Is the Psychedelics Industry Running Too Fast and Too Furious?

Can psychedelics really treat the wide range of conditions being considered?

Psychedelics researchers keep coming up with news ways to help human health and wellness. And it’s not just mental health issues, such as PTSD and depression. Now chronic pain, stroke, and migraines are on the list as well.

All the new development raises a question: Is this really about the depth and variety of clinical studies going after different health conditions, or is this just hype to accelerate the development of the psychedelics industry as a never-ending cure-all discovery?

A study published in 2022 found a host of nonpsychiatric disorders currently being studied for psychedelic treatment.

Four studies used psychedelics to treat neurodegenerative disorders, and eight studies evaluated treatment options for different forms of pain (chronic, post-operative, post-traumatic). Another 12 studies were found measuring psychedelic use for treating lower back pain and headache disorders. There were also clinical psychedelics studies for inflammatory bowel disease and sickle-cell disease.

By itself, that’s all well and good. And the FDA is right there with some of the psychedelics development, using its four ways of accelerating drug development: fast track, breakthrough therapy, accelerated approval, and priority review.

It was the breakthrough therapy designation that the FDA gave to the MAPS/MDMA work in 2017 that resulted in a final clinical trial, which could lead to an FDA-approved MDMA drug for PTSD by 2024 – the first classic psychedelic to reach this point.

But there are doctors urging more caution going forward. “In my opinion, however, it is vital that we take the time to fully research these potent substances and not fast track them into the drug treatment marketplace,” wrote Dr. Lantie Elisabeth Jorandby, a psychiatrist, in a column for Psychology Today.

She added that while we’re waiting for psychedelic therapy to get the proper signoff by the research community, “let’s make the best use of the mental health drugs and therapies we currently have.”

Perhaps it’s to be expected that the medical community has to take a more careful approach to new ideas in treatment for their patients. There is a lot at stake, not the least of which is their license to practice. Promoting or trying a treatment using a federally illegal substance that is barely out of the clinical trial stage is not a top-of-agenda goal.

But then again…

These doctors see the failed use of antidepressants. They see patients get addicted to opioids. They see patients commit suicide rather than carry on with their daily, multiple-pharmaceutical regimen.

They see patients suffering through all the side effects of these medications. And they are getting increasingly tired of simply shrugging their shoulders with an “It is what it is” resignation regarding the popular pharmaceuticals that they have to use because, well, it’s all they got.

The psychedelics industry leaders and developers believe they are onto something truly and profoundly good for human health and wellness. They are risking millions in research and development to prove it—research and development to bring a new drug to a market that could be worth as much as $3 billion.

Failure is an option, like the crash and burn of Atai Life Sciences (Nasdaq: ATAI) in January after a failed psychedelic drug trial. That resulted in a sharp decline of its already down-trending stock offering, which is now down 63% over this date last year.

Going through the process of finding better ways to better health is not a game. It’s a race to do great things, maybe even find a cure for treatment-resistant depression or a way to stop the progression of Alzheimer’s or any of a number of other difficult-to-treat human health conditions where mainstream medical science simply follows the same standard operating procedure they have used for years. Meanwhile psychedelics researchers are looking harder at their data to see what else they can add to their list of possible treatments.

There are thousands of years of proof that these psychedelics work.

“We didn’t invent the wheel, and we didn’t discover this out of the blue,” Beatriz Caiuby Labate, a Brazilian anthropologist and executive director of the Chacruna Institute, said. “And in many, many ways, all of us are indebted to indigenous peoples and their traditions and their knowledge when we are interested in these medicines.”

Payton Nyquvest, co-founder and CEO of Numinus, told Psychedalia that he thinks why we’re seeing that psychedelics are effective for so many different indications is that they are treating the underlying root cause of what creates a mental health challenge in the first place, which is trauma.

“I think people are getting a lot better education in regards to what trauma is, and how it affects people,” he said. “And I think that maybe the question is: Where do we prioritize psychedelic therapy as a standard of care?”

Nyquvest said that the necessary criteria to diagnose somebody as treatment resistant (for depression or PTSD) is that they have to have tried three other treatments and a bunch of different drugs.

“Frankly, that can make symptoms a lot worse,” he said. “And if we know that these psychedelic interventions can be really effective for people, why are we making them go through something that’s expensive, and long, and potentially making symptoms worse, rather than prioritizing an intervention that can make people’s lives much more improved? And then start to talk about, OK, if there’s still some underlying things here, then we can move to more of a treatment or a symptom management protocol.

“The amount of unnecessary suffering that people have to go through at the moment to get to these kinds of interventions is just ineffective, and creates a lot of unnecessary burden on the health care system and people in general,” he added.

The conversation about trauma should recognize that mental health and physical health “should not be compartmentalized,” he said. “They are deeply intertwined with one another.”

Then there is the pure business angle to consider.

Maybe there is a push to find more indications for psychedelic interventions to attract more on-the-fence investors to one company that has what sounds like a viable, novel drug to treat a different human condition when, in reality, that company is still just exploring potential.

Many investors and entrepreneurs in the psychedelics industry are reminded of the glory days of cannabis – the “green rush” – and are watch the quickening development of the psychedelics industry with a little more caution because of their cannabis industry experiences.

“A lot of the early idealism of cannabis gave way to a race to be the biggest and fastest,” said Bryan Passman, the cofounder of Boulder, Colorado-based Hunter + Esquire, an executive search and advisory firm specializing in the cannabis and psychedelics sectors in an article for Entrepreneur magazine.

There was a wave of top-dollar investors seeking fast returns, get-rich-quick founders with subpar products, and big-money brands that muscled their way onto shelves. As a result, the industry became more difficult and less accessible to the average, mission-oriented founder.

“For better or worse, the psychedelics industry is not about capitalizing everything in the same way, at least so far,” he said.

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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