Genetic testing big 23andMe has filed for chapter safety within the US because it seeks to unload its enterprise — putting the private genetic knowledge of hundreds of thousands of shoppers in a precarious place.
The San Francisco-based firm, which rose to prominence with its client DNA testing kits, introduced on Sunday that it had initiated voluntary Chapter 11 proceedings in Missouri to “facilitate a sale process to maximise the value of its business.”
The dramatic improvement follows a catastrophic knowledge breach in 2023 that compromised the private data of practically 7 million prospects — nearly half of its world consumer base. With buyer belief plummeting and revenues collapsing, the corporate has reduce 40 per cent of its workforce, halted all therapeutic improvement, and now faces an unsure future.
So as to add to the turmoil, co-founder and chief govt Anne Wojcicki has stepped down to be able to mount a non-public bid for the corporate — considered one of a number of she has unsuccessfully proposed in current months. She stays on the board however has handed day-to-day management to CFO Joe Selsavage.
Wojcicki’s newest supply, valuing the agency at simply $11 million, represents a dramatic fall from grace for an organization as soon as valued at $5.8 billion on the peak of its Nasdaq debut in 2021. Her bid of $0.41 per share — an 84 per cent drop from an earlier proposal — was rejected by the board, prompting her non-public fairness associate to withdraw from the method.
The corporate has secured $35 million in debtor-in-possession financing from JMB Capital Companions to keep up operations in the course of the sale, and insists it’s “business as usual” for now. “There are no changes to the way the company stores, manages, or protects customer data,” 23andMe stated.
However considerations about genetic privateness are escalating. California’s lawyer common, Rob Bonta, issued a public warning over the weekend urging 23andMe prospects to request deletion of their DNA knowledge and destruction of organic samples. The corporate is already paying $30 million and providing three years of identification safety following a class-action lawsuit over the breach.
Chairman Mark Jensen stated a court-supervised sale was now the one viable route. “Data privacy will be an important consideration in any potential transaction,” he famous.
Wojcicki, who co-founded 23andMe in 2006, had lengthy harboured ambitions to evolve the corporate right into a drug developer by leveraging its huge genetic database. That technique is now on ice, with all therapeutic initiatives shelved since November.
Writing on X (previously Twitter), she expressed her disappointment: “If I am fortunate enough to secure the company’s assets through the restructuring process, I remain committed to our long-term vision of being a global leader in genetics.”
However critics say the collapse of 23andMe is a stark warning concerning the dangers of commercialising delicate well being knowledge with out ample safeguards. As one of many first direct-to-consumer genomics corporations, its downfall raises questions not solely about enterprise fashions in biotech but additionally about client belief within the dealing with of deeply private knowledge.
With 15 million DNA profiles in its archives and possession probably altering arms, privateness campaigners and prospects alike are watching intently — and calling for stronger protections round how genetic knowledge may be offered, saved or shared in future.
