Invitae: Genetic Testing Company Sold to Labcorp for $239 Million

Invitae Corporation filed chapter 11 on February 13, 2024 in the U.S. Bankruptcy Court, District of New Jersey to run a court-supervised sale process for its medical genetics and data services business. Senior secured noteholders signed a transaction support agreement to back the process, and the company described itself in court filings as a medical genetics company providing genetic testing, digital health solutions, and data services through proprietary automation and bioinformatics platforms - First Day Declaration. The company had also attracted prominent investors, including SoftBank Group Corp. and Ark Investment Management, as reported in a Bloomberg report.

In the voluntary petition, Invitae reported estimated assets of $500,000,001-$1 billion and estimated liabilities of $1,000,000,001-$10 billion - Voluntary Petition. The case moved quickly through early milestones, including cash collateral authority and bidding procedures, with the sale process culminating in an April 17 auction and a May 7 sale order approving Labcorp as the winning bidder - Bid Procedures Order; Sale Order. A sale approval release described the $239 million cash bid and a going-concern acquisition, while the sale order referenced approximately $242.3 million in sale proceeds - Sale Order.

Debtor(s)	Invitae Corporation
Court	U.S. Bankruptcy Court, District of New Jersey
Case Number	24-11362
Judge	Hon. Michael B. Kaplan - Voluntary Petition
Petition Date	February 13, 2024 filing announcement
Estimated Assets	$500,000,001-$1 billion - Voluntary Petition
Estimated Liabilities	$1,000,000,001-$10 billion - Voluntary Petition
Monthly Cash Burn	About $9-10 million cash burn estimate
Auction Date	April 17, 2024 - Bid Procedures Order
Sale Order Date	May 7, 2024 sale approval release
Buyer	Labcorp Genetics Inc. buyer selection
Sale Price	About $239 million cash plus non-cash consideration sale price

Restructuring Overview

Invitae entered chapter 11 with a strategy centered on a sale process supported by its senior secured noteholders. The transaction support agreement committed the noteholders to the sale process and to voting in favor of a plan after a sale, establishing a creditor-backed framework from day one. The court granted authority to use cash collateral, and the orders required weekly or bi-weekly reporting, a 12.5% negative variance limit in the budget, and a minimum liquidity threshold of $56.7 million - Cash Collateral Motion; Final Cash Collateral Order. Those controls defined the liquidity guardrails for the debtors while the sale process ran.

The bidding procedures order set the key milestones and deadlines. The court approved an auction date of April 17, 2024 at 10:00 a.m. ET, set a sale objection deadline of April 29, 2024 at 4:00 p.m. ET, and scheduled the sale hearing for May 6, 2024 at 10:00 a.m. ET - Bid Procedures Order. Those dates created a compressed timeline between the February filing and the May sale order.

At the sale hearing, the court approved the sale of select assets to Labcorp Genetics Inc. and authorized the debtors to enter into the asset purchase agreement - Sale Order. The company described the transaction as a going-concern sale in its sale approval release, while a later filing referenced approximately $242.3 million in sale proceeds and a reverse transition services agreement structure for collecting and remitting accounts receivable - Sale Order. The sale outcome set the base for a plan process that could address remaining claims and wind-down matters.

After the sale order, the debtors filed a joint plan and disclosure statement on May 9, 2024 and later filed a second amended joint plan on July 19, 2024 - Joint Plan of Reorganization; Disclosure Statement; Second Amended Joint Plan. The plan structure and class treatment are covered in detail below, but the overall case posture moved from a going-concern sale to a plan-based wind-down for residual assets and claims resolution.

Early in the case, the court entered an interim cash collateral order on February 16, 2024 and a final cash collateral order on March 18, 2024, authorizing the debtors to use cash collateral while the sale process proceeded - Interim Cash Collateral Order; Final Cash Collateral Order. Those orders set the operating budget framework and established reporting requirements that governed day-to-day liquidity use during the marketing period. The debtors also secured a bid procedures order on February 16, 2024, locking in the auction date and sale hearing schedule within days of the petition date - Bid Procedures Order.

