How Analysts Are Asleep At The Wheel Regarding Psychedelic Stocks

  1. Over 1 billion people needing treatment
  2. Psychedelic drugs can revolutionize treatment for many of these conditions
  3. Psychedelics-assisted therapies can generate enormous savings in healthcare spending
  4. The Mental Health Crisis costs the global economy $1+ trillion per year in lost productivity alone

The U.S. Department of Defense refuses to allow its personal to touch cannabis -- not even CBD, the non-psychoactive (and entirely benign) cannabinoid found in both cannabis and hemp. Yet this same DoD is the world’s largest individual donor with respect to psychedelic drug R&D.

Given the way that Congress caters to the whims of the U.S. defense industry, that’s about as strong a “political inducement” as there is in the United States.

Big Pharma on board with psychedelics

Big Pharma is known to be openly antagonistic toward cannabis legalization.  

Cannabis makes people generally healthier. Multinational drug companies make their fat profits from sick people. And the remarkable complexity of the cannabis plant makes it difficult to come up with effective (i.e. lucrative) drug patents.

For Big Pharma, legalized cannabis is “bad for business”. Unfortunately, multinational drug companies have many “friends” (i.e. paid lackeys) in Congress – as we’ve seen with the politics behind COVID vaccinations.

In contrast, psychedelic drugs are highly amenable to our drug patent system for commercializing new drugs. It’s one of the reasons why there have been dozens of formal clinical trials involving psychedelic drugs in recent years because scientists involved in this research can see the patent opportunities

Big Pharma is already marketing its own psychedelics-based drug: Johnson & Johnson’s Spravato™.

Look more closely at the key distinctions between the cannabis industry and the psychedelic drug industry and it immediately becomes easier to see why many of the home-run hitters in investing are avid bulls for psychedelics – while showing little interest in cannabis stocks.

There has been a little more analyst coverage of psychedelic stocks at the beginning of 2021.

In January, Stifel GMP initiated coverage of Field Trip Health (CAN: FTRP / US: FTRPF) and Cybin Inc (CAN: CYBN / US: CLXPF). It gave both a “speculative buy” rating, with a CAD$8.50 price target for Field Trip and a CAD$5 price target for Cybin.

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Disclosure: The writer holds shares in MindMed Inc, Numinus Wellness, Cybin Inc, and Mind Cure Health. Mind Cure Health is a client of Psychedelic Stock Watch.

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