Behind the Wall: Psychedelics Have ‘Absolutely Transformational’ Potential


Editor’s Note: This article is part of Joanna Makris’ Behind the Wall series, where she provides retail investors with the insider scoop on the hottest technologies and trends from today’s business leaders, industry experts and money managers. Today’s discussion is with Dustin Robinson, founder of venture capital firm Iter Investments, an early investor and policymaker in this space.

psychedelic stocks
Source: luckakcul /

This week we go Behind the Wall and take a close-up look at developments in the psychedelic industry.

Our modern love affair with mind-altering substances dates back more than a century. Before the 1868 Pharmacy Act, you could buy opium from your barber, grocer, ironmonger or tobacconist. It was easy to find. My favorite Romantic poets, from Elizabeth Barrett-Browning to Percy Bysshe Shelley, all used it.

Other drugs were legally available too. Queen Victoria used marijuana for menstrual cramps, drank Vin Mariani, a tonic of alcohol and cocaine and enjoyed the ‘delightful beyond measure’ effects of chloroform when it was administered to her during childbirth.

Much of what we know about psychedelics comes from art, music and literature. I could easily spend an afternoon looking at old photos of the Sex Pistols, Andy Warhol and Basquiat while listening to Will Wood’s Lysergide Daydream. Humans have used drugs of all kinds for centuries, but for many psychedelics are most associated with the counterculture 60’s, before the U.S. Congress stepped in to legislate these drugs in 1968.

Fast forward to 2021. Psychedelics have been decriminalized and (partly) legalized. As a Washington D.C. denizen and alternative health kind of person, I was thrilled by D.C.’s Initiative 81, which in March 2021 decriminalized “natural psychedelics including magic mushrooms, ayahuasca, and mescaline.” In lawyer speak, ‘decrim’ doesn’t mean legal; it simply means that possession arrests are low-priority for police.

There’s more. The legalization movement, backed by irrefutable scientific evidence, is slowly chipping away at federal prohibition of psilocybin, MDMA (better known as ecstasy or molly) and other psychedelics. Many experts say the legalization of psychedelic drugs is inevitable, pointing to legislative wins in Oregon, where voters approved a ballot initiative decriminalizing magic mushrooms last year, as well as Denver and Oakland, both of which passed similar laws in 2019.

So what does all of that mean for investing? Anyone who’s watched the meteoric rise (and fall) of marijuana stocks may be wondering if psychedelic stocks will follow a similar trajectory.

To answer that question, I had a lively conversation with Dustin Robinson, founder of venture capital firm Iter Investments, an early investor and policymaker in this space. Robinson characterizes cannabis as primarily non clinical. “A medical market… was really just a pretext to get recreational adult use” while psychedelics are at their core “pharmaceutical and biotech.”

With the movement toward decriminalization of psilocybin (aka magic mushrooms) already “spreading like wildfire,” he discussed the legislation paving the way for broader adoption of a “whole slew of compounds” backed by credible scientific research and FDA approvals.

Here’s what happened.

Psychedelic Stocks: The Time is Now

Robinson, a psychs-focused lawyer, investor and self-proclaimed “man of data and science,” gave one of the strongest endorsements I’ve heard for the legalization of psychedelics as essential medical treatments. But our guest had more than just his opinions to share.

Robinson offered plenty of detail on how the clinical side is working toward broader FDA approvals and how wider acceptance of “microdosing” could accelerate legalization and access to these compounds. He gave us a soup to nuts look at the current state of psychedelic-assisted healthcare and how he envisions FDA-certified facilities rolling out in the future. And for those wondering what psychedelic-assisted therapy looks like in real life, Robinson dishes on all the details.

Like any disruptive industry, investing in psychedelics comes with risk. The illicit nature of the compounds raises questions about just how receptive regulators, physicians and patients will be to this new class of medicines.

Robinson agrees that diligence is absolutely necessary: “It’s kind of surprising at how many relatively sophisticated investors are reading some of these mainstream headlines about psychedelics being a good investment opportunity and they’re like looking for me to do diligence on like illegally-run companies that are producing you know, psilocybin chocolates.”

The industry veteran highlights some lesser-known investment opportunities in this space, including “functional mushrooms” and media plays.

