What Happens if a DTC Genomics Company Goes Belly Up?
The following post was originally published in three parts on September 14, 15 and 16 in Genetic Future.
Direct-to-consumer (DTC) genomics companies are not immune to the current recession. When TruGenetics, a new player in the DTC genomics space, announced in June that it would be handing out 10,000 free genome scans, both Genetic Future and the Genomics Law Report raised questions about the financial viability of its business model, particularly in the current economic climate. Sure enough, on August 21, TruGenetics announced that it had been unable to secure funding sufficient to support its business model as contemplated. Frequent readers know that TruGenetics is not the only DTC genomics company that is struggling. The financial struggles of deCODE Genetics have been well chronicled (see here, here and here) and even new market leader 23andMe has undergone a dramatic shift in its top management as it pursues a new round of financing.
Ultimately, it was a recent headline here at Genetic Future—“deCODE Genetics on the brink of insolvency”—that started us thinking: what would happen if an established DTC genomics company actually went bankrupt? More specifically, what would happen to the genomic (and other) data held by the company? Genomic data is likely to be the company’s most valuable asset. Can that data be sold off to help meet the company’s debts? Bankruptcy can be a confusing and arcane process, with real risks and uncertainties for companies, their creditors and their customers.
