3 Areas Psychedelics Could Address (and How to Invest in Them)
January 27th, 2021
App, Exclusive, Psychedelics, Top News
Psychedelics have shown promise in the treatment of many treatment-resistant conditions, ranging from major depressive disorder to fibromyalgia. The therapeutic markets for these conditions could be worth billions of dollars per year, which has drawn the interest of both researchers and investors across North America.
Let’s take a look at three areas where psychedelics could play an important role and how investors can gain exposure to the space, including Tryp Therapeutics Inc. (CSE: TRYP), which is taking an especially unique approach to the market.
#1. Mental Health Disorders
Anxiety and depression are two of the largest mental health disorders in the world, affecting over 300 million people worldwide. According to Reports and Data, the market for anxiety and depression treatments could reach $18.9 billion by 2026, despite the ineffectiveness of many existing therapeutic options for large portions of the patient population.
In addition to anxiety and depression, there are a number of other related disorders affecting even more people. For example, post-traumatic stress disorder, or PTSD, affects millions of people around the world and represents a nearly-$1 billion therapeutic market in 2020, according to Research and Markets, despite the limited effectiveness of treatment options.
Psychedelics have emerged as an effective option for treatment-resistant depression, anxiety and PTSD. In fact, the FDA recently approved a ketamine-based nasal spray for treatment-resistant depression last March—the first new antidepressant in decades. The agency also gave psilocybin Breakthrough Therapy status to speed up drug development and review.
#2. Addiction-Related Disorders
More than two million Americans have been diagnosed with opioid use disorder (OUD), and Grand View Research estimates that the global opioid disorder market will grow at a 10.1% compound annual growth rate through 2026. While medication-assisted treatments are effective in some cases, OUD detoxification and abstinence results in a high level of relapses.
Early research suggests that psychedelics could play an important role in treating OUD and other substance abuse disorders (SUDs). In a recent study of 444 individuals suffering from SUDs, researchers found that moderate or high levels of LSD or psilocybin resulted in a 69% reduction in participants meeting SUD criteria after the study.
Many experts believe that the overwhelming urges associated with eating disorders, such as bulimia or binge eating, look a lot like drug addiction. MDMA and other psychedelics act on several brain systems that are affected by those with eating disorders, including the serotonergic and dopamine systems, creating potential treatment options.
#3. Neurological Disorders
The benefits of psychedelics extend beyond mental health to the central nervous system. For example, one study found that psychedelics made at least some improvement in nearly 70% of patients with functional neurological disorder (FND)—a disorder that affects voluntary motor or sensory nervous systems (incompatible with recognized neurological diseases).
In addition to known CNS disorders, psychedelics could play a role in the treatment of less understood medical conditions that involve the CNS, including fibromyalgia. According to Coherent Market Insights, the market for fibromyalgia treatments could surpass $3.6 billion in size by 2026, growing at a 3.3% compound annual growth rate through 2026.
Researchers are only starting to understand the ways in which psychedelics interact with these systems, but if successful, they could prove to be breakthrough treatments.
Investing in Breakthrough Therapies
There are several large companies working on anxiety, depression, PTSD and opioid addiction therapeutics that leverage psychedelics, including COMPASS Pathways Inc. (NASDAQ: CMPS)—the billion-dollar giant in the industry.
Tryp Therapeutics Inc. (CSE: TRYP) is focused on developing compounds for orphan diseases and other diseases with high unmet medical needs. Combining the FDA’s 505b2 regulatory pathways with available third-party preclinical and clinical data, the company aims to shorten development timelines and lower the cost of development.
Using synthetic psilocybin as the active compound the company is developing treatments with increased efficacy, natural blood-brain barrier penetration, enhanced safety and toxicity profiles, and reduced risk of abuse and addiction. The company’s lead candidate is TRP-8802 with Fibromyalgia being its initial indication with several other programs in its pipeline.
Tryp Therapeutics Pipeline – Source: Visual Capitalist
With an exceptional management team, the company is well-positioned to execute on its mission to bring these therapeutics to market. CEO James Kuo, MD, MBA has extensive experience within the life sciences industry, including as CEO of BioMicro Systems, Discovery Laboratories (NASDAQ: DSCO), and the current Executive Chairman of (NASDAQ: IPA)
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