affect change.

436
00:25:04,959 --> 00:25:07,291
I was very studious.

437
00:25:07,375 --> 00:25:09,542
I never really watched TV.

438
00:25:11,458 --> 00:25:14,875
As I went through school
and went through high school,

439
00:25:14,959 --> 00:25:19,083
my best friends were...
were books.

440
00:25:19,166 --> 00:25:22,125
I got into Moby Dick
and The Iliad and The Odyssey

441
00:25:22,208 --> 00:25:24,208
at a pretty young age.

442
00:25:26,041 --> 00:25:29,625
Understanding how
great people and great leaders

443
00:25:29,709 --> 00:25:31,917
led groups of people.

444
00:25:35,792 --> 00:25:39,166
So much changes in our society
technologically,

445
00:25:39,250 --> 00:25:44,208
but as humans,
we don't change a lot, you know?

446
00:25:59,000 --> 00:26:02,667
This is a high
tech atmosphere around Stanford.

447
00:26:02,750 --> 00:26:07,250
Internet, the startups,
the biotech, and medicine.

448
00:26:09,041 --> 00:26:12,000
I started on the faculty
here in 1984.

449
00:26:12,083 --> 00:26:14,000
I'm currently
a tenured professor.

450
00:26:14,083 --> 00:26:15,750
And I was on boards
of companies,

451
00:26:15,834 --> 00:26:17,500
many private
and public companies,

452
00:26:17,583 --> 00:26:19,417
and I started
a couple of companies.

453
00:26:19,500 --> 00:26:21,834
So, I tend to be sought out

454
00:26:21,917 --> 00:26:23,667
by kids who have
an interest in business.

455
00:26:23,750 --> 00:26:26,166
And people have
made fortunes.

456
00:26:26,250 --> 00:26:28,417
Students,
young people,

457
00:26:28,500 --> 00:26:30,542
turn into
multimillionaires.

458
00:26:30,625 --> 00:26:34,166
It makes for
an odd morality.

459
00:26:36,083 --> 00:26:39,166
When I was at Stanford,
I started to spend all my time

460
00:26:39,250 --> 00:26:41,750
thinking about how
you could build something

461
00:26:41,834 --> 00:26:44,792
that would change
what we know

462
00:26:44,875 --> 00:26:47,625
in terms of early detection
and prevention.

463
00:26:48,417 --> 00:26:50,792
I filed my first patent.

464
00:26:55,000 --> 00:26:57,375
One day,
Elizabeth came to me

465
00:26:57,458 --> 00:26:59,291
and she described her idea.

466
00:27:01,000 --> 00:27:03,625
She wanted to incorporate
microfluidics

467
00:27:03,709 --> 00:27:07,291
and nanotechnology
into a patch,

468
00:27:07,375 --> 00:27:09,083
where you could
sample the blood,

469
00:27:09,166 --> 00:27:11,917
and detect an infection,

470
00:27:12,000 --> 00:27:15,333
and then at that point,
deliver antibiotics through it.

471
00:27:17,375 --> 00:27:20,750
Well, you can't do that.
It's impossible, physically.

472
00:27:20,834 --> 00:27:23,041
Antibiotics are not potent.
You cannot do that.

473
00:27:23,125 --> 00:27:25,667
There's a reason you have
a big IV bag when... Okay.

474
00:27:25,750 --> 00:27:28,041
So I said,
"Elizabeth, that's fun,

475
00:27:28,125 --> 00:27:29,959
but I don't think
that's going to work."

476
00:27:32,166 --> 00:27:34,625
She was a 19-year-old.

477
00:27:34,709 --> 00:27:37,166
She never thought
she had any limits.

478
00:27:37,250 --> 00:27:39,291
She was going to conquer
the world.

479
00:27:40,125 --> 00:27:43,417
She came back twice, I think.

480
00:27:43,500 --> 00:27:45,041
And I just really...

481
00:27:45,125 --> 00:27:47,458
"I try to help students,
but I just feel I can't help you.

482
00:27:47,542 --> 00:27:49,458
"You're not listening,

483
00:27:49,542 --> 00:27:51,959
but I'll help you find
someone else to talk to."

484
00:27:55,458 --> 00:27:58,792
This used to be my advisor's office.

485
00:27:58,875 --> 00:28:00,875
We got in.

486
00:28:00,959 --> 00:28:02,643
From the very first time I met her,

487
00:28:02,667 --> 00:28:04,792
it was very clear
she was unusual.

488
00:28:04,875 --> 00:28:07,250
I've taught thousands
of students,

489
00:28:07,333 --> 00:28:09,583
probably tens of
thousands of students,

490
00:28:09,667 --> 00:28:12,125
at Stanford,
and...

491
00:28:12,208 --> 00:28:13,667
I knew right away

492
00:28:13,750 --> 00:28:18,792
that I was dealing with
something very, very different.

493
00:28:18,875 --> 00:28:21,625
Channing Robinson,
the head of the science department

494
00:28:21,709 --> 00:28:24,959
at Stanford, leaves his tenured
position to work for her?

495
00:28:25,041 --> 00:28:28,500
He just thought this
woman was something special.

496
00:28:28,583 --> 00:28:30,375
You know, gazing into her eyes,

497
00:28:30,458 --> 00:28:34,834
and realizing that he was
talking to the next...

498
00:28:34,917 --> 00:28:37,083
Steve Jobs or Bill Gates.

499
00:28:37,166 --> 00:28:39,500
There were some
other names mentioned

500
00:28:39,583 --> 00:28:42,166
during the course of our
conversation, like Archimedes.

501
00:28:44,375 --> 00:28:47,417
I actually, originally,
did not intend to drop out of Stanford,

502
00:28:47,500 --> 00:28:50,667
but I wasn't going to any classes, and so then...

503
00:28:50,750 --> 00:28:53,750
...logistically,
it just seemed like a waste of money.

504
00:28:54,917 --> 00:28:58,667
The question was, as a 19-year-old,
how do you go about the process

505
00:28:58,750 --> 00:29:01,333
of convincing people that
you know what you're doing,

506
00:29:01,417 --> 00:29:04,667
and that you can
pull it off. Um...

507
00:29:04,750 --> 00:29:06,667
I think the first
piece is realizing

508
00:29:06,750 --> 00:29:09,667
that it's not necessarily
about age, and...

509
00:29:09,750 --> 00:29:14,542
um, people, like Steve Jobs,
and Bill Gates,

510
00:29:14,625 --> 00:29:15,709
and the Google guys,

511
00:29:15,792 --> 00:29:17,917
and Michael Dell,
and Larry Ellison,

512
00:29:18,000 --> 00:29:19,750
and others,
have demonstrated that.

513
00:29:19,834 --> 00:29:22,166
You have to have the conviction

514
00:29:22,250 --> 00:29:24,709
in yourself to be able
to make something happen

515
00:29:24,792 --> 00:29:27,083
because, ultimately,
it's up to you.

516
00:29:33,792 --> 00:29:36,458
You know, I don't think
I would want to create

517
00:29:36,542 --> 00:29:41,166
a society where people
were not overconfident

518
00:29:41,250 --> 00:29:43,208
in what they
could achieve.

519
00:29:43,291 --> 00:29:45,166
Like who would
open a restaurant

520
00:29:45,250 --> 00:29:48,417
if that was the case,
or who would...

521
00:29:48,500 --> 00:29:49,834
who would do a startup?

522
00:29:50,500 --> 00:29:52,417
But I think this is
really the issue,

523
00:29:52,500 --> 00:29:56,166
is to say how do you
become a person of vision

524
00:29:56,250 --> 00:29:57,625
on one hand,

525
00:29:57,709 --> 00:30:00,041
and how do you
sell that vision

526
00:30:00,125 --> 00:30:01,583
on the other hand,

527
00:30:01,667 --> 00:30:04,125
but you also want to stay...

528
00:30:04,208 --> 00:30:07,500
not realistic, but, you know,
little closer to realistic

529
00:30:08,834 --> 00:30:10,291
when the task needs it.

530
00:30:10,375 --> 00:30:12,351
You have to be able
not to buy your own bullshit.

531
00:30:12,375 --> 00:30:14,333
Yes.

532
00:30:23,000 --> 00:30:25,166
You incorporate the company in '04.

533
00:30:25,250 --> 00:30:28,583
- Yeah.
- What happened in the intervening nine years?

534
00:30:28,667 --> 00:30:30,709
Our work during that period of time

535
00:30:30,792 --> 00:30:33,083
was for pharmaceutical
companies,

536
00:30:33,166 --> 00:30:37,250
and for developing
applications for the military.

537
00:30:37,333 --> 00:30:39,750
But that model's
going to evolve now

538
00:30:39,834 --> 00:30:42,333
'cause we're at another
inflection point

539
00:30:42,417 --> 00:30:46,667
- in our life cycle...
- But are you thinking about an IPO or...

540
00:30:46,750 --> 00:30:50,208
Well,
we really believe that there's value

541
00:30:50,291 --> 00:30:51,792
in being a private company.

542
00:30:51,875 --> 00:30:56,792
It's allowed us
to not have to talk about,

543
00:30:56,875 --> 00:31:01,250
you know, what we're doing
until it's done and introduce,

544
00:31:01,333 --> 00:31:04,333
you know, incredible
innovation without...

545
00:31:04,417 --> 00:31:07,792
Using just her story
as the blueprint for success,

546
00:31:07,875 --> 00:31:09,959
Holmes would convince
private investors

547
00:31:10,041 --> 00:31:12,500
to put up hundreds
of millions of dollars

548
00:31:12,583 --> 00:31:16,458
without ever looking at
audited financial statements.

549
00:31:16,542 --> 00:31:20,250
We like to think that investing
is a rational equation,

550
00:31:20,333 --> 00:31:23,583
a careful balance sheet
of risk and reward.

551
00:31:23,667 --> 00:31:25,333
But in fact, investors,

552
00:31:25,417 --> 00:31:27,041
particularly ones
who come in early,

553
00:31:27,125 --> 00:31:29,041
are often guided by their gut.

554
00:31:29,125 --> 00:31:30,583
Instead of relying on facts,

555
00:31:30,667 --> 00:31:33,959
early investing can be more
like a wing and a prayer.

556
00:31:34,041 --> 00:31:37,083
The word credit comes
from the Latin word credo,

557
00:31:37,166 --> 00:31:39,959
which means "I believe."

558
00:31:40,041 --> 00:31:42,333
Some of the early
believers included

559
00:31:42,417 --> 00:31:45,542
a former head of software
at Apple, Avie Tevanian,

560
00:31:45,625 --> 00:31:48,250
Oracle's founder,
Larry Ellison,

561
00:31:48,333 --> 00:31:51,917
and a founding investor
of Oracle, Don Lucas.

562
00:31:52,000 --> 00:31:54,041
They conferred
respectability on Elizabeth,

563
00:31:54,125 --> 00:31:56,500
even though they had
no record to go on,

564
00:31:56,583 --> 00:31:59,375
just a vague belief
that business and medicine

565
00:31:59,458 --> 00:32:01,542
were in her blood.

566
00:32:01,625 --> 00:32:04,375
I think she probably was 21 years old,

567
00:32:04,458 --> 00:32:06,166
had no background
in business,

568
00:32:06,250 --> 00:32:09,125
but her great-grandfather
was an entrepreneur.

569
00:32:09,208 --> 00:32:10,434
So, that's on
the entrepreneur's side,

570
00:32:10,458 --> 00:32:11,685
but she was on
the medical side.

571
00:32:11,709 --> 00:32:12,917
Ah, turns out later

572
00:32:13,000 --> 00:32:15,500
the hospital in there,
where they live

573
00:32:15,583 --> 00:32:17,750
is named after her great-uncle,

574
00:32:17,834 --> 00:32:21,959
who was involved with medicine,
so she came by both of these...

575
00:32:22,458 --> 00:32:24,458
the two things
that are necessary here,

576
00:32:24,542 --> 00:32:27,792
one medicine
and the other entrepreneur...

577
00:32:29,083 --> 00:32:30,458
quite naturally.

578
00:32:32,500 --> 00:32:35,667
I remember the day Elizabeth came in,

579
00:32:35,750 --> 00:32:37,208
full of vim and vigor,

580
00:32:37,291 --> 00:32:40,125
and said, "I'm dropping
out of Stanford."

581
00:32:40,208 --> 00:32:41,583
And I knew her parents,

582
00:32:41,667 --> 00:32:44,625
and I knew her and her brother
as they were growing up.

583
00:32:44,709 --> 00:32:47,250
She was a good friend
of my daughter's.

584
00:32:47,333 --> 00:32:48,750
I said, "Do your
parents know

585
00:32:48,834 --> 00:32:50,393
you're dropping out
of Stanford?" She said,

586
00:32:50,417 --> 00:32:53,250
"Yes, yes!
And they agree, and it's a great thing.

587
00:32:53,333 --> 00:32:55,291
"And I learned at Stanford

588
00:32:55,375 --> 00:32:57,917
"how this whole health care
thing is working,

589
00:32:58,000 --> 00:32:59,750
and it's just not."

590
00:32:59,834 --> 00:33:02,000
And then she said,
"I'm going to change health care

591
00:33:02,083 --> 00:33:04,792
as we know it."
I was all over it.

592
00:33:04,875 --> 00:33:07,750
I thought that was
a great opportunity.

593
00:33:08,333 --> 00:33:10,709
I mean,
Elizabeth was a family friend.

594
00:33:10,792 --> 00:33:13,083
You'd known her since
she was a little girl.

595
00:33:13,166 --> 00:33:14,625
Did that go
into your thinking,

596
00:33:14,709 --> 00:33:16,291
in terms of your
initial investment?

597
00:33:16,375 --> 00:33:20,417
No. We've been... I've been in
the venture business a long time.

598
00:33:20,500 --> 00:33:23,667
I was the first investor in Tesla,
first investor in Skype,

599
00:33:23,750 --> 00:33:26,959
first investor in Baidu,
first investor in Hotmail.

600
00:33:27,041 --> 00:33:28,583
I always invest early.

601
00:33:28,667 --> 00:33:30,875
I invest when I see a vision,

602
00:33:30,959 --> 00:33:32,333
I see the opportunity,

603
00:33:32,417 --> 00:33:36,417
and I see the person who
I think can make it there.

604
00:33:36,500 --> 00:33:38,959
I mean, we invest in, you know,

605
00:33:39,041 --> 00:33:42,792
a girl and a dog,
or two guys and a cat.

606
00:33:42,875 --> 00:33:46,083
We just say, "Is this person
going to dedicate their life,

607
00:33:46,166 --> 00:33:49,333
and make something
extraordinary happen?"

608
00:33:49,417 --> 00:33:52,709
And yes, in that case,
she was that person.

609
00:33:55,542 --> 00:33:58,125
So, the reality is that data

610
00:33:58,208 --> 00:34:01,041
just doesn't sit in our mind

611
00:34:01,125 --> 00:34:03,625
as much as stories do.

612
00:34:03,709 --> 00:34:07,417
It's almost like the glue
that takes all of the data,

613
00:34:07,917 --> 00:34:09,500
and even more important,

614
00:34:09,583 --> 00:34:13,125
stories have emotions
that data doesn't.

615
00:34:13,208 --> 00:34:15,041
And emotions get people to...

616
00:34:15,125 --> 00:34:18,166
to do all kinds of things,
good and bad.

617
00:34:18,250 --> 00:34:23,208
And if you think about the
people who invested in her

618
00:34:23,291 --> 00:34:25,208
with very little
amount of data,

619
00:34:25,291 --> 00:34:28,000
it's about having an emotional
appeal and about having trust,

620
00:34:28,083 --> 00:34:31,291
and believing the story,
and being moved by this,

621
00:34:31,375 --> 00:34:33,500
and being able to tell
themselves a story.

622
00:34:36,750 --> 00:34:39,267
For 10 years, we did this work.
We didn't have a website.

623
00:34:39,291 --> 00:34:41,625
We never put out
a press release.

624
00:34:41,709 --> 00:34:43,625
It was completely heads down.

625
00:34:43,709 --> 00:34:46,125
When we got to a point
in which we realized

626
00:34:46,208 --> 00:34:50,041
that what we were doing
could serve individuals,

627
00:34:50,125 --> 00:34:52,166
I wanted to find the people

628
00:34:52,250 --> 00:34:55,458
who were just
strategically brilliant.

629
00:34:57,208 --> 00:34:59,625
General Mattis,
who was former

630
00:34:59,709 --> 00:35:02,834
CENTCON Commander,
is one of our board members.

631
00:35:02,917 --> 00:35:04,709
Dick Kovacevich, who is

632
00:35:04,792 --> 00:35:07,750
the former CEO of
Wells Fargo is another.

633
00:35:07,834 --> 00:35:10,041
Sam Nunn has done
some incredible work

634
00:35:10,125 --> 00:35:13,458
on nuclear threats
as well as biothreats.

635
00:35:13,542 --> 00:35:15,875
Bill Perry,
former secretary of defense.

636
00:35:15,959 --> 00:35:18,792
Henry Kissinger,
former secretary of state.

637
00:35:18,875 --> 00:35:20,542
And George Shultz,

638
00:35:20,625 --> 00:35:23,208
who was secretary of state

639
00:35:23,291 --> 00:35:28,000
and labor
and secretary of treasury.

640
00:35:28,083 --> 00:35:30,959
About three years ago,
I looked at her and I said, "Well,

641
00:35:31,041 --> 00:35:33,959
I'm about to have a meeting with
a friend of my granddaughter."

642
00:35:35,583 --> 00:35:37,250
- Yes.
- As soon as she started talking,

643
00:35:37,333 --> 00:35:38,917
I did a double take...

644
00:35:39,000 --> 00:35:41,917
I first met Elizabeth
in my grandfather's living room.

645
00:35:42,000 --> 00:35:44,184
So, he had called me up and
said that he was going to have

646
00:35:44,208 --> 00:35:47,417
some brilliant woman over
to have a discussion.

647
00:35:47,500 --> 00:35:50,083
He thought that
I would be interested

648
00:35:50,166 --> 00:35:52,250
in coming,
so I went to his house.

649
00:35:52,333 --> 00:35:54,250
It was me,
my grandfather, Elizabeth,

650
00:35:54,333 --> 00:35:56,917
and Dianne Feinstein
was there as well.

651
00:35:57,500 --> 00:36:01,375
Elizabeth kind of pitched
her dream of changing the way

652
00:36:01,458 --> 00:36:04,166
diagnostics is done, really
revolutionizing the field.

653
00:36:04,250 --> 00:36:06,750
Yeah, I was totally
gung-ho about Theranos.

654
00:36:06,834 --> 00:36:09,625
I was really excited about
what she was talking about.

655
00:36:09,709 --> 00:36:12,208
I really wanted to know
what the technology was.

656
00:36:12,834 --> 00:36:14,667
And I actually asked her,
in that meeting,

657
00:36:14,750 --> 00:36:16,458
if I could intern
there over the summer.

658
00:36:16,542 --> 00:36:18,583
I said,
do you guys take interns?

659
00:36:18,667 --> 00:36:21,208
Like, I want to work on this.
This sounds amazing.

660
00:36:21,291 --> 00:36:23,333
We think that...

661
00:36:24,041 --> 00:36:25,792
there's going to be a revolution

662
00:36:25,875 --> 00:36:27,583
in preventive medicine.

663
00:36:27,667 --> 00:36:31,166
I mean, he had a really close
relationship with Elizabeth.

664
00:36:31,250 --> 00:36:34,750
She was almost like...
becoming part of the family.

665
00:36:34,834 --> 00:36:38,458
She was coming to our birthday
parties and Christmases.

666
00:36:38,542 --> 00:36:41,125
We think this is one
of the most optimistic things

667
00:36:41,208 --> 00:36:42,625
out there

668
00:36:42,709 --> 00:36:45,875
about the health care system
and its costs and its problems.

669
00:36:45,959 --> 00:36:49,709
You talk to George Shultz.
He's a very impressive man.

670
00:36:49,792 --> 00:36:52,834
And I was impressed that he
adopted her like a daughter.

671
00:36:52,917 --> 00:36:54,625
He really believed in her.

672
00:36:54,709 --> 00:36:57,166
From the outside,
all you're thinking is,

673
00:36:57,250 --> 00:36:59,000
wow,
what a board!

674
00:36:59,083 --> 00:37:01,000
Right? I mean,
it's just impressive.

675
00:37:01,083 --> 00:37:03,583
And they were really...
And I talked to most of them.

676
00:37:03,667 --> 00:37:05,787
They were impressed with...
really impressed with her.

677
00:37:05,834 --> 00:37:07,976
This is General Mattis.
I assume we're on the record,

678
00:37:08,000 --> 00:37:10,101
unless you tell me not, and
I'll shut off this recorder.

679
00:37:10,125 --> 00:37:11,625
- But...
- Okay.

680
00:37:11,709 --> 00:37:13,750
When you think of Elizabeth,

681
00:37:13,834 --> 00:37:15,834
what are the first words
that come to your mind?