Finally, if you’re still on the fence, Robinson gives a very candid account of his first experience using ketamine. As an experienced, data-driven investor, Robinson understandably takes a Peter Lynch-ian ‘invest in what you know’ approach.

“If you’re going to invest in an ice cream company, you’re going to want to taste the ice cream,” he says. “I thought they turn your brain into mush. Quite the opposite.”

A Brief History of Psychedelics 

If we’re about to explore the medical implications of psychedelics, we need to start with the science. My conversation with Robinson took me to the edge of my seat very quickly. As the veteran psychs investor points out, “there has been very little innovation in the CNS [Central Nervous System] space for over three decades.” More than a century after Queen Victoria, society is still exploring the role of psychedelic compounds in modern medicine.

Okay, so we’re late to the game. But we can see how this ends. Most industry experts agree on the sector’s forward trajectory, which starts with decriminalization and ultimately ends with the legalization of a fairly lengthy list of psychedelic compounds. 

Investors should focus on the secular forces shaping the psychedelic industry. My take: the broader adoption of psychedelic compounds is supported by three secular trends:

  1. A global outcry for effective mental health treatments;
  2. Evolving legislation/regulation/ decriminalization; and
  3. Increasingly positive public opinion.

Also adding fuel to the mental health fire: the Covid-19 pandemic, which raised awareness of the societal toll of mental health conditions. During the pandemic, 4 in 10 adults in the U.S. reported symptoms of anxiety or depressive disorder, up from one in ten adults who reported these symptoms from January to June 2019.

Our mental health is worsening. At the same time, the vast majority of psychiatric drugs were developed decades ago with little understanding about the pathophysiology of neuropsychiatric disorders. It’s increasingly clear that in order to not just treat symptoms but actually cure mental illness, we’ll need to embrace innovative therapeutic approaches.

The Pendulum Swings Both Ways 

Medical use of psychedelics began in 1938, the year Albert Hofmann first synthesized lysergic acid diethylamide (LSD-25). Five years later, he became the first person to ingest LSD.

By 1954 novelist Aldous Huxley dissolved four-tenths of a gram of mescaline in a glass of water, drank it, then sat back and waited for the drug to take effect. Huxley would detail his psychedelic experience in The Doors of Perception. Huxley was “a willing and eager guinea pig” of the psychiatrist Humphry Osmond, one of the first psychiatrists to pioneer the use of LSD as a treatment for alcoholism and various mental disorders in the early 1950s. 

Osmond coined the term psychedelic, meaning ‘mind manifesting.’ Although his research into LSD’s therapeutic potential produced promising initial results, it was halted by the late 1960s for social and political reasons. Drugs like psilocybin and lysergic acid became stigmatized due to their association with the counterculture movement of the time. By the mid-1970s, research had all but stopped and governments had begun criminalizing these substances in earnest.

Now the pendulum has swung the other way. Psychedelics have become one of the most exciting developments in neuropsychiatry today, with the potential to become “absolutely transformational,” according to Robinson. A growing body of research suggests that controlled treatment with psychedelics like psilocybin mushrooms, LSD and MDMA appears to produce both rapid and sustained therapeutic effects across multiple neuropsychiatric disorders, including depression, post-traumatic stress disorder (PTSD) and substance use disorder (SUD). 19th century English essayist Thomas De Quincey was clearly on to something when he wrote that psychedelics had the capacity to “greatly increas[e] the activity of the mind generally, increas[ing], of necessity, that particular mode of its activity by which we are able to construct out of the raw material of organic sound an elaborate intellectual pleasure.”

The bottom line? Psychedelic healthcare is back in the spotlight with the potential to become an essential therapy in the treatment of mental health issues.

A New Therapeutic Paradigm 

The science is compelling. In the first direct head-to-head trial comparing psilocybin with traditional antidepressants, psilocybin was found to be as effective as the leading SSRI (selective serotonin reuptake inhibitor), with significantly lower rates of relapse post-treatment. Psychedelic drugs like LSD and DMT have been shown to promote neural plasticity and development, novel and untapped avenues for treating psychiatric disorders. They also have the ability to work as immunosuppressants, lessening the severity of immune responses.

Pharmaceutical companies are investing heavily in alternative mental health treatments. Venture capital and smart money is investing across all parts of the value chain, including not only drugs themselves but also the ingredients that go into them and the clinics where drugs are administered under strict supervision.

