Forbes revises estimate of Theranos founder Elizabeth Holmes’ wealth from US$4.5billion to US$0

Forbes magazine on Wednesday reduced its estimate of the net worth of Elizabeth Holmes, the founder and chief executive of health technology company Theranos Inc, to zero from US$4.5 billion last year.

Holmes’ blood-testing company has been under investigation by several federal and state agencies and was accused in a suit filed last week of endangering customer health through “massive failures” that misrepresented the accuracy and quality of its blood tests, according to court papers.

Forbes said private investors had bought stakes in Theranos that implied a US$9 billion valuation but said US$800 million is a more realistic figure.

“At such a low valuation, Holmes’ stake is essentially worth nothing,” the business publication said.

Theranos spokeswoman Brooke Buchanan responded to the report saying, “As a privately held company, we declined to share confidential financial information with Forbes. As a result, the article was based exclusively on speculation and press reports.”

In 2015 Forbes had named Holmes the richest self-made woman in America. Explaining why it reduced its estimate of Holmes’ wealth for the same list this year, Forbes said her fortune was based entirely on her 50 per cent stake in Theranos, a stake that has suffered in value amid questions over the company’s diagnostic capabilities.