Genetic testing company 23andMe has filed for Chapter 11 bankruptcy protection in a Missouri federal court, prompting questions about the future of the DNA data it has collected from customers. Once valued at over $6 billion, the company saw a significant decline in its market capitalization, which currently stands at around $25 million, following challenges in generating recurring revenue after its public listing in 2021.
The bankruptcy filing is stated to have no immediate effect on how 23andMe stores or manages customer data. However, concerns have been raised regarding the potential sale of DNA profiles, as the company is not classified as a healthcare provider, potentially limiting the protections typically afforded to health information. A report from the Harvard Gazette highlighted these risks, noting that while certain laws may not apply, bankruptcy proceedings could involve a consumer privacy ombudsperson to ensure adherence to privacy policies during any asset sales.
Anne Wojcicki, co-founder and CEO of 23andMe, announced her resignation as CEO but indicated her intent to bid for the company's assets during the restructuring process. In her statement on social media, she expressed her commitment to the company's vision of integrating genetics into healthcare.
The bankruptcy filing includes plans to solicit bids for company assets over a 45-day period, with estimates placing the company's assets and liabilities in the range of $100 million to $500 million. The situation follows a recent history marked by a significant data breach affecting millions of users, raising further questions about data security and customer privacy amid the company's financial troubles.