Regulation too, is quickly evolving. The government of Canada has already approved the first legal exemptions for using psilocybin as end-of-life therapy since the 1970s. Here in the States, Denver, Oakland and Santa Cruz have legalized its use, while D.C. and Oregon have approved the decriminalization of psychedelic plants and fungi. 

So with all of these dynamics at play, is now this time to invest in psychedelic stocks? Read on for the full transcript of our conversation. And email me your thoughts on psychedelics at

Joanna Makris: How widespread do you think clinical psychedelics can be? Are they going to be comparable to the medications we know as household names? Or are they going to be something that’s more for a side crowd?

Dustin Robinson: I was just watching a presentation and Rick Doblin [founder and executive director of the Multidisciplinary Association for Psychedelic Studies (MAPS)] was on and he said, “The FDA responds to data. People respond to stories.” And I think that’s absolutely true… Kind of taking it a step further, I think the FDA and institutions respond to data. People respond to stories. 

So as these compounds move through FDA clinical trials and the research proves out… which MDMA [also known as ecstasy or molly] and psilocybin have [already] been designated as breakthrough therapies. MDMA is in Phase 3 clinical trials. Psilocybin is in Phase 2 clinical trials. They’ve already proven out safety, that’s what Phase 1 is all about. [But] as these compounds move through FDA clinical trials and eventually get approved, I think you’re going to see society and people being much more open. But I also think there’s going to be a need to really educate the public and the insurance companies.

That’s why I said, “Institutions and the FDA respond to data.” I think institutions like large insurance carriers will respond to that data. And I think it’s important that we start lobbying these insurance companies now. I’ve spent a lot of time talking to insurance companies. 

So, even after FDA approval — which I believe MDMA will be the next compound, ketamine is already FDA-approved and being used in psychedelic-assisted therapy — I think MDMA will be the next one. Then psilocybin. And we’ll have a whole slew of other compounds as well as analogs and new chemical entities that are psychedelic-inspired coming right after that. 

But even after that, you’re going to need to spend some time lobbying the states to essentially reschedule on their part. First, the DEA [U.S. Drug Enforcement Administration] will have to reschedule and then the states will probably follow suit. But also lobbying the insurance carriers. And then educating the public about this research and sharing those stories of people that have been positively impacted. 

I believe — once all those stories are told and once the public comes around, once the insurance carriers come around as well — I think we’re going to prove that these compounds are absolutely transformational. 

There’s been very little innovation in the CNS [central nervous system] space for over three decades. So people with mental and behavioral health issues are in serious need of some solutions… These compounds are showing a lot of efficacy with a great safety profile. 

It’s my expectation that these will be extremely widespread. It just may take some time. That’s really gonna come with education and really lobbying insurance companies, states and educating the public.

I think a lot of investors are watching the state of the rollout of the cannabis industry. And so I’m wondering, to what extent do you see psychedelics as following a similar trajectory? Or how might they be different?

I get that question a lot from investors — how is this similar to cannabis? Obviously, it’s similar to the extent that these are both Schedule 1 compounds on the Controlled Substances Act. So, cannabis, MDMA, psilocybin, LSD — all these compounds are Schedule 1. That’s about the extent of the similarities. 

Really, the main distinction is that cannabis, when all the dust is settled, is mainly driven by its recreational and adult use. Yes, we’ve kind of had a medical market. But that was really just a pretext to get recreational adult use. And you see that in the states. As soon as they pass medical, the next thing they’re looking to pass is recreational adult use… That’s really where we’re moving on the cannabis side — really just full access, people should have the right to access these plants. 

In contrast, on the psychedelic side, it’s really mainly driven by the science and the pharmaceutical approach. I believe that when all the dust settles in the psychedelic side… a very large part of the market is mainly going to be pharmaceutical and biotech. There will be a relatively small size market for, you know — I guess you’d call it spiritual or entheogenic use that will probably go through states and cities, decriminalizing and legalizing. 

But I think that’s the main distinction. Cannabis is mainly driven by that recreational use, whereas the psychedelic space is really mainly driven by that pharmaceutical use of those compounds.

I think a big question many of us have is what does psychedelic treatment look like in real life? You know, does your doctor prescribe you a prescription and say ‘Take 25 milligrams of psilocybin’ like you would an antidepressant?

