2020 has been a challenging year for the global economy as the world tries to recover from the COVID-19 outbreak. Following the outbreak, we have noticed a bifurcation in the markets where some sectors would considerably outperform others.
For example, companies like Clorox and Amazon have reported impressive growth during the pandemic while restaurant brands and hotels have reported weak revenues and no future guidance. Going forward, this is a trend that we expect to continue, and investors need to be focused on industries that are positioned for growth post-COVID.
During the last two months, hundreds of millions of people have been under a shelter in place order. Currently, it is difficult to measure the impact that social distancing guidelines will have on mental health and believe that this is an area that we need to be focused on as a community.
So far this year, we have seen a rise in the number of people who suffer from some form of a treatment resistant mental health disorder. During the last month, we have conducted due diligence on the psychedelic market and have learned about businesses that are working on therapies for treatment resistant mental health disorders.
Today, we want to highlight 7 emerging biotech companies that are developing therapies for treatment resistant mental health disorders. Included in the list are public and private companies and we believe that these are businesses to be aware of.
- COMPASS Pathways is working on the development of a psilocybin therapy for treatment-resistant depression. In 2018, the company received a breakthrough therapy designation from the US Food and Drug Administration (FDA) for its psilocybin therapy f and we find this to be significant. In 2019, COMPASS completed a Phase 1 study on COMP360 (psilocybin) and reported that the treatment was well tolerated. Later this year, COMPASS expects to complete the world’s largest Phase 2b psilocybin study.
- Numinus Wellness Inc. is targeting the growing number of people who suffer from post-traumatic stress disorder (PTSD), addictions and other mental health issues. The company has a Health Canada licensed laboratory licensed to conduct research on several psychedelics substances and that can leverage psychedelic therapies for treatment resistant mental health disorders. The 7,000 sq. ft. lab is licensed to test, process, purchase, and sell MDMA, psilocybin, psilocin, DMT, and mescaline. The company is working to amend the license to include the production of psilocybin for research and for import and export.
- Mind Medicine Inc. (MMED:NEO) (MMEDF) was one of the first public companies to be focused on the psychedelic market and is working to develop therapies that improve health and alleviate suffering. The company has already completed a successful Phase I trial for MindMed’s lead agent 18-MC, and plans to complete a Phase II trial that will target opioid use disorder. MindMed is assembling an attractive intellectual property (IP) portfolio, clinical pipeline, and drug development platform. The company is developing both hallucinogenic and non-hallucinogenic therapies and is an opportunity to be aware of.
- ATAI Life Sciences is an emerging play on the psychedelic therapy market and has formed strategic relationships to support growth. The company has two separate joint ventures (JV) with DemeRx, a clinical stage pharmaceutical company focused on developing ibogaine and noribogaine for the treatment of opioid use disorder (OUD). ATAI and DemeRx plan to submit clinical trial applications for a Phase II study in opioid-dependence and we are favorable on this opportunity for the companies.
- Cybin Corp. is focused on the development of products and protocols in the psychedelic, pharmaceutical and nutraceutical sectors. The company has an IP strategy that revolves around psychedelic delivery mechanisms, synthetic compounds, extraction methods, isolation of chemical compounds, new drug formulations, and protocol regimens. Cybin is led by a management team that has a proven track record in the biotech industry and we will see if they will be able to replicate those achievements in the psychedelic therapy market.
- Entheon Biomedical is focused on the development of proprietary psychedelic-based products for the treatment of addiction as well as a number of indications that have large unmet needs. The company will initially be focused on the development of a DMT-based treatment and we find this to be significant. Entheon’s future products are designed to mitigate relapse potential in those who are suffering from substance abuse disorders. The company will also be initially focused on nicotine, obesity and opiates. There is no proven treatment for these indications and many people are look for legitimate treatment solutions. Over the long-term, Entheon expects to expand its focus on alcohol and prescription drugs abuse, on PTSD, on major depressive disorders, and on other behavioral disorders.
- Champignon Brands Inc. (SHRM.CN) (SHRMF) was an early mover on the psychedelic therapy market and has recorded major advancements since inception. Last month, the company acquired AltMed Capital Corp, a leading Canadian ketamine clinic operator, psychedelic medicine IP aggregator and novel drug discoverer. The combined company plans to roll out a network of subspecialty therapeutic clinics as a complementary, follow-on service for individuals and families who are suffering from the effects of addiction, depression, PTSD and anxiety disorders. Through the acquisition, Champignon will have three trials in the Phase I stage and three trials in the pre-clinical stage. The combined company will also have seven IP patents for its ketamine/psilocybin delivery platforms and is an opportunity to be aware of.
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