Elizabeth Holmes Through the Director’s Lens
Kira Peikoff was the editor-in-chief of Leaps.org from 2017 to 2021. As a journalist, her work has appeared in The New York Times, Newsweek, Nautilus, Popular Mechanics, The New York Academy of Sciences, and other outlets. She is also the author of four suspense novels that explore controversial issues arising from scientific innovation: Living Proof, No Time to Die, Die Again Tomorrow, and Mother Knows Best. Peikoff holds a B.A. in Journalism from New York University and an M.S. in Bioethics from Columbia University. She lives in New Jersey with her husband and two young sons. Follow her on Twitter @KiraPeikoff.
"The Inventor," a chronicle of Theranos's storied downfall, premiered recently on HBO. Leapsmag reached out to director Alex Gibney, whom The New York Times has called "one of America's most successful and prolific documentary filmmakers," for his perspective on Elizabeth Holmes and the world she inhabited.
Do you think Elizabeth Holmes was a charismatic sociopath from the start — or is she someone who had good intentions, over-promised, and began the lies to keep her business afloat, a "fake it till you make it" entrepreneur like Thomas Edison?
I'm not qualified to say if EH was or is a sociopath. I don't think she started Theranos as a scam whose only purpose was to make money. If she had done so, she surely would have taken more money for herself along the way. I do think that she had good intentions and that she, as you say, "began the lies to keep her business afloat." ([Reporter John] Carreyrou's book points out that those lies began early.) I think that the Edison comparison is instructive for a lot of reasons.
First, Edison was the original "fake-it-till-you-make-it" entrepreneur. That puts this kind of behavior in the mainstream of American business. By saying that, I am NOT endorsing the ethic, just the opposite. As one Enron executive mused about the mendacity there, "Was it fraud or was it bad marketing?" That gives you a sense of how baked-in the "fake it" sensibility is.
"Having a thirst for fame and a noble cause enabled her to think it was OK to lie in service of those goals."
I think EH shares one other thing with Edison, which is a huge ego coupled with a talent for storytelling as long as she is the heroic, larger-than-life main character. It's interesting that EH calls her initial device "Edison." Edison was the world's most famous "inventor," both because of the devices that came out of his shop and and for his ability for "self-invention." As Randall Stross notes in "The Wizard of Menlo Park," he was the first celebrity businessman. In addition to her "good intentions," EH was certainly motivated by fame and glory and many of her lies were in service to those goals.
Having a thirst for fame and a noble cause enabled her to think it was OK to lie in service of those goals. That doesn't excuse the lies. But those noble goals may have allowed EH to excuse them for herself or, more perniciously, to make believe that they weren't lies at all. This is where we get into scary psychological territory.
But rather than thinking of it as freakish, I think it's more productive to think of it as an exaggeration of the way we all lie to others and to ourselves. That's the point of including the Dan Ariely experiment with the dice. In that experiment, most of the subjects cheated more when they thought they were doing it for a good cause. Even more disturbing, that "good cause" allowed them to lie much more effectively because they had come to believe they weren't doing anything wrong. As it turns out, economics isn't a rational practice; it's the practice of rationalizing.
Where EH and Edison differ is that Edison had a firm grip on reality. He knew he could find a way to make the incandescent lightbulb work. There is no evidence that EH was close to making her "Edison" work. But rather than face reality (and possibly adjust her goals) she pretended that her dream was real. That kind of "over-promising" or "bold vision" is one thing when you are making a prototype in the lab. It's a far more serious matter when you are using a deeply flawed system on real patients. EH can tell herself that she had to do that (Walgreens was ready to walk away if she hadn't "gone live") or else Theranos would have run out of money.
But look at the calculation she made: she thought it was worth putting lives at risk in order to make her dream come true. Now we're getting into the realm of the sociopath. But my experience leads me to believe that -- as in the case of the Milgram experiment -- most people don't do terrible things right away, they come to crimes gradually as they become more comfortable with bigger and bigger rationalizations. At Theranos, the more valuable the company became, the bigger grew the lies.
The two whistleblowers come across as courageous heroes, going up against the powerful and intimidating company. The contrast between their youth and lack of power and the old elite backers of Theronos is staggering, and yet justice triumphed. Were the whistleblowers hesitant or afraid to appear in the film, or were they eager to share their stories?
By the time I got to them, they were willing and eager to tell their stories, once I convinced them that I would honor their testimony. In the case of Erika and Tyler, they were nudged to participate by John Carreyrou, in whom they had enormous trust.