Right now, it’s rolling out very differently. You know, in [the] current psychiatric space, if you’re getting one of these SSRIs [selective serotonin reuptake inhibitors] or benzos, you go see a psychiatrist, they write you a prescription, you go to the pharmacy, you go home, you take it, you come and see your psychiatrist a couple months later [and] let them know how you’re doing. 

Under this paradigm, what’s happening under the FDA is that they’re requiring REMS for both the MDMA and psilocybin clinical trials. REMS stands for “Risk Evaluation and Mitigation Strategies.” And what they’re requiring is that these compounds are actually administered at a facility. 

So really what you’re going to see is that it’s not just MDMA being approved, it’s MDMA psychedelic-assisted therapy that’s being approved. It’s the compound in conjunction with very specific protocols that will be administered at a particular clinic. 

And even on the state legalization side — a lot of people don’t realize, you know, Oregon passed Measure 109 but even under that legal framework they are requiring that the compounds are being administered at what they’re calling “licensed service centers.”

Essentially, the way we’re seeing this industry roll out is these compounds being administered at clinics… We are talking to several companies that are also pursuing drug development on the microdosing side. A microdose is basically a sub-psychedelic dose of these compounds, so there’s really no reason to necessarily have to be at a clinic… for administering those compounds.

I do believe in the future, we’ll probably see first these compounds in macrodoses being administered at clinics. But then I think they’re going to start proving out microdosing, which will likely be able to be consumed at home and will start to look a little bit more like the current model that we have today. 

So, initially we would start to see psychedelic specialists at these facilities? What does that mean in terms of the timeframe for mass adoption if we begin the industry this way?

The best place to look is, like I said, Phase 3 clinical trials for MDMA for PTSD, which MAPS is the sponsor… The way that REM is structured is that you’ll need to have the sites certified, but you’ll also need to have the therapists certified as well. 

So there’s going to be a huge bottleneck with respect to training therapists on these protocols, right? These therapists, when they went to school, they didn’t go to school and learn psychedelic-assisted therapy. That really wasn’t a thing — and hopefully in the future that will be a thing in the education for therapists and psychiatrists. But that wasn’t a thing when they were in school. So, we’re going to need to get these therapists certified. 

And quite frankly, I think that’s going to be one of the bigger bottlenecks… Number one, getting these psychiatrists on board and open to the idea of psychedelic-assisted therapy. Then getting them trained. Then opening up actual physical locations that are conducive for this type of therapy. 

The normal white walls, white coats-type of clinical model, quite frankly, I don’t think is going to be what we want in the psychedelic-assisted therapy space. So you’re not only looking to train the therapist, but you’re also looking to build out kind of a new infrastructure from a clinical perspective to administer and deliver these compounds.

How significant is the decriminalization of magic mushrooms in places like Oregon and D.C. in terms of the fight for broader legal adoption? In the late 2000s, you saw states like Colorado and California adopt marijuana very early, long before it became a meaningful industry. What are your thoughts there?

So, in addition to my venture capital firm, I actually have a nonprofit I founded at the end of 2019 called Mr. Psychedelic Law that’s focused on legal reform at a city and state level. We’ve actually drafted several resolutions for decriminalization. We’ve also drafted bills for legalization. We filed a bill last legislative session in Florida. We’re actually filing a new bill in this next legislative session. 

But ultimately, you know, decriminalization is spreading very, very quickly. You had Denver really start out, then you had… Santa Cruz, Oakland, Ann Arbor, a couple cities in Massachusetts, D.C., Oregon through Measure 110. So… the decrim [decriminalization] is spreading like wildfire. 

Now, legalization in my mind is very important to be done in conjunction with decriminalization. Legalization is treating the container, the commercialized container for delivering these medicines. 

I’m very passionate about broad access and giving people these compounds and the ability to explore their own mind — whether or not they have a particular diagnosed indication. But I also think we need to be careful and learn from the mistakes of the 50s and 60s. Because when these compounds got in the hands of people that were maybe misusing them or using them for purposes that maybe they shouldn’t have — and there [are] certainly some political reasons — but the 1970s is when the CSA [Controlled Substances Act] came about and essentially these compounds were put as Schedule 1 which stifled all the research. 

