SAN JOSE, Calif. (KRON) — For a few years In Silicon Valley, Elizabeth Holmes was like a unicorn. She had a vision for revolutionizing healthcare, charmed powerful businessmen into rolling the dice on her biotech startup, and was admired as a young female CEO.
Federal prosecutors say her sparkling success and $9 billion blood-testing company, Theranos, were built on lies. Holmes is facing up to 20 years in prison if convicted of the fraud charges against her.
Two businessmen who helped make multi-million dollar deals with Holmes testified at her trial this week: former Safeway CEO Steve Burd and former Walgreens CFO Wade Miquelon.
Walgreens and Safeway were aiming for the same goal in 2010 – they wanted to put Theranos blood testing machines in all of their store pharmacies.
Prosecutors showed the jury power points Holmes presented to Burd and Miquelon, in which she claimed she had an invention that put an entire blood lab into a tiny box. She said the boxes could produce blood test results from a finger prick of blood in less than 30 minutes.
Prosecutors are using Holmes’ lofty claims to Walgreens and Safeway rose to the level of defrauding patients and investors.
Miquelon was very impressed by Holmes’ ideas.
“This would take the lab testing and put it into the pharmacy environment where you are very close to a lot of patients,” he testified.
Miquelon wrote an email in 2010 to his fellow Walgreens executives saying, “We will be the gateway into primary care and the gateway out. Then we really will be the most important player in US healthcare.”
Theranos needed access to patients, and Walgreens made that happen by opening “wellness centers” where patients could get Theranos blood tests.
Miquelon said he was like a “quarterback” for forging a partnership between Walgreens and Theranos.
“I cared about (Holmes) very much and wanted her to be successful,” Miquelon testified Wednesday.
Federal regulators found that Theranos’ technology didn’t work and patients’ lives were being put at risk. An investigation into Theranos’ secretive blood lab found that the blood testing machines produced inaccurate results.
Partnerships with Theranos were disasters for Safeway and Walgreens, which lost hundreds of millions of dollars in investments.
When Theranos came under fire in 2015 from articles printed in the Wall Street Journal and federal investigators, Miquelon still stood by Holmes. He testified that he didn’t want to believe that Theranos’ technology was severely flawed.
“I very much believed in Elizabeth and what she was up to,” Miquelon testified.
Patients who received bogus blood test results suffered from health scares, including one pregnant woman who was erroneously told she had a miscarriage.
The whole Theranos debacle was a huge black eye for Walgreens’ reputation. Even after leaving his job at Walgreens, Miquelon continued writing emails to Holmes expressing his support for her vision.
He wrote in October of 2015, “Dear Elizabeth you are in my thoughts. Hang in there. The haters are everywhere but your contribution to the world cannot be bottled up.”