DNA Testing Company 23andMe Announces Lay-offs

23andMe, the home DNA-testing company, has announced that it is laying off about 100 people, roughly 14 percent of its workforce. The layoffs were company-wide, particularly impacting its operations teams, which were focused on the company’s growth and scaling efforts. The layoffs did not impact its therapeutics arm, which is developing new drugs through a partnership with U.K.-based pharmaceutical giant GlaxoSmithKline.

At-home DNA test kits have become a popular and accessible way for people to uncover things about their heritage or how prone they are to certain types of health conditions. 23andMe analyzes saliva samples and allows customers to see their family ancestry as well as a map of health risks for certain diseases. Sales of DNA test kits boomed in the United States between 2015 and 2018 and is forecast to reach nearly $2 billion by 2024, up from $930 million in 2019.

Right now, sales for some at-home DNA testing kits, like 23andMe’s, are on the decline. One factor has been the ongoing concerns about DNA testing data being accessed by law enforcement officials used for criminal investigations. Recently, a man said to be the Golden State Killer was arrested after DNA found at the scene of a crime was run through a free online genealogy database and a distant relative to the suspect was uncovered. The case showed how sharing genetic information potentially exposes information about family members. 23andMe was not involved in the Golden State Killer case.

There have also been concerns that DNA results could end up in the wrong hands. In December, the Pentagon sent out an internal memo warning service members against using the take-home DNA kits. Dangers cited included providing false health assessments and concerns about how genetic information can be used for tracking and mass surveillance.

The number of competing companies could also be responsible for the declining sales. In addition to 23andMe, there is AncestryDNA and MyHeritage in the DNA testing and genealogy service industry. Another company, Veritas Genetics, closed its U.S. operations last year. There is also Color Genomics, which focuses on the enterprise market selling to companies, not just consumers.