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April 25, 2024


Investment information for the new generation


Psychedelics’ social panacea promise: just more hype? – another psychedelics sector roundup

Naturally occurring psychedelic compounds such as DMT in ayahuasca, psilocybin in magic mushrooms, salvinorum A found in the salvia divinorum mint species, mescaline from peyote cacti and the scolpolamine found in the Datura plant have been used in ritual healing and spiritual hallucinogenic journeys since humanity learned about the light fantastic.

The 120 hallucinogenic species in our global plant phylum equal the number of plant species we have consumed throughout history and dwarf the 15-20 we currently employ to sustain ourselves. Considering that most of these mind-manifesting plants are still used, means humanity loves to trip more that it needs to eat.


Our penchant for mind-bending walkabouts has been classically attributed to our need to reconnect with nature, our spiritual being and the community that surrounds us. More recently and especially since our return to studying psychedelic-assisted psychotherapy, the associated ego dissolution with chemically letting go has been touted as a liberal mechanism that draws us closer to our environment, ourselves, and the needs of others.

Recently researchers at the Imperial College of London recommended along with members of MAPS, to bring together Israelis and Palestinians in an ayahuasca-induced peace negotiation because their research indicated psychedelics would break down traditional and cultural barriers, making everyone empathetic and amenable.

But is this a proposed social experiment based on good wishes rather than good science?

Brian Pace, PhD, commented on the celebrated suggestion in a recent article, Lucy in The Sky with Nazis: Psychedelics and the Right Wing:

“It is worth revisiting these studies, however, because there are too many recent counter-examples to continue imagining that psychedelic drugs will transform individuals into trauma-free, progressive, anti-authoritarian citizens. Undoubtedly, psychedelics are powerful tools that have been neglected by society. But have the psychedelic cheerleaders overplayed their hand?”

Psychedelics are a powerful instrument when it comes to altering how we perceive ourselves and our world, but the drugs themselves do not discriminate, providing ‘solace’ to individuals of any philosophical leaning without converting anyone to “gentler” creed.

Neo-Nazi groups have been caught attempting to manufacture DMT to further their cause while other violent white supremacist groups are happily consuming psilocybin mushrooms. Andrew Anglin, founder of The Daily Stormer, tripped balls all through high school doing ketamine, mushrooms, and Robitussin. Still, he became a raving lunatic.

No amount of psychedelics would have made Idi Amin a pacifist or given the recently deposed Cheeto-faced authoritarian-loving insurrectionist a sliver of reality beyond his Adderall-fueled ego and false election claims.

Rather than forcibly shifting the ideological needle which has thorny ethical questions all its own, psychedelics such as LSD have been shown through recent research carried out by Duerler et. al which concluded LSD-induced participants only moved to align with opinions that had already closely mirrored their existing beliefs in direction and intensity.

Psychedelics provide an effective complementary tool in healing trauma and the human soul, but they need to be understood for what they are, a guided amplification of what already exists within. How did we get so far from the truth?

The relationship between leftist credos and the use of psychedelics is merely correlational than causal as liberal thinkers are more apt to do psychedelics than not. Therefore, these individuals are more likely to get involved in scientific studies thus feeding the flawed premise of overly optimistic left-leaning social engineers.

Unfortunately, the psychedelic story continues to be muddied due to the curse of private equity, the same funding force that gave birth to Silicon Valley and amoral corporate monsters like Elon Musk.

Private equity stokes public fervor by selling a beautiful, yet unreal dream. Whether that be market projections, impending technical discoveries or cultural influences, the lie is told so often and so loudly, it is accepted as reality. How honest can Atai Life Sciences be regarding the true nature of psychedelics with a financial sociopath like Peter Thiel backing the venture?

With that in mind, if you can’t trust a unicorn, why should you invest in it?

More deserving are the scrappy start-ups that have managed to survive and prosper without the intervening and coopting hand of private equity and self-interested hedge-fund managers. These are the true innovators in any sector but especially so in psychedelics.

Companies like Mind Cure Health (MCUR.C) with novel digital technologies and drug discoveries servicing unmet needs such as alcohol use disorder and female hypoactive sexual desire disorder. Mind Cure is cashed up and looking at near-term revenues with its ground-breaking iSTRYM digital platform. I like their market cap, management’s clear vision and blue-sky potential. Mind Cure currently trades at a mere $0.32 CAD per share for a market cap of $29.91 million. A real ground floor opportunity.

