23andMe test kits
Source: Getty Images

Why 23andMe SPAC Could Go Public Any Day Now

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May. 5 2021, Published 2:33 p.m. ET

DNA testing company 23andMe could go public any day now. What can investors expect?

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Earlier this year, it was announced that the genetics company would go public through a merger with SPAC VG Acquisition sometime in the second quarter of 2021. 

On May 4, an amendment was added to the Form S-4 filed with the SEC. This could indicate that the company is one step closer to selling public shares.  

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andme
Source: Getty Images

When 23andMe CEO Anne Wojcicki and VG Acquisitions founder Richard Branson announced the merger deal in February, the genetics company was valued at $3.5 billion. Wojcicki and Branson each invested $25 million into a $250 million private investment in public equity (PIPE) offering, Bloomberg reported. 

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Other investors included Altimeter Capital, Fidelity Management & Research Company LLC, Foresite Capital, and Casdin Capital.

The combined company will trade on the NYSE under the new ticker symbol "ME." 

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In a Feb. 4 interview with Bloomberg, Wojcicki said the influx of new capital would allow the company to expand its efforts to develop therapeutics from genetic data and expand its direct-to-consumer reach.

What is 23andMe?

Founded in 2006, 23andMe is a genetics company that's best known for its in-home DNA testing kits that people use to determine their ancestry. 

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However, the business in that realm has slowed down over the years. The company has been using genetic data for drug therapy. 

Source: YouTube
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According to a company press release, the 23andMe Therapeutics group is pursuing drug discovery programs rooted in human genetics across a spectrum of disease areas, including oncology, respiratory, and cardiovascular diseases, in addition to other therapeutic areas.

In 2018, healthcare company GlaxoSmithKline invested $300 million in 23andMe in a deal to collaborate on drug development. 

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23andMe is the only company to receive clearance from the FDA for over-the-counter health status reports. About 80 percent of 23andMe customers chose to participate in the company’s genetic research.

In January, 23andMe also introduced its COVID-19 Severity Calculator, which is an interactive tool that allows users to see how non-genetic factors might impact their risk of hospitalization due to the virus. The tool looks at factors like age, exercise frequency, and health history. 

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"We have always believed that healthcare needs to be driven by the consumer, and we have a huge opportunity to help personalize the entire experience at scale, allowing individuals to be more proactive about their health and wellness. Through a genetics-based approach, we fundamentally believe we can transform the continuum of healthcare," Wojcicki said in a Feb. 4 press release announcing the merger. 

richard branson
Source: Getty Images

Sir Richard Branson

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What is VG Acquisition?

Virgin Group Acquisition Corp. is a blank-check company founded by billionaire Sir Richard Branson. Branson said that the SPAC looked at “hundreds of companies” before choosing to merge with 23andMe. 

"As an early investor, I have seen 23andMe develop into a company with enormous growth potential. Driven by Anne's vision to empower consumers, and with our support, I'm excited to see 23andMe make a positive difference to many more people's lives,” Branson said. 

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