Latest / Connecting the Dots / A Deeper Dot - 23andMe Bankruptcy and Genetic Data Privacy

Transcript

A Deeper Dot - 23andMe Bankruptcy and Genetic Data Privacy · Connecting the Dots

• 0:00
  Today's tech news moves fast, but understanding
• 0:03
  it shouldn't be hard. That's why Snarfle Solutions
• 0:06
  Group brings you Connecting the Dots, where we
• 0:09
  break down what's happening in tech and why it
• 0:11
  matters to you. Now, let's dive in with your
• 0:14
  hosts. Welcome to Connecting the Dots, a special
• 0:18
  deep dive from us here at Snarfle Solutions Group.
• 0:21
  Yes, welcome. Today we're focusing on a situation...
• 0:25
  that has a lot of people asking questions, important
• 0:28
  questions, especially about something as personal
• 0:31
  as their own genetic information. The bankruptcy
• 0:33
  of 23andMe. Yeah, this is a unique set of circumstances
• 0:37
  here, where we have a company that was built
• 0:40
  on the intimate details of millions of people's
• 0:43
  DNA, and now it is facing financial collapse.
• 0:46
  And this immediately brings up those concerns
• 0:49
  for you, the listener, about what happens to
• 0:51
  all of that data. Your data. Exactly. I mean,
• 0:55
  you might have taken a 23andMe test years ago.
• 0:57
  Right. You know, you were curious about your
• 0:59
  ancestry, maybe health predispositions. Right.
• 1:02
  Maybe you found long -lost relatives through
• 1:04
  the service, like Jessica Lippincott in Wyoming,
• 1:07
  who discovered 49 half -siblings. 49, you're
• 1:10
  the service. Or perhaps you gained some valuable
• 1:14
  insights into your own health risks, as Hannah
• 1:17
  Snitko did. But now with this bankruptcy, the
• 1:19
  landscape has shifted dramatically. Absolutely,
• 1:22
  yeah. And our mission today is to unpack what
• 1:25
  this bankruptcy means for you, particularly regarding
• 1:28
  your personal data, your privacy, and the fundamental
• 1:31
  trust you placed in 23Anna. We've gathered information
• 1:35
  from news reports, expert analysis, and even
• 1:38
  the perspectives of individuals directly affected
• 1:41
  to give you a comprehensive picture. That's right.
• 1:43
  So let's start with how 23andMe got here. I mean,
• 1:47
  it wasn't always doom and gloom. Right. They
• 1:50
  were pioneers in this field. Indeed they were.
• 1:53
  23andMe was founded on that very innovative idea
• 1:57
  of direct to consumer genetic testing. They quickly
• 2:01
  attracted a huge customer base. Huge, yeah. We're
• 2:04
  talking around 15 million customers. Wow. Each
• 2:06
  paying about $100 for that service. OK. And by
• 2:10
  2021, the company reached a peat valuation of
• 2:13
  $6 billion. So they saw a significant rise in
• 2:18
  a really relatively short period of time. So
• 2:20
  what went wrong? I mean, if so many people were
• 2:22
  buying these tests, why the financial trouble?
