Elizabeth Holmes Defends Theranos Amid Media Scrutiny At Fortune's Global Forum | Fortune — Transcript

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1. 0:01thank you everyone Elizabeth thank you
2. 0:02for for being with us uh a as you know
3. 0:06uh Fortune went all in on the Theos
4. 0:08Story I mean the the notion that with a
5. 0:10single pin prick you could get blood and
6. 0:13do many dozens of blood tests at one
7. 0:17time at a much lower cost was uh
8. 0:20compelling uh as it was obviously to
9. 0:23your funders we put you I think we were
10. 0:25the first magazine to put you on the
11. 0:26cover uh we even put you uh last year on
12. 0:29our business business person of the year
13. 0:30list which we'll be uh honoring you and
14. 0:33others for tonight so it was kind of a
15. 0:36shock to us to to discover a few weeks
16. 0:39ago that you're really only doing one
17. 0:41test with that pin prick do you think
18. 0:44the hype do we let did we both let the
19. 0:47hype get ahead of the story if you're
20. 0:48only doing one
21. 0:50test well let me let me just start by
22. 0:52saying and I'll talk about that decision
23. 0:55to transition our systems to the FDA
24. 0:58framework which led us right now now as
25. 1:00of this moment for the last few weeks
26. 1:02only to run just one test in a minute
27. 1:05but I think you know part of this is
28. 1:07we've we've looked at all of these
29. 1:09articles over the course of the last
30. 1:12couple weeks and I'm an engineer and
31. 1:15we've tried to approach this the way we
32. 1:17approach everything which is
33. 1:19understanding you know what was written
34. 1:22um what's accurate what's not accurate
35. 1:25and how did it happen and um and so we
36. 1:29we went through these in detail and
37. 1:31we've seen that much of what has been
38. 1:33written is not accurate and so we've
39. 1:37asked ourselves what what did we do to
40. 1:40get into this kind of place in which
41. 1:43we're reading this kind of stuff all
42. 1:44over the national media and what we've
43. 1:48concluded from that is that we need to
44. 1:52do a better job of communicating and we
45. 1:56want to be the best at that I as you can
46. 1:58tell from this coverage I'm definitely
47. 2:00not a PR person and so you know we need
48. 2:03to get that out there and and part of
49. 2:05that was that you know we have not put
50. 2:08into the public domain much of our
51. 2:10technology and operations historically
52. 2:12we've talked about our work that we're
53. 2:14doing on the policy front in the context
54. 2:16of prevention and early detection but we
55. 2:18haven't talked about our devices and the
56. 2:21fact we've developed hundreds of well I
57. 2:22want to and I want to come back to that
58. 2:24about putting the data and the
59. 2:25information out in the public domain so
60. 2:27people can really see what you're doing
61. 2:29but let's stick with the communications
62. 2:30thing for for a second because I I I I
63. 2:33actually think you are an extraordinary
64. 2:34communicator and I want to show a clip
65. 2:36we have from the Ted uh talk that you
66. 2:40did I don't know nine months ago let's
67. 2:43just take a look at this clip and then
68. 2:44and then talk about it can we play the
69. 2:46uh play the clip please we've made it
70. 2:49possible to run comprehensive laboratory
71. 2:53tests from a tiny sample or a few drops
72. 2:57of
73. 2:58blood that could be taken taken from a
74. 3:06finger and we've made it
75. 3:09possible to eliminate the tubes and
76. 3:11tubes of blood that traditionally have
77. 3:14to be drawn from an
78. 3:17arm and replaced it with the
79. 3:22nanotainer so so there to we have made
80. 3:25it possible to do comprehensive lab
81. 3:27tests from a prick from the finger and
82. 3:29to eliminate the tubes and tubes of
83. 3:32blood yeah in retrospect when you when
84. 3:35you look at where you are today one test
85. 3:37with the prick of blood wasn't that
86. 3:39going too far so we we have developed
87. 3:43hundreds of tests over the course of the
88. 3:45last 12 years that can run a tiny sample
89. 3:48using proprietary Theos technology and
90. 3:52part of when I talk about communicating
91. 3:54what we need to do is we need to get
