Jul 12, 2021

MindMed: Developing a holistic approach to treating mental illness with psychedelic compounds

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MindMed (Nasdaq: MNMD) (NEO: MMED) (DE: MMQ) (the “Company”) is an industry-leading biotech company engineering psychedelic-inspired therapies. The company is developing a combinatorial approach to treating mental illnesses with hallucinogenic (e.g., LSD) and non-hallucinogenic (aka “microdosing”) therapies in clinical settings. MindMed's core philosophy is that a coordinated effort between therapists, drug developers, and patients is needed to develop personalized, precision treatments on a patient-by-patient basis.

The company believes that symptom management is unacceptable, and patients deserve treatments that put an end to their mental afflictions. To this end, MindMed has organized a network of partnerships to share patient data to drive insights and develop breakthrough therapies in the quickly evolving industry of mental wellness. MindMed is focused on delivering immediate impact through comprehensive, holistic treatment programs and integrated tool sets that empower therapists to focus on what they do best: reveal the subconscious traumas that underlie mental illnesses with the aid of “experiential” (aka “hallucinogenic”) doses of psychedelics and employ cognitive behavioral therapies patients’ thought patterns.

The company is composed of an interdisciplinary team of drug development veterans, savvy technologists, and mental health experts. With over a century of combined experience in drug development and commercialization, MindMed has the know-how and the heart to shift the paradigm of mental health.


Mental health is an overlooked segment of overall human well-being due to its complexity and poorly understood molecular origins. There has been little innovation in this disease area over the last 50 years, and antiquated “cure all” drugs such as Zoloft and Xanax are routinely prescribed to treat patients with any number of mental health disorders (depression, anxiety, bipolar, borderline personality, etc.). Anti-anxiety and depression drugs total over $15B in global annual sales, and another $9.5B and $5.8B is spent on treating ADHD and addiction, respectively. Psychiatrists are quick to whip out their prescription pads and usher the patient out the door with an assuring “see you in two weeks, call me if you feel suicidal!” While that sounds crass, it is difficult to place all of the blame for poor treatment on the shoulders of these clinicians; with limited tools at their disposal, and a highly subjective diagnosis schema that fails to capture the nuance in individual patients’ diseases, psychiatrists are ill-equipped to treat the root cause of mental health disorders with drug compounds alone. Simply put, masking disease symptoms does not equate to effective treatment. There is a clear unmet medical need for a new class of drugs that targets the underlying molecular causes of various mental health disorders on an individual patient. Importantly, drug developers must realize that their pharmaceuticals alone are unlikely to eradicate mental disorders. Novel drug compounds must work seamlessly with cognitive behavioral therapies (overseen by a psychologist, as opposed to the prescription-writing psychiatrists) to create a holistic treatment program.

Enter psychedelic-inspired medicine.

Psychedelic-based pharmaceuticals are redefining mental health treatment (Read MedicalGold’s coverage of the psychedelic medical sector). Poised to disrupt the market in a similar fashion to medicinal cannabis, investors are eager to fund this burgeoning industry and accelerate the science. At the forefront of this endeavor is MindMed. The company believes that patients deserve more effective therapies for mental health disorders that not only diminish the symptoms (such as apathy, derealization, suicidal ideation, etc.), but also make the “broken” neural pathways more amenable to re-wiring through cognitive behavioral therapy. 

Pioneering a new asset class

MindMed’s combinatorial approach to treating mental disorders is defined by:

  • A diversified psychedelic pipeline (the more shots on goal, the higher the score).
  • An acquisitive approach to drug development  - a Big Pharma strategy (why re-invent the wheel?).
  • A unique focus on all stages of drug development and delivery to the patient (from discovery to insurance reimbursement).

MindMed’s innovation strategy is 3-fold:

  • Discover new chemical entities through strategic partnerships and collaborations.
  • Develop compounds through the FDA clinical trial process while partnering with other pharmaceutical companies.
  • Deploy novel treatments to hospitals and research centers that will license the company’s protocols and drugs.

MindMed is conscious of the regulatory burden imposed by the FDA and maintains strict adherence to the DEA’s protocols for Schedule 1 License drugs.

Market Opportunity

The elephant in the room

Mental health disorders are a touchy subject, and stigma still surrounds the topic. Many more people suffer from these afflictions than you think. The statistics paint a sobering picture of despair. The numbers do not lie.

  • Over 280M people globally suffer from anxiety, resulting in $1T in lost productivity.
  • 300M annual prescriptions of opioids result in $2.5T spent on treating opioid addiction.
  • 16M adults in the US suffer from ADHD, resulting in $194B in lost productivity annually.

