Jamie Hartford 1

November 29, 2016

2 Min Read
Rupert Murdoch, Other Big Names Invested in Theranos

The beleaguered blood-testing company is also facing a fresh lawsuit from investors.

Jamie Hartford

Australian media mogul Rupert Murdoch and other well-known investors are among those who pumped millions of dollars into Theranos before problems with its blood-testing technology came to light, according to the Wall Street Journal (WSJ). Now, they could lose everything they put in.

Murdoch--who ironically heads News Corp., parent company of the WSJ, which originally brought to light questions about the effectiveness of Theranos's technology in October 2015--invested $100 million in the company, which claimed it could run tests on just a few drops of blood. Other well-known investors named by the WSJ include Riley Bechtel, chairman of Bechtel Corp., a construction and engineering firm founded by his great grandfather; and Cox Enterprises, a privately held conglomerate with divisions covering broadband communications, automotive services, and media. 

In all, Theranos raised an estimated $725 million from outside investors, according to the WSJ article. In 2014, the company was reportedly valued at $9 billion, and its founder, chairman, and CEO Elizabeth Holmes had a net worth of $4.5 billion as late as last year, according to Forbes. This past June, the publication estimated her net worth at nothing.

The same day news of Theranos's high-profile investors broke, the company, Holmes, and COO Ramesh Balwani were also slapped with a fresh class action lawsuit from investors who allege that they made false statements, and misrepresented and omitted facts to get investors to purchase shares in the company. Among the allegations laid out in the lawsuit are that Theranos lied to customers and drugstore chain Walgreens, which had opened testing centers at some of its stores in Arizona and California.

"To them, being honest and forthright was an obstacle to their goals," the lawsuit claims.

Theranos did not respond to Qmed's request for comment.

Jamie Hartford is director of content for medtech brands in UBM's Advanced Manufacturing Group. Reach her at [email protected].

[image courtesy of THERANOS]

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