You’re in behavioral health, so using psychedelic drugs to treat conditions like PTSD, OCD, anxiety, depression, and addiction isn’t news to you. But what may surprise you is the business community’s growing interest in these treatment modalities.

Now more than ever, investors are clamoring to get into the psychedelic pharmaceutical market. Economists value this treatment sector at $3.21 billion,¹ but experts predict the psychedelic pharmaceutical market will nearly double, reaching $6.33 billion by 2026.

So what’s the deal? Why are investors so eager to participate in the ‘shroom boom? After all, these treatments are only legal in Oregon² and a handful of cities across the country. What is it about psilocybin and other psychedelic treatments and therapies that has everyone from clinical providers to capital investment firms so excited?

From Counterculture Contraband to Capitalist Candy

Venture capital firms, independent investors, and hungry startups are actively pursuing the psilocybin market. These organizations see the value in psychedelics—both as an effective treatment modality and a money-maker.

It’s Raining Mushrooms—and Money

Investments in psychedelic treatment companies first attracted attention in September 2020 when Compass Pathways³ raised $146 million in its initial public offering.⁴ This eyebrow-raising sum was doubled in 2021 by another round of investment into Compass. Their second round raised $144 million in April 2021.⁵

Since then, venture capital firms can’t get enough of pharmaceutical companies specializing in psychedelics. As of January 2022, 11 firms have invested $140 million⁶ in psilocybin treatment.

Of course, the venture capital firms investing in psychedelic pharma are just as new as the treatments themselves. Most of these businesses were only founded in the last three years.

Mindstate’s MDMA Momentum

Mindstate Design Labs⁷ is the most recent company to ride the wave of psychedelic investment. In early 2022, a group of venture capital firms announced an $11.5 million investment into Mindstate.

Mindstate Design Labs created a treatment using MDMA (colloquially referred to as ecstasy) to help patients struggling with PTSD. After their success with MDMA, this company is currently developing controlled treatment solutions with psilocybin.

While Mindstate Design Labs may be one of the best known instances of venture capital investment into psychedelic pharmacology, they’re far from the only company working to develop these treatments.

Why Is There So Much Psilocybin Investment?

This begs the question, “Why are these companies slinging tens of millions of dollars around on a treatment that most Americans can’t even legally access?”

1. Research Remains Promising

More and more research is being conducted on psychedelic remedies to treat many behavioral health conditions. And most of these studies reinforce previous research, which has shown psilocybin to be a viable treatment option for patients suffering from debilitating cognitive and behavioral health diagnoses.

Most recently, The Journal of Nature published its Phase-III clinical results⁸ for MDMA-based treatments. Their research found that two-thirds of patients with severe PTSD saw their symptoms reduced to undetectable levels after three MDMA sessions. This is an incredible breakthrough for individuals with PTSD, a condition affecting far too many Americans—including many of our military veterans.

2. Legalization is Near

Although psychedelics have been illegal in the U.S. since 1970,⁹ many states and cities are taking matters into their own hands. Oregon is the only state where psilocybin is legal, but many other states, including Washington, have bills on the table to make psychedelic treatments available to their residents.

Federal organizations are encouraging these efforts toward legalization. In 2019, the Food and Drug Administration (FDA) gave psilocybin “breakthrough therapy” status¹⁰ to promote additional research and accelerate the drug approval process.

3. Consumer Confidence is Increasing

For many Americans, psychedelics are still a taboo subject inextricably linked to the counterculture movements of the 1960s and 70s, when they were first widely discussed in the news and popular culture. Where education about these drugs has been available, it has predominantly continued this narrative, focusing solely on the potential dangers associated with unregulated, recreational use and with little to no mention of potential benefits when administered in a therapeutic setting.

But because of increased economic investment, promising research, and growing legalization, people are changing their minds about psychedelics. Now more than ever, the public is becoming aware of the treatment benefits of drugs like psilocybin and are eager to see these life-changing therapies become available in their states.

A Good Website Makes a Great First Impression

Ready to get started on your psychedelic treatment digital marketing plan but not sure where to begin? Dreamscape Marketing can help. Call us at 888.307.7304 to schedule a strategy call today.

 

For a list of references, please contact us.