Psychedelics Are a Billion-Dollar Business, and No One Can Agree Who Should Control It

Bronner alleged that George Goldsmith, CEO and co-founder of mental health company Compass Pathways, had been reaching out to researchers at Oregon Health & Science University (OHSU) “in an attempt to drum up concern and mobilize opposition to implementing 109 in Oregon." (Oregon Measure 109 passed in November 2020 and outlines a path to legalizing psilocybin services in Oregon by 2023.) 

This was the latest in a series of concerns voiced by various actors that Compass Pathways is attempting to exert singular control over psilocybin-assisted therapy. In 2018, Olivia Goldhill wrote in Quartz that the company had left consultants and donors feeling dismayed when it transitioned from a nonprofit to a for-profit. Since then, there have been investigations into its patents on synthetic psilocybin and questions raised about the implications of its other patent applications, which include claims on many aspects and applications of psilocybin-assisted therapy.

Bronner's statement on Goldsmith’s purported interference in Oregon highlighted what will likely be another growing tension in the mainstreaming of psychedelics more generally, outside of debates on intellectual property and ethical business models: whether psychedelics will be accessed through a medical model via Food and Drug Administration approval, or through legal and regulated access through state (or federal) laws, like the one in Oregon.  

Many states are passing or considering psychedelic decriminalization or legalization. Simultaneously, FDA-approved psychedelic-assisted therapy is within reach—as close as around two years for psilocybin and MDMA. How these two paths will intersect, interact, or interfere with each other is an open question, but proponents of both worry that one might somehow harm, or even preclude the existence of, the other. 

Psychedelics researchers and advocates have made great strides in regaining credibility for the drugs as subjects of research, potential treatments for a variety of conditions, and even a shrewd investment. Psychedelic companies, along with their intellectual property, are burgeoning into a billion-dollar industry. Some in the psychedelic community worry that decriminalization or state-regulated legal access to the compounds will either get left behind and forgotten or be actively prevented by those wanting to protect the for-profit industry. 

Until now, what exactly Goldsmith was emailing to researchers in Oregon was unknown outside of what was outlined in Bronner's post. Through a Public Records Law request, Motherboard obtained an email that Goldsmith sent to a professor of psychiatry at OHSU on November 19, 2020. In it, Goldsmith summarized what Compass Pathways does and noted, “We are also the largest funder of psilocybin preclinical and clinical research.” 

He emphasized that psilocybin therapy would be best developed in the medical model. “While we agree that there is a need for innovation in mental health care, we firmly believe that this should be developed along existing regulatory standards with FDA oversight,” he wrote. “Clearly, a majority of Oregon voters think differently.”

“Monopolistic behavior that attempts to block other entities from bringing medicines to market, or even worse, shut down Oregon’s Measure 109 model and attempt to lock up psychedelic therapy inside the FDA medical pharma model for narrow qualifying diagnoses only, is harmful to the healing we as a movement want to bring to the world,” Bronner wrote.

Goldsmith told Motherboard that hindering 109 was “not our intention ever, to be very clear." “What we saw in Oregon was simply—I said, 'Well, this is a really interesting experiment.' That's what Oregon is," Goldsmith said. "And being somebody who's trained and has a worldview like I do, when I hear the word experiment, I think about data. And so I reached out to the head of psychiatry department at OHSU and said, 'I'd love to talk.' And that was the content. It wasn't about derailing."

Goldsmith said the email was not intended as an interference in Oregon. “I just wanted to have a conversation. But I guess that’s not allowed.” 

That's a pretty significant difference in interpretation of both the content and intent of one email, an example in miniature of the debate over access to psychedelics in the same way the many complaints against and defenses of Compass Pathways mirror larger issues. Is the opinion that psilocybin (and other psychedelic treatments in the future) should be kept confined to the medical system about the safety and protection of vulnerable patients, like those with treatment-resistant depression or PTSD? Or is keeping psychedelics in the medical model about forcing people to access psilocybin through a specific company’s products and services? These are questions on which people have staked out positions while seemingly ignoring the common ground between them.

The dynamics of the debate are plain enough. Goldsmith is not alone; other notable figures at for-profit psychedelic companies have publicly said that the medical model is the appropriate avenue for psychedelic-assisted therapy for mental illness. This has led community psychedelic platforms to respond in kind, saying that clinical trials and the medical model are latecomers to psychedelic knowledge, trumped by indigenous, underground, and recreational use—and are not the best way forward. 

