How Close Is The US To A Legal Psychedelics Market?

legitimate, medical psychedelics is gaining ground as an acceptable mental health therapy in clinical trials.

Chances are that you have already seen some of the marketing attempts for psychedelics. There are posters and printouts and popups for recreational “magic mushrooms,” with Amsterdam-based Red Light Holland one of the early promoters.

Yet the future marketing and sale of recreational psychedelics is still an open question in the U.S. Oregon legalized psilocybin in 2020, but only for supervised therapeutic use, to be consumed on the premises where it is purchased.

Recreational psilocybin likely will see its first commercial products sold and marketed in microdoses, similar to the 10-, 30- or 100-milligram cannabis doses seen in edibles and concentrates.

We’re not quite there yet. That’s the future of legalized, recreational psychedelics.

However, a version of that future IS already here via the internet.

Recreational psychedelics already are being sold in the black and gray markets in the U.S., and they’re are being used in greater amounts than ever by 19- to 30-year-olds, according to a National Institutes of Health survey. Anybody can order a bottle of psilocybin capsules right now for as little as $39.97, packaged in a way that looks like any vitamin supplement.

At the same time, legitimate, medical psychedelics is gaining ground as an acceptable mental health therapy in clinical trials.

Getting an FDA-approved psychedelics-derived drug out on the market and set up for prescription use like any other restricted-use drug at your local pharmacy could happen in the next 2-3 years, according to the Department of Health and Human Services.

That outlook, however, has all sorts of trapdoors.

The user experience is profoundly different than, say, popping a popular happy pill like Prozac. You don’t just take your prescribed psychedelic after lunch and then go about your business as usual.

The first prescribed psychedelic was Spravato, a self-administered psychedelic nasal spray by Johnson & Johnson’s Janssen Pharmaceuticals, which in 2019 won U.S. Food and Drug Administration approval for treatment-resistant depression.

But the treatment requires two hours of supervision after ingestion. The patient also must take an oral antidepressant and complete two treatments a week for 4 weeks.

The day of another prescribed psychedelic is getting closer to commercialization, at least in Canada.

In August, Optimi Health Corp., a Vancouver, British Columbia-based company, introduced Blue Serenity, Canada’s first natural therapeutic psilocybin product. The product will be distributed to patients, physicians and researchers in blister packs of eight pills once health authorities give it the all-clear under Canada’s Special Access Program (SAP) or an authorized clinical trial.

Advertisements, awareness campaigns and other marketing tactics have increased the awareness for psychedelic drugs in general, according to Data Bridge market research. Mental disorder treatment is a key driver of increased demand for psychedelic drugs, and rising awareness towards mental health overall is expected to continue the market growth.

Today, psychedelic drugs are still expensive, in part because they are connected with therapy sessions that can last for hours. MDMA treatment protocols can involve 42 hours of treatment with two therapists on site at all times. The process includes two or three eight-hour MDMA sessions and twelve 90-minute psychotherapy sessions for preparation and integration. The estimated cost for the entire treatment is around $15,000, according to one therapist.

Clinical trials are still plodding along looking for ways to make taking psychedelics safer – by taking the hallucinogenic factor out, for instance – but also to broaden the base of people who can take it by making the trials more inclusive of a greater range of people and personalities.

Will we soon be seeing the Hallmark Channel-like TV commercials about psychedelics?

Likely, and maybe sooner than you think.

North America dominates the psychedelic drugs market in terms of market share and market revenue, according to the Data Bridge research. This likely will continue to be the case for the next seven years due to high prevalence of mental disorders in the region and rapid research development.

Major psychedelics business players are keen to follow wherever market revenue is greatest, and they are gathering momentum to build a psychedelics brand for the U.S. market.

It is a curious mix of psychedelics companies and mainstream pharmaceutical companies chasing psychedelics brand inclusion, including:

  • Avadel Pharmaceuticals (Nasdaq: AVDL)
  • Celon Pharma SA (WSE: CLN)
  • Compass Pathways (Nasdaq: CMPS)
  • Cybin (NYSE American: CYBN) (NEO: CYBN)
  • Entheon Biomedical Corp. (CSE: ENBI) (OTC: ENTBF)
  • Hoffmann-La Roche Ltd.
  • GH Research (Nasdaq: GHRS)
  • Hikma Pharmaceuticals (OTC: HKMPF)
  • Janssen Global Services (a subsidiary of Johnson & Johnson Services)
  • Jazz Pharmaceuticals (Nasdaq: JAZZ)
  • NRx Pharmaceuticals (Nasdaq: NRXP)
  • Pfizer (NYSE: PFE)
  • PharmaTher Holdings Ltd. (OTC: PHRRF)
  • Usona Institute
  • Verrian

This list is far from comprehensive. But it represents the level of marketing and branding firepower standing by to be swiftly brought to scale in the psychedelics industry. Pfizer spent $232 million in 2020 just to marketing one drug for rheumatoid arthritis. Imagine the rush to market with an FDA-approved psychedelics drug to treat depression?

Psilocybin does much more than simply treat depression.

“Compared to standard antidepressants, which must be taken for long stretches of time, psilocybin has the potential to enduringly relieve the symptoms of depression with one or two treatments,” said Roland Griffiths, founding director of the Johns Hopkins Center for Psychedelic and Consciousness Research.

Aye, there’s the rub.

Is mainstream pharma going to have to come to terms with what they do to stay in business, i.e., drug treatments for the life of a patient and therefore an ongoing stream of revenue? Or will they be OK with an amazing new drug that practically cures the disease for which it is prescribed – meaning no ongoing sales, but perhaps an unprecedented rollout of billions in revenue?

Then there is this nugget reported in the New York Times: “Even researchers who champion psychedelic-assisted therapy say the drive to commercialize the drugs, combined with a growing movement to liberalize existing prohibitions, could prove risky, especially for those with severe psychiatric disorders, and derail the field’s slow, methodical return to mainstream acceptance.”

There is a real determination among researchers to have a psychedelic in the medicine cabinet as another arrow in the quiver for treating mental health. There are a slew of benefits, for sure:

  • Better mental health outcomes.
  • No side effects.
  • No addiction.
  • A medication that practically cures depression or PTSD or alcoholism.
  • The world wants it.

Big Pharma can help make that dream come true, but the real question is: Do they really want to?

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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