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Psychedelics in 2022: Iter Investments and Industry Predictions

2021 was a difficult year for many psychedelics investors.  However, the number of ketamine clinics continued to grow, research efforts into the therapeutic…

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2021 was a difficult year for many psychedelics investors. 

However, the number of ketamine clinics continued to grow, research efforts into the therapeutic use of various psychedelics (mainly psilocybin and MDMA) reported impressive positive results, and the international movement towards legalization strengthened.

What to expect in 2022?

Will the psychedelics sector echo cannabis?

If the short history of the psychedelics sector has shown anything, it is to expect the unexpected.

With that caveat kept in mind, we asked a few psychedelics experts at Iter Investments – a venture capital firm focused on supporting emerging companies within the psychedelic ecosystem of behavioral and mental health – for insights into what 2022 may bring for psychedelics.

Dustin Robinson: Iter Investments’ Managing Partner and Founder

Robinson is a leader within the psychedelic ecosystem and has been ranked by Psychedelic Invest as the Top 100 Most Influential People in Psychedelics. As a licensed attorney and CPA with a law firm that exclusively works in the cannabis and psychedelic space and as the founder of a leading non-profit that is paving the way for psychedelic legalization, Robinson is an expert in understanding and capitalizing on opportunities within highly regulated industries. Robinson has been featured in top publications (i.e. Forbes) for his deep knowledge, experience, and advocacy in the psychedelic space; and his law firm has been listed by Psychedelic Invest as one of the Five Psychedelic Law Firms You Should Have on Your Radar. He is also the Managing Partner of Iter Investments, a leading venture capital firm investing across the psychedelic ecosystem.

Looking back, Robinson observed that the psychedelic industry in 2020 had a lot of hype that caused valuations to inflate.

In 2021, however, “We saw overhype dissipate a bit and valuations have come down to realistic numbers. Nonetheless, 2021 was a very positive year from a scientific perspective.”

In 2022, Robinson predicts that further research results will confirm the safety and efficacy of psychedelics. He expects MAPS, Compass Pathway and Usona to release new clinical trial data. More drug sponsors will publish Phase One and Phase Two clinical trial results for various psychedelic compounds and various indications and more institutions in general will publish the results of their research.

On the M&A front, Robinson pointed out that several companies are sitting on large sums of cash and have high valuations. Meanwhile, other companies are having trouble raising the capital needed and have depressed valuations. This, Robinson argued, will lead to consolidation in the industry through M&A involving stock swaps and cash infusions. As well, he noted, psychedelic companies operating at different parts of the value chain will start to recognize synergies with one another, which will lead to further M&A activity.

Noting the 2021 challenges to Compass Pathway’s patents, Robinson predicted more psychedelic patent challenges in 2022. There was an “explosion of provisional patents related to psychedelic medicines filed in 2020 and 2021,” Robinson said. These patents will become available to the public 18 months after filing, which will increase transparency as to which companies have the strongest patent positions. “2022 is going to weed out many companies that do not have strong patent positions,” he stated.

Robinson expects to see more companies involved with retreats and functional mushrooms companies appear in 2022, plus many new technologies to emerge around the concept of set/setting/dosage.

Robinson expects that by the end of 2022, Oregon will have created a meaningful structure around Measure 109 and will be ready to roll out its program by 2023.

“As research continues to prove the safety and efficacy of psychedelic compounds, we will see more institutional investors entering the market,” he concluded.

Dr. Michelle Weiner: Iter’s Clinical Lead

Dr. Michelle Weiner is double board-certified in Interventional Pain Medicine and Physical Medicine and Rehabilitation. She completed her residency and fellowship training at the University of Miami. She is the Chair of Florida’s Medical Cannabis Advisory Committee. Dr. Weiner’s unique approach of personalized and preventative medicine focuses on empowering her patients to cultivate health using lifestyle and plant medicine. Her research focuses on using cannabis as a substitute for opioids in chronic pain patients and cannabis’s effect on seniors with chronic pain. She is conducting a pharmacokinetic study at the University of Miami investigating how to optimize the bioavailability of cannabinoids using water-soluble nanoemulsions. She is faculty and a preceptor at Nova Southeastern University in which she educates the medical students through shadowing opportunities in her office. Dr. Weiner is the Vice President of Mr. Psychedelic Law, a not-for-profit with the mission of responsible legal reform of psilocybin mushrooms in Florida. She uses cannabis and ketamine-assisted psychotherapy as a catalyst to identify the root cause of one’s suffering optimizing their quality of life.

In 2022, Dr. Weiner expects to see the inclusion of “chronic pain / central sensitization sucubas fibromyalgia into the field of psychiatry as more research is available about the mind-body connection.”

The number of ketamine clinics will increase, while a ketamine coalition of ethical and best practices will be created with evidence on how to extend the antidepressant effects of ketamine using protocols with different routes of administration.

She expects to see increased evidence behind the “neuropharm and neurobiological mechanisms of consciousness and altered levels of consciousness, DMN (lucid dreams, psychedelics, VR) using functional imaging studies.”