"It's simply crazy that no one demanded to see an objective demonstration of the magic box."
Why do you think so many elite veterans of politics and venture capitalism succumbed to Holmes' narrative in the first place, without checking into the details of its technology or financials?
The reasons are all in the film. First, Channing Robertson and many of the old men on her board were clearly charmed by her and maybe attracted to her. They may have rationalized their attraction by convincing themselves it was for a good cause! Second, as Dan Ariely tells us, we all respond to stories -- more than graphs and data -- because they stir us emotionally. EH was a great storyteller. Third, the story of her as a female inventor and entrepreneur in male-dominated Silicon Valley is a tale that they wanted to invest in.
There may have been other factors. EH was very clever about the way she put together an ensemble of credibility. How could Channing Robertson, George Shultz, Henry Kissinger and Jim Mattis all be wrong? And when Walgreens put the Wellness Centers in stores, investors like Rupert Murdoch assumed that Walgreens must have done its due diligence. But they hadn't!
It's simply crazy that no one demanded to see an objective demonstration of the magic box. But that blind faith, as it turns out, is more a part of capitalism than we have been taught.
Do you think that Roger Parloff deserves any blame for the glowing Fortune story on Theranos, since he appears in the film to blame himself? Or was he just one more victim of Theranos's fraud?
He put her on the cover of Fortune so he deserves some blame for the fraud. He still blames himself. That willingness to hold himself to account shows how seriously he takes the job of a journalist. Unlike Elizabeth, Roger has the honesty and moral integrity to admit that he made a mistake. He owned up to it and published a mea culpa. That said, Roger was also a victim because Elizabeth lied to him.
Do you think investors in Silicon Valley, with their FOMO attitudes and deep pockets, are vulnerable to making the same mistake again with a shiny new startup, or has this saga been a sober reminder to do their due diligence first?
Many of the mistakes made with Theranos were the same mistakes made with Enron. We must learn to recognize that we are, by nature, trusting souls. Knowing that should lead us to a guiding slogan: "trust but verify."
The irony of Holmes dancing to "I Can't Touch This" is almost too perfect. How did you find that footage?
It was leaked to us.
"Elizabeth Holmes is now famous for her fraud. Who better to host the re-boot of 'The Apprentice.'"
Holmes is facing up to 20 years in prison for federal fraud charges, but Vanity Fair recently reported that she is seeking redemption, taking meetings with filmmakers for a possible documentary to share her "real" story. What do you think will become of Holmes in the long run?
It's usually a mistake to handicap a trial. My guess is that she will be convicted and do some prison time. But maybe she can convince jurors -- the way she convinced journalists, her board, and her investors -- that, on account of her noble intentions, she deserves to be found not guilty. "Somewhere, over the rainbow…"
After the trial, and possibly prison, I'm sure that EH will use her supporters (like Tim Draper) to find a way to use the virtual currency of her celebrity to rebrand herself and launch something new. Fitzgerald famously said that "there are no second acts in American lives." That may be the stupidest thing he ever said.
Donald Trump failed at virtually every business he ever embarked on. But he became a celebrity for being a fake businessman and used that celebrity -- and phony expertise -- to become president of the United States. Elizabeth Holmes is now famous for her fraud. Who better to host the re-boot of "The Apprentice." And then?
"You Can't Touch This!"
Kira Peikoff was the editor-in-chief of Leaps.org from 2017 to 2021. As a journalist, her work has appeared in The New York Times, Newsweek, Nautilus, Popular Mechanics, The New York Academy of Sciences, and other outlets. She is also the author of four suspense novels that explore controversial issues arising from scientific innovation: Living Proof, No Time to Die, Die Again Tomorrow, and Mother Knows Best. Peikoff holds a B.A. in Journalism from New York University and an M.S. in Bioethics from Columbia University. She lives in New Jersey with her husband and two young sons. Follow her on Twitter @KiraPeikoff.
How a Deadly Fire Gave Birth to Modern Medicine
On the evening of November 28, 1942, more than 1,000 revelers from the Boston College-Holy Cross football game jammed into the Cocoanut Grove, Boston's oldest nightclub. When a spark from faulty wiring accidently ignited an artificial palm tree, the packed nightspot, which was only designed to accommodate about 500 people, was quickly engulfed in flames. In the ensuing panic, hundreds of people were trapped inside, with most exit doors locked. Bodies piled up by the only open entrance, jamming the exits, and 490 people ultimately died in the worst fire in the country in forty years.
