Psychedelics Are Going Mainstream. Investing in Them Hasn’t.

Psychedelics spent a half-century in political and medical purgatory. Now they’re starting to go mainstream. Respected academic institutes and billionaires are funding research into their therapeutic benefits, and the Food and Drug Administration could soon approve MDMA (known more commonly as ecstasy) for a treatment for post-traumatic stress disorder. 

The therapeutic potential of these drugs looks promising, but Wall Street and big pharma are still not convinced of the financial potential. Intellectual property is one big concern. While new compounds discovered in a lab can often lead to over a decade of exclusive profits for a pharma company, psychedelics like LSD and psilocybin, the psychoactive compound in “magic mushrooms,” have been around for a long time. This makes patenting them more controversial. Companies are patenting formulations of the drugs and even things like the cozy furniture in a treatment room, but questions about patent protection abound.