Investors bullish on the impact psychedelics could have in behavioral health treatment now have the opportunity to put their money where their mouth is. A new company focused on making equity investments in psychedelics-related companies just debuted, giving stakeholders an interesting case study to follow in months to come.
The company in question is Origin Therapeutics, which launched last month in Vancouver, British Columbia. The new actively managed investment issuer plans to list on Canadian Securities Exchange under the ticker ORIG, giving people access to early-stage investments in private companies in the psychedelics sector.
Studies have shown that psychedelics are effective in treating depression, PTSD and other behavioral conditions, especially for patients who haven’t had luck with other treatments or who are facing terminal illnesses. However, regulations stand in the way of the drugs being used on more a widespread basis in most localities, including the U.S.
Canada, however, is at the forefront of psychedelic wellness, with recent regulations making it easier for alternative medicine companies to develop psychedelic behavioral health treatments. Still, Origin CEO Alexander Somjen said the U.S. is the ultimate prize.
Behavioral Health Business recently connected with Somjen to discuss the impetus for Origin, the type of companies it’s looking to invest in and the role he believes psychedelic medicine has to play in the future of behavioral health treatment.
You can find BHB’s conversation with Somjen below, edited for length and clarity.
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BHB: What was the impetus for Origin and how long has the company been in the works?
Somjen: Origin has been in the works for approximately six months.
We wanted to come up with a vehicle to provide investors access to the psychedelic space, which we estimate could be potentially a $100 billion market. The vast majority of companies designed to take advantage of this market opportunity are private, and retail investors often don’t have access to the exciting privately held companies in the psychedelic space.
Of equal if not more importance, we’re all passionate about mental health. While there has been some commercial success with conventional medication designed to treat mental illness and addiction, many experts have voiced their disappointment with their efficacy.
One in five Canadians experience mental illness or addiction every year, and mental illnesses are a major cause of premature death. And globally, it’s the same story — 160 million people are affected by substance abuse, 250 million people are affected by anxiety, 200 million people are affected by PTSD and depression — so we’re looking at maybe a billion people globally who could benefit from psychedelic-based treatment options.
We wanted to be in a position to provide growth capital to companies operating in space and fulfilling that mission.
I know the ultimate plan is to become publicly traded. Where are you at in that process?
We’re still, I would say, two to three months off from listing.
And have you made any investments yet?
Yes, we have invested in four companies in the psychedelic space: two preclinical stage companies working on developing IP and pharmaceutical applications for psychedelics; one company focused on marketing, conferencing, awareness and education surrounding the psychedelics industry; and one company that’s building out psychedelic-focused wellness retreats.
In general, what sort of psychedelics-related companies do you have your eye on?
We intend to add companies to the portfolio that fit the bill of our existing investments.
We are looking at pre-clinical-stage biotech companies involved in the psychedelic space with deep bench strength in their management teams and proven track records in the pharmaceutical industry, as well as psychedelic-related companies that are outside of the deep science biotech realm and have solid business models and visibility to revenue generation and profitability.
Your company is a little bit ahead of the curve when you consider how young the psychedelics industry is. You can use them to treat behavioral conditions in Canada, but there’s not much opportunity in the U.S. yet. Is it accurate to say you’re betting on that changing one day?
Yeah, absolutely. Canada has a regulatory framework in place for psychedelics. In the US, it’s still a challenge to clear psychedelic-based pharmaceutical treatment through the FDA. I mean, even cannabis is still a big challenge in the US at a federal level.
We’re hoping we’ve targeted companies that are doing clinical research in jurisdictions that have at least a regulatory framework to allow them to operate.
Ultimately, the U.S. is the prize, but for now, we’re focused on companies that are operating in Canada and conducting clinical research in certain European jurisdictions — the U.K. and the Netherlands. We’re still a ways off from the U.S. being viable.
What role do you foresee psychedelics playing in the future of behavioral health treatment?
Psychedelics have the power to alter perception. They kind of have mind-expanding effects. Most people, I would say, consider them to be a recreational drug, but they do have a very long history of being used medicinally, especially the naturally occurring psychedelics such as psilocybin, psilocin, mescaline and ayahuasca.
Today, society is more informed than ever on mental health and how to treat mental illness, so interest in psychedelics is really at a peak for its treatment potential in that regard.
The laws prohibiting their use — and the rationale used to set up those prohibitions — are being challenged. The public in general is more open to the idea of psychedelics as a treatment option, and more and more studies are being released showing psychedelics are some of the least harmful drugs.
I think we could see a future where psychedelics are a valuable add-on or alternative to treating mental illness alongside conventional medications.
What needs to change for psychedelics to be used more on a widespread level? And how far out do you think we are from that being the case?
Simply put, we need a more lenient regulatory framework globally. We need to see psychedelics descheduled and decriminalized in important markets to give the patient access and to give biotech companies and pharmaceutical companies the ability to commercialize psychedelic treatments to make them available to the wider public.
Is there anything else you’d like to add?
With Origin, our offering is unique. A lot of people want more education on psychedelics, and investors want access to opportunities in the psychedelic space.
I think it’s going to be an exciting opportunity for us going forward.