Breaking Boundaries, Transforming Markets: A Comprehensive Mid-Year Review of the Psychedelic Sector (PRO REPORT)

Table of Contents

2023 Mid-Year Review

The first half of 2023 has come to an end, and so far, this year has been just as action-packed as 2022. The first two quarters of the year have been full of first-of-their-kind clinical trials and psychedelic research, new businesses, failed businesses, altered perceptions, and certainly tons of passion. The second quarter, in particular, has been full of breaking news and important developments in the psychedelic sector.  There has been a lot going on in the industry this year. But, if we were to sum up the momentum into one sentence, it would be this: preparation for the commercialization of MDMA. 

All of the work and excitement over the past few years, or really the past 50 years, has been leading up to the FDA approval of MDMA. As this momentous event creeps closer and closer, excitement is building, and everyone is scrambling to get ready. 

2023’s first quarter was frankly a bit rocky. Several companies, including Field Trip Health and The Synthesis Institute, faced some major challenges. As a result, there was concern about how many companies would meet their untimely demise. Stock prices continued to swirl around the toilet bowl, and investment capital was difficult to come by. One of the main causes of this issue was a lack of consideration for the long-term needs of the industry.

Since 2018, 2.9 billion dollars have been invested in psychedelic companies. However, less than 5% of that money went into building infrastructure. Companies that failed to consider what it would take to have long-term success in the industry began to fall on hard times last year, and that came to an apex in the first quarter of 2023. 

Though none of those circumstances have changed, there has been a palpable shift in the energy of the psychedelic industry from concern back to hope and excitement. The second quarter made it abundantly clear which companies have been smart about how they positioned themselves in the industry. 2022 and Q1 of 2023 weeded out the weaklings, and Q2 has highlighted the strong and durable companies that are going to help the industry flourish.

There have been some big announcements recently regarding how the future needs of the psychedelic industry will be met, and it appears as though everything is finally falling into place. Much of the industry had been quietly contemplating this question: When is the right time to start kicking preparations for MDMA-assisted therapy into high gear? Well, the answer is now. Many companies and investors are charging full speed ahead to build out infrastructure and prepare for the inevitable FDA approval of MDMA.

The hard work people have been putting into shaping the healthcare container of psychedelic medicine has become apparent this past quarter. Companies have begun showing off what they are preparing for the rollout of MDMA-assisted therapy and other psychedelic compounds in the future.

All of this excitement culminated around the MAPS Psychedelic Science Conference. In the second to last week of the quarter, over 12,000 people gathered in Denver, Colorado, to network, learn, and celebrate the AMAZING work that MAPS has done over the last fifty years. This year’s conference was an effort to prepare for the commercialization of MDMA. We’ll know how those efforts panned out at next year’s conference!

This report covers the specifics of the second quarter of this year. For more information on all the nitty-gritty details of the first quarter, be sure to check out our Q1 report. But before we jump in, here are the highlights from the first half of 2023.

Q1 & Q2 Highlights

Research

Research is one thing the industry has not had issues with over the past few years, even as other areas of the psychedelic sector have struggled. The amount of research being done on psychedelic compounds and therapy continues to grow and take new forms as it promises to shape the future of mental health and neurological disorder treatment. 

There has been no shortage of psychedelic studies over the past five years, but this quarter there were a few studies that hold significance for the future of the industry. First up is the industry’s golden child— MAPS. You likely already know about the non-profit’s amazing phase III results that came out last year, and in April, they got even better. The results from a long-term observational follow-up study showed that the effects of MDMA on PTSD are sustained for at least six months. Some test subjects experienced its positive effects for over a year after completing treatment. 

This data is unprecedented. No viable drugs are available to treat PTSD, let alone ones that offer sustained remission from PTSD symptoms after just a few dosings. With FDA approval around the corner, the more than 14 million people in the US diagnosed with PTSD will finally be able to find reprieve from the effects of their trauma. This data also offers some assurance that it could be a strong drug candidate for other mental health indications. 

The drugs currently available for indications such as general anxiety disorder (GAD) and depression only offer temporary reprieve, if they even work at all. A drug that can provide long-term symptom relief would be revolutionary for mental healthcare. 

