What is the value of the “Magic Mushroom” or Psilocybin Market?

All signs point to the rise of psilocybin technology.  This raises questions regarding the size of the future psilocybin industry.  How much will psilocybin products cost consumers?  How much will a pharmaceutical company profit from psilocybin products?  How much will investors make from psilocybin companies?

Psilocybin Gaining Traction as Safe and Beneficial Drug

Psilocybin, a molecule found in magic mushrooms has recently earned considerable attention for its potential therapeutic value.  This renewed interest has resulted from studies demonstrating the safety and efficacy of psilocybin for treating some of the world’s most intractable mental health problems, such as “treatment resistant depression,” addiction, post-traumatic stress disorder, anxiety, etc..  See generally recommendations from Johns Hopkins University Scientists for rescheduling psilocybin.

Value of the Psilocybin Market

The psilocybin market is presently in its infancy.  Due to the legal and political climate over the past 50 years, very little research and development has been done in the space.  However, the psilocybin industry has already started to emerge.  And all signs suggest that it will rapidly gain traction and grow.  (Remember cannabis?)

Arguably, COMPASS Pathways is the present leader in adopting a pharmaceutical strategy for developing psilocybin products.  COMPASS is making synthetic psilocybin and conducting clinical trials with pure synthetic psilocybin.  From COMPASS’s work, we are able to gain insight into the present cost of psilocybin.  But there is very little information about the size of the psilocybin market once psilocybin becomes available as a therapeutic.

In the United States alone, Treatment-resistant depression (TRD) costs employers up to $48 billion each year, according to a study published in The Journal of Clinical Psychiatry. Arguably, a drug effective in treating a $48 billion dollar problem would have significant potential in the marketplace. In addition, the depression medication market is expected to grow from $14.5 billion in 2014 to nearly $17.0 billion by 2020.

According to Bloomberg, Atai Life Sciences AG  (a major investor in COMPASS) is pursuing a listing on the Canadian Stock Exchange next year. Bloomberg reports that Atai will seek a valuation of $800 million or more.

The Multidisciplinary Associate for Psychedelic Studies (MAPS) led by Rick Doblin is looking to the future and seeing MDMA as a prescription drug, possibly as soon as 2022. To that end, MAPS has created a for-profit corporation to sell prescription MDMA. Communications Director for MAPS, Brad Burge, says he predicts MAPS will make $30 million over the first three to five years. Burge adds that MAPS will reinvest the $30 million into research on LSD, ayahuasca, and psilocybin to add more to the knowledge base toward their eventual legalization. When those compounds become legal medicines, that tens of millions of dollars in investment could turn into hundreds of millions of dollars.

According to a March 2018 article on Quartz, psychedelic researchers like Matthew Johnson of Johns Hopkins University pay between $7,000 and $10,000 per gram for psilocybin. That’s about 13 times the street price for dried magic mushrooms, depending on their psilocybin content.

4 thoughts on “What is the value of the “Magic Mushroom” or Psilocybin Market?

  1. Jonathan Reply

    Im conflicted by this idea of capitalism in Psychedelic arenas. Is it a noble act, is it in the best interest on the whole, not the one? Then again its a free market, perhaps my windfall would be served well by building infrastructure to embrace this new avenue of chemistry on a patenting level? Perhaps its evil incarnate?

  2. Jasper Reply

    7,000-10,000 per gram…….. That’s a laugh. Those people are getting robbed blind. Decriminalization to me means I can grow my own and not have to pay some billion dollar company an outrageous amount for a month worth of “therapy”. This whole thing is ridiculous

    • Staff Scientist Post authorReply

      Dear Jasper – The number does seem high based on the actual cost of making/attaining psilocybin. Presumably, that’s what led scientists like David Nichols to investigate alternatives, such as 4-AcO-DMT (mentioned in the article). Thanks for your comments.

    • Arek Reply

      Jasper I think you are right, but the big corporation should also be able to develop commercial products.
      Alcohol is a good example of how it could work. You can make some cider in your shed for yourself and a few friends, but opening a pub or a brewery is another thing.
      We should also be able to grow a few mushrooms at home of our consumption, but if psilocybin is used in therapist room, it should be somehow regulated.

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