The new California bill will open the market for Creso’s psychedelic products as it aims to become a first mover in the sector.

Global medicinal cannabis company, Creso Pharma (ASX:CPH), is gearing up to enter the Californian market, following the favourable legislative shift in the US state today.

The State of California senate has just passed Bill 519 – a bill that will decriminalise the possession or sharing of psychedelic drugs.

If passed into law, SB 519 will approve the use of mushrooms, MDMA, LSD, mescaline and ibogaine for combat veterans with PTSD, and people with diagnosed or undiagnosed addictions and mental illnesses.

With this major development, Creso and its target company, Halucenex, will now actively explore a number of go-to market strategies.

“Creso has considerable bench strength which we will leverage, as well as in-country personnel that will be able to progress potential partnership opportunities, regulatory approval processes and future licensing agreements,” commented Halucenex founder and CEO Bill Fleming.

The US opportunity

The AB 519 bill still must go through further regulatory approval from California’s lower house and the Governor of California.

If passed into law, the bill could make a wide range of psychedelic substances, including psilocybin, legal to use and possess for adults over the age of 21, as well as expunge prior criminal offences for use and possession.

The bill was mainly introduced to progress a more health-focused approach to the use of psychedelic compounds, and to address the current mental health crisis in the US.

It also marks a shift in the country towards the acceptance of psychedelic compounds as an alternative treatment route, as marijuana legislation sweeps through the US states.

This recent development will provide Creso and Halucenex with a major market opportunity in California, and the US.

The company intends to capitalise on these opportunities, and has started discussions to progress partnerships and market entry strategies.

Halucenex has started discussions with strategic scientific consulting firm and US-based partner HeteroGeneity, with the plan to accelerate the launch of botanical psilocybin products and compounds in the US.

With all the partnerships and discussions that are taking place, Creso is bolstering its exposure to the US market in an attempt to become a first mover in the psychedelic sector.

“Over the recent months, we have made a number of US focused appointments, and Halucenex have secured multiple partnerships and agreements that will allow the company to pursue the US psychedelics market and become a first mover in the sector,” says non-executive chairman Adam Blumenthal.

“The management team is actively assessing a number of strategies to expedite a US market entry and will leverage our existing partnerships and technical experience in the psychedelics space to unlock further value for shareholders,” he added.

Creso delivered a first-quarter revenue of $1.385 million, an increase of 237 per cent compared to the previous corresponding quarter.

The strong revenue came ahead of its proposed dual listing on the OTCQB market in the US, which is earmarked for the second quarter of this year.

This article was developed in collaboration with Creso Pharma, a Stockhead advertiser at the time of publishing.

 This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.