682
00:37:15,917 --> 00:37:18,500
First is integrity,

683
00:37:18,583 --> 00:37:20,542
uh, competence,

684
00:37:20,625 --> 00:37:23,792
and competence is both
technical, scientific,

685
00:37:23,875 --> 00:37:26,667
but also focused
on human rights

686
00:37:26,750 --> 00:37:29,208
in the most classical
sense of what

687
00:37:29,291 --> 00:37:30,834
human rights are about.

688
00:37:30,917 --> 00:37:33,917
And all of a sudden,
you have the ability to know

689
00:37:34,000 --> 00:37:36,375
if someone is ill
or not. I mean,

690
00:37:36,458 --> 00:37:39,583
literally,
within minutes of taking...

691
00:37:39,667 --> 00:37:41,875
you know, a drop of blood.

692
00:37:41,959 --> 00:37:44,375
And I mean, she is really...

693
00:37:44,458 --> 00:37:47,959
a revolutionary
in the truest sense.

694
00:37:49,291 --> 00:37:52,542
It was quite amazing to spend
time with these people.

695
00:37:52,625 --> 00:37:54,875
They were talking about her
as if she were Beethoven.

696
00:38:00,959 --> 00:38:03,375
As if she was
this rare creature

697
00:38:03,458 --> 00:38:07,041
that maybe one in a century
or two in a century come along,

698
00:38:07,125 --> 00:38:09,834
who really can
change the world.

699
00:38:12,750 --> 00:38:14,875
And I remember when
I interviewed Henry Kissinger,

700
00:38:14,959 --> 00:38:17,083
I didn't trust him
on medical stuff,

701
00:38:17,166 --> 00:38:20,458
not to mention on Cambodia,
but...

702
00:38:20,542 --> 00:38:21,917
But when I asked him about her,

703
00:38:22,000 --> 00:38:23,208
he described...

704
00:38:23,291 --> 00:38:25,208
Excellent businesswoman.

705
00:38:25,291 --> 00:38:28,709
Let me see that I can put
this on speaker for a minute.

706
00:38:28,792 --> 00:38:31,000
- Be easier for me.
- Okay.

707
00:38:34,166 --> 00:38:36,542
Yeah, but
I don't know how to do that.

708
00:38:38,000 --> 00:38:39,875
You put it on ho...

709
00:38:39,959 --> 00:38:42,542
- How about it now?
- I hear you loud and clear.

710
00:38:42,625 --> 00:38:44,166
- You okay?
- Perfect.

711
00:38:44,250 --> 00:38:47,333
What's your impression
of how she runs the board?

712
00:38:56,792 --> 00:39:00,291
I'm told you once said
that these board meetings,

713
00:39:00,375 --> 00:39:02,333
which go on all day...

714
00:39:10,959 --> 00:39:13,159
You know,
whatever you think of Henry Kissinger,

715
00:39:13,208 --> 00:39:16,625
he's met a lot of leaders,
he's met a lot of world leaders,

716
00:39:16,709 --> 00:39:18,291
he met a lot
of corporate leaders.

717
00:39:18,375 --> 00:39:20,041
I thought he might be a judge,

718
00:39:20,125 --> 00:39:22,625
but the truth is that

719
00:39:22,709 --> 00:39:26,458
none of these people were really
in a position to know what...

720
00:39:26,542 --> 00:39:29,792
- To judge 'cause they didn't have the qualifications.
- Yeah. No. No.

721
00:39:29,875 --> 00:39:32,041
She didn't really
want scientific input

722
00:39:32,125 --> 00:39:34,333
from what I could determine.

723
00:39:34,417 --> 00:39:36,667
Engineering a bit more

724
00:39:36,750 --> 00:39:38,792
'cause she was inventing
an engineering device,

725
00:39:38,875 --> 00:39:40,250
but not medicine.

726
00:39:40,333 --> 00:39:43,333
She aligned herself
with very powerful older men

727
00:39:43,417 --> 00:39:47,750
who seemed to succumb
to a certain charm, and...

728
00:39:47,834 --> 00:39:51,375
those powerful men
could influence people

729
00:39:51,458 --> 00:39:52,917
in the government,

730
00:39:53,000 --> 00:39:55,458
influence
the Department of Defense.

731
00:39:55,542 --> 00:39:59,375
When I asked her was this all
about getting government contracts,

732
00:39:59,458 --> 00:40:01,667
she danced around
my questions about that.

733
00:40:01,750 --> 00:40:04,000
Everything that we're doing

734
00:40:04,083 --> 00:40:07,333
may go into certain work
we do for the military,

735
00:40:07,417 --> 00:40:09,834
which we really couldn't
put on the record.

736
00:40:09,917 --> 00:40:12,166
Well, off the record,
we were doing some work

737
00:40:12,250 --> 00:40:14,834
for the military,
which we can talk about off the record.

738
00:40:14,917 --> 00:40:16,667
Why would that be off the record?

739
00:40:16,750 --> 00:40:19,000
You know, generally,
our philosophy on these things is

740
00:40:19,083 --> 00:40:21,500
talk about it if there's
a purpose to talking about it,

741
00:40:21,583 --> 00:40:22,750
and there just...

742
00:40:22,834 --> 00:40:25,000
So,
could you say anything about

743
00:40:25,083 --> 00:40:27,458
the military contracts
you have? I mean...

744
00:40:28,750 --> 00:40:31,375
No.

745
00:40:31,458 --> 00:40:34,083
When you... I'm going to make
you feel guilty at some point.

746
00:40:34,166 --> 00:40:38,083
You already have.
You're good at it too.

747
00:40:38,166 --> 00:40:40,542
In conversations,
Elizabeth suggested

748
00:40:40,625 --> 00:40:43,041
that she had contracts
with the military.

749
00:40:43,125 --> 00:40:44,834
In a mock-up of
marketing materials,

750
00:40:44,917 --> 00:40:47,750
Theranos invented a quote
from General Mattis

751
00:40:47,834 --> 00:40:49,709
about a battle plan
to use Edisons

752
00:40:49,792 --> 00:40:52,583
on wounded soldiers
in combat zones,

753
00:40:52,667 --> 00:40:54,417
but this never happened.

754
00:40:54,500 --> 00:40:57,875
Before permitting Theranos to
use the machines on soldiers,

755
00:40:57,959 --> 00:41:01,000
Pentagon officials wanted
to run their own tests,

756
00:41:01,083 --> 00:41:02,583
but Elizabeth declined.

757
00:41:02,667 --> 00:41:05,250
She had a policy of
controlling demonstrations

758
00:41:05,333 --> 00:41:07,083
and tightly guarding access

759
00:41:07,166 --> 00:41:09,458
to the Edison prototypes.

760
00:41:09,542 --> 00:41:10,875
I pressed them

761
00:41:10,959 --> 00:41:14,083
repeatedly, and I wasn't
allowed, and finally,

762
00:41:14,166 --> 00:41:17,375
I persisted in asking.
"I need to see the machine."

763
00:41:17,458 --> 00:41:19,542
And she said to me,

764
00:41:19,625 --> 00:41:21,583
"All right, we'll let
you see the machine,

765
00:41:21,667 --> 00:41:25,625
but you have to agree not
to describe the machine."

766
00:41:34,583 --> 00:41:36,792
It was downstairs,

767
00:41:36,875 --> 00:41:40,625
in an area you couldn't see
from all the glassed offices.

768
00:41:46,166 --> 00:41:49,250
The lab is a large,
labyrinthian place

769
00:41:49,333 --> 00:41:51,875
bustling with chemists
and technicians,

770
00:41:51,959 --> 00:41:54,041
and housing rows of machines,

771
00:41:54,125 --> 00:41:56,458
each easy for
a single person to lift,

772
00:41:56,542 --> 00:41:59,417
in which the container
of blood is placed.

773
00:42:00,709 --> 00:42:03,125
What exactly happens
in the machine

774
00:42:03,208 --> 00:42:05,291
is treated as a state secret,

775
00:42:05,375 --> 00:42:07,917
and Holmes's description
of the process

776
00:42:08,000 --> 00:42:10,000
was comically vague.

777
00:42:10,917 --> 00:42:14,625
A chemistry is performed,

778
00:42:14,709 --> 00:42:16,750
so a chemical reaction occurs

779
00:42:16,834 --> 00:42:18,750
and generates a signal

780
00:42:18,834 --> 00:42:22,083
from the chemical interaction
with the sample,

781
00:42:22,166 --> 00:42:25,083
which is then translated
into a result...

782
00:42:25,166 --> 00:42:27,333
"Which is then
reviewed by certified

783
00:42:27,417 --> 00:42:29,291
laboratory personnel."

784
00:42:30,000 --> 00:42:33,625
End quote. She added
that thanks to, quote...

785
00:42:33,709 --> 00:42:35,458
Miniaturization

786
00:42:35,542 --> 00:42:39,667
"and associated automation
that we're able to...

787
00:42:39,750 --> 00:42:41,834
handle these tiny samples.

788
00:42:58,041 --> 00:43:00,667
All right, so...

789
00:43:00,750 --> 00:43:02,542
Comments? Sunny?

790
00:43:04,083 --> 00:43:06,417
So, I just want
to expand a little bit

791
00:43:06,500 --> 00:43:08,667
on a comment
that Elizabeth made.

792
00:43:08,750 --> 00:43:12,250
You know, we are a very
conservative company

793
00:43:12,333 --> 00:43:13,917
because we think

794
00:43:14,000 --> 00:43:17,542
that you should get things done
before you talk about them.

795
00:43:17,625 --> 00:43:20,208
Right? And that's
the culture we have created.

796
00:43:20,291 --> 00:43:21,792
So, I just want
all of you to remember

797
00:43:21,875 --> 00:43:23,795
that when we come to work
every day that we carry

798
00:43:23,834 --> 00:43:27,500
that sense of mission in your
hearts every single day...

799
00:43:27,583 --> 00:43:29,208
Sunny was very successful

800
00:43:29,291 --> 00:43:31,709
in the late '90s
with a tech company

801
00:43:31,792 --> 00:43:33,375
that sold for a lot of money.

802
00:43:33,458 --> 00:43:35,643
He seemed kind of like a Mark Cuban
character, potentially, to me,

803
00:43:35,667 --> 00:43:38,017
in some ways, where he was at
the right place, the right time.

804
00:43:38,041 --> 00:43:40,917
Made a lot of money.

805
00:43:41,000 --> 00:43:43,709
His expertise was
software and IT.

806
00:43:43,792 --> 00:43:45,552
What we are doing is
really, really difficult

807
00:43:45,625 --> 00:43:48,750
because we're going
against an entire system

808
00:43:48,834 --> 00:43:51,542
that doesn't believe
that prevention is possible.

809
00:43:51,625 --> 00:43:54,917
I always felt like Sunny
was making a deal, you know?

810
00:43:55,000 --> 00:43:58,417
Like, he knew the technology,
but just enough to sell it.

811
00:43:58,500 --> 00:44:02,041
To him, this was another home
run that he was going to hit.

812
00:44:03,417 --> 00:44:05,709
He was 49 and she was 30,

813
00:44:05,792 --> 00:44:08,917
but she was the dominant
figure in that relationship.

814
00:44:09,000 --> 00:44:10,875
And when he talked about her,

815
00:44:10,959 --> 00:44:12,959
he talked about her
in a very deferential way,

816
00:44:13,041 --> 00:44:14,142
that she was kind of a genius.

817
00:44:14,166 --> 00:44:16,583
When he spoke about Elizabeth,

818
00:44:16,667 --> 00:44:20,583
he was really...
reverential.

819
00:44:20,667 --> 00:44:25,208
"Elizabeth is the most important
inventor of our times."

820
00:44:29,458 --> 00:44:33,375
You know, I think Sunny saw her as
this iconic figure that he could never be,

821
00:44:33,458 --> 00:44:39,333
and so he, I think, found this vehicle
for him to advance himself in her,

822
00:44:39,417 --> 00:44:41,542
and, you know, she was
on board for it, too.

823
00:44:44,208 --> 00:44:47,917
She lived with him
at some condo in Palo Alto.

824
00:44:48,000 --> 00:44:50,291
I thought that
there was definitely

825
00:44:50,375 --> 00:44:52,542
something going on
behind the scenes there.

826
00:44:52,625 --> 00:44:54,125
They certainly
would leave together,

827
00:44:54,208 --> 00:44:56,166
they'd come in
at similar times.

828
00:44:56,250 --> 00:44:58,083
They're always
talking to each other,

829
00:44:58,166 --> 00:45:00,375
offline, online,
in meetings,

830
00:45:00,458 --> 00:45:02,875
outside of meetings.
They were very close.

831
00:45:04,208 --> 00:45:06,750
It wasn't uncommon
for Elizabeth and Sunny

832
00:45:06,834 --> 00:45:09,125
to go to the Silicon Valley
airport

833
00:45:09,208 --> 00:45:10,333
and go off to some meeting.

834
00:45:10,417 --> 00:45:12,542
They were going to go
sell this thing,

835
00:45:12,625 --> 00:45:15,208
go make a deal.

836
00:45:21,417 --> 00:45:25,458
Without disclosing their
romantic relationship to investors,

837
00:45:25,542 --> 00:45:29,000
Elizabeth and Sunny flew off
together to corporate presentations,

838
00:45:29,083 --> 00:45:33,458
touting the potential
of the Edison prototypes.

839
00:45:33,542 --> 00:45:36,917
One company, Walgreens,
loved the pitch.

840
00:45:38,041 --> 00:45:39,792
In this 2010 PowerPoint,

841
00:45:39,875 --> 00:45:43,041
Theranos showcased
an early version of Edison,

842
00:45:43,125 --> 00:45:44,667
a portable
blood testing machine

843
00:45:44,750 --> 00:45:48,917
that could be deployed in
pharmacies all over the world.

844
00:45:49,000 --> 00:45:50,625
Theranos boasted
the device could,

845
00:45:50,709 --> 00:45:52,792
"eliminate the need for a lab,"

846
00:45:52,875 --> 00:45:55,291
by doing up
to 200 tests in minutes

847
00:45:55,375 --> 00:45:58,333
from a finger-prick drop
of capillary blood.

848
00:45:58,417 --> 00:46:02,000
It wasn't true then,
but once Walgreens signed a contract,

849
00:46:02,083 --> 00:46:04,959
Theranos struggled to make
it true, constantly changing

850
00:46:05,041 --> 00:46:08,291
the machine's color,
shape, and mechanics.

851
00:46:08,375 --> 00:46:10,583
Strangely,
Walgreens never looked

852
00:46:10,667 --> 00:46:13,083
inside any version
of the magic box

853
00:46:13,166 --> 00:46:17,291
to see if it could deliver
what Theranos promised.

854
00:46:17,375 --> 00:46:19,375
There's a great Martin Luther King quote.

855
00:46:19,458 --> 00:46:21,792
"Take the first step in faith.

856
00:46:21,875 --> 00:46:23,583
"You don't have to see
the whole staircase,

857
00:46:23,667 --> 00:46:25,208
just take the first step."
Right?

858
00:46:25,291 --> 00:46:28,291
And this is...
this is the first step.

859
00:46:29,291 --> 00:46:31,750
So, talk to me a little
bit about the Edison machine.

860
00:46:31,834 --> 00:46:34,000
How would you say it
was working in terms of

861
00:46:34,083 --> 00:46:35,792
the vision versus
the reality?

862
00:46:39,000 --> 00:46:40,208
Uh, poorly.

863
00:46:41,542 --> 00:46:43,222
We couldn't regulate
temperature very well.

864
00:46:43,250 --> 00:46:46,083
We couldn't reproducibly
transfer fluids.

865
00:46:46,166 --> 00:46:48,458
We had all sorts
of design changes constantly

866
00:46:48,542 --> 00:46:49,935
that we were trying
to fight against,

867
00:46:49,959 --> 00:46:52,709
so it was a comedy of errors
in a lot of ways.

868
00:46:52,792 --> 00:46:54,875
The original concept was to make a machine

869
00:46:54,959 --> 00:46:57,333
that, at least then,
the chemists could work on

870
00:46:57,417 --> 00:46:59,166
to further develop chemistry.

871
00:46:59,250 --> 00:47:02,291
Over time, we were
able to run a sequence

872
00:47:02,375 --> 00:47:04,125
and we were able
to get results.

873
00:47:04,208 --> 00:47:07,000
Getting results
means, you know,

874
00:47:07,083 --> 00:47:10,250
I get a signal proportional
to what I'm putting in.

875
00:47:10,333 --> 00:47:12,750
It doesn't mean it's ready for prime time,
right?

876
00:47:16,625 --> 00:47:19,750
You're handling a
lot of fluid in the machine.

877
00:47:19,834 --> 00:47:24,458
Things got blood spilled
all over them and got gunky.

878
00:47:24,542 --> 00:47:26,125
Some of the donors
that we had were,

879
00:47:26,208 --> 00:47:27,917
you know,
just people off the street

880
00:47:28,000 --> 00:47:30,709
who need money,
and I imagine that, you know,

881
00:47:30,792 --> 00:47:32,417
there probably
was a fair amount

882
00:47:32,500 --> 00:47:34,125
of hepatitis
and things like that.

883
00:47:34,208 --> 00:47:37,458
And the device would freeze up
in the middle of running a test,

884
00:47:37,542 --> 00:47:41,375
and then I would have to reach
in there with my hands.

885
00:47:41,458 --> 00:47:43,458
There were needles
within the device

886
00:47:43,542 --> 00:47:45,583
that could puncture skin,

887
00:47:45,667 --> 00:47:47,000
and there's reagents

888
00:47:47,083 --> 00:47:49,834
and blood and everything
spilling all over the place.

889
00:47:49,917 --> 00:47:52,458
Blood that's just sitting there
in the bottom of the vessel,

890
00:47:52,542 --> 00:47:55,542
evaporating into
the air in the room.

891
00:47:55,625 --> 00:47:57,792
It was a mess inside.

892
00:47:57,875 --> 00:48:00,208
Pieces of the device would literally fall off

893
00:48:00,291 --> 00:48:01,750
in the middle of testing.

894
00:48:01,834 --> 00:48:03,667
Centrifuges exploding
inside of it

895
00:48:03,750 --> 00:48:06,083
and things like that.

896
00:48:06,166 --> 00:48:07,810
Obviously,
they didn't want anybody

897
00:48:07,834 --> 00:48:10,542
to actually see what
was going on in there.

898
00:48:12,291 --> 00:48:14,834
So, when we had demos,
they would bring investors

899
00:48:14,917 --> 00:48:18,625
or executives from some company
to a room which would have

900
00:48:18,709 --> 00:48:21,000
different styles of Edison
they were prototyping.

901
00:48:25,875 --> 00:48:28,041
They would do a fingerstick
on the executives,

902
00:48:28,125 --> 00:48:30,417
so they'd take
a fingerstick of blood.

903
00:48:32,500 --> 00:48:35,125
They would put the blood
into the cartridge,

904
00:48:35,208 --> 00:48:37,834
and then they would put
the cartridge into this Edison.

905
00:48:42,500 --> 00:48:44,893
They'd walk the executives out of
the room to go give them a tour,

906
00:48:44,917 --> 00:48:46,893
or to go have a meeting,
or go have lunch or whatever,

907
00:48:46,917 --> 00:48:49,500
and immediately afterwards,
an engineer would run in,

908
00:48:49,583 --> 00:48:51,423
grab the cartridge
and bring it out to the lab,

909
00:48:51,458 --> 00:48:55,750
where my team would do
the assays at the bench.

910
00:48:55,834 --> 00:48:59,291
We were on call,
so this could be done in an hour.

911
00:48:59,375 --> 00:49:01,875
We got reasonable data
every time,

912
00:49:01,959 --> 00:49:03,625
and then we would
get those results,

913
00:49:03,709 --> 00:49:06,291
the engineer would run
into the room with the results,

914
00:49:06,375 --> 00:49:08,184
and these guys would come
back in and they'd say,

915
00:49:08,208 --> 00:49:10,583
"Well, here's your results
from running our tests."

916
00:49:13,959 --> 00:49:16,875
We had listed on the webpage,
like, 200 different assays,

917
00:49:16,959 --> 00:49:21,458
but we had no more than half of those
actually validated to be working,

918
00:49:21,542 --> 00:49:25,250
even in the lab at that point,
let alone on the Edisons.

919
00:49:25,333 --> 00:49:28,083
Because it's trying to do multiple analyses,

920
00:49:28,166 --> 00:49:31,250
you need so much hardware
inside the machine,

921
00:49:31,333 --> 00:49:33,750
it was totally impractical.

922
00:49:33,834 --> 00:49:35,792
They were very adamant about

923
00:49:35,875 --> 00:49:39,250
the machine being this big.
It's gotta be this big.

924
00:49:39,333 --> 00:49:41,125
And I said,

925
00:49:41,834 --> 00:49:43,291
"We can't do that.

926
00:49:43,375 --> 00:49:44,750
"The laws of physics just

927
00:49:44,834 --> 00:49:46,917
"are not going to permit
us to cram all the stuff

928
00:49:47,000 --> 00:49:49,583
"that we've decided needs to go
in there into this little box.

929
00:49:49,667 --> 00:49:52,250
Can the box be bigger?"

