Lab Soft News

Kaiser Permanente to Launch New Independent Medical School

It's no surprise that large heath systems are opening their own medical schools but their goals may differ. For example, the Cleveland Clinic Lerner College of Medicine is designed to train physician investigators (see: Cleveland Clinic Lerner College of Medicine of Case Western Reserve University). Kaiser Permanente has just announced plans to open a medical school but it's clear that the goals of Kaiser are much different than those of Cleveland Clinic (see: Kaiser to open medical school). Below is an excerpt from the article:

Kaiser Permanente will open its own independent medical school in Southern California, with its first class expected to enroll in fall 2019. The Oakland, Calif.-based not-for-profit system is planning a school that will emphasize patient care. Leaders say they want to bring Kaiser's “21st century medicine” model to a broader audience by teaching future doctors how to provide high-quality, population-based care for patients that relies upon a team-based approach to improve outcomes while lowering costs, a method that's proven successful for Kaiser....A legal entity for the school is expected to be established in the coming months, and Kaiser will begin planning for the accreditation process soon thereafter. Leaders haven't finalized a location in Southern California, but will begin looking for a dean in the coming year. Kaiser leaders have spent the past five years crafting a plan for the school, which expects to welcome around 44 students in its inaugural class....Kaiser still has to work through the details of how the school will be funded, but the system will consider using community benefit funding to support some of its existing medical education programs. Kaiser already operates a School of Allied Health Sciences in Richmond, Calif. Over 600 physicians are currently completing their residency programs at Kaiser facilities, and affiliated programs send several thousand more to the system for a portion of their training. Kaiser has 38 hospitals and a large network of clinics that serve over 10 million members in eight states and the District of Columbia, and recently announced it would acquire the Seattle-based Group Health Cooperative....The AAMC has expressed concern that new schools have opened and enrollment has grown as residency slots remain tight. When asked whether Kaiser is concerned it could be adding to that problem, ...[a Kaiser spokesperson] said the system continues to expand its already large residency program. 

Large health systems like Kaiser are appropriately concerned about their pipeline for physicians and allied health personnel. It's clearly in Kaiser's best interests to maintain high-quality residency programs and, now, to launch a a medical school to educate physicians in a way that supports their care delivery model. Note the emphasis in the excerpt above on training physicians who are focused on clinical care and improving outcomes while lowering costs. They are clearly anticipating value-based care and they want to train physicians who can practice in such an environment. One would think that the Cleveland Clinic might have had goals similar to those of Kaiser and yet they created a medical school to train physician investigators. I think in this latter case, they may have been pursing the interests of an influential donor. It's also interesting that, having created such a medical school, they have now aligned it with the long-established medical school in Cleveland, Case Western Reserve University. It may have been the case that they could no longer justify totally supporting the expense of a research-oriented medical school.

Increased Liquor Taxes Cause Sharp Reduction in New Gonorrhea Cases

In a recent article, a researcher has suggested that there is a relationship between increased liquor taxes and the incidence of a sexually transmitted disease (see: Liquor Taxes and Sexually Transmitted Infections). Below is an excerpt from it:

Maryland increased its liquor taxes in 2011 and a sharp decrease in the rate of new gonorrhea infections immediately followed. Researchers have determined that the two events are closely linked. The study, in The American Journal of Preventive Medicine, used three control groups to exclude other explanations for the decline. The first control group included all states that did not change alcohol taxes. The second group looked at states that did not share a border with Maryland, in order to avoid bias from people buying liquor in nearby states where the taxes were lower. And the third group eliminated states in which the government has a monopoly on hard liquor sales, since prices may rise in those states even without an increase in taxes. In 2011, the Maryland liquor tax rose to 9 percent from 6 percent. After the increase, Maryland’s gonorrhea rate declined by 24 percent — the equivalent of 1,600 cases per year. There was no decrease in the control states. The authors suggest that decreased alcohol consumption decreases sexual risk-taking, including unprotected sex, casual sex and sex with new partners.“Policy makers should consider raising liquor taxes if they’re looking for ways to prevent sexually transmitted infections,” said the lead author...[of the study]. “In the year and a half following the alcohol tax rise in Maryland, this prevented 2,400 cases of gonorrhea and saved half a million dollars in health care costs.”

