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Following allegations that the company staged fake blood tests using commercial lab equipment to impress investors, Theranos announced today that it has reached a settlement in two lawsuits filed against the company by one of its investors, Partner Fund Management LP. sued Theranos for nearly $100 million, alleging Holmes & Co. lied about the company’s blood technology abilities to get them to invest. (PFM invested $96 million in Theranos in 2014.) Throughout the lawsuit, Theranos has denied all allegations.
The terms of the amicable settlement between the company and the hedge fund remain confidential, Theranos also announced in a press release today. “Theranos is pleased to have resolved both lawsuits with PFM. While we are confident that we would have been successful at trial, the resolution of these two matters allows our public offering to proceed and allows us to focus again where it belongs, which is on executing our business plans and creating value for our shareholders,” Theranos General Counsel David Taylor said of the settlement.
Now, Theranos says it will be able to channel all of its energy and capital into its miniLab technology. The miniLab is, at least in theory, a testing device that scans for up to 40 diseases using just a small blood sample. In October, after closing all remaining Theranos clinical laboratories and wellness centers and laying off 40% of the company’s staff, Elizabeth Holmes announced that the miniLab would be the sole focus of the company. There has been some skepticism around the miniLab technology, so as with all Theranos technology, we’ll just have to wait and see if that actually materializes. And then someone should probably verify that it actually works.