The sale order was the central milestone in the restructuring strategy. The order approved the sale of assets to Labcorp Genetics Inc. free and clear of liens, claims, and encumbrances and authorized the debtors to enter into and perform the asset purchase agreement - Sale Order. That structure placed the primary value realization in the sale process rather than a standalone operating reorganization, with the plan process designed to distribute sale proceeds and address remaining claims.

Company Background and Business Lines

Invitae described itself in court filings as a medical genetics company that provides genetic testing, digital health solutions, and data services to clinicians and health systems - First Day Declaration. The business focused on hereditary cancer testing, rare disease diagnostics, and personalized cancer monitoring, supported by proprietary automation systems and bioinformatics platforms - First Day Declaration. The services are designed to collect genetic information, analyze it through bioinformatics pipelines, and deliver clinical reports for patients and providers, with additional data services layered on top of the testing workflows - First Day Declaration.

The company also framed its platform as a combination of wet lab infrastructure and software-enabled analytics. That combination matters in bankruptcy because the asset base spans physical laboratory operations, software platforms, data assets, and commercial relationships with health systems. The First Day Declaration emphasized that Invitae built automation systems and bioinformatics tools to support scale and turnaround time, while continuing to offer a broad test menu across oncology, rare disease, and other clinical areas.

A simplified view of the business lines at the time of filing is summarized below.

Invitae's scale and market presence were also visible in its investor base and public market history. A Bloomberg report noted backing by SoftBank Group Corp. and Ark Investment Management. Those investors were part of the company's growth phase, but the post-pandemic environment for genetic testing firms became more challenging, setting the stage for a focus on liquidity and restructuring.

Invitae emphasized that its platform combined laboratory infrastructure with software and data capabilities. The First Day Declaration highlighted proprietary automation and bioinformatics systems designed to manage test volume, interpret genetic variants, and deliver clinical reports - First Day Declaration. The service categories also show a broad test menu across oncology and rare disease, alongside digital health solutions and data services that depend on ongoing clinical relationships rather than one-time product sales - First Day Declaration. That mix helps explain why the sale process targeted a going-concern buyer that could operate the laboratory business and integrate data and software assets.

Prepetition Performance and Industry Backdrop

Invitae entered chapter 11 after years of operating losses and declining equity value. MedTech Dive reported that the company never turned a profit since its 2012 founding and posted a net loss of $1.34 billion for the first nine months of 2023. The same report tracked the stock price from a 2015 IPO at $17.80, a 2020 peak of $56.60, and a February 2024 price of $0.019. MedTech Dive also noted that NYSE initiated a delisting process because of the abnormally low price.

The sector backdrop was also a factor. The same coverage described how the DNA testing industry struggled to regain investor interest after the pandemic-era boom, and Bloomberg similarly pointed to the post-pandemic slowdown in genetic testing investments in its chapter 11 coverage. Those market conditions provide context for why Invitae's liquidity runway narrowed even as it maintained a broad test menu and technology platform.

Liquidity pressure was visible in burn-rate disclosures. MedTech Dive reported that Invitae was burning about $9-10 million per month, a pace that made near-term financing and asset sales critical for operations.

Management Statements and Prepetition Strategy

Invitae's public statements around the filing emphasized debt reduction and a sale-driven restructuring. CEO Ken Knight said the company still needed to address its debt position, framing the chapter 11 case as a balance-sheet restructuring rather than a change in the core business model. The filing followed 18 months of cost management and portfolio realignment, indicating that prepetition actions focused on expense reductions and business adjustments before entering court-supervised proceedings.

The transaction support agreement and advisor lineup reinforced that the restructuring was structured around a negotiated sale process and a plan supported by key creditor constituencies. Those statements help explain why the case moved quickly into a formal auction timeline and why the plan documents appeared shortly after the sale order. The debtors positioned the filing as an orderly process to monetize assets and resolve debt through a controlled sale rather than a protracted standalone reorganization.

