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The genetics testing company 23andMe will enter the public markets via a special purpose acquisition corporation sponsored by Virgin Group founder Richard Branson, a deal that values the company at $3.5 billion.

The transaction with VG Acquisition Corp. will provide a burst of capital to 23andMe as it seeks to expand its business beyond direct-to-consumer genetic testing to develop novel therapeutics. Last fall, 23andMe formed a partnership with the drug giant GlaxoSmithKline to discover new drugs using data culled from millions of the company’s customers.

Anne Wojcicki, the founder of 23andMe, told STAT in an interview that she was excited to go public, and that it is time for 23andMe “to really put our foot on the gas and go.”

“Being a public company makes you better,” Wojcicki said, quoting Salesforce founder and CEO Marc Benioff, “It’s the right time in the company. And there’s just a huge opportunity for us on both the therapeutics side and the consumer side. And like I said, I’m eager to run.”

The addition of Branson, a British investor who has built a business...