As for other research this quarter, there was a lot of it. It would be impossible to discuss it all without keeping you here until tomorrow. So, we’ll talk about a few of the most influential advancements in psychedelic research this quarter.

One research topic that garnered a lot of attention recently was the potential benefit of non-hallucinogenic psychedelic analogs. This has been a topic of discussion for a few years now, but there hasn’t been any data either for or against this type of drug. And frankly, there still isn’t a ton. However, there have been some developments that suggest there may be benefits from this type of drug.

If non-hallucinogenic psychedelic compounds do have a practical medical use, they could be a game changer for the industry. They would drastically reduce the amount of medical supervision needed to administer a psychedelic. As a result, revenue and profit margins would drastically increase while allowing more people to access treatment. 

Many people are skeptical about taking the hallucinations out of psychedelics and for good reason. People who have been healed by psychedelics often credit its success to the hallucinatory visions that they have. However, there still may be some benefits even if this novel type of drug is not able to treat all the indications that first-generation psychedelics can. 

Delix Therapeutics is one of the biotech companies betting on these third-generation psychedelic compounds. The company’s Chief Science Officer, Kurt Rasmussen, said at the recent Psychedelic Science Conference: “They may not treat everything, but have potential for treating things like chronic migraine and cluster headaches.”

Rasmussen dreams of a future where patients have the option to choose which version of the medicine they want to use, and he isn’t the only one with this vision. Major psychedelic investors are funding companies that develop non-hallucinogenic psychedelics, called neuropastogens, because they believe in their healing potential. 

Delix Therapeutic’s clinical trials are far too early to judge whether or not they will be as effective as traditional psychedelic compounds. However, a recent study by the Delix Chief Innovation Officer and UC Davis suggests they may have potential.

Psilera is another company researching non-hallucinogenic psychedelics. Through its drug discovery engine, Psilera has sorted through thousands of compounds and recently announced its lead candidate produced through this discovery engine which is a novel, non-hallucinogenic psilocybin derivative. Psilera’s in vivo studies have shown strong potential for its lead candidate.

Another recent study out of UC San Diego also suggested that a non-hallucinogenic version of LSD could be beneficial for treating mood disorders. Once again, this data is very preliminary. However, we are closer than ever to finding out the answer to the question that so many are wondering— will non-hallucinogenic psychedelics be a positive addition to the growing number of novel psychedelic compounds promising to enter the market over the next ten years?

Below is a comprehensive list of the most important clinical trials and studies done in the psychedelic industry this past quarter. We don’t want to take up your whole day going over the implications of each one. So, for more insights into the developments and implications of psychedelic research, make sure to stay up to date on all of our articles at psychedelicinvest.com. 

MAPS observational study shows that patients treated with MDMA in phase 3 study had lasting results 6 months- over a year after treatment

Delix Therapeutics and UC Davis study provides insight into why neuroplastogens may outperform SSRIs

Positive long-term results for cancer patients dosed with COMP360

MindMed MM-120 Phase 2b continues in conjunction with Numinus Labs

Algernon Pharmaceuticals subsidiary Algernon Neuro Science successful Phase I study DMT for TBI. Will move on to phase 2 *FIRST TBI CLINICAL STUDY*

Numinus to research COMP360 as part of Phase 3 study

Filament Health announces positive results (well-tolerated) from phase 1 trial— first clinical study testing natural psilocybin and psilocin

Cybin dosed the first human in Phase I IV DMT clinical trial

FDA approves clinical trial of  MDMA for the treatment of Schizophrenia

Beckley Psythech initiates phase IIa study of 5-MeO-DMT candidate BPL-003 for Alcohol Use Disorder

Apex Labs gains approval for psilocybin macrodose study of 160 people

Apex Labs completes phase 2b take-home psilocybin study 

Clearmind Medicine and Scisparc to conduct a study evaluating combination treatment for obesity and metabolic syndrome

Government, Politics, and Psychedelics

This quarter there has been remarkable progress in the political landscape regarding psychedelics.. Government agencies and politicians are showing significant interest in the potential of psychedelic research. Notable, both state and federal agencies are providing substantial funding to support psychedelic research, with a particular focus on addressing addiction. 

