Elizabeth Holmes intentionally hid the use of third-party testing devices from Walgreens, its biggest partner, in order to protect "trade secrets," the former Theranos CEO testified in her third day on the stand for her ongoing fraud trial in San Jose.
She said that Theranos made modifications to use its tech with a blood testing device from Siemens, which could run a hundred patient samples and perform "dozens" of tests, claiming it was an "open source" device that could work with Theranos' "own proprietary chemistry." But the company hid this fact from Walgreens and others, worried that big medical device companies "could easily reproduce what we've done," she said. The company filed a non-public patent application for these devices.
The FDA, however, was made aware of the devices, a decision Holmes said was because the agency could ensure "trade secret protection."
"This was an invention that we understood as a counsel we'd have to protect as a trade secret," she testified.
The company decided against using its own proprietary devices because they couldn't handle "huge numbers of samples coming in at the same time," she said. Theranos said its own devices were meant to be used on-site, rather than in the central lab model it ultimately used for Walgreens testing.