“The youngest self-made billionaire in the world,” stamped the American magazine Forbes on its cover. The upcoming “Steve Jobs” described another business publication.
In 2014, Elizabeth Holmes, then 30, was making headlines in the American press.
After leaving Stanford University in the United States, she founded a company valued at $9 billion, supposedly revolutionizing disease diagnosis.
With just a few drops of blood, the Theranos company’s Edison test promised to quickly detect diseases such as cancer and diabetes, without the need for needles.
Market bigwigs like Henry Kissinger and Rupert Murdoch were some of those who invested in the startup.
But in 2015 the first signs that something was wrong began to appear, and a year later, Holmes’s idea was discovered to be false. The technology it promoted didn’t work as expected.
In 2018, the company founded by Holmes declared bankruptcy.
Today, Holmes, at 37, faces up to 20 years in prison if convicted on all 12 counts of fraud she faces. She has never before told her side of the story.
His trial, which begins this month — USA Vs. Elizabeth Holmes, et al — will be closely monitored. The expectation is that she will plead not guilty.
And in a twist to the case, her lawyers are likely to argue that her ex-boyfriend and business partner, Ramesh “Sunny” Balwani, sexually abused her and emotionally controlled her at the time of the alleged crimes, undermining her mental state, US media reported. .
Balwani, 56, who faces the same charges of fraud, called the charges “outrageous.”
It will be up to the jury to decide how to judge a person who deceived from statesmen to big investors.
pressure from the start
Despite being the subject of a book, an HBO documentary, and a TV and movie series, it’s still unclear why Holmes took such a risk with a technology he knew didn’t work.
She grew up in a wealthy family in Washington DC, the US capital, and was an educated but introverted child, according to people close to her.
81-year-old businessman Richard Fuisz speculates that there must have been immense pressure on her to succeed.
His family lived next door to Holmes’ house for years, but they fell out when Theranos sued him over a patent dispute in 2011 (which was later settled in court).
Holmes’ parents were, for most of their careers, employees of the Capitol (US legislative center), but they always “had an interest in status” and “lived to network,” Fuisz told the BBC.
Her paternal great-grandfather founded Fleischmann’s Yeast, which revolutionized the bread industry in the United States, and the family was very aware of its origins, he added.
At the age of nine, young Elizabeth wrote a letter to her father declaring that “what she really wanted out of life was to discover something new, something humanity did not know it was possible to do.”
When he went to study Chemical Engineering at Stanford University, one of the most prestigious in the United States, in 2002, Holmes came up with the idea of creating a patch that could scan a patient for infections and thereby release antibiotics as needed.
At 18, he already showed an intransigence that, apparently, would continue to drive the company he founded the following year.
Phyllis Gardner, professor of Clinical Pharmacology at Stanford University, remembers talking to Holmes about her idea and telling him that it “wouldn’t work.”
“She just looked at me, but it was like she didn’t see me,” Gardner told the BBC. “Elizabeth seemed absolutely sure of her own glow. She wasn’t interested in my experience and it was a disconcerting situation.”
Months later, at age 19, Holmes abandoned Stanford and founded Theranos, with the seemingly revolutionary promise of testing blood with a simple finger prick.
Many powerful people were captivated by the idea and invested in the company without bothering to watch its balance sheet.
US Treasury Secretary George Schultz, decorated Marine General James Mattis (who later served in the Trump administration), and America’s richest family, the Waltons (owners of the Walmart supermarket chain) were some of the names that supported him.
This helped to cement Holmes’ reputation. But the way she behaved also played an important role in this context.
“I knew she had this brilliant idea and that she had managed to convince all these investors and scientists,” said Jeffrey Flier, a former dean of the Harvard University School of Medicine, who met Holmes for lunch in 2015.
“She was sure of herself, but when I asked her several questions about her technology, she didn’t seem to understand,” adds Flier, who never formally evaluated Holmes’ invention.
“It seemed a little strange to me, but I didn’t come away thinking it was a fraud.”
Flier ended up asking her to join the Faculty of Medicine’s Board of Scholars, something she regrets, although Holmes was thrown out of office when the scandal broke.
It all started to fall apart in 2015, when an insider raised concerns about Theranos’ flagship, the Edison test device.
In a series of reports, the American newspaper The Wall Street Journal showed that the results were unreliable and that the company had been using commercially available machines, produced by other manufacturers, to enable most of its tests.
Lawsuits piled up, partners severed ties, and in 2016, US regulators banned Holmes from operating a blood testing service for two years.
In 2018, Theranos declared bankruptcy.
Abusive or abused?
In March of that year, Holmes made a deal with the American justice – she was accused of raising US$ 700 million (R$ 3.6 billion, in current values) from investors fraudulently.
Three months later, however, she was arrested along with Balwani, on criminal charges of electronic fraud and conspiracy.
Prosecutors say Holmes intentionally misled patients about the tests and lied to investors about the company’s earnings.
Holmes was released on bail and in 2019 married William “Billy” Evans, 27, heir to the Evans Hotel Group hotel chain. They had a child in July this year.
“I don’t think the fact that Holmes is now a mother will influence the judgment, but the judge will likely take that into account if she is found guilty,” said Emily Baker, a former Los Angeles district attorney.
As the trial of the Theranos scandal draws near, analysts following the case say it’s remarkable how steadfast Holmes holds his version of the story — people close to it doubt it will change it during the hearing.
According to the filing, Holmes’ defense is willing to argue that she believed she ran a “legitimate business that created value for investors.”
His lawyers may also claim that Balwani’s alleged controlling behavior “erased his ability to make decisions”, including “deceiving his victims”.
They say the former Theranos chief of operations, who will be judged separately next year, monitored how Holmes dressed, what he ate and who he talked to for more than a decade.
The defense must also call a psychologist who specializes in sexual abuse as a witness.
It is unclear whether Holmes will speak during the trial.
“The hardest thing about any fraud case is showing that the person tried to cheat,” explains Baker. “So prosecutors will have to use her text messages and emails and argue that she knew the technology didn’t work, but said it did.”