Equity Market History and Investor Base

Invitae's public market performance provides additional context for the bankruptcy filing. MedTech Dive reported that the company went public in 2015 at $17.80 per share, reached a 2020 peak of $56.60 during the pandemic-era boom in genetic testing, and fell to $0.019 per share by February 2024 stock price history. That trajectory reflects a steep decline from peak valuations to a level that triggered exchange compliance issues.

The same coverage noted that the NYSE initiated a delisting process due to the abnormally low price. Bloomberg's coverage highlighted that Invitae was backed by SoftBank Group Corp. and Ark Investment Management, indicating that high-profile investors had supported the company during its growth phase investor backing. Together, the market performance and investor context frame the filing as a case that moved from growth-capital expectations to a sale-driven wind-down.

Capital Structure and Liquidity Framework

The petition listed estimated assets of $500,000,001-$1 billion and estimated liabilities of $1,000,000,001-$10 billion - Voluntary Petition. The plan documents identify the 2028 Senior Secured Notes as a separate impaired class, underscoring their role as a primary funded debt instrument in the capital structure - Joint Plan of Reorganization. Other secured and priority claims were treated as unimpaired under the plan, indicating the debtors expected those categories to be paid in full under the plan terms - Joint Plan of Reorganization.

With no new DIP facility announced, Invitae relied on cash collateral authority and a structured budget to operate during the sale process. The cash collateral motion required a 12.5% negative variance limit on receipts and disbursements and a minimum liquidity threshold of $56.7 million, with weekly or bi-weekly reporting to lenders - Cash Collateral Motion. The final cash collateral order continued those constraints and granted superpriority claims and liens as adequate protection for the secured parties - Final Cash Collateral Order. Those terms signaled that liquidity management during the auction process was a core case priority.

Cash Collateral Mechanics and Liquidity Monitoring

The cash collateral framework is one of the most detailed sources of operating information in the docket. The debtors were required to operate within a 12.5% negative variance for both total receipts and total disbursements during each test period, with weekly or bi-weekly reporting to the secured parties - Cash Collateral Motion. A minimum liquidity requirement of $56.7 million set a hard floor on available cash and reinforced the short runway described in press coverage cash burn estimate - Cash Collateral Motion.

These provisions are common in cash collateral orders but particularly important in a sale-driven case. A variance test effectively restricts the debtors from exceeding budgeted expenses or falling short on expected receipts without consent, while the liquidity covenant forces immediate attention to any drop in cash. The final order also granted superpriority claims and liens as adequate protection for secured parties, confirming that the debtors could use cash collateral only in exchange for enhanced creditor protection - Final Cash Collateral Order. Those terms shaped the operating runway available to complete the auction process and execute the sale.

Adequate protection in the final order included superpriority claims and liens on substantially all assets, reinforcing the secured parties' priority position as the debtors used cash collateral to fund operations - Final Cash Collateral Order. In practical terms, those protections meant that operating draws and sale-related expenses were paired with enhanced collateral rights for lenders, and the budget monitoring ensured visibility into cash use. The combination of a strict variance test, liquidity floor, and adequate protection package indicates a case in which preserving sale value was central to the restructuring plan - Cash Collateral Motion.

Transaction Support Agreement and Advisors

The sale process was paired with a transaction support agreement with senior secured noteholders. The agreement framed the case as a negotiated path to a sale and subsequent plan, reducing uncertainty for the estate and signaling that the largest funded creditor group supported the process. That alignment is often critical in a sale-driven chapter 11, where a quick timeline can limit the number of competing bidders.

The same announcement identified the debtor's professional advisors: Kirkland and Ellis LLP as lead counsel, Moelis and Company LLC as investment banker, and FTI Consulting as financial and communications advisor advisor lineup. The investment banker role typically centers on marketing the assets, assessing bids, and structuring the transaction process, while legal counsel and financial advisors manage court approvals, stakeholder negotiations, and operational communications. These roles matter for creditors because the advisors help translate the sale outcome into a plan framework that defines recoveries for each class.

