Since cannabis has become (more-or-less) legalized in North America, public opinion around drug prohibition has changed dramatically and the scientific community is becoming far more vocal about the need to embrace alternatives to traditional pharmaceuticals.
In fact, the government of Canada has already approved the first legal exemptions for using psilocybin as end-of-life therapy since the 1970s. On the US side, Denver, Oakland, and Santa Cruz have legalized its use, while Washington, D.C., and Oregon will be voting for legalization in the November 2020 elections.
While this doesn’t mean that they’re legally available for casual consumption just yet, a team of John Hopkins researchers is calling for “Magic Mushrooms” to be made legally available as medicine, with many other scientists following their rally-cry.
As the psychedelic industry starts out, there are 3 central companies that we’re watching.
Psychedelics for Therapy
Using psychedelics as medication for mental health disorders and addictions is not a new concept. In the US in the 1960s, researchers went down this route; however, with anti-drug campaigns becoming mainstream, these studies were stigmatized and subsequently abandoned.
In 2020, studies are underway right now that use psychedelics for therapy, and early results are extremely promising.
Scientists are using psychedelics like LSD, Magic Mushrooms, MDMA & Ketamine to help treat issues like opioid addiction, depression, PTSD, and alcoholism. In fact, in late 2018, the FDA gave “breakthrough therapy” status to a psilocybin treatment developed by London-based Compass Pathways Ltd.
Breakthrough therapy status has not been declared in over 30 years, which shows the significance of the announcement.
All of these overlapping announcements show that the government, leading scientific bodies, and the public are warming up to the idea of using psychedelics as therapeutic tools.
But beyond just public sentiment, there’s big money being invested in the space.
Compass Pathways IPO
Since this video came out, the first large-scale, mainstream psychedelics IPO has taken place through the Peter Thiel-backed company, Compass Pathways (NASDAQ: CMPS).
This half-billion-dollar IPO has cemented 2020 as the year that psychedelics take off in capital markets. In addition to the incredible valuation at the time of IPO, CMPS managed to go up 70+% in value in its first day on the market, settling back in around 30% higher than its IPO price at the time of writing.
“Too many people are suffering with treatment resistant depression. We are committed to developing innovations, such as psilocybin therapy, to address this rapidly growing problem. Patents help ensure sustainable funding to conduct the highest quality clinical research to bring the best new therapies to patients who urgently need them. If this research demonstrates psilocybin therapy is a safe and effective option for patients, we will price it responsibly with the goal of making it as affordable and accessible as possible.”
– Compass Pathways CEO and Co-Founder, George Goldsmith
As the company blew past initial expectations, Compass Pathways managed to become a billion-dollar company and showed that investors are more than ready to get on the psychedelic trend.
While we typically refrain from pursuing any stock that has already seen such incredible gains, the market reaction to the CMPS IPO is first-hand evidence that psychedelics are ready for the mainstream, expediting our research to find the next CMPS.