It seems reasonable that as liquor becomes more expensive, fewer people purchase it and then fewer engage in sexual risk-taking when inebriated. A similar argument can be made regarding taxes on tobacco and smoking behavior. Numerous studies in high income countries have shown that a 10% increase in cigarette price decreases consumption by about 4%. Tax increases on tobacco also benefit governments, at least in the short term, by increasing tax revenue. Such taxes are also regressive in the sense that they increase the tax burden on poorer people who are more likely to smoke. Here is additional commentary on this point (see: Why States Like Sin Taxes):

Alcohol and cigarette taxes reduce consumption of substances that prove very unhealthy for a lot of their consumers. Whatever your position on the paternalism of cigarette taxes, I think it's fair to say that they have contributed to the decline in smoking, and they are probably most effective at deterring new smokers, who tend to be kids without all that much disposable income. Alcohol taxes, meanwhile, make it very expensive to get drunk, as opposed to having a couple of drinks. On the other hand, these taxes are also regressive, which makes a lot of progressives unhappy....Liberal advocates of sin taxes want to use them to cut consumption of dangerous substances, not to deliver an income tax cut to the wealthier precincts of the socioeconomic spectrum.

So let's refer to "sin taxes" as double-edge swords. They increase taxes, reduce healthcare costs, and improve health but they are also regressive and can represent a form of social engineering. My best guess about liquor and tobacco taxes, however, is that the politicians who raise them do not have the possible health advantages in mind when they do so -- they are simply trying to balance state budgets by seeking more revenue. The reduced rate of gonorrhea noted above resulting from increased taxes on liquor is an unexpected health bonus.

Walgreens Leases Clinic Space in Oregon and Washington to Providence Health

I have discussed in a number of previous notes the history of walk-in clinics in retail drug stores, particularly CVS's Minute Clinics and Walgreens' Healthcare Clinics (see: Epic EHRs Added to In-Store MinuteClinics; the Pursuit of Connectivity; Retail Chain Drug Stores Ramp-Up Their Healthcare Delivery Services). I also blogged some time ago about big box stores such as Walmart opening co-branded walk-in clinics that provided competition for the clinics in retail drug stores (see: Wal-Mart Launches Co-Branded Walk-In Medical Clinics in Three Cities; Cleveland Clinic Partners with Minute Clinic in Retail Health Services). I also made reference in the past to health systems which began to operate walk-in clinics in malls (see: Mayo Clinic to Open Walk-In Clinic in Mall of America). 

Over this time period, I began to assume that the walk-in clinic business model was stable with the national retail drug chains owning the facilities as opposed to the model whereby the chains would affiliate with hospital systems (see: Tighter Integration of CVS' MinuteClinic with Chicago's Advocate Health Care). However, a recent article suggested that the hospital leased model is far from obsolete (see: Providence to own healthcare clinics inside Walgreens stores in Ore. and Wash.). Below is an excerpt from it:

Renton, Wash.-based Providence Health & Services will lease space to own and operate healthcare clinics in multiple Walgreens drugstores across Oregon and Washington state. The deal marks the first time ...Walgreens Boots Alliance has allowed a health system to own and operate its in-store healthcare clinics, and it's the first time Providence has placed providers in a drugstore setting. Together, the companies plan to outfit up to 25 stores with clinics within the next two years, and expect to open the first six clinics in the Portland and Seattle metropolitan areas by early 2016....Nurse practitioners from Seattle-based Swedish Health Services, a Providence affiliate, will staff the three Seattle-area clinics, while Providence will staff the other three in the Portland area. Providence-owned clinics that run on the system's protocols and, more importantly, its electronic health record, will make for a smoother experience than what customers are used to now in retail clinics....He said primary-care providers have increasingly complained about a disconnect, especially with EHRs, between what happens to a patient at the retail clinic and what happens in the health system and their EHR....Although the deal gives Providence ownership rights for clinic space within its store, it represents much more than a lessee-lessor relationship....Providence won't be sharing revenue from the clinics, but the two organizations will engage in a “collaborative leadership governance council” made up of representatives from both who will jointly work on furthering their retail health efforts. As Walgreens moves away from managing its own retail clinics, Woonsocket, R.I.-based CVS Health, its major competitor, is investing in more. Following the acquisition of big-box retailer Target Corp.'s pharmacy and clinics business, CVS said it will take over as many as 80 of Target's clinics and rebrand them as CVS Minute Clinics, with plans to add 20 new clinics in Target stores over the next three years