92. 3:56that data out there and I've talked
93. 3:57publicly um over the course of the last
94. 3:59couple weeks that we've made a decision
95. 4:01now to take the data that we've
96. 4:03generated for our FDA submissions and
97. 4:06put it into the public domain and we
98. 4:09will yeah but since you're focused on
99. 4:11the one test let's talk about why we're
100. 4:13doing that I have and by the way it's
101. 4:16not just me that was focused on the one
102. 4:17test that was sort of the story The
103. 4:20Theos story was all about this one pin
104. 4:23prick that would let you do
105. 4:25comprehensive blood testing that was the
106. 4:28story yeah well well I I think this is
107. 4:31what we sort of need to dissect a little
108. 4:33bit so when you look at Theos Theos
109. 4:35makes devices we make chemistries we
110. 4:38make consumables we make software and we
111. 4:40have a little tube called a nanotainer
112. 4:42which we use to collect our blood we
113. 4:45went in in 2013 to the FDA and we said
114. 4:49we want to be the company that works on
115. 4:52building a model for taking all of this
116. 4:54technology that's developed under the
117. 4:56lab framework through the FDA framework
118. 4:59and we believe in it so strongly because
119. 5:01we believe in an individual's right to
120. 5:04access their own data and so we have
121. 5:05been and we've been working on that for
122. 5:07two years now what happened in the last
123. 5:09few weeks is that we decided that we
124. 5:11would take just the tube not the tests
125. 5:14not the devices not the chemistry and
126. 5:16cut it over to the FDA quality system
127. 5:19which meant that temporarily as we
128. 5:22transition which is now been just a few
129. 5:24weeks we would not be using that tube to
130. 5:27collect our samples right this has
131. 5:29nothing
132. 5:30now now you're confusing me how many
133. 5:32tests are you doing right now from a
134. 5:34simple pin prick as you described in
135. 5:37that Ted Talk yeah so right now just
136. 5:39because of this FDA transition one we're
137. 5:41only doing one okay right okay but that
138. 5:43doesn't mean that we don't have the
139. 5:44technology to do them or that we haven't
140. 5:46done them in the past and are you
141. 5:47confident that you will get the FDA
142. 5:50approval to do the 200 that are a
143. 5:52standard part of the the draw well we've
144. 5:56so there's there's multiple parts to
145. 5:57this one is the Val validation of those
146. 6:00tests under the lab framework the other
147. 6:02one is the FDA submission and this is an
148. 6:04area of evolving policy that we're
149. 6:06working to create a leadership position
150. 6:08in we've never talked publicly about
151. 6:10what the status of what we're doing with
152. 6:12FDA is because we just hadn't felt that
153. 6:15was appropriate um until we got into all
154. 6:17of this recent press Communications but
155. 6:20um we're incredibly confident in the
156. 6:22data that we've submitted to the agency
157. 6:24we've worked on it for two years and
158. 6:27we've met the standard of comparing our
159. 6:28tubes to vacutainers which are the big
160. 6:31tubes that come from the arm and we're
161. 6:33hopeful that we'll see we'll see those
162. 6:35so you feel confident that that Vision
163. 6:37you laid out nine months ago will still
164. 6:40happen that you'll be able to do
165. 6:41comprehensive tests from a single PRI
166. 6:43absolutely and we've done it in the past
167. 6:45and we're going to continue to do it in
168. 6:46the future what if you this has been a
169. 6:48baptism by fire for you it's obviously
170. 6:50been a very tough cut that was a very
171. 6:51tough story in the Wall Street Journal
172. 6:53other other people have piled on what
173. 6:56have you learned in the process I mean
174. 6:58you started this at a very young age you
175. 7:00were only 19 years old there's no reason
176. 7:02why you should know what it's like to
177. 7:04run a N9 billion company or or deal with
178. 7:07this kind of a press attack but what
179. 7:09have you what what are the most
180. 7:11important lessons you've taken away from
181. 7:13this I I've learned I've learned the
