The psychedelics space could be a major growth opportunity for a number of reasons.
First, the global mental health market is estimated to be worth over $200 billion. Psychedelic-assisted therapies have the potential to be effective treatments for a number of mental health disorders, including depression, anxiety, PTSD, and addiction. If these therapies are shown to be effective, they could have a major impact on the mental health market.
Second, the regulatory environment for psychedelics is slowly but surely starting to change. In the United States, the FDA has granted breakthrough therapy designation to two psychedelic-based drugs, MDMA-assisted therapy for PTSD and psilocybin-assisted therapy for depression. This designation is a sign that the FDA is taking psychedelic therapies seriously and could pave the way for their approval.
Third, there is a growing public interest in psychedelics. This is due in part to the increasing number of scientific studies showing the potential benefits of these substances. It is also due to the fact that psychedelics have become more mainstream in recent years, with celebrities and other public figures talking about their experiences with these substances.
If the research continues to show that psychedelics are effective treatments for mental health disorders, and if the regulatory environment continues to change, this space could be a major growth opportunity. There are already a number of companies working on psychedelic-based therapies, and if these therapies are successful, these companies could provide a major boost in returns for investors willing to dive into this new frontier investment opportunity.
We take a look below at some of the most interesting stories in the space.
Cybin Inc (NYSEAMERICAN:CYBN) bills itself as a clinical-stage biopharmaceutical company. The company’s mission is to create safe and effective psychedelic-based therapeutics to address the large unmet need for new and innovative treatment options for people who suffer from mental health conditions.
Its goal of revolutionizing mental healthcare is supported by a network of world-class partners and internationally recognized scientists aimed at progressing proprietary drug discovery platforms, innovative drug delivery systems, and novel formulation approaches and treatment regimens. The company is currently developing CYB003, a proprietary deuterated psilocybin analog for the treatment of major depressive disorder, and CYB004, a proprietary deuterated DMT molecule for generalized anxiety disorder, and has a research pipeline of investigational psychedelic-based compounds.
Cybin Inc (NYSEAMERICAN:CYBN) recently provides a corporate update outlining access to capital and upcoming clinical milestones.
“The second half of 2023 will be pivotal for Cybin as we expect topline clinical data readouts from both our Phase 1/2a trial of CYB003, our deuterated psilocybin analog, and from our Phase 1 trial of CYB004, our deuterated DMT molecule. Through a combination of the Company’s recently announced common share purchase agreement from Lincoln Park Capital Fund and the ongoing at-the-market offering, the Company has done an admirable job of securing access to capital in light of current market conditions. The potential access to capital should provide Cybin with the cash runway needed to complete these value-driving clinical milestones and enable us to continue focusing on clinical execution with the ultimate goal of bringing improved therapeutic options to patients in need,” said Doug Drysdale, Chief Executive Officer of Cybin.
CYB003 is the first ever deuterated psilocybin analog to enter clinical development and its therapeutic profile as a potentially differentiated treatment for major depressive disorder (“MDD”) has been highlighted in poster presentations at multiple scientific conferences.
Interim findings from the Company’s ongoing Phase 1/2a clinical trial evaluating CYB003 demonstrated positive observations, including a rapid and short-acting psychedelic response in participants. Participants received single oral doses of CYB003 at 1 milligram (“mg”), 3mg, 8mg, and 10mg, respectively, and all doses were well-tolerated with no serious adverse events reported. Most notably, participants reported meaningful and robust psychedelic effects at the 8mg and 10mg doses, confirming a complete mystical experience was achieved. These interim findings demonstrate that CYB003 was rapid and short acting, and reached a psychedelic effect at low doses, while maintaining a safe and well-tolerated therapeutic profile.
CYB003 is designed to potentially address the challenges and limitations of oral psilocybin. CYB003’s therapeutic profile as a potentially differentiated treatment for MDD is expected to provide consistent and predictable dosing, with the goal of reducing time and resource burden on the healthcare system. U.S. Food and Drug Administration (“FDA”) submission of CYB003 Phase 1/2a data for pivotal studies expected in Q4 2023
If you’re long this stock, then you’re liking how the stock has responded to the announcement. CYBN shares have been moving higher over the past week overall, pushing about 8% to the upside on above average trading volume. Shares of the stock have powered higher over the past month, rallying roughly 8% in that time on strong overall action.
Cybin Inc (NYSEAMERICAN:CYBN) had no reported sales in its last quarterly financial data. In addition, the company has a strong balance sheet, with cash levels exceeding current liabilities ($22.6M against $4.4M).
Soul Tribes International Ministries is a different kind of opportunity in the space. This isn’t a publicly traded company. But it has launched a Reg A investment opportunity as a bond that anyone can participate in. And it may well represent the most interesting opportunity in the space right now because the bonds you can participate in offer a tax exempt return guaranteed at 10%. Interested investors can participate at https://soulbonds.org/.
According to the company’s release, Bonds purchased through the Offering will carry a 10% (ten percent) annual coupon rate of return. In addition, all investment returns derived from bonds purchased through the Offering will be entirely exempt from municipal, state, and federal taxation pursuant to the Organization’s 508(c)(1)(a) status as a Faith-Based Organization (see here for proof of tax-exempt status). As an example, every $10,000 investment will generate $1,000 in interest income per year that is entirely tax-free.
