How bad were Elizabeth Holmes’ 1AM emails?

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Today we had the first direct link between the problems at the laboratories of Theranos and Elizabeth Holmes. Former director of dosing systems Surekha Gangakhedkar was preparing blood tests for use in patients. The system was unreliable; describing herself as “stressed and unhappy and worried about the progress of the launch,” Gangakhedkar resigned.

Gangakhedkar met with Holmes to explain why she was quitting: she didn’t think the Edisons were good enough for patients to use. Holmes told him Theranos had “promised to deliver to customers and had no real choice,” except to proceed with the launch, Gangakhedkar said.

Holmes, who is on trial on wire fraud and conspiracy to commit wire fraud, had not been directly linked to the lab’s inadequacies in the testimony of the two previous witnesses. But Holmes was handy with the R&D lab, even emailing Gangakhedkar at 1 a.m. asking how the validation testing was going.

When Gangakhedkar quit, she printed and recorded emails because “I was worried about the launch,” she said. “I was afraid things would not turn out well, and I was also afraid of being blamed.” It was a direct violation of the nondisclosure agreement she had signed.

Gangakhedkar’s story corroborated that of whistleblower Erika Cheung. Earlier this week, Cheung said secrecy was the norm at Theranos and that she was even discouraged from listing the company on its LinkedIn page. “There was usually advice not to be shared” outside of his immediate group, Gangakhedkar said.

She found it frustrating. Secrecy meant she couldn’t communicate directly with the hardware team about any issues she was having with the machines. Instructions to keep things a secret came from Holmes or his co-defendant Sunny Balwani, who is on trial separately.

We saw a lot of emails actually from or with Holmes in the channel during Gangakhedkar’s direct testimony. Holmes gave the Gangakhedkar team specific instructions on work priorities and checked how the tests she wanted to validate were going. One of these emails arrived at 1:14 am on a Saturday.

It seems that late hours were the norm; another email from Balwani, with Holmes in copy, suggested the Gangakhedkar team were not working hard enough. “Please note that the software team was there until 3:07 a.m. – and is already here now at 10 a.m.,” he wrote. He then berated the Gangakhedkar team for leaving machines idle at night.

The pressure and secrecy made Gangakhedkar uncomfortable. The Edison 3.0 and 3.5 devices were unreliable, she said. She went on vacation in August 2013 and upon her return found – to her surprise – that these machines would be used to test patient samples.

Another surprise was that they were going to modify other people’s machines to use the smaller samples collected by Theranos. Holmes pressured Gangakhedkar to approve the tests so that they could go to the clinical lab.

At the beginning of September, she resigned. And another member of his team independently resigned the same day; after accepting the team member’s resignation, Gangakhedkar told him that she was also resigning.

Cheung, who concluded his testimony today, and Gangakhedkar both said there are significant quality control issues with Edison devices. Every time a device failed quality control, it had to be recalibrated, a process that could take over 12 hours if all went well. “We had people sleeping in the car because it was taking too long,” Cheung said. “Every few days you were running these samples over and over again.”

Later that day, Gangakhedkar said one of the issues with validating blood tests was that so few Edison machines were available. There was “a shortage,” she said, as they had to be recalibrated so often.

Among the emails Gangakhedkar printed was one from Theranos vice president Daniel Young. Gangakhedkar emailed Holmes to tell him that data was missing on the server regarding testing on a version of the Edison devices. In response, Young wrote that the wrong cartridges had been used in these races, and recommended that they be repeated.

It was not true, Gangakhedkar said. And five days after the email she got from Holmes at 1 a.m., she tendered her resignation. “It was difficult because over the past eight years working at Theranos, I felt I was going to make a difference,” Gangakhedkar said. It was a “huge disappointment” that all of her hard work was going to waste, she said.

But the message she got was “we’re launching no matter what,” she said. Gangakhedkar, who enjoys immunity from prosecution for his testimony, will take the stand next week.


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