On week after another, unfortunate news has been trickling in for Theranos. The health-tech venture has today suffered another setback as its blood-testing facilities have failed a major U.S regulatory inspection, reports WSJ.

This development cites people familiar with the matter and suggests that the investigation happened back in September. This was their last standing blood-testing lab at the time. And the company next month announced that it is exiting the laboratory business and plans to build portable medical testing machines. Instead of disclosing the closure of its final laboratory, Theranos decided to make light of the situation – even when it was suffering internally.

The report further suggests that operational deficiencies were found when representatives from Centers for Medicare and Medicaid Services  (CMS) visited the Theranos testing lab in Scottsdale, Arizona. The company has suffered a similar closure in the form of its California blood-testing lab last year. Commenting on the closure of the laboratory, Theranos general counsel David Taylor said,

After months of careful consideration, and prior to CMS’s unannounced inspection in Arizona, Theranos decided to close its laboratories.

Further, adding on the deficiencies found at the testing lab, Taylor added,

Theranos has been responding to the deficiencies raised by CMS and will continue the process of revising or voiding test results as appropriate until we are satisfied that we have taken all necessary remedial action.

The health-tech company founded by Elizabeth Holmes suffered this major setback on the heels of the recent layoffs. Theranos has shown nearly 150 employees the door a couple weeks ago. And now it has around 220 professionals to take care of R&D, PR, HR, and everything else. This, however, isn’t the only problem being faced by the company. It has been facing similar testing lab inspection failures, lawsuits, and other litigations against its healthcare practices and techniques.

The disclosure of Theranos’ blood-testing lab being shuttered has also coincided with another major change in the working of the company. It has today announced the recruitment of engineering and biomedical device design experts to form a newly created Technology Advisory Board (TAB). They will serve alongside the existing Science and Medical Advisory Board.

With this reshuffling in the company structure, some notable members including  Henry Kissinger, George Shultz, and James Mattis have left the board. New members, namely Dr. Channing Robertson and Howie Rosen have been brought in to co-lead the newly created board. Talking about his appointment, Robertson said,

We are pleased to have the opportunity to convene these leaders in engineering from academia and industry. They share our belief in the potential for the miniLab, and we look forward to leveraging their expertise as the company works towards bringing the miniLab to primary care settings.

This eight-member board will now be responsible for reviewing Theranos’ product development, design, and deployment, interacting with technology teams, sharing their vision through peer review publications and proposing new technologies related to their core business. And the same now revolves around making a miniature lab test for detecting the Zika virus.

Now, Theranos needs to compose itself and develop a product which is sufficiently flawless and working. Then only will it be able to regain its hyped $9 billion valuation, which now lingers around some hundreds of millions.

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