Oregon Attorney General Dan Rayfield has issued a consumer alert after genetic testing company 23andMe filed for bankruptcy protection.

The company announced the filing on Sunday. It also said co-founder and CEO Anne Wojcicki would be stepping down immediately.

San Francisco-based 23andMe said it will look to sell “substantially all of its assets” through a court-approved reorganization plan, as the struggling company continues its push to cut costs.

In his consumer alert, Rayfield reminded Oregon consumers that they can determine what happens with any personal data they have given to the company.

“23andMe must work to safeguard this incredibly sensitive genetic information, regardless of their bankruptcy filing,” he said. “Oregonians need to know that they still have full control over their own data — they can delete their genetic information and test samples on the website and pull the plug on any permission for 23andMe to share it with researchers.”

Rayfield also shared step-by-step instructions for concerned 23andMe customers who want to delete their accounts or personal information. The process involves logging into your account and deleting your data using the settings menu.

23andMe has faced an uncertain future for some time. Beyond battles to go private, the company has struggled to find a profitable business model since going public in 2021.

Privacy concerns related to customers' genetic information have also emerged, notably spanning from a 2023 data breach — along with questions around what new ownership could mean for users' data.

Here’s what to know:

23andMe’s bankruptcy follows months of turmoil

23andMe was founded in 2006, with a promise to revolutionize the future of genetics and health care. The company became known for its saliva-based DNA testing kits — purchased by millions of customers eager to learn more about their ancestry — and later dived further into health research and drug development.

But recent years have been far from smooth sailing for 23andMe. And Sunday’s voluntary bankruptcy filing caps months of turmoil.

Last September, all of its independent directors resigned in a rare move following acquisition negotiations with Wojcicki.

The company then announced in November that it would lay off 40% of its workforce, or more than 200 employees, and discontinue its therapeutics division. And in January, the board’s special committee said it was exploring strategic alternatives, including a possible sale.

Shares of 23andMe Holding Co. have shed nearly all their value since last spring and plunged even farther after Sunday’s bankruptcy filing, trading at under $1 as of midday Monday.

In recent securities filings, 23andMe continued to warn about its “ability to continue as a going concern,” which is accounting-speak for having the resources needed to operate and stay in business.

Sunday’s Chapter 11 filing from 23andMe reported total debts of more than $214.7 million as of the end of last year. Assets, meanwhile, amounted to over $277.4 million.

What does Chapter 11 mean for the company?

23andMe says that filing for Chapter 11 bankruptcy protection will help facilitate a sale of the company, meaning that it’s seeking new ownership.

In a statement Sunday, Board Chair Mark Jensen said that this court-supervised process was “the best path forward.” He added they also expect it to help 23andMe’s efforts to cut costs as well as resolve legal and leasehold liabilities.

23andMe is looking to pull back from its real estate footprint. Among motions filed on Sunday, the company is seeking court approval to reject lease contracts in San Francisco and Sunnyvale, California, for example, in efforts to help cut down on expenses.

Otherwise, 23andMe says it plans to continue operating. The company says it’s received $35 million in debtor-in-possession financing from JMB Capital Partners to help support its business throughout the bankruptcy process.

I’m a 23andMe customer. Is my genetic data safe?

23andMe says its bankruptcy filing won’t change the way it stores or protects data. Jensen, the board chair, said Sunday that 23andMe is “committed to continuing to safeguard customer data” and that data privacy will be “an important consideration” in any future sale.

John Bringardner of Debtwire notes that any new buyer of 23andMe will have to comply with regulatory approvals that ensure “customer data won’t end up in unscrupulous hands.”

Still, who will end up owning 23andMe down the road is unknown. And experts note that risks remain.

“Personal data collected by 23andme has always been at risk,” Bringardner wrote in emailed commentary on Monday — pointing particularly to a 2023 data breach that compromised ancestral information for nearly 7 million 23andMe customers. He adds that litigation spanning from the aftermath of this breach helped drive up liabilities that eventually contributed to the current bankruptcy filing.

Last year, 23andMe agreed to pay $30 million in cash to settle a class-action lawsuit accusing the company of failing to protect customers whose personal information was exposed in this breach. On Sunday, the company said that it plans to use bankruptcy proceedings to “resolve all outstanding legal liabilities” stemming from the October 2023 incident.

Beyond this data breach, uncertainty about the company’s future overall has also led some to recently urge 23andMe customers to delete their data.

On Friday, days before 23andMe’s bankruptcy filing, California Attorney General Rob Bonta issued an urgent alert reminding 23andMe customers of their legal rights under state law — and called on them to consider deleting and destroying any genetic data held by the company.

Bonta’s office pointed to 23andMe’s ongoing financial distress and the “trove of sensitive consumer data” the company has amassed.

______

AP Health Writer Tom Murphy contributed to this report from Indianapolis.

News Source : https://www.opb.org/article/2025/03/25/oregon-23andme-attorney-general-dan-rayfield-consumer-alert-genetic-testing-data-privacy/