Lessons that Investors should Learn From Elizabeth Holmes Trial

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Nonetheless, Theranos isn’t the only company that secured millions of dollars and defrauded its investors. Another example is uBiome which was investigated by the Federal Bureau of Investigation (FBI) for fraudulent billing. Another is Outcome Health which is a healthcare advertising company that provided misleading information to drugmakers on where their ads are appearing and how they are performing. 

Corporate malfeasance comes in waves, Sherman said, from Enron and WorldCom to Bernie Madoff and now Theranos. “We are in another era that has conditions that are conducive to promoting fraud.” 

How to detect a problem

“It’s important that we don’t assume that every company is like a Theranos, we just need to ask the right questions,” said Ruby Gadelrab, founder and CEO of MDisrupt, a medical diligence company for the health-tech industry, which aims to avoid making similar mistakes in the future.

“Health care, as a whole, is complex,” Gadelrab said. “It’s probably the hardest area to invest in.”