23andMe Cuts Jobs, Ends Drug Research After Data Breach
23andMe has announced it will lay off 40% of its workforce, impacting over 200 employees, and will close its therapeutics division to reduce costs. This restructuring follows a series of financial setbacks for the company, including a high-profile data breach and multiple rounds of layoffs. As part of these cost-cutting efforts, 23andMe plans to conclude ongoing clinical trials quickly and seek strategic alternatives for its drug development assets, including those focused on cancer treatments.
CEO Anne Wojcicki shared that these layoffs are essential for the long-term success of 23andMe’s core business in consumer genetics and research. The company has faced growing financial challenges, with its stock price dropping significantly since it went public in 2021. Last year, 23andMe reported a net loss of $667 million, more than double the previous year’s loss, driven by declining demand for its one-time DNA test kits and slowing growth in its telehealth and research services.
In addition to financial troubles, the company is dealing with ongoing legal fallout from its data breach last October. A class-action lawsuit has been proposed by customers whose genetic data was compromised, and regulatory agencies in Canada and the U.K. are investigating the breach. Amidst these difficulties, 23andMe hopes its restructuring and new leadership will reduce annual costs by $35 million and stabilize its business.
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