CMS Slaps Theranos with Sanctions, Bans CEO from Running Labs

By MedTech Intelligence Staff

Agency sanctions include a monetary penalty and revocation of the lab’s CLIA certificate.

CMS has taken a hard line against Theranos, imposing several sanctions against the company, including banning CEO Elizabeth Holmes from operating a lab for two years. It was back in April that the agency had initially suggested the ban.

According to a Theranos news release, CMS sanctions include:

  • Revoking Theranos’ Newark, California lab’s CLIA (Clinical Laboratory Improvement Amendments) certificate. This includes banning lab owners and operators from owning, operating or directing a lab for at least two years from the date of revocation. The revocation takes effect in 60 days.
  •  Limiting the lab’s CLIA certificate for hematology
  • Civil monetary penalty (amount unspecified)
  • Directed portion of a plan of correction
  • Suspending the lab’s approval to receive Medicare and Medicaid payments for any hematology services performed
  • Cancelling the lab’s approval to receive Medicare and Medicaid payments for all lab services

According to Holmes, remedial actions include shutting down the company’s Newark lab until further notice in order to build the lab from the “ground up, rebuilding quality systems, adding highly experienced leadership, personnel and experts, and implementing enhanced quality and training procedures,” she said in the company release.

Theranos will continue to provide services to customers via its lab in Arizona.

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