NEW YORK – Microbial genomics firm uBiome announced today it has filed for protection under Chapter 11 of the US Bankruptcy Code in Delaware. The firm plans to continue to operate while it undertakes the process of selling off its business, products in development, technology, and lab capabilities, according to a statement.
"We determined that uBiome's business will be better positioned for success under new ownership," said Curtis Solsvig, acting CEO.
The San Francisco-based company has been under scrutiny for billing practices. Founded in 2012 with crowdfunding contributions, last year uBiome was able to raise $83 million in a Series C round. But following an FBI search of the company in April, uBiome suspended its vaginal microbiome and gastrointestinal testing and its co-founders were placed on administrative leave.
The bankruptcy filing allows the firm to preserve the value of its assets for stakeholders and continue to serve current and new customers while it evaluates potential buyers, Solsvig said. "This step builds on the decisive actions the board and new management team have recently taken to stabilize the company and leverage the substantive value of our advanced microbiome testing and analysis assets."
The company will continue to offer its main commercial product, called Explorer, throughout the sale process, it said, and expects to maintain staffing and supply levels to support the product and to process kits.
Explorer is described as "a health and wellness product to understand the role that food and lifestyle can play in wellness." The company will also continue to grow its commercial, academic, and research partnerships.
uBiome has also obtained debtor in possession (DIP) financing from 8VC and Silicon Valley Bank to support its ongoing operations during the sale process, and it plans to complete the intended sale process under Section 363 of the US Bankruptcy Code within roughly 75 days, according to the statement.
Potential buyers will have the opportunity to submit offers to acquire assets associated with the company's product lines, testing labs, intellectual property, and data resources, individually or in combination with one another.
The company's technologies combine patented proprietary "precision sequencing" with machine learning and artificial intelligence to develop wellness products and therapeutic targets. It has filed for over 250 patents, including sample preparation, computational analysis, and molecular techniques, as well as diagnostic and therapeutic applications.Â