2023 Will Be The Breakout Year for Psychedelics

With all the twists and turns coming from the U.S. federal government, decriminalization and legalization of psychedelics advancing all across the country, and companies scrambling to secure patents on novel molecules, predictions about the future of an industry as new as psychedelics can be tricky at best. 

There are no sure answers to how the various psychedelics businesses are going to do this year. Some say the psychedelic businesses exist within a hype bubble. The truth is that revenue growth will still be iffy this new year. Psychedelic stocks experience crashes, then revive, in an unpredictable cycle. 

Funding expensive research and development is still creating growth restraint even as it uncovers more positive results for treating mental health conditions. 

But for some industry watchers and business developers, and even in some respected mainstream publications like The Economist, it’s beginning to look like 2023 may be the year when the world starts paying more attention to what is going on in the psychedelics industry. 

And even with the uncertainties, no one is backing down from predictions about a multi-billion dollar psychedelics industry developing over the next few years.

Psychedealia talked to three psychedelics business leaders to get their take on what might happen in 2023:

Greg Mayes, President, and CEO, of Reunion Neuroscience Inc. (NASDAQ: REUN), said, “I think we’re all excited that larger studies have begun to report more robust data supporting the efficacy of many compounds in later stage development in the treatment of depression and post-traumatic stress disorder. In 2023, I think everyone expects that we should be at or extremely close to the first regulatory approval for medicine for mental health use of a psychedelic backbone. From my perspective, that’s incredibly exciting and great news for patients and investors. And I think it’ll ultimately encourage further clinical development and maximization of the opportunity that psychedelics present for treatment options for mental health conditions.

“I think what we’ll see in 2023 is the first potential approval, or being on the cusp of the first approval, which I think will really put to rest any regulatory concerns or overhang over the space. I think that the concerns of regulatory overhang have dissipated. I think what we saw in 2022 was what I call a warming experience or the opportunity for regulators to finally start to say that they are going to designate a couple of companies and programs with breakthrough designation status. They are going to help move companies into phase three pivotal programs. That’s a huge help. I think what’s really driving the regulatory agencies—and what is driving me to get out of bed every day—is that we’re dealing with a mental health crisis in this world. And the agencies want to help companies like Reunion Neuroscience develop safe and efficacious molecules where there’s been no innovation in close to 35 years.

“But what I’d like to also add for 2023 is that I think that psychedelics will continue to be a mainstream therapeutic. They will start to really become part of the vocabulary when people think about mental health, depression and anxiety, potentially addiction, and the potential for other indications, which is truly exciting.”

Dr. Hans Eriksson, chief medical officer, HMNC Brain Health said, “I think there will be new data coming out. We know that there will be phase three data coming out from MAPS, at least. So it seems as if these first studies are aiming at sort of establishing the fact that psychedelics do work. They are followed by larger clinical trials. From our own perspective, we have an ongoing phase two study with prolonged release ketamine conducted in three countries in Europe, where we are using the take-it-home approach. Just the first dose of these medicines are given under physician supervision. So we are already taking the first steps in bringing ketamine out from the physician’s office.”

James Lanthier, CEO, Mindset Pharma commented, “I think what we’re doing is directly tied to trying to piggyback off of the really important work that’s been done over the last few years around what we call first-generation psychedelic drugs. 

“So 2022 for us was really the year where Mindset went from being this high-level concept for a lot of folks, as we were able to articulate it as a business, executing on what we described—which is what we’ve been saying all along has been a major opportunity—is trying to discover and develop novel drugs that hopefully will be optimized and make up for some of the shortcomings in first generation drugs.

“I think 2023 is going to be a really great year because we’re getting ever closer to approval for first-generation drugs. And I think the closer we get, the more we’ll start to see the infrastructure get developed on the clinic side and get more questions answered. There should be a lot of progress with MDMA, the phase three pivotal trials for psilocybin are going to be underway. So all of that is really great because I think that that will just continue to attract more institutional capital to the companies in the space that are doing serious work. I think it’ll continue to attract more real pharma interest to the space. The whole kind of psychedelic medicine moves from being this idea that’s really interesting to talk about, that’s backed by some really great science, to being close to being an on-the-ground reality and an option for patients.”

Dave Hodes

David Hodes is a business journalist based in the Washington D.C. metropolitan area. He has contributed feature articles to several cannabis and psychedelics publications, as well as general business/lifestyle publications, on a variety of topics. Hodes was selected as 2018 Journalist of the Year by Americans for Safe Access. He is a member of the National Press Club, and the deputy booking agent for the National Press Club Headliners Committee.

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