Bankrupt DNA testing company 23andMe to be bought by Regeneron | CBC News
Drugmaker Regeneron Pharmaceuticals says it will comply with privacy policies regarding the use of customer data. 23andMe's bankruptcy filings had drawn scrutiny from lawmakers who warned that millions of customers' genetic data could be sold to unscrupulous buyers.
Regeneron Pharmaceuticals said on Monday it will buy genetic testing firm 23andMe Holding for $256 million USD through a bankruptcy auction, and promised to prioritize the ethical use of customers' DNA data.
Through the deal, Regeneron says it aims to bolster its capabilities in genomics-driven drug discovery by integrating 23andMe's trove of over 15 million customer DNA profiles, collected via its popular direct-to-consumer saliva testing kits.
The transaction will, however, put the spotlight back on data privacy issues, especially in light of 23andMe's recent challenges.
The genomics company once a trailblazer in ancestry DNA testing had been struggling with weak demand for its testing kits and reputational damage from a data breach in 2023 that exposed millions of customers' genetic data. The company has collected genetic data from 15 million customers who ordered its DNA testing kits online and provided saliva samples.
The hack and subsequent bankruptcy filing has drawn scrutiny from lawmakers who warned that millions of customers' genetic data could be sold to unscrupulous buyers.
Regeneron said it will comply with 23andMe's privacy policies and applicable laws with respect to the use of customer data.
The drugmaker also committed to working transparently with a court-appointed independent overseer, who will assess the implications of the deal for consumer privacy and is expected to deliver a report to the court by June 10.
The court is scheduled to consider approval of the transaction on June 17.
The investments in genomics "make good strategic sense" for Regeneron, but it might take a decade or more to see a return, Bernstein analyst William Pickering said.
"Given Regeneron's track record, we also believe 23andMe customers are in good hands from a privacy perspective," Pickering added.
As part of the agreement, Regeneron will acquire all units of 23andMe, except telehealth service Lemonaid Health, which the genetic testing firm plans to wind down.
After the transaction, expected to complete in the third quarter, 23andMe will operate as a wholly-owned unit of Regeneron.
