Psychedelic Movement Sees 2023 Catalysts in State Laws, Drug Trials

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By Tiffany Kary

January 9, 2023 at 12:00 PM GMT

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Welcome to my newsletter on the psychedelics and cannabis industries. The dawn of a new year often inspires optimism. No sooner had I arranged an interview with a psychedelics VC firm to talk about their view of the year ahead, than New York State saw a proposal to decriminalize drugs including magic mushrooms and ibogaine. Here’s why psychedelics advocates and investors are looking forward to 2023.

A shakeout in psychoactive substances

The psychedelics movement had a bit of a split personality in 2022, with one side pushing for rapid access for the masses and the other calling for a more cautious approach. But this year, a number of catalysts look likely to resolve their differences.

Some advocates for hallucinogenic and dissociative drugs believe progress should go slowly, inching ahead with clinical trials that prove the treatments are effective for specific issues such as depression or PTSD, and that their benefits outweigh their risks. Others believe that access to such drugs should be a universal right, and have pushed for decriminalization and legalization by political means — winning a major leap in 2022, when Colorado became the second state to decriminalize them after Oregon.

The two prongs of the movement continue to race each other, with cautious scientists afraid popular use will get out ahead of the understanding of risks such as heart attacks and psychosis, and advocates of universal access afraid that clinical trials could result in expensive pharma-style drugs. Major tests lie ahead for both sides in 2023.

California and New York will offer a gauge of politicians’ and voters’ interest. In mid-December, California Senator Scott Wiener reintroduced legislation that had passed the state’s senate in 2021 but then stalled. A similar proposal in New York was made in early January, sponsored by Linda B. Rosenthal, an assembly member representing the Upper West Side and Hell’s Kitchen in Manhattan. Both proposals would relax laws around certain hallucinogens, including psilocybin, ibogaine and DMT, which is used in ayahuasca. New York’s proposal might allow gifting, religious use and cultivation. Buy Albino Penis Envy Mushroom Online

While such initiatives have become almost commonplace following adoption by major cities like Seattle and Denver, if the two coastal states move forward with relaxing laws around the substances, it could set a precedent for others — and a thriving gray market. Buy Albino Penis Envy Mushroom Online

“I do think it’s significant, because it’s New York,” said Josh Kappel, a founding partner at the law firm Vicente Sederberg, which has helped craft other state initiatives. Buy Albino Penis Envy Mushroom Online

Oregon, the first state to legalize psychedelics, will also roll out therapy this year, with the rest of the US watching for cautionary tales and success stories. Buy Albino Penis Envy Mushroom Online

Such initiatives are a net positive — even for biotech-style companies in the space that are going the regulatory route — because they destigmatize the drugs, said Daniel Goldberg, a co-founder of Palo Santo, a Highland Park, Illinois-based venture capital fund that’s focused on psychedelics. Buy Albino Penis Envy Mushroom Online

The VC firm has only deployed about half of its $50 million fund into 20 companies in the psychedelics space, and fellow co-founder Tim Schlidt said he looks forward to investing more in 2023. Buy Albino Penis Envy Mushroom Online

Key moments he’ll be watching in scientific research include the US Food and Drug Administration’s response to the new drug application that’s expected this year from MAPS Public Benefit Corporation, a private biopharmaceutical company that just announced phase 3 results from a trial of MDMA to treat PTSD. Usona Institute, based in Madison, Wisconsin, is also expected to announce results from a phase 2 study of psilocybin for major depressive disorder this quarter. Buy Albino Penis Envy Mushroom Online

Schlidt said that while he doesn’t see any potential acquisitions by big pharmaceutical companies in the space, there could be licensing deals. “We’re hearing more rumblings from people in business development at big pharma that people are taking serious looks at psychedelics companies,” he said. Buy Albino Penis Envy Mushroom Online

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“We’ll see a lot of the companies which never should have gotten funded will go away,” Goldberg said. Buy Albino Penis Envy Mushroom Online

The news won’t all be positive. Palo Santo’s research indicates that there are around 450 or so companies with some sort of psychedelics business model right now — and a shakeout is likely as the hype around psychedelics dissipates and investors focus in on the actual science and patents. Buy Albino Penis Envy Mushroom Online

Number of the week

• 1,375%The amount by which accidental ingestion of cannabis edibles in children younger than age 6 rose in 2021 from 2017, according to an American Academy of Pediatrics article.

Quote of the week

“In the absence of banking reform, capital will be more challenged this year (both with availability and rates). However, for investable public companies, concerns over looming debt maturities are largely overblown,” BTIG analyst Jonathan DeCourcey said in a Jan. 6 blog post. Buy Albino Penis Envy Mushroom Online

What you need to know

• Canada’s regulated cannabis producers may report another disappointing round of sales in the fourth quarter, hurt by tepid consumer demand and pressure on disposable incomes, Bloomberg Intelligence reports.
• Minnesota Democrats unveiled a bill to legalize recreational marijuana, saying it could become law as early as this year.
• A bill in New York proposes to legalize the possession, use, cultivation, production, analysis, gifting and sharing of “a natural plant or fungus-based hallucinogen” among adults 21 and older. Buy Albino Penis Envy Mushroom Online
• All patients undergoing a procedure requiring anesthesia should be screened for cannabis use, informed of risks, and doctors should consider changing procedures in certain situations, according to first-of-its-kind guidance, issued by the American Society of Regional Anesthesia and Pain Medicine (ASRA Pain Medicine).
• A study published in the Lancet found a single, moderate dose of psilocybin significantly reduces depressive symptoms compared to a placebo condition for at least two weeks. Its funders included Swiss National Science Foundation, crowdfunding, the Swiss Neuromatrix Foundation, and the Heffter Research Institute.
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