From Psilocybin Nasal Sprays to Transdermal Ayahuasca, Inside the New Wave of Psychedelics

It’s harder than one might think to create a novel psychedelic drug. On his own, legendary chemist Alexander “Sasha” Shulgin discovered, synthesized, and analyzed more than 230 psychoactive compounds, including MDMA (which he synthesized and popularized decades after a German pharmaceutical company formulated it in 1912), as well as compounds of the 2C family, such as 2C-B (which is often compared to a hybrid of MDMA and LSD). For decades, underground chemists and devout psychonauts have also tinkered with mind-bending substances and used themselves as guinea pigs to chronicle the bizarre, divine, and sometimes outright terrifying on message boards like Reddit and Shroomery, or Erowid, the digital encyclopedia of psychedelic reports. And for even longer, perhaps since the beginning of humanity, indigenous communities have experimented with local botanicals to create hallucinogenic, and often sacred, medicines.

Today, chemists around the globe are continuing the work of Shulgin and others, but, now, the stakes are a lot higher. Behind them, they’ve got government approval, hundreds of millions of dollars in capital, and a disheartened public, desperate for novel solutions to depression, anxiety, trauma, addiction, and other mental health conditions which have practically become the new norm. There’s a fundamental difference this time, though, in the aim of this exploration: Psychedelic drug development companies, of which there are now at least a dozen and counting, are not merely playing with these compounds to see what might happen—but working to optimize them and, in most cases, patent them in order to bring them to market. This includes novel delivery systems like psychedelic nasal sprays, transdermal patches, and sublingual strips, as well as novel compounds, such as an LSD-like drug that only lasts a few hours instead of 10 to 12, a milder take-home MDMA (sometimes referred to as ecstasy), and mushrooms minus the potential for a “bad trip.” This is fueling a philosophical and spiritual debate within the psychedelic industry about whether the trip (i.e. the visions, or even the purging on ayahuasca) is integral to the medicine and, also, whether it’s ethical to patent and profit from psychedelics at all.

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Aya Biosciences, a California-based cannabinoid and psychedelic drug development company, alone is investigating more than 70 psychedelic compounds for eating disorders, pain, addiction, and a number of other conditions. Among them, they’re developing an ayahuasca-like formulation in the form of a sublingual strip, which dissolves under the tongue in three seconds, to avoid the nausea that commonly comes with the entheogenic brew. Chief science officer Del Potter says the experience is the same as ayahuasca in its traditional form except patients won’t purge (i.e. vomit) and the journey will start almost immediately, since the delivery system avoids gastric metabolism and enters the bloodstream quickly. They’re also investigating aeruginascin, a compound found in a species of psychedelic mushrooms called Inocybe aeruginascens, which chemists have called “the CBD of psychedelic mushrooms” because it might serve as a mental health treatment without the risk of a “bad trip.” Then there’s DMT and all its analogs (EPT and MALT, to name a couple); the beta-Carbolines (alkaloids which play an important role in ayahuasca); and tryptamine compounds, such as LSD analogs. This only scratches the surface.

Gilgamesh, a pharmaceutical company developing drugs based on psychedelics, is currently running three drug discovery programs: one for depression and anxiety, one for substance use disorders such as opioid use disorder, and one for a take home drug for ADHD and mood or anxiety disorders. Each of these programs is exploring about 30 psychedelic-based molecules to address these conditions, with the intention of taking one per program through the FDA-approval process.

Oh, and then there’s Tactogen, the pharmatech startup working on “the next generation of MDMA-like medicines,” with an interest in developing a milder form of MDMA that can be taken at home as opposed to with a therapist; ATAI, entrepreneur Christian Angermayer’s venture, which is developing nine compounds including a derivative of mitragynine, the active compound in Kratom; Cybin Corporation, which is synthesizing a sublingual strip of psilocybin, the psychoactive component in magic mushrooms, which will be administered to clinical trial subjects with major depressive disorder—and apparently might taste like cherry; and Mindmed, which is researching 18-mc, a synthetic derivative of ibogaine for opioid use disorder, among a number of other psychedelics. The list goes on.

