23andMe, a formerly high-flying genetic testing company, announced Sunday that it was declaring bankruptcy and that it would seek a buyer.
The company also said CEO Anne Wojcicki is resigning immediately and will be replaced by Chief Financial and Accounting Officer Joe Selsavage as interim chief executive.
23andMe moved in November to slash 40% of its workforce as part of a restructuring plan, a step that came roughly two months after its entire board resigned.
“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,” 23andMe Chair Mark Jensen said in a statement. “We believe in the value of our people and our assets and hope that this process allows our mission of helping people access, understand and benefit from the human genome to live on for the benefit of customers and patients.”
23andMe’s struggles have raised concerns about the privacy of its customers’ genetic data, which is used to trace people’s ancestry, among other purposes. In filing for bankruptcy protection, the company said there will be no changes to how it manages and protects people’s data.
23andMe users must explicitly affirm that the company may share their personal data, although people’s data could be included as part of a sale of the company. Some states have passed privacy laws that would require a person’s consent before their genetic data is transferred from one entity to another.
23andMe’s stock, which once traded for more than $300 a share, fell to $1.79 before the start of trade Monday.
The company filed for Chapter 11 protection in the U.S. Bankruptcy Court for the Eastern District of Missouri. 23andMe said that, if granted approval in bankruptcy court, the company would solicit bids from potential acquirers over a 45-day period and potentially conduct an auction.
In its bankruptcy announcement, 23andMe said any buyer of its assets would have to observe applicable privacy laws for customer data.