Dr. Weiner foresees a shift in clinical psychiatry from a biologic model to a model which values perceptual changes.

2022 will bring an increased focus on the use of psychedelics to treat autoimmune and neurodegenerative conditions. 

There will be increased research on athletes, performance, and microdosing.

Dr. Weiner expects new strategies for tapering antidepressants and more therapists being trained in MDMA by MAPS.

Dr. Scott Fisher: Iter’s Psychiatric Lead

Scott Fisher, operating out of Fort Lauderdale, FL, is a psychedelic psychiatrist trained at the California Institute of Integral Studies and Northwestern University serving as Lead Facilitator at the Florida site, Segal Clinical Trials, for the Usona Institute sponsored PSIL201, a study of the effectiveness of psilocybin for the treatment of depression. He serves as an advisor to Iter Investments, a venture capital firm investing in the psychedelic space, and Intiem, developing psychedelic treatments for sexual health. He is also the lead facilitator in a FDA Phase 2 trial assessing the effectiveness of a single dose of psilocybin for severe depression.

There will be a large surge in interest from people who want to get access to psychedelics now, whether it is through policy initiatives, overseas psychedelic retreats, or illegal use, Dr. Fisher believes. 

He added that there will likely be many new start-ups entering the psychedelic arena, despite it being already a highly competitive and crowded terrain, as well as many mergers, acquisitions, and dissolutions. 

“We will likely see two ongoing Phase III FDA registered trials occurring (MAPS and Compass Pathways), the completion of Usona’s Phase IIb trial, and the beginning of several other Phase II trials,” he said – a prediction very similar to one of Robinson’s.

Dr. Fisher hopes to see more federal grants awarded to the study of psychedelic compounds this year.

He expects to continue to see an explosion in demand for integrative practices often included in psychedelic treatments, such as yoga, mindfulness, music therapy and sound healing, nature retreats, ecstatic dance, aromatherapy, nutritional and dietary products, etc.

John Gregg: Iter’s Commercialization Lead

Start-up and pharmaceutical industry veteran, John M.H. Gregg, has extensive experience in forming and successfully exiting infectious disease companies. His expertise is in worldwide clinical development and commercialization of microbiological products, new anti-infectives, and oncology drugs, most recently with an FDA approval in September 2017 of Solosec (secnidazole). He has spent much of his career directing the commercialization efforts for a large number of antibiotic, anti-protozoal, anti-fungal, and anti-viral drugs as well as therapeutics in multiple other therapeutic areas, including immunology, oncology, and neuroscience. He is an industry leader in biotech company development, serving as CEO of specialty infectious disease start-ups like his current company, BalinBac, now focused on developing direct antivirals for COVID-19.

In 2022, Gregg expects greater regulatory clarity from the Food and Drug Administration about the nature of psychotherapy-assisted treatments and REMS programs associated with therapy.

Also likely this year are big investments by premier Big Pharma venture groups on analogs that don’t require REMS programs and assisted therapy. This will be due to concerns about bottlenecks related to the lack of clarity of delivery requirements in conjunction with psychotherapy programs, Gregg argued.

Patents on existing psychedelics for a new composition of matter won’t hold up and disputes will occur relating to methods of treatment IP, Gregg concluded.

Rayyan Raja Zafar: Iter’s Research Lead

Zafar is conducting his PhD with a medical research council fellowship under Professor David Nutt at Imperial College London in the Centre for Psychedelic Research and Neuropsychopharmacology. He is working across several clinical and brain imaging studies to assess the mechanisms of addiction in the human brain using neuroimaging. Zafar is also working across studies developing novel pharmacological interventions, including classical and non-classical psychedelics, to treat a range of psychiatric conditions in early proof of concept and clinical studies.

Zafar predicts that 2022 will see the movement of psychedelic research out of psychiatry into areas such as neurology, immunopathology, and oncology.

As well, he foresees the next phase of controlled clinical research in regards to addiction, OCD, chronic pain, and anorexia nervosa.

Advancements of understanding in the role of the ‘trip’ in the therapeutic effect when compared with “non-psychedelic serotonergic agonists” are likely this year, he argued. 

Zafar expects more nuance in understanding the impact of non-pharmacological factors and a broader understanding of the neurobiological mechanisms that mediate the effects of psychedelics.

Andrew Hall: Iter’s Scientific Lead

Andrew Hall has a PhD in Natural Products Chemistry and Pharmacognosy and is the Chief Science Officer of Green Scientific Labs. A pharmacognosist and an ethnochemist, much of Hall’s work is focused on the standardization in cultivation, extraction, and testing of medicinal plants and marine invertebrates. He has expertise in the overall function of a laboratory from startup, method development, federal, state, and ISO 17025 licensing, accreditation, and compliance.

In 2022, more states will begin to decriminalize naturally occurring psychedelics, Hall argued. Bills to this effect will gain more attention and approvals.

More companies will develop novel indications for psychedelics, along with delivery technology.

As some of the patents become available for specific indications, observers of the psychedelics market will “get more clarity,” Hall noted.

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