Both of these positions are extreme, though. There isn't any reason that medical and legal access necessitate a "pick or choose" situation. They can, technically, coexist to create an array of psychedelic services, available to a wide spectrum of people. This will require good faith behavior on all sides: from people accepting that others will access psychedelics in ways that may not resonate with them (like in a doctor's office), to companies staking claim in a new industry accepting that their profit margins might be smaller when there's a diversity of places to take psychedelics.

There are legitimate reasons to want certain groups of people to have as much as support and safety as possible if they want to try psychedelic-assisted therapy. This could mean directing them to the medical model outright. But there should be accountability and ethics built into whatever models come into existence—medical or legal. 

The medical and legal models will share many important considerations concerning safety, ethics, and training of practitioners. They will both need to grapple with accountability and consent, and be wary of healers—medical professionals or otherwise—who veer into guru territory and make false promises and cross boundaries. Both models will need to figure out how each individual will get the support they need—before, during, and after an experience— depending on what exact issue they are seeking psychedelics for. The more minds and bodies we have thinking about these issues honestly and critically, the better. 

(The unspoken irony here is that Angermayer had a life-changing psychedelic experience in a country with legal, regulated psychedelic access, yet he now insists on the medical route being the ideal option. Lars Wilde, co-founder of Compass, has referenced a similar legal psilocybin experience.)

The white paper Goldsmith attached to the email to the OHSU psychiatrist contained several mentions of the medicalization-versus-legalization issue. One of the sections is titled "Ensure that psilocybin therapy follows the evidence-based, medical route to patients, not the legalization path," with elaboration that, “There is an increasingly vocal campaign to introduce legalized psilocybin therapy through licensed facilities in the U.S. Legalization of psilocybin mushrooms in this way carries a high level of risk and would not meet the needs of the majority of patients suffering with TRD.” 

On its website, Compass also writes that to make sure psilocybin therapy is safe and effective in patients, "psilocybin therapy needs to be approved by medical regulators, not legislators." (The emphasis is in the original.) Tom Insel, former director of the U.S. National Institute of Mental Health and advisor to Compass Pathways, recently told Newsweek that he too was concerned about medical research being "overtaken by other events," like the "active movement to decriminalize psilocybin." "He worries what might happen if they become widespread outside the clinic," journalist Adam Piore wrote.

Regarding the white paper, Goldsmith said when reached for comment that the paper was referring to "well-defined, vulnerable patients who have very few care options." He further explained, "Our white paper focused on that population, and we expressed our concern that there is not enough evidence for broad public access at this point.".

But when these sentiments are combined with the alarm around the number of psychedelics patent filings in the past year, it paints the picture of a future in which psychedelics will be accessible only through a prescription and a doctor—which is not what many in the community want.

“People are worried that if psychedelics are medicalized, they'll fall into this category where their medical use will be permitted, but not if they're used outside of medicine, and that they will not be decriminalized,” said Ismail Ali, the policy and advocacy counsel at the Multidisciplinary Association for Psychedelic Studies (MAPS). “I don't think it's an irrational fear.”

In an interview with Motherboard from June, Goldsmith said that he and Compass co-founder Ekaterina Malievskaia were not “representing the medical industrial complex” but that what they have focused on from the very beginning is how to bring psychedelic therapy to a “specific group of people in a specific way"—namely, people with treatment-resistant depression who are treated by mental health professionals with their formulation of synthetic psilocybin.

“That doesn't mean that there aren’t other ways,” Goldsmith said. “It just means that what we're doing for our mission is what we're doing. It's not that it's our way or the highway.”

Goldsmith said that in his view, regulation exists to ensure that these vulnerable populations aren't taken advantage of with claims that can't be backed up by research. “They often view it as a last resort,” Malievskaia said. “And if this fails, then there's nothing else left. And so we need to be very careful how these patients are supported. We pay particular attention to how patients are prepared, how we test for safety, how we assess potential disappointment if there is a low-intensity dose or if there is no effect.” Compass' randomized controlled phase IIb study is nearly completed, and it will soon begin phase III. Alongside the nonprofit Usona Institute, they are the closest to having the data needed to apply for FDA approval for psilocybin-assisted therapy.  

