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3 Ways to Invest in the Nascent Psychedelics Industry

Ryan Allway

June 25th, 2020

Psychedelics, Top News

 

The psychedelics industry is projected to grow from about $2 billion in 2019 to nearly $7 billion by 2027, according to Data Bridge Market Research, representing a 16.3% compound annual growth rate. With ongoing clinical trials and support from the FDA, psychedelics could become a viable treatment option for a wide range of mental health disorders.

There are a growing number of companies in the psychedelics space and each one is taking a unique approach to the market. From wellness clinics to mushroom cultivation to pharmaceutical R&D, there are many ways for investors to participate in the industry’s potential growth. Many of these companies are diversifying or pivoting from the cannabis industry where they already have an operational footprint.

Let’s take a look at three ways to invest in the industry and publicly-traded companies that are well-positioned to capitalize on the market opportunities.

Investing in Clinics

Wellness clinics represent a near-term opportunity to generate revenue in the psychedelics space. For example, some companies are already providing ketamine therapies in the United States where the drug is used off-label for mood disorders. Psilocybin and other psychedelics have also been decriminalized in cities like Denver, Colorado, which could set the stage for wellness clinics to set up shop and help patients in a safe environment.

Empower Clinics Inc. (CSE: CBDT) (OTC: EPWCF) owns and operates a network of CBD-focused clinics in Oregon and Arizona, and provides telemedicine services nationwide with more than 165,000 patients. In addition, the company has a 5,000 sq. ft. production facility in Oregon that manufactures premium health and wellness products for its clinics—including its Sollievo CBD product line.

The company recently launched a psilocybin subsidiary to explore the possibility of expanding into psychedelics. With an existing clinic footprint and manufacturing facility, the company could be in a unique position to expand into psychedelics in the United States.

Investing in Production

Psychedelics face the same problems as cannabinoids when it comes to scaling up production. Since they are plant-based extracts, there is a cultivation and extraction process involved that can be both costly and time consuming. Some companies are perfecting ways to shortcut the process and create purer compounds that could make cannabinoids and psychedelics more potent and cost effective.

CB Therapeutics Inc. is a venture-stage company that has developed a proprietary cellular agriculture platform designed to efficiently research and produce therapeutic compounds. While its initial focus has been on producing cannabinoids for nutraceuticals, the company’s 7,000 sq. ft. fully-licensed commercial batch facility could potentially expand into the cultivation of tryptamines, such as psilocybin and DMT for accredited clinical trials.

The company could become a key supplier of these psychedelic compounds to researchers during the early stages of the industry before moving on to become a producer for commercial companies once the compounds are approved.

Investing in Pharmaceuticals

The pharmaceutical industry provides high-risk, high-reward opportunities for investors. While the clinical trial process is costly and time-consuming, approved drugs enjoy a period of market exclusivity where companies enjoy high margins and barriers to entry. The promise of psychedelics in treating mental health disorders could create an entirely new generation of drugs that effectively address several large multi-billion dollar markets.

Revive Therapeutics Ltd. (CSE: RVV) (OTC: RVVTF) is a life sciences company that’s focused on infectious diseases and rare disorders. Unlike other pharma companies, it prioritizes development efforts that take advantage of FDA incentives, such as Orphan Drug or Fast Track designations. The company’s current operations are focused on COVID-19 treatment possibilities as well as the burgeoning psychedelics market.

The company’s recent acquisition of Psilocin Pharma Corp. underscores its commitment to the research and development of psychedelic therapies and investors may want to keep an eye on its clinical programs given its unique focus on FDA incentives.

This article was published by CFN Enterprises Inc. (OTCQB: CNFN), owner and operator of CFN Media, the industry’s leading agency and digital financial media network dedicated to the burgeoning CBD and legal cannabis industries. Call +1 (833) 420-CNFN for more information.

About Ryan Allway

Mr. Allway has over a decade of experience in the financial markets as both a private investor and financial journalist. He has been actively involved in the cannabis industry since its inception, covering public and private companies.

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CFN Enterprises Inc. (OTCQB: CNFN) owns and operates CFN Media Group, the premier agency and financial media network reaching executives, entrepreneurs and consumers worldwide. Through its proprietary content creation, video library, and distribution via www.CannabisFN.com, CFN has built an extensive database of cannabis interest, assisting many of the world’s largest cannabis firms and CBD brands to build awareness and thrive. For more information, please visit www.cfnenterprisesinc.com.

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