Regeneron Acquires 23andMe for 6 Million Following Bankruptcy Proceedings
Regeneron Pharmaceuticals has announced a significant acquisition, purchasing genetic testing company 23andMe for 6 million through a bankruptcy auction. Once valued at a remarkable billion, 23andMe is best known for its at-home saliva testing kits that have allowed approximately 15 million individuals to explore their genetic makeup. With this acquisition, Regeneron aims to enhance its capabilities in genomics-driven drug discovery by leveraging customer DNA profiles to potentially advance therapeutic developments.
In its statement, Regeneron emphasized its commitment to the ethical utilization of customer DNA data. This acquisition comes at a pivotal moment for 23andMe, which has recently faced challenges, including a data breach in 2023 that raised substantial concerns regarding the privacy and security of sensitive genetic information. As a pioneering firm in ancestry DNA testing, 23andMe’s reputation has suffered due to diminished demand for its core services and the fallout from the breach, prompting increased scrutiny from various lawmakers.
The awareness surrounding data privacy has intensified following 23andMe’s bankruptcy filing in March, which has drawn attention from congressional committees and federal agencies, such as the Senate Health, Education, Labor and Pensions Committee and the Federal Trade Commission. These bodies have expressed concerns that the company’s extensive database could potentially fall into the hands of malicious actors.
In response, Regeneron has assured stakeholders that it will uphold 23andMe’s existing privacy policies and rigorously comply with all relevant data protection regulations. Furthermore, the company has committed to working transparently alongside a court-appointed independent overseer tasked with evaluating the implications of the acquisition for consumer privacy, with a detailed report expected by June 10. The court is set to consider the approval of the acquisition on June 17.
Industry experts suggest that investments in genomics make strategic sense for Regeneron, although returns may take a decade or longer to materialize. Bernstein analyst William Pickering conveyed confidence that 23andMe’s customers would be well-protected under Regeneron’s stewardship, highlighting the company’s strong track record in maintaining privacy standards. Under the terms of the acquisition, Regeneron will gain control over all units of 23andMe except for its on-demand telehealth service, Lemonaid Health, which will be discontinued.
Despite the positive outlook related to this acquisition, Regeneron shares experienced a decline of 0.6 percent following the announcement. However, it is worth noting that the company’s stock has gained approximately 2.86 percent over the prior week, reflecting a complex but ultimately promising trajectory for the integration of 23andMe into Regeneron’s operations.
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