MindMed (Nasdaq:MNMD) shares have sustained strong selling pressure in the last few months, falling more than 80% in the last year to yesterday's low at $.79.
However, the combination of yesterday's bullish 'hammer' candlestick and today's large full bodied bullish candlestick offers strong evidence that a major low may be in place. The flush below the $1.00 level on heavy volume is characteristic of the sort of capitulation selling that can often mark a major bottom in a stock.
MindMed shares are surging 37% on enormous trading volume after the FDA gave the company the green light for the first commercial study of LSD in more than 40 years.
The $1.00 level now becomes critical downside support, and the next area of potential resistance is between $1.65 and $1.75 (30%-40% from where the stock is trading today).
MindMed announced today that the FDA has cleared MindMed's Investigational New Drug (IND) application for their lead drug candidate, MM-120 (a proprietary LSD-based drug compound), to proceed with the company's Phase 2b dose-optimization trial (clinical study "MMED008") of MM-120 for the treatment of generalized anxiety disorder (GAD) to proceed. This news comes on the heels of MindMed's successful completion of their Phase 1 trial for 18-MC (ibogaine) as a treatment for opiod addiction.
"FDA clearance of our Phase 2b clinical trial represents a major milestone, for MindMed and for the industry as a whole. This trial, the first commercial study of LSD in more than 40 years, builds on productive discussions with FDA and provides an opportunity to explore improvements in anxiety symptoms following a single administration of MM-120. Further, the results of this trial will guide the dose selection and development strategy for our pivotal Phase 3 clinical trials, as well as deepen our scientific understanding of the clinical effects of MM-120 and its underlying mechanisms of action."
MM-120 is MindMed's proprietary drug candidate, a pharmacologically optimized form of LSD being developed for GAD and other brain-based disorders. LSD was first synthesized in 1938 and its psychoactive properties were discovered in 1943. From 1949 to 1966, LSD was used by psychiatrists and researchers to gain insights into the world of brain health and to assist psychotherapy. LSD has been investigated for its applications in the treatment of anxiety associated with terminal cancer, alcoholism, opioid use disorder, and depression, among other conditions.
Study MMED008 is a multicenter, randomized, double-blind, placebo-controlled, dose-optimization Phase 2b trial in patients with GAD. The trial plans to enroll a total of 200 participants who will receive a single administration of up to 200 µg of MM-120 or a placebo control. The primary objective of the study is to determine the reduction in anxiety symptoms for up to twelve weeks after a single administration of MM-120, compared across five treatment arms.
GAD is a chronic, often debilitating mental health disorder that affects approximately 6% of U.S. adults in their lifetimes. Symptoms of GAD include excessive anxiety and worry that persists for over six months, which can lead to significant impairments in social, occupational and other functioning, according to the National Institute of Mental Health (NIMH). While there is substantial diagnostic overlap between GAD, Major Depressive Disorder (MDD) and other major mental health disorders, there has been very little innovation focused on the treatment of GAD in the past several decades due to the shift in focus from anxiety disorders like GAD toward depressive disorders like MDD, driven by the marketing of serotonin reuptake inhibitors starting in the 1990s.
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