US DNA testing firm 23andMe files for bankruptcy protection after CEO's failed takeovers

The well-known DNA testing company 23andMe has filed for bankruptcy protection and applied to the U.S. Bankruptcy Court to sell its assets after multiple unsuccessful acquisition attempts by its CEO. This move signals the severe financial difficulties facing the once-popular genetic testing firm.

Chief Financial Officer Joe Selsavage will replace co-founder Anne Wojcicki as interim CEO. Wojcicki announced her resignation after several failed attempts to acquire the publicly traded company. This personnel change also reflects a significant adjustment in the company's strategic direction.

The California-based company stated in a release that it plans to continue operating as usual during the asset sale process and that there will be no changes to how it stores, manages, or protects customer data. The company emphasized its continued commitment to protecting customer data and maintaining transparency in user data management, underscoring that data privacy will be an important consideration in any potential transaction.

23andMe Chairman Mark Jensen stated: "We are committed to continuing to protect customer data and maintaining transparency in user data management, and data privacy will be an important consideration in any potential transaction."

California Attorney General Rob Bonta issued a consumer alert on Friday, advising customers to delete their genetic data from the 23andMe website, noting that the company's financial difficulties are an ongoing concern. Mr. Bonta emphasized that California has robust privacy laws that allow consumers to control and request companies to delete their genetic data.

Mr. Bonta stated: "Given 23andMe’s reported financial difficulties, I urge California residents to consider exercising their rights to instruct 23andMe to delete their data and destroy any genetic material samples held by the company."

Customers have the option to delete their accounts, but the company can retain their genetic data for up to three years. Furthermore, in 2018, pharmaceutical company GlaxoSmithKline paid $300 million (AU$476 million) for access to the test results of 5 million 23andMe customers for the design of new drugs. To date, 23andMe has established 15 partnerships with different pharmaceutical companies.

Founded in 2006, 23andMe was the first company to allow customers to learn more about their ancestry by using a saliva-based home DNA testing kit. Last November, the company laid off approximately 40% of its workforce (about 200 employees) and discontinued its therapeutic programs. These actions reflect the difficult choices the company has made in the face of financial pressures.