"People couldn't get out," says Dr. Kenneth Marshall, a retired plastic surgeon in Boston and president of the Cocoanut Grove Memorial Committee. "It was a tragedy of mammoth proportions."
Within a half an hour of the start of the blaze, the Red Cross mobilized more than five hundred volunteers in what one newspaper called a "Rehearsal for Possible Blitz." The mayor of Boston imposed martial law. More than 300 victims—many of whom subsequently died--were taken to Boston City Hospital in one hour, averaging one victim every eleven seconds, while Massachusetts General Hospital admitted 114 victims in two hours. In the hospitals, 220 victims clung precariously to life, in agonizing pain from massive burns, their bodies ravaged by infection.
The scene of the fire.
Boston Public Library
Tragic Losses Prompted Revolutionary Leaps
But there is a silver lining: this horrific disaster prompted dramatic changes in safety regulations to prevent another catastrophe of this magnitude and led to the development of medical techniques that eventually saved millions of lives. It transformed burn care treatment and the use of plasma on burn victims, but most importantly, it introduced to the public a new wonder drug that revolutionized medicine, midwifed the birth of the modern pharmaceutical industry, and nearly doubled life expectancy, from 48 years at the turn of the 20th century to 78 years in the post-World War II years.
The devastating grief of the survivors also led to the first published study of post-traumatic stress disorder by pioneering psychiatrist Alexandra Adler, daughter of famed Viennese psychoanalyst Alfred Adler, who was a student of Freud. Dr. Adler studied the anxiety and depression that followed this catastrophe, according to the New York Times, and "later applied her findings to the treatment World War II veterans."
Dr. Ken Marshall is intimately familiar with the lingering psychological trauma of enduring such a disaster. His mother, an Irish immigrant and a nurse in the surgical wards at Boston City Hospital, was on duty that cold Thanksgiving weekend night, and didn't come home for four days. "For years afterward, she'd wake up screaming in the middle of the night," recalls Dr. Marshall, who was four years old at the time. "Seeing all those bodies lined up in neat rows across the City Hospital's parking lot, still in their evening clothes. It was always on her mind and memories of the horrors plagued her for the rest of her life."
The sheer magnitude of casualties prompted overwhelmed physicians to try experimental new procedures that were later successfully used to treat thousands of battlefield casualties. Instead of cutting off blisters and using dyes and tannic acid to treat burned tissues, which can harden the skin, they applied gauze coated with petroleum jelly. Doctors also refined the formula for using plasma--the fluid portion of blood and a medical technology that was just four years old--to replenish bodily liquids that evaporated because of the loss of the protective covering of skin.
"Every war has given us a new medical advance. And penicillin was the great scientific advance of World War II."
"The initial insult with burns is a loss of fluids and patients can die of shock," says Dr. Ken Marshall. "The scientific progress that was made by the two institutions revolutionized fluid management and topical management of burn care forever."
Still, they could not halt the staph infections that kill most burn victims—which prompted the first civilian use of a miracle elixir that was being secretly developed in government-sponsored labs and that ultimately ushered in a new age in therapeutics. Military officials quickly realized this disaster could provide an excellent natural laboratory to test the effectiveness of this drug and see if it could be used to treat the acute traumas of combat in this unfortunate civilian approximation of battlefield conditions. At the time, the very existence of this wondrous medicine—penicillin—was a closely guarded military secret.
From Forgotten Lab Experiment to Wonder Drug
In 1928, Alexander Fleming discovered the curative powers of penicillin, which promised to eradicate infectious pathogens that killed millions every year. But the road to mass producing enough of the highly unstable mold was littered with seemingly unsurmountable obstacles and it remained a forgotten laboratory curiosity for over a decade. But Fleming never gave up and penicillin's eventual rescue from obscurity was a landmark in scientific history.
In 1940, a group at Oxford University, funded in part by the Rockefeller Foundation, isolated enough penicillin to test it on twenty-five mice, which had been infected with lethal doses of streptococci. Its therapeutic effects were miraculous—the untreated mice died within hours, while the treated ones played merrily in their cages, undisturbed. Subsequent tests on a handful of patients, who were brought back from the brink of death, confirmed that penicillin was indeed a wonder drug. But Britain was then being ravaged by the German Luftwaffe during the Blitz, and there were simply no resources to devote to penicillin during the Nazi onslaught.