930
00:49:52,333 --> 00:49:55,333
And a common
response at Theranos

931
00:49:55,417 --> 00:49:56,750
was something
along the lines

932
00:49:56,834 --> 00:49:58,208
of, "Well, maybe
you're not...

933
00:49:58,291 --> 00:50:00,458
"maybe you're not a
Silicon Valley person.

934
00:50:00,542 --> 00:50:02,823
"You should go work for some
other company if you don't...

935
00:50:02,875 --> 00:50:04,142
"if you don't
believe in the vision

936
00:50:04,166 --> 00:50:05,834
of the product."

937
00:50:05,917 --> 00:50:07,375
And what would start off

938
00:50:07,458 --> 00:50:10,542
as a very serious brainstorming
meeting would turn into

939
00:50:10,625 --> 00:50:12,250
a two-hour conversation about

940
00:50:12,333 --> 00:50:15,625
the name of the cloud that's
going to process the information.

941
00:50:15,709 --> 00:50:18,959
It's like, time out. How big
does this box need to be

942
00:50:19,041 --> 00:50:20,792
to abide by the laws
of thermodynamics,

943
00:50:20,875 --> 00:50:22,792
and actually function,
and saves people's lives?

944
00:50:22,875 --> 00:50:26,166
Maybe that's more important
than the name of the cloud

945
00:50:26,250 --> 00:50:28,208
that processes
the information,

946
00:50:28,291 --> 00:50:30,542
which I think ended up
being Yoda or something.

947
00:50:31,083 --> 00:50:33,709
- Was it Yoda?
- I think so.

948
00:50:33,792 --> 00:50:37,500
What's your favorite
sound from the movie Star Wars?

949
00:50:38,333 --> 00:50:39,792
Yoda.

950
00:50:39,875 --> 00:50:41,792
What does Yoda sound like?

951
00:50:41,875 --> 00:50:45,000
Yoda sounds like,
"Do or do not. There is no try."

952
00:50:47,500 --> 00:50:51,333
You can't just bend your
way around the laws of physics.

953
00:50:51,417 --> 00:50:53,583
You can't just have a
great marketing campaign,

954
00:50:53,667 --> 00:50:55,500
and then get around
these things.

955
00:50:57,583 --> 00:51:00,333
Sunny and Elizabeth,
they didn't care

956
00:51:00,417 --> 00:51:02,917
that we figure out what's
not working, or make sure

957
00:51:03,000 --> 00:51:06,125
that we can actually solve
these problems in a real way.

958
00:51:06,208 --> 00:51:09,041
They always seemed to
think that everything could happen

959
00:51:09,125 --> 00:51:10,917
very fast,
and if you said no,

960
00:51:11,000 --> 00:51:13,000
then they just went around
to find the next person

961
00:51:13,083 --> 00:51:14,125
who would say yes.

962
00:51:14,792 --> 00:51:17,667
And generally, they tended
to start become younger

963
00:51:17,750 --> 00:51:19,667
and less experienced, right?

964
00:51:19,750 --> 00:51:21,583
"We're going to disrupt.
We don't want people

965
00:51:21,667 --> 00:51:23,959
"who are stuck in
the old ways of actually,

966
00:51:24,041 --> 00:51:26,375
"you know, validating
experiments, and, you know,

967
00:51:26,458 --> 00:51:29,667
doing things properly
with documentation."

968
00:51:31,959 --> 00:51:34,625
One of those people
who wanted things done properly

969
00:51:34,709 --> 00:51:36,125
was Ian Gibbons.

970
00:51:36,208 --> 00:51:39,208
The first experienced
scientist hired by Theranos,

971
00:51:39,291 --> 00:51:41,250
he was an expert
in blood testing

972
00:51:41,333 --> 00:51:44,417
and had done much of the work
on the company's key patents,

973
00:51:44,500 --> 00:51:47,291
to which Elizabeth
had attached her name.

974
00:51:48,125 --> 00:51:50,500
Ian was a Cambridge PhD.

975
00:51:50,583 --> 00:51:53,500
He knew things the rest
of us didn't know.

976
00:51:53,583 --> 00:51:56,959
He would work with some of the
younger chemists and scientists,

977
00:51:57,041 --> 00:51:58,434
and help them
with their experiments,

978
00:51:58,458 --> 00:51:59,959
help them to design
their experiments,

979
00:52:00,041 --> 00:52:02,417
help them to analyze their data,
interpret their data, etc.

980
00:52:02,500 --> 00:52:05,709
He was just a wealth
of knowledge, and it was,

981
00:52:05,792 --> 00:52:08,792
you know, at the time, it kind of evolved,
I knew him for two years,

982
00:52:08,875 --> 00:52:12,041
and my opinion of him evolved
only just to be better

983
00:52:12,125 --> 00:52:14,476
because he was just trying to
make the best of his situation.

984
00:52:14,500 --> 00:52:18,458
Like, what I got to see there,
I got to see how marginalized he was.

985
00:52:19,291 --> 00:52:20,834
So, in about 2012,

986
00:52:20,917 --> 00:52:22,583
Ian didn't have
an office anymore.

987
00:52:22,667 --> 00:52:24,834
I think he felt
slighted by that.

988
00:52:24,917 --> 00:52:28,709
He wasn't involved
with decision-making.

989
00:52:28,792 --> 00:52:32,166
He would look at data and he
said things were not working.

990
00:52:32,500 --> 00:52:35,375
Ian really got into
bad shape with Sunny...

991
00:52:35,458 --> 00:52:37,250
both Sunny and Elizabeth,

992
00:52:37,333 --> 00:52:41,333
because there's so many things
wrong with that technology.

993
00:52:42,625 --> 00:52:46,417
And isn't that the point of
someone like that being there,

994
00:52:46,500 --> 00:52:49,792
to tell them why
it wasn't going to work?

995
00:52:49,875 --> 00:52:53,166
In early 2013,
Theranos tried to prevent Ian

996
00:52:53,250 --> 00:52:55,875
from having to testify
in a patent lawsuit.

997
00:52:55,959 --> 00:52:58,125
If he were to give evidence
that Elizabeth wasn't

998
00:52:58,208 --> 00:52:59,709
the inventor she claimed to be,

999
00:52:59,792 --> 00:53:02,959
some of the company's
patents might be invalidated.

1000
00:53:03,041 --> 00:53:05,041
As the date of his
deposition approached,

1001
00:53:05,125 --> 00:53:08,166
he drank heavily and fell
into a deep depression,

1002
00:53:08,250 --> 00:53:11,375
afraid that honesty
might cost him his job.

1003
00:53:12,166 --> 00:53:14,291
Some time in 2013,

1004
00:53:14,375 --> 00:53:17,000
he wasn't in work anymore.

1005
00:53:17,083 --> 00:53:18,542
Elizabeth told him
to stay at home

1006
00:53:18,625 --> 00:53:20,750
because I guess he was
saying things aren't working.

1007
00:53:20,834 --> 00:53:22,208
That was what
the story I was told.

1008
00:53:22,291 --> 00:53:25,959
Ian asked me if he thought
that he was going to be fired,

1009
00:53:26,041 --> 00:53:28,041
and I told him yes.

1010
00:53:28,125 --> 00:53:29,834
Unfortunately.

1011
00:53:29,917 --> 00:53:32,959
And that was the night
he killed himself.

1012
00:53:33,041 --> 00:53:37,166
He was so distraught
over this stupid, um...

1013
00:53:37,250 --> 00:53:39,625
inter... uh, this...

1014
00:53:39,709 --> 00:53:42,542
patent case,
misappropriation case,

1015
00:53:43,083 --> 00:53:48,333
and... not knowing what he was going
to do with the rest of his life,

1016
00:53:48,417 --> 00:53:50,959
and that's why
he committed suicide.

1017
00:53:51,667 --> 00:53:53,583
What was the reaction of the company

1018
00:53:53,667 --> 00:53:56,166
after Ian
committed suicide?

1019
00:53:56,250 --> 00:54:00,000
Um, I don't know because
they never communicated with me,

1020
00:54:00,083 --> 00:54:04,667
except to ask me to send back
his confidential stuff.

1021
00:54:06,917 --> 00:54:11,291
I brought back his documents
that he had at home,

1022
00:54:13,041 --> 00:54:15,291
and left them
at the front desk.

1023
00:54:16,625 --> 00:54:19,417
Did you ever hear
from Elizabeth Holmes again?

1024
00:54:19,500 --> 00:54:21,125
No.

1025
00:54:23,125 --> 00:54:26,208
If today were my last day on this Earth,

1026
00:54:26,291 --> 00:54:29,834
and I could say that

1027
00:54:29,917 --> 00:54:31,542
the people who've
gone through hell

1028
00:54:31,625 --> 00:54:33,750
in being able to just
get the test done

1029
00:54:33,834 --> 00:54:36,959
that they need to get care
now don't...

1030
00:54:37,625 --> 00:54:40,417
I've done something
in this world that

1031
00:54:40,500 --> 00:54:42,460
has made it a little bit
of a better place, right?

1032
00:54:42,542 --> 00:54:45,000
But you've got to be protective
about patent and all of that.

1033
00:54:45,083 --> 00:54:47,500
- We do...
- But do you have something to worry about,

1034
00:54:47,583 --> 00:54:49,375
obviously,
competitive businesses

1035
00:54:49,458 --> 00:54:51,709
always concerned
about, you know,

1036
00:54:51,792 --> 00:54:55,542
- the ideas incorporated into products.
- Sure.

1037
00:54:55,625 --> 00:54:57,750
You have to be on version 10

1038
00:54:57,834 --> 00:54:59,542
by the time anybody
else is on version one.

1039
00:54:59,625 --> 00:55:01,208
- Yes.
- And that's...

1040
00:55:01,291 --> 00:55:03,208
that's what our whole
business is about, so...

1041
00:55:03,291 --> 00:55:04,583
So, you're
paranoid?

1042
00:55:04,667 --> 00:55:06,750
- And you have to be.
- We try to be. Yeah.

1043
00:55:06,834 --> 00:55:09,291
We want to be the most
paranoid people on the planet.

1044
00:55:09,333 --> 00:55:10,583
Absolutely. Yeah.

1045
00:55:14,834 --> 00:55:16,208
For last two years,

1046
00:55:16,291 --> 00:55:18,875
year and a half,
we come under attack,

1047
00:55:18,959 --> 00:55:20,709
you know, from outside, and...

1048
00:55:20,792 --> 00:55:22,834
it's usually Quest Diagnostics.

1049
00:55:22,917 --> 00:55:25,959
Their entire product strategy
is lies, built around

1050
00:55:26,041 --> 00:55:29,667
getting people sick and then
living off of their diseases.

1051
00:55:29,750 --> 00:55:31,792
And we are trying
to change that, right?

1052
00:55:31,875 --> 00:55:33,834
So, it's really important
that you all understand

1053
00:55:33,917 --> 00:55:37,834
that what we are doing
here is so disruptive

1054
00:55:37,917 --> 00:55:40,166
that we will
always be attacked.

1055
00:55:40,208 --> 00:55:42,625
The paranoia seemed
to come from the belief that

1056
00:55:42,709 --> 00:55:45,142
someone's going to beat us to it,
or someone's going to steal our ideas,

1057
00:55:45,166 --> 00:55:46,846
or we're not going to get
the whole market.

1058
00:55:46,875 --> 00:55:49,166
There's a healthy degree
of paranoia and secrecy,

1059
00:55:49,291 --> 00:55:51,291
but this was well beyond that.

1060
00:55:52,875 --> 00:55:54,458
There was security.

1061
00:55:54,542 --> 00:55:57,291
You couldn't go walk up
into her office.

1062
00:55:57,375 --> 00:55:59,208
That just doesn't happen.

1063
00:55:59,291 --> 00:56:02,333
She had bulletproof glass
on their exterior windows.

1064
00:56:02,417 --> 00:56:04,667
There were bodyguards
waiting outside,

1065
00:56:04,750 --> 00:56:06,834
you know, couple guys
at the front lobby.

1066
00:56:06,917 --> 00:56:10,125
And that increased
more and more later on.

1067
00:56:10,208 --> 00:56:13,917
But, yeah, her and Sunny walk in
at the same time every morning.

1068
00:56:14,000 --> 00:56:16,750
"Eagle One,
Eagle Two's on their way."

1069
00:56:16,834 --> 00:56:19,917
And soon as they start pulling in,
"Okay, be ready.

1070
00:56:20,000 --> 00:56:22,208
Have the doors open."

1071
00:56:22,291 --> 00:56:24,667
She was Eagle One,
Sunny was Eagle Two.

1072
00:56:33,291 --> 00:56:34,500
Sunny supposedly

1073
00:56:34,625 --> 00:56:38,125
tracked all the key card
entries and exits,

1074
00:56:38,208 --> 00:56:40,208
so you would be
identified each time

1075
00:56:40,291 --> 00:56:42,458
you went into any area.

1076
00:56:45,083 --> 00:56:46,583
We would send e-mails,

1077
00:56:46,667 --> 00:56:49,208
not CC Sunny or Elizabeth,

1078
00:56:49,291 --> 00:56:52,125
and we would get
a response back from Sunny.

1079
00:56:52,208 --> 00:56:55,125
And I remember that was
a very big turning point for me,

1080
00:56:55,208 --> 00:56:58,917
where I was like, "You are being monitored.
You are being watched."

1081
00:56:59,000 --> 00:57:01,792
I found out that I was being keystroked.

1082
00:57:01,875 --> 00:57:03,792
That means that
anything that I typed

1083
00:57:03,875 --> 00:57:06,500
was being watched internally.

1084
00:57:06,583 --> 00:57:07,917
It seems
kind of extreme

1085
00:57:08,000 --> 00:57:09,375
for a receptionist,
doesn't it?

1086
00:57:09,500 --> 00:57:12,917
- Did that happen to you anywhere else?
- No.

1087
00:57:13,000 --> 00:57:16,166
And, of course, nondisclosure
agreements had to be signed.

1088
00:57:16,250 --> 00:57:17,750
A giant stack of paperwork

1089
00:57:17,834 --> 00:57:20,542
saying you can't speak
poorly about the company,

1090
00:57:20,625 --> 00:57:23,458
you're legally liable
for any detriment caused

1091
00:57:23,542 --> 00:57:25,742
to the company. It's like,
who's writing these contracts

1092
00:57:25,792 --> 00:57:27,500
and what are
they trying to hide?

1093
00:57:27,583 --> 00:57:29,903
We weren't supposed to
tell our families what we did.

1094
00:57:29,959 --> 00:57:31,709
We weren't supposed
to talk about anything

1095
00:57:31,792 --> 00:57:33,333
that went on
inside of Theranos.

1096
00:57:34,250 --> 00:57:35,417
Then, after a while,

1097
00:57:35,500 --> 00:57:37,500
people became paranoid
of one another.

1098
00:57:38,583 --> 00:57:40,667
We became much more siloed.

1099
00:57:40,750 --> 00:57:43,875
Walking down the hallway,
you'd say hi and the person would look

1100
00:57:43,959 --> 00:57:46,625
at the ceiling or the floor or
anything to avoid eye contact

1101
00:57:46,709 --> 00:57:48,291
and not acknowledge
you back.

1102
00:57:48,375 --> 00:57:50,559
Then the next person and the next person,
and then you'd notice,

1103
00:57:50,583 --> 00:57:54,333
there'd be whole groups that just wouldn't...
you were invisible to them.

1104
00:57:54,417 --> 00:57:57,208
It was very hard to communicate
information sometimes

1105
00:57:57,291 --> 00:57:59,417
because there were so
many blockades and silos

1106
00:57:59,500 --> 00:58:01,208
and this emphasis
on secrecy.

1107
00:58:01,291 --> 00:58:03,583
If the people from
the chemistry team could talk

1108
00:58:03,667 --> 00:58:06,875
about what was coming next
from the engineering team,

1109
00:58:06,959 --> 00:58:09,519
they would've said, "Well,
that's not going to solve the problem,"

1110
00:58:09,583 --> 00:58:13,000
but since everyone was
working on it separately,

1111
00:58:13,083 --> 00:58:14,917
they could all keep
working forever

1112
00:58:15,000 --> 00:58:17,125
without actually
solving anything.

1113
00:58:18,875 --> 00:58:21,625
The mantra in Silicon Valley
is, "Move fast, break things,"

1114
00:58:21,709 --> 00:58:23,375
and that is really dangerous

1115
00:58:23,458 --> 00:58:26,041
when people's lives
are in the balance.

1116
00:58:26,125 --> 00:58:29,125
Silicon Valley is really good at making

1117
00:58:29,208 --> 00:58:31,166
a web-based e-mail client,

1118
00:58:31,250 --> 00:58:35,083
or really great at making
a chat app with emojis on it.

1119
00:58:35,166 --> 00:58:37,184
A little mile when you kind of think about

1120
00:58:37,208 --> 00:58:39,750
what is all in that
thing you're holding.

1121
00:58:39,834 --> 00:58:42,250
But Silicon Valley is trying to do things

1122
00:58:42,333 --> 00:58:44,667
where people's lives
are on the line.

1123
00:58:44,750 --> 00:58:46,350
We're trying to make
autonomous vehicles.

1124
00:58:46,417 --> 00:58:48,333
We're trying to make
medical devices.

1125
00:58:48,417 --> 00:58:51,125
We're trying to do these things
that if you don't do it right,

1126
00:58:51,208 --> 00:58:53,333
quite frankly, people can die.

1127
00:58:53,417 --> 00:58:57,291
You need to approach it
with a different lens.

1128
00:58:57,375 --> 00:58:59,667
The problem is that when
you're developing the future,

1129
00:58:59,750 --> 00:59:01,959
you don't know what
the impact is going to be

1130
00:59:02,041 --> 00:59:04,291
because no one's
seen this before.

1131
00:59:04,375 --> 00:59:07,834
And the testing ground is
often just the general public.

1132
00:59:20,542 --> 00:59:23,542
In 2013, Theranos went live,

1133
00:59:23,625 --> 00:59:25,542
testing real patients
in Arizona

1134
00:59:25,625 --> 00:59:27,792
as part of a partnership
with Walgreens.

1135
00:59:28,542 --> 00:59:30,333
It was a risky move.

1136
00:59:30,417 --> 00:59:32,041
The Edison machines
had problems,

1137
00:59:32,125 --> 00:59:35,875
and they weren't approved by
regulators for in-store testing.

1138
00:59:35,959 --> 00:59:37,709
But Theranos was
running out of money

1139
00:59:37,792 --> 00:59:41,333
and needed the Walgreens deal
to attract new investors.

1140
00:59:41,417 --> 00:59:43,959
So, Elizabeth sold
Walgreens on a stopgap plan

1141
00:59:44,041 --> 00:59:47,500
to launch the Wellness
Centers without the Edisons.

1142
00:59:51,250 --> 00:59:53,208
Instead of testing
blood on-site,

1143
00:59:53,291 --> 00:59:55,750
patients' samples would
be sent to Palo Alto,

1144
00:59:55,834 --> 00:59:59,417
where Theranos had hastily
constructed a clinical lab.

1145
00:59:59,500 --> 01:00:02,000
Many of the technicians
were inexperienced.

1146
01:00:02,083 --> 01:00:05,250
When one lab director quit,
Theranos replaced him

1147
01:00:05,333 --> 01:00:07,500
with a dermatologist.

1148
01:00:08,500 --> 01:00:10,291
Due in part
to the Walgreens launch,

1149
01:00:10,375 --> 01:00:11,750
Theranos was able to raise

1150
01:00:11,834 --> 01:00:14,291
over $400 million
from new investors,

1151
01:00:14,375 --> 01:00:17,458
like the Walton family,
Betsy DeVos,

1152
01:00:17,542 --> 01:00:19,333
the owner of
the New England Patriots,

1153
01:00:19,417 --> 01:00:23,208
and Rupert Murdoch,
who put up $125 million.

1154
01:00:24,625 --> 01:00:26,000
To investors and patients,

1155
01:00:26,083 --> 01:00:29,417
it seemed like the system
was working as advertised.

1156
01:00:34,583 --> 01:00:37,208
The plan was launched in Arizona

1157
01:00:37,291 --> 01:00:39,291
as if it's
a nationwide campaign,

1158
01:00:39,375 --> 01:00:43,041
and then take key markets and
roll it out across the country.

1159
01:00:44,792 --> 01:00:47,542
I wasn't an engineer.
I wasn't a scientist.

1160
01:00:47,625 --> 01:00:49,166
I wasn't in R&D.

1161
01:00:49,250 --> 01:00:52,917
I was there to create
a consumer brand.

1162
01:00:53,000 --> 01:00:57,417
We came up with three adjectives
to describe Theranos:

1163
01:00:57,500 --> 01:01:00,709
simple, human, and optimistic.

1164
01:01:01,875 --> 01:01:03,917
Because there are
so many barriers

1165
01:01:04,000 --> 01:01:05,917
to getting your
blood drawn,

1166
01:01:06,000 --> 01:01:07,375
whether it's
fear of needles,

1167
01:01:07,458 --> 01:01:09,500
or fear of finding
out the results,

1168
01:01:09,875 --> 01:01:11,375
living far away,
can't afford it.

1169
01:01:11,458 --> 01:01:13,083
There's just
a lot of barriers.