The advisor lineup points to a structured sale process. An investment banker typically prepares marketing materials, coordinates outreach to potential buyers, and evaluates bids against valuation and execution criteria, while lead counsel manages the sale motion, the asset purchase agreement, and related court approvals. A financial and communications advisor often supports liquidity analysis, budget management, and stakeholder messaging to employees, customers, and counterparties. The use of specialized advisors is consistent with a case that needed to preserve operating continuity while running an auction on a short timeline advisor lineup.

On the buyer side, Labcorp engaged Citi as financial advisor and Hogan Lovells and Kilpatrick Townsend as legal counsel, as disclosed in the sale approval release. The buyer's advisory structure underscores that the transaction involved complex asset transfers, regulatory considerations, and integration planning beyond a simple asset purchase. The presence of advisors on both sides supports the conclusion that the sale was a core strategic transaction rather than a distressed liquidation of discrete assets.

Sale Process and Labcorp Transaction

The bidding procedures order established the sale framework only three days after the filing. The order set the auction for April 17, 2024, required objections by April 29, and scheduled the sale hearing for May 6 - Bid Procedures Order. That structure created a rapid transition from filing to auction, with limited time for competing bids to emerge.

Press coverage described how Labcorp emerged as the winning bidder. MedCity News reported that Labcorp was selected at the auction to acquire Invitae's genetic testing services, digital health solutions, and health data services. Fierce Biotech noted that the acquisition strengthened Labcorp's genetic specialty testing with a focus on oncology and rare diseases. MedTech Dive reported that Labcorp estimated annual revenue of $275-300 million from the assets, highlighting the commercial value of Invitae's testing platform and customer base.

The court entered the sale order on May 7, 2024, authorizing the debtors to proceed with the asset purchase agreement sale approval release. In the company release announcing the approval, Invitae described a purchase price of $239 million in cash plus non-cash consideration and said the acquisition would occur on a going-concern basis. That release also identified Labcorp's advisors as Citi (financial) and Hogan Lovells and Kilpatrick Townsend (legal) advisor listing.

The sale approval release said the transaction was expected to close in the third quarter of 2024, underscoring the speed at which the estate intended to transfer operating assets and stabilize the business under new ownership expected closing. Press coverage characterized the acquisition as a strategic move to expand Labcorp's oncology and rare disease testing footprint, which aligns with Invitae's core test menu and data services strategic focus.

The sale order referenced approximately $242.3 million in sale proceeds and noted a reverse transition services agreement structure for collecting and remitting accounts receivable - Sale Order. The reverse TSA arrangement indicates that cash collection mechanics and ongoing operational support were negotiated to allow a clean handoff of receivables while the debtors moved toward a plan-based wind-down.

The transaction closed against the backdrop of a market that had shifted away from earlier enthusiasm for standalone genetic testing companies. Invitae's sale represented a consolidation move by a large laboratory operator rather than a standalone recapitalization. The combination of a going-concern sale and a later plan process positioned the remaining estate to focus on claim reconciliation and other wind-down steps rather than ongoing operations.

Plan Structure and Case Status

The debtors filed a joint plan of reorganization and disclosure statement on May 9, 2024 - Joint Plan of Reorganization; Disclosure Statement. The plan divided claims and interests into multiple classes, with Class 1 (Other Secured Claims) and Class 2 (Other Priority Claims) treated as unimpaired and paid in full - Joint Plan of Reorganization. Class 3, the 2028 Senior Secured Notes Claims, was impaired and entitled to share in distributable value after priority claims - Joint Plan of Reorganization. Class 6, Parent Unsecured Claims, was impaired and entitled to residual value after Classes 1 through 5 - Joint Plan of Reorganization. Classes 9 and 10 were impaired and slated to receive no distribution, and intercompany claims and interests were reinstated or cancelled as specified in the plan - Joint Plan of Reorganization.

