CMS flogs Theranos for quality issues with blood clot test: WSJ

Theranos' Palo Alto, CA, headquarters--Courtesy of Theranos

In the latest chapter of Theranos' regulatory saga over proprietary testing, a federal inspection report shows that the company ran an important blood test on patients for 6 months even though quality-control checks of the product turned up questionable results.

The report, which hasn't been released yet, stems from an earlier inspection of Theranos' Newark, CA-based lab by the Centers for Medicare and Medicaid Services (CMS). Regulators found that between April 1 and Sept. 23, 2015, Theranos sent blood-test results to 81 patients even after finding issues with the tool, The Wall Street Journal reports.

Theranos' test is meant to measure how long it takes blood to clot to help doctors decide whether patients are a good fit for treatment with blood thinners such as warfarin. Inaccurate results from the test could lead doctors to prescribe too little or too much warfarin, medical experts say, which could put patients' health at risk.

Some deviation in test results is normal. But Theranos ignored quality-control results for its blood-clotting test that fell short of its own criteria. The results showed deviations from the lab's typical result by more than two standard deviations, a standard measurement of accuracy, according to the WSJ story.

Unsurprisingly, Theranos is standing by its testing practices. "We have conducted assessments to identify any patients affected or having the potential to be affected by the issues identified by CMS, and we have no reason to believe that these issues have affected patients' health," director of Theranos' Newark lab Kingshuk Das told the newspaper. Plus, "the CMS report is about people and processes in one Theranos lab in the past, and does not reflect the current state of that lab," he added.

Still, regulators turned up some unsettling information at an earlier inspection of the facility. In January, the CMS lambasted Theranos for "deficient practices" at its Newark lab. The agency said that during a November inspection of the facility, it found 5 major infractions that run afoul of federal law including one in hematology that poses "immediate jeopardy to patient health and safety."

The CMS gave Theranos 10 days to create a plan to fix the problem, but then granted the company a one-week extension. Theranos recently sent a plan to the agency for getting things back on track at its Newark lab and the agency's staff is "currently reviewing" the company's proposal, CMS spokesman Aaron Albright said last month.

Meanwhile, Theranos is dealing with the fallout. One of the company's main partners, Walgreens ($WBA), is plotting an emergency exit from the pair's relationship. The drugstore giant recently said that it is asking its lawyers to look at its contract with Theranos to see if there was a way to force the company to close the 40 blood-testing clinics that it set up at Walgreens' Arizona drugstores.

A failed deal with Walgreens would spell out disaster for Theranos because most of its blood-testing outlets are located at Walgreens drugstores. Neither side is commenting on a potential breakup, but Walgreens has "been unhappy with the relationship and it's really a question of working through the contractual and legal arrangements," a person familiar with the matter told The Financial Times last month. "They're not interested in the Theranos deal."

- read the WSJ story (sub. req.)

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