A recent ruling by the Food and Drug Administration (FDA) confirming the results of a blood test for herpes made headlines across the country.
The headlines weren’t over how the tests are composed chemically. Instead, it was over how the tests were conducted and the amount of blood needed.
A few drops are all that’s needed, or the amount commonly associated with a finger prick. That’s a far cry from the existing laboratory procedures calling for a vile with 500-1,000 times that draw from veins in your body.
The test is nothing new for Theranos, a 12-year-old company started in Palo Alto, California. For the previous decade, the company has been conducting this blood test – as well as more than 200 tests similar to this – with only a few drops of blood.
This is newsworthy because it is this is the first validation of Theranos’s procedures. Since the test uses the same chemical makeup of already-approved FDA tests, applying for accreditation was voluntary. Yet skepticism about the accuracy of the tests – with limited information available on what technology is behind the tests – prompted the company to seek FDA approval.
Six days after the news broke about the FDA’s approval, Theranos announced the addition of a major client on the East Coast. In Pennsylvania, Theranos will become the preferred lab work provider for the nearly 725,000 individuals insured by Capital BlueCross.
What’s truly remarkable about the tests is the price. Theranos makes their tests available for a fraction of the traditional laboratory cost. The herpes test, for example, is only $9.07. That’s half the Medicare rate of $18, and even a smaller percentage of the amount billed by traditional laboratories for the same basic test.
The company is seeking market share in a laboratory business valued at $73 billion annually. Research suggests seven out of 10 doctor decisions are based upon what lab work shows, and Theranos promotes their rapid response time in returning the data from these tests. Traditional laboratories usually take days for results where Theranos states only a few hours are required.
Outside of healthcare facilities, Theranos has a presence within retail locations. Several Theranos Wellness Centers exists within Walgreens in California and Arizona, providing their consumers with an option for blood work within a well-established retail-based company.
With so many favorable details about the services they provide, it’s easy to see why Theranos has grown – thus far – into a $10 billion company.