Given this recent move by Walgreens, there now appears to be two models emerging for walk-in clinics located in retail drug stores -- the hospital leased approach and the drug chain owned approach. Here are what I see as the major advantages of the hospital-leased approach:

• Since such clinics can be immediately integrated into an existing and usually well known health system, hospital referrals for more complicated cases and also EHR support will be automatic. The clinics thus have the capability of managing more acute and complex patients than those normally seen with relatively minor problems.
• Although the article quoted above was silent on the idea of lab testing in walk-in clinics, I would bet that it would be easy to implement some POC testing on-site with the hospital-leased model (see: Some New Insights into Point-of-Care Testing and Devices). Lab testing has bedeviled Walgreens with its Theranos relationship that is now under review (see: Walgreens Scrutinizes Its Theranos Relationship More Closely).
• Walgreens obtains the increased drug store foot traffic with the leased Providence sites and will also experience a bump in prescription work without any of the hassles of managing a clinic.
• As to some kind of deeper relationship between Walgreens and Providence, the article hinted at such with the following statement: the two organizations will engage in a “collaborative leadership governance council." Stay tuned as to where this will end up and what type of retail relationships the Providence system is seeking.

Some New Insights into Point-of-Care Testing and Devices

On December 16, 2015, the Association for Pathology Informatics and Sunquest Information Systems presented a webinar entitled Informatics & Connectivity to Enhance Point of Care Testing as part of its 2015-2016 series which is devoted to the field of pathology informatics. The lecture was delivered by Dr. David McClintock who is a member of the pathology faculty at the University of Chicago Medicine. The video of the presentation is available for viewing. In this note, I would like to go over some of Dr. McClintock's key points and provide my personal analysis and interpretation of them. 

• Rapid growth of POC testing. Point-of-care testing is growing rapidly. This is both an advantage and a problem. Many of the POC instruments in the market are not designed to integrate easily with hospital information systems. One of Dr. McClintock's main responsibilities is to ensure that the quality of point-of-care test results are equivalent to those generated in the central laboratories. This is a challenge for a couple of reasons. First, the classic LIS vendors pay more attention to data in the central labs for historical reasons. They may not provide the means to seamlessly integrate POC test results into the LIS database. Secondly, POC testing may be performed by various hospital personnel who may not always be optimally trained for the testing. Even if it is stipulated that, say, a blood glucose should be performed by nurses, the task may be delegated to other personnel because of the crush of work.
• Integration of POCT results into the EHR database. In some cases, it may be technically easier for pathology IT personnel to integrate POC results into the EHR database than into the LIS database. This may be due, as noted above, to the fact that managing POC results may not always he a high priority for LIS vendors. The LIS database has always been defined as the source of truth regarding lab and pathology test results. This means that the LIS database is the reference database in terms of the completeness and quality of lab data. This perspective will not be be true if the EHR database contains information not be present in the LIS database. This will become even more challenging as the volume of POC test results increases. I think we may be witnessing a widening division between the management of hospital/central lab results and POC results. The latter seems to be more closely aligned with consumer results created and stored in wearable health devices.
• Desirability of wireless POC devices. Dr. McClintock emphasized that the selection of wireless handheld POC devices such as the i-STAT system in hospitals is highly desirable and should now be the first choice. His rationale for this was convincing. Demand for more POC testing is generated mainly by hospital staff and not lab professionals. Pathologists and lab scientists tend to favor central lab testing because it's cheaper, automated, and tests are performed in a controlled environment. Hospital physicians and staff favor POC testing because it provides more flexibility for them and the results are obtained in minutes. The deployment of wireless devices provides even more flexibility such that the tests can be performed truly at the point of patient care (i.e., bedside or patient-side).
• Ability of POC instruments to support entry of "other test results." Not all POC devices enable the input of "other" test results, which is say test results generated by other brands of POC devices. By way of contrast, the Roche Inform II is a hand-held glucometer that supports other test entry (OTE). The deployment of such instruments provides great flexibility to perform POC tests that do not offer wireless data entry. 
• Cost of testing. POC testing has historically been much more expensive than central lab testing because there are economies of scale with the latter whereas the former are customized for a single patient. When asked if the cost of POC testing would decrease, Dr. McClintock said that the cost per individual tests would decrease as technology allows a greater number of tests performed per cartridge. However, he also replied that the total cost and savings for the hospital of POC testing needs be taken into consideration. He cited as one example the need for a creatinine level prior to the administration of contrast for radiology imaging studies (see: Creatinine Testing Prior to Contrast Administration). By performing POC creatinine studies in radiology at his hospital, the number of cancelled imaging studies has been greatly reduced and the extra cost of the POC creatinine tests is far outweighed by the reduced number of cancelled studies.

