A U.S. bankruptcy court has given the green light to sell “substantially all” assets of genetic testing company 23andMe to TTAM Research Institute, a nonprofit organization led by co‑founder Anne Wojcicki, in a $305 million deal that closes a chapter marked by legal battles and privacy concerns apnews.comreuters.com. The ruling by Judge Brian C. Walsh came on Monday after an auction process in which TTAM outbid pharmaceutical firm Regeneron, which had offered $256 million in May apnews.com.
The sale includes the company’s core Personal Genome Service, research operations, and its telehealth arm Lemonaid Health. 23andMe originally filed for Chapter 11 bankruptcy protection in March amid losses linked to a 2023 data breach and growing questions about its business model apnews.com. Under the terms of the agreement, TTAM must honor existing privacy rules and allow customers to delete their data or opt out of research studies before the transaction closes apnews.com.
Legal Objections from States
Despite the court’s approval, 27 states and the District of Columbia filed suit to block the sale on grounds that it violates privacy laws requiring explicit consent politico.com. California Attorney General Rob Bonta said the transaction “does not comply” with the state’s Genetic Information Privacy Act, which demands clear opt‑in permission before transferring genetic data politico.com. Other states joining California include Kentucky, Tennessee, Texas, and Utah. Although Judge Walsh ruled that GIPA does not apply because privacy policies remain intact, some state attorneys general have vowed to pursue further legal options politico.com.
The judge acknowledged during the hearing that selling personal genetic data “is a scary proposition,” yet he noted TTAM’s commitment to bolster data security and respect customers’ rights to remove their information apnews.com. In a bid to reassure users, TTAM has pledged to send direct notices about privacy terms and offer two years of free identity theft monitoring after closing.
From Start‑Up to Bankruptcy
Since its launch in 2006, 23andMe led the consumer genetics market by offering DNA tests and personal reports on ancestry and health traits. The company went public in 2021 but struggled to build a profitable model as consumers questioned the value of its reports and raised privacy alarms. In 2024, its board resigned amid disagreements on strategy, and Wojcicki stepped down as CEO when the bankruptcy case began reuters.com.
Through Moelis & Co., the court‑supervised sale mandated that any buyer uphold the company’s existing privacy framework. Regeneron had eyed the data for research gains in drug development, but it did not include Lemonaid Health in its bid. TTAM’s higher offer and promise to operate as a nonprofit tipped the scales in its favor reuters.com.
Next Steps and Closing Timeline
The transaction is set to wrap up within weeks, subject to standard closing conditions and any state court actions that may arise. TTAM plans to relaunch the services under its nonprofit banner and maintain open access to genomic reports while funding research for public benefit apnews.com.
Personal Analysis
This ruling signals a shift in how personal genetic data can be handled under bankruptcy law. By placing control in a nonprofit, the deal may offer stronger consumer protections than a sale to a for‑profit buyer. Yet states’ pushback highlights real unease about consent and data ownership. In the end, 23andMe customers will need to watch carefully for privacy updates and exercise their rights if they choose to leave the service. The closing weeks ahead will test whether TTAM can truly balance public research goals with individual privacy rights.