Malievskaia also said that in order for patients to get reimbursement through public or private health insurance, psychedelic therapy will have to go through FDA approval and enter the medical framework. This is a magnanimous goal. But as Motherboard has noted before, FDA approval doesn't guarantee insurance coverage—especially in the United States, where insurers are notoriously bad at covering psychotherapy in-network.

I asked Goldsmith, “It would be comforting for people to hear that Compass is not against legalization. Is that accurate?”

Goldsmith said, “It’s accurate. We are very articulate, I think, about the risks of legalization. But it's going to happen. I'm a big, big fan of some key principles in life. One of them is don't argue with reality. And I think this is the direction of travel. It's going to happen. I hope it happens. And fewer people are harmed than more. But there will be casualties, there are casualties everywhere. And we just take that risk.”

In response to a request for comment just before publication, Goldsmith confirmed what he told Motherboard in June. "As I’ve said before, we are not trying to stop legalisation," he said. "Voters have spoken in Oregon. I stand by my view that even in this legalisation setting, evidence matters for public safety. I think more would be better than less. That was why I reached out to Dr. Keepers. I wanted to talk with him to see what research could be done to help create this evidence base." 

He also said it's likely that both models of access will coexist. "I think both legalisation and medicalisation have a responsibility to minimise risk through evidence and evidence-based therapy approaches," Goldsmith said. "And that there needs to be some way to ensure accurate and timely feedback on adverse events to ensure transparency. Unfortunately, they will happen in both settings. So, that is the basis of my comment about how we all minimize possible casualties. " 

Mason Marks, the project lead of the Project on Psychedelics Law and Regulation (POPLAR), said that THC, the active compound in cannabis, is another. It’s an ingredient in medical products, and non-FDA-approved products sold in stores with state laws regulating medical and adult cannabis use.

Now, companies that have patents on psilocybin-related inventions could, in theory, file infringement claims against people who are providing psilocybin services in states that allow for regulated access. But despite the incredible publicity around psychedelic patents being filed, Marks said he has no reason to believe they’re being filed any faster than in other fields. “Though it does seem as though they are appearing faster than they were a year or two ago,” he added. 

It is common for companies to blanket a field with patents. There are companies that have hundreds of patents on a single device or medical treatment, like AbbVie, which obtained over 100 patents on its product Humira, an ​​immunosuppressive drug. It will be important to keep an eye on the volume of psychedelic patents, and what they claim ownership over, to know if they could infringe on state-regulated access in any way. 

“It's difficult to say for sure, but I would think that as the number of patents granted increases, and the number of stakeholders seeking patent protection rises, the higher the odds that infringement suits will be filed against companies and practitioners in state- and federally-regulated areas of the emerging field," Marks said. 

One important legal difference will be in scheduling. The FDA approval process is different from the controlled-substance scheduling process, Marks said. In states like Oregon where psilocybin becomes regulated, it could be rescheduled on the state level but remain a Schedule I controlled substance federally until that changes via Congress or the DEA. 

If psilocybin-assisted therapy became FDA-approved, it would likely only be the approved formulation and methods of administration that would be rescheduled. Non-medical, non-FDA approved psilocybin would probably remain in Schedule I. 

Still, Marks said he sees no reason why state regulation of psilocybin services cannot exist alongside FDA approved medical therapies that include psilocybin. “They serve different purposes and can coexist harmoniously," he said. "Some stakeholders do not want them to coexist. But a diversity of approaches to psilocybin regulation and utilization is a good thing.”

Distrust and apprehension has led to some backlash, though, toward the medical model overall. In May, Alexander Beiner, the co-founder of Rebel Wisdom, wrote an article in Chacruna posing the question, “Are Clinical Trials the Only Legitimate Path to Accessing Psilocybin?” 

“We’re in the middle of a psychedelic turf war,” he wrote. “With psychedelic medicine on the cusp of going mainstream, an increasing number of players are vying for narrative control.”

Beiner was responding in part to a paper from King's College London psychedelics researcher James Rucker, who wrote that it was premature and unethical for psychedelic retreats to promise therapeutic outcomes to their visitors. “To determine whether a drug should become a licensed medicine, an objective process of scientific enquiry is required,” wrote Rucker and his co-author Allan Young. “This usually consists of a set of gold-standard clinical trials, defined by international agreement. In contrast to the history of psilocybin use, clinical trials, in their modern and robust forms, have taken place only for the past 50 years or so.”