182. 7:16point about about communication um I
183. 7:18think that you know we as a technology
184. 7:21company I I spent 10 years working with
185. 7:24a team of Engineers and scientists we
186. 7:25have a huge number of phds in our
187. 7:27company to develop these hundreds of
188. 7:29assays and um and we never talked to the
189. 7:32Press once right I mean we barely had a
190. 7:34website but you talked not for 10 years
191. 7:37U the first time we ever were in the
192. 7:38Press ever um in terms of communicating
193. 7:42uh externally was in the fall of 2013
194. 7:45when we began to launch our consumer
195. 7:47retail infrastructure and the reason
196. 7:49that we did it then is because so much
197. 7:52of what I want my life's work to be
198. 7:54about is empowering and andran people
199. 7:57with the right and access to their own
200. 7:59health information our our company is
201. 8:01actually not just about a pin prick it's
202. 8:03about access and it's about the ability
203. 8:06for people to afford care and to get
204. 8:08Convenient Care and to get early
205. 8:10detection and that means low prices it
206. 8:12means convenient locations but what
207. 8:14we've seen in this is that we never
208. 8:16talked about the technology and
209. 8:18operations on the back end because we
210. 8:20were so focused on our intellectual
211. 8:21property and what we want to do with
212. 8:24this now is introduce that to the world
213. 8:27so that people can see what we've built
214. 8:28one of the things you seen in the last
215. 8:30few weeks that a lot of medical experts
216. 8:32have come out expressing skepticism
217. 8:34about your technology in part because
218. 8:37they don't see peer peer reviewed
219. 8:39research they don't have access to your
220. 8:41data so you think in retrospect you
221. 8:43should have been more transparent I I
222. 8:45think right now we want to try to lead
223. 8:48in transparency me we I made a call that
224. 8:50if we would be the first lab with the
225. 8:52confidence to submit our test to FDA
226. 8:56that that would be the way to get the
227. 8:57data out but there's no reason we can't
228. 8:59do peer review and there's no reason we
229. 9:01can't publish other stats and we're
230. 9:02going to do that what about governance
231. 9:04you put together this incredible uh
232. 9:06board of directors that included George
233. 9:09Schultz Henry Kissinger Sam nun uh
234. 9:13Admiral ruad very distinguished
235. 9:16individuals none of whom uh have ever
236. 9:18run a company and none of whom knew
237. 9:21anything about the science of what you
238. 9:22were
239. 9:23doing well we invited people who were
240. 9:26brilliant strategic Minds many of whom
241. 9:28serve on some of the Boards of the best
242. 9:30public companies and they've played a
243. 9:33role as we've thought about how we can
244. 9:34leverage technology to transform policy
245. 9:37in the health care space and they still
246. 9:40play a role uh in our company in the
247. 9:42Strategic sense but would you have done
248. 9:44the board differently in retrospect
249. 9:46knowing what you know now maybe have
250. 9:47some regulatory experts some people who
251. 9:49could have helped you with the FDA
252. 9:51process or you know we we've built we've
253. 9:54begun building this medical board and I
254. 9:56think you know doing that at a board
255. 9:57level was a was a really good decision
256. 10:00um I you know we we we chose to jump
257. 10:03into this FDA world and knowing that it
258. 10:07was an area of evolving policy knowing
259. 10:09that it would be hard and and I was the
260. 10:11person who chose voluntarily to stop
261. 10:14using our nanotainer tube in the last
262. 10:16few weeks because I think it's the right
263. 10:17thing to do because there's no other way
264. 10:19to build this model who who do who do
265. 10:21you rely on I mean this was such a uh uh
266. 10:25such a big thing that happened to you if
267. 10:27if if I can say so very young in your
268. 10:30life who do you rely on for advice and
269. 10:32mentoring through uh on some of these
270. 10:35questions about how you build a company
271. 10:36how you build a board uh how you prepare
272. 10:39for regulatory approval Etc yeah well we
