Walgreens Boots Alliance Inc. (NASDAQ:WBA) on Sunday announced the termination of its three year old partnership with the blood testing company, Theranos. This would be an additional blow to the embattled company which is under federal prosecutors’ scrutiny for several reasons. Walgreens announced to close all 40 of the Theranos Wellness Centers in Arizona.

Walgreens senior vice president and chief health care officer, Brad Fluegel explained the reason of termination saying, “In light of the voiding of a number of test results, and as the Centers for Medicare and Medicaid Services (CMS) has rejected Theranos’ plan of correction and considers sanctions, we have carefully considered our relationship with Theranos and believe it is in our customers’ best interests to terminate our partnership.”

Theranos spokesperson revealed the company’s disappointment over the announcement of termination and assures to remain committed to the mission. However, Theranos will continue its retail in Arizona and California. The company was once highly praised as it claimed to perform various medical tests on a drop of blood rather than drawing tubes of blood from an arm.

US Attorney and the SEC have examined Theranos business operations to determine whether the company has misled investors. Moreover, the company has also been accused of misconduct, that it mostly performed tests using conventional equipments, rather than the proprietary Edison device. This has resulted in penalty against the blood testing company’s CEO, Elizabeth Holmes.

The alliance between Walgreens and Theranos was announced in September 2013. By including lab tests to its offerings, Walgreens aimed to gain consumer traction but it appears that the drugstore operator did not vet Theranos technology.

Based on the current federal investigations, Forbes has also reduced Theranos’ worth from $9 billion to $800 million. Now that the company’s major revenue partner is extricated, further downgrades are expected to occur.