A nonprofit organization, led by Anne Wojcicki, the co-founder and former CEO of 23andMe, has successfully won a bid to acquire the genetic testing company after its bankruptcy filing in March. The California-based nonprofit, TTAM Research Institute, is set to purchase 23andMe for an impressive $305 million, as detailed in a recent news release.
This acquisition marks the conclusion of a competitive bidding war between TTAM and Regeneron Pharmaceuticals, which had previously announced its intention to acquire a majority of 23andMe's assets for $256 million on May 19. In a statement to CNN, Regeneron explained that they chose not to submit a higher bid based on their evaluation of 23andMe's remaining value.
Anne Wojcicki stepped down from her role at 23andMe on March 24, coinciding with the company's Chapter 11 bankruptcy filing. The company's difficulties became particularly evident in September 2024 when all seven independent directors resigned en masse, expressing dissatisfaction with Wojcicki's strategic direction and attempts to transition the company to a private entity.
In November 2024, 23andMe made the difficult decision to cut approximately 40% of its workforce, equating to around 200 employees, and halted the development of its therapies as part of a broader restructuring initiative. Once valued at $6 billion, 23andMe had amassed genetic data from 15 million customers through its at-home DNA testing kits, which utilized saliva samples to provide personalized genetic insights, including potential health risks.
Despite its innovative offerings, 23andMe faced challenges in converting one-time buyers into loyal subscribers. The company's bankruptcy filing raised significant concerns regarding data privacy, prompting fears that customer genetic information might be sold to third parties. In response to these concerns, 27 states and the District of Columbia filed a lawsuit against 23andMe to prevent the sale of genetic data without explicit customer consent.
Experts, including Gideon Nave, an associate professor of marketing at the University of Pennsylvania's Wharton School, have highlighted the potential implications of genetic data. Companies could leverage this data for product personalization or targeted advertising, with genetics even linked to preferences in food. While the Genetic Information Nondiscrimination Act provides some protections against genetic discrimination in health insurance and employment, there are still limited restrictions concerning how genetic information can be utilized.
According to the news release, TTAM has committed to upholding 23andMe's privacy policies and honoring existing customer data rights, including options for account deletion and opting out of research initiatives. Wojcicki expressed her enthusiasm for the acquisition, stating, “I am thrilled that TTAM Research Institute will be able to continue the mission of 23andMe to help people access, understand, and benefit from the human genome.”
She emphasized the importance of empowering individuals with choices and transparency regarding their genetic data, allowing them to continue exploring their ancestry and health risks as they choose.
TTAM will acquire “substantially all” of 23andMe's assets, which include its personal genome service, research services, and Lemonaid Health, a telehealth program that was integrated into the company in 2021. However, this significant deal is still pending approval from the US Bankruptcy Court for the Eastern District of Missouri, with a hearing scheduled for June 17.
This acquisition represents a pivotal moment for 23andMe as it seeks to navigate its financial challenges while continuing to provide valuable genetic insights to consumers.
