Pharmaceuticalization of Psychedelics: Mushroom Cap-italism

I love the phrase – pharmaceuticalization of psychedelics – but can’t say that I coined it.  Dr. Tehseen Noorani (2020) coined the phrase “psychedelic pharmaceuticalization” to describe the result of psychedelic medicines undergoing “medicalization” in order for psychedelic-assisted therapy to be approved within the context of Western medicine.  With the pharmaceutical industry and Western medical culture marked by competition and profit-driven enterprise, psychedelic medicines have already become a tool of for-profit corporate enterprise. 

Objective of post:

This discussion traces how one company, Compass Pathways, has attempted to make psilocybin a very profitable endeavor, illustrating just a sliver of what happens when mushrooms go corporate - most notably - the attempt to patent set and setting (playing gentle music while people are high for example).  

In 2018, UK biotech company, Compass Pathways filed for a psilocybin patent (as opposed to open-data) and in 2020, announced an initial public offering (IPO) of 6.7 million shares on the Nasdaq Market to raise $101 million.  Compass Pathways has developed a crystalline formulation of psilocybin, Comp360, with recent results from part A of phase 3 trials with patients who have treatment-resistant depression.  Depending on the results of the trials, Comp360 may become a major competitor of Johnson & Johnson’s Spravato, a Ketamine-derived pharmaceutical (Staines, 2020).  A statement by Ekaterina Malievskaia M.D., M.Sc., chief medical officer until 2023 and cofounder of Compass Pathways, was published in the Winter of 2018 by MAPS to note the following: Compass chose to change from a non-profit to a for-profit company so that the organization could spend the needed $130 million on drug development and still create solutions that were “affordable, scalable, and sustainable.” Malievskaia went on to further describe their vision and motivation beyond their decision to use a patent:

Our patents do not preclude others from creating a range of different solutions for the synthesis and formulation of psilocybin; nor do they preclude the use of naturally occurring mushrooms, extracts, or any other products created by alternative synthesis and formulation routes. Equally, our patents do not prevent other clinicians from using our product or any psilocybin-containing products in conjunction with the types of therapy or psychological support they judge to be helpful, as long as it does not jeopardize patient safety. (Manufacturing and Patenting Sectio)

In 2018, a group of external researchers asked Compass if the company would be willing to allow researchers to use a portion of the company’s 250 grams of psilocybin for research purposes. Compass agreed to share their resources under the condition that they retain rights to block any published research results which might compromise the financial interests of their company (Giffort, 2020). 

This event among others prompted the writing of the “Statement on Open Science and Open Praxis with Psilocybin, MDMA, and Similar Substances”  in order to stand up for ethics and values as psychedelics undergo medicalization, calling for a continued psychedelic science and practice that is committed to cooperation and integrity.  Over one hundred researchers, scientists, clinicians and elders were prompted to sign the Statement on Open Science given held concerns about the blocking of non-profit psychedelic research by for-profit companies.  In the Statement on Open Science, a pledge was made for continued integrity, open-data sharing, and service to the common good within the multiple disciplines working towards the beneficial use and understanding of psychedelics, entheogens, and hallucinogens.  In her statement published on MAPS, Compass cofounder, Maliekvskaia, also stated, “We believe different models of care and organizational structure can co-exist, and we embrace healthy competition through creating alternative solutions” (Our Focus: Improving Outcomes section).  This occurs on seen and unseen levels, with the psychedelic research community now composed of both closed and open approaches to science. 

Usona Institute, a nonprofit medical research organization, has maintained a commitment to Open Science by publishing six papers on the manufacturing of psilocybin-related medicines including different crystalline polymorphs of psilocybin similar to what Compass patented.  Mentioned earlier, both Usona and Compass are leading the way in research with psilocybin, with Usona having begun their phase 3 in March, 2024.  After Compass filed their initial patent in 2018, Usona Institute board member Carey Turnbull approached a team of chemists and psychiatrists for the following review:  “Compass appeared to be attempting to patent LSD-inventor Albert Hofmann’s method for producing psilocybin in a lab.  Turnbull challenged Compass’s patent claims as ‘prior art’ -- information that has already been made available to the public -- and Compass withdrew all 27 claims” (Hausfeld, 2018).  

