Psilocybin Is Headed for the Mainstream — It’s Bringing the Problems of Big Pharma With It

The psychedelic community is torn over the growing interest in developing medical versions of a drug that may even help treatment-resistant depression

Denver, CO —May 19, 2019: Mazatec psilocybin mushrooms are ready for harvest in their growing tub. Photo: Joe Amon/MediaNews Group/The Denver Post via Getty

As recreational cannabis has inched toward legalization across the western world, scientists and other proponents expect that psilocybin — the active ingredient in magic mushrooms — will be next. This May, both Denver and Oakland, to many people’s surprise, voted to decriminalize it. And now that legalization appears on the horizon, several well-funded firms are jostling to make money in this new market.

Of all the psychedelics that have been studied for their medical potential, psilocybin arguably shows the most promise. Multiple studies have indicated it could help with a wide range of conditions, including OCD, eating disorders, and treatment-resistant depression.

To develop psilocybin commercially into a pharmaceutical-grade product, the drug must be produced synthetically to a medical standard of safety and purity. The nonprofit Usona Institute in Madison, Wisconsin, has been attempting to do this since 2014, refining its chemical production techniques, as well as developing therapeutic models for the treatment of a number of conditions, depression in particular.

As the profile of psilocybin has grown, so too has a cluster of for-profit firms. This includes the U.K.’s Compass Pathways in 2015, the U.S.’s CaaMTech in February 2018, and M2BIO in April 2019, a division of Chinese-owned biotech company MJ MedTech. All are eyeing the size of the psilocybin market since the global market for conventional antidepressants alone was valued at $13.7 billion in 2016, and is projected to grow to $15.9 billion by 2023.

Many researchers applaud the arrival of big business. “We should be seeing it as a sign of our success,” says Rick Doblin, founder and executive director of the Multidisciplinary Association for Psychedelic Studies (MAPS), an influential nonprofit research, advocacy, and educational organization. “There is very little government incentive to get these drugs out to people. Luckily in America, we have some very wealthy individuals who understand the power of psychedelics.”

The highest-profile company is Compass Pathways, which claims to have raised $38 million to produce medical-grade psilocybin for alleviating treatment-resistant depression and was granted breakthrough status by the FDA in October 2018 for its work. Compass was founded in 2015 by Ekaterina Malievskaia, MD; her husband, George Goldsmith; and German entrepreneur, Lars Christian Wilde. Malievskaia and her husband were motivated to develop psilocybin as a medical treatment after witnessing how the mental health system failed in treating their son’s severe depression.

“There is very little government incentive to get these drugs out to people. Luckily in America, we have some very wealthy individuals who understand the power of psychedelics.”

“Our goal has always been to focus on affordable patient access in the most effective way we can,” Goldsmith told Elemental. “We are developing psilocybin treatments for depression at scale — not just small ceremonies in local neighborhoods. This is a global problem that affects 300 million people. It’s very easy for somebody who is wealthy to fly anywhere and receive these substances if they’re moderately ‘plugged in,’ but it needs to be accessible to everyone who is in need.”

Compass’ goals may be admirable, but the company has nonetheless attracted criticism. A 2018 investigation by Quartz claimed that the company is using restrictive contracts to veto publication of any unflattering research conducted by the scientists partnering with the company. There were objections when Compass switched from nonprofit status become a for-profit company in 2016, retaining patents and intellectual property in a move that several former collaborators saw as a deceptive sleight of hand.

In a statement, Compass Pathways said it does not veto or prevent publication of research. “We are committed to open science and to sharing information and publishing clinical results as soon as possible. For research that uses our psilocybin, we retain the right to defer publication of research until patent claims have been filed, should that be appropriate.” It added that the only assets transferred from the non-profit to for-profit company were the name and branding materials. “These were purchased from the non-profit in a transaction that was independently reviewed and approved by the non-profit’s board of trustees.”

“We realize now that we could have taken more time to communicate with researchers who supported us during our early nonprofit stage,” wrote Malievskaia in a detailed response on the MAPS blog. She said that in 2016, the European Medicines Agency (an agency of the EU that advises on the evaluation and supervision of medicinal products) had urged them to refocus on developing a treatment for depression rather than relieving anxiety in terminal cancer patients. Regulatory hurdles and more extensive research would push costs up to $130M, and make it impossible for Compass to exist as a not-for-profit.Thus, the change in Compass’ status.

Developing and testing synthetic drugs is expensive and complicated. Treating one patient with psilocybin and combined therapy in Imperial College London’s clinical trials costs £2,000 ($2,490). And while psilocybin is a naturally occurring molecule, the chemistry to develop a standardized synthetic version deemed safe by medical authorities is complex. Though Compass has been criticized for patenting its chemical process and therapeutic model, this is standard practice for pharmaceutical companies hoping to recoup the costs of research and development.

“These are not rapacious capitalists — they aren’t like pharmaceutical companies who buy the patents to important medicines, then raise the price by 20 times,” says Doblin. “As long as Compass doesn’t attempt to block other companies from developing their own method of producing psilocybin, I have no problem with them operating in a manner that maximizes profits.”

Goldsmith says he finds the accusation that they are attempting to monopolize therapy for treatment-resistant depression irrational. “There are half a dozen organizations also seeking ways to develop new medicines for treatment-resistant depression. The size of this problem is so large, we will need innovations from many different sources. No one single medicine ever works for everyone.”

Goldsmith and Malievskaia may well be pragmatic professionals working within the system to bring a new drug to market as quickly as possible. Yet, many psychedelic researchers find the tactics of these new investors clumsy, proprietary, and antithetical to the traditional cooperative spirit of the community.

“It is troubling that substances that have traditionally been linked with healing and spiritual growth are at risk of becoming monetized as commodities,” says Bruce Tobin, director of TheraPsil, a group of Canadian physicians working to make psilocybin legal for treating severe psychological distress. “Those of us in the ‘old vanguard’ have been motivated by the prospect of advancing the human condition. Profit for individuals at the expense of the public interest is anathema to us.”

Some have raised concerns at the political nature of the money flooding into the industry. MAPS recently received a donation of $1 million from the investor Rebekah Mercer, whose wealthy family has financed Donald Trump, Steve Bannon, and Breitbart and owns part of the controversial data company, Cambridge Analytica. Compass took an initial investment from PayPal co-founder and billionaire Peter Thiel. Palantir, the data analytics firm Thiel co-founded, has been widely criticized for facilitating the National Security Agency’s surveillance of American citizens and the separation of immigrant children from their families at the Mexican border.

“Companies investing in psychedelics, of course, will be motivated by a desire to improve the human condition, but they will also be motivated by profit, which invariably will skew things,” says Adam Winstock, MD, of University College London, an addiction medicine specialist and founder of the Global Drug Survey. “That’s the case with the pharmaceutical industry time and time again: good intentions are marred by the drive to maximize revenue.”

Purists in the recreational psychedelic community may recoil at the thought of psilocybin being commodified or patented by for-profit companies. Yet, cultural change is necessary if these drugs are to be made available to a much broader community of people who could benefit.

“My view is straightforward: most of the people who will benefit from our research will never even have heard of Peter Thiel — they want a medicine that will help them when other medicines won’t,” says David Nutt, head of the Neuropsychopharmacology Unit at Imperial College London and chair of the Compass scientific advisory board. “If, at present, the only way to get that medicine is through a for-profit company, then that is how it has to be. Maybe it’s not ideal, but we spent 50 years doing nothing, and it’s time we did something.”

Update: This story has been updated to include additional comment from Compass Pathway, and has corrected the date in which CaaMTech was founded.