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September 25, 2022


Investment information for the new generation

The mushroom market roundup – who to look out for in 2021 featuring TRIP.C, MMED.E, XPHY.C, NUMI.V, and PULL.C

The notion of magic mushroom market offering after the legalization of cannabis has been floated time and again since long before cannabis legalization was even on the table. It would be late night at parties among my older friends who after they finished their mandatory rant on how cannabis should be legalized and regulated and the amazing taxation benefits reaped went on to suggest, almost as an afterthought, that mushrooms would follow shortly after.

As it turned out they weren’t wrong about the order—just the impact. The impact, as we know from cannabis, was largely overhyped because the demand for both a medical and recreational market was largely smoke. The general idea that everyone would pile into dispensaries to get their legal weed once there wasn’t exorbitant stigma and jail-time attached never materialized. There was a market, but it wasn’t as big as was hoped.

But you live and you learn, right? Now we have the burgeoning mushroom market—not yet legal up here in Canada—but open for business in parts of Europe, and a few forward-thinking hotspots


in the United States. As an aside, Red Light Holland (TRIP.C) has been busy making inroads into Europe with their truffles, and I’d be willing to concede that they’re may be the exception that probes the rule, but it’s early yet. Their chart looks sharp as a result, as well.


Anyone who has done mushrooms over subsequent weekends will tell you that the overall effect is different each time. It’s a hallucinogen, yes, but it’s experiential axis hinges on self-reflection. Some get giggly like on weed, and others just sit and watch the strange wiggly maggots on their friend’s wall before going for a midnight walk through a landscape reminiscent of the Cabinet of Dr. Caligari. (Which was 10/10 cool and something I would totally do again.) Predominantly, though, the experience is internal, and often hard to face for those dealing with trauma, or a battered conscience.

Unless there’s a company out there somehow working the formulations to exclude or reduce the probability of a bad trip, then it’s probable that there’s not going to be much of a demand for recreational mushroom market. I haven’t seen anything approximate, at least. So instead of a regular mushroom market with supply and demand leading to reliable revenues, demand will consist of a niche market supporting cast of psychonauts and quasi-guru’s and maybe the meditation crowd. The prospect of seeing a middle-aged white woman or your grandmother—two lucrative demographics responsible for CBD being what it is—tripping balls on mushrooms aren’t good.

Unless, of course, it’s in a clinical setting and that’s a whole new arrangement.

Enter companies like Mind Medicine (MMED.E) and Xphyto Therapeutics (XPHY.C). Xphyto’s taken a hiatus from developing mushroom therapies to develop products to fight COVID-19, but once the


pandemic’s in the rear view, they and their German subsidiary Vektor Pharma TF GmbH will return to their research on using psilocybin compounds to treat mental health complications like depression, anxiety, addiction, anorexia and posttraumatic stress disorder.

MindMed is a bit of a different story altogether. Their focus isn’t just on psilocybin, but instead has expanded out to include various other forms of psychedelics, such as LSD, DMT and Ibogaine. Remember a few paragraphs ago when I wrote that psilocybin would never have a market if the trip weren’t predictable and controllable? MindMed is looking for that psychedelic dimmer-switch, but not for psyilocybin


—they’re looking for it with lysergic acid diethylamide, or LSD. Now let’s assume that this news isn’t just grist for the hype mill and MindMed actually lands and isolates the series of enzymes or other catalytic agents necessary for shutting off areas of the brain involved in a hallucinogenic trip. If it could be generalized along all psychedelic treatments, it could go a long way towards legitimizing psychedelics for treatment.

Finally, there are a handful of companies waiting for the final green light on legal psilocybin. Okay. Technically, Numinus Wellness (NUMI.V) isn’t waiting. Instead, they’re focused on research right now, having just finished their first extraction of psilocybin for research purposes. They have jumped through all of Health Canada’s regulatory hoops, including licenses, scientific expertise and technologies to facilitate innovation, but intend to use their knowledge and learnings to get into the medical mushroom market once its open for business.

Seriously, the scene in Pemberton seems like it’s straight out of Skyrim.

Pure Extracts Technologies (PULL.C) is busy building out their mountain refuge in snowy Pemberton to include both functional mushrooms and research and development on psilocybin mushrooms under a dealer’s license.

A dealer’s license allows a company to acquire controlled substances, whether it be via import, synthesis, propagation, cultivation and harvesting of mushrooms. It allows for research and manufacture for substances like psilocybin and psilocin, and also for selling mushrooms and mushroom byproducts between businesses, and also the sale of controlled substances by pharmacies.

Acquiring the ability to do the extraction research and development into compounds like psilocybin and psilocin gives Pure Extracts the time to prepare to work with medical doctors, pharmaceutical companies and pharmacies as the process to legalization goes through the clinical trial phase, and onward to the advancement of microdosing.

The move to decriminalize psilocybin, leading to the ultimate goal of a regulated market, got a few forward ticks this year in the November elections. If psilocybin’s progress tracks with that of legal cannabis, then it won’t be too long before it’s up here. It might not be 2021. But that doesn’t mean this isn’t a space to keep an eye on in the coming year.

—Joseph Morton

Full disclosure: Pure Extracts Technologies, and Xphyto Therapeutics are marketing clients.

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