1170
01:01:13,166 --> 01:01:15,291
It's like, people
that have this

1171
01:01:15,375 --> 01:01:19,166
fear or this angst or don't like it,
let's convert them.

1172
01:01:19,250 --> 01:01:22,542
So, I hired Errol Morris.

1173
01:01:23,542 --> 01:01:24,542
Errol worked with Apple.

1174
01:01:24,625 --> 01:01:26,875
Did a lot of great
work with Apple.

1175
01:01:26,959 --> 01:01:29,291
And Elizabeth was
taken by that.

1176
01:01:29,375 --> 01:01:31,834
This could be potentially
the Apple of health care.

1177
01:01:31,917 --> 01:01:33,000
Exactly.

1178
01:01:33,083 --> 01:01:36,500
- I'm a fan.
- Well, likewise.

1179
01:01:40,917 --> 01:01:42,000
We did casting.

1180
01:01:42,083 --> 01:01:44,959
Real people that have
all these issues.

1181
01:01:45,041 --> 01:01:47,500
We did also reach out
to existing Theranos customers,

1182
01:01:47,583 --> 01:01:50,583
and had several of them come
and tell their real story

1183
01:01:50,667 --> 01:01:52,291
and their experience
with Theranos.

1184
01:01:52,375 --> 01:01:53,917
- Hello!
- Hi.

1185
01:01:54,000 --> 01:01:55,959
Thank you for coming in.

1186
01:01:57,125 --> 01:01:58,959
A-mark.

1187
01:01:59,041 --> 01:02:00,917
So, as usual,
I have no idea

1188
01:02:01,000 --> 01:02:03,750
what questions to ask
or where to start.

1189
01:02:05,709 --> 01:02:07,208
I think we'll figure it out.

1190
01:02:08,583 --> 01:02:10,709
There are so many people
that don't have insurance

1191
01:02:10,792 --> 01:02:12,375
and can't afford insurance.

1192
01:02:12,458 --> 01:02:13,875
I was going to doctors,

1193
01:02:13,959 --> 01:02:15,935
and I couldn't afford it.
I was paying out of pocket.

1194
01:02:15,959 --> 01:02:18,333
If you're trying to live a life,
it gets in the way of it.

1195
01:02:18,417 --> 01:02:19,935
And if I could receive
this information,

1196
01:02:19,959 --> 01:02:22,792
without having to spend all
of this money along the way,

1197
01:02:22,875 --> 01:02:24,166
that would be amazing.

1198
01:02:24,250 --> 01:02:26,792
Eight hundred dollars
for a series of blood tests?

1199
01:02:26,875 --> 01:02:28,959
- It can be pretty stressful.
- It's expensive.

1200
01:02:29,041 --> 01:02:30,709
It's ridiculous.

1201
01:02:36,083 --> 01:02:38,417
Once they went live in Arizona...

1202
01:02:38,500 --> 01:02:40,142
- Right.
- ...dealing now with real patients...

1203
01:02:40,166 --> 01:02:42,000
- Right.
- ...as opposed to R&D...

1204
01:02:42,083 --> 01:02:44,458
- That's right. Yes.
- ...you know,

1205
01:02:44,542 --> 01:02:46,583
then you begin
to wonder, like,

1206
01:02:46,667 --> 01:02:49,083
- is it...
- Well, I think here's...

1207
01:02:49,166 --> 01:02:51,083
my context for this is,

1208
01:02:51,208 --> 01:02:52,959
you know, go back
to Jobs for a minute,

1209
01:02:53,041 --> 01:02:54,834
and all the people
that said no to him,

1210
01:02:54,917 --> 01:02:56,583
and he refused no,

1211
01:02:56,667 --> 01:02:59,417
and did it anyway
and proved everyone wrong.

1212
01:02:59,500 --> 01:03:03,291
So, my measure
of success at that level,

1213
01:03:03,375 --> 01:03:04,834
a visionary,

1214
01:03:04,917 --> 01:03:06,291
owns his own company,

1215
01:03:06,375 --> 01:03:08,375
in creating products
that change the world,

1216
01:03:08,458 --> 01:03:10,959
he did not give up
or give in ever.

1217
01:03:11,083 --> 01:03:13,208
So, that was
my measure of success.

1218
01:03:13,291 --> 01:03:17,083
Now, on patients,
that's a whole other thing.

1219
01:03:21,166 --> 01:03:23,083
In many states,
patients aren't allowed

1220
01:03:23,125 --> 01:03:25,458
to order their own lab tests
without a prescription.

1221
01:03:25,542 --> 01:03:29,625
Doctors are supposed to provide
guidance and oversight.

1222
01:03:29,667 --> 01:03:31,834
But Elizabeth lobbied
the state of Arizona

1223
01:03:31,959 --> 01:03:35,458
to pass a law allowing
patients to order lab tests

1224
01:03:35,500 --> 01:03:37,667
without consulting doctors.

1225
01:03:38,500 --> 01:03:40,458
Giving people the right

1226
01:03:40,500 --> 01:03:43,083
to obtain a laboratory test

1227
01:03:43,125 --> 01:03:45,375
will, by definition,

1228
01:03:45,458 --> 01:03:49,083
begin the process of
enabling them to engage

1229
01:03:49,166 --> 01:03:51,083
in their health.

1230
01:03:51,166 --> 01:03:53,625
Ms. Holmes, you are magnificent,

1231
01:03:53,667 --> 01:03:55,625
and there isn't a question

1232
01:03:55,750 --> 01:03:58,834
any of us could ever ask
that you haven't answered

1233
01:03:58,959 --> 01:04:01,083
20 or 30 times before.

1234
01:04:02,291 --> 01:04:05,875
This law would allow you
to order your own blood work,

1235
01:04:05,959 --> 01:04:07,291
and you get the results.

1236
01:04:07,375 --> 01:04:10,500
This is what
Theranos puts out.

1237
01:04:10,583 --> 01:04:11,500
It's a menu.

1238
01:04:11,583 --> 01:04:13,750
You kind of order à la carte,

1239
01:04:13,834 --> 01:04:16,000
but there are some
cautions raised

1240
01:04:16,083 --> 01:04:17,959
from the medical community.

1241
01:04:19,417 --> 01:04:21,184
You can't just look at a lab.

1242
01:04:21,208 --> 01:04:24,083
You have to look at the whole
patient, the whole person.

1243
01:04:24,166 --> 01:04:26,583
We can't write a
prescription for somebody

1244
01:04:26,667 --> 01:04:30,125
that we haven't done a
physical exam or have seen,

1245
01:04:30,208 --> 01:04:31,917
so it kind of
was like,

1246
01:04:32,000 --> 01:04:34,542
how are we going
to deal with this?

1247
01:04:34,625 --> 01:04:36,625
Low cost was very interesting
to the patients,

1248
01:04:36,709 --> 01:04:40,250
but then also being able
to order their own labs,

1249
01:04:40,333 --> 01:04:42,083
and they really liked that.

1250
01:04:43,291 --> 01:04:46,834
What made me concerned was,
as a physician,

1251
01:04:46,917 --> 01:04:48,717
you can call the lab
and ask simple questions,

1252
01:04:48,792 --> 01:04:52,083
and these are questions
that we would ask any lab.

1253
01:04:52,166 --> 01:04:55,083
But Theranos,
they weren't very transparent.

1254
01:04:55,875 --> 01:04:57,250
We tried to tell patients that,

1255
01:04:57,333 --> 01:05:00,500
"Listen, we're not getting
a lot of information

1256
01:05:00,583 --> 01:05:02,166
"about how they
do their testing,

1257
01:05:02,250 --> 01:05:04,959
and so we're kind
of unsure of them."

1258
01:05:05,834 --> 01:05:10,667
But then, Theranos started giving
out vouchers or gift cards

1259
01:05:10,750 --> 01:05:13,792
to get labs,
free labs done there.

1260
01:05:13,875 --> 01:05:17,250
And so it just kind of...
exploded.

1261
01:05:17,333 --> 01:05:19,000
Mom, you really are
an important part

1262
01:05:19,083 --> 01:05:21,083
of our family because...

1263
01:05:22,959 --> 01:05:25,542
we really love
you so much.

1264
01:05:25,625 --> 01:05:27,417
Your health is
really important to us.

1265
01:05:27,500 --> 01:05:30,500
The kids adore you.

1266
01:05:30,583 --> 01:05:32,375
Estábien, chiquita.

1267
01:05:32,458 --> 01:05:33,792
Theranos gift cards.

1268
01:05:33,875 --> 01:05:35,250
Because nothing is
more important

1269
01:05:35,333 --> 01:05:36,875
than the health
of those you love.

1270
01:05:38,417 --> 01:05:39,768
Marker.

1271
01:06:00,208 --> 01:06:03,375
Because of my
extensive background in phlebotomy,

1272
01:06:03,458 --> 01:06:05,792
they offered me
the trainer job.

1273
01:06:05,875 --> 01:06:08,709
Basically, I was training
the Walgreens technicians

1274
01:06:08,792 --> 01:06:12,375
and pharmacist to do the
fingerstick process because...

1275
01:06:13,583 --> 01:06:15,959
no one at
Walgreens had ever

1276
01:06:16,041 --> 01:06:18,750
handled blood
or bodily fluids.

1277
01:06:18,834 --> 01:06:21,125
So, talking about

1278
01:06:21,208 --> 01:06:23,792
what do you do in case
of an exposure and...

1279
01:06:23,875 --> 01:06:26,083
how do you handle
adolescents,

1280
01:06:26,166 --> 01:06:28,917
um, you know, just everything.

1281
01:06:29,000 --> 01:06:30,709
What do you do
if someone faints?

1282
01:06:35,792 --> 01:06:37,792
Our goal is to be within five miles

1283
01:06:37,875 --> 01:06:41,792
of every person's home through
the Walgreens nationally.

1284
01:06:42,625 --> 01:06:46,625
Our success will be in being
able to make it possible

1285
01:06:46,709 --> 01:06:50,125
for no one to ever have
to go through the process

1286
01:06:50,208 --> 01:06:53,500
of being stabbed by a big
needle to get blood anymore,

1287
01:06:53,583 --> 01:06:56,583
and be able to begin
to get access to this lab...

1288
01:06:56,667 --> 01:06:58,625
As I was doing my research,

1289
01:06:58,709 --> 01:07:00,625
they had about 90 tests,

1290
01:07:00,709 --> 01:07:03,166
and by the time
I was ready to publish,

1291
01:07:03,250 --> 01:07:05,417
they had over 200.

1292
01:07:05,500 --> 01:07:06,792
I wondered at the time

1293
01:07:06,875 --> 01:07:09,667
how exactly was
she miniaturizing

1294
01:07:09,750 --> 01:07:11,000
200 different tests,

1295
01:07:11,083 --> 01:07:13,208
and how exactly
were you going to get

1296
01:07:13,291 --> 01:07:16,208
all of this done
in the small analyzers?

1297
01:07:17,667 --> 01:07:20,458
And she was charging
so much less than the others,

1298
01:07:20,542 --> 01:07:24,375
so all of that
strained credulity.

1299
01:07:25,375 --> 01:07:28,500
I just didn't think that this

1300
01:07:28,583 --> 01:07:30,667
very sincere,

1301
01:07:30,750 --> 01:07:33,959
earnest, idealistic,
young woman

1302
01:07:34,041 --> 01:07:37,083
was deceiving not just me,

1303
01:07:37,166 --> 01:07:41,250
but Walgreens Corporation
and investors

1304
01:07:41,333 --> 01:07:44,625
to the tune of more than
$400 million at that point.

1305
01:07:48,583 --> 01:07:50,500
To be able to give people

1306
01:07:50,583 --> 01:07:52,500
the tools to change their life

1307
01:07:52,583 --> 01:07:55,417
is an incredible blessing.
It's a privilege.

1308
01:07:56,667 --> 01:07:58,166
Every single day,

1309
01:07:58,250 --> 01:08:01,583
I'm just so grateful for the
way in which this is unfolding.

1310
01:08:02,542 --> 01:08:04,208
It's a gift from God.

1311
01:08:16,750 --> 01:08:18,834
We have to understand that this is all about

1312
01:08:18,917 --> 01:08:22,125
wanting the world
to be a certain way,

1313
01:08:22,208 --> 01:08:24,792
and basically being able
to rationalize our actions

1314
01:08:24,875 --> 01:08:27,291
to try and make it true.

1315
01:08:27,375 --> 01:08:29,542
You have to want
a certain thing,

1316
01:08:29,625 --> 01:08:32,041
and then you should be able
to kind of bend reality,

1317
01:08:32,125 --> 01:08:35,291
or rationalize things to
allow you to do that.

1318
01:08:35,375 --> 01:08:37,208
But the other
thing is that

1319
01:08:37,291 --> 01:08:40,375
what about
reasons for good?

1320
01:08:40,458 --> 01:08:43,166
And I'll tell you
about a study we did.

1321
01:08:43,250 --> 01:08:45,583
And the experiment
works like this.

1322
01:08:45,667 --> 01:08:47,917
We give people a die,
a six-sided die,

1323
01:08:48,000 --> 01:08:50,041
and we say, "Why don't
you throw the die?"

1324
01:08:50,125 --> 01:08:52,125
And we'll pay you
whatever it comes up.

1325
01:08:52,208 --> 01:08:53,559
Comes in six,
you'll get six dollars

1326
01:08:53,583 --> 01:08:56,083
five, five dollars, four,
and so on until one.

1327
01:08:56,166 --> 01:08:59,834
But you can get paid based on
the top side or the bottom side.

1328
01:08:59,917 --> 01:09:02,750
Top or bottom, you decide,
but don't tell us.

1329
01:09:02,834 --> 01:09:05,417
So, I give you the die,
I say, "Don't tell me."

1330
01:09:05,500 --> 01:09:08,291
Think top or bottom.
You have it? You know which one?

1331
01:09:08,375 --> 01:09:10,583
Now, toss the die.

1332
01:09:12,417 --> 01:09:14,250
And let's say the die
comes five on the bottom

1333
01:09:14,333 --> 01:09:17,083
and two on the top.
And now I say,

1334
01:09:17,166 --> 01:09:19,166
"Alex, what did you pick?"

1335
01:09:19,250 --> 01:09:21,750
Now, if you picked bottom,
you say bottom, you get five dollars.

1336
01:09:21,834 --> 01:09:22,917
You pick top,

1337
01:09:23,000 --> 01:09:25,208
what do you say?
You say the truth? Top?

1338
01:09:25,291 --> 01:09:29,750
Or do you change your mind?
You say bottom and get five dollars.

1339
01:09:29,834 --> 01:09:32,125
In our experiment,
people do this 20 times.

1340
01:09:32,208 --> 01:09:33,768
And every time they
think top or bottom,

1341
01:09:33,792 --> 01:09:37,375
commit it to memory,
toss the die, and they write,

1342
01:09:37,458 --> 01:09:40,250
"Five and two.
I chose five," and so on.

1343
01:09:41,041 --> 01:09:42,559
And when you do it
20 times, you find that

1344
01:09:42,583 --> 01:09:44,333
people are extra lucky.

1345
01:09:44,417 --> 01:09:47,041
Right? And luck has
this really nice feature

1346
01:09:47,125 --> 01:09:49,750
of focusing on the six-one
die tosses, right?

1347
01:09:49,834 --> 01:09:51,750
They're extra lucky on
the six-one die tosses,

1348
01:09:51,834 --> 01:09:53,709
not so much on
the three-four.

1349
01:09:53,792 --> 01:09:54,959
That's the basic experiment.

1350
01:09:55,041 --> 01:09:57,125
Now, here's the thing
I want to tell you.

1351
01:09:57,208 --> 01:09:58,834
We do the same experiment,

1352
01:09:58,917 --> 01:10:02,250
but we connect people
to a lie detector.

1353
01:10:02,333 --> 01:10:05,875
And we ask the question of whether
the lie detector can detect it,

1354
01:10:05,959 --> 01:10:08,959
and the answer is yes,
the lie detector can detect lies,

1355
01:10:09,041 --> 01:10:11,583
not all the time,
but it can detect it.

1356
01:10:11,667 --> 01:10:13,458
In another version
of the experiment,

1357
01:10:13,542 --> 01:10:15,291
we do the same thing,

1358
01:10:15,375 --> 01:10:17,333
but people pick a charity.

1359
01:10:17,417 --> 01:10:19,458
And all the money that
they're going to make today

1360
01:10:19,542 --> 01:10:22,166
goes to that charity.
Right? For a good cause.

1361
01:10:22,250 --> 01:10:24,917
What do you think happened,
people cheat more or less?

1362
01:10:25,000 --> 01:10:27,000
People cheat more.

1363
01:10:27,083 --> 01:10:29,583
And the lie detector
stops working.

1364
01:10:30,750 --> 01:10:33,333
Why? Because what does
the lie detector detect?

1365
01:10:33,417 --> 01:10:35,875
The lie detector
detects a tension.

1366
01:10:35,959 --> 01:10:38,000
I want more money,
but I think it's wrong.

1367
01:10:38,083 --> 01:10:39,792
I want more money,
but I think it's wrong,

1368
01:10:39,875 --> 01:10:41,625
but if it's not wrong,

1369
01:10:41,709 --> 01:10:43,458
why would you worry?

1370
01:10:43,542 --> 01:10:47,000
If it's for a good cause, you can still
think of yourself as a good person,

1371
01:10:47,083 --> 01:10:51,500
and that's how things start,
and then it becomes a slippery slope.

1372
01:11:09,250 --> 01:11:10,935
I was at the Wall Street Journal

1373
01:11:10,959 --> 01:11:13,000
on the fifth floor
of the Journal newsroom

1374
01:11:13,083 --> 01:11:14,792
in midtown Manhattan.

1375
01:11:14,875 --> 01:11:16,917
I had couple weeks
prior finished

1376
01:11:17,000 --> 01:11:19,500
a long series
on Medicare fraud.

1377
01:11:19,583 --> 01:11:20,667
So, I was looking for

1378
01:11:20,750 --> 01:11:23,417
something new to
sink my teeth into,

1379
01:11:23,500 --> 01:11:25,333
and one
afternoon,

1380
01:11:25,417 --> 01:11:27,583
I'm at my desk,
my phone rings, I pick up,

1381
01:11:27,667 --> 01:11:29,750
and it's this source of mine.

1382
01:11:29,834 --> 01:11:32,125
He asked me whether I'd read
this New Yorker profile

1383
01:11:32,208 --> 01:11:33,959
of Elizabeth Holmes
that had been published

1384
01:11:34,041 --> 01:11:37,375
a couple weeks prior
in December of 2014.

1385
01:11:37,458 --> 01:11:39,250
As it turns out, I had.

1386
01:11:39,333 --> 01:11:41,709
And there was a quote
from Elizabeth Holmes

1387
01:11:41,792 --> 01:11:45,417
that Ken Auletta described
as "comically vague."

1388
01:11:45,500 --> 01:11:47,041
It sounded like the words

1389
01:11:47,125 --> 01:11:48,625
of a high school
chemistry student,

1390
01:11:48,709 --> 01:11:51,667
as opposed to a sophisticated
laboratory scientist

1391
01:11:51,750 --> 01:11:54,917
who'd really
invented new science.

1392
01:11:55,000 --> 01:11:58,083
But I might not have
done anything about it

1393
01:11:58,166 --> 01:11:59,750
if it weren't for the fact that

1394
01:11:59,834 --> 01:12:03,750
my source was now coming
to me with this tip.

1395
01:12:03,834 --> 01:12:06,917
He said there's
a laboratory director

1396
01:12:07,000 --> 01:12:09,792
who had just left Theranos
on pretty bad terms

1397
01:12:09,875 --> 01:12:12,750
because he had become
increasingly concerned

1398
01:12:12,834 --> 01:12:16,125
about the practices that
he had witnessed there.

1399
01:12:16,667 --> 01:12:18,709
My ears definitely
pricked up at that,

1400
01:12:18,792 --> 01:12:20,834
and so I made contact.

1401
01:12:20,917 --> 01:12:23,208
When I got him on the phone,

1402
01:12:23,291 --> 01:12:25,375
after trying him a few times,
he was terrified.

1403
01:12:25,458 --> 01:12:28,625
He was being hounded by the law firm

1404
01:12:28,709 --> 01:12:31,458
of the famous
lawyer David Boies.

1405
01:12:31,542 --> 01:12:34,959
One of Theranos's strokes of
genius was to hire David Boies

1406
01:12:35,041 --> 01:12:38,083
and also give him
stock in the company.

1407
01:12:38,166 --> 01:12:40,959
I mean, this is a lion
of the legal industry,

1408
01:12:41,041 --> 01:12:43,542
arguably the most well-known
lawyer in America,

1409
01:12:43,625 --> 01:12:46,959
who had represented Al Gore in in
the presidential recount in 2000.

1410
01:12:47,041 --> 01:12:50,458
Before that, won a case on
behalf of the Justice Department

1411
01:12:50,542 --> 01:12:52,083
against Microsoft,

1412
01:12:52,166 --> 01:12:55,792
and had shred Bill Gates
during 20 hours of deposition.

