SAN FRANCISCO — On March 23, 2025, 23andMe Holding Co. (Nasdaq: ME), a prominent genetics and biotechnology firm, announced it has voluntarily filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Eastern District of Missouri. The filing aims to facilitate a court-supervised sale process to maximize the company’s value while addressing financial and legal challenges. Despite the restructuring, 23andMe plans to maintain normal business operations and has secured up to $35 million in debtor-in-possession (DIP) financing from JMB Capital Partners to support ongoing activities.
The company, known for its DNA testing kits, intends to sell substantially all its assets via a Chapter 11 plan or Section 363 of the Bankruptcy Code, pending court approval. Mark Jensen, Chair of the Special Committee of the Board of Directors, stated, “After a thorough evaluation of strategic alternatives, we have determined that a court-supervised sale process is the best path forward to maximize the value of the business.” The process includes a 45-day bidding period, potentially followed by an auction if multiple qualified offers emerge, with any buyer required to adhere to data privacy laws under regulatory oversight like the Hart-Scott-Rodino Act.
Facing operational hurdles, including a 2023 data breach affecting 6.9 million customers and a $30 million settlement, 23andMe will use the proceedings to resolve legal liabilities and reduce costs, such as rejecting leases in Sunnyvale and San Francisco. Jensen added, “We expect the court-supervised process will advance our efforts to address the operational and financial challenges we face, including further cost reductions and the resolution of legal and leasehold liabilities.” The company assures no changes to customer data management, emphasizing transparency and privacy as priorities in any sale.
Leadership transitions accompany the filing. Co-founder Anne Wojcicki resigned as CEO effective immediately, following the rejection of her March 10 acquisition bid, but remains on the board. Joe Selsavage, Chief Financial Officer, steps in as Interim CEO, joined by Matt Kvarda of Alvarez & Marsal as Chief Restructuring Officer. Thomas Walper, a restructuring expert, joins the board and Special Committee, with Jensen appointed as Chair. These changes aim to steer 23andMe through its sale and reorganization, supported by advisors like Paul, Weiss and Moelis & Company.
Once valued at $6 billion after its 2021 SPAC debut, 23andMe has struggled with declining kit sales and profitability, reporting a $174 million loss in the first nine months of its fiscal year, per prior statements. The DIP financing and operational cash are expected to sustain the company during the process, detailed at https://restructuring.ra.kroll.com/23andMe. With 15 million customers’ genetic data at stake, the outcome will shape the future of its mission to advance human genome understanding.
