Welcome to this week’s Trip Report by Beckley Waves.

The original title of today’s post was “Bridging the Gap” since I sense that the psychedelic field has entered the “slope of creating psychedelic infrastructure” that will bridge the gap between the increasing demand (that is currently turning to the underground) and safely, effectively and legally meeting that demand.

But then Australia went and legalized MDMA and Psilocybin…

In a watershed moment from Down Under, just announced today—starting on July 1st, MDMA and psilocybin will be rescheduled and legalized for the treatment of PTSD and Treatment Resistant Depression in Australia.

So, here are some thoughts about this significant development and the broader state of things.

Let’s dive in.

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Rescheduling Down Under

Today, the Australian Government announced that it will reschedule MDMA and Psilocybin and allow licensed physicians to prescribe them for PTSD and Treatment Resistant Depression.

I shit you not.

From today’s press release from the Australian Government:

“From 1 July this year, medicines containing the psychedelic substances psilocybin and MDMA (3,4-methylenedioxy-methamphetamine) can be prescribed by specifically authorised psychiatrists for the treatment of certain mental health conditions.
The Therapeutic Goods Administration (TGA) will permit the prescribing of MDMA for the treatment of post-traumatic stress disorder and psilocybin for treatment-resistant depression. These are the only conditions where there is currently sufficient evidence for potential benefits in certain patients.”

Incredible.

Back in September 2020, when Mind Medicine Australia, the advocacy group behind the move to reschedule MDMA and psilocybin, first began its efforts, I wrote:

“Mind Medicine’s application argues that the research to date is sufficient to show the safety and efficacy of MDMA and psilocybin, and the growing burden of the mental health crisis, citing covid and recent brush fires, is enough to circumvent the traditional route of drug development and approval.
The application to the Australian TGA points to the FDA’s designation of MDMA and Psilocybin as Breakthrough Therapy, Health Canada’s recent exemption, the progress of MAPS, Usona, and COMPASS and leans on Usona’s Expanded Access Program as a precedent for this approach:
“The FDA has approved an “Expanded Access” or “Compassionate Use” scheme using psilocybin to treat both treatment-resistant depression and major-depressive disorder in patients who have exhausted all other options. A treating physician must obtain approval from the internally created Institutional Review Board of Usona Institute (a not-for-profit organization in the US) and approval from the FDA under its Expanded Access Scheme to receive these medicines from Usona.”

In other words, the architects of the proposal proposed frameworks already established in the US, along with the rescheduling of MDMA and psilocybin to enable access in Australia.

The proposal sought to reclassify MDMA and Psilocybin from Schedule 9 to Schedule 8.

Schedule 8 substances include opioids, benzodiazepines, and other drugs prone to abuse but used in medicine and require protective protocols for their administration, whereas Schedule 9 substances are strictly prohibited.

This is unique as a federal government has broken ranks with the Controlled Substances Act harmonization schema regarding psychedelics and also the first time a national government has created a treatment without regulatory approval1.

Here is attorney Matt Zorn on the matter:

“The only thing I want to emphasize is how this happened. An applicant petitioned the government to reschedule psilocybin and MDMA in June 2022. The application presented evidence supporting moving psilocybin and MDMA to Schedule 8 — medicines that are legally available with strict legal controls. Months ago, the Australian government made an interim decision not to reschedule either. Thousands of people participated. You can read the responses. Most opposed the interim decision. Today (in Australia), the government reversed course and allowed unapproved MDMA and psilocybin to be used in treatment under severely restricted restrictions.
Which is, by the way, exactly what we are seeking to do in AIMS when we submitted a petition to reschedule psilocybin in the US back in February 2022 in a petition on behalf of AIMS written by yours truly, with bomb edits from Mr. Pennington.
This is not impossible. We talk about this kind of stuff all the time here. Start understanding the processes—and not just what people say about it. Stop believing it can’t be otherwise. Get organized. Start petitioning your government.

In other words, this sets a precedent for other countries to follow suit.

Here in the US, at least two vehicles have started down this path—one legal, one political—the above-mentioned AIMS vs. DEA and The Right to Try Clarification Act.

Could these upend the status quo and create legal access in the same way Australia has?

Consider this; in six months, Australia will officially launch the world’s first legal psychedelic medicine paradigm in conventional healthcare settings while the rest of the world waits on the FDA’s decision about MAPS’ MDMA and Compass Pathways’ Comp360 (psilocybin) which will not be for at least another 12 months and three years, respectively.

Bridging the Gap

Before today’s news from Down Under hit, I had been thinking about the phenomenon that I find most interesting about this emerging psychedelic field, which is the following:

The prospect of psychedelics as treatments for mental illness—as suggested by promising early scientific research—is such a novel and captivating narrative that it has driven a wave of investment, organizational creation, and widespread policy reform efforts at local, state, and federal levels.