Soul Tribes International Ministries (www.soultribes.org) is a 508(c)(1)(a) non-profit tax-exempt organization at the forefront of psychedelic therapy and spiritual healing for mental illness. We are dedicated to facilitating healing and growth within individuals and communities through traditional indigenous practices, including plant medicine, sound therapy, breathwork, and ceremonial work. We acknowledge the profound impact of trauma on the lives of millions of Americans and are committed to expanding access to scientifically and spiritually validated healing practices that empower individuals to overcome the debilitating effects of trauma through transformative, holistic experiences.
“The introduction of the world’s first tax-exempt psychedelics bond offering represents a significant milestone for the burgeoning psilocybin industry and a positive development for faith-based organizations such as Soul Tribes, as well as the broader community,” said Shaman Bobby Shu, Founder of Soul Tribes International Ministries and Soulbonds.org. “The funds raised through these bonds will not only offer crucial capital resources but also provide investors with a meaningful opportunity to contribute to the well-being of the communities they serve.”
Soul Tribes’ visionary founders played an integral role in the passing of Detroit’s Proposition E (2021), which decriminalized plant-based medicines for therapeutic purposes and authorized the commercialization of related therapy services in Detroit. Building on this legislation, proceeds from the bond offering will be utilized to advance the following four strategic initiatives: Renovation of a 60,000 square foot facility in Detroit to create a cutting-edge hub for psychedelic therapy and spiritual healing, the establishment of a world-leading sacrament dispensary, providing our members with access to sacred psychedelic plant products, the expansion of Soul Tribes’ operations, offering a range of psychedelic spiritual therapy services, and the development of new, inclusive housing infrastructure for veterans in Michigan.
Market research from PMI Market Insights projects the Global Mental Health Market to surpass an estimated value of $525 billion by 2030. Soul Tribes’ management believes in spiritual psychedelics marketplace will emerge as the largest component of this market, representing tremendous potential.
Shaman Shu continued, “The launch of this tax-exempt bond offering is designed to leverage the scale and growth opportunities within the emerging psychedelics marketplace, generating substantial returns for new investors while supporting the establishment of a world-class large-scale psychedelics dispensary at the heart of our mission. Soul Tribes strives to provide access to spiritual pathways, sacred plants, and indigenous practices capable of fostering self-awareness, spiritual connection, and natural relief from anxiety, depression, and other mental health concerns. The net return on these bonds, particularly when compared to other investment opportunities on an after-tax basis, is unparalleled. Our legal opinion provides clarity to our position. And the impact we can achieve with this funding is immeasurable.”
Seelos Therapeutics Inc (NASDAQ:SEEL) is a clinical-stage biopharmaceutical company. It engages in the development of products that address significant unmet needs in Central Nervous System (CNS) disorders and other rare disorders.
The company’s robust portfolio includes several late-stage clinical assets targeting indications including Acute Suicidal Ideation and Behavior (ASIB) in Major Depressive Disorder (MDD), amyotrophic lateral sclerosis (ALS) and spinocerebellar ataxia (SCA), as well as early-stage programs in Huntington’s disease, Alzheimer’s disease, and Parkinson’s disease.
Seelos Therapeutics Inc (NASDAQ:SEEL) recently announced the close of enrollment of its registration directed study of SLS-002 (intranasal racemic ketamine) for Acute Suicidal Ideation and Behavior (ASIB) in adults with Major Depressive Disorder (MDD).
“The close of enrollment of our ASIB study is a major milestone for Seelos and the credit goes to our hard-working clinical team enrolling subjects in this very challenging and difficult-to-treat population. Suicides have devastating effects on families and communities but sadly there is no effective therapy available as of today,” said Raj Mehra Ph.D., Chairman and CEO of Seelos. “We look forward to completing the study and sharing the results in the third quarter of 2023.”
According to its release, in 2021 there were 48,183 suicides in the U.S. and unfortunately, the medical community still lacks an FDA approved therapeutic to treat the symptoms of suicidality. According to the Centers for Disease Control and Prevention (CDC), in 2020, suicides and non-fatal self-harm cost the U.S. over $500 billion in medical and work-loss costs, value of statistical life, and quality of life costs. Suicidal patients who present suicidal ideation and behavior symptoms at an Emergency Department and can be held in the Emergency Department for several days while awaiting an inpatient psychiatric bed. Currently in the U.S., there is a shortage of over 120,000 inpatient psychiatric beds and the average length of hospitalization for a suicidal patient is 10 days.
SEEL shares have been moving higher over the past week overall, pushing about 13% to the upside on above average trading volume. Shares of the stock have powered higher over the past month, rallying roughly 23% in that time on strong overall action.
Seelos Therapeutics Inc (NASDAQ:SEEL) had no reported sales in its last quarterly financial data. In addition, the company is battling some balance sheet hurdles, with cash levels struggling to keep up with current liabilities ($14.1M against $39.2M, respectively).
Other key players in the psychedelics space include Mind Medicine (MindMed) Inc (NASDAQ:MNMD), COMPASS Pathways PLC (NASDAQ:CMPS), GH Research PLC (NASDAQ:GHRS), ATAI Life Sciences NV (NASDAQ:ATAI), Relmada Therapeutics Inc (NASDAQ:RLMD), and AbbVie Inc (NYSE:ABBV).