Across the board, these companies point to the fact that there hasn’t been a significant class of drugs developed for mental health since SSRIs first hit the market in the late Eighties—and that these drugs, simply, fail many patients and come with side effects. Psychedelics like psilocybin and MDMA have shown incredible promise as novel solutions for depression and PTSD in rigorous, multimillion dollar clinical trials. Compass, the UKbased for-profit drug development company, will likely be first to market with psilocybin for depression and the Multidisciplinary Association for Psychedelic Studies, a leading psychedelic research nonprofit, will likely be first to market with MDMA for PTSD in the next five years. They’ve both been granted what’s called “breakthrough therapy status” by the Food and Drug Administration because these treatments have shown so much promise to treat conditions for which we currently have limited effective options.

There are also decades and, in the case of indigenous medicines, sometimes centuries, of anecdotal reports about the therapeutic and spiritual benefit of ayahuasca, iboga, san pedro, and countless other entheogenic plants and fungi. But many people who are suffering, these companies say, may never want to actually trip, because they’re afraid of a traditional psychedelic experience. This is one prominent—and controversial—case being made for creating “new and improved” psychedelics, even though there are so many psychedelics which exist already. In addition to making the psychedelic experience more tolerable, researchers say this drug development is also, simply, focused on making these drugs more effective—more targeted for particular conditions and/or less risky for patients. (Bexson Biomedical, a drug development company focused on ketamine, for example, is creating a novel subcutaneous delivery system for ketamine, because there isn’t currently an easy, effective way for patients to take low doses of ketamine at home for pain.)

Folks who have expressed concern about the for-profit drug development of psychedelics—such as the founders of North Star, a nonprofit devoted to inspiring equitable business models in the psychedelic space—say the tactics that come along with creating these drugs, such as patenting, could lead to a monopolization of psychedelic medicines by a few companies who set prices and create barriers to access for the many people who need healing. It’s widely accepted at this point in the professional psychedelic community that psychedelics will be legal, so now the conversation is largely focused on what that will look like (i.e. whether these medicines will be covered by insurance, how much they will cost, who will control the supply chain).

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Jeff Becker, chief science officer at Bexson Biomedical, says when seeking to identify a compound for a particular mental health condition, you simply start with “where you’re trying to get” and work backwards. “If you’re targeting, let’s say, pain as a symptom, basically, you have to look at what causes pain—what receptors are involved and what kinds of interactions at a neuronal level are involved—and then you work your way backwards and you say, ‘Okay, it might be really interesting if you could create a compound that blocked this receptor a little bit, blocked this one a lot, and maybe actually activated this receptor.’”

Another approach, taken by Gilgamesh, is to simply start with the drug itself. Gilgamesh has a team of chemists who know how to design drugs, but who also have dived deep into the depths of those online message boards. “They know not just the scientific literature, but they’ve read trip reports for decades,” says Jonathan Sporn, CEO of Gilgamesh. “They know this stuff extremely well.” Gilgamesh, which is also the first psychedelic drug development company to be accepted into the prestigious Silicon Valley accelerator Y Combinator, says they aren’t investing in legalizing psychedelics, but, rather, “medicines inspired by psychedelic drugs.”

Their strategy entails starting with trip reports to identify molecules of interest and, then, changing them so that, often, they’re no longer psychedelic at all. The concept is to create medicines that are easier and safer to use, as well as more therapeutically effective than existing drugs, says Sporn. They hope to create a microdosing drug, for example, with minimal side effects, which a patient could never accidentally trip on if they took too much—and could be taken at home as a safer alternative to currently available medicines for ADD and anxiety, such as amphetamines and SSRIs. A drug like this might also, suggests Sporn, be used after a psychedelic experience to maintain its therapeutic value and prevent relapse, something which, he says, is common among many patients during the first six months following a trip.

Sporn describes figuring out which drugs work for which conditions—and how drugs can be changed without diminishing efficacy—like a lock and a key. The lock is the receptor, and the key is the drug. If microdosing LSD treats depression, for example, but taking too much LSD might cause a person to trip (and that’s deemed unfavorable), they experiment to see if the LSD compound (i.e. the key) can be slightly changed so that it does not cause a person to trip but still hits the receptor (i.e. the lock) that causes the depression.