1413
01:12:55,875 --> 01:12:58,625
And he would later become
famous as the legal muscle

1414
01:12:58,709 --> 01:13:02,834
for Harvey Weinstein and his
attempt to silence accusers.

1415
01:13:02,917 --> 01:13:06,625
This was someone who struck
fear in many people.

1416
01:13:06,709 --> 01:13:09,834
The lab director said
that Boies was pressuring him

1417
01:13:09,917 --> 01:13:12,834
and threatening him
with litigation.

1418
01:13:12,917 --> 01:13:15,125
So, I had to agree...

1419
01:13:15,208 --> 01:13:17,375
to keep his identity
confidential.

1420
01:13:18,875 --> 01:13:23,125
He told me that the Edison
could only do a few tests,

1421
01:13:23,208 --> 01:13:25,875
and that all the other
tests on Theranos's menu,

1422
01:13:25,959 --> 01:13:29,542
and at that point,
we're talking about 250 blood tests,

1423
01:13:29,625 --> 01:13:31,667
were done on
commercially available

1424
01:13:31,750 --> 01:13:34,041
laboratory machines
that had been purchased

1425
01:13:34,125 --> 01:13:37,750
from companies like
Siemens and DiaSorin.

1426
01:13:37,834 --> 01:13:39,333
And then they were also lying

1427
01:13:39,417 --> 01:13:43,500
about the reliability and the
accuracy of the blood tests.

1428
01:13:53,000 --> 01:13:54,458
So, I went to Arizona

1429
01:13:54,542 --> 01:13:56,041
to get myself tested.

1430
01:13:56,125 --> 01:13:57,542
And so,
one morning, I went

1431
01:13:57,625 --> 01:14:00,458
to the Walgreens that
was closest to my hotel.

1432
01:14:00,542 --> 01:14:02,041
I sat down
in one of these

1433
01:14:02,125 --> 01:14:04,208
little Wellness Centers,
and the phlebotomist,

1434
01:14:04,291 --> 01:14:06,041
I heard her talking
on the phone,

1435
01:14:06,125 --> 01:14:08,709
and typing on a computer
for a few minutes,

1436
01:14:08,792 --> 01:14:11,917
and then she turned around
and she came at me

1437
01:14:12,000 --> 01:14:14,208
with a tourniquet and a syringe.

1438
01:14:17,208 --> 01:14:19,542
And I said,
"Why not a fingerstick?

1439
01:14:19,625 --> 01:14:21,000
"I thought
this was all about,

1440
01:14:21,083 --> 01:14:23,458
you know,
a fingerstick blood test."

1441
01:14:23,542 --> 01:14:25,542
She said,
"No, your order actually

1442
01:14:25,625 --> 01:14:27,875
includes tests that
require venous draw."

1443
01:14:30,000 --> 01:14:33,375
The truth is that,
before my story came out,

1444
01:14:33,458 --> 01:14:35,542
there had already been
instances of people

1445
01:14:35,625 --> 01:14:37,250
going in to get
their blood checked,

1446
01:14:37,333 --> 01:14:39,625
and they would need
to do a venipuncture

1447
01:14:39,709 --> 01:14:43,208
instead of a fingerstick
of capillary blood.

1448
01:14:43,291 --> 01:14:45,917
And so, I asked about
that a number of times,

1449
01:14:46,000 --> 01:14:50,375
and the answers were
incredibly opaque.

1450
01:14:50,458 --> 01:14:51,935
So, my question is

1451
01:14:51,959 --> 01:14:54,083
what percentage
of your tests are

1452
01:14:54,166 --> 01:14:56,250
needle rather
than finger prick?

1453
01:14:56,333 --> 01:14:59,208
I-I don't have a really good number for you

1454
01:14:59,291 --> 01:15:01,125
because it's changing.

1455
01:15:01,208 --> 01:15:03,208
And we're really confident
being able to say

1456
01:15:03,291 --> 01:15:05,959
that we're very close
to 99% being on capillary,

1457
01:15:06,041 --> 01:15:08,834
but when you try
to pinpoint a number...

1458
01:15:08,917 --> 01:15:10,834
We talking about in the next

1459
01:15:10,917 --> 01:15:13,834
- five years? One year? Two months?
- No.

1460
01:15:13,917 --> 01:15:16,291
Much less than a year,

1461
01:15:16,375 --> 01:15:17,750
without question.

1462
01:15:18,709 --> 01:15:20,500
At the time,
you didn't think that

1463
01:15:20,583 --> 01:15:23,458
that was necessarily
evidence of...

1464
01:15:23,542 --> 01:15:25,834
Absolutely not.
I actually believed her.

1465
01:15:25,917 --> 01:15:29,291
Of course, I remember
her saying it to me.

1466
01:15:29,375 --> 01:15:32,083
And... that's a lie.

1467
01:15:33,000 --> 01:15:34,041
Period.

1468
01:15:38,583 --> 01:15:40,041
So, after a year or so,

1469
01:15:40,125 --> 01:15:43,959
we started to see the
fingerstick collection dwindle,

1470
01:15:44,041 --> 01:15:47,125
and more venipuncture increase.

1471
01:15:47,208 --> 01:15:49,792
What did they tell you
about why they were switching

1472
01:15:49,875 --> 01:15:53,083
to part fingerstick
and part venipuncture?

1473
01:15:53,166 --> 01:15:56,333
They just... They didn't tell us.
It just happened.

1474
01:15:56,417 --> 01:16:01,083
We were told we would need to
say this blanketed statement:

1475
01:16:01,166 --> 01:16:03,583
"Due to the test that
your physician ordered,

1476
01:16:03,667 --> 01:16:06,375
"we have to perform
venipuncture

1477
01:16:06,458 --> 01:16:08,291
"to make sure
that we had enough

1478
01:16:08,375 --> 01:16:12,000
"sample to perform the testing.

1479
01:16:12,083 --> 01:16:14,208
Would you like to proceed?"

1480
01:16:14,291 --> 01:16:16,625
- That's it.
- That must've surprised you.

1481
01:16:16,709 --> 01:16:19,208
Yeah, it surprised
a lot of the technicians.

1482
01:16:19,291 --> 01:16:21,166
It surprised
a lot of the patients,

1483
01:16:21,250 --> 01:16:22,890
or the customers
that were coming in, too.

1484
01:16:22,917 --> 01:16:27,166
Some people, uh,
expressed profanity,

1485
01:16:27,250 --> 01:16:31,333
stormed out,
demanded their money back.

1486
01:16:31,417 --> 01:16:35,333
Then, during that whole
transition to venipuncture,

1487
01:16:35,417 --> 01:16:41,250
we had this big hiring boom where
I had to train 50 more employees

1488
01:16:41,333 --> 01:16:45,959
because now we opened up
our next 10 Wellness Centers.

1489
01:16:48,792 --> 01:16:50,333
With the Walgreens roll out,

1490
01:16:50,417 --> 01:16:52,875
the problems at
Theranos were magnified.

1491
01:16:52,959 --> 01:16:55,500
Instead of shutting down
until the Edisons could perform

1492
01:16:55,583 --> 01:16:57,583
all the tests on
the Theranos menu,

1493
01:16:57,667 --> 01:17:01,291
Elizabeth and her team
invented a workaround designed

1494
01:17:01,375 --> 01:17:04,000
to create the illusion
of a new technology.

1495
01:17:04,083 --> 01:17:08,291
For most tests, they were forced to
use venous blood, drawn with needles,

1496
01:17:08,375 --> 01:17:11,625
and to buy the same machines
used by every other lab.

1497
01:17:11,709 --> 01:17:14,250
But to keep Elizabeth's
fingerstick dream alive,

1498
01:17:14,333 --> 01:17:16,625
Theranos modified
some of those machines,

1499
01:17:16,709 --> 01:17:19,875
so they would work with
diluted capillary samples.

1500
01:17:19,959 --> 01:17:21,500
And for a handful
of patient tests,

1501
01:17:21,583 --> 01:17:24,000
the company used
the old Edison prototype

1502
01:17:24,083 --> 01:17:26,458
Elizabeth had
pitched to Walgreens.

1503
01:17:26,542 --> 01:17:29,375
What we've worked to do
is eliminate the error

1504
01:17:29,458 --> 01:17:31,417
and variability
that's associated

1505
01:17:31,500 --> 01:17:34,333
with human processing
of samples.

1506
01:17:34,417 --> 01:17:37,625
When Elizabeth says the
whole process was automated

1507
01:17:37,709 --> 01:17:39,917
from start to finish,
it was...

1508
01:17:40,000 --> 01:17:42,709
it was, uh, yeah,
that was a stretch.

1509
01:17:42,792 --> 01:17:45,750
It would sometimes take six hours

1510
01:17:45,834 --> 01:17:47,667
just to set up the system

1511
01:17:47,750 --> 01:17:50,166
before we could even
run the patient samples.

1512
01:17:50,250 --> 01:17:52,875
I was filling up containers,

1513
01:17:52,959 --> 01:17:56,458
doing so many manual
things with hands.

1514
01:17:56,542 --> 01:17:58,792
And the scary thing about
the nanotainers was they could

1515
01:17:58,875 --> 01:18:01,000
hop off your tray and they
would be on the ground,

1516
01:18:01,083 --> 01:18:03,875
and you might not be
able to spot them.

1517
01:18:05,709 --> 01:18:07,542
They had to dilute the nanotainers

1518
01:18:07,625 --> 01:18:09,458
to run it on
the Siemens machines,

1519
01:18:09,542 --> 01:18:11,959
which was not how they
were supposed to be used,

1520
01:18:12,041 --> 01:18:14,208
and so people who worked
in the clinical lab

1521
01:18:14,291 --> 01:18:16,458
were nervous about that
because they were violating

1522
01:18:16,542 --> 01:18:19,208
the operating standards
for those devices,

1523
01:18:19,291 --> 01:18:21,125
which, you know,
are rigorous standards

1524
01:18:21,208 --> 01:18:23,125
since they're
being used to test

1525
01:18:23,208 --> 01:18:24,875
people for diseases.

1526
01:18:26,166 --> 01:18:28,333
We were fudging results,

1527
01:18:28,417 --> 01:18:31,959
rerunning quality control
tests until they passed.

1528
01:18:32,041 --> 01:18:33,583
The solution at some point was,

1529
01:18:33,667 --> 01:18:35,347
"If you just throw out
that one data point,

1530
01:18:35,375 --> 01:18:36,643
then the other three
look beautiful."

1531
01:18:36,667 --> 01:18:39,417
And that's not
the way you approach

1532
01:18:39,500 --> 01:18:41,709
science that's going to be
impacting people's lives.

1533
01:18:41,792 --> 01:18:44,125
There were people who had to run tests

1534
01:18:44,208 --> 01:18:46,208
on devices that they knew
weren't working,

1535
01:18:46,291 --> 01:18:49,667
and give those
results to patients.

1536
01:18:49,750 --> 01:18:52,709
People were very upset,
you know, crying.

1537
01:18:52,792 --> 01:18:54,333
Some members of
the CLIA lab would even

1538
01:18:54,417 --> 01:18:56,792
have to call patients and
tell them that they had to go

1539
01:18:56,875 --> 01:18:59,583
to the emergency room 'cause the
lab test was, you know, so far off.

1540
01:18:59,667 --> 01:19:01,709
What really hit home for me is

1541
01:19:01,792 --> 01:19:04,542
we were starting to do
more infectious disease.

1542
01:19:04,625 --> 01:19:07,083
Hepatitis C, prostate cancer,

1543
01:19:07,166 --> 01:19:09,000
and even syphilis.

1544
01:19:09,083 --> 01:19:11,750
I was running precision testing for syphilis,

1545
01:19:11,834 --> 01:19:15,458
and there was a lot of
variability in the test,

1546
01:19:16,208 --> 01:19:19,250
but Theranos said,
"This is safe to use

1547
01:19:19,333 --> 01:19:22,417
on real
patient samples."

1548
01:19:22,500 --> 01:19:24,375
And I was kind of blown away.

1549
01:19:24,458 --> 01:19:26,083
If a hundred people
who had syphilis

1550
01:19:26,166 --> 01:19:28,792
came and got tested
on the Theranos devices,

1551
01:19:28,875 --> 01:19:31,041
we would only tell 65 of
them that they had syphilis,

1552
01:19:31,125 --> 01:19:32,709
and we would tell the other 35,

1553
01:19:32,792 --> 01:19:35,041
"You're healthy. No need
for medical intervention."

1554
01:19:35,125 --> 01:19:39,041
So, if people are

1555
01:19:39,125 --> 01:19:42,542
testing themselves for
syphilis using Theranos,

1556
01:19:42,625 --> 01:19:44,726
there's going to be a lot more
syphilis in this world.

1557
01:19:49,417 --> 01:19:51,083
Their downfall was when they started

1558
01:19:51,166 --> 01:19:54,542
giving us results that
were not matching up

1559
01:19:54,625 --> 01:19:56,959
with other labs.

1560
01:19:57,041 --> 01:19:59,834
We started seeing that,
at first, with TSHs,

1561
01:19:59,917 --> 01:20:02,834
which is the thyroid
stimulating hormone.

1562
01:20:02,917 --> 01:20:05,250
Patients that had been
coming to us for years

1563
01:20:05,333 --> 01:20:06,583
to get their TSH done,

1564
01:20:06,667 --> 01:20:08,667
they had gone to
Theranos and their labs

1565
01:20:08,750 --> 01:20:11,458
were changing
really drastically.

1566
01:20:11,542 --> 01:20:14,333
So, we started sending
them to LabCorp,

1567
01:20:14,417 --> 01:20:16,057
just to verify, and
that's when we started

1568
01:20:16,125 --> 01:20:19,083
seeing some pretty
abnormal results.

1569
01:20:19,166 --> 01:20:20,375
I understand
how a patient

1570
01:20:20,458 --> 01:20:22,333
would wanna order
their own labs,

1571
01:20:22,417 --> 01:20:25,375
but then they get it and they
don't know what to do with it,

1572
01:20:25,458 --> 01:20:27,125
or they go
on Google

1573
01:20:27,208 --> 01:20:29,709
and google everything
under the sun,

1574
01:20:29,792 --> 01:20:32,083
and see that
they have cancer, so...

1575
01:20:32,166 --> 01:20:34,375
- When they don't.
- When they don't!

1576
01:20:34,458 --> 01:20:37,834
When you read about how
many tests were actually wrong...

1577
01:20:37,917 --> 01:20:39,834
- Mm-hmm.
- ...did that concern you?

1578
01:20:39,917 --> 01:20:42,000
It did because I had
some of those tests

1579
01:20:42,083 --> 01:20:44,625
performed on me
and my children!

1580
01:20:44,709 --> 01:20:46,375
I did!

1581
01:20:46,458 --> 01:20:50,125
So, I immediately
went back to...

1582
01:20:50,208 --> 01:20:52,542
the other
big lab companies,

1583
01:20:52,625 --> 01:20:55,250
and got my test done,
the same test done,

1584
01:20:55,333 --> 01:20:58,208
and I compared them,
and there was a big difference.

1585
01:20:58,458 --> 01:21:01,125
So, yeah, it was scary.

1586
01:21:01,208 --> 01:21:02,458
It was very scary.

1587
01:21:05,291 --> 01:21:08,291
There are so many people
who reach out to us and thank us.

1588
01:21:08,375 --> 01:21:11,417
This one guy, he said,
"Thank God for Theranos."

1589
01:21:11,500 --> 01:21:13,434
I mean, how many times you
say that about companies?

1590
01:21:13,458 --> 01:21:16,792
You buy a product, and do you
ever say, "Thank God for Uber?"

1591
01:21:16,875 --> 01:21:18,500
Well, maybe sometimes, but...

1592
01:21:18,583 --> 01:21:20,208
But you will say

1593
01:21:20,333 --> 01:21:22,333
thank God for
Theranos every day,

1594
01:21:22,417 --> 01:21:24,542
because every time
you need a lab test,

1595
01:21:24,625 --> 01:21:26,333
every time your
family needs a test...

1596
01:21:26,417 --> 01:21:28,000
I couldn't feel comfortable

1597
01:21:28,083 --> 01:21:30,583
with running these
tests on patients

1598
01:21:30,667 --> 01:21:31,959
because,
at the end of the day,

1599
01:21:32,041 --> 01:21:33,625
I wouldn't run them
on myself.

1600
01:21:33,709 --> 01:21:36,000
I wouldn't run them
on my family members.

1601
01:21:36,083 --> 01:21:38,583
And it just didn't
make sense that,

1602
01:21:38,667 --> 01:21:41,333
internally,
we had so little faith

1603
01:21:41,417 --> 01:21:42,583
in these tests,

1604
01:21:42,667 --> 01:21:45,375
but we're still resulting
them on patients.

1605
01:21:45,458 --> 01:21:47,125
Unprecedented transparency...

1606
01:21:47,208 --> 01:21:49,375
I finally decided enough is enough.

1607
01:21:49,458 --> 01:21:52,417
I went into Sunny's
office and I said,

1608
01:21:52,500 --> 01:21:54,000
"We're not letting
patients know

1609
01:21:54,083 --> 01:21:57,667
when these results are false
or when we make a mistake."

1610
01:21:57,750 --> 01:22:00,667
And effectively,
what he did is said,

1611
01:22:00,750 --> 01:22:04,750
"What makes you think you're
qualified to make that call?"

1612
01:22:04,834 --> 01:22:07,542
And, "You need to just
sit down and do your job."

1613
01:22:07,625 --> 01:22:09,417
Thank you.

1614
01:22:09,500 --> 01:22:11,208
At that point, I knew.

1615
01:22:11,291 --> 01:22:13,542
It's just unacceptable
what this company is doing,

1616
01:22:13,625 --> 01:22:15,417
and I don't want to be
a part of that.

1617
01:22:15,500 --> 01:22:17,959
The kind of technologies
that you're building

1618
01:22:18,041 --> 01:22:21,375
practically are changing
people's lives every single day.

1619
01:22:21,458 --> 01:22:25,125
I couldn't understand how
someone could continuously lie.

1620
01:22:25,208 --> 01:22:27,083
It really changed
my perception of her.

1621
01:22:27,166 --> 01:22:28,875
That, okay, this person,

1622
01:22:28,959 --> 01:22:30,709
you know, plays this role of,

1623
01:22:30,792 --> 01:22:33,083
you know, wanting to make
health care more accessible,

1624
01:22:33,166 --> 01:22:36,542
of really trying to leverage
innovative new technologies

1625
01:22:36,625 --> 01:22:39,750
to solve this huge problem
that we have in health care,

1626
01:22:39,834 --> 01:22:41,125
but it's all a show.

1627
01:22:41,208 --> 01:22:43,792
I grew up spending summers

1628
01:22:43,875 --> 01:22:46,583
and the holidays...

1629
01:22:46,667 --> 01:22:50,041
- ...with my uncle. I remember how much I loved him.
- I have a really vivid memory.

1630
01:22:50,125 --> 01:22:51,917
- I loved him so much.
- He was fine.

1631
01:22:52,000 --> 01:22:54,959
He was diagnosed one
day with skin cancer...

1632
01:22:55,041 --> 01:22:57,875
All of a sudden, - And one day,
he has brain cancer...

1633
01:22:57,959 --> 01:23:00,417
- And in his bones...
- All of a sudden...

1634
01:23:00,500 --> 01:23:02,750
He was gone before
I ever got to...

1635
01:23:02,834 --> 01:23:05,375
- My uncle...
- My uncle...

1636
01:23:20,291 --> 01:23:22,083
When I think of Theranos,

1637
01:23:22,166 --> 01:23:25,166
I really feel like there were
two entirely different worlds.

1638
01:23:25,291 --> 01:23:26,917
There was the carpeted world,

1639
01:23:27,000 --> 01:23:29,625
and there was the tiled world.

1640
01:23:29,709 --> 01:23:32,917
In the carpeted world was
where Elizabeth was a goddess.

1641
01:23:33,000 --> 01:23:36,417
Everyone almost worshiped
the ground she walked on.

1642
01:23:36,500 --> 01:23:40,917
She could do no wrong.
She was the next Steve Jobs.

1643
01:23:41,000 --> 01:23:43,208
Theranos was
changing the world.

1644
01:23:43,291 --> 01:23:46,375
And then you go into the tiled
side and nothing works.

1645
01:23:46,458 --> 01:23:48,166
We're on a sinking ship.

1646
01:23:48,250 --> 01:23:50,250
Everything's a lie.

1647
01:23:50,333 --> 01:23:52,250
Reconciling
the differences between

1648
01:23:52,333 --> 01:23:54,917
those two worlds was
really hard for me to do.

1649
01:23:55,000 --> 01:23:57,500
I knew Elizabeth personally
from all these

1650
01:23:57,583 --> 01:24:00,208
interactions
through my family,

1651
01:24:00,875 --> 01:24:03,166
so I really trusted her.
I believed in her.

1652
01:24:03,250 --> 01:24:05,291
I would leave
the tiled world thinking,

1653
01:24:05,375 --> 01:24:06,667
"Oh man, sinking ship."

1654
01:24:06,750 --> 01:24:08,559
And I would go have one
conversation with Elizabeth.

