The global psychedelic medicine market continues to move forward despite some setbacks, with growth expected to continue at a steady rate over the next five years. Leading players making significant impact on the industry in 2023 include Mindset Pharma, Pfizer, Numinus Wellness, AbbVie, TRYP Therapeutics, Jazz Pharmaceuticals, and MindMed.
The industry has faced recent challenges. Field Trip Health and Wellness Ltd. announced that, in an effort to cut costs and stabilize expenditures, the company would be closing several of its clinics. Those affected included Field Trip Health centers in Chicago, Washington DC, Seattle, San Diego, and Fredericton.(1)
Another blow to the nascent psychedelic space came with the collapse of Synthesis Institute. Founded in 2018, Synthesis sought to bring psychedelic therapy to the masses, but struggled following a series of expenditures. One of these was the acquisition of their proposed Oregon facility, a sprawling 124 acre site in Jackson County. Unfortunately, the county opted to confine psychedelic service centers to a narrow corridor of commercial zones, prohibiting such sites elsewhere. This, along with other factors, led to Synthesis Institute suddenly declaring bankruptcy, sans an organized communication strategy to inform staff or students enrolled in their psychedelic facilitator training program.(2)
Further complicating matters for forward-looking psychedelic entrepreneurs was a late 2022 vote by 25 Oregon counties to restrict or outright prohibit psychedelic healing centers. This dealt a blow to several players at the state level.(3)
However, the industry continues to move forward.
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Corporate Partnerships and Funding
In the business sector, Psychedelic Therapies Inc. announced a partnership with a leading pharmaceutical company, Johnson & Johnson, to develop novel psychedelic compounds for mental health treatments. This partnership aims to leverage the expertise of both companies in the field of psychedelic research and development. The deal is expected to accelerate the development and commercialization of psychedelic therapies for mental health disorders.(4)
Meanwhile, MindMed, a leading psychedelic medicine biotech company, secured $50 million in a Series B funding round. The funds will be used to advance the company’s diverse pipeline of psychedelic-inspired medicines and experiential therapies.(5)
Clinical Trials and Scientific Studies
In the realm of clinical trials, COMPASS Pathways announced promising results for its psilocybin-based psychedelic treatment, COMP360, showing a reduction in symptoms of treatment-resistant depression (TRD). The treatment is currently under investigation in a pair of Phase III trials. Despite these advancements, the industry faces challenges, including the federal prohibition and high restrictions on psilocybin, which will need to change for companies to make profits from their therapies.(6)
Filament Health Corp touted interim safety reporting from its Phase I clinical trial. Healthy subjects received doses of Filament’s botanical psilocybin and psilocin drug candidates, PEX010, PEX020, and PEX030, marking the first reported clinical trial results for a naturally sourced psychedelic drug. The drug candidates showed good tolerability, with fifteen doses administered without serious or unexpected adverse events.(7)
Similarly, MAPS (Multidisciplinary Association for Psychedelic Studies) declared the completion of its Phase III clinical trial for MDMA-assisted psychotherapy for PTSD. The results showed a significant reduction in PTSD symptoms, with 67% of participants no longer qualifying for PTSD after three sessions.(8)
A study published in the Journal of Psychopharmacology in April 2023 revealed that psilocybin, the active ingredient in magic mushrooms, could potentially help reduce opioid dependence. The study suggested that psilocybin-assisted therapy could provide a promising approach in addressing the opioid crisis.(9)
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Regulatory Changes
March 2023: The state of Washington saw movement with its pilot program designed to allow veterans and first responders access to psychedelic medicine. The bill, sponsored by Sen. Jesse Salomon (D), passed the state Senate as well as the House Committee on Health Care and Wellness. The move is part of a broader trend towards the decriminalization of psychedelics across the United States.(10)
May 2023: Colorado Governor Jared Polis signed the Colorado Psychedelic Bill, which will implement changes to the voter-approved ballot measure Colorado Prop. 122, which legalized the adult use of naturally occurring psychedelics like psilocybin, mescaline (not derived from peyote), ibogaine, ayahuasca, and DMT. These changes put in place certain guardrails for non-licensed psychedelic facilitators and for cultivating natural psychedelics for personal use. It also charged the state Department of Revenue with regulating psychedelic manufacturing, distribution, testing, and certain business activities.(11)
May 2023: The American Medical Association gave the green light to three new current procedural terminology (CPT) codes for psychedelic therapies. These codes, essential for classifying treatments and processing insurance claims, were lobbied for by COMPASS Pathways in partnership with a subsidiary of MAPS.