Kentucky and Arizona both announced that they would be committing capital to psychedelic research. Given that these states are incredibly conservative, it is a big sign that the tides of psychedelic stigmas are shifting. 

In early June, Kentucky announced that it was considering putting a significant amount of money from its opioid settlement funds towards researching the benefits of ibogaine for the treatment of addiction. The leader of this effort said that the state would “‘explore the possibility’ of committing ‘no less than $42 million’ to developing the treatment of ibogaine for opioid-use disorder, with a goal of getting it approved within six years from the U.S. Food and Drug Administration.”

Ibogaine is one of the most promising psychedelic compounds for treating addiction, especially opioid use disorder. Unfortunately, not everyone in Kentucky is on board with putting so much money towards studying a psychedelic. The opposition claims that there are already very good opioid withdrawal management drugs available on the market. This is simply not true. Whether or not the committee overseeing this decision will agree is yet to be seen. 

Arizona also allocated $5 million for research on how magic mushrooms affect depression, PTSD, addiction, chronic pain, and long Covid-19 symptoms. This is the first time any US state has funded research on natural psilocybin. This is a huge win for those supporting the use of natural psychedelics, as opposed to a synthetic version which will likely only be available in the future through companies that have patented their own ‘novel compound.’

A great deal of this growing advocacy for psychedelics is coming from conservative states and politicians. This quarter has seen a huge amount of bipartisan support for psychedelics, specifically for the treatment of PTSD and addiction.

The National Institute on Drug Abuse (NIDA) has also taken an interest in the benefits of treating addiction with psychedelic medicines. The institute is a part of The National Health Organization (NIH). They are offering a grant that will fund four studies. These studies aim to investigate what psychedelics do to people’s brains and behavior to help them overcome addiction. Up to $8.8 million will be available to the four studies between 2024 and 2029.

One more state jumped into the mix right at the end of the quarter— California. It is no surprise that California is considering funding research into psychedelic treatment, and it is not just because the Golden State was the center of the psychedelic movement back in the 60s. Today, it is dealing with major addiction and homelessness issues, and psychedelics may be the solution. 

California spends $90 billion per year on substance abuse disorder. TREAT California is a proposition that would allocate $5 billion “to create a sustainable funding agency to build a psychedelic ecosystem,” according to the initiative’s leader Jeannie Fontana.

This citizen-driven initiative needs 1 million signatures by the end of the year to make it onto the November 2024 ballot. If it succeeds in getting onto the ballot, Californians will have the opportunity to vote on it. 

This is a very interesting initiative because it aims to build out an entire ecosystem that will support access to psychedelic-assisted therapy. The program will promote the legal use of psychedelic compounds by supporting for-profit clinical trials. They will also use the funding to build out the infrastructure to support the industry in California.

TREAT California is using novel strategies to promote access to psychedelic therapy, and it will be interesting to see how it turns out. According to Fontana, current polls suggest that the proposition would pass, with 60% of voters supporting it. 

Overall, the movement surrounding psychedelics in the US has been incredibly positive. Both red and blue states are pouring capital into psychedelic research in hopes that it will address issues that its citizens are struggling with. 

In news outside the US, psychedelic dispensaries are continuing to pop up across Canada. These locations where people can buy an assortment of psychedelic products are technically illegal. However, law enforcement has not taken any measures to shut them down.

Over in Australia, they are preparing for the legal medical use of MDMA and psilocybin. The news came out last quarter and will be going into effect on July 1st. Several companies have been preparing to provide the drugs for treatment. Other than that, we don’t know much yet. It is definitely something to keep an eye on in the third quarter.

Events & Media

It has been another big year for spreading the good word of psychedelics. This quarter, major publications and celebrities have continued to come out and voice their support for mind-manifesting compounds. Not to mention the biggest psychedelic conference in history that just took place in Colorado. 

The Psychedelic Science Conference, hosted by the infamous MAPS, took place the third week in June. Over twelve thousand people gathered in Denver, Colorado, to network, learn, and discuss the future of the industry— compared to just 3000 people six years ago. It is all anyone can talk about. 

The conference was as colorful and exciting as you’d imagine a psychedelic conference to be. It started with Rick Doblin— dressed all in white— sharing his dream for “net zero trauma” by 2070. After Doblin’s welcome speech, people were free to stand in a long line to purchase some psychedelic products or wander around and check out the trippy art. 

