Has the Theranos Debacle “Poisoned the Well” for Blood Testing Companies?

“It was such a visible event, and everybody had made those associations and wanted to double-check that it wasn’t a widespread phenomenon in every blood testing company.”

Tim Blauwkamp, Co-founder and Chief Scientific Officer, Karius
Image Credit: Shutterstock.com

Once famous for a supposedly innovative approach to blood testing, now infamous for allegedly faking it, the names Theranos and Elizabeth Holmes aren’t fading away anytime soon, especially since the Holmes’ trial is currently underway, prompting new podcast and other media coverage. All of this has had a ripple effect for other companies that, like Theranos, were trying to make blood drawing and diagnostics easier for consumers. Even before Theranos imploded, its outsize presence was felt by other companies in the blood testing industry, for better and worse. Blood testing companies had to, in one way or another, come up with convincing explanations about how they were different from Theranos.

So I thought it would be interesting to revisit the competitive landscape of blood testing companies to see whether the “Theranos-Effect” has resulted in a shakeout of companies looking to drive change in that area. And it turns out that competition is alive and well, with several companies making strides in delivering options to assist consumers with more accessible blood testing products and services. Here’s a review of some of the companies out there today:


Genalyte out of San Diego, founded in 2007, has raised about $91.8 million in disclosed funding for its Maverick Detection System. Its backers include top venture capital firms like Khosla Ventures. The company claims that the Maverick Detection System can run up to 26 different tests on a single finger prick of blood in under 15 minutes and can handle approximately 250 patients per day. The platform is built around a disposable array that contains 12 of these silicon chips that can detect in real-time when proteins or antibodies bind to the sensors. Here’s a short video describing how the technology works:


A Silicon Valley startup that got its start in 2016, Athelas has a $3.5 million vote of confidence from Sequoia Capital, another major player in the tech VC world, bringing total funding to about $3.7 million. Its 60-second at-home blood test, housed inside what looks like an Amazon Echo, can reportedly test for diseases such as the flu, bacterial infections, and even cancer. Currently, the device is being used for cancer patients to monitor white blood cell counts for chemotherapy. More importantly, the company has been very transparent (the word appears twice on its website!) and even has FDA clearance for using its device for imaging diagnostics. Here’s a one-minute video showing the Athelas One device:


Silicon Valley-based Karius, founded in 2014, also has a connection to Stanford University, where the company’s pathogen-detection technology was first developed. It has raised $254 million to date, including a sizable $50 million Series A in August that included Khosla and Chinese tech giant Tencent. While requiring a full blood draw, the company can detect more than 1,000 pathogens (whether viral, bacterial, or fungal) by analyzing fragments of DNA in the blood. Here’s a video of a presentation by the Karius Chief Technology Officer Sivan Bercovici at a recent Amazon Healthcare and Life Sciences Symposium:


On the East Coast in Massachusetts, Day Zero Diagnostics, an early-stage biotech company founded in 2016, has reportedly taken in about $11.6 million in funding to date. Day Zero is developing a rapid, whole genome sequencing-based diagnostic that identifies the strain and antibiotic resistance profile of a bacterial infection from the blood within hours. Its machine learning algorithm Keynome uses MicrohmDB, a proprietary microbial resistance database, to determine antibiotic resistance from genomic data. The idea is to avoid using broad-spectrum antibiotics, which is contributing to the global crisis of antibiotic-resistant bugs. This past week, Day Zero Diagnostics was named one of the winners of the 3rd Annual UCSF Health Awards. Here’s a short promotional video:


Finally, Israeli company Sight Diagnostics has developed a Sight OLO product that provides 5-part CBC results with 19 parameters and sophisticated flagging capabilities. It is FDA 510(k) cleared for blood taken directly from either a finger prick or a venous sample. Sight OLO has been validated for patients aged three months and above in a variety of CLIA certified moderately complex clinical settings such as oncology, pediatrics, and urgent care. Sight OLO uses a disposable cartridge per test, eliminating the need for reagent procurement, storage, and liquid waste disposal. Here’s a brief video on the Sight OLO system:


Covering the entire blood testing industry is beyond the scope of a single blog post. In addition to those highlighted above, one could include companies like Grail. Clinical Genomics, CellMax Life, 20/20 Gene Systems, Brainshake, X-Zell, and Innamed to the mix. All are working on blood tests for diseases like cancer, Alzheimer’s, and various metabolic markers.

My take – The demise of Theranos doesn’t seem to have deterred startups or investors from trying to disrupt the blood diagnostic industry. Maybe the global blood testing market, valued at $73.9 billion in 2020 and expected to expand at a compound annual growth rate (CAGR) of 8.3% from 2021 to 2028, is one incentive. One common element in each of these companies is that they are the opposite of Theranos. They are run by actual scientists who take seriously the responsibility of delivering accurate blood tests quickly; they are carefully developing blood tests that work — one at a time; and they share results in peer-reviewed journals and comply with regulatory requirements.

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