uBiome may be prime for takeover

Once considered a potential biotech unicorn, uBiome has had a difficult 2019. The company, which specializes in using artificial intelligence to sequence the human microbiome, was as previously reported raided by the FBI in April over accusations of  questionable billing practices and insurance fraud. For example, one customer of the company’s in home testing kit, advertised at $89, reported that their insurance was billed $2,500. Another customer reported their insurance was billed twice. Since the raids, both the company CEO and CTO were placed on leave and many employees were let go.  After a two-month period of an interim CEO from the board, the company recently brought in temporary management from Goldin Associates, a notable turnaround consulting firm. 

In late 2018, the company secured Series C funding at a valuation of $298 million. The top patent holder in the AI Biotech sector, uBiome has been very aggressive with filings, with 144 documents since 2015 – which as of this week includes 49 issued patents. Amidst the internal turmoil, and given that much of its valuation likely comes from its extensive IP portfolio, it would not be surprising to see a takeover attempt from a large pharmaceutical or medical device company looking to grow their AI-related or at-home testing offerings.