273. 10:42we've got Ian we've got phenomenal
274. 10:44people that I've had the privilege of of
275. 10:46hiring in our company um we've got um
276. 10:49people who are are on our board who have
277. 10:52been incredible mentors to me um and
278. 10:55it's been an amazing thing especially in
279. 10:57the last couple weeks as we've gone
280. 10:58through this to to benefit from the
281. 11:00community in Silicon Valley who has
282. 11:03reached out to us and said you know
283. 11:04we've seen this before how can we help
284. 11:06you and and I've learned I've learned a
285. 11:08lot from some of the Business Leaders
286. 11:10now you're your one of your business
287. 11:12partners of course was walgrrens which
288. 11:13has publicly said they' they're stopping
289. 11:16expansion to new stores of fael which is
290. 11:19only in Arizona right now right well
291. 11:21they haven't said that to us yeah but
292. 11:23they have not said that to you not not
293. 11:25to us no so you still expect to to build
294. 11:28out to uh Walgren stores well we're
295. 11:31talking with them and we were at a point
296. 11:33in which we'd completed our roll out in
297. 11:35Phoenix and we're looking at what the
298. 11:36next steps in that relationship are
299. 11:38they've they've been a great partner
300. 11:39with us in the context of our work in
301. 11:41Phoenix do you think given what you know
302. 11:44now about your your technology and the
303. 11:46regulatory challenges and so forth do
304. 11:49you think this company is a N9 billion
305. 11:51doll company well I think that's for
306. 11:53investors to decide but so far no
307. 11:55problem do you have all the money you
308. 11:57need to get through this uh tough period
309. 11:59absolutely you have no problem with
310. 12:01financing well I mean it's a very loaded
311. 12:03term we're definitely not in a position
312. 12:05in which we need to raise Capital right
313. 12:06now uh we have very little time here but
314. 12:09I want to transition to the conversation
315. 12:11that's about to happen because I do know
316. 12:13while most of the story over the last
317. 12:15year and a half has been about the pin
318. 12:17prick technology that you also have very
319. 12:20strong feelings about uh uh about
320. 12:24transparency about making sure that
321. 12:26people can get lab tests directly
322. 12:29without having to have it ordered by a
323. 12:31doctor you fought for a change in the
324. 12:33law in Arizona uh do you think that's
325. 12:36going to spread do you think the Health
326. 12:37Care system is fundamentally changing in
327. 12:39terms of the power that that the patient
328. 12:41has in the process I I think I think
329. 12:45that the answer to so many of our
330. 12:47challenges in health care lie in the
331. 12:49individual it's the reason that we have
332. 12:52tried to publicly communicate about what
333. 12:54it means for individuals to have the
334. 12:56right to their own health information or
335. 12:58to be able to afford it I think if we
336. 13:00can give individuals
337. 13:03lowcost access to health information I
338. 13:06think it changes everything in the
339. 13:07context of their ability to engage early
340. 13:10with access to actionable health
341. 13:12information and I think that's how we
342. 13:15realize a world in which early detection
343. 13:18becomes a reality which which can change
344. 13:20so much in our health system I I think
345. 13:22too that we're at an incredible point in
346. 13:26time in which technology can be applied
347. 13:28I know you know what we strive to do in
348. 13:31our own work is make this whole
349. 13:33experience of lab testing better and
350. 13:36more Humane and that's why we've worked
351. 13:38the way that we have you know I started
352. 13:42this company because I've lost people in
353. 13:44my family to cancer and other diseases
354. 13:47and I know what that means and I I think
355. 13:49that if you engage individuals with that
356. 13:52access you can change what what we've
357. 13:54all experienced there so much more I
358. 13:57would like to talk about but this is all
359. 13:58the time that we have Elizabeth thank
360. 14:00you very much for being with us