In June of 1941, two of the Oxford researchers, Howard Florey and Ernst Chain, embarked on a clandestine mission to enlist American aid. Samples of the temperamental mold were stored in their coats. By October, the Roosevelt Administration had recruited four companies—Merck, Squibb, Pfizer and Lederle—to team up in a massive, top-secret development program. Merck, which had more experience with fermentation procedures, swiftly pulled away from the pack and every milligram they produced was zealously hoarded.
After the nightclub fire, the government ordered Merck to dispatch to Boston whatever supplies of penicillin that they could spare and to refine any crude penicillin broth brewing in Merck's fermentation vats. After working in round-the-clock relays over the course of three days, on the evening of December 1st, 1942, a refrigerated truck containing thirty-two liters of injectable penicillin left Merck's Rahway, New Jersey plant. It was accompanied by a convoy of police escorts through four states before arriving in the pre-dawn hours at Massachusetts General Hospital. Dozens of people were rescued from near-certain death in the first public demonstration of the powers of the antibiotic, and the existence of penicillin could no longer be kept secret from inquisitive reporters and an exultant public. The next day, the Boston Globe called it "priceless" and Time magazine dubbed it a "wonder drug."
Within fourteen months, penicillin production escalated exponentially, churning out enough to save the lives of thousands of soldiers, including many from the Normandy invasion. And in October 1945, just weeks after the Japanese surrender ended World War II, Alexander Fleming, Howard Florey and Ernst Chain were awarded the Nobel Prize in medicine. But penicillin didn't just save lives—it helped build some of the most innovative medical and scientific companies in history, including Merck, Pfizer, Glaxo and Sandoz.
"Every war has given us a new medical advance," concludes Marshall. "And penicillin was the great scientific advance of World War II."
This Boy Struggled to Walk Before Gene Therapy. Now, Such Treatments Are Poised to Explode.
Conner Curran was diagnosed with Duchenne's muscular dystrophy in 2015 when he was four years old. It's the most severe form of the genetic disease, with a nearly inevitable progression toward total paralysis. Many Duchenne's patients die in their teens; the average lifespan is 26.
But Conner, who is now 10, has experienced some astonishing improvements in recent years. He can now walk for more than two miles at a time – an impossible journey when he was younger.
In 2018, Conner became the very first patient to receive gene therapy specific to treating Duchenne's. In the initial clinical trial of nine children, nearly 80 percent reacted positively to the treatment). A larger-scale stage 3 clinical trial is currently underway, with initial results expected next year.
Gene therapy involves altering the genes in an individual's cells to stop or treat a disease. Such a procedure may be performed by adding new gene material to existing cells, or editing the defective genes to improve their functionality.
That the medical world is on the cusp of a successful treatment for a crippling and deadly disease is the culmination of more than 35 years of work by Dr. Jude Samulski, a professor of pharmacology at the University of North Carolina School of Medicine in Chapel Hill. More recently, he's become a leading gene therapy entrepreneur.
But Samulski likens this breakthrough to the frustrations of solving a Rubik's cube. "Just because one side is now all the color yellow does not mean that it is completely aligned," he says.
Although Conner's life and future have dramatically improved, he's not cured. The gene therapy tamed but did not extinguish his disorder: Conner is now suffering from the equivalent of Becker's muscular dystrophy, a milder form of the disease with symptoms that appear later in life and progress more slowly. Moreover, the loss of muscle cells Conner suffered prior to the treatment is permanent.
"It will take more time and more innovations," Samulski says of finding an even more effective gene therapy for muscular dystrophy.
Conner's family is still overjoyed with the results. "Jude's grit and determination gave Conner a chance at a new life, one that was not in his cards before gene therapy," says his mother Jessica Curran. She adds that "Conner is more confident than before and enjoys life, even though he has limitations, if compared to his brothers or peers."
Conner Curran holding a football post gene therapy treatment.
Courtesy of the Curran family
For now, the use of gene therapy as a treatment for diseases and disorders remains relatively isolated. On paper at least, progress appears glacially slow. In 2018, there were four FDA-approved gene therapies (excluding those reliant on bone marrow/stem cell transplants or implants). Today, there are 10. One therapy is solely for the cosmetic purpose of reducing facial lines and folds.
Nevertheless, experts in the space believe gene therapy is poised to expand dramatically.
"Certainly in the next three to five years you will see dozens of gene therapies and cell therapies be approved," says Dr. Pavan Cheruvu, who is CEO of Sio Gene Therapies in New York. The company is developing treatments for Parkinson's disease and Tay-Sachs, among other diseases.