NIH Funding for Clinical Trials Declines; Number of Pharma Trials Exploding

This is too important a trend to go unnoticed. The number of clinical trials funded by the NIH is declining precipitously (1,048 in 2014) and the number of pharmaceutical industry registered trials climbed to 6,550 in 2014. These facts were revealed in a recent article (see: The testing of new drugs is on the rise. Why that worries some people.). Below is an excerpt from it:

As the budget for the National Institutes of Health, the nation's largest funder of biomedical research, has flatlined over the past decade, the number of clinical trials funded by the federal agency has dramatically declined....At the same time, the number of trials funded by the pharmaceutical industry has exploded. The trend may not be much of a surprise — NIH's $30 billion budget in 2014 buys 14 percent less than it did in 2006, when adjusted for inflation. Meanwhile, the number of NIH-sponsored trials fell from 1,376 registered on a website in 2006 to 1,048 by 2014....Industry-sponsored trials grew by about 2,000 over the same period, reaching 6,550 registered in 2014....[T]he decline in federally funded trials concerns public health researchers, because federally funded trials are independent, often intended to compare drugs or other treatments instead of simply to show that a product works and should gain federal approval....[A] company seeking to sell a drug to lower cholesterol would be an unlikely sponsor of a trial pitting a dietary or lifestyle intervention against a number of different available drugs to discern what treatment plan is best overall....[T]here is extensive documentation through government-funded reports that trials have become increasingly complex and expensive....The combination of declining budgets and increasing costs would be expected to lead to fewer trials funded.....[There is a need] to look at the burden of a particular disease and allotting research dollars to those that have the greatest effect on mortality and disability. 

The first important point in the article for me was the growing imbalance between NIH funded trials and industry funded ones. NIH supports fewer of them due to a flatline budget but also because they are growing more expensive. Contrariwise, studies funded by the pharmaceutical industry are increasing rapidly. These two types of trials are not equivalent because the latter are designed, in part, to sell product rather than to compare competing drugs. I suspect the there is no way to design clinical trials to be less expensive. We may need to learn to live with this imbalance and, perhaps using meta-analysis, sharpen our ability to compare competing drugs across published studies.

The second interesting point in the article is that we may need to consider directing NIH funds to the treatment of diseases that cause a larger "burden" which is to say those with the greatest effect on disease and disability. This advice to take disease burden into consideration when funding NIH clinical trials will not be received well by researchers working on diseases that are less "burdensome." However, it seems to be a good way to deal with the funding of fewer trials. Here's a formal definition for disease burden:

Disease burden is the impact of a health problem as measured by financial cost, mortality, morbidity, or other indicators. It is often quantified in terms of quality-adjusted life years (QALYs) or disability-adjusted life years (DALYs), both of which quantify the number of years lost due to disease (YLDs).

