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Summary
- After cannabis, a new crop of psychedelic firms is debuting on the stock market.
- Magic Shrooms are touted to be the answer for US$ 16-trillion mental health market.
- MindMed & Revive Therapeutics are two upcoming firms dealing with psychedelic therapies.
In August this year, the Canadian government approved a controversial psychedelic treatment for four terminal cancer patients. The recipients were administered the drug found in the so-called magic mushrooms or shrooms, to ease their end-of-life distress.
The move made waves worldwide.
About seven months ago, Johns Hopkins University in United States announced that it was studying the molecular structure of psilocybin, a compound found in psychedelics. The varsity’s newly launched Psychedelic Research Center had received US$ 17-billion funding to study this mysterious hallucinogenic drug that has inspired religious movements for long.
Back home, Health Canada has been granting exemptions to psychedelic research firms under section 56 of the Controlled Drugs and Substances Act (CDSA).
The potential of psychedelic drugs and medicine to treat mental health issues, anxiety, and depression can no longer be ignored.
This ‘Shroom Boom’ is backed by increased legalization, regulation, and solid medical research on substances like Psilocybin (Magic Mushrooms), LSD, MDMA, Ayahuasca, DMT, etc. Regulated administration of psychedelic drugs can significantly reduce psychiatric symptoms, addiction and PTSD among patients.
That is why a new crop of psychedelic firms are fast debuting on Canada’s small-cap stock markets
– Canadian Securities Exchange, NEO exchange and Toronto Stock Exchange Venture. These firms take an established medical approach for their business models.
In the last one year, Canadian markets have become a hotbed for growth-stage psychedelic firms, raising nearly US$ 150 million in the first half of 2020, as per Toronto-based NEO Exchange.
With changing laws and consumer behavior towards alternative therapies and medicines, psychedelic stocks are under the spotlight.
Keeping that mind, let’s look at two psychedelic stocks gaining ground in Canadian markets.
Mind Medicine (MindMed) Inc. (NEO:MMED)
Mind Medicine was the first psychedelic firm to enlist on the Canadian stock exchange NEO.
It is reportedly the first publicly traded psychedelic pharmaceutical company in the world.
MindMed aims to develop therapies from psychedelics substances to address “unmet medical needs” and addiction issues. The company has a psychedelics micro-dosing unit that undertakes clinical trials. Its drug development pipeline based on psychedelic substances include DMT, LSD, Psilocybin, MDMA, and 18-MC.
The company recently announced C$ 25 million public offering.
MindMed aims to grab a share of the estimated US$ 100-billion market for psychedelics. It is currently pursuing phase 2 trials of LSD, microdosing LSD and 18-MC for treating anxiety, suicidal tendencies, ADHD, etc.
The company has partnerships with University Hospital Basel and Maastricht University.
The psychedelic firm posted a net loss of US$ 5.7 million in second quarter 2020 ending June 20, 2020. It ended the quarter with US$ 24 million cash in hand.
The stock is currently trading at C$ 1.18. The scrips have gained over 120 per cent this year.
Revive Therapeutics Ltd (CSE: RVV)
Revive Therapeutics is a specialty life sciences company focusing on repurposing drugs for rare disorders and infectious diseases. It is currently focusing on the clinical development of psilocybinm cannabidiol and Bucillamine substances for rare disorders and infectious diseases.
This nano-cap firm has acquired Psilocin Pharma Corp. Its patent on Psilocybin formulations for capsules, sublingual spray, gel cap, effervescent tablets, and oral strips is pending.
The company has strategic partnership Pharm-Olam, University of Wisconsin –Madison,
Wisconsin Alumni Research Foundation (WARF) and University of South Carolina. The company is targeting solutions for mental health, addiction, and rare diseases.
The Ontario-based firm’s current market capitalization is C$ 47 million. The stocks’ current price to book (P/B) ratio is 6.25, while debt to equity (D/E) ratio is 0.93, as per TMX Group stats. Its 10-day average share trading volume is 1.32 million.
The firm announced approval from the independent Institutional Review Board for “compassionate use of Bucillamine” during COVID-19 treatments
Revive stocks are up 455 per cent year-to-date. It is currently trading at C$ 0.25 apiece.
