Gavinchuk: I’m not seeing enough nerdy data talk within the psychedelics space

Forget weed crypto

First off, most all of those crypto/cannabis hybrid deals were super cringe, and I never saw the point of combining the two, at least not at the scale at which it happened.

But psychedelics is a different beast, and tech integrations make a lot more sense than they did with cannabis. It makes sense for both B2C and B2B environments. Personalization within trips is important. Psychedelics trips are deeply personal experiences, so the more a company can tailor its offerings to a patient the more beneficial the experience could likely be. And for B2B opportunities, as many of the psychedelics companies of today will be gobbled up by big pharma down the road owning data in a new industry with no brand loyalty is a great value prop for an M&A target.

There are some remnants of data talk, but not enough in my opinion. Some companies are building AI platforms, partnering with technology companies, and inventing new ways of enhancing a trip through data collection and processing. But not all of these companies are hiring the right teams. Always look at who the company has hired, or plans to hire whenever they talk about building data platforms. I want full on nerds, I used to work with a data science team when I was a web developer, and their brains are massive. I felt like an idiot at every company meeting. I want those people attached to the company, not outsourced to some agency halfway across the world.

I shudder every time someone on Dragon’s Den says ‘we are going to the Apple of…. or the Amazon of….’. Namaste Technologies (N.V) did it monthly, they were a bit of Starbucks, Apple, Amazon, and Hilton all mashed into one beautiful disaster. So, who is going to be ‘The Google’ of psychedelics?

I’m surprised I haven’t seen this as a marketing angle, but digging deeper a bit, I think it would actually make sense for a company to pick this vertical and really lean into it.

Dragons Den UK, slightly better than the Canadian version IMO

The end-user

Firstly, the B2B opportunities here are massive. And best of all, tech doesn’t need to wait for regulations around drugs to change, whereas new candidates do. Creating tech around enhancing a psychedelic experience, whether it be music and binaural beats, or something more advanced like Kernel tech, which Cybin (CYBN.N), a company studying psilocybin among other things has partnered with.

MindMed (MNMD.Q) acquired HealthMode earlier this year – a machine learning digital health company. HealthMode allows MindMed to perform clinical trials remotely through wearable tech that collects patient data in real-time. This type of tech is going to be used to help with MindMed’s clinical trials, but I think wearable technology like HealthMode could have far wider implications. Just like Kernel, it’s powerful, yet non-invasive technology.

These technology initiatives also create a more personalized experience for the end-user. Through the use of AI companies can really tailor their offerings to each individual user. And with psychedelics being such an individual and personal experience, I think the most personalized approach possible would be best. Data can also be used to better inform current and future product decisions and marketing campaigns.

Mind Cure (MCUR.C) has also gone in on data. PsyCollage is Mind Cure’s bioinformatics platform used by the company’s research team for product discovery. PsyCollage is advertised as ‘a turnkey resource for the discovery of target receptors, methods, and clinical trial data management. PsyCollage is currently prioritizing lead optimization activities on traditional psychedelics and structurally similar NMEs.

Mind Cure’s initial focus for its digital therapeutics segment is, therefore, to technologically enable, through its iSTRYMTM software platform, the collection of data between and during sessions in an effort to equip clinicians with additional patient feedback to provide data-driven research and insights into their therapy and provide patients with a better therapeutic experience.

How Cybin (CYBN.NE) is integrating new brain imaging technology with psychedelics

In April the company announced a partnership with music technology company LUCID Inc. The company developed a novel machine-learning-based method of integrating auditory beat stimulation to enhance psychedelic trips. Using psychometric and biometric measurements to determine the user’s current mental state and machine learning agents, LUCID systems adaptively predict the optimal musical sequence to help an individual reach their desired state.

This could be a big market, maybe they can partner with a music streaming service to create curated for individual users and templates or suggestions using AI to select the most popular and appropriate for whatever the mood or occasion is. Alexa – I’m doing 7 grams of psilocybin mushrooms, I’m feeling upbeat so I might want to dance a bit when the shrooms kick in. Like some kind of shaman feature. Company X could go to Spotify and say ‘we have x amount of data points showing people tripping on psilocybin who have PTSD really connect to this music, meditation, binaural beats etc.

M&A targets

In terms of a potential future rec market, companies can also ultimately start finding out now who is going to buy psilocybin/MDMA/ketamine the second it’s legalized. This data could put a company ahead years and could make for an extremely valuable acquisition target from say a Pfizer (PFE.N) or Johnson & Johnson (JNJ.Q) who will likely want to mass produce whatever gets past Phase 3 and cleared by the FDA, much like Johnson & Johnson did with Spravato (esketamine).

https://equity.guru/2021/07/26/ketamine-vs-esketamine-why-has-the-fda-only-approved-one-for-depression/

Or, if a company is planning on being a producer/seller themselves gathering data ahead of time on who their own consumers will be could be a massive opportunity. Companies like Numinus (NUMI.V) and Filament Health (FH.NE) who have the capacity and legal authority to produce, test, and sell these compounds through their dealer’s license could also benefit from ramping up their collection efforts for potential B2C customers down the line. Those Health Canada Dealer’s Licenses are rare, may as well get the full usage out of it.

Owning data is typically always a good play, but in psychedelics today there is a vacuum as this is a new and emerging sector. The big players haven’t been established yet, there is no brand loyalty. Will one company go all-in on data and say ‘we are the Google of psychedelics?’. Probably not, but I kind of wish one would.