The financial stakes for dominating the global biotech sector — the industry that's bringing us the COVID vaccine — are staggering, estimated to be worth up to $4 trillion a year. For perspective, that's more than the valuation of Amazon and Apple combined. Not surprisingly, many U.S. companies want a piece of that pie and recognize that control over the future of health care lies in collecting and then analyzing massive quantities of data. So, like China, they too are building up vast libraries of health information. There are undeniable benefits to this — potential cures and treatments, some already in use. But there's also a darker truth buried in the fine print: companies, including some of the ones that sell those popular genealogy test kits, could profit off of consumers and their private medical data.
Bill Evanina: Sometimes Americans or people around the globe don't even know the value of their DNA, that-- that it even has value. But it's your single, sole identifier of everything about you as a human being.
Bill Evanina just stepped down as the top counterintelligence official at the directorate of national intelligence.
Jon Wertheim: I'm a victim of identity theft, I can get a new Visa or AmEx. You get my genetic identity, I don't have a backup.
Bill Evanina: That's correct. So it's your past and your future as well as your children's future.
Jon Wertheim: So in recent years, millions of Americans have given away their DNA for ancestry searches. Is that risky?
Bill Evanina: It's very risky and I think the unknown is probably the riskiest part.
So risky in fact that the U.S. military recently issued a warning to all service members, instructing them not to use direct-to-consumer genealogy tests like those offered by Ancestry, 23andMe and other companies. Quote. "These... genetic tests are largely unregulated and could expose personal and genetic information… Outside parties are exploiting the use of genetic data."
Bill Evanina: The Department of Defense issued that proclamation saying, "Please do not use these genetic services because we are not comfortable yet as a government to understand where that genetic data goes."
If it's bad for the military, we wondered why there are not government warnings to American consumers. Already an estimated 50 million Americans have paid a small fee and sent in their saliva, hoping for clues to what country their ancestors came from, relatives they may not know they have, or some other information about their health. Genealogy firms are selling us on the use of DNA as a consumer product. But supervisory special agent Edward You of the FBI says what they are really selling us is something else entirely.
Edward You: The return on investment is aggregating the data and what they can do with it once they have enough of it.
Jon Wertheim: You're saying these-- these genealogy companies-- the real value is everything you can do with this data set?
Edward You: The value is in the data. It-- it's not just the genealogy companies. Everybody is looking at what kind of data do I have access to, how much do I have, and then how can I turn around and-- and monetize it.
Jon Wertheim: That's where the money is?
Edward You: Absolutely.
For example, just this past week, 23andMe was reported to be in talks to go public, with a valuation of $4 billion. It's a common refrain in the world of biotech: data is the new oil -- and it's all types of health data that might come from your smart-watch, your social media, your credit card.
UC-Davis professor of law Lisa Ikemoto specializes in bioethics, and is studying how the new market for DNA and health data is taking shape.
Jon Wertheim: It seems like a bit of a bait and switch. We pay 100 bucks, whatever it is, for our ancestry reports. And then they actually wanna turn around and sell our genetic data.
Lisa Ikemoto: That's what's being hidden. That you're allowing your personal information to be used by others. And that information's being transferred to third parties. And it's being for uses that you never imagined.
Professor Ikemoto is skeptical about whether true informed consent is being granted when we provide our DNA and points out that most customers click 'yes' giving permission for their data to be used for research. But Ikemoto wonders if they realize what that really means.
Jon Wertheim: We printed out the privacy forms for 23andMe and Ancestry. And this, I mean, this is just a blizzard of paperwork. And fine print. Does anyone read these things?
Lisa Ikemoto: We're so used to filling out, sort of, scrolling through these long documents online to upload the app or whatever it is and then just clicking the 'I agree' button at the end.
Jon Wertheim: This is an Ancestry form. "You grant royalty-free worldwide sub-licensable transferable license to host, transfer, process, analyze, distribute and communicate your genetic information." What does that mean in English?
Lisa Ikemoto: (LAUGH) I think you're giving up all rights. (LAUGH) And any potential commercial interest in the use of your DNA by AncestryDNA.
Jon Wertheim: Who are they selling the data to? Who are the buyers here?
Lisa Ikemoto: Most of the genealogy companies are partnering with pharmaceutical companies, biotech startups, established research institutions.
Ancestry declined our interview request and said "Ancestry does not sell consumer DNA data" and "we do not have any for-profit research partnerships." Genealogy companies told us that the data they do share for research is made anonymous and that the research is a force of good. But with those third party agreements to study disease and develop treatments can come investment dollars.
Jon Wertheim: 23andMe has a partnership with GlaxoSmithKline, $300 million dollars to develop drugs based on this DNA. Is that a good thing or a bad thing?
Lisa Ikemoto: They might produce something very useful. In that sense, it's good. It means that 23andMe and GlaxoSmithKline will make a huge amount of money. The people who provided all the cells and tissues or DNA that's being used will make none. They'll be probably charged a lot of money (LAUGH) for the drugs if they ever need them.
Jon Wertheim: So we're providing the raw materials to create this product and then we have to pay for the product?
