USA – 23andMe, the genetics company best known for its DNA testing services, has announced the closure of its therapeutics division as part of a major restructuring effort.
The move, which includes laying off 200 employees, marks the end of the company’s drug development ambitions.
The restructuring comes after the company, which was once a leader in consumer health, struggled to regain financial stability.
After nearly a decade of investment in its drug discovery unit, 23andMe has decided to shut down its therapeutics division.
Despite pouring millions into research, the company only advanced two drug candidates to early-stage clinical testing.
The lead program, 23ME-00610, is an anti-CD200R1 antibody currently in a Phase I/IIa trial for solid tumors.
The second candidate, 23ME-01473, is designed to inhibit ULBP6 and has recently entered Phase I/IIa trials for patients with advanced solid tumors.
In a statement, 23andMe shared that “23ME-00610 has demonstrated early monotherapy responses, potential patient selection biomarkers, and combination potential for patients across multiple difficult-to-treat solid tumors.”
The company also stated that “23ME-01473 has yielded promising preclinical data with a novel NK-cell-activating mechanism.”
With the closure of its therapeutics division, the company plans to wind down these trials “as quickly as practical” and is exploring all options, including licensing deals or a sale of its clinical assets and preclinical pipeline.
Financial troubles and staff cuts
This restructuring follows a challenging period for 23andMe, including a significant drop in share value that led to concerns about the company’s NASDAQ listing.
In late 2023, the company’s shares fell below US $1, prompting CEO Anne Wojcicki to explore options to keep the company listed, including a proposal to take 23andMe private.
This proposal was rejected, resulting in the resignation of all independent board members.
To boost its share price and meet NASDAQ requirements, 23andMe completed a 1-for-20 reverse stock split in October.
Despite this, the company is still facing financial difficulties. In a bid to reduce costs, 23andMe announced it will cut 40% of its workforce, resulting in an annualized cost saving of more than US $35 million.
The restructuring is expected to incur about US $12 million in one-time costs.
Impact on collaboration with GSK
23andMe’s drug discovery efforts included a collaboration with GSK, which began in 2018.
The two companies worked together to identify disease-relevant genes and potential drug targets.
In 2023, they entered a data licensing agreement that gave GSK access to 23andMe’s genetic database for drug target discovery.
It remains unclear how the shutdown of 23andMe’s therapeutics division will affect this ongoing collaboration.
With the closure of its therapeutics division, 23andMe now shifts its focus back to its core DNA testing business.