Beiner wrote that while he agreed it wasn't right to use early data to market a psychedelic retreat, he took issue with their claim that clinical trials were the best way to usher psilocybin into the world. “Psilocybin is not a new drug," Beiner wrote. "It is a pre-existing molecule with a rich history of Indigenous use, particularly among the Mazatec, and an important history of underground and countercultural use as a spiritual sacrament or therapeutic tool."

Bia Labate, an anthropologist and executive director of Chacruna, has written similarly that “Alcohol and tobacco did not have to go through [clinical trials]. Statistically-sound clinical trials were introduced in the 1940s to ensure the safety and efficacy of new drugs and treatments. This is, of course, not the case with psilocybin or ayahuasca. Epidemiology, or the collective human experience of consumers of these substances, simply trumps clinical trials.” Beiner wrote that psychiatrists were “arguing that their profession should gatekeep therapeutic approaches using a molecule with thousands of years of existing human use.”

Beiner ended his essay by saying, “We do not have to choose between clinics and churches; we can have both. But we won’t get there by trying to defend our own turf.” But tearing down clinical trials which try to assess the safety and efficacy for specific patient groups only furthers a turf war. 

Clinical trials, while admittedly imperfect, are used to test whether a substance has a benefit for a specific group of people, and what dose is safe and efficacious if so. Society has an ethical obligation to check to the best of its ability that a drug is likely to have benefit for a patient group, which is especially important when that group is a vulnerable one, like those with mental illness. No one is using alcohol and tobacco therapeutically; that's why we don't need clinical trials for those substances.

Matthew Johnson, the associate director of the Johns Hopkins Center on Psychedelic and Consciousness Research, said that most psychedelic researchers actually don’t fall into the camp of wanting to stop recreational use, and most aren’t against measures like decriminalization. “Generally, the criminalization of drugs is just a horrific idea,” Johnson said. “We have lots of public health data to support that. I don’t think my opinion on that is radical at all.” 

But even if psychedelics had never been made illegal in the 1960s, we would need to develop them through medical psychotherapeutic models if we wanted to use them as medicine in some contexts, said Johnson. “You still need to work out their parameters and know how to use them effectively,” he said. 

Ali thinks that clinical trials are important for policy change, but that one way to address concerns like Beiner and Labate's is to incorporate other kinds of knowledge, like Indigenous wisdom, and take them as seriously as we do RCTs—but not to say that clinical trials aren't needed. “I think to say that we shouldn't do clinical trials or shouldn't have medical access is very naive,” Ali said. “This idea that we should take one of them out to accommodate the other misses a really big point and potential for actually creating broad access."

Ben Sessa, an addiction psychiatrist and chief medical officer at AWAKN Life Science, has a more practical take: “The question of why you need clinical trials to get DMT licensed is not a very interesting question, because the simple answer is because you need clinical trials to get any medicine licensed,” he said. “As far as the FDA is concerned, LSD is no different from penicillin. It's just a drug. It has to go through phase studies to show efficacy. You have to jump through these hoops. If you collect all that data and you demonstrate safety and efficacy, it will be licensed. But it won't just because it's magical and spiritual.”

One of the other arguments in Rucker and Young's paper was that if psilocybin is offered outside of a medical context, and something goes wrong, it could undermine the credibility of the drug, and hamper researchers’ attempts at making it a legitimate medicine. 

This is a semi-legitimate concern. As journalist Michael Pollan wrote in 2019, “The history of psychedelics has been marked by periods of both irrational exuberance and equally irrational stigmatization.” He cautioned that ballot initiatives “may not be the smartest way to get there. We still have a lot to learn about the immense power and potential risk of these molecules, not to mention the consequences of unrestricted use. It would be a shame if the public is pushed to make premature decisions about psychedelics before the researchers have completed their work.”

But legalization can also do the reverse. Ali said that the medical model is often the way that substances are introduced to the mainstream, and could lead to federal de-scheduling. “It’s absolutely true that if people were starting with the conversations around decriminalization or even fully legal regulated access, I don't think there would be the momentum that there is today,” he said. 