Filament Health (FH.NEO) is pioneering the botanical extraction and delivery of natural psychedelic medicines. The company has a deep IP portfolio, in-house GMP manufacturing capabilities and a Dealer’s License from Health Canada, through its wholly owned subsidiary, Psilo Scientific. The company currently trades at $0.33 per share for a market cap of $54.45 million.

Field Trip Health (FTRP.T) has developed a ketamine-assisted psychotherapy protocol for the treatment of depression, generalized anxiety disorder and trauma. The Canadian-based company operates clinics across Canada, the U.S. and Europe. An introductory session which includes an initial meeting with the company’s medical team, on-boarding session with your therapist, a psychedelic exploration session and a 30-minute integration session, will cost you $750.00 CAD before tax. Field Trip is very much in growth mode and took a $12.53 million net loss for the three months ending June 30, 2021. A little tough to swallow with a market cap north of $300 million and revenues of $867,400.

Revive Therapeutics (RVV.C), on top of its cannabinoid pharmaceutical portfolio, has recently acquired Psilocin Pharma to advance psilocybin-based therapeutics for treatment of various disease indications and neurological disorders. The Toronto-based firm is also exploring the potential of Bucillamine in a phase III FDA-approved study as a treatment for infectious diseases such as Covid-19. Revive currently trades at $0.56 per share for a market cap of $172.71 million.

Red Light Holland (TRIP.C), based in the Netherlands, is focused on the production, growth, and sale of magic truffles to the legal, recreational market within the Netherlands. Red Light is embracing the recreational market of psychedelics. Not sure how this will play out as North American regulatory bodies continue to study the possibility of medicinal psychedelics and are relatively reticent to rubber-stamp their recreational use. Red Light Holland currently trades at $0.20 per share for a market cap of $63.74 million.

Now for a small cap psychedelic company with “more twists and turns than a twisty turny thing:”

FSD Pharma (HUGE.C) is a biopharmaceutical company seeking to provide treatment solutions for neuro and inflammatory disorders. The company has three drug candidates in its development pipeline:

  • Lucid-PSYCH: a novel psychedelic molecule currently in IND-enabling studies with a targeted treatment of neuropsychiatric disorders such as major depressive disorder.
  • Lucid-MS: a patented, proprietary neuroprotective new chemical entity that has demonstrated in pre-clinical models the potential to reverse and prevent myelin degradation, an underlying cause of Multiple Sclerosis and other neurodegenerative disorders.
  • FSD-PEA: an ultra-micro-PEA compound with the potential to address a range of inflammatory conditions. The drug candidate has completed phase 1 FDA-approved clinical trials with positive topline results and indications for Phase II are currently being evaluated.

The company has no debt and 43.2 million USD in the till as of June 30, 2021. This is a long way from July when FSD unceremoniously ousted its CEO, Dr. Raza Bokhari, for cause. Apparently, Dr. Bokhari had breached court orders, improperly issued company shares and attempted on multiple occasions to misappropriate company funds. Up until Bokhari’s exit, FSD was plagued with allegations of being a pump and dump. I must admit, the ticker of HUGE doesn’t do the company any favors. They should change that as soon as possible.

Luckily and largely without precedent, the interim CEO, who is also the founder of the company, launched an internal investigation in the validity and viability of the company’s Phase II clinical trials of FSD-201 and upon recommendation, promptly put an end to them. However, the independent review which determined the trials to be unproductive, believed there were other viable commercial opportunities for the drug candidate.

So, where’s the value?

With no known cure for MS, FSD Pharma may have some interesting treatment and investment potential. Of course, taking a drug through all applicable FDA-approved trials is costly and time intensive, but there’s cash in the company’s war chest and a less criminally inclined leadership, so perhaps they will be able to leave the chicanery behind and push through to commercialization.

Currently FSD Pharma trades at $1.75 CAD per share for a market cap of $70.86 million.

In conclusion, for the sake of science, the psychedelics sector needs to drop its rose-tinted narrative and send its hype-fueled charlatans packing. For true growth opportunity, keep your eyes on the smaller players. Except for FSD’s earlier incarnation, modest market caps tend to engender a reliable business ethic based on economic, empirical, and cultural realities.

Now I can lean back, rub my eyes, and call this one done. I know I probably missed some worthy contenders, so please let me know and I will include them in the next round.

Pick your winners, do your due diligence, and make this a better world. Good luck to all!

–Gaalen Engen

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