Genetic testing firm 23andMe is supported via a SPAC by Richard Branson

The home business, DNA testing 23andMe, will be backed by a special procurement company (SPAC), backed by Richard Branson, founder of Virgin Group.

“We have always believed that healthcare should be driven by the consumer, and we have a great opportunity to personalize the experience on a large scale so that individuals can be more proactive about their health and well-being,” says Anne and her co-founder, 23andMe. Wojcicki said in a statement.

The deal values ​​the company at $ 3.5 billion, and current shareholders will own 81 percent of the company. Wojcicki and Branson each invested $ 25 million as part of the $ 250 million fund set up to promote the company. The deal is expected to end in the second quarter, and then the company will trade on the New York Stock Exchange under the symbol ME.

SPACs, which became popular in 2020, are formed by groups of investors with the aim of acquiring a company. Also known as a ‘blank-check’ company, a SPAC is seen as a less risky option than the traditional stock market, and it offers newer companies access to late-stage amounts of capital.

23andMe, launched in 2006, sells saliva sets that people can use at home to determine their genetic ancestry and their chances of developing certain diseases. The company has an estimated ten million customers in its database and says more than 80 percent of customers agree to participate in medical research.

Wojcicki said Thursday that the funds will allow the company to expand into the development of therapeutic agents, which are seen as a more lucrative market than DNA testing by consumers, according to The Wall Street Journal. A slide announcing the deal showed the company sees great growth potential in the therapeutic market.

23andMe

Some blame the downturn in the popularity of DNA home tests on privacy issues, including reports that the FBI has used genetic results from databases of consumer DNA companies to solve cold crimes. 23andMe and other businesses have promised not to share customers’ data without permission.

Wojcicki on Thursday acknowledged a slowdown in the DNA home test market. “We have always seen health a much greater opportunity” than DNA descent, she said WSJ.

Branson, an early investor in 23andMe, said on Thursday “there is no better money to invest in healthcare.”