Theranos and its early partner Walgreens have agreed to settle a breach-of-contract lawsuit in which the drugstore giant demanded $140 million in damages. Terms of the agreement were not disclosed.
The agreement will resolve “all claims among those parties” and will “result in the dismissal of Walgreens’ suit against Theranos, with no finding of or implication of liability,” Theranos said in a statement. Theranos did not say when it would make the payments to Walgreens.
Walgreens was an early validator of Theranos’ fingerstick blood tests, once operating 40 Theranos Wellness Centers in its Arizona stores and acting as its primary source of revenue. But after a Centers for Medicare & Medicaid Services (CMS) inspection turned up dangerous practices at Theranos’ lab in Newark, California, Walgreens asked its lawyers to find a way out of the alliance.
Last November, Walgreens filed suit in a Delaware district court, claiming that Theranos misrepresented its technology when the pair first tied up. It sought $140 million in damages, matching its investment in the embattled startup.
In June, the companies reached a tentative settlement in which Theranos would pay Walgreens less than $30 million, people familiar with the deal told The Wall Street Journal. However, the terms weren’t finalized and could change, the WSJ reported.
Theranos has spent 2017 settling lawsuit after lawsuit—in April, it settled with the Arizona Attorney General to fork over $4.65 million to Arizona residents who had paid for the company’s blood tests. A month later, Theranos settled two lawsuits with its San Francisco’s Partner Fund Management, which invested $96.1 million in the company in 2014.
Theranos is making changes to turn things around, including pivoting from its questionable fingerstick blood tests to a tabletop blood-processing system and revamping its senior management team, board of directors and scientific advisory board. But all of its settling is depleting its coffers—in June, the company told investors it had $54 million left to address claims, sources told the WSJ.