State and federal governments have played a larger role when it comes to approving illegal substances. Most notably, cannabis stocks have been in focus over the last few years, as various government bodies have given marijuana the green light. Now though, psychedelic stocks are in focus.

Companies like Compass Pathways (NASDAQ:CMPS), MindMed (NASDAQ:MNMD), ATAI Life Sciences (NASDAQ:ATAI) and others are in the spotlight as a result. Currently, ATAI Life Sciences is the largest of the three, with a $660 million market capitalization. However, Compass Pathways will likely generate the most revenue this year.

Several U.S. Senators put forth legislation that would cover psychedelic treatments in experimental therapies. Importantly, the bipartisan bill could gain traction in Congress, as Democratic Senator Cory Booker of New Jersey and Republican Senator Rand Paul of Kentucky proposed the legislation.

It also has support in the House. Representatives Earl Blumenauer (Democrat, Oregon) and Nancy Mace (Republican, South Carolina) also support the bill.

They want an amendment to the Right to Try Act in an effort to assist terminally ill patients. The Right to Try Act was signed into law in 2018 and opens the door to otherwise unapproved treatment options. According to the U.S. Food and Drug Administration (FDA), “This law is another way for patients who have been diagnosed with life-threatening diseases or conditions who have tried all approved treatment options and who are unable to participate in a clinical trial to access certain unapproved treatments.”

Will Psychedelic Stocks Benefit From This?

Booker and Rand are looking to clarify the Act, opening the door for other treatment options. They argue that it “should allow terminally ill patients to have access to Schedule I drugs for which a Phase 1 clinical trial has been completed.”

Specifically, it “would remove any obstacle presented by the Controlled Substances Act with respect to Schedule I substances when they are used by doctors and patients in accordance with the federal Right to Try law.” Controlled Schedule 1 substances include psychedelics like MDMA and psilocybin.

Does that make cannabis and psychedelic stocks a slam dunk? No, not necessarily. But it does crack open the door to an otherwise difficult industry with a lot of regulations and restrictions.

It’s not immediately clear how these types of stocks will react or perform. However, it’s certainly a step in the right direction. The fact that the bill has bipartisan support — at least so far — is certainly a positive for ​​psychedelic stocks.

On the date of publication, Bret Kenwell did not have 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.