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Review: HBO film on Elizabeth Holmes, Theranos a chilling cautionary tale

Elizabeth Holmes certainly could talk a good game. Unfortunately, too many people were too willing to listen.
The disgraced founder of Theranos — and her forceful powers of persuasion —  are rigorously examined in Alex Gibney’s latest documentary, “The Inventor: Out For Blood in Silicon Valley.” Premiering at 9 p.m. Monday, March 18, on HBO, it makes for a jaw-dropping cautionary tale tied to money, greed, grand promises and blind trust.
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It’s also just one of two documentaries about Holmes and Theranos arriving in the next few days. On Friday at 9, ABC will air “The Dropout” under its “20/20” banner. The two-hour program, which was unavailable for review at press time, shares its name with the popular ABC News podcast, and is based on a lengthy investigation by technology and economics reporter Rebecca Jarvis.
In 2004 at the age of 19, Holmes dropped out of Stanford to start a biotech company that promised to revolutionize healthcare with a diagnostic device that would make blood testing faster and cheaper. Backed by big-name investors, including Larry Ellison and Rupert Murdoch, Theranos was valued at $9 billion in 2014, making Holmes the world’s youngest, self-made female billionaire.
Just one problem: the technology didn’t work. Holmes was eventually branded a fraud and the company imploded.
Gibney, whose credits include “Enron: The Smartest Guys in the Room” and “Going Clear: Scientology & the Prison of Belief,” is clearly fascinated by organizational deceit. To get to the heart of the spectacular debacle that was Theranos, he knows he needs to get inside the head of Holmes, even relying on a “behavioral economist” to provide some answers.

Young, attractive, idealistic, confident and incredibly driven, she was touted as “the next Steve Jobs.” Holmes dazzled both Silicon Valley and Wall Street with her idea for a compact, portable machine that could quickly diagnose many infections and illnesses, using only finger-prick samples of blood.
She called her device The Edison, leading Gibney to draw comparisons between Holmes and America’s most famous inventor. Thomas Edison, the film asserts, often promised more than he could deliver. The so-called Wizard of Menlo Park knew how to tell a good story and was the first person to practice “the Silicon Valley art of fake it ’til you make it.”
Likewise, Holmes knew the power of a good story. In interviews, she spoke movingly of having lost a beloved uncle to skin cancer. Her dream, she said, was that fewer people “will have to say goodbye too soon to the people they love.” As for her commitment to the vision, well, she liked to quote Yoda: “Do or do not. There is no try.”
Who wouldn’t be seduced by that narrative? Former Theranos employees — and eventual whistle-blowers — Tyler Shultz and Erika Cheung speak in the film about how they were drawn in.
“I was totally gung-ho,” he says. “… You wanted (her concept) to be true, so badly.”
I “idolized” her, Cheung recalls. “I drank the Kool-Aid a little too quickly.”
So did a lot of other people, including members of the media. And powerful older men, it seems, were especially susceptible to Holmes’ charm. Former Secretaries of State George Shultz (Tyler’s grandfather) and Henry Kissinger, former senators Sam Nunn and Bill Frist, and former Secretary of Defense James Mattis were all recruited to sit on the Theranos board, lending it star-power credibility.
Trouble is, they and others failed to scrutinize what was going on behind the scenes. For years, Holmes reportedly had been misleading investors and retail partners such as Safeway and Walgreens, declining to reveal that the Theranos machines were riddled with flaws and prone to breakdowns. One former employee described it as a “comedy of errors.”
Those errors were cloaked for a long time as Theranos falsified test results and ignored reality checks amid a highly paranoid work environment fostered by Holmes and her top business partner, Ramesh “Sunny” Balwani. Departments were segregated. Emails were monitored. Employees who raised red flags were swiftly dumped in favor of those who went along with the program.
It wasn’t until investigative reporter John Carreyrou of The Wall Street Journal, who appears in the film, began poking his nose into Theranos did the company’s shenanigans come to light. In 2018, federal prosecutors indicted Holmes and Balwani for conspiracy to commit fraud. They both have pled not guilty.
Over two hours, Gibney chronicles it all with a lively mix of interviews, graphics and a number swooping shots across the abandoned Theranos headquarters in Palo Alto. Of the latter, it feels like you’ve been dropped into a lonesome ghost town, and there is an unmistakable chill in the air.
Contact Chuck Barney at cbarney@bayareanewsgroup.com. Follow him at Twitter.com/chuckbarney and Facebook.com/bayareanewsgroup.chuckbarney.

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