Walgreens drops Theranos after reported California lab violations

By Marilyn Malara   |   Jan. 29, 2016 at 1:24 PM

NEWARK, Calif., Jan. 29 (UPI) -- Walgreens will no longer contract Theranos laboratories for blood tests after the Centers for Medicare & Medicaid Services reported the startup violated several clinical policies.

The drugstore chain announced Thursday they took immediate action to temporarily suspend business practices with Theranos after CMS publicized its findings the day before.

In a letter sent to the Silicon Valley startup developed in 2003 by Elizabeth Holmes, a Stanford University dropout, CMS asserted five serious deficiencies were discovered during its several month-long investigation, including one that allegedly poses "immediate jeopardy to patient health and safety."

Despite the California report, which notes a serious deficiency in the area of hematology, Theranos said in a statement it processes 90 percent of its lab tests at its laboratories in Arizona, which was not part of the survey.

In its defense, Theranos added the results of the CMS survey do "not reflect the current state of the lab."

"As the survey took place we were simultaneously conducting a comprehensive review of our laboratory's systems, processes and procedures to ensure that we have best-in-class quality systems," Theranos said.

Theranos has a reported 10 days to right a total of five deficiencies listed in the letter, dated Monday, CNBC reported.

"A full plan of correction will be submitted to CMS within days," the company assured.

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