Hundreds of speakers discussed issues and solutions to the global mental health crisis. A great deal of the attendees were doctors and therapists eager to promote and/or get involved in psychedelic therapy. This was by design, as MAPS is eager to start increasing the number of qualified practitioners that will be able to provide MDMA-assisted therapy once it becomes available next year. 

To finish out the quarter strong, The Wall Street Journal published an article titled: “Magic Mushrooms. LSD. Ketamine. The Drugs That Power Silicon Valley.” For those familiar with tech bros, this probably doesn’t come as a surprise. However, Silicon Valley lives in a bit of a bubble, so the rest of the world may not have been aware of how the ideas for their favorite tech gadgets and games came to be. 

This is a big deal because the tech industry holds a lot of influence. They are often the first to try new and innovative things, which then disseminate to the rest of the world. The article begins by outing Elon Musk for his use of ketamine to help enhance his work and manage depression. Musk has not been shy about his support of psychedelics in the past and made an even bigger splash with this article. 

Business

Unlike the first quarter of 2023, we saw some positive industry growth during Q2. In quarter 1, there were tons of ketamine clinics shut down, a bankruptcy, and another potential bankruptcy from Field Trip Health. News this past quarter has been much more positive. 

Things have been looking up, and there have been some great business opportunities over the past few months. Several opportunities have been popping up to supply MDMA and psilocybin to medical practices in Australia. The two compounds will be available for medical use starting on July 1st. Some Canadian and US companies are taking advantage of this as a new source of revenue. There hasn’t been much interest from clinic companies. However, companies that grow psilocybin and/or produce MDMA have a chance to capitalize on this legal market.

One company that has hopped on this opportunity is Optimi. The company has secured agreements to supply its medical-grade psychedelics to several companies in Australia and beyond. Optimi has also been securing contracts with other companies in need of psychedelics for clinical research, including one with Numinus for an experiential training program sponsored by MAPS.

Numinus has also been making headlines left and right. The company’s partnership with MAPS puts it in a strong position to capitalize on the commercialization of MDMA. They are also working with two of the other biggest names in the industry— Compass Pathways and MindMed. Lastly, Numinus announced a strategic partnership with Healingmaps.com, and they aren’t the only ones looking to utilize the valuable data that the website provides. Healing REIT has been working with Healing Maps from day one to help determine where to open clinics. 

In other news, there is finally some word from MindMed after the company stayed relatively quiet during Q1. The end of 2022 was marked by a potential hostile takeover of the company instigated by Freeman Capital. There has been little news about this debacle during 2023, though it was making weekly headlines in Q3 and Q4 of 2022. The silence left investors wondering what was happening with the company. 

It seems as though MindMed’s management has been able to hold its ground. In June, shareholders voted to elect all six of management’s nominees to the board of directors, including CEO Robert Barrow.

Overall, it has been a busy quarter for the psychedelic sector. Though there are challenges that the industry faces, there really hasn’t been much drama these past three months— which is not always the case. However, there continue to be challenges regarding capital, stocks, and infrastructure. Keep reading for an in-depth analysis of these issues.

Capital

Capital is still more difficult to come by than it was a few years ago. However, not impossible. Several companies have been able to secure capital to support getting operations off the ground. Fortunately, there are increasing opportunities for psychedelic companies to make revenue, making investors slightly more willing to support companies in the industry. 

Reunion Neuroscience was able to raise just over $13.1 million in a private placement. A good sign for the company, considering that it used to be a part of Field Trip Health which is on the verge of bankruptcy. 

Nucleus also had a big quarter— raising over $500k through a crowdfunding campaign that closed at the end of April. The psychedelic venture studio is excited to start expanding its assets to support this new realm of mental healthcare. 

Lastly, after the Psychedelic Science Conference, MAPS announced that they want to raise $85 million in a private share sale. Frankly, it is incredible that a non-profit has managed to push a drug all the way through phase III trials. Now, they are strapped for cash and in need of capital to help them through the FDA approval and commercialization of MDMA.  