So we want to be very careful. If you look at my nonprofit website, before the word[s] “legal reform,” you’re going to see the word “responsible” in big bold letters. So I’m very passionate about legal reform and getting people broad access… whether or not they have indications. But it’s very, very important that it’s responsible legal reform and we really figure out how this container is going to look.

Let’s talk about some of the individual therapies — psilocybin versus ketamine versus others. Which are the earliest in terms of mass adoption and investing opportunities right now?

I mentioned that MDMA and psilocybin are being approved under REMS. What’s happening now is there’s this play on the clinical side to open up essentially psychedelic centers… that will be able to deliver MDMA and psilocybin. Right now, they can’t do it legally until they’re FDA approved. But what they can do is deliver ketamine.

Ketamine is an FDA-approved compound. Technically, people are lumping it in as a psychedelic. And so it’s being used off label. It was approved as an anesthetic. Many doctors are using it off label for various mental and behavioral health conditions. And a lot of people hear “off label” and they think that’s a bad thing. I think over 20% of prescriptions are actually off label. So it’s a relatively common thing for a compound to be approved for a particular indication, but a doctor to actually prescribe it and use it for a different indication. And that’s what’s happening with ketamine. 

So the opportunity on the clinical side right now is really rolling out ketamine psychedelic-assisted therapy centers with the expectation of adding on MDMA, psilocybin, DMT — all these other compounds as they become approved. That’s kind of the excitement right now around ketamine. And ketamine is an amazing compound. A lot of people don’t realize that we have an FDA-approved compound that is actually showing a lot of efficacy for various mental and behavioral health conditions — and with a great safety profile. 

You know, I’m not necessarily advocating recreational use of ketamine. There’s certainly the potential for addiction. But when you compare it to some of these other SSRIs and benzos, ketamine actually has an incredible safety profile. And so do all these other psychedelics. That’s why they’re getting through Phase 1 so quickly. Because the research is demonstrating that these compounds have really, really strong safety profiles. 

[A lot of the talk] is around the efficacy. And obviously, when you’re talking about indications, you need to prove efficacy. But safety is just as important — if not more important — because something could be as efficacious as you want it to be, but if it gets people addicted or it has all these other side effects, that’s not very helpful. And really, these compounds are showing an incredible safety profile when compared to the current pharmaceuticals.

What’s your advice to investors looking at the space? In terms of thematically how they should be looking at it? Some of the companies that you think are interesting? What are your thoughts?

There’s so many different parts of the industry. There’s the biotech side, which consists of the suppliers of the APIs — active pharmaceutical ingredients. There’s obviously the drug development companies that are emerging. There’s the clinics that will be delivering these compounds. And then what’s really exciting me is also some of the technology and other supporting infrastructure that’s being [built] around this biotech, kind of psychedelic space.

But, you know, there’s also retreats… I’m seeing more and more companies are starting retreats in other countries that allow it. There’s functional mushrooms, which is growing at a very rapid pace. Functional mushrooms are basically legal mushrooms that don’t have the psychoactive component. You [can] kind of compare that to the CBD space. When cannabis was getting all exciting, they pulled out the THC [tetrahydrocannabinol] — which is the psychoactive part of cannabis — and there was this big kind of dietary supplement market for hemp extract or CBD or some of these other minor cannabinoids that aren’t psychoactive. [The] same thing is happening on the functional mushroom side, lots of different companies are kind of emerging around that concept. 

There [are] also a lot of media plays. Our fund actually has incubated a project where we’re essentially rolling up some different media assets because our thesis around that is that psychedelics are becoming more and more accepted and more and more mainstream. So there’s going to be an incredibly large audience, I believe, around psychedelics. Whether you’re a therapist wanting to learn more about it, you’re a patient or consumer wanting to learn more about it, you’re an investor wanting to learn more about it — which is probably the reason people are tuning in today, right? There’s this huge audience and a lot of excitement and people wanting to build community around this. So that’s kind of another aspect. 

I think, really, from an investor’s perspective, you’ve got to figure out where along that value chain you have conviction. Certainly our fund has — we have a very specific thesis in number one, which parts of those value chains we want to invest in. And we have a very specific thesis within that value chain portion: what kind of model. For example, on the clinical side, we have a very specific type of clinical model that we’re looking for when we look to invest in some of these different clinics. So you [have] to decide that.