1655
01:24:08,583 --> 01:24:11,000
Theranos was founded with the goal

1656
01:24:11,083 --> 01:24:13,500
of creating a more human,
actionable health experience.

1657
01:24:13,583 --> 01:24:16,000
If you can begin to understand your body...

1658
01:24:16,083 --> 01:24:18,500
And I would be so
motivated to go back and work,

1659
01:24:18,583 --> 01:24:20,423
and I felt like I was
changing the world again.

1660
01:24:20,500 --> 01:24:22,166
And I would go back
into the tiled world,

1661
01:24:22,250 --> 01:24:24,583
and I would go, wait,
what just happened?

1662
01:24:24,667 --> 01:24:27,542
You want it
to be true so badly,

1663
01:24:27,625 --> 01:24:31,500
and even for me, I was
working with these devices

1664
01:24:31,583 --> 01:24:32,834
every single day,

1665
01:24:32,917 --> 01:24:35,500
and she could still
kind of convince me.

1666
01:24:37,083 --> 01:24:38,834
When I think back
on those conversations,

1667
01:24:38,917 --> 01:24:41,417
I just think,
how did she do that?

1668
01:24:44,750 --> 01:24:47,542
You start to believe that
maybe you're the one who's crazy.

1669
01:24:47,625 --> 01:24:49,625
Because everyone else
thinks this woman's great,

1670
01:24:49,709 --> 01:24:51,267
and everyone else wants
to throw money at her,

1671
01:24:51,291 --> 01:24:54,875
wants to be on board with this,
and wants to be a part of it.

1672
01:24:54,959 --> 01:24:57,625
I mean, at the time,
she was this iconic figure,

1673
01:24:57,709 --> 01:24:59,917
this woman in tech who was
revolutionizing everything,

1674
01:25:00,000 --> 01:25:03,041
this Steve Jobs imitation.

1675
01:25:03,125 --> 01:25:05,458
Sometimes, you have to think
maybe you're wrong.

1676
01:25:10,959 --> 01:25:13,417
At the time,
you wondered whether

1677
01:25:13,500 --> 01:25:17,375
Elizabeth's connections
were protecting her.

1678
01:25:17,458 --> 01:25:21,083
It kind of caused a bit
of a crisis of faith

1679
01:25:21,166 --> 01:25:25,208
in, you know, just the power
of government, and how

1680
01:25:25,291 --> 01:25:27,291
corrupt or not they were for me.

1681
01:25:27,375 --> 01:25:29,709
I thought that Theranos
was going to get away with it.

1682
01:25:32,917 --> 01:25:35,166
You're charging historically low prices,

1683
01:25:35,250 --> 01:25:37,917
which is
a small fraction

1684
01:25:38,000 --> 01:25:40,000
of what is
charged now,

1685
01:25:40,083 --> 01:25:42,250
and while maintaining
the highest standards.

1686
01:25:42,333 --> 01:25:45,083
With all her political connections,

1687
01:25:45,166 --> 01:25:48,125
she was chummy with
the Obama administration.

1688
01:25:48,208 --> 01:25:50,083
The bet that she made was that

1689
01:25:50,166 --> 01:25:53,083
if she surrounded herself
with powerful people,

1690
01:25:53,166 --> 01:25:56,333
the regulators wouldn't get
confrontational with her.

1691
01:25:57,208 --> 01:25:58,542
The end game, I think,

1692
01:25:58,625 --> 01:26:01,500
it comes back to
"fake it until you make it."

1693
01:26:02,667 --> 01:26:05,583
Elizabeth never gave up
on her ultimate vision

1694
01:26:05,667 --> 01:26:08,250
to get the device
not only in stores,

1695
01:26:08,333 --> 01:26:11,083
but ultimately,
in the homes of patients.

1696
01:26:11,166 --> 01:26:13,750
She wanted to be like
Apple and Steve Jobs,

1697
01:26:13,834 --> 01:26:18,208
in the sense that Apple
devices are ubiquitous.

1698
01:26:18,291 --> 01:26:21,583
She wanted Edison devices
in every home in America.

1699
01:26:24,166 --> 01:26:27,667
The only thing is you need FDA
approval to make that happen.

1700
01:26:33,792 --> 01:26:37,250
I did talk to the Chief
Medical person at the FDA,

1701
01:26:37,333 --> 01:26:40,291
who expressed some
skepticism. He said...

1702
01:26:40,375 --> 01:26:42,768
"They have not provided enough information

1703
01:26:42,792 --> 01:26:46,250
for the agency to clear
or approve the test."

1704
01:26:46,333 --> 01:26:47,709
Accurate?

1705
01:26:47,792 --> 01:26:49,250
So, is this something that

1706
01:26:49,333 --> 01:26:51,792
- you wanted actually to use in the article?
- Yes.

1707
01:26:51,875 --> 01:26:53,542
Okay,
so that's part of a challenge

1708
01:26:53,625 --> 01:26:55,875
because that our legal team
is so concerned about this

1709
01:26:55,959 --> 01:26:58,250
because there's a lot
of context behind that.

1710
01:26:58,333 --> 01:27:00,500
It creates... causes
a lot of problems for us.

1711
01:27:00,583 --> 01:27:02,223
That's why I'm asking for context.

1712
01:27:02,250 --> 01:27:05,333
Give it to me. I'm all ears.

1713
01:27:05,417 --> 01:27:07,500
Okay,
let me talk to our legal team.

1714
01:27:07,583 --> 01:27:10,750
Right now, they told me that
I can't comment on this...

1715
01:27:10,834 --> 01:27:12,291
Elizabeth was tap dancing

1716
01:27:12,375 --> 01:27:14,458
around her discussions
with the FDA.

1717
01:27:14,542 --> 01:27:16,667
Rather than submit
full applications,

1718
01:27:16,750 --> 01:27:20,458
Theranos flooded the FDA with
vague exploratory letters,

1719
01:27:20,542 --> 01:27:22,125
trying to stall for time,

1720
01:27:22,208 --> 01:27:23,959
till the Edisons
could do all the tests

1721
01:27:24,041 --> 01:27:25,834
that Theranos advertised,

1722
01:27:25,917 --> 01:27:27,500
and that could take years.

1723
01:27:29,125 --> 01:27:32,000
In the meantime, the Theranos
operation in Palo Alto

1724
01:27:32,083 --> 01:27:34,000
was being regulated by CMS,

1725
01:27:34,083 --> 01:27:37,375
the federal agency
in charge of clinical labs.

1726
01:27:37,458 --> 01:27:40,125
Theranos was also
playing games with them.

1727
01:27:40,208 --> 01:27:43,458
Even though some patient tests
were performed on Edisons,

1728
01:27:43,542 --> 01:27:45,750
Theranos never reported those.

1729
01:27:45,834 --> 01:27:49,834
The company only gave CMS the
data from third-party machines.

1730
01:27:50,583 --> 01:27:51,750
The decision was

1731
01:27:51,834 --> 01:27:54,000
let's send what was
on the Immulite

1732
01:27:54,083 --> 01:27:55,125
and on the Siemens Advia.

1733
01:27:55,208 --> 01:27:58,041
Let's not send
the Edison results.

1734
01:27:58,125 --> 01:27:59,267
And that really freaked me out

1735
01:27:59,291 --> 01:28:00,875
because that was
suggesting that,

1736
01:28:00,959 --> 01:28:03,625
okay, we didn't trust
the Edison test.

1737
01:28:03,709 --> 01:28:05,709
And here, we were able
to make that discernment

1738
01:28:05,792 --> 01:28:08,291
of what was
the appropriate one to send,

1739
01:28:08,375 --> 01:28:10,458
but we weren't doing
that with patients.

1740
01:28:12,291 --> 01:28:15,208
And when CMS came in
for the inspection,

1741
01:28:15,291 --> 01:28:17,959
Sunny and Elizabeth
only showed them the lab

1742
01:28:18,041 --> 01:28:20,458
with the Siemens Advia,
the Immulite.

1743
01:28:20,542 --> 01:28:23,542
They never took them downstairs
to the secondary lab,

1744
01:28:23,625 --> 01:28:27,125
where we processed all the
fingersticks on the Edisons.

1745
01:28:27,208 --> 01:28:28,834
They strictly told us

1746
01:28:28,917 --> 01:28:30,375
to stay at your desk.

1747
01:28:30,458 --> 01:28:31,959
They didn't want
any of us down there

1748
01:28:32,041 --> 01:28:33,917
'cause they were scared
if the inspectors

1749
01:28:34,000 --> 01:28:37,417
saw what was going on, that
could have huge consequences.

1750
01:28:37,500 --> 01:28:40,583
It just seemed
scandalous to us.

1751
01:28:40,667 --> 01:28:44,542
It was getting to the point
where there was really no hope.

1752
01:28:44,625 --> 01:28:46,083
You know,
I'd pretty much decided

1753
01:28:46,166 --> 01:28:48,166
that I was
going to quit.

1754
01:28:51,750 --> 01:28:53,417
Right after I resigned,

1755
01:28:53,500 --> 01:28:57,208
I went to my grandfather's
office at Stanford,

1756
01:28:57,291 --> 01:28:59,542
and actually showed
him a lot of data,

1757
01:28:59,625 --> 01:29:02,041
and the discrepancy
between what I was seeing

1758
01:29:02,125 --> 01:29:03,417
and what was being published,

1759
01:29:03,500 --> 01:29:06,083
and the explanation
for those differences.

1760
01:29:06,166 --> 01:29:10,500
But he didn't really seem
to believe what I was saying,

1761
01:29:10,583 --> 01:29:12,500
and he said,
"Elizabeth has told me that

1762
01:29:12,583 --> 01:29:15,375
"Theranos really can do all the
things that it says it can do.

1763
01:29:15,458 --> 01:29:18,041
"Theranos is more accurate,
going to change the world.

1764
01:29:18,125 --> 01:29:20,375
"They're trying to convince
me that you're stupid.

1765
01:29:20,458 --> 01:29:21,935
"They can't convince
me that you're stupid,

1766
01:29:21,959 --> 01:29:23,875
"but they can convince
me that you're wrong.

1767
01:29:23,959 --> 01:29:25,709
"And I do think
that you're wrong,

1768
01:29:25,792 --> 01:29:27,959
so move on with your life."

1769
01:29:31,333 --> 01:29:33,375
A few months afterwards,

1770
01:29:33,458 --> 01:29:36,166
John Carreyou from
the Wall Street Journal

1771
01:29:36,250 --> 01:29:39,291
sent me a message on LinkedIn.

1772
01:29:39,375 --> 01:29:41,333
I was definitely in a panic.

1773
01:29:41,417 --> 01:29:42,726
There were
confidentiality agreements

1774
01:29:42,750 --> 01:29:44,390
that I had signed
while I was at Theranos.

1775
01:29:44,458 --> 01:29:47,291
So, I went and bought
a burner phone with cash.

1776
01:29:47,375 --> 01:29:50,500
I called him,
and in that phone call,

1777
01:29:50,583 --> 01:29:52,500
I decided that I wanted
to help him out.

1778
01:29:53,917 --> 01:29:57,667
I said, my grandfather
made it through Watergate,

1779
01:29:57,750 --> 01:29:59,166
and the Iran-Contra scandal

1780
01:29:59,250 --> 01:30:02,583
with his integrity
completely intact.

1781
01:30:02,667 --> 01:30:04,709
Once he becomes aware of
the fraud that's happening,

1782
01:30:04,792 --> 01:30:07,667
he will do everything
he can to make things right.

1783
01:30:07,750 --> 01:30:09,267
And I want to give
him that opportunity

1784
01:30:09,291 --> 01:30:12,917
because, I think he was 94,
95 at the time.

1785
01:30:14,375 --> 01:30:16,667
So, I met with John in person,

1786
01:30:16,750 --> 01:30:19,375
and then he sent Theranos

1787
01:30:19,458 --> 01:30:21,500
some prodding questions,

1788
01:30:21,583 --> 01:30:24,291
and there was just
one number in there.

1789
01:30:24,375 --> 01:30:27,667
42.9% that I had calculated
for one of these tests,

1790
01:30:27,750 --> 01:30:31,166
that was also in an e-mail
that I had sent to Elizabeth.

1791
01:30:35,458 --> 01:30:36,875
About a month after that,

1792
01:30:36,959 --> 01:30:39,542
I went to go have dinner
with my parents.

1793
01:30:39,625 --> 01:30:41,542
I walk in the door,
and my dad says,

1794
01:30:41,625 --> 01:30:44,375
"Have you been speaking to a
Wall Street Journal reporter?"

1795
01:30:44,458 --> 01:30:47,375
And I said yes.

1796
01:30:47,458 --> 01:30:49,250
And he said,
"Well, they know."

1797
01:30:55,041 --> 01:30:56,458
After I leave Theranos,

1798
01:30:56,542 --> 01:30:59,875
I kind of want to be as far
away from them as possible.

1799
01:30:59,959 --> 01:31:02,792
I was working another job,
and at this point,

1800
01:31:02,875 --> 01:31:06,250
I had talked to John Carreyrou
from the Wall Street Journal,

1801
01:31:06,333 --> 01:31:08,542
who was doing
an investigative report.

1802
01:31:11,542 --> 01:31:13,917
So, I'm at work one day.
I'm working late,

1803
01:31:14,000 --> 01:31:15,792
and two of my
colleagues are leaving,

1804
01:31:15,875 --> 01:31:17,917
and I'm going to be
the only one in the building.

1805
01:31:18,000 --> 01:31:20,125
And they look outside,
and they're like, "Hey, Erika.

1806
01:31:20,208 --> 01:31:22,008
"There's been this guy
who's just been sitting

1807
01:31:22,041 --> 01:31:25,750
in our parking lot
for the whole day."

1808
01:31:25,834 --> 01:31:28,458
And that's very unusual.

1809
01:31:31,417 --> 01:31:34,083
So, they walk me to my car,

1810
01:31:34,166 --> 01:31:37,500
and then this guy comes up,
and he gives me this letter.

1811
01:31:37,583 --> 01:31:40,166
And it has the address
of this temporary home

1812
01:31:40,250 --> 01:31:43,750
that I'm staying at,
so no one knows this address.

1813
01:31:43,834 --> 01:31:47,166
And I open it, and it's
a letter from David Boies.

1814
01:31:48,000 --> 01:31:50,458
"If you don't come forward with

1815
01:31:50,542 --> 01:31:53,291
"X, Y, and Z document,
or report these people,

1816
01:31:53,375 --> 01:31:55,875
there's a potential
that we could sue you."

1817
01:31:57,166 --> 01:31:59,333
It was quite,
quite scary for me.

1818
01:31:59,417 --> 01:32:01,333
Especially coming
from a position of,

1819
01:32:01,417 --> 01:32:03,834
what, I was 23 at that point?

1820
01:32:03,917 --> 01:32:06,375
You know, I had not really

1821
01:32:06,458 --> 01:32:09,333
not really any money to spend
on lawyers or anything.

1822
01:32:09,417 --> 01:32:11,166
I was really freaked out.

1823
01:32:14,250 --> 01:32:16,250
I'd been asking for an interview

1824
01:32:16,333 --> 01:32:18,166
with Elizabeth
for several months,

1825
01:32:18,250 --> 01:32:21,083
and they were giving
me the runaround.

1826
01:32:21,166 --> 01:32:24,166
Finally, in June 2015,

1827
01:32:24,250 --> 01:32:27,583
we agreed that we'd have a
meeting at the Journal offices.

1828
01:32:28,875 --> 01:32:31,834
This Theranos delegation
comes in, it's seven people,

1829
01:32:31,917 --> 01:32:33,750
four of whom are lawyers,

1830
01:32:33,834 --> 01:32:37,875
led by David Boies, and one of the
other lawyers is Heather King...

1831
01:32:37,959 --> 01:32:40,083
Heather has just joined
us as our general counsel.

1832
01:32:40,166 --> 01:32:43,208
...who had been a Boies Schiller partner,

1833
01:32:43,291 --> 01:32:45,792
former Hillary Clinton aide.

1834
01:32:45,875 --> 01:32:49,000
Couple of minutes into
the meeting, Heather King

1835
01:32:49,083 --> 01:32:51,500
puts a little tape recorder
down on the table.

1836
01:32:51,583 --> 01:32:52,875
Another Boies Schiller attorney

1837
01:32:52,959 --> 01:32:54,875
put a little tape recorder

1838
01:32:54,959 --> 01:32:56,667
on the other end of
the conference table,

1839
01:32:56,750 --> 01:32:58,250
and it was very clear

1840
01:32:58,333 --> 01:33:00,000
that they were approaching this

1841
01:33:00,083 --> 01:33:02,417
as a deposition
in a legal proceeding.

1842
01:33:02,500 --> 01:33:05,417
If they were going to record,
then I was going to record as well.

1843
01:33:05,500 --> 01:33:07,959
Okay, so,
you know, we're here today

1844
01:33:08,041 --> 01:33:11,083
to do our part to help
educate you on what

1845
01:33:11,166 --> 01:33:12,750
I, at least, believe are some,

1846
01:33:12,834 --> 01:33:15,792
you know, false premises upon
which the questions are based.

1847
01:33:15,875 --> 01:33:19,208
They're very serious questions,
and there's some very serious

1848
01:33:19,291 --> 01:33:22,083
allegations in those questions.

1849
01:33:22,166 --> 01:33:24,083
I also turn to David Boies.

1850
01:33:24,166 --> 01:33:26,250
David attends all
the board meetings.

1851
01:33:26,333 --> 01:33:29,375
We wouldn't be here,
spend all this time and effort

1852
01:33:29,458 --> 01:33:31,375
if the, you know,

1853
01:33:31,458 --> 01:33:34,267
- we've got a technology...
- So, why don't we discuss it more freely?

1854
01:33:34,291 --> 01:33:36,625
Yeah, because it's trade secret!
That's why!

1855
01:33:36,709 --> 01:33:38,542
And because you
won't sign an NDA!

1856
01:33:38,625 --> 01:33:40,184
Is there really new technology?

1857
01:33:40,208 --> 01:33:41,417
That's the point.

1858
01:33:41,500 --> 01:33:43,041
Is it really new technology...

1859
01:33:43,125 --> 01:33:45,125
This something no one's
been able to do before.

1860
01:33:45,208 --> 01:33:47,375
Okay? Theranos is doing it.

1861
01:33:47,458 --> 01:33:51,500
And unless it's magic, it's a new technology.

1862
01:33:51,583 --> 01:33:53,875
I knew that most
of their blood tests

1863
01:33:53,959 --> 01:33:56,375
were run on
commercial analyzers

1864
01:33:56,458 --> 01:33:58,417
made by third
party companies.

1865
01:33:58,500 --> 01:34:01,375
And so I said,
how can this even fall

1866
01:34:01,458 --> 01:34:03,834
under the bucket
of trade secrets,

1867
01:34:03,917 --> 01:34:05,583
if these aren't even
Theranos machines.

1868
01:34:05,667 --> 01:34:08,417
Are you saying that
the trade secrets also covers

1869
01:34:08,500 --> 01:34:10,583
the way in which you
run a blood sample

1870
01:34:10,667 --> 01:34:12,000
on the Siemens Advia?

1871
01:34:12,083 --> 01:34:14,166
I think,
I don't know the answer to that,

1872
01:34:14,250 --> 01:34:16,917
but I can tell you that
it could or it could not.

1873
01:34:17,000 --> 01:34:19,680
It just feels like you want
us to give you the formula for Coke

1874
01:34:19,750 --> 01:34:21,685
in order to convince you that
it doesn't contain arsenic.

1875
01:34:21,709 --> 01:34:23,393
Nobody's asked for the formula for Coke.

1876
01:34:23,417 --> 01:34:25,166
We're looking for
a generic explanation.

1877
01:34:25,250 --> 01:34:27,083
You don't need to know how they work.

1878
01:34:30,917 --> 01:34:33,166
It sounds like the Wizard of Oz...

1879
01:34:33,291 --> 01:34:35,250
So, we went around in circles,

1880
01:34:35,333 --> 01:34:39,000
and the fact that
they were stonewalling

1881
01:34:39,083 --> 01:34:41,917
in such a strong way,

1882
01:34:42,000 --> 01:34:44,583
made me feel like
we were on the right track.

1883
01:34:44,667 --> 01:34:48,375
You know,
it seems apparent to us that certainly

1884
01:34:48,458 --> 01:34:51,458
one of your key sources is
a young man named Tyler Shultz

1885
01:34:51,542 --> 01:34:53,667
because the concerns
that you are raising

1886
01:34:53,750 --> 01:34:55,166
precisely are concerns

1887
01:34:55,250 --> 01:34:57,000
that he raised in
the very brief time

1888
01:34:57,083 --> 01:34:58,667
that he was at our company.

1889
01:34:58,750 --> 01:35:00,393
I don't know, I don't
remember his exact words,

1890
01:35:00,417 --> 01:35:02,417
but he said, "Well,
they know. They know."

1891
01:35:02,500 --> 01:35:04,917
So, I called my grandfather
and he said,

1892
01:35:05,000 --> 01:35:08,208
"Elizabeth tells me that
you've been speaking...

