23andMe Files for Bankruptcy: What Happens to Millions of DNA Records Now?

The genetic testing giant 23andMe has officially filed for Chapter 11 bankruptcy, raising urgent questions about the fate of millions of customers’ DNA data. With the company facing financial turmoil, privacy advocates and consumers alike are demanding answers—could sensitive genetic information be sold off?

The Fall of a Genetic Testing Titan

Once a pioneer in direct-to-consumer DNA analysis, 23andMe struggled with declining sales, regulatory scrutiny, and rising competition. The bankruptcy filing reveals:

• $1.7 Billion in Debt: The company owes major creditors, including pharmaceutical partners.
• Stock Plunge: Shares dropped over 90% from their peak, wiping out investor confidence.
• Failed Drug Development: Attempts to monetize genetic data for drug research stalled.

Your DNA Data: Asset or Liability?

The company holds genetic profiles for 14 million users, creating a potential treasure trove for bioresearch firms—or a nightmare privacy breach waiting to happen.

1. Bankruptcy Auction Risk: Creditors could push for data sales to recoup losses.
2. Anonymization Loopholes: Even “de-identified” DNA can often be traced back to individuals.
3. Opt-Out Challenges: Former users report difficulties deleting data despite company promises.

Legal Safeguards—Or Lack Thereof

Unlike bank accounts or medical records, genetic data lacks strong federal protections in bankruptcy proceedings. Key concerns:

• No clear rules prevent DNA databases from being liquidated.
• 23andMe’s privacy policy states data may be transferred in “business transactions.”
• State laws vary widely, with California offering slightly stronger consumer rights.

What’s Next for Customers?

The company insists operations will continue “as normal,” but experts warn users to:

• Download their raw DNA data immediately.
• Submit deletion requests in writing (though enforcement is uncertain).
• Monitor for unauthorized use via services like Have I Been Pwned.

What Do You Think?

• Should bankruptcy courts treat DNA data differently than other corporate assets?
• Would you trust a pharmaceutical company with your genetic code if it led to medical breakthroughs?
• Is it ethical for a failing company to sell intimate biological data to the highest bidder?
• Has the era of recreational DNA testing created risks we can’t undo?