23andMe Data Privacy Update: Bankruptcy Implications for Customers

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The genetic testing company 23andMe is entering federal bankruptcy proceedings, seeking a buyer to address its financial challenges. Co-founder Anne Wojcicki has stepped down as CEO, expressing hope to potentially purchase the company herself.

The California biotech firm has struggled financially for years, particularly with customer retention. In November, the company laid off more than 200 employeesapproximately 40% of its staffhighlighting its ongoing economic difficulties.

Once valued at $6 billion after going public in 2021, 23andMe’s potential sale has raised significant concerns about the privacy of genetic information from its 15 million users.

Data Privacy Landscape

The company’s bankruptcy announcement emphasizes customer data privacy as a critical consideration. However, legal experts warn that federal protections for genetic information are minimal.

“The scale of sensitive data 23andMe possesses is unprecedented,” says Suzanne Bernstein from the Electronic Privacy Information Center.

Current legal frameworks offer limited protection:

• – HIPAA applies only to healthcare providers
• – Genetic Information Nondiscrimination Act restricts employer and insurance discrimination
• – Only 11 U.S. states have laws giving consumers control over genetic data

Protecting Your Information

Experts recommend several proactive steps:

• – Delete your 23andMe account
• – Request destruction of genetic samples
• – Revoke research permissions

California Attorney General Rob Bonta advises residents to “consider directing 23andMe to delete their data and destroy genetic materials.”

Existing Data Sharing

23andMe has already shared anonymized data with pharmaceutical companies like GSK for drug development. “Many concerns about potential data misuse are already current practices,” notes legal expert Anya Prince.

The company will continue operating during bankruptcy proceedings, and customers can still manage their data. However, the long-term fate of this genetic information remains uncertain.

“This situation underscores the need for stronger consumer privacy legislation,” Bernstein emphasizes

 

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