Theranos 2.0: The fingertip blood test that may actually work — this time

David Stein tells a familiar story. His start-up has invented a device that, with blood from a single finger prick, can run dozens of blood tests and free millions of people from their terror of needles. The $50 billion medical diagnostics business, and, by extension, healthcare itself, is set to be revolutionised.

Heard this one before? This was the narrative, of course, spun by Elizabeth Holmes, the Silicon Valley star turned convict. She was jailed this year after a court found that she had lied to investors about the blood-testing device invented by her start-up, Theranos.

Holmes’s downfall turned into one of the most salacious business stories of the century, spawning films, books and podcasts. While the drama unfolded, Stein, an engineering PhD who previously ran an arm of Siemens’ medical diagnostics business, was quietly beavering away on his own version of a device to simplify blood testing.

Holmes, who was known for her blonde hair, black turtlenecks and baritone voice, started a nine-year prison term in May. Stein, a jovial, barrel-chested father of three with a salt-and-pepper goatee, could not be more different. Nor could his start-up, Babson Diagnostics. Unlike Theranos, Babson is mostly unknown, but crucially, it may be close to delivering what Holmes never could.

The company has developed a device that clamps onto the fingertip. It fills a pea-sized container with blood which is fed into a machine that carries out the most common tests for wellness exams, chronic condition management, and screenings, but on a fraction of the sample required now.

Typically, a blood draw extracts two ten-millilitre vials, but, for many people, having a needle stuck in a vein is so traumatic that they delay or avoid tests.

“Seventy per cent of medical decisions are informed by blood testing; 50 per cent of a patient’s medical record is blood results. It’s the most utilised medical intervention, yet 40 per cent of people report skipping,” Stein said. “For millions of years we’ve evolved to say, ‘Don’t put shiny things into soft parts of my body.’ We want to take away the fear.”

The company has run more than 700,000 tests on 3,000 people across 40 clinical studies monitored by Institutional Review Boards, professionals who oversee and approve research involving human patients. It has built a certified lab in Texas and is awaiting clearance from the US Food and Drug Administration to launch the first significant advance in decades in how blood is tested clinically.

The ease of the system means blood draws could be done at pharmacies, rather than doctors’ offices or labs. “Theranos got it really right when it comes to the customer. People wanted a true alternative,” Stein said. “They failed in their integrity, their technology.”

Getting this far has not been easy. Stein and Eric Olson, a former executive in Siemens’ labs business, began working on the idea inside the German conglomerate in 2014, just as the Theranos hype was cresting. The Silicon Valley start-up had signed deals with the likes of Walgreens to put its system inside stores. Investors lapped up the story, pouring in hundreds of millions and valuing the company at $10 billion.

By 2016, however, the wheels were falling off amid a string of stories from The Wall Street Journal questioning Theranos’s technology. Olson left Siemens in 2017 to set up Babson. Stein joined not long after. Siemens injected its intellectual property and Becton Dickinson, the medical device giant, signed up as a strategic partner.

After seven years and more than $50 million, Babson is near achieving what Theranos only dreamt of. “I purposely stayed away [from the hype],” Stein said. “We didn’t want to ... [make] a whole bunch of claims that we can’t back up using our science first.”

A former corporate executive quietly working on a product spun out of a big company doesn’t quite have the same allure as a platinum-haired wunderkind promising to change the world. The more boring story, however, may have a better ending.