Struggling DNA testing firm 23andMe to be bought for $256m

The DNA testing agency 23andMe says it has entered into an settlement to be acquired by Regeneron Prescription drugs for $256m (£192m).

It comes two months after the corporate filed for chapter safety within the US.

23andMe stated Regeneron had dedicated to adjust to its privateness insurance policies as a part of the deal, and that Regeneron has safety controls in place to guard consumer knowledge.

Final month, the agency agreed to have an ombudsman oversee the safety of consumer knowledge in response to calls for by a number of state attorneys basic within the US.

The officers expressed concern over the potential for unscrupulous patrons to wield the information in opposition to shoppers.

Regeneron will purchase practically all of 23andMe’s belongings, the company said in a statement.

Its subsidiary Lemonaid Well being shall be wound down underneath the settlement.

23andMe will proceed to function as a wholly-owned unit unit of Regeneron, which stated it will use the agency’s knowledge for drug improvement.

“We’re happy to have reached a transaction that maximizes the worth of the enterprise and allows the mission of 23andMe to stay on, whereas sustaining important protections round buyer privateness, selection and consent with respect to their genetic knowledge,” stated 23andMe’s board chairman Mark Jensen.

The deal was made via public sale final week as a part of the corporate’s chapter proceedings.

The corporate declined to remark additional when approached by the BBC.

Regeneron has completely different goals from those 23andMe offered to shoppers, in line with Dr Jennifer King, privateness and knowledge coverage Fellow on the Stanford Institute for Human-Centered Synthetic Intelligence.

Dr. King, who has interviewed a number of 23andMe customers for her analysis, stated the corporate “all the time led with the non-profit ‘we’re serving to humanity’ facet which helped obscure its for-profit mission”.

However she added a profit-driven mission was prone to be clearer to clients now that it “is within the sole management of an organization that’s doing genetic analysis for pharmaceutical improvement”.

23andMe was co-founded in 2006 by Anne Wojcicki who served as CEO till stepping down in March.

Over time, the corporate acquired high-profile endorsements from celebrities together with Oprah Winfrey, Eva Longoria and Snoop Dogg.

23andMe went public in 2021, which noticed its worth high $6bn – nevertheless it by no means turned a revenue.

The once-celebrated firm has struggled amid weak demand for its testing kits and by no means managed to redefine its enterprise mannequin.

A subscription service failed to achieve traction with clients and efforts to make use of its huge trove of knowledge to maneuver into drug improvement additionally faltered.

Then in 2023 the corporate skilled an information breach that uncovered the genetic knowledge of tens of millions of customers.

The agency finally settled a lawsuit alleging it failed to guard the privateness of practically seven million clients whose private info was uncovered.

Hackers gained entry to household timber, start years and geographic areas, through the use of clients’ outdated passwords, however the firm maintains the information stolen didn’t embrace DNA data.

Two months after the settlement, it slashed 200 jobs – about 40% of its workforce.

Ms Wojcicki tried to take the corporate personal however was not open to a third-party takeover.

When 23andMe filed for chapter safety in March, attorneys basic from a number of US states suggested its clients to purge their info from the agency’s database.

On the time, the corporate stated it will proceed to guard buyer knowledge as specified by its privateness coverage, and any purchaser of the corporate must abide by legal guidelines that apply to how buyer knowledge is handled.

However its privateness coverage additionally included language which allowed for private info to be accessed, offered, or transferred if it was “concerned in a chapter, merger, acquisition, reorganization, or sale of belongings”.

23andMe agreed to a court-appointed overseer of buyer genetic knowledge after a number of states alleged the corporate was failing to take knowledge safety severely sufficient.