1893
01:35:08,291 --> 01:35:10,500
"that you've been giving
trade secrets away

1894
01:35:10,583 --> 01:35:12,208
"to the Wall Street Journal,

1895
01:35:12,291 --> 01:35:15,542
"and, you know, if this
story gets published,

1896
01:35:15,625 --> 01:35:19,208
"that essentially, your career
will be ruined, but...

1897
01:35:19,291 --> 01:35:21,667
"there's a one-page
confidentiality agreement

1898
01:35:21,750 --> 01:35:23,709
you can sign to just
make it all go away."

1899
01:35:23,792 --> 01:35:27,834
And so, I go to his house the next morning,
and he said, "Okay, well,

1900
01:35:27,917 --> 01:35:31,000
there are actually two Theranos
lawyers here right now."

1901
01:35:31,083 --> 01:35:32,625
I was...

1902
01:35:32,709 --> 01:35:35,333
extremely nervous about
what was going to happen,

1903
01:35:35,417 --> 01:35:37,250
very uncomfortable
with the whole situation.

1904
01:35:37,333 --> 01:35:39,500
They come in
and they give me

1905
01:35:39,583 --> 01:35:43,375
a notice to appear in court
in about 36 hours,

1906
01:35:43,458 --> 01:35:46,125
a temporary restraining order,

1907
01:35:46,208 --> 01:35:49,917
and a letter signed
by David Boies.

1908
01:35:50,000 --> 01:35:53,083
They really made me feel
like I was alone.

1909
01:35:53,166 --> 01:35:55,500
I was the underdog.
I was going to get crushed.

1910
01:35:55,583 --> 01:35:57,750
Good morning,
Mr. Secretary.

1911
01:35:57,834 --> 01:35:59,083
Good morning.

1912
01:35:59,166 --> 01:36:02,208
Do you recall a time when
Tyler came to your home,

1913
01:36:02,291 --> 01:36:03,500
and there were
some attorneys

1914
01:36:03,583 --> 01:36:05,250
from the Boies
Schiller firm there?

1915
01:36:05,333 --> 01:36:07,500
I wouldn't call them attorneys.

1916
01:36:07,583 --> 01:36:11,083
The man was some
sort of an animal.

1917
01:36:12,166 --> 01:36:14,250
Wild animal,

1918
01:36:14,333 --> 01:36:17,208
and he assaulted my grandson.

1919
01:36:17,291 --> 01:36:20,041
Was one of the dumbest
things I've ever observed.

1920
01:36:20,125 --> 01:36:22,959
When you say that
the man assaulted

1921
01:36:23,041 --> 01:36:24,250
your grandson,
can you be...

1922
01:36:24,333 --> 01:36:27,333
Verbally, verbally,
he just went after him.

1923
01:36:27,417 --> 01:36:28,792
If it hadn't ended when it did,

1924
01:36:28,875 --> 01:36:30,750
my wife was about
to pick an iron out,

1925
01:36:30,834 --> 01:36:33,959
hand iron right out of the
fireplace and clobber him.

1926
01:36:36,625 --> 01:36:38,750
My grandfather physically separates us,

1927
01:36:38,834 --> 01:36:40,959
and puts the Theranos
lawyers in the living room,

1928
01:36:41,041 --> 01:36:42,417
and I'm in the dining room,

1929
01:36:42,500 --> 01:36:44,625
and he's going between
the two rooms negotiating...

1930
01:36:44,709 --> 01:36:47,750
- Like a Secretary of State.
- Like a Secretary of State.

1931
01:36:47,834 --> 01:36:52,500
And my grandfather
seemed like he had grown...

1932
01:36:52,583 --> 01:36:55,917
that his allegiance to Elizabeth and
Theranos had grown even stronger.

1933
01:36:56,000 --> 01:36:58,375
Do you have
a high opinion of Ms. Holmes?

1934
01:36:58,458 --> 01:37:00,083
Yes.

1935
01:37:00,166 --> 01:37:02,792
Do you believe that
Ms. Holmes was truthful

1936
01:37:02,875 --> 01:37:05,208
with you in all of your
interactions with her?

1937
01:37:05,291 --> 01:37:06,792
Yes, I think so.

1938
01:37:06,875 --> 01:37:08,959
In any of her
interactions with you,

1939
01:37:09,041 --> 01:37:11,583
did Ms. Holmes
ever do anything

1940
01:37:11,667 --> 01:37:13,083
to give you
reason to believe

1941
01:37:13,166 --> 01:37:15,125
that she was trying
to deceive you?

1942
01:37:15,208 --> 01:37:16,333
No.

1943
01:37:18,125 --> 01:37:19,417
Yeah, that's when...

1944
01:37:19,500 --> 01:37:22,291
lawyers became a really
big part of my life.

1945
01:37:22,375 --> 01:37:24,458
They were threatening
to sue me for

1946
01:37:24,542 --> 01:37:26,458
violating my
nondisclosure agreement,

1947
01:37:26,542 --> 01:37:28,625
for giving up trade secrets.

1948
01:37:28,709 --> 01:37:31,667
Many times, I had written
notices to appear in court,

1949
01:37:31,750 --> 01:37:34,875
and at the last minute,
they would cancel it.

1950
01:37:35,834 --> 01:37:37,083
Overall, my parents

1951
01:37:37,166 --> 01:37:40,667
spent between
400 and $500,000

1952
01:37:40,750 --> 01:37:42,709
in legal fees.

1953
01:37:42,792 --> 01:37:44,250
It was getting
to the point where

1954
01:37:44,333 --> 01:37:47,417
we needed to find money
somewhere, so they...

1955
01:37:47,500 --> 01:37:49,250
they said that they
would sell their house

1956
01:37:49,333 --> 01:37:51,000
to keep fighting
this legal battle.

1957
01:37:53,542 --> 01:37:55,834
So,
I ended up talking to a lawyer,

1958
01:37:55,917 --> 01:37:57,792
and they said, they're
trying to scare you.

1959
01:37:57,875 --> 01:38:01,208
And he said, one of the options that
you can do is you can whistle-blow.

1960
01:38:01,333 --> 01:38:04,458
You could be protected if you
talked to a regulatory agency.

1961
01:38:04,542 --> 01:38:09,125
And I'm like, what regulatory
agency? How do you that?

1962
01:38:09,208 --> 01:38:12,125
I've been nervous to send
or even write this letter.

1963
01:38:12,208 --> 01:38:16,166
Theranos takes confidentiality and
secrecy to an extreme level...

1964
01:38:16,250 --> 01:38:18,101
Mistakes always happen in a clinical lab,

1965
01:38:18,125 --> 01:38:20,875
but what went on in Theranos
was complete negligence

1966
01:38:20,959 --> 01:38:23,250
and honestly felt
criminal in many ways.

1967
01:38:23,333 --> 01:38:25,834
Upper level management
constantly made excuses

1968
01:38:25,917 --> 01:38:28,500
for their misgivings...
but they continue to...

1969
01:38:32,750 --> 01:38:36,583
I don't feel like it's sort
of a cold-blooded scam, right?

1970
01:38:37,417 --> 01:38:39,041
It just seems it started off

1971
01:38:39,125 --> 01:38:41,000
as something small,
like one lie,

1972
01:38:41,083 --> 01:38:44,333
and snowballed into this really

1973
01:38:44,417 --> 01:38:46,750
crazy situation.

1974
01:38:46,834 --> 01:38:48,333
♪ Can't touch this ♪

1975
01:38:50,417 --> 01:38:52,083
♪ Can't touch this ♪

1976
01:38:54,000 --> 01:38:55,417
♪ Can't touch this ♪

1977
01:38:55,500 --> 01:38:57,542
♪ Oh, oh, oh, oh, oh, oh, oh ♪

1978
01:38:57,625 --> 01:38:58,792
♪ Can't touch this ♪

1979
01:38:58,875 --> 01:39:00,083
♪ Oh, oh, oh, oh, oh, oh, oh ♪

1980
01:39:00,166 --> 01:39:02,166
♪ My, my, my music ♪

1981
01:39:02,250 --> 01:39:05,125
♪ Keeps me so hard,
makes me say oh my Lord ♪

1982
01:39:05,208 --> 01:39:06,875
♪ Thank you for blessing me ♪

1983
01:39:06,959 --> 01:39:08,875
♪ With a mind to rhyme
and two hype feet ♪

1984
01:39:08,959 --> 01:39:10,667
♪ That's good when
you know you're down ♪

1985
01:39:10,750 --> 01:39:12,625
♪ A super dope homeboy
from the Oaktown ♪

1986
01:39:12,709 --> 01:39:15,041
So, what do you guys think
about the FDA clearance?

1987
01:39:19,125 --> 01:39:20,875
♪ Can't touch this ♪

1988
01:39:20,959 --> 01:39:24,041
It was around the 4th of July of 2015.

1989
01:39:24,125 --> 01:39:26,375
It was euphoria at the company.

1990
01:39:26,458 --> 01:39:29,333
It was, you know...

1991
01:39:29,417 --> 01:39:30,625
♪ Bust the funky lyrics ♪

1992
01:39:30,709 --> 01:39:32,208
♪ Fresh new kicks and pants ♪

1993
01:39:32,291 --> 01:39:34,226
♪ You got it like that,
now you know you wanna dance ♪

1994
01:39:34,250 --> 01:39:35,959
This is a very
meaningful milestone

1995
01:39:36,041 --> 01:39:37,417
for both Elizabeth and Sunny.

1996
01:39:37,500 --> 01:39:39,875
It felt like a great
victory at the time.

1997
01:39:42,792 --> 01:39:46,083
It was a big
celebration for a little victory.

1998
01:39:46,166 --> 01:39:47,917
The FDA had finally approved

1999
01:39:48,000 --> 01:39:50,333
one rarely used test for herpes

2000
01:39:50,417 --> 01:39:53,000
to be run on
an Edison prototype.

2001
01:39:53,083 --> 01:39:54,959
That was too little
too late for Walgreens,

2002
01:39:55,041 --> 01:39:57,917
which put the brakes on
opening new Wellness Centers.

2003
01:39:58,000 --> 01:39:59,583
And while Theranos
had boasted revenues

2004
01:39:59,667 --> 01:40:02,709
of more than a billion
dollars for 2015,

2005
01:40:02,792 --> 01:40:06,208
the actual cash in the door was
only a few hundred thousand.

2006
01:40:07,709 --> 01:40:10,500
But Elizabeth and Sunny
were not backing down.

2007
01:40:10,583 --> 01:40:13,208
We are going to send a
message to Quest Diagnostics.

2008
01:40:13,291 --> 01:40:16,083
Remember, these are
the guys who are after us,

2009
01:40:16,166 --> 01:40:18,326
and they're attacking the work
that you guys are doing.

2010
01:40:18,375 --> 01:40:20,291
- Are you ready?
- Yeah!

2011
01:40:20,375 --> 01:40:22,291
Okay. One,

2012
01:40:22,375 --> 01:40:23,875
two, three.

2013
01:40:23,959 --> 01:40:25,333
Fuck you!

2014
01:40:50,083 --> 01:40:52,959
I saw the alert when I got up in the morning,

2015
01:40:53,041 --> 01:40:55,458
and I read it by my bed.

2016
01:40:55,542 --> 01:40:58,667
It had this really
understated headline.

2017
01:41:00,583 --> 01:41:03,959
But the contents of the article
were just devastating.

2018
01:41:13,792 --> 01:41:17,583
When I got to work,
I read it a couple more times.

2019
01:41:18,041 --> 01:41:21,667
Suddenly, all of the trade
secret stuff made sense.

2020
01:41:21,750 --> 01:41:24,333
Oh, I see. It's
not a trade secret.

2021
01:41:24,417 --> 01:41:26,000
Um...

2022
01:41:26,083 --> 01:41:28,792
It's a different kind
of secret, and, um...

2023
01:41:36,542 --> 01:41:40,375
I did not know that Siemens were being used

2024
01:41:40,458 --> 01:41:43,208
until after the article hit.

2025
01:41:43,291 --> 01:41:45,375
And then
that kind of explains

2026
01:41:45,458 --> 01:41:47,458
why we were doing
venipuncture,

2027
01:41:47,542 --> 01:41:50,625
as opposed to the
fingerstick collection.

2028
01:41:50,709 --> 01:41:55,083
I then started...
revamping my résumé.

2029
01:41:57,083 --> 01:41:58,417
I'm sorry, but I did!

2030
01:42:04,250 --> 01:42:06,208
I was lucky when the Wall Street Journal

2031
01:42:06,291 --> 01:42:08,542
actually ended up
publishing their article

2032
01:42:08,625 --> 01:42:09,875
because once that happened,

2033
01:42:09,959 --> 01:42:12,208
Theranos' efforts
were focused elsewhere.

2034
01:42:12,333 --> 01:42:14,291
We never went to court.
We never...

2035
01:42:14,375 --> 01:42:16,709
had any sort of settlement.
It just kind of died.

2036
01:42:19,041 --> 01:42:21,667
The fate and future
of the company was at stake.

2037
01:42:22,875 --> 01:42:26,083
So, we gathered
in our cafeteria.

2038
01:42:26,166 --> 01:42:30,250
Elizabeth and Sunny spoke
to what was happening,

2039
01:42:30,333 --> 01:42:32,291
and that these
allegations are not true.

2040
01:42:33,375 --> 01:42:35,667
And then, Elizabeth
made a comment about

2041
01:42:35,750 --> 01:42:39,041
taking on the Wall Street
Journal as a fight.

2042
01:42:45,208 --> 01:42:46,333
I knew immediately

2043
01:42:46,417 --> 01:42:48,500
when I woke up
that day that the article

2044
01:42:48,583 --> 01:42:51,250
was having impact
because e-mails from readers

2045
01:42:51,375 --> 01:42:53,709
and from colleagues were
flowing in to my inbox.

2046
01:42:53,792 --> 01:42:55,917
And I was also getting asked

2047
01:42:56,000 --> 01:42:57,959
to do various media interviews.

2048
01:42:58,041 --> 01:42:59,601
New Wall Street Journal story

2049
01:42:59,667 --> 01:43:01,750
by John Carreyrou.
Thanks for joining us, John...

2050
01:43:01,834 --> 01:43:04,166
The article was a wake-up call

2051
01:43:04,250 --> 01:43:06,333
for Silicon Valley.

2052
01:43:06,417 --> 01:43:08,875
This sort of gold rush
had been going on.

2053
01:43:08,959 --> 01:43:10,959
These unicorns
had been created.

2054
01:43:11,041 --> 01:43:14,625
Companies that have valuations
of more than a billion dollars.

2055
01:43:14,709 --> 01:43:16,625
They were staying
private much longer

2056
01:43:16,709 --> 01:43:20,250
than start-ups had in the
dot-com boom of the late '90s.

2057
01:43:20,375 --> 01:43:23,166
And as a result, they were
able to be less transparent

2058
01:43:23,250 --> 01:43:25,083
than companies
that have to report

2059
01:43:25,208 --> 01:43:26,917
to investors every quarter.

2060
01:43:27,000 --> 01:43:29,750
And I think suddenly there was
a realization in Silicon Valley

2061
01:43:29,834 --> 01:43:33,750
that this has allowed
fraud to thrive.

2062
01:43:38,625 --> 01:43:40,625
Obviously,
when I called Theranos

2063
01:43:40,750 --> 01:43:42,470
and tried to speak
to Elizabeth and was told

2064
01:43:42,542 --> 01:43:45,792
that she was going to be
unavailable all day.

2065
01:43:45,917 --> 01:43:50,375
She was being inducted into the Harvard
Medical School Board of Fellows.

2066
01:43:52,458 --> 01:43:56,166
And, um...
I was just stunned.

2067
01:43:56,250 --> 01:43:57,959
I was thinking in my mind,

2068
01:43:58,041 --> 01:44:00,083
the Wall Street Journal
has just said...

2069
01:44:01,208 --> 01:44:03,792
that you're a fraud, and that
you're company is a fraud,

2070
01:44:03,917 --> 01:44:07,583
and the company I put on the
cover of a magazine is a fraud,

2071
01:44:08,500 --> 01:44:10,500
and you're going to spend...

2072
01:44:13,750 --> 01:44:15,417
the whole day...

2073
01:44:18,333 --> 01:44:21,250
hiding out at this, uh...

2074
01:44:24,041 --> 01:44:25,625
at this, uh...

2075
01:44:27,917 --> 01:44:30,542
honorary horseshit, you know?

2076
01:44:30,625 --> 01:44:32,500
You need to get out here,

2077
01:44:32,583 --> 01:44:34,667
and go through this article,

2078
01:44:34,750 --> 01:44:37,333
paragraph by paragraph,

2079
01:44:37,417 --> 01:44:41,208
explaining what the fuck's
going on at your company.

2080
01:44:44,417 --> 01:44:45,685
Your article was pretty brutal,

2081
01:44:45,709 --> 01:44:47,226
but here on Mad Money,
we know something.

2082
01:44:47,250 --> 01:44:49,959
We know that there are two
sides to every single story.

2083
01:44:50,041 --> 01:44:52,458
Coming to us this
afternoon from Boston,

2084
01:44:52,542 --> 01:44:54,434
where she's attending a meeting
of the Board of Fellows

2085
01:44:54,458 --> 01:44:57,291
at Harvard Medical School,
to give her a chance to answer

2086
01:44:57,375 --> 01:44:59,083
the charges raised
in the article.

2087
01:44:59,166 --> 01:45:01,750
Ms. Holmes, welcome
back to Mad Money.

2088
01:45:01,834 --> 01:45:03,250
It's great to be
here, thank you.

2089
01:45:03,333 --> 01:45:06,083
This is what happens when
you work to change things,

2090
01:45:06,166 --> 01:45:09,375
and first they think you're
crazy, then they fight you.

2091
01:45:09,458 --> 01:45:11,709
And then, all of a sudden,
you change the world.

2092
01:45:11,792 --> 01:45:14,083
And, um, I have to say,

2093
01:45:14,166 --> 01:45:16,542
I personally was
shocked to see that

2094
01:45:16,625 --> 01:45:18,875
the Journal would publish
something like this.

2095
01:45:18,959 --> 01:45:21,458
Every single one
of the sources that

2096
01:45:21,542 --> 01:45:24,458
we spoke with who the Journal
had contacted told us

2097
01:45:24,542 --> 01:45:27,333
that the statements that were
being attributed to them

2098
01:45:27,417 --> 01:45:29,333
were false or
misleading...

2099
01:45:29,417 --> 01:45:34,375
She decided to come out
and address my story and rebut it.

2100
01:45:34,458 --> 01:45:37,709
Theranos issued a press release
calling my reporting false,

2101
01:45:37,792 --> 01:45:40,500
and they were threatening
us with litigation.

2102
01:45:40,583 --> 01:45:43,125
The journalism here has been so bad,

2103
01:45:43,208 --> 01:45:44,750
they deserve to be sued,

2104
01:45:44,834 --> 01:45:47,917
but lawsuits
rarely resolve issues.

2105
01:45:48,000 --> 01:45:50,542
What's going to resolve
this issue is the science,

2106
01:45:50,625 --> 01:45:52,125
the marketplace.

2107
01:45:52,208 --> 01:45:55,500
Um, the company has been
successful in Arizona.

2108
01:45:56,375 --> 01:45:58,125
Doctors are happy,
patients are happy...

2109
01:45:58,208 --> 01:46:00,917
Doctors and patients were not happy.

2110
01:46:01,000 --> 01:46:03,500
The FDA was so worried
about patient safety

2111
01:46:03,583 --> 01:46:05,750
that it banned the use
of the nanotainer,

2112
01:46:05,834 --> 01:46:09,417
putting an end to all
fingerstick tests at Walgreens.

2113
01:46:09,500 --> 01:46:12,875
CMS conducted a surprise
inspection of the Theranos lab,

2114
01:46:12,959 --> 01:46:15,959
and found the blood
testing so inaccurate,

2115
01:46:16,041 --> 01:46:18,542
that it posed a threat
to patient safety,

2116
01:46:18,625 --> 01:46:20,583
likely to cause serious injury,

2117
01:46:20,667 --> 01:46:22,500
harm, or death.

2118
01:46:22,583 --> 01:46:26,291
CMS revoked the lab's
license to operate.

2119
01:46:26,375 --> 01:46:28,625
The letter that
prompted CMS to act

2120
01:46:28,709 --> 01:46:31,000
came from Erika Cheung.

2121
01:46:32,041 --> 01:46:33,393
You know, in the end for me,

2122
01:46:33,417 --> 01:46:35,583
it was a bit
of a mixed feeling.

2123
01:46:35,667 --> 01:46:38,667
I was really excited because
the truth finally got out.

2124
01:46:38,750 --> 01:46:42,208
But then also, a bit of
sadness in the fact that, um...

2125
01:46:42,291 --> 01:46:44,625
you know, we all really wanted
that project to succeed.

2126
01:46:44,709 --> 01:46:48,083
Have you been able to win your argument

2127
01:46:48,166 --> 01:46:50,417
with your grandfather
in terms of persuading him

2128
01:46:50,500 --> 01:46:52,291
of the problems
at Theranos?

