Turmoil persists at uBiome with new management overhaul amid FBI probe: reports

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A special committee of the board of directors, formed after the FBI raid, has announced the departure of uBiome's interim CEO as well as the resignations of the company's founders. (Pixabay)

The churn continues among the top executives of the home sequencing test provider uBiome, following an FBI raid on its headquarters earlier this year. According to reports, General Counsel John Rakow is leaving the San Francisco-based company after serving two months as interim CEO.

The FBI’s search in late April followed snowballing investigations by insurance companies and state regulators into the company’s billing practices, over its suite of consumer-focused microbiome tests.

In the days after the raid was made public, uBiome’s board of directors announced that founders and co-CEOs Jessica Richman and Zac Apte would take administrative leave and be replaced by the company’s top lawyer. The board also disclosed that its own special committee would launch an internal investigation. 

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According to Business Insider and The Wall Street Journal, that special committee has now sent a letter to shareholders announcing Rakow’s departure, as well as the resignations of Richman and Apte from the board.

RELATED: CEOs of uBiome take administrative leave following FBI raid

Going forward, uBiome will be managed by three directors from the consulting firm Goldin Associates, which was tapped by the board to review the company’s operations in May. They include Curtis Solsvig as CEO, Robin Chiu as CFO and Karthik Bhavaraju as COO, all in an interim capacity.

RELATED: uBiome grabs $83M, new digs and Joe Jimenez as it expands into therapeutics

According to previous reports, the large insurers Anthem, Aetna and Regence BlueCross BlueShield have been examining the company’s billing practices for its physician-ordered tests—as has the California Department of Insurance—with probes focusing on possible financial connections between uBiome and the doctors ordering the tests, as well as rumors of double-billing for tests using the same sample.  

Last September, uBiome raised $83 million to begin a move into microbiome-based therapeutics, with plans to develop platforms in drug discovery, development and commercialization. It even snagged former Novartis CEO Joe Jimenez for its board.

uBiome’s sequencing offerings include a gut test for wellness and lifestyle; a nasal swab to check for upper respiratory infections; a stool test for conditions such as inflammatory bowel disease, Crohn’s and ulcerative colitis; and a women’s health test that detects sexually transmitted infections, HPV strains and vaginal microbes.

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