DNA testing company 23andMe has initiated a voluntary Chapter 11 process, following a period of significant challenges, including substantial layoffs and a major data breach. The company intends to find a buyer and continue operations throughout the process. Notably, CEO Anne Wojcicki has resigned to pursue an independent bid for the company, after the Board of Directors’ Special Committee previously rejected a proposal from her.

Mark Jensen, chair and member of the Special Committee, stated in a release, “We anticipate that the court-supervised process will facilitate our efforts to address the operational and financial challenges we face, including further cost reductions and the resolution of legal and leasehold liabilities. We believe in the value of our people and our assets, and we hope that this process will allow our mission of helping people access, understand, and benefit from the human genome to continue for the benefit of customers and patients.”

Jensen also emphasized that the company is committed to safeguarding customer data, and “being transparent about the management of user data going forward, with data privacy being a key consideration in any potential transaction.”

23andMe was once a highly popular company, with many individuals sending in saliva samples. However, its fortunes have declined since going public. The company was previously valued at $6 billion, but this month its value has dropped to less than $50 million. Additionally, the company laid off over 200 employees late last year.

One of the major challenges the company faced was a significant data breach in 2023, in which hackers accessed the information of 6.9 million customers. The breach began in April of that year but went unnoticed by 23andMe for five months, until it was discovered in September. The company announced the leak the following October. A year later, 23andMe settled a class action lawsuit for $30 million, following allegations that the company had failed to inform plaintiffs that they were specifically targeted due to their Chinese or Ashkenazi Jewish heritage.

Following the news, California Attorney General Rob Bonta recommended that 23andMe customers delete their data as a precaution. Instructions on how to do so can be found here.