Pioneering US genetic testing company 23andMe has filed for bankruptcy and is actively seeking a buyer, two years after hackers gained unauthorized access to millions of user profiles.
23andMe, known for its mail-in saliva tests that determine ancestry or specific health-related genetic traits for under $200, announced late Sunday that it had “filed a voluntary petition for reorganization” with a state bankruptcy court in Missouri.
The announcement has prompted warnings for 23andMe customers to request the deletion of their data, amid growing privacy concerns. At its peak several years ago, the DNA testing trend saw millions of consumers eager to uncover their ancestral roots and health information, with 23andMe tests becoming popular gift items.
The Silicon Valley-based company, which went public in 2021, claims 15 million customers but has experienced declining sales in recent months as the testing craze waned and the company suffered a significant data breach. 23andMe disclosed that it rejected a takeover offer from its co-founder and CEO Anne Wojcicki, who has resigned from her position but will remain on the company’s board of directors, according to the official statement.
In a post on X, Wojcicki stated, “While I am disappointed that we have come to this conclusion and my bid was rejected, I am supportive of the company and I intend to be a bidder.”
She explained that her resignation as CEO was a strategic move to “be in the best position to pursue the company as an independent bidder.” Wojcicki, who co-founded 23andMe 19 years ago, acknowledged the company’s challenges but emphasized her “unwavering” belief in its future. Faced with these difficulties, 23andMe announced the layoff of 40 percent of its staff, approximately 200 people, in November.
The company also suspended its research programs.
In a regulatory filing, 23andMe also disclosed that it has agreed to pay approximately $37.5 million to settle claims related to the 2023 data breach.
The 2023 hacking incident affected 6.9 million accounts, with 5.5 million containing sensitive genetic matching information.
Using compromised customer passwords, the hackers accessed data including names, genders, birth years, locations, photos, health information, and genetic ancestry results.