• 2:24
  Well, you know, the core challenge appears to
• 2:26
  have been generating that sustainable revenue
• 2:28
  beyond that initial test purchase. I see. As
• 2:32
  noted in the Cowboy State Daily, people generally
• 2:35
  only needed the one test. Yeah. Right. So, you
• 2:40
  know, think about it. Once you've kind of explored
• 2:42
  your ancestry and those initial health predispositions,
• 2:46
  there's often not a recurring need. Yeah. For
• 2:49
  that same service. And so... their attempts to
• 2:53
  then leverage that massive genetic database through
• 2:56
  partnerships with, you know, big pharmaceutical
• 2:58
  companies like GSK, for example, for research
• 3:00
  purposes. That didn't bring in those consistent
• 3:03
  financial returns that they were likely hoping
• 3:05
  for. They also, you know, made ventures into
• 3:07
  selling health services and even exploring GLP
• 3:11
  -1 medications, but these efforts didn't manage
• 3:14
  to really turn the tide. So it really raises
• 3:17
  an interesting question for other data -driven
• 3:19
  businesses. How do you move beyond that initial
• 3:22
  data collection to create lasting value for both
• 3:25
  the company and the consumer? Yeah. And here's
• 3:27
  where it gets really interesting for you, the
• 3:29
  listener. OK. Beyond just the business model,
• 3:32
  a major event happened that significantly impacted
• 3:35
  trust and likely played a played a big role in
• 3:39
  their downfall. The twenty twenty three cyber
• 3:42
  security breach. Yes. This is a critical point
• 3:45
  to really consider because that breach. It compromised
• 3:49
  the sensitive data of approximately seven million
• 3:52
  individuals. Seven million? Wow. Yeah. And this
• 3:56
  event, as reported, it really damaged public
• 3:59
  trust and consumer confidence. And it makes sense,
• 4:02
  right? When a company holds such personal and
• 4:04
  really irreplaceable information, such as your
• 4:06
  genetic code, a breach of that magnitude, it
• 4:09
  really has profound consequences for that relationship
• 4:12
  with its users. And it's not a closed chapter,
• 4:14
  unfortunately. All right. As of March 2025, 23
• 4:17
  NME still faces 35 ,000 outstanding claims related
• 4:20
  to this breach. Wow. So this erosion of trust,
• 4:24
  I imagine, likely made their attempts to raise
• 4:26
  further capital or secure profitable partnerships
• 4:28
  even more difficult, contributing to the eventual
• 4:30
  financial crisis. Yeah, I think that's a very,
• 4:34
  very fair assessment. It certainly couldn't have
• 4:36
  helped. OK. And then, you know, adding to this
• 4:38
  instability where... Founder Anwar Chikki's repeated
• 4:42
  unsuccessful attempts to take the company private,
• 4:46
  which Tech News Weekly really highlighted as
• 4:49
  a sign of some internal challenges there. And
• 4:52
  then fast forward to March 2025, the news broke.
• 4:56
  23 Annie's market valuation had plummeted to
• 4:59
  just $50 million, culminating in the Chapter
• 5:03
  11 bankruptcy filing on March 28. A dramatic
• 5:07
  fall from grace. Huge fall. from that $6 billion
• 5:10
  peak. So the bankruptcy announcement obviously
• 5:12
  triggered a wave of reactions. I mean, we saw
• 5:16
  two very different responses highlighted in Y
• 5:20
  -meaning, which really illustrates the spectrum
• 5:22
  of feelings out there. Precisely. Precisely.
• 5:25
  On one side, you had millions of customers, like
• 5:27
  Hannah Snitko and Cheyenne, who immediately tried
• 5:29
  to delete their accounts and their genetic data.
• 5:31
  They were deeply concerned about what might happen
• 5:35
  to their information under new ownership. As
• 5:38
  Hannah herself put it, you know, we just don't
• 5:40
  know what will happen with it. There have been
• 5:42
  no assurances yet of the security of our data
• 5:44
  and what will happen going forward. And I think
• 5:47
  that feeling of uncertainty and that desire to
• 5:50
  regain control over their personal information
• 5:52
  is a very, very understandable reaction for many
• 5:56
  of you listening. Yeah, and it wasn't easy for
• 5:59
  those trying to delete their data. No, not at
• 6:01
  all. The sheer volume of deletion requests caused
• 6:05
  significant website issues, making it difficult
• 6:08
  for for many people, including Hannah, to actually
• 6:11
  complete the process. Right. And even receive
• 6:13
  confirmation. She noted that the site was very
• 6:16
  slow due to increased traffic. And those confirmation
• 6:19
  emails, they never arrived. And this really,
• 6:22
  this practical difficulty in actually exercising
• 6:24
  the right to delete their data only amplified
• 6:27
  the anxiety and frustration for users. Yeah.
• 6:30
  But then you have the other perspective, like
• 6:32
  Jessica Lippincott from Thermopolis. Her experience
• 6:35
  with 23 and Mania was life changing. It led her
• 6:37
  to her buy. biological father and 49 half siblings.
• 6:42
  So her view on the bankruptcy is quite different.
• 6:45
  Yeah, absolutely. Jessica has actually chosen
• 6:48
  not to delete her data. Interesting. Her hope
• 6:51
  is that a future buyer of 23andMe will actually
• 6:55
  utilize the genetic information for what she
• 6:58
  sees as really valuable purposes. Things like
• 7:01
  medical research and even solving cold cases.