Then number two would be deciding what type of instrument you want to invest in. Do you want to be a direct investor? Do you want to invest in ETFs? Do you want to invest in venture capital funds? I will tell you right now, there’s a lot of complexity — we have a deep team of lawyers, doctors, scientists on our team. I personally wouldn’t be able to diligence these companies on my own. I’m an attorney, I’m a CPA, I’ve represented investors, I’ve represented companies, but I do not have the tools. And I don’t think any one individual has the tools to properly diligence these companies. 

So that’s where direct investment for some of these investors — even if they’re getting good deal flow — is very, very challenging. In my opinion, it makes more sense to deploy capital into a fund of some sort that would be able to properly diligence and pick out the winners of the industry. 

And there’s also ETFs. But if you look at how the ETFs have been performing, they haven’t been performing very well. [But] that’s another option is the ETFs. And some of the ETFs aren’t straight psychedelic plays. Most of the psychedelic ETFs right now have also several cannabis companies. It’s kind of a mixed bag. So it’s not necessarily a great indicator on the psychedelic market. But those are kind of, in general, what your options are as an investor. 

Maybe it’s too early, but is there some piece of this value chain that you can identify right now as the fastest growing or the highest margin? Is there some sort of sweet spot in the ecosystem right now?

Right now, drug development is where you’re seeing the biggest value creation… The highest market caps of companies are drug development. Compass Pathways (NASDAQ:CMPS) [has] Phase 2 clinical trials for psilocybin for treatment-resistant depression. Mind Medicine (NASDAQ:MNMD) — they’ve got various clinical trials going on. ATAI [Life Sciences] (NASDAQ:ATAI) — various different clinical trials going on… And there’s tremendous value creation. Most of those companies that I just named really didn’t have their seed round until 2018 or 2019 and they’re already on the Nasdaq at over a billion dollar market cap. So that’s kind of where you’re seeing the quickest value creation. 

Very early on, there was a lot of excitement around the clinical model. You’ll see companies like Field Trip (NASDAQ:FTRP) that have several hundred million dollar market caps already. And that’s really what Field Trip [is] focused on — that clinical play. You’re starting to see those valuations on the clinical side kind of soften up as people are starting to understand… the financials around that and some of the regulatory and operational challenges that go along with opening up some of these clinics. But really drug development right now is probably what’s getting the most excitement and creating the quickest value for investors.

As new investors in this space, how do we avoid looking at some of the more legally dubious investments in this space? How do we really separate companies?

It’s funny, I get — you know, in addition to having my venture capital firm and my nonprofit, I also run a law firm and I get a lot of calls from people that want me to help kind of diligence investments. And it’s kind of surprising how many relatively sophisticated investors are reading some of these mainstream headlines about psychedelics being a good investment opportunity and they’re like looking for me to do diligence on illegally run companies that are producing, you know, psilocybin chocolates. And obviously I can’t partake in anything that’s illegal. Everything I do is legal. Biotech is legal — you’re going through the proper federal channels. I would not recommend anyone any investor putting money into a company out of California or Colorado that is developing psychedelic chocolate mushroom edibles. 

I think you really [have] to be educated and understand the legal landscape when you’re dealing with the FDA. These are companies going through drug development. They’re going through the proper federal channels. If you’re dealing with some guy that’s growing psychedelic mushrooms in his backyard or something illegally — those are probably opportunities you don’t want to pursue. 

That’s not to [say] there [aren’t] things to be done and kind of set people up for some of the city and state legalization. There are some different things you could be doing. I mean, we’ve been talking to some of the largest mushroom growers — non-psychedelic mushroom growers — that provide mushrooms to [restaurants], edible mushrooms that you order with your dinner that are non-psychedelic. Those people are very well-trained mycologists that are well-positioned to eventually grow psychedelic mushrooms if it becomes legalized at a state level. 

I know that was a whole lot. But it’s important to understand that these are still Schedule 1 substances from a federal perspective. Even if you’re in a city like Denver that has decriminalized, it’s still illegal. Decriminalization does not mean it’s legal. It just means it’s going to be the lowest priority for that particular city and they’re probably not going to enforce it. [It’s] still illegal from a state perspective and still illegal even from a federal perspective. Even in Oregon — that has Measure 109 that legalized magic mushrooms — still federally illegal, similar to cannabis. So, very important for investors. If you’re an investor and you don’t at least have an attorney on retainer or someone you could call to kind of explain this to you, I’d recommend just staying out of this space entirely. Because it is relatively complex and there’s a lot of people making claims that just aren’t true.