A second amended joint plan was filed on July 19, 2024 - Second Amended Joint Plan. The docket also reflects continued claims administration activity, including omnibus objections, which is consistent with a plan-driven wind-down process rather than continued operating reorganization. The available plan documents show a structure aimed at distributing sale proceeds and resolving remaining claims while aligning creditor treatment with the sale-based outcome.

Post-Sale Estate and Claims Administration

After the sale order, the plan process became the primary mechanism for distributing proceeds and resolving remaining claims. The joint plan and disclosure statement laid out class treatment for secured, priority, and unsecured claims, with impaired classes bearing the residual risk after the sale proceeds were applied - Joint Plan of Reorganization. The plan document reflects a wind-down structure rather than a reorganized operating entity, with intercompany claims and interests reinstated or cancelled based on their specific treatment - Joint Plan of Reorganization.

Claims administration continued after the plan filings. The docket includes omnibus claim objection activity, including a Plan Administrator omnibus objection filed in 2025, indicating ongoing efforts to reconcile claims and reduce the claims pool before distributions - Plan Administrator Omnibus Objection. The claims and noticing agent, Kurtzman Carson Consultants, LLC dba Verita Global, is responsible for maintaining the claims register and distributing notices to creditors and parties in interest - Claims Agent Notice. That administrative infrastructure is a key operational component in chapter 11 cases where distributions depend on a validated claims register.

For creditors, the claims agent function provides a centralized mechanism for notices, claim submissions, and distribution tracking. The certificate of service naming Kurtzman Carson Consultants, LLC dba Verita Global reflects the use of a third-party administrator to manage mailings and the official claims register - Claims Agent Notice. That role is particularly important in a sale-driven case where the estate's remaining assets are distributed after claims reconciliation rather than reinvested in ongoing operations.

Key Timeline

Frequently Asked Questions

What does Invitae do?

Invitae provides genetic testing, digital health solutions, and data services for clinicians and health systems, with core offerings in hereditary cancer testing, rare disease diagnostics, and personalized cancer monitoring - First Day Declaration.

When did Invitae file for chapter 11 and where is the case pending?

Invitae filed chapter 11 petitions on February 13, 2024 in the U.S. Bankruptcy Court, District of New Jersey filing announcement.

What asset and liability ranges did Invitae report at filing?

The petition listed estimated assets of $500,000,001-$1 billion and estimated liabilities of $1,000,000,001-$10 billion - Voluntary Petition.

What cash collateral controls governed the case?

The cash collateral orders required a 12.5% negative variance limit on receipts and disbursements, a minimum liquidity threshold of $56.7 million, and weekly or bi-weekly reporting, with adequate protection in the form of superpriority claims and liens - Cash Collateral Motion; Final Cash Collateral Order.

What was the sale timeline approved by the court?

The court-approved sale process set an April 17, 2024 auction date, an April 29, 2024 sale objection deadline, and a May 6, 2024 sale hearing - Bid Procedures Order.

Who bought Invitae's assets and what did the buyer acquire?

Labcorp Genetics Inc. was selected as the winning bidder and acquired Invitae's genetic testing services, digital health solutions, and health data services, strengthening its oncology and rare disease testing capabilities auction coverage and strategic rationale.

What was the sale price and how much in proceeds did the debtors report?

Invitae announced a $239 million cash purchase price plus non-cash consideration in the court-approved sale to Labcorp sale approval release, and later filings referenced approximately $242.3 million in sale proceeds - Sale Order.

How did the plan treat the senior secured notes and unsecured claims?

The joint plan treated Class 3 2028 Senior Secured Notes Claims as impaired and entitled to share in distributable value after priority claims, while Class 6 Parent Unsecured Claims were impaired and entitled to residual value after Classes 1 through 5 - Joint Plan of Reorganization.

Who is the claims agent for Invitae?

Kurtzman Carson Consultants, LLC dba Verita Global serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest - Claims Agent Notice.

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