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Theranos CEO Elizabeth Holmes banned from running labs for two years

The US Centers for Medicare & Medicaid Services has also revoked the license for Theranos' lab in California.

Theranos founder and CEO Elizabeth Holmes.

JP Yim, Getty Images

After months under the microscope, Theranos' CEO Elizabeth Holmes has been banned from operating a laboratory for two years, and the health-tech company's Newark, California laboratory has had its license revoked.

The ruling was made by the federal Centers for Medicare & Medicaid Services, and was announced by Theranos on Thursday.

"We accept full responsibility for the issues at our laboratory in Newark, California, and have already worked to undertake comprehensive remedial actions," Holmes said. "Those actions include shutting down and subsequently rebuilding the Newark lab from the ground up, rebuilding quality systems, adding highly experienced leadership, personnel and experts, and implementing enhanced quality and training procedures."

Theranos was once a promising company that set out to innovate blood testing. Two years ago, it was valued at $9 billion. But it has faced increased scrutiny, along with civil and criminal investigations, since a Wall Street Journal report in October suggested Theranos' blood-testing devices were flawed. In June, it lost its partnership with US drug giant Walgreens.