Psychedelic-based medicine presents a “massive” market opportunity, especially for companies that get in early, a British expert says.

Dr Adrienne Rivlin, a partner in the healthcare practice of L.E.K. Consulting and former University of Oxford researcher, says using drugs like psilocybin, ketamine and MDMA to treat mental health problems such as depression and post-traumatic stress disorder could create a market worth more than US$6 billion within five years.

Standard SSRI antidepressants such as Prozac and Paxil are a US$30 billion market, but they aren’t effective for everyone and can have unpleasant side effects, she notes.

“One of the most promising aspects of psychedelic-based therapies is that they appear to work without some of the most common side effects of other therapies like SSRIs — this would be great news for patients,” Dr Rivlin told Stockhead.

“So in terms of the commercial opportunity, it’s massive.

“And the opportunities for those who move first I think will be greatest. They’ll also make the market.”

Creso, Emyria, and Incannex

Right now there are three ASX-listed companies involved in psychedelics. One is the cannabis company Creso Pharma (ASX:CPH), which on Thursday announced a merger with Red Light Holland, a Canadian company that sells “magic truffles” in the Netherlands. It has also agreed to buy Canada-based psilocybin company Halucenex.

Incannex (ASX:IHL) is trialling psilocybin combined with psychotherapy for patients with severe generalised anxiety disorder and has executed a partnership agreement with Monash University to conduct a world first clinical trial.

Also, Emyria (ASX:EMD) is teaming with Mind Medicines Australia to investigate using MDMA to treat post-traumatic stress disorder (PTSD).

Dr Rivlin says the venture capital community around psychedelics is very active, and she expects to see consolidation in the space.

“We’ll probably see a number of companies in more innovative areas grow to prominence. That includes the ancillary services needed to make these drugs work.”

Older generations might associate psychedelics with the hippy culture of the late 60s and early 70s, Dr Rivlin said, but “that’s not what we’re talking about today.”

Medicinal psychedelics are now administered in a monitored environment in case patients have a bad “trip” — which is safer, and less costly.

Therapies might involve several preparatory visits before administration of the drug itself, which could result in a session lasting for six to eight hours. Then there’ll likely be a therapist session afterwards.

Companies are looking into high-tech solutions such as digital companions that would reduce the amount of human interaction required, so one therapist could monitor more patients at a time, she said.

There are also commercial challenges regarding manufacturing psychedelic drugs to world class standards, as well as ensuring appropriate certification for the therapists, Dr Rivlin said.

A tipping point

There’s been a real paradigm shift in how psychedelics are viewed, thanks in part to the success of cannabis legalisation as well as high-quality academic studies showing the substances could have vast therapeutic potential.

“We’ve got really high-quality academic institutions and individuals, very well-structured plans and well-executed studies, and that means robust evidence,” Dr Rivlin says.

“So from a scientific perspective, we have just got a broader and deeper evidence base from which to form judgments, which we didn’t have before.”

Regulators are also being more thoughtful and deliberative, and while still somewhat apprehensive, the public is becoming more open to psychedelics as well, she said.

“I think part of that would be the experience of cannabis, but I would caution against reading too much across from cannabis to psychedelics because I don’t think the evidence on the medical side of cannabis is anywhere near as strong as psychedelics from a purely scientific and medical perspective,” Dr Rivlin said.

“There’s a big ‘lifestyle sector’ when it comes to cannabis, but people want to take cannabis as part of a carefully researched and managed medicine — not as a lifestyle choice.”

 

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