As readers of this blog will understand, the bias of pharma-funded trials is more of a problem than the fact that such studies don't compare the company's drug against competing ones. Here's a quote from an article that summarizes this problem (see: Can the Source of Funding for Medical Research Affect the Results?):

Many clinical research studies are funded by pharmaceutical companies and there is a general perception that such industry-based funding could potentially skew the results in favor of a new medication or device. The rationale underlying this perception regarding the influence of industry funding is fairly straightforward. Pharmaceutical companies or device manufacturers need to increase the sales of newly developed drugs or devices in order to generate adequate profits. It would be in their best interest to support research that favors their corporate goals. Even though this rationale makes intuitive sense, it does not necessarily prove that industry-funding does influence the results of trials. However, there is also data to support the fact that the funding source does seem to correlate with the outcomes of clinical trials.

The Theranos Deals: How Some Organizations May Have Been Lead Astray

On December 11, 2015, I posted a tweet (@labsoftnews) that listed the names of major organizations that had been publicly linked with Theranos in recent months. It attracted a lot of attention, at least from my perspective (2,300 impressions and 30 retweets). These Theranos deals ranged from the deployment of in-store blood collections facilities in the case of Safeway and Walgreens to lab testing, or the intention to provide lab testing, for organizations. At this point, all of these arrangements have been terminated or seem to be under scrutiny. Below is my tweet in its entirety:

Theranos deals aborted or faltering so far: Walgreens, Safeway, US Army, Pfizer, Glaxo, Cleveland Clinic, Intermountain Health, Carlos Slim [Foundation].

I think that part of the interest in the tweet is due to the fact that Theranos to is currently on everyone's lips. Additionally, I think that the listing of eight prestigious organizations that had relationships with Theranos was riveting for readers. I began to ponder about the motivation for these organizations to make plans with Theranos that may now look like a mistake. I came up with the following four ideas:

• In some of these cases such as Walgreens, Safeway, the U.S. Army and the Cleveland Clinic, the decision to launch a relationship with Theranos was made at the highest executive level without much discussion with the lower level experts.
• In most of the cases, the Theranos "story" was so appealing that it overrode other practical consideration such as whether the company would be able to deliver on its promise of performing a large number of tests on a drop of blood quickly and less expensively than othe reference labs in the country.
• In some of the cases, the Theranos deal never really amounted to much but Therano marketed the relationship as being more important than it actually was. This seems to have been the case with drug giants Pfizer and Glaxo.
• We do not know at this time the extent to which the offer of shares of what appeared to be a hot stock influenced the organizational decisions to work with Theranos.

I want to focus briefly on the notion of the naiveté on the part of executives about the complexity of clincal laboratory testing. I hold the opinion that many hospital executives, for example, view lab testing as a matter of squirting blood or serum into an analyzer and generating test results. They may be hazy about details such as quality control, proficiency testing, federal regulation, and lab inspections. In fact, I think that some of the Theranos executives may need some schooling on these same topics. One might think that the validity of the Theranos "story," summarized in the second bullet point above, might have raised concerns among executives even if they were not experts in lab testing. In such cases, they may have been impressed by the apparent prestige of Theranos brand based on its announced relationships which, in fact, were not as iron-clad as they seemed. 

Free Webinar on Connectivity to Enhance Point-of-Care (POC) Devices

The Association for Pathology Informatics (API) and Sunquest Information Systems are offering a free webinar entitled Informatics & Connectivity to Enhance Point of Care Testing on December 16, 2015, from 1:00 p.m. to 2:00 p.m. The lecture will be delivered by David McClintock, M.D., Medical Director of Pathology Informatics and Point of Care Testing at The University of Chicago Medicine. Registration is free. Click here prior to the presentation to register.

The volume of point-of-care-testing (POCT) continues to grow because it is often favored by hospital physicians and nurses who can exercise partial local control over the devices and also obtain test results locally in minutes. Connectivity of these devices to the hospital LIS and EHR are critical so that the test results can be integrated into the electronic records of patients. Dr. McClintock oversees the IT integration of these devices in his home institution so is well versed in all aspects of this technology. This lecture is one in a continuing series of free webinars that will extend into 2016. All subsequent presentations will be noted in Lab Soft News. For those unable to participate live, video recording of the lecture will also be available.

