**23andMe Bankruptcy Auction Faces Scrutiny from Judge**
In a recent court hearing, the judge overseeing the bankruptcy proceedings of 23andMe raised concerns about the proposed limits for a second auction aimed at increasing bids beyond the current $256 million offer from Regeneron Pharmaceuticals. U.S. Bankruptcy Judge Brian Walsh questioned the rationale behind the limits supported by both Regeneron and 23andMe, which have drawn criticism from the only other bidder, a California-based research institute associated with former 23andMe CEO Anne Wojcicki.
Judge Walsh is tasked with determining whether to impose auction limits that would allow Regeneron a final bidding opportunity while excluding Wojcicki and the TTAM Research Institute. He described the current auction rules as potentially “inefficient” and expressed doubts about a $10 million breakup fee that would be payable to Regeneron if it loses the auction.
During the federal court session in St. Louis, all parties were present to discuss how to revive the bidding process after a previous auction last month, which 23andMe initially claimed Regeneron won with its $256 million bid. Wojcicki contested the outcome, alleging that the auction was unfairly closed to favor Regeneron. Her attorney, Susheel Kirpalani, argued that the proposal is “one-sided” and lacks a level playing field.
The previous auction lasted three days, with both sides accusing 23andMe of bias. Following the auction, TTAM and Wojcicki submitted a bid that was “substantially higher” than Regeneron’s, according to 23andMe’s bankruptcy attorney, Christopher Hopkins. In response, 23andMe suggested a new final bidding round with the current limits, which Regeneron accepted but Wojcicki opposed. Hopkins warned that without these limits, Regeneron might withdraw its $256 million bid, potentially allowing TTAM and Wojcicki to acquire 23andMe for their last binding bid of $156 million.
Amidst these proceedings, there has been significant pressure from customers and government officials for 23andMe to safeguard the genetic data it has accumulated over the years through saliva sample collections. Both bidders have committed to adhering to 23andMe’s privacy policy, which permits customers to request the deletion of their personal information.
23andMe filed for bankruptcy in March after struggling to achieve sustainable profits from its medical and ancestry-related genetic testing services, which have attracted over 15 million customers. However, only about 550,000 individuals subscribed to the company’s two primary services, insufficient to maintain operations. The company announced that one of its services, Lemonaid Health, will not be part of the sale and will be phased out.
In the lead-up to its bankruptcy, 23andMe sought a buyer while also attempting to resolve a class-action lawsuit stemming from a 2023 data breach that compromised customer information.
**FAQ**
**What is the current status of the 23andMe bankruptcy auction?**
The auction is under scrutiny as the judge questions proposed limits that may favor one bidder over another. A second auction is being considered to encourage higher bids.
