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Founders of medical science upstart uBiome once likened to Theranos now indicted for, you guessed it, fraud • The Register

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Jessica Richman, 46, and Zachary Apte, 36, co-founders of San Francisco-based medical testing startup uBiome, have been indicted on civil and criminal charges for allegedly bilking investors out of $60m.

The SEC, America’s financial watchdog, charged the entrepreneurs with misrepresenting uBiome’s success by falsely claiming that the company’s diagnostic tests for fecal and vaginal microbiome samples were widely accepted by health insurance companies. The truth was anything but.

“uBiome’s purported success in generating revenue, however, was a sham,” the SEC’s civil complaint [PDF] in the Northenr District of California says. “It depended on duping doctors into ordering unnecessary tests and other improper practices that Richman and Apte directed and which, once discovered, led insurers to claw back their previous reimbursement payments to uBiome.”

The duo, who are fugitives and have not yet been arrested, also face more than 40 criminal charges brought by the US Justice Department, including conspiracy to commit securities fraud and health care fraud, money laundering, and aggravated identity theft, among others.

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“The indictment alleges defendants bilked insurance providers with fraudulent reimbursement requests, a practice that inevitably would result in higher premiums for us all,” said Acting US Attorney Stephanie Hind in a statement. “Further, defendants cashed out on the investment that flowed into the company to benefit themselves.”

During the time it was operational, from its founding in 2012 until an FBI raid and bankruptcy in 2019, uBiome was likened to Theranos, a comparison that now seems even more apt with top execs at both companies – Elizabeth Holmes and Ramesh “Sunny” Balwani of Theranos; and Richman and Apte of uBiome – fighting federal fraud charges in court.

Initially, uBiome offered its “Gut Explorer” test directly to consumers, who would mail a fecal sample to a lab and get a report “as a way to get a better understanding of what was going on in one’s gut,” the DoJ complaint explains.

Initially priced at less than $100, the test wasn’t marketed as a diagnostic or medical tool. Rather, it was positioned as a way to help people understand more about the bacteria in their gut. According to the feds, Apte and Richman realized by 2014 that selling to the consumer market wouldn’t generate the revenue needed to keep the company going, so they determined their company should develop clinical tests for medical professionals, paid for by insurers.

By November, 2015, the company was submitting claims for its test, renamed “SmartGut,” which saw version 2.0 and 3.0 releases in 2017 and 2018. uBiome also developed a vaginal microbe test, called “SmartJane,” in late 2017. For its tests, the testing biz charged insurance companies around $2,970 each.

Apte and Richman, according to the Justice Department, devised and implemented various fraudulent practices to dupe healthcare providers and insurance companies into paying for tests that were not validated or medically necessary. They’re said to have falsified documents and concealed material facts from insurance providers to protect their fraudulent billing scheme.

The government’s legal filings offer no indication about whether either defendant yet has legal representation, though they note that Apte in June, 2019, deposited $2m to an Interest on Lawyer Trust Account (IOLTA) to fund future legal needs. ®

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SSD belonging to Euro-cloud Scaleway was stolen from back of a truck, then turned up on YouTube • The Register

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In brief Deepmind and the European Bioinformatics Institute released a database of more than 350,000 3D protein structures predicted by the biz’s AI model AlphaFold.

That data covers the 20,000 or so proteins made in the human body, and is available for anyone to study. The proteomes of 20 other organisms, from Zebrafish to E.coli bacteria, are also in there, too, and hundreds of millions of more structures will be added over time, we’re told.

“In the hands of scientists around the world, this new protein almanac will enable and accelerate research that will advance our understanding of these building blocks of life,” said DeepMind’s CEO Demis Hassabis. He hopes that it will be a valuable resource that will be used in the discovery of new drugs and our understanding of diseases.

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Reid Hoffman to join board of electric air-taxi start-up Joby

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Reid Hoffman. Image: ReidHoffman.org

LinkedIn co-founder Reid Hoffman is helping to take Joby, which is being billed as ‘Tesla meets Uber in the air’, public through a SPAC deal.

Electric air-taxi start-up Joby Aviation will add Silicon Valley figure Reid Hoffman to its board as the company prepares to go public via a merger with a blank-cheque firm.

LinkedIn co-founder Hoffman, who is now a partner at venture capital firm Greylock, has a key connection to the 12-year-old start-up. Earlier this year, it was announced that Joby is going public through a $6.6bn reverse merger deal with Reinvent Technology Partners, the special purpose acquisition company (SPAC) Hoffman set up with Zynga founder Mark Pincus and investor Michael Thompson.

The deal is expected to close in this summer. Joby is the first aerial vehicle start-up to go public via the SPAC route, and the deal will provide the company with $1.6bn in cash.

