Theranos is at it again: The embattled blood-testing startup is slashing 155 jobs, leaving just 220 to work on its tabletop diagnostic testing device. The layoffs come three months after the company dumped its questionable blood testing tech in favor of its new miniLab device.
The company has “identified a core team” of 220 employees who will advance the miniLab with eyes on commercialization, according to a statement. The 155 eliminated positions account for about 41% of Theranos’ workforce.
Theranos first unveiled the miniLab at the annual meeting of the American Association for Clinical Chemistry in August. The device is designed to process small blood samples in a “decentralized setting.” In October, Theranos officially abandoned its fingerprick blood testing tech, closing its clinical labs and Theranos Wellness Centers in California, Arizona and Pennsylvania. At the time, the company cut 340 employees, or 40% of its 790-person workforce.
When Theranos debuted the miniLab, experts had been expecting an explanation of the technology behind the company’s fingerprick blood tests, which were first called into question by The Wall Street Journal in 2015. Over the ensuing year, Theranos’ chief operating officer jumped ship, the Centers for Medicare and Medicaid services has investigated the company’s Newark, CA, lab and handed down sanctions and its partner and main technology validator, Walgreens, has terminated their relationship and sued for breach of contract.
The CMS sanctions include revoking the Newark lab's CLIA certificate and banning Holmes from owning, operating or directing a lab for two years. While Theranos is appealing the sanctions, a sample-processing device that can be used outside a lab would be a way for the company to regain its feet after the firestorm surrounding the viability and accuracy of the fingerprick tests on which it was founded.