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Summary:

23andMe is in hot water with the FDA, which has urged the startup to shut down sales of its $99 genome kit.

dna strand
photo: Thinkstock

23andMe has made a name for itself providing a service many people didn’t even know they needed: a complete DNA profile, including risk percentages for diseases such as Parkinson’s and Alzheimer’s. But the FDA is putting a stop to the sales of the $99 kit that has made the company so successful, according to Bloomberg.

Since being founded in 2006, 23andMe has amassed more than $161 million in funding over four rounds, largely due to the vote of confidence the company received from Google. The relationship, of course, is no secret — 23andMe was started by Anne Wojcicki, Google founder Sergey Brin’s (now estranged) wife and the sister of long-time Google executive Susan Wokcicki. Still, it has proven to be attractive for other investors as well, garnering $50 million in Series D funding in 2012.

But the company’s run-in with the FDA could threaten the entire business, as the government group has sought to punish 23andMe for promoting health benefits without approved to do so. In an extensive warning letter, the FDA urged the startup to “immediately discontinue” the sale of its $99 saliva-based genome testing kit, citing ignored recommendations and incomplete testing that make it impossible for the government group to identify whether the process is accurately profiling DNA.

According to Bloomberg, 23andMe submitted applications to the FDA twice in 2012 for the least stringent approval processes for medical devices, but the approval has been stalled due to lack of significant evidence. As the product claims to evaluate a consumer’s risk for disease, it needs FDA approval to keep its doors open.

23andMe has yet to respond to the open letter, but it will be interesting to see how the company plans to wiggle its way to FDA approval while continuing to sell and administer tests. It’s certainly not the first startup to bump up against regulations — Airbnb and Uber are two lightning rod examples of the government putting the brakes on a Silicon Valley startup. But there is a chance that it could become the red-tape poster child for other medical startups seeking to hack healthcare.

  1. Oh, @lhockneson please, why don’t you add that Michael Taylor is stadtholder at FDA from Monsanto, that FDA is less and less government agency and more and more is puppet in hands of Monsanto and Co?

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  2. The FDA is doing exactly what we need them to do. 23andMe has always flouted rules that are there to protect the public from hyped up health claims.

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  3. Comments for better articles Monday, November 25, 2013

    “citing ignored recommendations and incomplete testing that make it impossible for the government group to identify whether the process is accurately profiling DNA.”

    How about highlighting which recommendations were ignored that allegedly make impossible to identify whether the process is accurately profiling DNA? Also what does incomplete testing in this case mean?
    Are the tests they are performing are not accurate? Or that the FDA want them to test every possible genetic health related issue?

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  4. Looks like they are still selling them. Wonder if/when they’ll stop?

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    1. They won’t stop … the FDA will just force them offshore.

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  5. The only good way to stop them doing “wrong/incomplete/inaccurate” things (if they do?) is to have another company do it better. If they are not so good, there will be a better competitor and we will all benefit. Dont stop progress….

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  6. @sipol the reason @lhockneson committed an act of omission by omitting information about the Taylor / Monsanto relationship and why the FDA is a puppet of U.S. special interests groups (Monsanto and Co.) is because GigaOm makes money by writing articles about S.F. Bay area tech companies and their incestuous relationships. 23andMe isn’t the only one with close ties to Google. Take for example the coverage on “The Climate Corporation” (aka “WeatherBill”) based in S.F.. Who were among Climate Corp’s VC investors? Why none other than palsy walsy Google Ventures. Monsanto recently acquired Climate Corp for about $1B USD (all cash deal) and apparently Climate Corp. had been shopping itself around for an acquisition, probabilistically because they were burning too fast through their deep pocketed VCs money. Probabilistically their cash inflows were not enough to make them cash flow positive aka “profitable”. Heh, at the end of the day, the VCs after several series rounds usually and probabilistically end up calling the shots, pound their fists on the table and yell “where’s my exit?”. GigaOm also writes quite a bit about Amazon’s cloud (AWS) and Climate Corp has in the past bragged about being among AWS’s top five customers. Well, imagine the monthly AWS rental *bill* (speaking of Weather*Bill*) due to landlord Jeff Bezos! Did GigaOm ever asked Climate Corp what their monthly AWS rent was / is? Well, forget the notion of investigative journalism in this day and age when stories like these provide “journalists” things to write about without telling the real story, eh? Bring on 60 Minutes!

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  7. This is a far reaching thing. How many criminals are going to be let go because of DNA testing like this? What are they thinking?

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  8. Where can send my money to help these people fight the FDA!!???

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