“Some parts of the psychedelic community are saying, ‘It’s going to become exclusive,’” Sessa said. “That’s nuts. It's the current situation that's exclusive. Psychedelics are used by a fairly small section of people—mostly white, middle-class trustafarians who can afford to fly off to Peru and have ayahuasca from their shaman. The majority of people don't use these drugs because they're illegal and they're banned. By medicalizing them or corporatizing them or whatever you want to call it, we are increasing accessibility.”

What Oregon Measure 109 outlines is legal access to "psilocybin services," which may or may not include therapy. Because of this, it’s the first example where a variety of different uses for psilocybin will try to exist in the same place, both medical and nonmedical, and the system being set up will attempt to triage people to the right level of care—a model that could be emulated on a larger scale if it works. In our Western culture, there are many people who will feel more comfortable seeking out a doctor in a clinic, a person with a medical degree. They deserve the right to do so just as much as a person who wants to seek out a shamanistic or peer-supported experience instead. Oregon’s Psilocybin Advisory Board has been reviewing evidence for the safety and efficacy of psilocybin from scientific, historical, and Indigenous sources. It published its first report in July. 

“There is a tension between the idea of medical psychiatrists as the gatekeepers, and on the other extreme, that psilocybin should just be freely available,” said Atheir Abbas, a neuroscientist at OHSU who is on the Psilocybin Advisory Board but was sharing his own opinions only. “The Oregon model described in the measure is, I think, an attempt to integrate all these views.”

In Oregon, people will be able to apply for licenses to offer psilocybin services, but the bill doesn’t specify that a person will have to be an MD or even a psychologist, said Abbas. In practice, this means that there will be a lot of autonomy from individuals in the kinds of services and expertise they want to legally access. There will also be some form of systematic method built into the system whereby people with specialized and complex histories will be directed to those with the proficiency to care for them, alongside a baseline level of accountability for all. 

Tom Eckert, the co-founder of the Oregon Psilocybin Society (OPS) and one of the chief petitioners Measure 109, said that’s one of the most important questions they’re working on. “What’s the best way to match providers and facilitators with clients in such a way that their needs are met and the safe spaces are created for a variety of different potential presentations?" he said. "That's a really important question, and it's not a single solution.”

Relatedly, figuring out how the licensing and training will take place, and what the training will contain, is one of the important pieces of the puzzle that the board will be hashing out over the next two years. 

Sessa doesn’t think that just anyone who loves psychedelics can step into that role. “I get a lot of people writing to me saying, ‘Ben, I want to be a psychedelic therapist.’ And I say, ‘Why?’ And they say, ‘I love taking LSD.’ Well, that's not really why you should want to be a psychotherapist. You should want to be a part of this because you love working with people with depression, people with PTSD, because you've spent years training as a doctor or nurse or a clinical psychologist or psychiatrist or counselor or social worker. You understand consent and confidentiality. You understand the neurobiology. You understand all the legal aspects of it. You understand the patient clinician relationship. You are supervised by a regulatory body. Just enjoying psychedelics doesn't turn you into a clinician.”

Ali said that he thinks that the more sensitive, unstable, or complex a person’s diagnosis is, the more likely it is that they will need specialized care. The more likely someone is to have an adverse event, the better it is there are trained and specialized people present who have accountability.

“Conversely, I think a healthy, normal person—and I don't love the term normal here—but someone who may be average, does not have a diagnosis, is otherwise stable in various ways, they may not need the same kind of highly specialized care,” Ali said. If this kind of triage can be achieved, it could end up bolstering medical access, and ensuring that those people who might need extra support of the medical infrastructure find their way there.  

Sessa said that he foresees a future of a variety of access points, as long as people can accept that all these points won't interfere with each other. “I can see psychedelics being available in nonclinical populations for personal growth and development and also for fun and festivals," he said. "And I can see clinics providing medical protocols managed by clinical teams for specific diagnoses. And I think people will go on to do both.” 

In Oregon, Eckert said doesn’t feel a division between the medical model and legal access. “I don't participate in divisive language on any of this, because my vision has always been to see a unified platform that is nuanced, that can have flexibility within it to meet a variety of means,” Eckert said. “I'm looking at Oregon as a potential platform that addresses concerns ranging from preventive to wellness to therapeutic to medical.”

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