Psychedelic Sector Update: The Potential To Cure The Most Vexing Modern Mental Health Ailments
Addiction therapy, anxiety treatments, depression, and ADHD are all massive clinical indications that are ripe for disruption; the available treatments either don’t work at all, don’t work well, or have major drawbacks in terms of side-effects and/or costs. A concerted effort by Big Pharma to suppress psychedelics has prevented much progress in the last 50 years. However, that is beginning to change, and it is beginning to change quickly.
The medical psychedelics industry is just beginning to receive some recognition in mainstream media, and people are becoming increasingly conscious of the potential benefits of psychedelic treatments for mental health.
Introduction
Psychedelics offer human beings a glimpse of God while allowing us to access empathy and a childlike-openness - psychedelic experiences can help boost creativity and quiet the ego, instilling in the user a sense of lasting peace and calm.
The medical psychedelics industry has just scratched the surface, and as more US states vote to legalize psychedelics I expect that psychedelic-based mental health therapies will get fast tracked. Mental health issues are one of the biggest societal challenges in the 21st century, and ancient medicines with a modern twist could hold the key to saving lives and improving millions of people’s quality of life.
We are thoroughly convinced that psychedelics hold the keys to curing many of our modern mental health ailments. As awareness grows, more states decriminalize these natural substances, and more data is gathered from clinical trials I expect many publicly traded companies in the industry to experience a parabolic upward revaluation, similar to the move that the cannabis sector experienced between 2015 and early 2018.
WEED.TO (September 2015 - January 2018)
We are in the earliest stages in psychedelics with only a tiny segment of innovators holding any investment exposure to this revolutionary industry that is poised to make early investors a lot of money while doing a lot of good.
Industry Trends
A sector on the run
The nascent medical psychedelics industry had its first sector-wide rally at the end of 2020, with many stocks in the sector peaking in either December 2020 or January 2021. Since January, the industry hasn’t felt much joy with many medical psychedelics stocks falling 50% or more. One of the bright spots has been MindMed Inc. (NASDAQ:MNMD, CSE:MMED), the largest market cap psychedelics focused company; MindMed shares are up roughly 10% year-to-date:
MNMD (Daily)
MindMed successfully uplisted to the Nasdaq in April and the company’s share price subsequently soared more than 150% over the course of a few trading sessions, before cooling off. Technically speaking, MNMD is in an uptrend, above rising 50-day and 200-day moving averages. Technicals aside, it is the company’s fundamentals that should cause investors to take notice and consider taking a long position. With a pipeline of compounds that could potentially revolutionize the $30 billion+ mental health industry, MindMed is at the forefront of building a new treatment paradigm for opioid addiction, anxiety, and adult ADHD. MindMed is pursuing 3 parallel drug development programs: A Phase 2b study for LSD as a treatment for anxiety, a Phase 2a study for LSD as a treatment for adult HDH, and a Phase 2a study for 18-MC as a treatment for opioid addiction. Each one of these trials will produce valuable data that could be leveraged by the sector as a whole, which has the potential to be extremely market moving. It is also important to note that MindMed has already completed 13 clinical trials, and the company has human clinical trial data sets on psychedelics including MDMA, psilocybin, DMT, and LSD.
The companies with the largest and deepest patent portfolios will be able to both preserve and grow shareholder value as the sector evolves. MindMed has an industry leading IP portfolio:
In addition to its existing IP portfolio, MindMed’s ‘MindShift’ discovery division is developing novel compounds derived from psychedelic substances or synthesized from existing compounds:
When one considers the cost of the opioid epidemic ($2.5 trillion cost to the US economy over four years), and the amount of money spent on mental health pharmaceuticals annually (US$30 billion+), suddenly MindMed’s US$1.1 billion market cap seems pretty cheap.
Addiction therapy, anxiety treatments, depression, and ADHD are all massive clinical indications that are ripe for disruption; the available treatments either don’t work at all, don’t work well, or have major drawbacks in terms of side-effects and/or costs. A concerted effort by Big Pharma to suppress psychedelics has prevented much progress in the last 50 years. However, that is beginning to change, and it is beginning to change quickly.
The medical psychedelics industry is just beginning to receive some recognition in mainstream media, and people are becoming increasingly conscious of the potential benefits of psychedelic treatments for mental health.
In the News
Here are a handful of examples of medical psychedelics going mainstream in the last several weeks:
NBC News - California's psychedelic drug decriminalization is long overdue. I wrote the bill to fix that.
CNBC - ‘Shark Tank’ host Kevin O’Leary: Psychedelic drugs ‘far exceed’ cannabis investment potential
Reuters - Mike Tyson says psychedelics saved his life, now he hopes they can change the world
The Independent (UK) - I’ve experimented with psychedelic drugs to improve my mental health – don’t call me a ‘waster’
“The potential of psychedelics far exceeds the potential of cannabis”
~ Kevin O’Leary
“I don’t believe psychedelics are a panacea, but I think they have a big role...with PTSD, in mental distress depression, suicide prevention and much, much more.”
~ Deepak Chopra
"I believe this is good for the world….If you put 10 people in a room that don't like each other and give them some psychedelics, they'll be taking pictures with each other"
~ Mike Tyson
DISCLAIMER:
The work included in this article is based on current events, technical charts, company news releases, and the author’s opinions. It may contain errors, and you shouldn’t make any investment decision based solely on what you read here. This publication contains forward-looking statements, including but not limited to comments regarding predictions and projections. Forward-looking statements address future events and conditions and therefore involve inherent risks and uncertainties. Actual results may differ materially from those currently anticipated in such statements. This publication is provided for informational and entertainment purposes only and is not a recommendation to buy or sell any security. Always thoroughly do your own due diligence and talk to a licensed investment adviser prior to making any investment decisions. Junior resource and biotechnology companies can easily lose 100% of their value so read company profiles on www.SEDARplus.ca for important risk disclosures. It’s your money and your responsibility.