What’s going to happen in this sector a year from now? What’s it going to look like?

My expectation is that MDMA — which is in Phase 3 clinical trials — I think that will probably be FDA approved and commercialized by the end of 2023. So not a year from now, not 2022. Hopefully, by 2022, it’s kind of gearing up for that. 

I think… the Phase 2 clinical trials for psilocybin, I think those compounds — and there’s two of those, one for major depressive disorder [and] another for treatment-resistant depression — I think those will be getting FDA approved and commercialized sometime after that. Maybe 2024, 2025. And then we’re gonna see a whole slew of compounds after that. 

And when MDMA gets FDA approved in probably around 2023, towards the end of it, you’re going to see — I believe — thousands if not tens of thousands essentially psychedelic centers or clinics that will need to be rolled out to administer these compounds. 

If you think about it, MDMA is being approved for PTSD. And the doctors I’ve talked to, when you talk about the market for PTSD, there’s all sorts of numbers. But I think those numbers are actually underestimated. Because a lot of doctors I’ve talked to have said, “If you’ve lived through this pandemic, you most likely have some sort of PTSD.” 

So the total available market — the TAM — for MDMA psychedelic-assisted therapy for PTSD could potentially be almost this entire planet… I think there’s going to be a lot of people that are very interested in pursuing this type of treatment for PTSD and potentially off-label use as well. So, I think in year from now that’s what [we’re seeing].

And then on the decrim side, you’re going to see more cities decriminalizing. You’ll probably see California — they’ve had a couple bills. I think liberal states like California — we’ve already seen Oregon — will probably start to make a lot more progress on their legalization bills. Here in Florida, we’ve actually just filed a research bill similar to the Texas bill [HB 1802]. So several states aren’t going the decrim or legalization route, but they’re basically putting out bills that require their states to start doing some research and collect some data on the efficacy and the safety of these compounds. And I think you’re going to see a lot more of that. You’re going to a see a lot more research and you’re going to see these compounds continue to come mainstream. And you’re going to see way more mainstream biotech investors starting to get into the psychedelic space and more of the institutional investors starting to invest as well.

What do you say to skeptics who might raise their eyebrows at the thought of taking a psychedelic? 

It’s easy for me to talk to the skeptics because I was actually one of those skeptics probably 24 months ago. I had actually never taken a psychedelic compound, 36 years old. I didn’t take in anything until about 24 months ago when some of the doctors I was working with in the cannabis space started coming to me and telling me and sending me research. And you know, I tell [the skeptics] go read the research, right? Because… look I’m an attorney, I’m a CPA, I’m a man of data and science. I’m not big on anecdotal stuff. You tell me a story, I don’t [really] react. Some people react great to stories, I’m really not a story guy. I like to read data and science. 

So take the time to learn about it. Read what’s going on right now. And you will understand that these compounds have incredible safety profiles with really good efficacy. 

And then look — if you’re going to invest in an ice cream company, you’re going to want to taste the ice cream. So, I’m not advocating any sort of illegal use of psychedelics. But I will tell you, I personally tried them after reading some of the research… My first experience was actually a ketamine treatment in my doctor’s office. The doctor is actually the co-founder of my nonprofit. And my entire perspective changed on what these psychedelic compounds are. I thought they turned your brain into mush. Quite the opposite. These are mind-expanding. You’re actually opening up neural pathways and building dendrites and you feel parts of your brain talking to one another that don’t normally talk to each other. 

So go out there, do your research, legally try these compounds potentially. You can also try these compounds at retreats in other countries legally. And I feel quite confident that if you do those two things — you spend the time learning the research and you legally experience these compounds yourself — I believe very strongly that your entire perspective on these compounds will change. As did mine.

Your comments and feedback are always welcome. Let’s continue the discussion. Email me at

Disclosure: On the date of publication, Joanna Makris did not have (either directly or indirectly) any positions in the securities mentioned in this article.

Joanna Makris is a Market Analyst at A strategic thinker and fundamental public equity investor, Joanna leverages over 20 years of experience on Wall Street covering various segments of the Technology, Media, and Telecom sectors at several global investment banks, including Mizuho Securities and Canaccord Genuity.

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