Cheruvu's conclusion is supported by NEWDIGS, a think tank at the Massachusetts Institute of Technology that keeps tabs on gene therapy developments. NEWDIGS predicts there will be at least 60 gene therapies approved for use in the U.S. by the end of the decade. That number could be closer to 100 if Chinese researchers and biotech ventures decide the American market is a good fit for the therapies they develop.
"We are watching something of a conditional evolution, like a dot-com, or cellphones that were sizes of shoeboxes that have now matured to the size of wafers. Our space will follow along very similarly."
Dr. Carsten Brunn, a chemist by training and CEO of Selecta Biosciences outside of Boston, is developing ways to reduce the immune responses in patients who receive gene therapy. He observes that there are more than 300 therapies in development and thousands of clinical trials underway. "It's definitely an exciting time in the field," he says.
That's a far cry from the environment of little more than a decade ago. Research and investment in gene therapy had been brought low for years after the death of teenager Jesse Gelsinger in 1999 while he had been enrolled in a clinical trial to treat a liver disease. Gene therapy was a completely novel concept back then, and his death created existential questions about whether it was a proper pathway to pursue. Cheruvu, a cardiologist, calls the years after Gelsinger's death an "ice age" for gene therapy.
However, those dark years eventually yielded to a thaw. And while there have been some recent stumbles, they are considered part of the trial-and-error that has often accompanied medical research as opposed to an ominous "stop" sign.
The deaths of three patients last year receiving gene therapy for myotubular myopathy – a degenerative disease that causes severe muscle weakness – promptly ended the clinical trial in which they were enrolled. However, the incident caused few ripples beyond that. Researchers linked the deaths to dosage sizes that caused liver toxicity, as opposed to the gene therapy itself being an automatic death sentence; younger patients who received lower doses due to a less advanced disease state experienced improvements.
The gene sequencing and editing that helped create vaccines for COVID-19 in record time also bolstered the argument for more investment in research and development. Cheruvu notes that the field has usually been the domain of investors with significant expertise in the field; these days, more money is flowing in from generalists.
The Challenges Ahead
What will be the next step in gene therapy's evolution? Many of Samulski's earliest innovations came in the laboratory, for example. Then that led to him forming a company called AskBio in collaboration with the Muscular Dystrophy Association. AskBio sold its gene therapy to Pfizer five years ago to assure that enough could be manufactured for stage 3 clinical trials and eventually reach the market.
Cheruvu suggests that many future gene therapy innovations will be the result of what he calls "congruent innovation." That means publicly funded laboratories and privately funded companies might develop treatments separately or in collaboration. Or, university scientists may depend on private ventures to solve one of gene therapy's most vexing issues: producing enough finished material to test and treat on a large scale. "Manufacturing is a real bottleneck right now," Brunn says.
The alternative is referred to in the sector as the "valley of death": a lab has found a promising treatment, but is not far enough along in development to submit an investigational new drug application with the FDA. The promise withers away as a result. But the new abundance of venture capital for gene therapy has made this scenario less of an issue for private firms, some of which have received hundreds of millions of dollars in funding.
There are also numerous clinical challenges. Many gene therapies use what are known as adeno-associated virus vectors (AAVs) to deliver treatments. They are hollowed-out husks of viruses that can cause a variety of mostly mild maladies ranging from colds to pink eye. They are modified to deliver the genetic material used in the therapy. Most of these vectors trigger an antibody reaction that limits treatments to a single does or a handful of smaller ones. That can limit the potential progress for patients – an issue referred to as treatment "durability."
Although vectors from animals such as horses trigger far less of an antibody reaction in patients -- and there has been significant work done on using artificial vectors -- both are likely years away from being used on a large scale. "For the foreseeable future, AAV is the delivery system of choice," Brunn says.
Also, there will likely be demand for concurrent gene therapies that can lead to a complete cure – not only halting the progress of Duchenne's in kids like Conner Curran, but regenerating their lost muscle cells, perhaps through some form of stem cell therapy or another treatment that has yet to be devised.
Nevertheless, Samulski believes demand for imperfect treatments will be high – particularly with a disease such as muscular dystrophy, where many patients are mere months from spending the remainder of their lives in wheelchairs. But Samulski believes those therapies will also inevitably evolve into something far more effective.
"We are watching something of a conditional evolution, like a dot-com, or cellphones that were sizes of shoeboxes that have now matured to the size of wafers," he says. "Our space will follow along very similarly."
Jessica Curran will remain forever grateful for what her son has received: "Jude gave us new hope. He gave us something that is priceless – a chance to watch Conner grow up and live out his own dreams."