This sort of experimentation gets into philosophical questions within the field: Many deep-state psychonauts hypothesize that the journey is the medicine, that the visions and other psychedelic components of the trip are essential to how and why these compounds provide healing. They also argue that patenting psychedelics is sacrilegious—because they come from the earth and should be available to all.

Srinivas Rao, ATAI’s chief science officer, says he thinks there’s a lot of conflation between the natural product (i.e. the mushroom that comes out of the ground) and the isolated compound (i.e. psilocybin). “There’s nobody advocating, as far as I know, for patenting the actual plants. That’d be very challenging. But the isolated compounds to me, in a medical context, are a very different story,” says Rao. “I always go back to fish oil. Omega three fatty acids do, in fact, have patents on them and I know they don’t have a social overlay, but you can’t patent the tuna.”

To go even deeper than that, some, such as Potter, believe it’s unethical to patent a synthetic version of a natural compound such as psilocybin—even if it’s been slightly modified—because it comes from a fungi, long used ceremonially, which has shown healing potential in its natural form. But it’s not unethical to patent a completely novel compound, something a scientist essentially created in a laboratory, just because it’s psychedelic. The key distinction, Potter says, is whether the compound has been optimized in a way that truly adds value for the patient or has been changed merely so that it’s eligible for patent, and thus profit.

“I don’t agree with people tweaking something like psilocybin ever so slightly, I don’t think that’s a worthwhile use of resources,” says Potter. “But I do think you should be able to patent something that’s completely novel. We want to make these things better, more therapeutically targeted. That’s the goal.”

All of these researchers also point out: getting a patent just isn’t that easy. The United States Patent Office, says Becker, is very stringent in their criteria for granting patents. The drug or drug delivery system must be “completely novel,” meaning it has never been described before in the literature—even in some obscure place on the internet or in a decades-old book; “nonobvious,” meaning that it’s not something that could easily be conceived of by someone else; and have “new utility” (i.e. the novel aspect of the drug has to be useful, you can’t just dye an existing drug purple and claim it’s “novel”). Then, once a company gets granted a patent they only have 20 years on that patent, and most of that time the drug typically can’t be sold, since it’s still being researched.

“Eventually that time passes,” Becker says in defense of patents. “It’s guaranteed and it becomes generic for the rest of time, for the rest of existence and for all humans on earth, it will be generic.”

It’s not as cut and dry as there being for-profit entities who only care about profiting and nonprofit entities who care about alleviating suffering, Becker adds. In fact, he says, he thinks there are “many” companies now that are registered as for profit entities and ethical.

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Up until now, the leading psychedelic nonprofit, MAPS, has managed to raise tens of millions of dollars in donations for their drug development, but there’s a limited number of donors in the world, Becker says; most funders of drug development want a return on their investment, and patenting compounds is a way to ensure that, because it means that the company that brings a drug to market is the sole entity that can sell—and profit from—that drug for a limited period of time. The argument goes: if a company spends millions of dollars doing the research to prove that a drug is effective for a particular condition, they should be able to make that money back. Also, early-stage drug development is risky, because oftentimes after a lot of pricey research, the drug doesn’t even make it to market, thus, the investors who made that research possible should be rewarded with a return on their investment should the research succeed.

Liana Gillooly, co-founder of North Star, says she’s skeptical that many of these new psychedelic drug development companies are creating compounds simply to optimize the psychedelic experience for patients. Instead, she says, she thinks that in many cases they are motivated by profit. “A primary reason people are attempting to create analog psychedelic molecules, is because they’re aiming to have ownership over them and so my question is: ‘why?” Gillooly says. “Is it because ownership means monopoly, which can lead to setting prices and extracting the most amount of value as possible? The answer is usually something about how huge sums of money are needed to do drug development, so my next question is: Are discovering these new molecules the highest priority in the field of psychedelic research, if there already are molecules in the public domain that are exceptionally effective and interesting to study? If the aim is to maximize potential gains, is that practice something we should be doing, especially when it comes to treating mental suffering? I understand there needs to be an economic exchange so the opportunity for people to heal exists, but I’ve come to deeply question this whole model.”

