The saga surrounding the once-hot DNA testing company 23andMe has taken another unexpected turn. Last month, biotech firm Regeneron purchased the company’s assets—including its genetic database of around 15 million users—for $256 million at a bankruptcy auction, seemingly closing the deal. However, a larger bid from Anne Wojcicki, 23andMe’s co-founder and former CEO, has prompted a second auction.
At a court hearing in St. Louis, Mo. yesterday (June 4), 23andMe’s attorney inadvertently revealed that Wojcicki’s post-auction proposal had reached $305 million. Wojcicki, who resigned as 23andMe’s CEO in March and has contested the outcome of the initial auction, joined forces with her nonprofit TTAM Research Institute to place the bid.
Following the revelation, representatives from 23andMe, TTAM, and Regeneron reached an agreement to reopen the sale process. The second auction, scheduled for later this month, will begin with TTAM’s new offer—nearly $50 million higher than Regeneron’s original winning bid.
23andMe’s shares soared more than 24 percent today after the news.
What happened to 23andMe?
The move marks a turning point in 23andMe’s tumultuous decline. Founded in 2006 by Wojcicki, the company initially gained traction with its saliva-based ancestry kits and went public in 2021. By the end of that year, its valuation peaked at $6 billion.
However, its financial situation quickly deteriorated. 23andMe struggled to generate consistent revenue beyond its DNA testing kits, which customers typically purchased only once. In 2023, the company faced a significant data breach that exposed information from roughly 7 million users, resulting in a class action lawsuit. Earlier this year, it filed for Chapter 11 bankruptcy.
Amid 23andMe’s downfall, concerns grew over the fate of its vast database of user DNA, with state attorneys general urging users to delete their genetic data from the platform. When Regeneron announced its acquisition of the company’s assets last month, it pledged to adhere to privacy laws and consumer policies regarding the genetic database—a commitment that TTAM also intends to honor should it win the upcoming auction.
Regeneron, which develops treatments for a variety of diseases, stated that it planned to use the data to accelerate medical research. The company also agreed to allow a court-appointed ombudsman and other stakeholders to review its privacy practices.
Another sale on the cards
For 23andMe’s upcoming auction, TTAM will kick off the process with its $305 million bid. Regeneron will then be required to place a higher bid, starting at $315 million, after which TTAM will have two hours to respond with a final proposal before the final bid goes to Regeneron. Lawyers for both sides agreed that the losing bidder will receive a $10 million “breakup fee.”
TTAM’s new bid is a substantial increase from the $146 million it offered during last month’s auction, and it far exceeds the initial $40 million bid Wojcicki proposed before 23andMe filed for bankruptcy in March. U.S. Bankruptcy Judge Brian Walsh described the negotiated terms of the new auction as a “very positive development” for equity holders during yesterday’s hearing.