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FDA Greenlight Sets the Stage for Upside With Mind Medicine

Based in New York, Mind Medicine (NASDAQ:MNMD), sometimes informally known as MindMed, is a different kind of healthcare company. Before you consider buying MNMD stock, you’ll definitely want to know what you’re getting into.

Dried psilocybe cubensis psilocybin magic mushrooms inside and around a plastic prescription medicine bottle with no lid isolated on white background, Mind Medicine (MNMD) is in the psychedelic medicine business
Source: Daniel Patrick Martin / Shutterstock.com

After all, not everyone will be on board with psychedelic medicine. The idea of dosing people with LSD or mushrooms is controversial. And there are legal barriers which still need to be overcome in the U.S.

However, those barriers might come down in the 2020s. For instance, Oregon actually legalized the use of psilocybin (psychedelic mushrooms) in a therapeutic, supervised setting. This, and other key events, could clear the runway for the national decriminalization of psychedelic medicine.

Mind Medicine is on the forefront of this movement, and there may be a ground-floor investment opportunity here. Moreover, a recent regulatory win for Mind Medicine should provide grist for the mill as the psychedelic-medicine-decriminalization movement finally finds its footing.

A Closer Look at MNMD Stock

Do you happen to have a dollar and change in your account? If so, then you can invest in Mind Medicine as the share price was barely above $1 in early February.

You’ll have to deal with a fair measure of volatility, however. Amazingly, the 52-week range of MNMD stock is as low as 79 cents, and as high as $5.77.

At one point in 2019, the Mind Medicine share price was actually one cent. We’re talking about a literal penny stock — obviously, the sentiment surrounding MindMed was quite low in 2019.

Wall Street seems to have difficulty deciding whether it likes MNMD stock or not. Therefore, it’s not recommended to take a large position in this stock, as it’s prone to bouts of volatility.

A small position in Mind Medicine could be appropriate, though. Just be aware that the stock could become a multibagger, or a permanent resident of Penny Stock Land.

An Exciting Milestone

In the healthcare field, patent protection is absolutely essential. Thankfully, MindMed has a robust and extensive patent portfolio, including at least 10 patent applications covering LSD and at least three covering 18-MC.

What’s 18-MC? It’s a non-hallucinogenic, ibogaine-derived proposed treatment for opioid-use disorder. This just goes to show that Mind Medicine is committed to combating illicit drug use, not supporting it like the skeptics might assume.

In a recent press release, MindMed revealed that it has successfully completed its Phase 1 clinical trial for 18-MC. The results haven’t been announced yet, but the completion of Phase 1 should allow Mind Medicine to move on to a Phase 2a study of 18-MC in individuals undergoing opioid withdrawal.

“This is an exciting milestone, and we look forward to announcing the results of our Phase 1 study in the coming months,” Mind Medicine CEO Robert Barrow stated in the press release.

Building on the Momentum

Another crucial objective of MindMed is to help people who suffer from anxiety. The company clearly believes that psychedelic medicine could offer treatments where traditional approaches have fallen short.

In this vein, there’s potentially great news for patients and for Mind Medicine’s stakeholders as the company just announced a significant regulatory clearance.

Reportedly, the Food and Drug Administration (FDA) has cleared Mind Medicine’s Investigational New Drug (IND) application, allowing the company to proceed with its Phase 2b dose-optimization trial of MM-120 for the treatment of generalized anxiety disorder.

This means that a previous clinical hold on the IND has now been lifted. So, MindMed can finally move forward in advancing MM-120, a pharmacologically optimized form of LSD, as a potential anxiety-disorder treatment.

In light of this regulatory win for Mind Medicine, Barrow asserted that his company looks forward to “building on this momentum and advancing this trial as quickly and efficiently as possible.”

The Bottom Line on MNMD Stock

While these developments in the field of alternative medicine are exciting, MNMD stock isn’t appropriate for every investor.

The stock is volatile, and there’s no guarantee that regulators will continue to approve Mind Medicine’s clinical trials.

Nevertheless, a small stake in MindMed should be fine for risk-tolerant traders. Each small step toward decriminalization — and toward healing outcomes for patients — is really a victory for everyone involved, investors included.

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On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

David Moadel has provided compelling content — and crossed the occasional line — on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

Article printed from InvestorPlace Media, https://investorplace.com/2022/02/mnmd-stock-is-ready-for-an-upside-thanks-to-fda-greenlight/.

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