Yahoo Finance Elizabeth Holmes saga had ‘no’ impact on trust of 23andMe: CEO
Former Defense Secretary Jim Mattis testified on Wednesday in the fraud trial of entrepreneur Elizabeth Holmes, saying that he had been given a false impression about the capability of the blood testing product put forward by her now-defunct company Theranos.
The testimony from Mattis, who sat on the board of the company for three years, is a central part of the prosecution's case characterizing the fallen Silicon Valley star as a savvy operator who misled investors.
Regardless of the trial's outcome, the Holmes saga has already cast a shadow over women-led startups, especially those in the health sector. But it had "no" impact on consumer trust in home DNA test company 23andMe (ME), CEO Anne Wojcicki tells Yahoo Finance in a new interview.
Wojcicki rejected comparisons between 23andMe and Theranos, emphasizing the "science-driven" culture at 23andMe while noting that the outsized attention paid to Theranos owes in part to the gender of its founder.
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"I have a culture of transparent science going back to my [college] thesis on choice and transparency," Wojcicki says. "We are an incredibly science-driven company."
"Theranos was never transparent," she adds. "To be honest, Theranos was new because again, you had a woman who was running it. But there's other companies out there that are also not transparent, that don't get the same kind of publicity."
23andMe, which went public three months ago through a SPAC merger, earned in 2017 the first Food and Drug Administration (FDA) approval for a direct-to-consumer DNA test that revealed a patient's genetic predisposition to certain diseases.
The approval came four years after the FDA sent a warning letter to 23andMe urging it to stop marketing its home DNA tests because the company had not shown sufficient evidence that its product's findings were accurate.
A boom in at-home DNA test sales from 2015 to 2018 culminated with as many customers purchasing such tests in 2018 as did in all previous years, according to an analysis from the MIT Technology Review. But sales of the tests slumped over the ensuing years, causing layoffs at 23andMe in early 2020.
Wojcicki acknowledge that the decline in sales of at-home DNA tests sprung in part from the rise of privacy concerns in recent years, pointing to the Cambridge Analytica scandal in 2018 that showed Facebook (FB) had shared data on millions of users with the consulting firm without their consent.
"We did get hit by things like Cambridge Analytica, and the questions on privacy," she says.
The company has since seen a recovery in the market as COVID-19 "reignited" consumer interest in health care, Wojcicki said.
Wojcicki, who has led 23andMe since its founding in 2006, spent nearly a decade on Wall Street as a health care analyst. Her scientific background dates back at least as far as her college education at Yale University, where she earned a degree in biology.
Speaking to Yahoo Finance, she urged greater transparency in the health sector, including a robust watchdog role for the FDA.
"Heightened scrutiny of all companies, I think is fabulous," she says. "I would encourage there's even more to make sure that people are understanding what exactly is this product that's out there," she says.
"I think this is where the FDA has a real responsibility and a real opportunity to make sure that they're setting standards," she adds.
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