Gillooly—who is also development officer at MAPS, but was not speaking on their behalf—says she’s not necessarily opposed to patenting, and even if she was, it’s a futile stance: “People already have [patented psychedelics], people are, and people are going to continue to.” Because patenting will happen regardless as investors pour more capital into the space and researchers continue to work on novel psychedelic compounds, she says it’s more “interesting” to think critically about innovative business models that ensure access to these medicines for all who are suffering. This could include companies partnering with social services and other government entities that can help facilitate access to these medicines for underserved communities, placing indigenous people on their boards, and steward ownership, a set of legal structures put in place by a company to ensure that purpose (i.e. healing) is prioritized over profits (i.e. making money from the medicines that heal).

Bennet A. Zelner, associate professor of business and public policy at the University of Maryland’s Smith School of Business, says he doesn’t doubt that there are good actors in the market—researchers and other stakeholders on the for-profit side of drug development—who care about alleviating suffering, but that our current capitalist paradigm for drug development is fundamentally flawed. “The problem is the extractive system of capitalism that we currently live in; the rivalrous behavior that this system breeds—which is linked to the deeply embedded idea of monopolization as an end goal. This is what is making many people sick in the first place,” he says. “So it seems to me to be completely counterintuitive to deliver these revolutionary treatments, that have vast potential to heal mental distress, using the same type of economic approach that is contributing to a great deal of mental distress in the first place.” Zelner points to how the pharmaceutical industry—which has generated “massive profits” for corporate shareholders while prices of medicine have soared for patients in recent decades—used the same strategies, with the same justifications about the need for capital to scale, as some of these new psychedelic drug development companies.

A study conducted by the University of Pittsburgh’s Center for Pharmaceutical Policy and Prescribing found that between 2007 and 2018 the price of 602 major drugs in the United States increased by 159 percent. That’s three times faster than inflation. “I think if we’re going to start looking for different ways to do things any place, it should be in psychedelics,” Zelner says.

These conversations feel prescient for most psychedelic stakeholders within the field: MAPS just raised $30 million in donations to get MDMA through the final stage of the FDA- approval process for post-traumatic stress disorder; and Compass, the UKbased company backed by Peter Thiel, Michael Novogratz, and others, went public in September, with a current market cap of more than $1 billion. And yet, many of these stakeholders also agree that much of the dialogue at this point is hypothetical and—maybe even preemptive, given that none of these pharmaceutical companies have actually put forth models or pricing yet that is certain to create barriers to entry for patients.

Psilocybin and MDMA will likely both be legal this decade for depression and posttraumatic stress disorder. But nearly all the drug development happening now around novel psychedelic compounds and products is preclinical, meaning that it’s still in the exploratory phase and has not been approved by the FDA to be administered to humans.

Much of it may never be. In many cases, these new psychedelic drug development companies are exploring dozens of compounds and varying delivery systems for those compounds. This has even prompted discussion among investors—both of whom are already in the psychedelic space and interested in getting into it—about whether all the psychedelic drug development companies who are going public are doing so too early, before they’ve proven their profitability.

The debate too over whether psychedelics will be equally effective, or effective at all, if the purge, the trip, the bad trip or some other fundamental aspect of the experience is changed, also remains largely hypothetical. Right now, without the data, it’s an ideological debate—but when we are able to compare these drugs in rigorous clinical trials, that debate might just dissolve. And at that point, stakeholders within the field may be prompted to have a more candid, nuanced conversation about what the point of the psychedelic renaissance really is. If it’s merely to alleviate psychological distress and a psychedelic without the trip does that, then they’ll have accomplished their goal. But if there’s a secondary—perhaps even more ambitious—mission at play, to inspire a great awakening, they may discover that they have lost an opportunity to do that.

*This article was originally published in DoubleBlind Issue 4.