Investors put hundreds of millions in Theranos despite its lack of published science.

Few tech companies have crashed and burned in recent years like Theranos, a blood-testing startup that claimed it would revolutionize healthcare by doing away with “big bad needles.”  In the case of Theranos, launched over a decade ago by Stanford drop-out Elizabeth Holmes, investors put hundreds of millions in a concept with little-to-no published science to support it. When it was gradually revealed that the advanced technology required for such an idea did not yet exist, the company – and Holmes, who’d amassed a net worth of $4.5 billion after the company was valued at $9 billion – toppled.

In a new study published Monday in the European Journal of Clinical Investigation, Ioannidis and his coauthors reveal that dozens of other healthcare startups valued at more than $1 billion (also known as unicorns) have published little or no research in peer-reviewed literature.

That’s especially true when a startup’s technology puts people’s lives at risk, as is often the case in healthcare.  Hope and hype cannot supplant data. Last year, healthcare startups raised $20.3 billion from venture investors, according to a recent PwC and CB Insights report. That’s the highest amount in history. Of all them, half published no highly-cited papers; a quarter published nothing at all. Eighteen companies published six papers or fewer.

Instead of peer-reviewed research, these highly-valued startups rely on: “stealth research,” or internal studies free from expert scrutiny and at risk of hype. Stealth research manifests in “a confusing mix of possibly brilliant ideas, aggressive corporate announcements, and mass media hype,” he wrote.

One of the companies is Intarcia Therapeutics, a Gates Foundation-backed startup working on implantable devices for diabetes management and HIV prevention. Founded more than two decades ago, the startup has published only six peer-reviewed papers in the peer-reviewed literature, Ioannidis and his team found. Of those papers, none were high-impact. Yet the company has raised $1.4 billion and was last valued at $4 billion.

Moderna Therapeutics, a startup founded in 2010 that aims to develop RNA-based therapies for cancer and infectious diseases, broke records with its sky-high initial public offering. Although the company’s stock has declined since its IPO, it is currently valued at roughly $5 billion.  Moderna has only published one high-impact study, however, according to the analysis. Still, the authors found that the company had published 16 other peer-reviewed studies – just none that were highly cited by other researchers. Buzzy unicorn healthcare startups with no high-quality research.

One of those startups is Oscar Health, the buzzy health insurance startup that recently scored $375 million from Google’s parent company, Alphabet. Before the Alphabet announcement, the company was last reported to be valued at $3.2 billion. Oscar’s website claims it saves patients money and time, but the company hasn’t published any peer-reviewed studies backing up those claims. Cofounded in 2012 by Josh Kushner, whose brother Jared is a senior adviser to President Donald Trump, the company launched on the Affordable Care Act’s insurance exchanges. In contrast to Oscar, established health insurers like Kaiser and Cigna have published peer-reviewed articles to evaluate some of the claims they make and to inform the work of their clinicians.

Outcome Health, a startup that aimed to outfit doctor’s offices with educational materials and pharmaceutical ads and was once valued at $5.5 billion, also failed to publish a single peer-reviewed paper, according to Ioannidis. After facing a recent lawsuit and undergoing an internal investigation, the company is now struggling to survive.

With Covid19, the situation has just gotten worse!

“Startups are key purveyors of innovation: Holding them to a minimum standard of evaluation is essential,”