Lisa Ikemoto: Yeah, that's exactly right. People are now being mined for their raw materials. It raises concerns about what it means to be human in this world.
Anne Wojcicki: From the foundation of the company, we have always said, "If our customers can't trust us, we don't have a business."
CEO and founder of 23andMe Anne Wojcicki says her customers are making a conscious decision to contribute their DNA for the benefit of society.
Anne Wojcicki: When we started the company we sat down with the leading privacy experts. And what they taught me was that, "Anne, privacy doesn't mean that your data's not shared anywhere." It means that we have choice.
Jon Wertheim: What percent of your customers are opting in and then saying, "Go ahead. Use my DNA for your research?"
Anne Wojcicki: Over 80% of our customers opt in.
Jon Wertheim: But you're still choosing how and when and where their data is being used.
Anne Wojcicki: We give people, so for instance, we have entered into a large collaboration with-- GlaxoSmithKline for therapeutic development. When we did that, we specifically emailed all of our customers. And we gave them the opportunity to either opt into research or to opt out of research.
Jon Wertheim: But this idea that the value of this company is in the data. This is where the real growth potential is. Your chief scientist said, "It's genius. People were paying us to build databases."
Anne Wojcicki: What we have done is we have empowered individuals with this opportunity to come together, to crowd source research. And I absolutely stand behind: we are going to develop drugs. So that everyone is actually benefiting from the human genome. So absolutely the data is valuable.
Jon Wertheim: I want to keep pushing you on this point. You're relying on the kindness of strangers. You're not paying 'em. They don't have a stake in potential profits. Is that a fair exchange?
Anne Wojcicki: I believe our customers feel that that-- the-- the number one thing that we can do that is going to benefit them is the end result, which is: the end result is actually develop a drug.
That's a long way from learning more about your family's country of origin. And though they are using our DNA—what is essentially our barcode—for drug development, genealogy firms like 23andMe are not subject to HIPAA regulations. But Wojcicki asserts her company's privacy policies are stronger than HIPAA, anyway. Other federal laws about the security of our data? They are patchwork and incomplete, according to Lisa Ikemoto.
Jon Wertheim: This message of trust us, what's your response to that?
Lisa Ikemoto: Given 30 years of research, I'm not willing to give my trust to the biotech industry. I think it's probably true that the researchers who do this work have the best intentions, in most cases. But that doesn't mean that I can't be exploited in the process.
And then there's the issue of security. Multiple consumer genealogy firms have been targeted by hackers in the past few years, putting our DNA data at risk. Both Ancestry and 23andMe told us they have not been breached.
Jon Wertheim: You agree the possibility of a hack is a serious, serious concern?
Anne Wojcicki: Anyone who tells you that a hack is not possible is lying. And so I have to make sure I'm doing everything that is reasonably possible on data security. And that I'm doing everything I can with transparency to make sure you trust us and that you are never surprised.
But you may be surprised about another potential security risk: how much money foreign firms, particularly Chinese, are investing into U.S. companies that collect our biodata, according to former intelligence official Bill Evanina.
Bill Evanina: So the amount of effort that the Chinese government has put into investing in companies in the U.S., current estimates are 23 Chinese-based or affiliated companies are operating inside the U.S. in consultation, collaboration, partnership, investment with U.S.-based companies.
China's reach has gotten so vast, it's drawn the attention of a little known but increasingly busy branch of the Treasury Department, the Committee on Foreign Investment in the United States — or CFIUS. Among its duties: sniffing out suspicious business deals. Just a few months ago, a Chinese firm was set to buy a San Diego fertility clinic. In part because the fertility clinic is located near six U.S. military bases, CFIUS blocked the sale before it could take place.
Bill Evanina: What if that fertility clinic sells all their capabilities and data to a company in China? All that data's gone. So all that capability of your unborn fetus, are now owned and operated by the Chinese company.
In other words, the company could have had access to the DNA not just of U.S. soldiers but of their unborn babies. Evanina also expressed his concern to us that 23andMe has some Chinese investors.
Bill Evanina: We know there's an investment in the Chinese company in 23andMe. What we don't know is, is there is a data sharing agreement with that company or not?
We asked 23andMe CEO Anne Wojcicki. She told us that the Chinese investors have no access to the genetic information of the company's customers. But she does agree with Bill Evanina on one critical point, the Chinese threat to U.S. biotech is real and it's no exaggeration to say our future might depend on how we address it.
Anne Wojcicki: What I've been most worried about, frankly, is that China is very publicly stating that they wanna win in the genetic information revolution. We need to be super vigilant about China, you know-- you know, with any kind of data. But the issue is more that China is putting billions of dollars into their own genetic programs and we are not.
Jon Wertheim: Why aren't we investing like this?
Anne Wojcicki: It's leadership. I need leadership at the top to say, "We need to have these types of large programs." I absolutely share the concern that the United States is underfunding genetic research. And I think that if we want to win the biotech genome revolution we need to start funding it.
Produced by Oriana Zill de Granados and Emily Gordon. Broadcast associate, Elizabeth Germino. Edited by Robert Zimet.