SPACs have been growing in popularity this year as they can provide a quicker way of bringing a company public rather than the traditional route of an initial public offering.

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Hoffman will be added by the Joby board once the deal is complete, alongside Google general counsel Halimah DeLaine Prado and former Southwest Airlines CFO Laura Wright.

Toyota Motor Corporation board member and operating officer James Kuffner and Zoox CEO Aicha Evans have already been added to the board in recent months.

“We are incredibly humbled to have been able to assemble such a remarkable and diverse group of world-class leaders to guide and support Joby as we plan to enter the public market,” said JoeBen Bevirt, Joby CEO and founder.

Joby acquired Uber’s Elevate flying car business at the end of December and now plans to begin a commercial passenger ‘air taxi’ service in 2024. Hoffman described the venture as “Tesla meets Uber in the air” in a recent interview.

The company will work with Toyota from its California-based manufacturing facility to build its electric vertical takeoff and landing (eVTOL) aircraft. Toyota led the company’s $620m Series C funding round last year, with other investors including Intel Capital and JetBlue Technology Ventures.

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Virtual contact worse than no contact for over-60s in lockdown, says study | Coronavirus

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Virtual contact during the pandemic made many over-60s feel lonelier and more depressed than no contact at all, new research has found.

Many older people stayed in touch with family and friends during lockdown using the phone, video calls, and other forms of virtual contact. Zoom choirs, online book clubs and virtual bedtime stories with grandchildren helped many stave off isolation.

But the study, among the first to comparatively assess social interactions across households and mental wellbeing during the pandemic, found many older people experienced a greater increase in loneliness and long-term mental health disorders as a result of the switch to online socialising than those who spent the pandemic on their own.

“We were surprised by the finding that an older person who had only virtual contact during lockdown experienced greater loneliness and negative mental health impacts than an older person who had no contact with other people at all,” said Dr Yang Hu of Lancaster University, who co-wrote the report, published on Monday in Frontiers in Sociology.

“We were expecting that a virtual contact was better than total isolation but that doesn’t seem to have been the case for older people,” he added.

The problem, said Hu, was that older people unfamiliar with technology found it stressful to learn how to use it. But even those who were familiar with technology often found the extensive use of the medium over lockdown so stressful that it was more damaging to their mental health than simply coping with isolation and loneliness.

“Extensive exposure to digital means of communication can also cause burnout. The results are very consistent,” said Hu, who collected data from 5,148 people aged 60 or over in the UK and 1,391 in the US – both before and during the pandemic.

“It’s not only loneliness that was made worse by virtual contact, but general mental health: these people were more depressed, more isolated and felt more unhappy as a direct result of their use of virtual contact,” he said.

The report, Covid-19, Inter-household Contact and Mental Wellbeing Among Older Adults in the US and the UK, analysed national data from the UK’s Economic and Social Research Council-funded Understanding Society Covid-19 survey and the US Health and Retirement Study.

Hu said more emphasis needed to be placed on safe ways to have face-to-face contact in future emergencies. There must also, he added, be a drive to bolster the digital capacity of the older age groups.

“We need to have disaster preparedness,” he said. “We need to equip older people with the digital capacity to be able to use technology for the next time a disaster like this comes around.”

The findings outlined the limitations of a digital-only future and the promise of a digitally enhanced future in response to population ageing in the longer term, added Hu.

“Policymakers and practitioners need to take measures to pre-empt and mitigate the potential unintended implications of household-centred pandemic responses for mental wellbeing,” he said.

Caroline Abrahams, charity director at Age UK, welcomed the report. “We know the virtual environment can exacerbate those feelings of not actually being there with loved ones in person,” she said.

“It’s essential therefore that government makes preventing and tackling loneliness a top policy priority, backed up with adequate funding.

“It’s not over the top to point out that in the worst cases, loneliness can kill in the sense that it undermines resilience to health threats of many kinds, as well as leading to older people in the twilight of their lives losing all hope, so they lack a reason to carry on.”

Patrick Vernon, associate director at the Centre for Ageing Better, said he saw many examples of older people using technology to stay connected in “really positive ways”.

But he was also doubtful: “We know that even for those who are online, lack of skills and confidence can prevent people from using the internet in the ways that they’d like to.”

Previous research by the Centre for Ageing Better found that since the pandemic, there had been significant increases in the use of digital technology among those aged 50-70 years who were already online.

But there are still 3 million people across the UK who are offline, with a significant digital divide affecting low-income households. Twenty-seven per cent of people aged 50-70 with an annual household income under £25,000 were offline before the pandemic.

Vernon said: “Our research has found that some people who were offline found it difficult to connect with family, friends and neighbours during the pandemic – and even those who were online said technology didn’t compensate for missing out on physical social interactions.”

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