The media attention that follows these developments can’t help but incite hype, hope, and curiosity, thus fueling an unprecedented growth of the ‘underground’ market for psychedelic substances and services before any of the ‘above ground’ efforts driving the demand have a chance to operate legally.

Except for retreat operations and ketamine clinics (and soon Australian Psychiatric clinics), the demand for psychedelic products and services is met by the underground suppliers, therapists, trip sitters, churches, and ceremonial communities operating in legal grey—or more likely outright illegal—areas.

In other words, the spectacle of the psychedelic renaissance is fomenting demand for the products and services it cannot legally supply and failing to capture the financial, practical, and scientific value.

This is, of course, the situation in cannabis where, even in legalized and regulated markets, the ‘black market’ appears to be larger than the regulated market.

But the difference between cannabis and psychedelics couldn’t be starker when it comes to one area: harm reduction.

Last week saw three funding announcements that strike me as good examples of efforts that are bridging the gap between any forthcoming legal and regulated markets and the current state of affairs in their attempts to create value through community, therapeutic alliance, and citizen science, respectively:

Othership

Othership is leaning into the social wellness movement through a breathwork smartphone app and hot-cold exposure therapies at physical locations.

Relevance to the psychedelic ecosystem comes from the below excerpt from Vine Ventures, which posits their rationale for the investment and the use case as preparation and integration for psychedelic experiences:

At first glance, Othership is a Schelling point built around community, sauna, ice baths, breathwork, and a digital component. However, when you look deeper, it’s actually solving two problems that are holding back the mental health and psychedelic renaissance.
“Prep” — there is still a stigma around mental health practices. Finding a therapist is hard and expensive, and for the most part psychedelic medicines are still illegal. These practices haven’t permeated the mainstream fast enough and are not an easily accessible first step for the average North American. They are utilized when an enormous problem exists and there are no other options, but the reality is nearly everybody with a cell phone is struggling with mental health matters of one kind or another in a rapidly changing society.
“Integration” — making behavior changes alone is extremely difficult. We’ve seen many people go through transformative experiences like meditation and psychedelic retreats and then fail to sustain positive behavioral changes upon returning home. They lack community, accountability, and regular check-ins.

Journey Clinical

Disclosure: Journey Clinical is a Beckley Waves portfolio company

Journey Clinical raised $8.5 million, led by Union Square Ventures, to expand its platform for connecting licensed therapists with resources for providing safe ketamine-assisted therapy.

Back in Unbundling Psychedelic Therapy, I highlighted why I thought the Journey Clinical approach was novel and sustainable:

“Like Roman, Hims, and other first-generation DTC Healthcare companies, JC is enabling online consultation, prescription, and shipping, but unlike these predecessors, JC is not cutting out the patient’s therapist but rather servicing them directly, and thus their patients.
JC is not really DTC; it’s more of a DTT, Direct-to-Therapist by offering therapists a prescribing service rather than trying to intermediate the patient-provider relationship…
JC’s approach to a decentralized clinic model would enable patients to journey in the comfort of their own home or the office of a therapist with whom they perhaps have a long-standing therapeutic alliance and thus an example of the current clinical infrastructure giving way to technological infrastructure.”

People Science

Psychedelics-as-therapeutics is but one breakthrough/paradigm shift underway at present.

Another revolution underway is in the approaches to clinical research that lean heavily on digital technology for data capture, monitoring, and outcome measurement.

People Science is one of a handful of companies creating a digital research platform in this area.

From the press release:

“People Science is building a new clinical research infrastructure for alternative medicines that connects people, doctors, and scientists through its technology platform, CHLOE (the Consumer Health Learning and Organizing Ecosystem). CHLOE is a modular software technology that combines a consumer-facing mobile app with a rigorous high-quality clinical research platform. Consumers can use CHLOE to help understand which alternative medicines work best for themselves. Companies and other researchers engage with People Science to test their ideas and products directly or by licensing CHLOE. Sponsored clinical studies with CHLOE began in late 2022, with the goal of launching the app to the public in early 2023.”

Neither Cannabis 2.0 nor Drug Development…but a Third, More Complex Thing

As evidenced by the Australian government’s decision to reclassify and allow for the use of MDMA and psilocybin by licensed physicians without conventional regulatory approval, the march of psychedelic policy, science, and business is full of surprises.

As the public interest in psychedelics increases and the culture becomes more comfortable with the concept of psychedelics-as-therapeutics, we should expect to see more governments and regulatory agencies make similar changes to allow access to psychedelics.

This whole psychedelic renaissance is not merely the next cannabis movement, nor is it another treatment making its way through the FDA approval process, but a third, more complex thing.

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Further Reading

Oregon Psilocybin: Slow Start

Oregon’s Psychedelic Data Would Benefit Legalization – If Done Right

Psychedelic church asks panel to let it seek religious exemption for drug use

That’s it for this week. Thanks for reading, and see you next time!

Zach

1

Someone, please correct me if I am wrong.

The Trip Report by Beckley Waves

Australia's Rescheduling of MDMA & Psilocybin…