Ramesh Balwani, Ex-President of US based health technology company Theranos, has been sentenced to 13 years in federal prison for fraud, announced by United States Attorney Stephanie Hinds, on Wednesday.
Balwani, of Fremont, was sentenced at California to 12 years and 11months in federal prisons for fraud that risked patient health by misrepresenting the accuracy of Theranos blood analysis technology and that defrauded company’s investors of millions of dollars.
In a video statement U.S. Attorney Stephanie Hinds said, “Patient health is the highest priority of our healthcare system, and Silicon Valley has long been home to healthcare start-ups that enhance the care of patients through technological developments.”
“Ramesh Balwani, in a desire to become a Silicon Valley titan, valued business success and personal wealth far more than patient safety. He chose deceit over candor with patients in need of medical care, and he treated his investors no better,” Hinds added.
FBI Special Agent in Charge Robert Tripp said Balwani not only deliberately concealed defects in Theranos’ blood-testing technology to mislead investors, he knowingly put patients’ health at risk.
“Today’s sentence reflects years of dedication by the FBI and our partners to investigate fraud within Theranos and bring the company’s leadership to justice,” Tripp added.
Balwani, 57, of Fremont, Calif., was employed from September 2009 through July 2016 at Theranos, Inc. Over time he held the positions of board member, chief operating officer and president. Balwani and Holmes asserted that the Theranos proprietary analyzer produced results that were cheaper, more reliable and less variable than existing methods, and obtained results at a speed faster than ever before possible.
Balwani and Holmes asserted to investors that the Theranos technology had been comprehensively validated by multiple major pharmaceutical companies and was being used by the Department of Defence to treat wounded soldiers where, it was represented, it “actually saved lives in the battlefield.”
Trial evidence demonstrated that Balwani and Holmes continued to tout Theranos’ analyzer as a revolution in healthcare while misrepresenting the dire financial status of Theranos.