At the end of last year, companies needed at least a few years of cash runway to be considered a prospect for long-term success. As the industry continues to prepare for the commercialization of MDMA and, later, psilocybin, a large amount of capital will be needed. More and more institutional investors are taking an interest in psychedelics, which means that companies with solid business plans and good leadership should be able to access the capital that they need to bring a new psychedelic drug, product, or service to market. 

Stocks

While the rest of the industry begins to see the light at the end of the tunnel, the state of the psychedelic stock index has remained fairly dismal. Though, the quarter finished out strong with some positive movement in psychedelic stocks following the Psychedelic Science Conference. 

The psychedelic stock index rose slightly during Q2. However, it is nothing compared to the drop-off in stock prices that we’ve seen since late 2021. Continued inflation and slow recovery from the bear market have kept stocks low. 

To give you an idea of where psychedelic stocks are, Atai Life Sciences currently has a market cap of $240 million compared to $3 billion two years ago. Although the rest of the industry has been seeing some positive growth this quarter, especially compared to the first quarter of 2023, psychedelic stocks have not been so fortunate. 

The psychedelic stock index hit its lowest point ever in the last week of Q1 and has gradually increased since then. It is back to where it was at the beginning of the year, but significantly less than we saw during the last few years. 

There was a bit of good news following the last week of the quarter. During the week of June 26th, psychedelic stocks outperformed the broader Biopharma industry. It isn’t particularly surprising that the conference had positive effects on the psychedelic stock index. Such a broadspread show of support from people like Rick Perry and Aaron Rodgers is bound to increase confidence in the ability of psychedelic companies to provide returns. 

Psychedelic stocks may continue to trade at fairly low prices for the rest of the year, but will likely see an increase following the FDA approval of MDMA. Many psychedelic companies are still a ways away from turning a profit, which makes them a risky investment. Nevertheless, once investors see that there is potential for huge returns, they will be more willing to take the risk.

Patents

The race to develop and patent the most innovative novel psychedelic compounds continues. Dozens of new patents were filed this quarter by a handful of different companies. Psychedelic companies are rapidly developing novel compounds in hopes that they will be the ones to transform the industry. 

Among the companies patenting novel compounds this quarter were Enveric Biosciences, Small Pharma, and Mindset Pharma. Small Pharma strengthened its IP portfolio with five new patents. Mindset Pharma filed two patents this quarter for non-hallucinogenic, non-tryptamine compounds. The drugs activate the 5-HT2A receptors, like psychedelics, without the hallucinations. It will be interesting to see how these drugs hold up in clinical trials. 

Last year, there was some drama regarding what companies should be able to patent. There hasn’t been as much uproar in 2023, though it remains an issue. The concern is regarding whether or not some companies are attempting to patent compounds that are not novel. This issue only applies to some companies, such as Compass Pathways. 

The ongoing saga of Compass Pathways defending its COMP360 patent continued this quarter. The patent was initially challenged over a year ago and has managed to stand its ground. For more details on this issue, check out the Ethics section.

Infrastructure

Many top players in the industry are playing a part in rapidly building out the infrastructure needed to commercialize MDMA once it is approved by the FDA. Numinus, however, has taken the cake this quarter for supporting this need within the industry. 

Numinus CEO and founder said recently that he founded the company to answer this question: “What is an organization like MAPS gonna need to really be successful?” The company is doing just that. This quarter, Numinus announced partnerships with MAPS and Healing REIT, as well as the creation of the Numinus Network. This program is designed to be a turn-key solution for psychedelic clinics. All of this is to help ensure a rapid rollout of MDMA services. 

The company said about The Numinus Network: “In anticipation of this regulatory approval, Numinus has undertaken several initiatives to prepare the company for a rapid rollout of MDMA-AT services (using the MAPS protocol), including the recently launched Numinus Network™ clinic expansion program, reallocation of resources towards revenue producing activities, cost containment initiatives, and preparation for insurance reimbursement systems.” They are making an effort to address all of the anticipated roadblocks that will need to be overcome in order to ensure a smooth rollout of MDMA-assisted therapy. 

In addition to the Numinus Network, the company has partnered with MAPS and Healing REIT to address the two major issues predicted to create a bottleneck in the available treatment supply. Numinus is working with MAPS to develop a network of qualified therapists with a turn-key solution to opening clinics in hopes that they can help ensure enough supply of MDMA-assisted therapy. 

