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Pharma Startup President Convicted in Fake Covid Testing Scheme


A laboratory technician places human blood samples on an automated testing line at the Maccabi Health Services HMO central laboratory January 22, 2006 in Nes Tsiona which is located in central Israel.

A laboratory technician places human blood samples on an automated testing line at the Maccabi Health Services HMO central laboratory January 22, 2006 in Nes Tsiona which is located in central Israel.
Photo: David Silverman (Getty Images)

Blood testing huckster and former Arrayit president Mark Schena has been convicted in acovid-19 and allergy test scheme that allegedly resulted in nearly $80 million worth of fraudulent claims. Schena, who was convicted on five separate charges, could potentially spend decades in prison, according to the Department of Justice.

The DOJ alleges Schena misled investors with bogus claims of “revolutionary” new technology capable of testing for virtually any disease with just a couple of pinpricks of blood while president of his pharma startup. No, this isn’t Theranos but yes, it sure does sound similar.

Schena allegedly misled investors and told them his company was valued at around $4.5 billion. In reality, the DOJ alleges the president withheld documents that revealed Arrayit was actually on the verge of bankruptcy. Arrayit allegedly released fabricated press releases and tweets falsely claiming major institutions had entered into partnerships with the company. Schena even boldly claimed he was on a “shortlist” for the Nobel Prize, a claim that also turned out to be bullshit.

Arrayit did not immediately respond to Gizmodo’s request for comment.

Prosecutors set their sights on Schena in 2020 when he allegedly tried to pass off his supposed allergy testing techniques as acovid-19 test during the height of the pandemic. A criminal complaint filed with the US District Court of the Northern District of California claims Schena would email potential clients, telling them his company had developed a test based on, “advanced Silicon Valley technology and finger stick blood collection.” Schena allegedly tricked patients into believing prominent health officials, including National Institute of Allergy and Infectious Disease Director Anthony Fauci, had mandated covid-19 testing and allergy testing. Using that misinformation Schena would allegedly convince patients who were trying to get their hands on acovid-19 test amid a national testing shortage to also pay up for additional allergy testing.

The DOJ claims Arrayit billed more per patient to Medicare for blood testing than all other US laboratories. All told, Arrayit allegedly filed $77 million worth of false and fraudulent claims for its covid-19 and allergy testing service. Schena, who was convicted of one count of conspiracy to commit health care fraud and conspiracy to commit wire fraud, two counts of health care fraud, one count of conspiracy to pay kickbacks, two counts of payment of kickbacks, and three counts of securities fraud , could potentially face decades in prison.

Beware of the prick

Schena’s conviction comes just months after Theranos founder Elizabeth Holmes was found guilty of defrauding investors over her company’s similarly bogus finger-pricking blood test device. Holmes claimed her device, called the Edison, could test for a variety of things using only a single drop of blood. The pitch, like Schena’s, was elegant in its simplicity. It was also a lie. Holmes now faces up to 20 years in prison.



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