Trends in mental health diagnoses and drug prescriptions paint an alarming picture, which reached a pinnacle amidst the COVID pandemic. Cigna found that anti-anxiety and anti-insomnia prescriptions increased 21% between February 16 and March 15 of 2020 when the outbreak was officially declared a pandemic [1]. A study by the American Psychiatric Association concluded that 62% of people feel more anxious in 2021 than in 2020 [2]. Even before the COVID pandemic, health officials were concerned with the rising rates of benzodiazepine (Xanax, Klonopin) prescriptions due to the staggering increase in fatal overdoses from 1999 to 2018 (1,135 v. 10,724 deaths) [3]. Recent data published by the US Census Bureau and National Center for Health Statistics shows that poll respondents showing symptoms of anxiety or depression has risen 4-fold compared to pre-pandemic figures. 

These statistics correlate with an increase in anti-anxiety, antidepressants, and anti-insomnia prescriptions during the early stages of the pandemic.

Fatal opioid overdose data collected by the CDC paints a grim picture. The epidemic that began in the mid-200s is far from over.

The Center for Medicare and Medicaid Services (CMS) spending on opioid use disorder and withdrawal drugs has skyrocketed since the opioid epidemic took off in the mid-2000s ($ in millions).

Current solutions are simply not working. A complete shift in the way we treat mental health and addiction must drive the next generation of research and development away from palliative, addictive “half-measures” and towards holistic treatment of the diseases.

Shifting the Treatment Paradigm

A primer on psychedelics

From our article on the origins of psychedelics:

The term “psychedelic” was first used by psychiatrist Humphry Osmond in 1956 during a discussion with Aldous Huxley, the famous author and pioneer of psychedelic consumption. The etymology of the word is derived from the Greek meaning “mind-manifesting”. A more robust definition of the word was developed by Grinspoon and Bakalar:

"a psychedelic drug is one which, without causing physical addiction, craving, major physiological disturbances, delirium, disorientation, or amnesia, more or less reliably produces thought, mood, and perceptual changes otherwise rarely experienced except in dreams, contemplative and religious exaltation, flashes of vivid involuntary memory and acute psychoses."
~ Grinspoon and Bakalar (Multidisciplinary Association for Psychedelic Studies)

Notice that this definition excludes drugs like heroin, methamphetamine, cocaine, and THC, all of which can produce psychedelic effects but are not their primary effect.

The word “psychedlic” is often associated with hallucinogenic effects, but it is possible to take very small doses that are sub-perceptual (a “microdose”) but are still effective. MindMed is exploring the therapeutic potential of both hallucinogenic and non-hallucinogenic doses of Lysergic Acid Diethylamide (LSD – the most widely recognized psychedlic compound, aka acid”) to treat ADHD, anxiety, and cluster headaches. The company is also pursuing a clinical trial pathway for 18-Methoxycoronaridine (18-MC) as a treatment of opioid addiction. 18-MC operates on the dopamine pathway, and has been shown to attenuate large swings in dopamine levels that can be attributed to repeated opioid use and withdrawal.

Discover, develop, deploy

MindMed’s strategy for commercializing their novel psychedelic drug compounds is three-fold, and leverages partnerships to spring-board their clinical trials and establish a product deployment strategy well ahead of FDA drug approval. It is clear that the company’s executives are following a previously successful path forward that wastes no time nor resources. This is Big Pharma strategy being employed by a clinical-stage company. You cannot help but be impressed.

Strategic collaborations

Clinical researchers with psychedelic research experience are a rate limiting factor in psychedelic drug development. MindMed is surmounting this challenge by partnering with leading universities and research centers to gain access to valuable research and previous clinical trial data. The company has partnered with the Liechti lab at the University Hospital Basel (Basel, Switzerland), which has conducted over 10 years of research into the pharmacology of psychoactive substances and boasts 17 completed or ongoing clinical trials, to conduct three drug discovery studies. As part of this collaboration, MindMed has acquired a Phase 2 clinical trial for LSD as a treatment of anxiety. MindMed has also partnered with Masstricht University (Maastricht, Netherlands) to conduct a Phase 2a clinical trial (Read MedicalGold's primer on the FDA regulatory process) for LSD microdosing as a treatment for adult ADHD. The company’s acquisitive approach to advancing their research objectives is extremely efficient. 