Essentially, CPT codes allow providers across many different areas of the health industry to utilize a common language for tracking and billing psychedelic therapies. However, the new codes will not go into effect until January 2024, and will likely benefit COMPASS and other companies such as Atai Life Sciences. Regulatory approval for the commercialization of their therapies may not be obtained until after that deadline. (12)
The Future of Psychedelics
In addition to the aforementioned regulatory changes, the Oregon Health Authority began accepting applications for psilocybin service licenses in January 2023, with new psilocybin service centers expected to open their doors to clients throughout the year. This development is a significant step in the state’s implementation of Ballot Measure 109, which was passed in November 2020 and directs the Oregon Health Authority to license and regulate the manufacturing, transportation, delivery, sale, and purchase of psilocybin products and the provision of psilocybin services. However, significant concerns, such as the prohibitive costs, difficulty accessing care, and a lack qualified providers continue to be key issues.(13)
The U.S. may soon approve MDMA therapy, marking the opening of a new era of psychedelic medicine. This potential approval could significantly impact the treatment of mental illnesses, further legitimizing the therapeutic value of psychedelics. MAPS believes that MDMA to be approved as a treatment for PTSD as early as October 2023. However, time will tell of those estimates have been overly optimistic.(14)
Lastly, the U.S. Food and Drug Administration (FDA) updated its Current Good Manufacturing Practice (CGMP) regulations in May 2023. These regulations contain minimum requirements for the methods, facilities, and controls used in manufacturing, processing, and packing of a drug product, ensuring that a product is safe for use and has the ingredients and strength it claims to have. The update is crucial for the psychedelic industry as it sets the standards for the production of psychedelic substances.(15)
We will continue to watch for developments in the psychedelic industry and provide updates as new information becomes available.
This material is not intended as a replacement or substitute for any legal or medical advice. Always consult a medical professional about your health needs. Psychedelics are widely illegal in the United States, and readers should always be informed about local, state, and federal regulations regarding psychedelics or other drugs.
- Ltd, F. T. H. & W. (2023, March 15). Field Trip Health & Wellness to Close Clinics in 5 Locations. GlobeNewswire News Room. https://www.globenewswire.com/news-release/2023/03/15/2627714/0/en/Field-Trip-Health-Wellness-to-Close-Clinics-in-5-Locations.html
- Kamps, H. J. (2023, March 12). Synthesis Institute collapse is a major setback for US psychedelic therapy. TechCrunch. https://techcrunch.com/2023/03/12/synthesis-institute-collapse
- Majority of Oregon counties vote against psilocybin therapy. (n.d.). Opb. https://www.opb.org/article/2022/11/13/think-out-loud-majority-of-oregon-counties-vote-against-psilocybin-therapy/
- Microsmallcap.com. (n.d.). Psychedelics Transition from Experimental Treatment to Major Pharmaceutical Industry. Www.prnewswire.com. Retrieved June 1, 2023, from https://www.prnewswire.com/news-releases/psychedelics-transition-from-experimental-treatment-to-major-pharmaceutical-industry-301177739.html
- Inc, M. M. (n.d.). MindMed Announces $50 Million Bought Deal Public Offering. Www.newswire.ca. Retrieved June 1, 2023, from https://www.newswire.ca/news-releases/mindmed-announces-50-million-bought-deal-public-offering-847758161.html
- Psyched: Detroit Decriminalizes Psychedelics, Compass To Study Psilocybin For PTSD, Filaments Gets First-Ever FDA Approval. (2023, April 19). Markets.businessinsider.com. https://markets.businessinsider.com/news/stocks/psyched-detroit-decriminalizes-psychedelics-compass-to-study-psilocybin-for-ptsd-filaments-gets-first-ever-fda-approval-1030949999
- Phase 3 Trial Program: MDMA-Assisted Therapy for PTSD. (n.d.). Multidisciplinary Association for Psychedelic Studies – MAPS. https://maps.org/mdma/ptsd/phase3/
- Sharma, R., Batchelor, R., & Sin, J. (2023). Psychedelic Treatments for Substance Use Disorder and Substance Misuse: A Mixed Methods Systematic Review. Journal of Psychoactive Drugs, 1–19. https://doi.org/10.1080/02791072.2023.2190319
- Pathways, C. (2023, May 2). American Medical Association to Issue First New Code for Psychedelic Therapies. GlobeNewswire News Room. https://www.globenewswire.com/news-release/2023/05/02/2658960/0/en/American-Medical-Association-to-Issue-First-New-Code-for-Psychedelic-Therapies.html
- WA bill to legalize psychedelics stalls, but pilot program still possible. (2023, March 31). The Seattle Times. https://www.seattletimes.com/seattle-news/mental-health/wa-bill-to-legalize-psychedelics-stalls-but-pilot-program-still-possible/
- Jaeger, K. (2023, May 24). Colorado Governor Signs Psychedelics Regulation Bill Into Law. Marijuana Moment. https://www.marijuanamoment.net/colorado-governor-signs-psychedelics-regulation-bill-into-law
- COMPASS Pathways Announces Phase 3 Pivotal Program Design for COMP360 in Treatment Resistant Depression at Capital Markets Day | Compass Pathways. (n.d.). Https://Compasspathways.com/. https://compasspathways.com/compass-pathways-announces-phase-3-pivotal-program-design-for-comp360-in-treatment-resistant-depression-at-capital-markets-day/
- Oregon Health Authority : Oregon Psilocybin Services : Prevention and Wellness : State of Oregon. (n.d.). Www.oregon.gov. Retrieved June 1, 2023, from https://www.oregon.gov/oha/ph/preventionwellness/pages/oregon-psilocybin-services.aspx
- MDMA. (n.d.). Multidisciplinary Association for Psychedelic Studies – MAPS. https://maps.org/mdma/
- Center for Drug Evaluation and Research. (2019). Current Good Manufacturing Practice (CGMP) Regulations. U.S. Food and Drug Administration. https://www.fda.gov/drugs/pharmaceutical-quality-resources/current-good-manufacturing-practice-cgmp-regulations