2129
01:46:52,375 --> 01:46:56,041
He said that he had no idea
how much deception there was,

2130
01:46:56,125 --> 01:46:58,667
and that he was proud of me.

2131
01:46:58,750 --> 01:47:00,166
Yeah.

2132
01:47:00,250 --> 01:47:04,917
Yeah, I'm glad he finally
really gets it.

2133
01:47:08,500 --> 01:47:11,250
There was a Journal technology conference

2134
01:47:11,333 --> 01:47:15,291
taking place in Laguna Beach
in late October 2015,

2135
01:47:15,375 --> 01:47:18,333
and it so happened
that more than a year prior

2136
01:47:18,417 --> 01:47:21,500
it had lined up Elizabeth
Holmes as one of the speakers.

2137
01:47:21,583 --> 01:47:24,834
Could you get specific
on the key points today...

2138
01:47:24,959 --> 01:47:27,250
And not only did she come,
she came swinging.

2139
01:47:27,333 --> 01:47:30,208
The tests that are offered
are of the highest quality.

2140
01:47:30,250 --> 01:47:33,709
We know what we're doing,
and we're very proud of it.

2141
01:47:33,792 --> 01:47:37,000
Were there situations
in which you, uh,

2142
01:47:37,125 --> 01:47:39,291
had to dilute
blood samples?

2143
01:47:39,375 --> 01:47:40,959
What the Journal described

2144
01:47:41,000 --> 01:47:42,667
that we take
a sample, dilute it,

2145
01:47:42,792 --> 01:47:44,667
and put it on
a commercial analyzer

2146
01:47:44,792 --> 01:47:47,291
is inaccurate,
and that's not what we do.

2147
01:47:47,375 --> 01:47:49,101
I watched it on the Journal website,

2148
01:47:49,125 --> 01:47:51,959
and I couldn't believe
what she just said.

2149
01:47:52,000 --> 01:47:55,083
There was no question
that that was a huge lie

2150
01:47:55,125 --> 01:47:56,875
because they were
absolutely doing it.

2151
01:47:56,959 --> 01:47:59,250
We don't actually
use the technology

2152
01:47:59,333 --> 01:48:01,875
that's being referred
to as Edison for anything,

2153
01:48:01,959 --> 01:48:04,250
and haven't for
a few years now.

2154
01:48:04,291 --> 01:48:08,583
When we do fingerstick,
every time, we use technology

2155
01:48:08,667 --> 01:48:10,959
that is not
commercially available.

2156
01:48:11,083 --> 01:48:12,583
We have never used

2157
01:48:12,667 --> 01:48:15,083
commercially available
lab equipment

2158
01:48:15,125 --> 01:48:16,709
for fingerstick-based tests.

2159
01:48:16,792 --> 01:48:18,542
Every fingerstick test...

2160
01:48:18,625 --> 01:48:21,458
I had underestimated her willingness

2161
01:48:21,542 --> 01:48:25,709
to bald-face lie
in public, on our turf.

2162
01:48:25,792 --> 01:48:28,291
I guess what I really want
to know is, do you feel now,

2163
01:48:28,375 --> 01:48:32,458
in hindsight, that maybe you went
market a little too quickly?

2164
01:48:32,542 --> 01:48:34,302
Did you feel pressured
to do that in any way?

2165
01:48:34,375 --> 01:48:36,250
We're the exact same company.

2166
01:48:36,375 --> 01:48:37,959
Nothing has changed.

2167
01:48:38,041 --> 01:48:40,834
We're working every single day
to try to get these tests

2168
01:48:40,917 --> 01:48:43,125
and systems to meet
the highest quality standards.

2169
01:48:55,542 --> 01:48:58,250
Couple of months after
John Carreyrou's article,

2170
01:48:58,291 --> 01:49:01,750
I wrote a new story.

2171
01:49:01,834 --> 01:49:06,458
It was both a correction
and a mea culpa.

2172
01:49:06,542 --> 01:49:10,125
And I said that Elizabeth
had intentionally misled me.

2173
01:49:12,417 --> 01:49:14,500
After I published the piece,

2174
01:49:14,583 --> 01:49:16,125
Elizabeth called me,

2175
01:49:16,208 --> 01:49:19,750
and there was
a long conversation.

2176
01:49:19,834 --> 01:49:22,291
She was not apologetic.
She said,

2177
01:49:22,417 --> 01:49:25,250
"I never would intentionally
try to mislead you.

2178
01:49:25,291 --> 01:49:27,166
Why would we do that?"

2179
01:49:27,250 --> 01:49:30,834
She was trying to persuade
me to take out that sentence.

2180
01:49:30,917 --> 01:49:32,250
She said something like,

2181
01:49:32,291 --> 01:49:34,500
"If you're not going to take
that language out,

2182
01:49:34,583 --> 01:49:38,166
we're going to have to do
something about that language,"

2183
01:49:38,250 --> 01:49:39,667
which was a little menacing,

2184
01:49:39,750 --> 01:49:43,959
but all that they then did
was they wrote a letter.

2185
01:49:44,041 --> 01:49:45,959
Toward the end,
there was a weird paragraph,

2186
01:49:46,041 --> 01:49:48,417
something to the effect that
Elizabeth didn't even realize

2187
01:49:48,500 --> 01:49:51,709
that Fortune was doing
a feature profile,

2188
01:49:51,792 --> 01:49:53,542
let alone a cover.

2189
01:49:53,625 --> 01:49:55,750
And it was so, such a...

2190
01:49:56,709 --> 01:49:59,291
bizarre thing 'cause...

2191
01:50:00,458 --> 01:50:03,083
I was out there four days and...

2192
01:50:03,583 --> 01:50:06,041
I had called all these
people at her behest.

2193
01:50:06,125 --> 01:50:07,583
You know, seven directors,

2194
01:50:07,667 --> 01:50:10,542
the head of UCSF Medical Center,

2195
01:50:10,625 --> 01:50:12,625
the head of Blue Cross
Blue Shield.

2196
01:50:12,709 --> 01:50:16,083
I spent an hour and a half with
her parents. I met her brother.

2197
01:50:16,166 --> 01:50:19,417
I asked her about the letter
she wrote when she was nine.

2198
01:50:19,500 --> 01:50:22,208
I asked her about the book
her father gave her

2199
01:50:22,291 --> 01:50:24,834
when she went away
to school, which was

2200
01:50:24,917 --> 01:50:27,250
Meditations
by Marcus Aurelius.

2201
01:50:27,333 --> 01:50:29,417
And then there was
the photo shoot!

2202
01:50:29,500 --> 01:50:31,375
It was a big-name photographer,

2203
01:50:31,458 --> 01:50:34,500
and his assistants,
and the lighting equipment,

2204
01:50:34,583 --> 01:50:37,041
and taking
a couple hundred photos

2205
01:50:37,125 --> 01:50:40,250
in different locations
and different poses.

2206
01:50:40,333 --> 01:50:42,709
That was a clue, you know?

2207
01:50:46,333 --> 01:50:49,333
This was real lunacy.

2208
01:50:50,834 --> 01:50:53,291
I realized that there was
something wrong with her mind,

2209
01:50:53,375 --> 01:50:58,834
that, um, you know, I don't know
if she's lying or if she's...

2210
01:50:59,834 --> 01:51:03,583
uh, there's an unconscious, um,

2211
01:51:03,667 --> 01:51:05,583
reconstruct... self-protective,

2212
01:51:05,667 --> 01:51:08,041
reconstruction of reality
that's going on.

2213
01:51:08,125 --> 01:51:10,083
But what is coming
out of her mouth

2214
01:51:10,166 --> 01:51:12,750
is not mapping onto reality

2215
01:51:12,834 --> 01:51:14,792
as you or I know it, you know?

2216
01:51:20,917 --> 01:51:22,750
I wish I could say to her,

2217
01:51:22,834 --> 01:51:24,559
"Elizabeth, I'm going to give
you a truth serum,

2218
01:51:24,583 --> 01:51:26,166
"and you're going to tell me

2219
01:51:26,250 --> 01:51:29,709
what was going through
your mind at that time."

2220
01:51:30,208 --> 01:51:32,875
And the question
becomes, do you...

2221
01:51:32,959 --> 01:51:35,792
do we believe
that she would say,

2222
01:51:35,875 --> 01:51:38,000
"I knowingly lied?"

2223
01:51:39,166 --> 01:51:41,458
I have a hard time

2224
01:51:41,542 --> 01:51:43,333
imagining her saying that.

2225
01:51:46,250 --> 01:51:49,625
She was a zealot, and a zealot
is such a believer,

2226
01:51:49,709 --> 01:51:51,959
a true believer,
in what they're doing

2227
01:51:52,041 --> 01:51:55,083
that they're blind to the
reality of what's happening.

2228
01:51:56,333 --> 01:51:58,583
Not for a moment do I believe

2229
01:51:58,667 --> 01:52:02,291
that she lies in bed
at night and thinks,

2230
01:52:02,375 --> 01:52:06,083
"I was a swindler.
I was a crook. I lied."

2231
01:52:10,834 --> 01:52:15,000
So one day, I get an e-mail from
somebody who works with Elizabeth Holmes.

2232
01:52:15,083 --> 01:52:19,792
He asked me if I would come and meet
with their team and with Elizabeth.

2233
01:52:19,875 --> 01:52:21,625
I said sure.

2234
01:52:21,709 --> 01:52:25,375
Part of my research is actually
about human motivation,

2235
01:52:25,458 --> 01:52:28,834
and she was very concerned about
the demotivation in the company.

2236
01:52:28,917 --> 01:52:32,458
Right? Because
the continuous stories

2237
01:52:32,542 --> 01:52:36,417
around them were demotivating.

2238
01:52:36,500 --> 01:52:42,417
My impression was that she truly
believed in the mission of the company,

2239
01:52:42,500 --> 01:52:45,208
and that she also
believes that they are

2240
01:52:45,291 --> 01:52:48,583
on the way to achieve something,

2241
01:52:48,667 --> 01:52:51,291
and they just need the runway.

2242
01:52:54,625 --> 01:52:57,000
There's a lot of lying
in Silicon Valley.

2243
01:52:59,542 --> 01:53:02,583
And I remember when my first
book on dishonesty came out,

2244
01:53:02,667 --> 01:53:05,208
and I did a book tour,
and I gave a few talks

2245
01:53:05,291 --> 01:53:07,750
in Silicon Valley,
some entrepreneur said,

2246
01:53:07,834 --> 01:53:11,083
"Oh, we are in technology.
Technology doesn't lie."

2247
01:53:11,166 --> 01:53:13,059
Right?
So, and they basically said,

2248
01:53:13,083 --> 01:53:15,208
"We are honest,
there's no opportunities."

2249
01:53:15,291 --> 01:53:17,625
And I didn't say anything,
but in two minutes,

2250
01:53:17,709 --> 01:53:20,166
all kind of people from
the start-ups around him

2251
01:53:20,250 --> 01:53:23,792
started talking about
how they lie to investors.

2252
01:53:24,500 --> 01:53:27,000
And they have all these graphs
of growth, right?

2253
01:53:27,083 --> 01:53:28,917
I mean, they're predicting
the future,

2254
01:53:29,000 --> 01:53:31,250
and they putting
exact numbers on their...

2255
01:53:31,333 --> 01:53:35,041
And my thought was
that there is this idea

2256
01:53:35,125 --> 01:53:38,375
in Silicon Valley,
where you, um...

2257
01:53:38,458 --> 01:53:41,000
in a very brave way,

2258
01:53:41,834 --> 01:53:45,792
put a post somewhere really far

2259
01:53:45,875 --> 01:53:49,083
that you truly have
no idea if you can get there.

2260
01:53:49,166 --> 01:53:52,917
And my sense from the
discussion with Elizabeth was

2261
01:53:53,000 --> 01:53:55,917
that she felt
that she was basically

2262
01:53:56,000 --> 01:53:58,625
doing the same thing
that everybody else is doing.

2263
01:54:00,959 --> 01:54:02,685
We have lots of people
who are overconfident,

2264
01:54:02,709 --> 01:54:05,125
and from time to time,
some of them work out,

2265
01:54:05,208 --> 01:54:08,166
and we get penicillin,
or the incandescent light bulb,

2266
01:54:08,250 --> 01:54:11,333
or we get...

2267
01:54:13,250 --> 01:54:15,291
And if you are
surrounded by companies

2268
01:54:15,375 --> 01:54:17,583
who try very hard
and dedicate their lives

2269
01:54:17,667 --> 01:54:20,875
to achieve the impossible,

2270
01:54:20,959 --> 01:54:24,208
and then sometimes they
are successful in doing it,

2271
01:54:24,291 --> 01:54:26,208
why can't you?

2272
01:54:29,041 --> 01:54:30,458
At the highest level,

2273
01:54:30,542 --> 01:54:33,208
we didn't have the right
leadership in the laboratory,

2274
01:54:33,291 --> 01:54:35,083
and I didn't realize

2275
01:54:35,166 --> 01:54:37,417
until the inspection

2276
01:54:37,500 --> 01:54:39,542
that these types
of issues were in place.

2277
01:54:39,625 --> 01:54:41,792
So, until
the government told you

2278
01:54:41,875 --> 01:54:43,393
that you were really
out of compliance,

2279
01:54:43,417 --> 01:54:44,583
- you didn't know?
- Yeah.

2280
01:54:44,667 --> 01:54:46,417
What was your reaction
when you found out

2281
01:54:46,500 --> 01:54:47,834
that you had all
these violations

2282
01:54:47,917 --> 01:54:49,500
- in your lab?
- It was devastating.

2283
01:54:49,583 --> 01:54:51,542
Don't blame anyone else.

2284
01:54:51,625 --> 01:54:54,065
You have controlling shares in
that company, Elizabeth Holmes.

2285
01:54:54,125 --> 01:54:55,458
The buck stops there.

2286
01:54:55,542 --> 01:55:00,458
People make mistakes,
but you must always admit it.

2287
01:55:00,542 --> 01:55:01,875
My husband's favorite phrase:

2288
01:55:01,959 --> 01:55:04,750
"Excuses are like assholes.
Everyone has one."

2289
01:55:04,834 --> 01:55:07,250
Sorry. You don't have to put that in there.

2290
01:55:07,333 --> 01:55:09,333
One of the headlines was,

2291
01:55:09,417 --> 01:55:11,667
"$9 Billion Company
Down to Zero."

2292
01:55:11,750 --> 01:55:13,583
And your investors
and your board members

2293
01:55:13,667 --> 01:55:15,208
are reading those
same things.

2294
01:55:15,291 --> 01:55:17,542
It's probably the most
important question, I think,

2295
01:55:17,625 --> 01:55:19,458
anybody who's watching
has about this.

2296
01:55:19,542 --> 01:55:21,875
- Does it work?
- Yes.

2297
01:55:21,959 --> 01:55:25,458
- You're confident in that?
- I am confident in that.

2298
01:55:25,542 --> 01:55:28,834
Without further ado,
I'd like to welcome Elizabeth Holmes,

2299
01:55:28,917 --> 01:55:31,917
founder and CEO of Theranos, to the stage.

2300
01:55:32,000 --> 01:55:33,875
Elizabeth did not give up.

2301
01:55:33,959 --> 01:55:36,000
She fought back
by taking center stage

2302
01:55:36,083 --> 01:55:39,709
at a clinical lab conference
in front of all her critics.

2303
01:55:39,792 --> 01:55:43,417
She defiantly unveiled the machine
she'd been hiding for so long.

2304
01:55:43,500 --> 01:55:46,375
- The miniLab is designed...
- She called it "miniLab,"

2305
01:55:46,458 --> 01:55:48,000
as if it were a new invention.

2306
01:55:48,083 --> 01:55:50,291
This is an inflection
point for our company...

2307
01:55:50,375 --> 01:55:53,375
But inside Theranos,
it had another name.

2308
01:55:53,458 --> 01:55:55,667
Edison 4.0.

2309
01:55:58,041 --> 01:56:00,500
By 2017, Theranos had spent

2310
01:56:00,583 --> 01:56:03,875
virtually all of
the $900 million it had raised.

2311
01:56:03,959 --> 01:56:06,875
Nearly 300 million
went to pay legal fees,

2312
01:56:06,959 --> 01:56:08,750
settle lawsuits from investors,

2313
01:56:08,834 --> 01:56:13,000
and to refund every patient in
Arizona for their blood tests.

2314
01:56:13,834 --> 01:56:15,667
Henry Kissinger, George Shultz,

2315
01:56:15,750 --> 01:56:18,542
and even David Boies
resigned from the board.

2316
01:56:19,458 --> 01:56:21,291
Elizabeth broke up with Sunny

2317
01:56:21,375 --> 01:56:23,125
and fired him from the company.

2318
01:56:23,208 --> 01:56:27,000
But she never lost her faith
in the power of invention.

2319
01:56:29,041 --> 01:56:32,542
It's finding...
what you love,

2320
01:56:32,625 --> 01:56:34,458
and finding what
you're born to do,

2321
01:56:34,542 --> 01:56:37,125
and when you find that,
whether it's...

2322
01:56:37,208 --> 01:56:39,166
you know, writing, or painting,

2323
01:56:39,250 --> 01:56:42,166
or science, or whatever
it is, when you...

2324
01:56:42,667 --> 01:56:44,375
when you really

2325
01:56:44,458 --> 01:56:47,166
give everything to that, then...

2326
01:56:48,208 --> 01:56:51,542
then you can realize
great things and...

2327
01:56:52,291 --> 01:56:54,291
we'll fail 10,000 times
if we have to,

2328
01:56:54,375 --> 01:56:58,583
but we'll figure it out
on the 10,0001st, you know.

2329
01:57:21,375 --> 01:57:24,041
Ms. Holmes,
please raise your right hand.

2330
01:57:24,125 --> 01:57:25,768
Do you swear to tell
the truth, the whole truth,

2331
01:57:25,792 --> 01:57:27,750
- and nothing but the truth?
- I do.

2332
01:57:39,041 --> 01:57:40,208
♪ You can't touch this ♪

2333
01:57:42,583 --> 01:57:43,750
♪ You can't touch this ♪

2334
01:57:46,083 --> 01:57:47,000
♪ You can't
touch this ♪

2335
01:57:47,083 --> 01:57:49,625
♪ Oh, oh, oh, oh, oh, oh, oh ♪

2336
01:57:49,709 --> 01:57:50,625
♪ You can't
touch this ♪

2337
01:57:50,709 --> 01:57:52,291
♪ Oh, oh, oh, oh, oh, oh, oh ♪

2338
01:57:52,375 --> 01:57:54,458
♪ My, my, my, my music ♪

2339
01:57:54,542 --> 01:57:55,667
♪ Keeps me so hard ♪

2340
01:57:55,750 --> 01:57:57,667
♪ Makes me say
Oh my Lord ♪

2341
01:57:57,750 --> 01:57:59,125
♪ Thank you
for blessing me ♪

2342
01:57:59,208 --> 01:58:01,000
♪ With a mind to rhyme
and two hype feet ♪

2343
01:58:01,083 --> 01:58:02,875
♪ It feels good when
you know you're down ♪

2344
01:58:02,959 --> 01:58:04,667
♪ A super dope homeboy
from the Oaktown ♪

2345
01:58:04,750 --> 01:58:06,333
♪ And I'm known as such ♪

2346
01:58:06,417 --> 01:58:08,750
♪ And this is the beat
you can't touch... ♪

2347
01:58:09,500 --> 01:58:11,166
♪ I told you,
homeboy ♪

2348
01:58:11,291 --> 01:58:12,959
♪ You can't touch this ♪

2349
01:58:13,041 --> 01:58:14,792
♪ Yeah, that's how
we living and you know ♪

2350
01:58:14,875 --> 01:58:16,792
♪ Can't
touch this ♪

2351
01:58:16,875 --> 01:58:18,375
♪ Look in my eyes, man ♪

2352
01:58:18,458 --> 01:58:19,208
♪ You can't touch this ♪

2353
01:58:19,291 --> 01:58:20,709
♪ Oh, oh, oh, oh, oh, oh, oh ♪

2354
01:58:20,792 --> 01:58:22,851
♪ Yo, let me bust the funky
lyrics, can't touch this ♪

2355
01:58:22,875 --> 01:58:24,542
♪ Fresh new kicks
and pants ♪

2356
01:58:24,625 --> 01:58:26,559
♪ You got it like that now
you know you wanna dance ♪

2357
01:58:26,583 --> 01:58:28,041
♪ So move out of your seat ♪

2358
01:58:28,125 --> 01:58:30,166
♪ And get a fly girl
and catch this beat ♪

2359
01:58:30,250 --> 01:58:31,166
♪ While it's rollin' ♪

2360
01:58:31,250 --> 01:58:32,458
♪ Hold on pump a little bit ♪

2361
01:58:32,542 --> 01:58:35,166
♪ And let me know it's going on like that,
like that ♪

2362
01:58:35,250 --> 01:58:36,917
♪ Cold on a mission
so fall on back ♪

2363
01:58:37,000 --> 01:58:38,875
♪ Let 'em know that
you're too much ♪

2364
01:58:38,959 --> 01:58:41,250
♪ And this is a beat
they can't touch ♪