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The genetic company 23andMe declared bankruptcy

The genetic research company 23andMe filed for Chapter 11 bankruptcy protection to sell itself, the company reported on Sunday.

Founded in 2006, 23andMe allows customers to learn about their ancestry through proprietary saliva tests. The company stated that it would continue its operations while the bankruptcy court facilitates the sale process.

This move has raised concerns regarding the handling of personal data of millions of 23andMe customers.

The Attorney General of California Rob Bonta issued a 'consumer alert' regarding 'thousands of sensitive customer data collected by 23andMe', reminding Californians that they have the right to contact the company to request the deletion of existing genetic data, destroy test tubes, and revoke permission to use genetic data for research purposes.

In a statement to CM, 23andMe noted that 'the way it stores, manages, and protects customer data remains unchanged.'

Details about the company 23andMe

The past years have been tumultuous for the company. Last November, 23andMe announced a 40% workforce reduction, meaning the layoff of over 200 employees.

Founder and CEO Anne Wojcicki resigned after several unsuccessful attempts to merge the company, according to Reuters, but she stated that she did this 'to create the best opportunities for a self-proposed acquisition of the company.'

During the interim period, the company's Chief Financial Officer Joe Selkewich has been appointed as the CEO of 23andMe.

23andMe reported that it has received a debtor-in-possession financing commitment of approximately $35 million and expects to continue operations during the sale process. The company did not specify whether it had other acquisition proposals.

The report lists balance sheet assets and liabilities of between $100 million and $500 million.

A month before the restructuring process began, 23andMe entered into a $30 million settlement and agreed to provide three years of security monitoring to resolve a lawsuit that accused it of inadequate privacy protection for 6.9 million customers whose personal data was exposed during a data breach in 2023.

'We want to thank our employees for their dedication to the mission of 23andMe,' said Mark Jensen, chair and member of the Special Board Committee. 'We are committed to supporting them in the process of moving forward.'

'Moreover, we are committed to continuing to ensure the security of customer data and being transparent about user data management in the future, and data privacy will be an important condition of any potential deal,' he added.

This article used materials from FOX Business and Reuters.