Another Reason Why Many Physicians and Nurses Dislike EHRs

There are a host of reasons why physicians, both hospital and office based, dislike EHRs: they are not designed to optimize physician workflow, they are expensive and divert capital from other key projects, they enable EHR vendors to dominate hospital strategy, and they interfere with the physician relationship with patients. The latter problem can be corrected, at an increased cost, by hiring scribes to record patient conversations (see: The Explosive Growth of EHR Scribes; Back to the Future). In a recent post, Mr. HIStalk discusses another friction point connected to EHRs (see: News 12/4/15). Below is an excerpt from it:

From Sport Pepper CMIO: “Re: EHRs. This is an interesting article which highlights what many of us know already.” The article in The Journal of Bone & Joint Survey looks at the post-implementation gap in EHR satisfaction, where IT people and administrators are happy but clinicians aren’t (see: The Growing Gap in Electronic Medical Record Satisfaction Between Clinicians and Information Technology Professionals). That’s not too surprising since those non-clinicians have the most influence on which systems are chosen and how they are implemented. The article hints and what I’ve always claimed – it’s not so much that clinicians hate the concept of EHRs, they realize that both internal and external non-clinicians employ them as a blunt instrument (sometimes with the best of intentions, at least based on their own agendas) to create and enforce new rules that deliver minimal patient value. Few people enjoy using technologies intended to control their behavior – that would be like a prisoner loving their ankle monitor.

In my experience, echoed by others, hospital executives care most about the hospital bottom line. EHRs are designed primarily to generate patient bills because this is the most desired functionality sought by hospita purchasers. A variation on this financial theme is that EHRs can are used as a "blunt instrument," as noted in the quote above, to control the utilization of services by physicians. One example of this is to manage their drug, test, and imaging ordering behavior (see: EMR-Based Order Sets as a Locus of Control of Hospital-Based Physicians). This is a variation of the theme of the EHR as a blunt instrument.

Some Fundamental Flaws in the Current Theranos Business Model

I have been mulling over the current Theranos business model and have come to the conclusion that it is based on some fundamental flaws. In this note, I want to discuss these flaws and provide my reasoning for listing them:

1. Overemphasis on direct access testing (DAT). I am personally enthusiastic about DAT and have been blogging about the topic for eight years. However, DAT remains a niche market. Most consumers who are very interested in their health have healthcare insurance that covers most lab testing. It's far more convenient to have blood drawn in a doctor's office or in a hospital than traveling to, say, a Theranos blood drawing station in a Walgreens drug store. Both Quest and LabCorp have conveniently located patient service centers to draw blood samples. The size of the DAT market is not known but I believe that it is a very small percentage of the total reference lab business. It consists of the "worried well" whose doctors may balk at ordering too many tests and some price conscious shoppers.
2. Slow and expensive regulatory path. As both a manufacturer of IVD equipment and a reference lab, there is only one regulatory path available for Theranos -- the FDA and CLIA. Although one Theranos test, HSV-1, has been approved via 510(k) by the FDA, it is not necessarily a sure thing that similar approval can be achieved for the remainder of the Theranos analyzer test menu. It has also been reported that a formal complaint about the company has been filed with the FDA regarding proficiency testing (see: Problems with Theranos' Lab Proficiency Testing; Another Layer of Difficulty?). Moving through these federal hurdles wil be a slow and expensive process. 
3. Quest and LabCorp will be strong competitors. Theranos is now operating as a routine, mid-size reference lab using standard IVD analyzers in two states. The reference lab business is a high volume, low margin affair and Theranos is already on record as charging less than competing labs (see: unparalleled transparency). Most private physicians do not have a choice about where their patients' lab testing will be performed -- it's determined by provider network contracts. Both Quest and LabCorp also provide courier services for blood specimens pick-up at physicians' offices. Quest Sonora is going head-to-head with Theranos with a blood drawing station in a Scottsdale Safeway store (see: Sonora Quest Labs begins offering services at N. Scottsdale Safeway).
4. Theranos' announced increased test volume may increase its burn rate. Theranos has reported that its test volume is increasing despite the recent bad publicity (see: Surprise: Theranos CEO Says Company Is Doing More Tests Than Ever). This may not necessarily be good news if the company is not turning a profit but, of course, most unicorns are more concerned with funding rounds than breakeven. However, some of the negative publicity about the company may affect such new funding rounds (see: Theranos may be seeking to raise $200 million in new funding). 
5. Questions about the validity of finger stick blood specimens. For months, lab professionals have raised questions about the quality of finger stick specimens compared to venepunctures. One current report suggests that finger stick specimens are not consistent over time (see: Rice University Researchers Publish Study about Variation in Drop-to-Drop Samples of Capillary Blood Collected by Fingerpick and Used for Clinical Laboratory Testing). These questions may impose another layer of uncertainty on the ongoing FDA 510(k) approval process.
6. Lack of excitement about Theranos as it operates as a "standard" reference lab. As it exists now and certainly in the short term, Theranos will remain a mid-size reference lab operating in two states. Much of the buzz about the company has been focused on quotes from its founder, Elizabeth Holmes, and its prospects as a disrupter in a stodgy reference lab industry. What happens if these intangibles evaporate? Walgreens seems to have put its relationship with Theranos on pause. Safeway is now working with a competitor, Sonora Quest.

