23andMe Introduces a New Service While Dealing with the Impact of Data Privacy Concerns

+14 votes
357 views

I didn't want to take one of the existing Questions about 23andMe, the data privacy battle they're now fighting (that's also bled over to impact at least MyHeritage), and the 23andMe suspension of some of its comparison and matching features off onto a tangent, so I decided to start a new thread about the company's newest offering, announced late yesterday evening in the U.S., after close of stock market trading.

This is a direction I was expecting 23andMe to go very shortly after they went public in June 2021. Why it's taken over two years I'm not certain and, frankly, the consumer cost and the overall process seems as if it will be unattractive to most. At least, there's no appeal there for people primarily interested in genealogy, and the new service won't provide any new features or benefits for genealogists.

Too, even if they were prepared to introduce the new offering now, is now really the right time to do it amidst the constant barrage of negative news and multiple lawsuits filed regarding the data privacy incident? It's only been a few days since they decided to, at least temporarily, disable all display of chromosomal detail in light of the security concerns.

Nevertheless, introduced about 12 hours ago is: "A Totally New 23andMe Health Membership: Total Health," which launches for sale starting in early November: https://blog.23andme.com/articles/total-health.

"Total Health is designed to be a comprehensive, prevention-based membership, combining clinical grade exome sequencing, biannual blood testing, and unprecedented access to clinicians trained in genetics. Total Health will also include all the reports and features offered in our existing 23andMe+ Membership in addition to these new services."

The genetic underpinning of the service is whole exome sequencing. The exome is spread around the genome and is the portion of your DNA that contains coding genes and some supporting elements. It is essentially useless to genealogy because most humans are identical here with the few exceptions regarding phenotype, things that affect structure and appearance like skin color, whether your second toe is longer than your big toe, etc. The exome is relatively small in relation to your whole genome, a bit over 30 million base pairs out of your roughly 3.08 billion, or a little less than 2%.

"Total Health will be available for those 18 and older in the United States (excluding Hawaii, New Jersey, New York, Oklahoma and Rhode Island). The 23andMe+ Total Health membership will cost $99 per month, billed in a one-time annual payment. It will be available to new customers in early November, and offered to existing 23andMe customers in the spring of 2024."

I suppose saying it costs $99 monthly, paid annually, makes it sound less expensive than $1,188 per year. The twice-per-year blood testing will be "initiated" by a 23andMe clinician "and members will complete their testing through a local lab offered by a third-party provider."

Clinical grade (30X coverage and higher) whole genome sequencing (WGS) is now routinely available to consumers for under $300. If 23andMe had to take the time and spend money gearing up their labs for whole exome sequencing (WES), I'm uncertain why they didn't come out with a WGS option, instead. The exome is in there and its data can be extracted so that it can be worked with separately, and the sequencing equipment and processes--at least with Illumina products, which 23andMe use--are the essentially the same. There is no benefit other than clinical/medical to WES, but I've been waiting over four years for some testing company to start opening the doors afforded by WGS. That can lead down the direction 23andMe just announced, but at very close to the same operating cost per test it can also massively increase their reference datasets for genealogical/population genomics and present options for expanding the reporting and comparison services for ancestral and relationship purposes. Whole Exome Sequencing starts and stops with its clinical/medical value.

I wish them luck with it. After all, I still own some stock in the company that I bought shortly after they went public in June 2021 and have sat on because, since November 2021, the price has never again approached that level. It closed yesterday at 77 cents per share.

in The Tree House by Edison Williams G2G6 Pilot (442k points)

2 Answers

+6 votes
As much as I love to read through your answers and comments in regards to topics around WikiTree and genetic genealogy, I think this announcement doesn't have much to do with WikiTree, nor with genetic genealogy as you wrote yourself.

I think there are better places to discuss such a health offering (eg in the Dante Labs and Nebula Genomics Customer group on Facebook).
by Andreas West G2G6 Mach 7 (76.0k points)

Definitely understood. I was conflicted about starting the Question at all. And you aren't alone in your opinion: this earned me my first down-vote in about a year.

On the other hand, I think that most everything that presents a possible impact to the genetic genealogy landscape--just as did 23andMe when it went public via the Branson SPAC, or FTDNA when it was bought by Australian company--is worthy of mention. That this WES product was introduced while 23andMe was in the middle of dealing with all the (pretty remarkable and mostly unfounded) fallout of the security issue could be, I think, an indicator of what may develop as a strategic direction, if it already is not.

In the company's 2024 fiscal year 1st quarter report on August 8, the annualized net loss expectation was raised and the EBITDA remained flat compared the previous quarter, both a deficit of $50 million. The full year adjusted EBITDA deficit is now in the range of $160 to $180 million for FY2024.

Total revenue was down for Q1 by 6%, "primarily driven by lower Consumer Services revenue as we focused on driving improved margins through higher average selling prices and marketing efficiency, reducing advertising spend and discounting windows, resulting in lower volumes of Personal Genome Service (PGS) kit sales and Telehealth orders." Operating expenses were up $25 million over the same period last year, but total revenue was down $4 million, i.e., they spent $25 million more and sold $4 million less. Not good math.

Clearly, the focus now, even before the data access incident, is no longer on genealogy. The status quo there just isn't very profitable at any testing company now that the massive sales surges have flatlined. The 23andMe stock closed yesterday at 74 cents, and is now trading at 77 cents again. And the company has at least a dozen lawsuits filed against it by now, probably more.

There are more appropriate places to discuss changes happening at 23andMe. I'd imagine that few WikiTreers might visit them, though.

And right now I'm not wholly convinced that the segment-detail comparison tools will come back the way they were before. The company's focus and expenditure is going to be on higher-dollar subscription services. And if we stand to lose some or all of the previous genealogy capability at 23andMe, maybe it's good to follow the developments and plan for the future.

+5 votes
Thank you for this information. I always want to know just what testing companies are getting up to, whether I’m not I’m  particularly interested in just what is going on. It is difficult to be encouraged about genetic genealogy’s future at 23 because of this. Based on this announcement, and the restrictions they’ve added, it will certain influence my decisions in the future when looking at the company as a place to test more of my relatives for my research, even if eventually they do relax their restrictions.
by Deborah Outland G2G6 Mach 1 (18.6k points)

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