23andMe files for bankruptcy as DNA testing demand plummets

Genetic testing company 23andMe has filed for Chapter 11 bankruptcy protection in the United States, citing a decline in demand for DNA testing kits and reputational damage from a 2023 data breach.

The company, once valued at nearly $6 billion in 2021, has seen its market capitalization fall below $50 million.

The firm, known for its ancestry and genetic health testing services, struggled to sustain consumer interest in recent years. Competing with AncestryDNA and other players in the direct-to-consumer DNA testing market, 23andMe has faced financial difficulties exacerbated by the cyberattack that compromised customer data.

Co-founder and CEO Anne Wojcicki has stepped down but will remain on the company's board, while Chief Financial and Accounting Officer Joe Selsavage takes over as interim CEO. Despite previous buyout attempts, Wojcicki has expressed interest in making another bid to acquire and privatize 23andMe.

To maintain operations during bankruptcy proceedings, 23andMe secured up to $35 million in debtor-in-possession financing. The company plans to sell its assets through a court-supervised process while assuring customers that their genetic data privacy remains a priority. However, privacy concerns persist, with officials advising users to consider deleting their personal data.

This bankruptcy marks a significant downfall for 23andMe, once a leader in the consumer DNA testing industry. The company's struggles highlight the challenges of sustaining demand in the genetic testing market, raising questions about the future of personalized health and ancestry services.