23andMe: DNA Genetic Testing For Health, Ancestry And More

Genetic data analysis to revolutionize health

23andMe is a genomics and biotechnology company that provides direct-to-consumer genetic testing services. The company was founded in 2006 with the mission of helping people access, understand and benefit from the human genome.1

Customers can order a testing kit ($99-199) and then send it back to 23andMe labs, after collecting a sample of saliva. In 3 to 5 weeks, they will receive a report based on a genetic analysis that contains health features (health predispositions, carrier status), ancestry features (ancestry composition and timeline) and physical features (i.e. skin pigmentation, hair texture).

Fig.1 23andMe report sample

23andMe creates values for consumers by increasing access to genetic testing, a practice that previously required expensive and time-consuming medical visits and referrals.

Nevertheless, with the expansion of its database, 23andMe developed new ways for value creation by leveraging genotypic and phenotypic data for scientific research. 23andMe wasn’t the first to think of building a database for this purpose, but using consumer DNA kits as an input soon gave the company a massive competitive advantage (The only bigger known databases belong to Ancestry.com and the Chinese government).3

“I thought it was genius actually, that people were paying us to build the database,”

– Richard Scheller, 23andMe’s chief scientist.

23andMe journey toward pharmaceutical research started with giving users the possibility to opt-in to have their genetic data used for research. On average, 80% of users choose to contribute. If the user chooses to opt-out, the data is discarded after 30 days.4

Data generated by sample analyses can thenbe used by the 23andMe therapeutics division with the goal of:

– Improving drugs’ target selection and development of targeted medicines

– Identifying patient subgroups that are more likely to respond to specific treatments

– Identifying and recruiting specific target populations for clinical studies.

Hence, the company moved away from primarily being known for its testing kits on ancestry and health risks, and entered the more lucrative field of drug research and development. The use of genetic data, especially in the first phases of drug discovery, can play a key role in the way toward drug approval. Previous studies showed that only about 13% of new molecular candidates for drug trials are traditionally approved, and introducing genetic support can nearly double the potential for approval.5

To enter the complex pharmaceutical market and develop capabilities, 23andMe initially started collaborating with pharma giants. In 2015, a collaboration with GSK was started with the goal of combining 23andMe data science skills with GSK’s drug discovery and development capabilities. Since then, 23andMe has been sharing insights from customer data with other pharmaceutical companies, making access to its customer information an essential part of its business model.6

Progressively, 23andMe developed its internal capabilities and started developing candidate drugs with potential use in treatments for neurological, cardiovascular, and other conditions. In January 2022, 23andMe announced the launch of a clinical trial for its first drug developed entirely in-house. It is an immune-oncology antibody aimed at treating solid tumors.3

Nevertheless, the use of genetic data of millions of people has raised ethical concerns. 23andMe claims user data is only shared when anonymized and in aggregate, unless customers separately agree to have their anonymized data shared individually. The company’s privacy statement also addresses the use of data in case of a merger. In that case, customer data “would remain subject to the promises made in any pre-existing privacy statement”. Nevertheless, even though 23andMe explicitly prioritizes consumer privacy, the risk of a security breach could have relevant consequences. Incidents at other DNA companies show this risk is not low: in 2019 a breach of GEDmatch database, a genealogy website, exposed the DNA data of more than 1 million people.7

In the recent past, 23andMe has further broadened its interest in the healthcare industry, aiming at applying the insights from its genomic database to healthcare delivery, specifically to primary care. In October 2021, 23andMe Holding Co. announced the acquisition of Lemonaid Health.8 Lemonaid Health is a leading innovator in telemedicine and prescription drug delivery. 23andMe will train Lemonaid doctors in how to integrate 23andMe genetic risk reports into care. This will help determine which treatments are likely to work best for each patient. The acquisition is aligned with 23andMe’s goal to provide truly personalized healthcare, with extensive genetic data analytics as the foundation.

“We’re not just a genetics company.
We’re not just a health company;
we’re not just ancestry; we’re all of these things.”

– Anne Wojcicki, CEO of 23andMe


1.        About us – 23andMe. Accessed March 24, 2022. https://www.23andme.com/about/

2.        Stoeklé HC, Mamzer-Bruneel MF, Vogt G, Hervé C. 23andMe: A new two-sided data-banking market model. BMC Med Ethics. 2016;17(1):1-11. doi:10.1186/S12910-016-0101-9/FIGURES/5

3.        23andMe to Use DNA Tests to Make Cancer Drugs – Bloomberg. Accessed March 24, 2022. https://www.bloomberg.com/news/features/2021-11-04/23andme-to-use-dna-tests-to-make-cancer-drugs

4.        How It Works. Accessed March 24, 2022. https://medical.23andme.com/how-it-works/#submit-sample

5.        Nelson MR, Tipney H, Painter JL, et al. The support of human genetic evidence for approved drug indications. Nat Genet. 2015;47(8):856-860. doi:10.1038/NG.3314

6.        GSK and 23andMe sign agreement to leverage genetic insights for the development of novel medicines | GSK. Accessed March 24, 2022. https://www.gsk.com/en-gb/media/press-releases/gsk-and-23andme-sign-agreement-to-leverage-genetic-insights-for-the-development-of-novel-medicines/

7.        Why a Data Breach at a Genealogy Site Has Privacy Experts Worried – The New York Times. Accessed March 24, 2022. https://www.nytimes.com/2020/08/01/technology/gedmatch-breach-privacy.html

8.        A Letter from Anne: Making Personalized Healthcare a Reality – 23andMe Blog. Accessed March 24, 2022. https://blog.23andme.com/news/23andme-to-acquire-lemonaid-health/


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Student comments on 23andMe: DNA Genetic Testing For Health, Ancestry And More

  1. (This comment is from Kevin Lam) • Sebastiano – 23andMe: Thank you for this very informative post Sebastiano! This value creation is so interesting and is definitely a newer edge of medication development. I wonder how the company will also capture additional value in the future with regulatory bodies introducing policies prohibiting using genetic data to influence insurance policies/health plans and restricting overall genetic data use.

    1. I really enjoyed reading this post! I never would have thought about this particular angle of business innovation from the organization, though it’s cool that they already have a candidate for a clinical trial. Given that they’re data allows them to particularly target personalized medicine, it seems to me that the organization is almost better suited to partner with doctors and insurance organizations rather than drug development (with a heavy caveat that I know very little about drug development).

  2. Thank you so much for the sharing, Sebastiano! I see 23and me is now more like a genetic data mining company. People can do so many things with DNA data, I think 23andme even allows people to download their dataset? I always wonder if genetic technology can be along with sensorization and wearable devices for health prediction for heart attacks, stroke, or dementia, etc. Truly hope what asset 23andme has been collecting over a decade can eventually conduce to the development of manunkind.

  3. Really enjoyed this post and kind of agree with the founder – it’s brilliant that their consumers are helping them build the database (which is similar to the company I wrote about as well)! It seems like there’s a lot of scope for both value creation and capture since there could be a lot of revenue streams from this (regulation permitting). I’m curious though if they’ve thought about the misuse of this information – especially in the vein of misuse of information to marginalize certain racial communities or individuals based on test results/patterns. Although it does seem like it could be used for a lot of good and myth-busting as well.

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