In September of 2020, MAPS published a statement congratulating Compass on their public market offering, which resulted in a doubling of stock and $1.3 billion valuation.  One view in support of for-profit advancement of psychedelic therapy and patented medicine, understands that intellectual property (IP) and big business are crucial for generating the interest of investors.  Such investment, it is argued, is necessary for the generation of enough capital to ensure that psychedelic medicine is made available to as many people as possible (Leite, 2021).  Ensuring that people, regardless of income, have access to medicine for PTSD and depression is, of course, an understandable endeavor.  According to the World Health Organization, depression is the leading cause of disability in the 21st century (James et al. 2018).  

How much capital is needed to truly affect any significant change in Western medicine with psychedelic medicine? (I'm not including Ketamine when I ask this as Ketamine is technically a dissociative vs a classic hallucinogen).  How much capital is required for psychedelics to serve as a positive, healing force within the field of psychiatry?  The question is not if psychedelics will become a tool of for-profit corporations.  To what extent will for-profit corporations will be led by competition rather than cooperation, and to what extent might this undermine the goal of bringing effective medicine and healing to those who might benefit regardless of pay? 

In a foreshadowing if not simply honest statement, Malievskaia of Compass Pathways stated in 2018:

The creation of reimbursable models of care then becomes essential if we are to ensure that everyone who would benefit from psilocybin therapy can access it regardless of their ability to pay. It might be that “a thousand flowers will bloom” – and eventually the best models will prevail simply through quality and price competition, or that treatments will be rolled out in a more regulated way. This will require constant feedback and frequent course correction, as we continue to learn from our collective experience (Malievskaia, 2018, Our Focus section).

In 2021, Compass filed a patent application for IP rights with 162 clauses detailing treatment of depression including set and setting such as muted colors, soft furniture, mood lighting, and high-resolution sound system (Leite, 2021).  These methods of set and setting were established decades ago.  Tim Ferris, a heavy investor in psychedelic research and investor to many successful start-up companies, publicly challenged the decisions of Compass.  Ferris stated:

Compass and other for-profit companies have the potential to do a ton of good in the world. I also think that the nature and incentives of capitalism can breed strategies that are very bad for innovation, and we need individuals, groups, and third-party organizations to watch for them and mitigate them… None of this is Compass- or ATAI-specific. It applies to every startup and company in the space...

In addition to Ferris and Doblin, David Bronner who is on the Board of Directors for MAPS also spoke out against Compass in 2021.  Bronner challenged Compass’s opposition to Measure 109 in Oregon which would allow psychedelic therapy in Oregon.  Bronner described Compass wanting to keep psychedelic therapy within the “FDA medical pharma frame only”.   According to Bronner, this opposition is an effort to dominate the field of psychedelic therapy.

            The events and vocalized opposition against Compass in 2021 help to situate the medicalization of psychedelics within the most recent political, economic, and cultural developments.  While the efforts of for-profit companies like Compass and nonprofit organizations like MAPS have played extremely significant roles in the legalization of psychedelic therapy, a new phase within the field of psychedelic medicine is taking shape.  Ferris states:

“For-profit ventures have a critical role to play in the expansion of psychedelic medicine, but for-profit ventures don’t get a free pass. They can also cause harm, and they often do. There will be compelling temptations to make unethical decisions, pursue unfair anti-competitive practices… There are bad actors and mercenaries in every industry. But here’s the part that people forget: even if the founders of a company rival Mother Theresa in their moral character and strength, that isn’t enough.  Leadership changes, incentives change, power dynamics change, and all situations change…That’s why both internal guardrails and external watchdogs are important” (Ferris, 2021, Do You Disagree).

Similar to pharmaceutical industry practices, the psychedelic industry needs industry leaders as well as public advocates to closely monitor and question decisions.  This careful assessment can hopefully be shaped and led by those who have given decades of heartfelt research, underground guidance, financial and institutional support, serving to establish the roots of what may become a part of the mainstream psychiatric industry.