• 7:06
  So she's very clearly weighing the potential
• 7:09
  benefits. against those risks. And she believes
• 7:13
  that, you know, any new owner would still be
• 7:16
  bound by existing laws governing sensitive genetic
• 7:18
  data. As she put it, if my data can be used by
• 7:21
  a future company to help other people, I'm all
• 7:23
  for it. I'm not going to delete it. So, you know,
• 7:26
  her perspective really highlights that potential
• 7:28
  for societal good that some individuals see in
• 7:32
  the collection and use of this type of data.
• 7:35
  OK, so with 23andy now in bankruptcy. What's
• 7:39
  the actual process regarding this vast amount
• 7:42
  of personal genetic information? Yeah. Your information
• 7:45
  as the listener. Well, so the bankruptcy court
• 7:48
  in St. Louis has approved the process of seeking
• 7:51
  a buyer for 23andMe. Bids from potential buyers
• 7:55
  were actually due by May 7th. OK. And a hearing
• 7:59
  to really examine these potential sales is anticipated
• 8:02
  in June 2025. So this chapter 11 bankruptcy process
• 8:07
  is designed to allow a company to reorganize
• 8:10
  its finances while protected from those creditors.
• 8:14
  It includes exploring a potential sale of the
• 8:17
  company and its assets. And of course, that includes
• 8:19
  that massive database of genetic information.
• 8:21
  And this idea of a sale, I imagine, is what's
• 8:23
  causing a lot of the anxiety. Who might buy 23andMe?
• 8:27
  And what could they potentially do with all that
• 8:29
  data? Those are very valid concerns. Experts
• 8:32
  like Jeffrey Fowler from the Washington Post,
• 8:35
  speaking on Tech News Weekly, have emphasized
• 8:38
  that genetic data is uniquely sensitive. because
• 8:42
  it represents information you cannot change and
• 8:45
  could have unforeseen future implications. Wow.
• 8:48
  Including, you know, potential insurance discrimination
• 8:51
  or misuse. That's scary. Yeah, and the sheer
• 8:55
  volume of this data, as Suzanne Bernstein from
• 8:58
  the Electronic Privacy Information Center pointed
• 9:00
  out, makes this a very unique situation with
• 9:03
  potentially far -reaching consequences depending
• 9:05
  on, you know, who acquires it. Right. And for
• 9:08
  what purpose. So are there any safeguards in
• 9:11
  place for consumers like you during this process?
• 9:15
  Fortunately, yes. There are some legal frameworks
• 9:19
  in place that offer some level of protection.
• 9:21
  Things like California's Consumer Privacy Protection
• 9:24
  Act, the CCPA, and other state -geneted privacy
• 9:28
  laws. These give you the right to request the
• 9:30
  deletion of your data. OK, that's good. Also,
• 9:34
  an attorney with the US trustee program, which
• 9:36
  oversees bankruptcies, has asked the court to
• 9:41
  appoint an ombudsman specifically to oversee
• 9:44
  the sale and help protect consumer data. And
• 9:47
  the company's attorneys have also pointed out
• 9:49
  that US bankruptcy law itself requires a buyer
• 9:53
  to adhere to existing privacy policies. So these
• 9:56
  legal mechanisms do offer some level of protection.
• 10:00
  However, as Hannah's experience showed, the practical
• 10:03
  application of those rights isn't always seamless.
• 10:06
  Right, right. So it's good to know that there
• 10:08
  are some protections, but it's still a time of
• 10:10
  uncertainty. Even 23 anime themselves have stated
• 10:14
  that customer data privacy will be an important
• 10:16
  consideration in any sale. Right. But it really
• 10:19
  highlights that delicate balance between business
• 10:22
  interests and the rights and expectations of
• 10:25
  individuals, like you, who entrusted them with
• 10:27
  their genetic information. Absolutely. And it's
• 10:30
  something that we all need to be more aware of.
