Sorry, Theranos: CMS released a lightly redacted version of your proposed sanction letter

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

The Centers for Medicare and Medicaid Services (CMS) has tiptoed around releasing a copy of the letter it sent Theranos last month that proposed strict sanctions against the company. But now, CMS is letting most of the information in that note fly free to the wind.

Federal health regulators released a lightly redacted copy of the 45-page letter it sent Theranos on March 18. The agency also unveiled a new, lightly redacted copy of the inspection report from the CMS' once-over of the company's Newark, CA, lab last fall, The Wall Street Journal reports.

Regulators held back on releasing the letter before because the company said it contained trade secrets. But the CMS ultimately decided that its first redactions were too broad and that the note and report could be made public with fewer tweaks, according to the WSJ story.

The latest inspection report released to the public includes passages that show that Theranos' proprietary blood-testing devices often failed to meet the company's accuracy requirements for certain tests. In one case, the devices could not accurately detect prostate cancer.

The new, lightly redacted inspection report and letter also point to issues with a traditional blood-testing machine from Siemens that Theranos used to run tests. The company diluted small finger-stick samples of blood to fit the machine's volume requirements, former employees said. Theranos has denied the allegations.

Last November, the CMS stopped by Theranos' Newark facility and uncovered 5 major lab infractions. One of the violations posed "immediate jeopardy to patient health and safety," the agency said when it released its report.

Theranos submitted a game plan for fixing the issues, but the CMS was less than pleased with its response. In March, Theranos got a letter from the agency proposing 6 sanctions against the company, including revoking the license for its Newark, CA, lab and banning CEO Elizabeth Holmes from Theranos for at least two years.

Even though the company isn't facing any sanctions from the CMS now, things could change further down the road. For the time being, Theranos is doing everything it can to avoid the penalties.

"Due to the comprehensive nature of the corrective measures we've taken over the past several months, which has been affirmed by several experts, we are hopeful that CMS won't impose sanctions," Theranos spokeswoman Brooke Buchanan said earlier this month, as quoted by the WSJ. "But if they do, we will work with CMS to address all of their concerns."

- read the WSJ story (sub. req.)

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