October 21, 2015 / 4:21 PM / 5 years ago

Theranos CEO says company's underlying technology is sound

(Reuters) - Theranos Chief Executive Elizabeth Holmes fought back on Wednesday against accusations that the technology at the heart of the blood-testing startup has grave flaws.

Elizabeth Holmes, founder and CEO of Theranos, speaks with Jonathan Krim, global technology editor at the Wall Street Journal, at the Wall Street Journal Digital Live (WSJDLive) conference at the Montage hotel in Laguna Beach, California, October 21, 2015. REUTERS/Mike Blake

Holmes defended her company at a technology conference hosted in Laguna Beach by the Wall Street Journal, which last week published a pair of stories suggesting her startup was relying on tools from traditional labs as it struggled with its own technology.

But Holmes said the company has moved away from one of its devices only briefly as it transitions to getting approval from the Food and Drug Administration for all of its tests. She cited her successful lobbying for an Arizona law allowing patients to get blood tests without a doctor’s order.

“I personally in Arizona worked very hard to change the law,” she said. “I can’t do that without knowing that the tests that are offered are of the highest quality.”

Theranos, which has a valuation of $9 billion, promised to shake up medical testing by conducting a wide range of tests with one drop of blood from a finger-stick, rather than the large vial typically collected.

But the Journal has reported that the company now uses the tiny vials, known as nanotainers, for just one of its tests, responding to concerns from regulators. The newspaper also reported that former employees doubt the reliability of Edison, the company’s proprietary lab tool. While it is used for just a fraction of tests, it is key to Theranos’s strategy.

Holmes acknowledged that Theranos has used technology from other labs for tests from venous draws but stressed that the company relies on its own technology for finger-stick tests. She noted that Theranos has received FDA approval for one test and expects to get clearance for others.

“We are the exact same company that we were,” she said. “We’ve done 3.5 million tests. We have tens of thousands of people who have rated our service.”

Holmes, 31, is a darling of Silicon Valley, drawing comparisons to the late Apple founder Steve Jobs for her bold vision and penchant for wearing black turtlenecks. Her company has won the backing of investors including Oracle Corp. cofounder Larry Ellison and venture-capital firm Draper Fisher Jurvetson.

The Journal has stood by its reporting on the company.

“The Journal reiterates that our articles about Theranos were thoroughly reported, fair and wholly accurate,” the newspaper said in a statement issued after Holmes’ talk.

Reporting by Julia Love; Editing by Chizu Nomiyama and David Gregorio

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