Why Has Theranos Been Unable Thus Far to Defend Its Science?

A recent article discussed the problems that Theranos has been having from both a professional and PR perspective (see: PR lessons from the Theranos debacle: Defend the science). One of the major key points is that Theranos has failed to "defend its science" and also failed to produce a "respected medical ally" that could assist the company is its defense against critics. There have been a multitude of calls over previous weeks for Theranos to produce its data for validating the accuracy of its proprietary analyzer. For me, this is just another way of asking the company to defend its science. Below is an excerpt from the article:

Throughout the [Theranos] debacle Holmes has been front and centre, not shying away from the assault. And while some PR professionals have interpreted this as a display of strength, Janet Vasquez [from JV Public Relations] thinks “it hasn’t been enough and ”[She] could have done more.".... Ms.Vasquez points out that the main value behind companies such as Theranos lies in the science behind them. When that’s attacked, it must be protected. And by not producing a respected medical ally with the right credentials to defend Theranos and its science,...the CEO committed a significant PR faux pas....“Theranos failed in effectively defending its science. ”Theranos is still standing ━ on top of a tidy little $9-billion valuation, no less ━ but the slings and arrows keep coming...."

All of this calls into question of why Theranos has not been unwilling or unable to defend its science thus far. I have come up with three possible reasons:

• In order the defend the science, it would be forced to reveal details about its proprietary analyzer to its competitors. 
• The company is well able to defend its science but it does not think that such a defense, even if adequate, would quiet its critics. 
• The maturity of its science and technology has lagged behind its marketing campaign and it is thus unable to defend its science at this time.

For me, only the third reason strikes me as reasonable. At the present time, only one Theranos test, herpes (HSV-1), has been approved under the 510(k) premarket approval process of the FDA by comparing it to a predicate device (see: THERANOS HERPES SIMPLEX VIRUS-1 (HSV-1) IgG ASSAY). However, even that particular test can't be performed in its own labs because its nanotainer, used to collect and store blood samples, has been classified by the FDA as a Class II device and needs clearance for interstate commerce (see: Two FDA Inspection Reports Show Theranos’ Blood-Collection ‘Nanotainer’ Was an Uncleared Class II Medical Device). 

Theranos is both a reference lab and an IVD manufacturer. For the sake of this discussion, I will proceed on the assumption that it is mainly operating as the latter in the eyes of the FDA. It needs to apply for 510(k) approval for all of the analytes that it wants to perform on its analyzer. The company has suggested that this process will be relatively routine but I have my doubts given the complexity of the problem. However, I can say one thing for certain at this time. The major path for defending its science runs through the FDA.