Clinical trial pathways

MindMed’s partnerships are going to be the key to their success. The company’s acquisition of a Phase 2 clinical trial for LSD as a treatment for anxiety disorder from the University Hospital Basel (UHB) is prepared to enter the final Phase 2b component (definite dose-finding study) to establish the optimal dose of the drug for further trials (Learn more about the FDA regulatory process). This study is led by Drs. Peter Gasser and Matthias Liechti from UHB, two of the most knowledgeable researchers in the field with a track record to prove it. The acquisition of the LSD drug asset will save an estimated $8.4M to $26.2M in non-dilutive financing and at least for four years of time [4]. MindMed anticipates beginning the Phase2b study by Q4 2021.

MindMed is leveraging their partnership by the Masstricht research site to investigate sub-perceptual LSD microdosing as a treatment for adult ADHD. The Phase 2a study (a preliminary efficacy study) will begin in Q3 2021 and end in Q4 2021.

MindMed’s clinical study for 18-MC as a treatment for opioid addiction is currently wrapping up Phase 1 (primary safety study) and is poised to enter a Phase 2a study in Q1 2022. The Phase 2a clinical trial will be composed of 32 participants grouped into three cohorts that receive a high dose, low dose, or placebo. The clinicians will monitor withdrawal symptoms and trial completion percentage compared to placebo. The company anticipates completing the Phase 3 trial in Q4 2025.

MindMed’s acquisitive drug development strategy is what truly sets it apart form the competition. The company has an exclusive license for DMT, MDMA, LSD, and psilocybin from the University Hospital Basel. The Liechti lab has completed 13 clinical trials and has four ongoing. This partnership has also produced a LSD “neutralizer” that can abort the hallucinogenic effects of LSD within 20 to 30 minutes, giving the therapist control of the experiential therapy.

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MindMed is playing an active role in creating a path towards commercialization by investing in NYU Langone Medical Center (New York, New York). MindMed has committed $5M over a five-year period to catalyze efforts to recruit and train more psychiatrists and clinical investigators. Once the company’s psychedelic drug compounds are approved by the FDA, they will be licensed by the treatment center and used in conjunction with cognitive behavioral therapy with an initial focus on opioid addiction and alcoholism.

MindMed is also pioneering a digital medicine division for psychedelics by developing “Albert,” a mobile application that provides remote access to psychiatrists and aggregates meaningful clinical data to optimize patient care. More than 60% of all counties in the US do not have access to a psychiatrist. MindMed intends to deploy Albert to support the prescription of their psychedelic pharmaceuticals and democratize access to mental health treatment.

Expansive patent portfolio

MindMed ‘s strategy for protecting their intellectual property is comprehensive of the composition of matter, methods of manufacturing, formulations, novel disease indications and therapeutic areas, drug + drug combination therapies, drug + device combination therapies, dosing protocols, and artificial intelligence/machine learning algorithms. Patent offices do not grant patents to naturally derived or easily synthesized compounds; there must be some degree of innovation that deserves protection. Patents on known substances such as LSD can be obtained based on a new use or disease indication, unique dosing regimen, unique formulations, and novel combinations of known substances (e.g., LSD plus psilocybin). MindMed’s patent prosecution strategy is designed to protect their ingenious approach to treating unexplored mental disease indications using novel formulations, dosing protocols, and combination therapies.

Key Catalysts

MindMed has many near-term inflection points that will drive the stock price upward.

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All-star Team


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Board of Directors

MindMed’s board is stacked with senior industry professionals bring together expertise in the capital markets, the biopharmaceutical industry, R&D and product development. 

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Scientific advisory

Clinical-stage biotech companies rely heavily on the expertise of their scientific advisory board, bringing industry-specific knowledge regarding the basic science and regulatory hurdles that the company will inevitably face. MindMed has constructed an expert team of advisors with subject matter expertise in psychology and neurology, and a proven track record of success in drug development.

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MindMed in the News

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[1] https://www.cigna.com/about-us/newsroom/news-and-views/press-releases/2020/americas-state-of-mind-use-of-mental-health-medications-increasing-with-spread-of-coronavirus

[2] American Psychiatric Association. (2020, October 21). New APA poll shows surge in anxiety among Americans top causes are safety, COVID-19, health, gun violence, and the upcoming election. https://www.psychiatry.org/newsroom/news-releases/anxiety-poll-2020

[3] Agarwal, S. D., & Landon, B. E. (2019). Patterns in outpatient benzodiazepine prescribing in the United States. Journal of American Medical Association, 2(1), e187399-e187399. 10.1001/jamanetworkopen.2018.7399

[4] Sertkaya, A., Wong, H. H., Jessup, A., & Beleche, T. (2016). Key cost drivers of pharmaceutical clinical trials in the United States. Clinical trials (London, England), 13(2), 117–126. https://doi.org/10.1177/1740774515625964


Author owns MindMed shares at the time of publishing and may choose to buy or sell at any time without notice.


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