So the pot sector around the world is down and you’ve lost $$$. Maybe the way to dig your way out is to invest in… illegal drugs?

Last week MindMed listed on Canada’s NSX-like NEO Exchange, raising $C24m ($27m) to sell curious dreams and weird ideas to investors with LSD-based drug concepts.

To be clear, the drugs they’re testing are LSD which is not legal anywhere and Ibogaine, a compound first used by Pygmy tribes in Central Africa, which is only legal in New Zealand.

However, following its market debut MindMed has a market cap of $C136m.

It says it’s developing treatments for notoriously difficult to measure mental health afflictions such as depression, ADHD, and anxiety using Schedule 1 drugs — the most illegal category — LSD, MDMD, psilocybin and LSD.

Right now the IP pipeline is limited to opioid addiction and ADHD, using Ibogaine and LSD.

To put in context what they’re trying to do, mental health afflictions are very difficult to treat because they’re very difficult to measure. Last year trials for an anxiety treatment by Bionomics (ASX:BNO) failed.

MindMed notes the clinical trials into Schedule 1 drugs are legal, and cites the approval by the Food and Drug Administration (FDA) of J&J’s ketamine depression drug Spravato last year. UK-based Compass Pathways received FDA ‘breakthrough therapy’ status for a psilocybin treatment in 2018.

US database of clinical trials,, lists 302 studies into psychedelics around the world. The Australia-New Zealand equivalent lists four based out of those countries.

MindMed is preparing FDA-approved phase two trials for ibogaine to treat opioid addiction and a phase two LSD microdosing trial for adult ADHD.

Clinical trials follow preclinical studies on animals, and are broken up into phase one safety trials, phase two efficacy trials, and broader-based phase three efficacy trials.

While clinical trials into LSD and co are possible around the world, in the US the situation is more controlled.

Trials into cannabidiol (CBD) in the US, which is legal if it comes from hemp, have proved extremely difficult to have approved by the powerful Drug Enforcement Agency and the FDA.

But comparisons of psychedelic-based drugs with the cannabis market are not straightforward.

In the US, cannabis for medical or recreational use has been made legal in many states but is not legal federally, meaning there is a booming market for marijuana as an unregistered drug (one that hasn’t been put through clinical trials).

There is no unregistered market for psychedelics so any drug will have to be trialed and approved by regulators, meaning medications will be traditional drugs rather than operating in the grey area that marijuana currently does in jurisdictions where it’s been legalised.