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.
Elizabeth Holmes.
"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.
Shoot for the Moon: Its Surface Contains a Pot of Gold
An astronaut standing on the Moon.
Here's a riddle: What do the Moon, nuclear weapons, clean energy of the future, terrorism, and lung disease all have in common?
One goal of India's upcoming space probe is to locate deposits of helium-3 that are worth trillions of dollars.
The answer is helium-3, a gas that's extremely rare on Earth but 100 million times more abundant on the Moon. This past October, the Lockheed Martin corporation announced a concept for a lunar landing craft that may return humans to the Moon in the coming decade, and yesterday China successfully landed the Change-4 probe on the far side of the Moon. Landing inside the Moon's deepest crater, the Chinese achieved a first in space exploration history.
Meanwhile, later this month, India's Chandrayaan-2 space probe will also land on the lunar surface. One of its goals is to locate deposits of helium-3 that are worth trillions of dollars, because it could be a fuel for nuclear fusion energy to generate electricity or propel a rocket.
The standard way that nuclear engineers are trying to achieve sustainable fusion uses fuels that are more plentiful on Earth: deuterium and tritium. But MIT researchers have found that adding small amounts of helium-3 to the mix could make it much more efficient, and thus a viable energy source much sooner that once thought.
Even if fusion is proven practical tomorrow, any kind of nuclear energy involves long waits for power plant construction measured in decades. However, mining helium-3 could be useful now, because of its non-energy applications. A major one is its ability to detect neutrons coming from plutonium that could be used in terrorist attacks. Here's how it works: a small amount of helium-3 is contained within a forensic instrument. When a neutron hits an atom of helium-3, the reaction produces tritium, a proton, and an electrical charge, alerting investigators to the possibility that plutonium is nearby.
Ironically, as global concern about a potential for hidden nuclear material increased in the early 2000s, so did the supply of helium-3 on Earth. That's because helium-3 comes from the decay of tritium, used in thermonuclear warheads (H-bombs). Thousands of such weapons have been dismantled from U.S. and Russian arsenals, making helium-3 available for plutonium detection, research, and other applications--including in the world of healthcare.
Helium-3 can help doctors diagnose lung diseases, since it enables imaging of the lungs in real time.
Helium-3 dramatically improves the ability of doctors to image the lungs in a range of diseases including asthma, chronic obstructive pulmonary disease and emphysema, cystic fibrosis, and bronchopulmonary dysplasia, which happens particularly in premature infants. Specifically, helium-3 is useful in magnetic resonance imaging (MRI), a procedure that creates images from within the body for diagnostic purposes.
But while a standard MRI allows doctors to visualize parts of the body like the heart or brain, it's useless for seeing the lungs. Because lungs are filled with air, which is much less dense than water or fat, effectively no signals are produced that would enable imaging.
To compensate for this problem, a patient can inhale gas that is hyperpolarized –meaning enhanced with special procedures so that the magnetic resonance signals from the lungs are finally readable. This gas is safe to breathe when mixed with enough oxygen to support life. Helium-3 is one such gas that can be hyperpolarized; since it produces such a strong signal, the MRI can literally see the air inside the lungs and in all of the airways, revealing intricate details of the bronchopulmonary tree. And it can do this in real time
The capability to show anatomic details of the lungs and airways, and the ability to display functional imaging as a patient breathes, makes helium-3 MRI far better than the standard method of testing lung function. Called spirometry, this method tells physicians how the lungs function overall, but does not home in on particular areas that may be causing a problem. Plus, spirometry requires patients to follow instructions and hold their breath, so it is not great for testing young children with pulmonary disease.
In recent years, the cost of helium-3 on Earth has skyrocketed.
Over the past several years, researchers have been developing MRI for lung testing using other hyperpolarized gases. The main alternative to helium-3 is xenon-129. Over the years, researchers have learned to overcome certain disadvantages of the latter, such as its potential to put patients to sleep. Since helium-3 provides the strongest signal, though, it is still the best gas for MRI studies in many lung conditions.
But the supply of helium-3 on Earth has been decreasing in recent years, due to the declining rate of dismantling of warheads, just as the Department of Homeland Security has required more and more of the gas for neutron detection. As a result, the cost of the gas has skyrocketed. Less is available now for medical uses – unless, of course, we begin mining it on the moon.
The question is: Are the benefits worth the 239,000-mile trip?
Should Organ Donors Be Paid?
A depiction of selling a human heart for cash.
Deanna Santana had assumed that people on organ transplant lists received matches. She didn't know some died while waiting. But in May 2011, after her 17-year-old son, Scott, was killed in a car accident, she learned what a precious gift organ and tissue donation can be.
"I would estimate it cost our family about $4,000 for me to donate a kidney to a stranger."
His heart, lungs, kidneys, liver and pancreas saved five people. His corneas enabled two others to see. And his bones, connective tissues and veins helped 73 individuals.
The donation's impact had a profound effect on his mother as well. In September 2016, she agreed to donate a kidney in a paired exchange of four people making the same sacrifice for four compatible strangers.
She gave up two weeks' worth of paid vacation to recuperate and covered lodging costs for loved ones during her transplant. Eventually, she qualified for state disability for part of her leave, but the compensation was less than her salary as public education and relations manager at Sierra Donor Services, an organ procurement organization in West Sacramento, California.
"I would estimate it cost our family about $4,000 for me to donate a kidney to a stranger," says Santana, 51. Despite the monetary hardship, she "would do it again in a heartbeat."
