South San Francisco-based genetic testing venture 23andMe saw its shares plunge more than 50% Monday after the company announced it had filed for Chapter 11 bankruptcy protection.
The company announced Sunday it will seek court authorization to sell substantially all of its assets, calling it “the best path forward to maximize the value of the business,” according to a filing in the U.S. Bankruptcy Court for the Eastern District of Missouri.
Chief Executive Anne Wojcicki will resign but remain on the company’s board, the announcement said.
More than 15 million people have provided 23andMe with DNA samples, representing a trove of genetic information that could be sold in bankruptcy proceedings.
But the company struggled to build a profitable business around DNA testing and its efforts to license data to pharmaceutical companies never caught on.
California Attorney General Rob Bonta issued a warning last week to remind consumers of their right to have their genetic data deleted. 23andMe customers can delete their data by logging onto their account.
“California has robust privacy laws that allow consumers to take control and request that a company delete their genetic data,” Bonta said. “Given 23andMe’s reported financial distress, I remind Californians to consider invoking their rights and directing 23andMe to … destroy any samples of genetic material held by the company.”
Board of Directors Chair Mark Jensen said in a statement that the company will prioritize the protection of consumer data throughout a sales process. Wojcicki said in a post on X over the weekend that she aims to buy the company’s assets.
“Data privacy will be an important consideration in any potential transaction,” Jensen said. “We are committed to continuing to safeguard customer data and being transparent about the management of user data going forward.”
23andMe shares were trading at 89 cents on Monday following Bonta’s warning.
In order to comply with Nasdaq listing requirements, the company did a reverse, 20:1 share split last fall.
