The 23andMe DNA testing company has announced that Regeneron Pharmaceuticals has agreed to purchase it for $256 million (£192 million).
This follows the firm's US bankruptcy filing two months ago.
As part of the agreement, 23andMe stated that Regeneron will adhere to its privacy regulations, and that Regeneron maintains safeguards to prevent unauthorized access to user information.
In response to requests from multiple US attorneys general, the business agreed last month to appoint an ombudsman to supervise customer data protection.
Worried that dishonest purchasers may use the information against innocent people, the authorities voiced their alarm.
In a statement, 23andMe announced that Regeneron will be acquiring practically all of its assets.
Under the terms of the deal, its subsidiary, Lemonaid Health, will be shut down.
Regeneron has stated its intention to utilize 23andMe's data for medication research, and the company will remain operational as a wholly-owned unit of Regeneron.
"We are pleased to have reached a transaction that maximizes the value of the business and enables the mission of 23andMe to live on, while maintaining critical protections around customer privacy, choice and consent with respect to their genetic data," Mark Jensen, chairman of 23andMe's board, stated.
The agreement was reached last week at the auction that was conducted as part of the company's bankruptcy process.
When the BBC asked for more comment, the firm declined.
Dr. Jennifer King, a privacy and data policy Fellow at the Stanford Institute for Human-Centered Artificial Intelligence, claims that Regeneron's goals differ from those that 23andMe offered to customers.
Dr. King asserted that 23andMe "always led with the non-profit 'we're helping humanity' side which helped obscure its for-profit mission" after interviewing several consumers for her research.
That it "is in the sole control of a company that is doing genetic research for pharmaceutical development" should make the profit-driven objective more apparent to customers, she noted.
Issues that a business faces
Anne Wojcicki co-founded 23andMe in 2006 and was CEO until March, when she resigned.
Oprah Winfrey, Eva Longoria, and Snoop Dogg are just a few of the famous people that have endorsed the brand throughout the years.
Despite going public in 2021 and seeing its worth surpass $6 billion, 23andMe was unable to generate a profit.
Weak demand for its testing kits and an inability to rethink the company's business strategy have doomed the once-celebrated firm.
The company's subscription service and attempts to exploit its large data set for medication research both bombed.
After that, in 2023, the firm had a data breach that made millions of consumers' genetic information public.
The company paid out a settlement to end a lawsuit that had claimed it had breached the privacy of around seven million consumers.
Using clients' previous passwords, hackers obtained family trees, birth years, and geographic locations; nevertheless, the business insists that DNA records were not among the stolen data.
About two months following the settlement, it laid off 200 workers, or about 40% of the staff.
Ms. Wojcicki attempted a takeover of the firm, but she was unwilling to allow a third party to do it.
Data Preservation
After 23andMe's March bankruptcy filing, some US attorneys general urged users to delete their data from the company's servers.
The business promised then that it would keep customer information secure in accordance with its privacy policy and that any purchaser of the business would be required to follow all applicable laws regarding the treatment of customer information.
However, it was "involved in a bankruptcy, merger, acquisition, reorganization, or sale of assets" and its privacy policy permitted access, sale, or transfer of personal information under certain other circumstances.
After many states accused 23andMe of not taking data security seriously enough, the firm decided to have a third party supervise consumer genetic data.