SAN JOSE, Calif. (KRON) — How bad was it inside Theranos’ blood lab?
“Normandy lab is a f***ing disaster zone,” Theranos COO Sunny Balwani privately texted Holmes on Nov. 28, 2014.
“Normandy” was the name for a secretive blood lab at Elizabeth Holmes’ Silicon Valley biotech company.
For Holmes’ criminal federal fraud trial, prosecutors are illuminating dozens of text messages exchanged between Holmes and Balwani to pinpoint what the duo knew, and when they knew it.
At the same time, Balwani was privately declaring the lab as a “disaster zone” to Holmes, Theranos continued to accept new patients and reassure doctors that they could trust test results. Holmes convinced sophisticated, high-powered investors to pump millions of dollars into her company.
Holmes, 37, became Silicon Valley’s golden girl when she claimed to be on the verge of inventing a miracle box named “Edison” and founded Theranos at age 19.
Holmes claimed her new micro technology put an entire blood lab into one little box. She said the boxes could produce a wide array of blood test results from a single drop of blood.
Her defense team claims she was a “naïve” young CEO who was unaware of major problems in the lab and underestimated business obstacles.
Normandy lab workers, some of whom were recent college graduates, were tasked with trying to make the Edisons deliver accurate blood test results for patients.
Balwani blamed the lab workers, not the technology.
“We built software to remove human error and human judgment. All day I saw these people use their judgments to work around our processes,” Balwani texted to Holmes.
Holmes texted back to Balwani, “This is where our problems are. Which means we can fix it. Thank god.”
Former lab tech Erika Cheung testified that she and her co-workers were working around the clock trying to get the Edisons to function accurately.
“We had people sleeping in their cars because it took so long,” she testified.
Blood lab results were supposed to take two hours to complete. But Theranos’ machines often produced false blood lab results, and recalibrating the machines took two or three days, Cheung said.
One patient, Brittany Gould, was told she had a miscarriage in 2014 because a Theranos blood test result that wrongly indicated her HCG levels were falling dramatically. Gould later gave birth to a healthy girl.
Prosecutors showed the jury a letter from Christian Holmes, Elizabeth Holmes’ brother and a Theranos employee, who wrote an apology to Gould’s doctor, saying “these errors are extremely rare.”
Gould was emotional at times on the witness stand. Pregnancy is a personal topic for Holmes, who gave birth just weeks before her trial began.
Throughout the trial, Holmes has sat in the courtroom with a stone face and perfect posture. Sometimes she whispers to her attorneys. She often holds her mother’s hand as she walks to and from the courthouse in San Jose, and stays silent as reporters toss out questions.
Ten other patients who also endured false alarm health scares are slated to testify during Holmes’ 3-month trial.
A senior scientist at Theranos, Surekha Gangakhedkar, testified that she quit in 2013 because she was “uncomfortable” with Edison boxes being used for patients.
Cheung also quit and became a whistleblower.
Theranos replaced Gangakhedkar as lab director with Adam Rosendorff in mid-2013. He testified that he saw red flags, and started forwarding company emails to his private email. Sending company emails to a private email violated company policy, but he did it anyway in case the company ever came under fire from investigators.
“I wanted to protect myself … in the event of an investigation. I wanted to get the word out of what was going on at Theranos. I felt strongly that the public benefit of this information getting out was of importance to me,” Rosendorff testified.
“I was very enthusiastic working at Theranos in the beginning. Over time, I came to realize the company really valued PR and fundraising above patient care,” he testified.
Rosendorff said patients were experiencing “a lot of anxiety” from blood test results showing they may have a life-threatening condition.
Rosendorff returned to the witness stand Tuesday for cross-examinations.
America’s former youngest self-made billionaire is facing a maximum of 20 years in prison if convicted.