Numinus isn’t the only company trying to address these issues. As mentioned above, Healing REIT is also working to overcome these issues. The Real Estate fund was started by cannabis and psychedelics investor Cody Shandraw to build out the clinic infrastructure needed to support psychedelic-assisted therapy. Building out infrastructure will continue to be a main objective in the industry over the next few years.

Ethics

Ethical issues were a major topic in the industry this quarter. Not because there have been any major ethics violations recently. Rather, people are well aware that the current business leaders are shaping what the future of the industry will look like, and many are conscious about what they are shaping it into. 

The following are some of the main ethical concerns that are being discussed right now. 

Patient Safety

It is no surprise that this is a main concern in the industry. Of course, no one wants patients to experience harm while accessing psychedelics. However, this is a very complex topic. People are struggling to find the right place between patient safety and allowing practitioners to carry out their work with too much control from regulatory forces.

People have been working with the psychedelic underground for over half a century, with very little harm being done. It goes without saying that it is impossible to eliminate safety issues completely. Even the highly-regulated areas of healthcare have issues with doctors harming patients. 

There are many questions to be answered regarding patient safety. The main issue is that regulatory bodies know very little about the practices used in psychedelic therapy. Will it end up doing more harm than for them to set the standards of practice when they have very little understanding of what happens in a psychedelic experience? Many discussions are being held over where to draw the line between letting the therapists do what they know is best and ensuring enough structure to prevent harm.

Equity & Accessibility

The cost of treatment is going to be incredibly high. The exact prices aren’t known yet. However, MDMA treatment is predicted to cost somewhere around 10k-15k. Some of the first treatment centers in Oregon are already charging north of a thousand dollars for a single treatment session. 

Ensuring that people are able to afford treatment is going to be a major issue in the psychedelic industry over the next 5-10 years. Fortunately, there has been some news this quarter that promises insurance coverage of not just psychedelic drugs but the treatment that accompanies them. Though this problem is going to be ongoing, industry leaders are quite aware of this issue and are working hard to overcome it.

Cultural Integration

There is a lot of concern as to whether or not the industry is sensitive to cultural appropriation. There are some people who are quite angry that they are feeling excluded from the exponential growth of the industry. Unfortunately, it is difficult to integrate traditional shamanic practices into the pharmaceutical model. However, that is only one aspect of the industry.

Though all the focus recently has been on MAPS and the commercialization of MDMA, there is still a major underground market that allows people to use whichever practices they like. It is this community that continues to celebrate the native traditions that have contributed to the development of psychedelic treatment. 

Unfortunately, it is unreasonable to expect that the FDA or any US federal government body is going to be open to shamanic practices. On the other hand, those practicing in native psychedelic traditions are often resistant to compromising with the government and/or pharmaceutical space. However, there is more hope at the state level. Both Colorado and Oregon have been careful to set up their laws to allow practitioners to practice within whichever traditions they like. 

Long-term Effects

Many psychedelic compounds, such as LSD, Ayahuasca, Magic mushrooms, and MDMA, have been used for decades with no known long-term side effects. However, since this use has been primarily underground, there isn’t much strong empirical evidence to support this claim. Furthermore, there is no way to assess the long-term effects of the novel psychedelic compounds currently being developed by biotech companies. 

This is not an issue exclusive to the psychedelic sector of pharmaceuticals. Every new drug in the history of the world was given to people long before there was any information on long-term effects. The difference here is that the psychedelic industry collectively cares more about health than the average pharmaceutical company. 

Professional Training and Standards

The decisions made right now are going to affect the standards of practice in psychedelic medicine for years to come. There are a handful of different subtopics within this area that are being assessed, including the requirements to be a psychedelic therapist and what should be included in their training. 

Oregon is currently testing out the first regulated certification program in the US. However, it is difficult to say what is and isn’t working since so few people have actually been able to access the psilocybin program due to a shortage of clinics and facilitators.

There are tons of different treatment protocols that range from clinically studied practices to thousand-year-old traditions. The question being asked here is— who is to say which way is the right way? Well, when it comes to federally sanctioned therapeutics, the bureaucrats get the last word. Though they don’t really know anything about psychedelics, leaders in the space are stepping in and attempting to influence decisions.

