Theranos might be on life support
It probably comes as no surprise Theranos, the blood testing technology company once worth billions, is struggling to survive. A new report from the Wall Street Journal says the company had just $200 million cash on hand left at the end of 2016 – a quarter of its $800 million in total funding.
According to the Journal’s investor sources, Theranos disclosed that number on a conference call in January in which the company also admitted it hadn’t made any material revenue in both 2015 and 2016. Theranos also disclosed it had not set aside funds for potential liabilities — something crucial for a growing army of lawsuits from customers, investors and its former partner Walgreens, which is suing the company for $140 million after a federal investigation deemed the company put patients in “immediate danger.”
The company has since pivoted direction from a once heralded one-drop blood test to a tabletop disease detection box called a “miniLab” after the company was forced to shutter its labs and founder Elizabeth Holmes was banned from operating in those labs last year.
Theranos’ recent hits have also caused a series of layoffs at the company, cutting 155 staff members in January and another 340 employees last October, reducing the number of employees from just over 700 to 220 — the majority of whom were kept to work on the “miniLab” product.
While the firm is hanging all hope on its new tabletop box, this new product has yet to meet with Federal Drug Administration approval and, according to TechCrunch’s own sources, is not anything new or revolutionary. Not only is it not likely to carry the company through to its former glory, it may not be enough to distinguish the company from a crowded market, one with several other potential competitors, many of which are already in regulatory compliance.
We’ve reached out to Theranos for comment and have yet to hear back but with no revenue, no money set aside to deal with legal expenses and a fraction of the funding it once had to work with, Theranos may not have long before it bleeds out entirely.