Celmatix Sues Research Partner 23andMe for $100M

Celmatix Inc. a precision health company advancing the fields of reproductive medicine and fertility at the intersection of big data and genomics, has filed a legal complaint in the New York State Supreme Court for New York County against 23andMe Inc., a research partner of the company. The lawsuit, filed by Pierce Bainbridge on behalf of Celmatix Inc. which seeks declaratory relief and damages in excess of $100 million, is based on 23andMe’s breaches of the parties’ agreement and tortious interference with Celmatix’s efforts to raise capital.
 
Prior to its relationship with 23andMe, Celmatix had established itself as a leader in the female reproductive health space. Its unique data sets, proprietary predictive models, and genomic insights drove the development of many first-of-their kind products in the market, designed to empower women and their physicians to make more informed decisions about fertility and reproductive health. In addition, the company demonstrated a strong commitment to furthering research in the women’s reproductive health community, generating more than 50 presentations at medical and scientific conferences and peer-reviewed journal articles since its 2009 founding.
 
In November 2015, Celmatix entered into a research collaboration with 23andMe designed to advance women’s reproductive health by updating and expanding upon Celmatix’s existing physician-administered genetic test and developing new diagnostic tools that could address a wider market. Celmatix also partnered with 23andMe to conduct an ambitious, first-of-its-kind fertility research community study. More than 4,000 women participated, providing personal health and reproductive information. However, because 23andMe breached its contractual obligations, Celmatix was unable to bring the intended new products to the market. Also, the results of the groundbreaking community study are in limbo pending resolution of the dispute and therefore have not been leveraged to advance women’s reproductive health as envisioned by the parties’ agreement.
 
“Celmatix entered this agreement with 23andMe to further our mission of giving women the insights and tools they need to be proactive about their fertility and reproductive health,” explained Celmatix founder and CEO, Dr. Piraye Yurttas Beim. “While we would have greatly preferred to avoid litigation, we have a responsibility to our investors, to the thousands of women who entrusted their personal information to 23andMe as part of our collaborative study, and to the millions who would benefit from these scientific discoveries and products in reproductive health.”
 
Specifically, by its complaint, Celmatix seeks relief for:
 

• 23andMe’s unjustified breaches of the parties’ contract;
• 23andMe’s bad faith conduct in its performance (and refusal to perform) its obligations under the contract; and
• 23andMe’s tortious interference with Celmatix’s efforts to raise additional capital.

 
Since its launch, Celmatix’s data-driven, science based, solutions-oriented business model has set it apart from many other start-ups and technology-driven companies. Despite the difficulties in tech fundraising experienced by virtually all startups, Celmatix has been successful in raising more than $80 MM due to its leadership position in the growing $50 billion FemTech market and its broad support from the medical fertility community, whose leaders hail Celmatix products as “game-changing.”