The drug chain also said that it is suspending Theranos Inc. laboratory testing at its Palo Alto, Calif., store in the aftermath of a report by the Centers for Medicare & Medicaid Services that the lab violated several clinical standards.
CMS is one of two federal regulators overseeing the Theranos laboratory operations. The agency outlined five deficiencies, including one that it said posed “immediate jeopardy to patient health and safety” involving Theranos’s hematology testing for blood cell counts or the monitoring of patients’ blood.
Theranos, which said it was addressing the problems, said “a full plan of correction” will be submitted to CMS.
In its statement, Walgreens said it would wait to see what action the agency took before making any further decisions. “No patient samples will be sent to the Newark lab until all issues raised by CMS have been fully resolved,” it said.
Theranos was founded in 2003 by Elizabeth Holmes, a Stanford University dropout who promised to upend the traditional laboratory testing industry with a proprietary technology. She attracted widespread attention, and her company garnered a $9 billion valuation before questions surfaced over the company’s operations.
Walgreens informed Theranos that tests collected at 40 Theranos Wellness Centers in stores in Arizona must be sent only to Theranos’ certified lab in the Phoenix area or to an accredited third-party lab for analysis.
Theranos contends that more than 90% of its laboratory analysis is done in Arizona, where it worked with Walgreens, that it remained “open for business” and that it would continue testing at its Arizona lab. “This is an issue that many other labs have faced, and we will fix it quickly and completely, working with our regulators as we always do,” said Brooke Buchanan, a spokeswoman for Theranos.