While some contend it's exploitative to entice organ donors and their families with compensation, others maintain they should be rewarded for extending their generosity while risking complications and recovering from donation surgery. But many agree on one point: The focus should be less on paying donors and more on removing financial barriers that may discourage interested prospects from doing a good deed.
"There's significant potential risk associated with donating a kidney, some of which we're continuing to learn," says transplant surgeon Matthew Cooper, a board member of the National Kidney Foundation and co-chair of its Transplant Task Force.
Although most kidneys are removed laparoscopically, reducing hospitalization and recuperation time, complications can occur. The risks include wound and urinary tract infections, pneumonia, blood clots, injury to local nerves causing decreased sensation in the hip or thigh, acute blood loss requiring transfusion and even death, Cooper says.
"We think that donation is a cost-neutral opportunity. It, in fact, is not."
Meanwhile, from a financial standpoint, estimates have found it costs a kidney donor in the United States an average of $3,000 to navigate the entire transplant process, which may include time off from work, travel to and from the hospital, accommodations, food and child care expenses.
"We think that donation is a cost-neutral opportunity. It, in fact, is not," says Cooper, who is also Director of Kidney and Pancreas Transplantation at MedStar Georgetown Transplant Institute in Washington, D.C.
The National Organ Transplant Act of 1984 makes it illegal to sell human organs but did not prohibit payment for the donation of human plasma, sperm and egg cells.
Unlike plasma, sperm and eggs cells—which are "renewable resources"—a kidney is irreplaceable, says John J. Friedewald, a nephrologist who is medical director of kidney transplantation at Northwestern Memorial Hospital in Chicago.
Offering some sort of incentives could lessen the overall burden on donors while benefiting many more potential recipients. "We can eliminate the people waiting on the list and dying, at least for kidneys," Friedewald says.
On the other hand, incentives may influence an individual to the point that the donation is made purely for monetary gain. "It's a delicate balance," he explains, "because so much of the transplant system has been built on altruism."
That's where doing away with the "disincentives" comes into the equation. Compensating donors for the costs they endure would be a reasonable compromise, Friedewald says.
Depending on the state, living donors may deduct up to $10,000 from their adjusted gross income under the Organ Donation Tax Deduction Act for the year in which the transplantation occurs. "Human organ" applies to all or part of a liver, pancreas, kidney, intestine, lung or bone marrow. The subtracted modification may be claimed for only unreimbursed travel and lodging expenses and lost wages.
For some or many donors, the tax credit doesn't go far enough in offsetting their losses, but they often take it in stride, says Chaya Lipschutz, a Brooklyn, N.Y.-based matchmaker for donors and recipients, who launched the website KidneyMitzvah.com in 2009.
Seeking compensation for lost wages "is extremely rare" in her experience. "In all the years of doing this," she recalls, "I only had two people who donated a kidney who needed to get paid for lost wages." She finds it "pretty amazing that mostly all who contact don't ask."
Lipschutz, an Orthodox Jew, has walked in a donor's shoes. In September 2005, at age 48, she donated a kidney to a stranger after coming across an ad in a weekly Jewish newspaper. The ad stated: "Please help save a Jewish life—New Jersey mother of two in dire need of kidney—Whoever saves one life from Israel it is as if they saved an entire nation."
To make matches, Lipschutz posts in various online groups in the United States and Israel. Donors in Israel may receive "refunds" for loss of earnings, travel expenses, psychological treatment, recovery leave, and insurance. They also qualify for visits to national parks and nature reserves without entrance fees, Lipschutz says.
"There has been an attempt to figure out what would constitute fair compensation without the appearance that people are selling their organs or their loved ones' organs."
Kidneys can be procured from healthy living donors or patients who have undergone circulatory or brain death.
"The real dilemma arises with payment for living donation, which would favor poorer individuals to donate who would not necessarily do so," says Dr. Cheryl L. Kunis, a New York-based nephrologist whose practice consists primarily of kidney transplant recipients. "In addition, such payment for living donation has not demonstrated to improve a donor's socioeconomic status globally."
Living kidney donation has the highest success rate. But organs from young and previously healthy individuals who die in accidents or from overdoses, especially in the opioid epidemic, often work just as well as kidneys from cadaveric donors who succumb to trauma, Kunis says.
In these tragic circumstances, she notes that the decision to donate is often left to an individual's grieving family members when a living will isn't available. A payment toward funeral expenses, for instance, could tip their decision in favor of organ donation.
A similar scenario presents when a patient with a beating heart is on the verge of dying, and the family is unsure about consenting to organ donation, says Jonathan D. Moreno, a professor in the department of medical ethics and health policy at the University of Pennsylvania.
"There has been an attempt to figure out what would constitute fair compensation," he says, "without the appearance that people are selling their organs or their loved ones' organs."
The overarching concern remains the same: Compensating organ donors could lead to exploitation of socioeconomically disadvantaged groups. "What's likely to finally resolve" this bioethics debate, Moreno foresees, "is patient-compatible organs grown in pigs as the basic science of xenotransplants (between species) seems to be progressing."
Cooper, the transplant surgeon at Georgetown, believes more potential donors would come forward if financial barriers weren't an issue. Of the ones who end up giving a part of themselves, with or without reimbursement, "the overwhelming majority look back upon it as an extremely positive experience," he says. After all, "they're lifesavers. They should be celebrated."