Regeneron agrees to buy bankrupt 23andMe for $256 million, promises ethical use of customers' DNA data
Regeneron Pharmaceuticals (REGN.O) announced Monday that it will acquire 23andMe Holding for $256 million through a bankruptcy auction. The company emphasized its commitment to using customers' genetic data responsibly, especially data collected through ancestry and other consumer testing services.
The acquisition is intended to strengthen Regeneron's genomics-based drug research efforts by incorporating 23andMe’s database of over 15 million DNA profiles, gathered from its widely used at-home saliva test kits. Regeneron, headquartered in Tarrytown, New York, sees the deal as a strategic move to enhance its capabilities in precision medicine.
23andMe, based in South San Francisco, filed for bankruptcy last month after a sharp drop in demand and a 2023 data breach that compromised the personal and genetic data of millions. Court filings revealed the second-highest offer, at $146 million, came from a nonprofit started by Anne Wojcicki, the company’s cofounder and former CEO.
The deal, which is expected to close in the third quarter, reignites debate over data security and privacy, especially in light of last year’s breach. Once a pioneer in at-home genetic testing, 23andMe has seen waning interest in its core services.
“This transaction helps bring a positive resolution to what could have been a challenging bankruptcy,” said Daniel Gielchinsky, a trial attorney and partner at DGIM Law. He expressed confidence that Regeneron’s established reputation would lead to stronger protections for customer data under privacy laws.
In response to public concerns, Regeneron pledged to maintain 23andMe’s current privacy policies and fully comply with data protection regulations. The company will also cooperate with a court-appointed independent monitor who will evaluate the privacy implications of the acquisition. That monitor is expected to submit a report by June 10, ahead of a court hearing set for June 17 to approve the sale.
According to Bernstein analyst William Pickering, Regeneron’s investment in genomics aligns well with its strategic goals, though it may take ten years or more to yield substantial returns.
As part of the purchase, Regeneron will take over all of 23andMe’s business units except for Lemonaid Health, its on-demand telehealth service, which is being discontinued. Following the acquisition, 23andMe will become a fully owned subsidiary of Regeneron.