United States regulators have banned Elizabeth Holmes, the chief executive of Theranos, from owning or operating a medical laboratory for at least two years, in a major setback for the embattled blood-testing firm and its once widely lauded founder.
In a statement late Thursday, Theranos said the regulators also yanked the operating license of its Newark, California, laboratory and forbade the laboratory from taking Medicare and Medicaid payments for its services. Regulators will also levy a monetary penalty that Theranos did not specify.
The government's moves follow a review last year of the Newark plant, which came after questions arose about the effectiveness of Theranos's technology. The high-profile start-up rose to prominence on the promise that it could detect health ailments by testing blood drawn cheaply by the mere prick of a finger.
"We accept full responsibility for the issues at our laboratory in Newark, Calif., and have already worked to undertake comprehensive remedial actions," said Ms. Holmes in a statement. "Those actions include shutting down and subsequently rebuilding the Newark lab from the ground up, rebuilding quality systems, adding highly experienced leadership, personnel and experts, and implementing enhanced quality and training procedures."