Psychedelics research is a promising market for investment. However, since certain drugs’ legal status is yet to be determined, investors may be hesitant to pull the trigger on any specific stock. Novamind Inc. seeks to distinguish itself by providing a three-pronged approach to psychedelic therapy distribution — Research, clinics, and retreats – leaving drug development to other companies. In this way, Novamind is positioning itself to be a market leader regardless of which drugs are approved.
On July 30, 2020, Novamind acquired Cedar Psychiatry, a network of outpatient mental health clinics, and Cedar Clinical Research, a contract research organization (CRO) studying emerging treatment options in neuropsychiatry. Cedar Psychiatry has already distributed well over 4,000 ketamine treatments in Utah, its base of operations. Aside from gaining income treating patients with currently approved medication, Cedar Psychiatry’s infrastructure also provides a model for distributing other drugs as they become available to the public. This fact is crucial to Novamind’s agnostic approach to the psychedelics industry.
By focusing on Research, clinics, and retreats, Novamind avoids putting all its eggs in one basket, so to speak. Other companies will find success or failure as they develop new drugs from psychedelics, but regardless Novamind will be able to facilitate the delivery of the best medication available to patients in need.
Previously, Novamind CEO Yaron Conforti has been at the head of eight different companies, from wastewater treatment to capital investments. When the clinical trials at Hopkins and Compass Pathways grabbed his attention, he and his partners at Plaza Capital made moves to get involved. The search for investors in the private sector eventually led to the decision to go public on January 5 of this year. Although the psychedelics industry looks set to boom in the coming years, investors still consider the company risk-capital because of previously banned drugs’ uncertain legal status. Going public diminishes the risk to individual investors and opens up the possibility of entirely different players joining in.
Novamind’s third prong is organizing retreats. Patients undergoing mental stress may find that clinics are the worst place to receive care. In mental health, the setting is as important as the quality of treatment. Therefore, Novamind is investing in different companies to facilitate their hosting patients who may be otherwise unable to receive treatment anywhere but a clinic. On November 18 of 2019, Novamind made a strategic investment in the Synthesis Institute, located in the Netherlands. The institute is well-known for its successful psilocybin retreats. Additionally, Novamind has invested heavily in the Circadia Centre, a company that builds medicinal retreats in Costa Rica. Coronavirus has stopped Novamind’s foray into retreats, but plans are in place to resume as soon as it is feasible.
In an interview with www.biotuesdays.com, Conforti says, “we saw an opportunity to build a sustainable business in a market that’s going to grow very quickly, especially given the rate of treatment-resistant conditions. As an example, 30% of cases of depression are not responsive to standard treatments. This unmet need remains core to our vision: we’re working toward a new standard of mental health care.” (1) If Conforti, and the nascent therapeutic psychedelic companies, are right, then psychedelics stocks may be the fastest growing industry of the coming decade.