23andMe co-founder Anne Wojcicki is stepping down as CEO—however not stepping away. She plans to pursue the corporate as an impartial bidder
23andMe has filed for Chapter 11 chapter safety within the U.S. Chapter Court docket for the Jap District of Missouri, initiating a gross sales course of throughout which the corporate says it is going to proceed working as ordinary, with no adjustments to the way it shops, manages or protects buyer knowledge.
The biotech and genetics firm’s co-founder and CEO, Anne Wojcicki, can be exiting from her management function efficient instantly however will stay a member of the board.
The 23andMe particular committee not too long ago rejected an acquisition proposal from Wojcicki. Final September, all seven of 23andMe’s board of directors collectively resigned, citing variations over the corporate’s “strategic route” after Wojcicki signaled curiosity in taking 23andMe personal.
She acknowledged the chapter information on social media, writing that whereas she is disenchanted within the particular committee’s determination to take 23andMe by way of the Chapter 11 course of after her bid was rejected, she stays supportive of the corporate—and isn’t giving up.
“I’ve resigned as CEO of the corporate so I will be in the very best place to pursue the corporate as an impartial bidder,” she confirmed in a submit on LinkedIn.
“We have now had many successes, however I equally take accountability for the challenges we’ve as we speak,” Wojcicki, who co-founded the corporate in 2006, continued. “There is no such thing as a doubt that the challenges confronted by 23andMe by way of an evolving enterprise mannequin have been actual, however my perception within the firm and its future is unwavering. Shoppers are rising up and asking for extra management over their well being and need larger information about how you can be wholesome and why they might have well being points.”
The corporate has made a reputation for itself by way of accessible DNA testing that unlocks ancestry data in addition to customized well being insights.
“If I’m lucky sufficient to safe the corporate’s belongings by way of the restructuring course of, I stay dedicated to our long-term imaginative and prescient of being a worldwide chief in genetics and establishing genetics as a basic a part of healthcare ecosystems worldwide,” Wojcicki added.
Within the meantime, Joseph Selsavage, 23andMe’s chief monetary and accounting officer, will function interim CEO. Matt Kvarda, a managing director at Alvarez & Marsal, has been appointed chief restructuring officer.
If permitted by the court docket, 23andMe and an impartial funding banker will solicit certified bids over a 45-day course of. Ought to there be a number of certified bids submitted in the course of the court-supervised sale course of, 23andMe plans to conduct an public sale. 23andMe confirms it has filed customary motions with the court docket looking for quite a lot of “first-day” aid, together with paying worker wages and advantages and compensating sure distributors and suppliers on a go-forward foundation. A movement has additionally been filed looking for approval to reject quite a few contracts, together with actual property leases in Sunnyvale and San Francisco.
The corporate says all proceedings will probably be directed to resolve its excellent authorized liabilities stemming from its October 2023 cyber incident, the place the information of roughly 6.9 million folks was accessed by hackers, in response to TechCrunch. 23andMe subsequently settled a $30 million lawsuit final fall associated to the information breach.
The biotech and genetics firm says it’s obtained a dedication for debtor-in-possession financing of as much as $35 million from JMB Capital Companions, which, topic to court docket approval, is anticipated to help 23andMe in the course of the Chapter 11 course of.
Mark Jensen, 23andMe’s chair and member of the particular committee of the board of administrators, famous that the choice got here after a “thorough analysis of strategic alternate options” and {that a} court-supervised sale course of is “the very best path ahead.”
“We anticipate the court-supervised course of will advance our efforts to deal with the operational and monetary challenges we face, together with additional price reductions and the decision of authorized and leasehold liabilities,” Jensen stated. “We imagine within the worth of our folks and our belongings and hope that this course of permits our mission of serving to folks entry, perceive and profit from the human genome to reside on for the advantage of clients and sufferers.”
Final November, the California-based 23andMe introduced it might scale back its workforce by 40% (impacting greater than 200 staff) and sundown its therapeutics packages to streamline operations and scale back prices.
The uncertainty of 23andMe’s future and its ongoing monetary woes prompted California Lawyer Basic Rob Bonta to difficulty a client alert to 23andMe clients, reminding them that they’ll direct the biotech firm to take away and destroy their private data.
“California has sturdy privateness legal guidelines that permit shoppers to take management and request that an organization delete their genetic knowledge,” Bonta stated in a release that included directions for purchasers. “Given 23andMe’s reported monetary misery, I remind Californians to contemplate invoking their rights and directing 23andMe to delete their knowledge and destroy any samples of genetic materials held by the corporate.”
