10 Psychedelic Startups Investors are Flocking To (Insider Monkey)

In this article, we discuss the 10 psychedelic startups investors are flocking to. If you want to skip our detailed analysis of these startups, go directly to the 5 Psychedelic Startups Investors are Flocking To.

One of the key developments in the psychedelic industry over the past year and a half has been the stock market debut of companies like Atai Life Sciences N.V. (NASDAQ: ATAI), the German biopharma firm that aims to treat mental health disorders through psychedelics, and COMPASS Pathways plc (NASDAQ: CMPS), the United Kingdom-based pharma firm specializing in psychedelics. The former was valued at over $2.6 billion on the first day of trading earlier this month while the latter raised $146 million from an initial public offering in September 2020.

The interest in psychedelic treatments and novel therapies for treatment of mental health conditions like depression, anxiety, and resistant depression has spread all over the biopharmaceutical industry, with industry giants like AbbVie Inc. (NYSE: ABBV), Bristol-Myers Squibb Company (NYSE: BMY), and Abbott Laboratories (NYSE: ABT), who have top-selling mental health-related drugs in the market, all possibly eyeing up investments in the area that offers explosive growth potential in the coming decades.

The interest is not without cause. In addition to the blockbuster stock debut of psychedelic companies in the past few months, market experts have also been urging investors to realize the true potential of psychedelics. According to a report by Data Bridge Market Research, the global psychedelic market was valued at over $2 billion in 2019, a number expected to jump to close to $7 billion by 2027. This represents a compound annual growth rate of a scary 16% for an industry that is still very much in infancy.

Another report on the industry, by Research and Markets, contends that the value of the industry was over $4.7 billion in 2020 and will climb to over $10 billion by 2027, growing at a compound annual growth rate of 12% in the next six to seven years. There is little doubt that psychedelic research is already making giant strides in the field of mental health and will likely act as a disruptor in the health sector unless big pharma embraces the new technology. The winds of change in this regard are already blowing and big finance has been the first to fall.

With this context in mind, here is our list of the 10 psychedelic startups investors are flocking to. These were ranked keeping in mind the amount of money they have raised so far, the quality of services and products they offer, and the basic business fundamentals of each company.

Psychedelic Startups Investors are Flocking To

10. Diamond Therapeutics

Diamond Therapeutics is a pharmaceutical company that focuses on psychedelics. It is based in Toronto and placed tenth on our list of 10 psychedelic startups investors are flocking to. The Ontario Brain Institute is one of the leading investors in the company. The latest round of funding for the startup was held in January this year, raising an undisclosed amount. The company markets itself as a developer of sub-perceptual, non-hallucinogenic treatments that could treat different kinds of mental health disorders.

Investors interested in Diamond Therapeutics should also check out Seelos Therapeutics, Inc. (NASDAQ: SEEL), another pharma firm focusing on psychedelics. However, Seelos Therapeutics, Inc. (NASDAQ: SEEL) primarily concentrates on drugs for the treatment of diseases related to the central nervous system.

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