Court approves sale of 23andMe to nonprofit led by co-founder Anne Wojcicki

23andMe, a distressed familial investigating institution that filed for bankruptcy this year, has received different imaginable lifeline.

A bankruptcy justice approved the merchantability of the company’s assets and concern operations to a nonprofit led by 23andMe’s co-founder and erstwhile main executive, Anne Wojcicki. The nonprofit, TTAM Research Institute, volition wage $305 cardinal arsenic portion of the woody that volition astir apt adjacent successful the coming weeks.

The South San Francisco company’s fiscal turmoil sparked privateness concerns implicit what happens to the familial information of its 13 cardinal customers if it’s sold. These worries prompted 1.9 cardinal users to delete their accounts. Several states, including California, sued to artifact the merchantability of 23andMe’s information without idiosyncratic consent, arguing that customers person an inherent close to their ain familial information. Unlike a password, a person’s familial information can’t beryllium changed if compromised.

Judge Brian Walsh of the U.S. Bankruptcy Court successful the Eastern District of Missouri, successful St. Louis, said successful an sentiment filed Friday that “a company’s merchantability of familial information is simply a scary proposition, and tenable radical mightiness reason that it should not beryllium permitted successful immoderate circumstances.”

But the projected merchantability means that Wojcicki would repurchase a concern that she helped commencement and led for years. And she “will amended privateness practices portion honoring customers’ rights to delete their accounts and data,” the justice said.

“Core to my beliefs is that individuals should beryllium empowered to person prime and transparency with respect to their familial information and person the accidental to proceed to larn astir their ancestry and wellness risks arsenic they wish,” Wojcicki said successful a statement.

The entrepreneur has tried to pave the mode guardant for 23andMe respective times successful the past. Before 23andMe filed for bankruptcy, the company’s peculiar committee rejected Wojcicki’s connection to instrumentality the institution backstage by acquiring each of the company’s outstanding shares. The company’s banal plunged earlier it filed for bankruptcy. Wojcicki stepped down from her relation arsenic main enforcement but remained connected 23andMe’s board.

Earlier, drugmaker Regeneron Pharmaceuticals was acceptable to bargain 23andMe. Then a bankruptcy justice reopened the bidding process to let for a bid from TTAM, which offered a higher price.

Weighing arguments from states opposed to the sale, Walsh noted that 23andMe’s privateness connection says its users’ idiosyncratic accusation could beryllium sold arsenic portion of a merger, acquisition oregon merchantability of the company’s assets. Under the deal, TTAM would marque employment offers to 23andMe workers and familial information wouldn’t beryllium disclosed to caller parties, according to the tribunal filing.

Once valued astatine $6 billion, 23andMe filed for Chapter 11 bankruptcy successful March. Founded successful 2006, the institution sells DNA investigating kits that radical usage to larn astir their ancestry and health.

The institution struggled with recurring gross maturation due to the fact that radical conscionable took the DNA trial once. It besides faced privateness concerns. In 2023, hackers obtained idiosyncratic accusation of astir 7 cardinal customers. Some of the information accessed included ancestry trees, commencement years and geographic locations, highlighting the risks that travel with handing implicit information to backstage companies.

In an email sent to customers aft the merchantability was approved, 23andMe said that TTAM is committed to adhering to the company’s privateness argumentation and that customers person the close to opt retired of probe oregon delete their accounts.