• 10:32
  Yeah. This whole situation really makes you think
• 10:35
  about the broader implications for you, for you,
• 10:38
  the listener, of sharing such personal information,
• 10:40
  right? Absolutely. Absolutely. 23MB's bankruptcy
• 10:43
  serves as a very critical reminder. for you about
• 10:47
  those long -term implications of sharing personal
• 10:50
  data, especially something as fundamental as
• 10:52
  your genetic code. As Suzanne Bernstein from
• 10:55
  the Electronic Privacy Information Center noted,
• 10:58
  the scale of highly sensitive data that 23andMe
• 11:02
  holds is really unique. And federal law offers
• 11:05
  limited specific protections for genetic information
• 11:08
  held by private companies outside of... of healthcare
• 11:12
  and employment context, like IP and GINA. On
• 11:16
  your prints, a law professor at the University
• 11:17
  of Iowa, she echoed this as well, noting that
• 11:21
  federal protections are quite limited beyond
• 11:24
  those specific areas. And that leaves a bit of
• 11:27
  a gap in how your genetic data is protected in
• 11:29
  those commercial settings. So what can someone
• 11:32
  like you, listening, who used 23 -amine or is
• 11:36
  considering genetic testing in the future, take
• 11:38
  away from all this, what are some pro - proactive
• 11:41
  steps that you can consider? Well, the key is
• 11:44
  to be informed and proactive. Really understand
• 11:48
  your rights regarding your data. Many experts
• 11:50
  recommend that Concern23NB customers should consider
• 11:53
  deleting their data, requesting the destruction
• 11:56
  of their saliva samples, and revoking any permissions
• 11:58
  for research use. And this is also advice that
• 12:03
  California's Attorney General, Rob Bonta, also
• 12:06
  gave. And for those considering genetic testing
• 12:09
  in the future, you know, this situation really
• 12:12
  underscores the importance of carefully reviewing
• 12:14
  a company's privacy policies, really understanding
• 12:17
  how your data will be used and considering those
• 12:20
  long -term implications before sharing such sensitive
• 12:23
  information. Yeah. And this situation highlights
• 12:26
  the ongoing need for stronger consumer privacy
• 12:28
  laws, especially as more and more companies collect
• 12:30
  and hold this type of sensitive information.
• 12:33
  You know, as Hannes Nitko put it, even though
• 12:35
  she initially enjoyed the service, she now feels
• 12:38
  a loss of control over her personal genetic data
• 12:40
  and would think twice about such services in
• 12:43
  the future. It really underscores the evolving
• 12:46
  relationship between individuals and the companies
• 12:50
  that hold their most private details and the
• 12:53
  need for regulations to really keep pace with
• 12:56
  these technological advancements. Absolutely.
• 12:58
  So this deep dive into 23 immediate bankruptcy
• 13:00
  shows just how complex the intersection of your
• 13:04
  personal data technology and business can be.
• 13:07
  And it underscores the importance for you, the
• 13:10
  listener, to understand not only the potential
• 13:12
  benefits of services like genetic testing, but
• 13:14
  also the potential risks and what happens when
• 13:16
  things take an unexpected turn. And the contrasting
• 13:20
  reactions of individuals like Jessica, who sees
• 13:24
  potential for... for good in her data being used.
• 13:29
  And Hannah, who prioritizes deleting her information
• 13:32
  due to those privacy concerns, really highlights
• 13:35
  the diverse perspectives and valid questions
• 13:38
  surrounding your ownership and control of your
• 13:41
  most personal information. There isn't really
• 13:44
  a one size fits all answer. Right. And your comfort
• 13:47
  level and priorities will really guide those
• 13:50
  decisions. Absolutely. So ultimately, the situation
• 13:54
  with 23andMean raises an important question for
• 13:56
  all of you listening. In an increasingly data
• 13:59
  -driven world, how do we balance the desire for
• 14:02
  knowledge and convenience with the need to protect
• 14:05
  our privacy and maintain control over our sensitive
• 14:08
  information? It's something to really consider
• 14:11
  as you navigate the ever -evolving technological
• 14:14
  landscape. It really is. And we are here to help
• 14:17
  here at SNARFL, so reach out on our website if
• 14:19
  you have any more questions. Great. Thanks for
• 14:22
  joining us today. Of course. And we'll see you
• 14:24
  next time. I'm on Connecting the Dots.