The COVID Conundrum For Psychedelic Stocks

Buy low, sell high.

There is no doubt that psychedelic stocks are objectively cheap today.

Industry leader Compass Pathways has fallen by nearly half from its 52-week high, despite indicating it should be ready to report its Phase IIb clinical trial results by year-end, being granted two U.S. patents and sitting with ~US$100 million cash.

Industry leader MindMed Inc (CAN:MMED / US:MMEDF) has fallen by more than half, despite three psychedelic drug trials in Phase II, being recently added to the Russell Indexes, working toward uplisting on the NASDAQ, and sitting with US$162 million in cash.

Cybin Inc (CAN:CYBN / US:CLXPF) recently received a “buy” rating and CAD$8 price target from Canaccord and just after that, it announced a drug development deal with Big Pharma heavyweight, Catalent (US:CTLT). It’s currently trading at CAD$1.40, less than three times cash.

Mind Cure Health (CAN:MCUR / US:MCURF) is preparing to open its first mental health clinic in May, it just named a renowned neuroscientist to lead its ibogaine-based research for the $120 billion Traumatic Brain Injury (TBI) market. Yet it’s trading at less than two times cash.

In the United States alone, mental health drugs and services eat up $300 billion per year. That’s a lot of revenue dollars on the table for the psychedelic drug industry. Yet the collective market caps of these companies is only around $3 billion.

With drug development, even a single drug success can be worth $100s of millions. Psychedelic drug companies already have a half-dozen next-generation psychedelic drugs entering or in a Phase II trial. Dozens of other R&D initiatives are either in Phase I testing or at the pre-clinical level.

Psychedelic drug stocks are not merely a bargain. Today, they are (by far) the single greatest investment opportunity in life sciences.

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William K. 1 month ago Member's comment

The market and need thinking seems strange to me. I seem to associate the term psychedelic with LSD and such types of substances. So evidently there is a new definition of "psychedelic " now. The descriptions of the problems brings to mind that Rolling Stones song about "Mothers Little Helper".

Of course, I define a High Stress situation as "coming under heavy automatic weapons fire, Quite different from some folks thinking.

And so I suppose that the ambient stress level in many areas is hard on some folks.