As for the practitioners who operate outside of the law, despite not being required to complete training, many do seek out guidance to improve their practice. There are tons of training programs popping up based on various teaching. And, of course, there is the old-fashioned way that some practitioners choose— many healers that work in native traditions learn through apprenticeships. 

Intellectual Property & Access

This is a major one that people have been concerned about for quite some time. In fact, there is an entire non-profit called Freedom to Operate working on challenging patents that threaten to drive up the cost of psychedelic drugs astronomically.

Freedom to Operate has challenged the infamous Compass Pathways’ COMP360 (synthetic psilocybin) patent. However, the patent has been upheld multiple times now— most recently in June by the US Patent and Trademark Office. 

Since patented drugs generally result in drastically higher drug prices, people are concerned that companies are patenting psychedelic compounds left and right. A company should have the right to patent a novel drug that it spent a significant amount of time and capital developing. However, people are concerned that some companies are taking advantage of the fact that much of the psychedelic research from the past half a century is not public information because it was done underground. This allows companies to potentially take credit for compounds and treatment protocols that are not novel. 

In the case of COMP360, it is argued that synthetic psilocybin was developed some time ago and should not be a patentable compound. Thus far, Compass has been able to sustain that its drug is, in fact, novel.

It’s important to note that the psychedelic industry is still evolving, and ongoing discussions, research, and collaboration among stakeholders are necessary to address these ethical concerns effectively. These issues have been at the forefront of discussions, and Beckley Waves have even established an ethics council. The council is composed of experts, including Paul Stamets, Rick Doblin, Amanda Feilding, and more. 

Not only do they have a strong understanding of the compounds at hand, but they have been fighting for the legalization of psychedelics through thick and thin. It is quite apparent that a blazing passion for helping people fuels their work, and that is exactly the type of people who should be leading the efforts on ethics in the industry. It is a nice dichotomy to the standard healthcare industry, which has the people making billions of dollars off of drugs leading the efforts for “ethical” treatment. 

What to Expect in Q3

Momentum has been picking up the past quarter and will likely continue to do so throughout Q3 and beyond. Given the current trajectory, there is no reason not to believe that all areas of the industry will continue to move in a positive direction. 

There can always be unforeseen events that cause challenges, and there likely will be. However, one thing the industry can count on is the strength of the science that it is being built upon. There is a good likelihood that the industry will be able to overcome any obstacles it faces because psychedelic companies are offering novel treatments for issues with few existing viable solutions. 

MAPS is expected to submit its New Drug Application (NDA) to the FDA in Q3 or Q4 of this year. As a result, during the third quarter and throughout the rest of the year, the industry will continue to prepare for the roll-out of MDMA-assisted therapy in the US. Companies like Numinus will continue to secure their position to help roll out this new type of therapy. New companies will also likely make an appearance— attempting to get in on the action before it starts. Over in Australia, things are already in play.

As of July 1st, MDMA and psilocybin are legal for medical use. The program will begin to take form during Q3. In fact, this has been one of the main topics during the first week of the quarter. One of the big issues that this program is facing is the cost barrier. Treatment is expected to cost patients up to $20k out of pocket. It will be interesting to keep an eye on how the country deals will helping people access this treatment. 

Another thing to look forward to this coming quarter is PrescriptionX. This documentary highlighting Rick Doblin’s 50-year fight to legalize psychedelics is bound to be inspiring. Though some people were critical of Doblin’s choice to address the Psychedelic Science Conference wearing all white like a cult leader, there is no doubt that we would not be here today— with psychedelic legalization in our grasps— without the man. It is important to take some time to step back and appreciate the people who fought incredibly hard for the psychedelic dream that so many of us hold today. 

There are a lot of reasons to be excited for quarter three and the rest of the year. It’s a bit like sitting in the living room as a kid on Christmas and being forced to wait to open the present that you know is what you asked for. Legal psychedelic-assisted therapy is right in front of us but not yet accessible. Here is to hoping that we all have more patience than a five-year-old. 

Psychedelic Invest is here to be your guide throughout all the ups and downs that this industry has to offer. Follow along with us as we cover all major news and developments regarding the wonderful, mind-manifesting compounds that have brought this industry together.