The Wonderland psychedelic business conference, held in Miami last month, drew large crowds and big-name keynote speakers — such as former heavyweight boxing champion Mike Tyson — with the promise of a booming new sector.
Experts suggested that the next big development in mental healthcare would come in the form of psychedelic drugs: substances such as psilocybin (magic mushrooms), ayahuasca (a plant-based mixture from South America) and DMT (a naturally occurring hallucinogenic).
While these substances have been illegal in the US and primarily associated with countercultures, such as the hippies of the 1960s and ravers of the 1990s, changes in laws and scientific breakthroughs in psychedelic treatments for depression and anxiety have created a new industry projected to be worth ￡8 billion (US$10.6 billion) by 2027.
Illustration: Mountain People
Much as happened with the cannabis industry a decade ago, a culture clash is now developing between social justice advocates who fought for the legalization of psychedelics and wealthy white men, often new to the drugs, who have the resources to dominate an emerging industry.
Two years ago, Denver, Colorado, voted to decriminalize psilocybin mushrooms. It was quickly followed by Oakland and Santa Cruz in California, the state of Oregon and then Seattle, which added ayahuasca, ibogaine and non-peyote-derived mescaline to the list.
Some of these campaigns enjoyed financial support from large companies such as organic soap producer Dr Bronner’s.
Celebrities — including actors Megan Fox, Will Smith and Jada Pinkett-Smith, as well as talk show host Chelsea Handler — have testified to the psychologically transformative powers of a psychedelic trip.
As the buzz around these drugs heralds a new industry, will those profiting maintain the countercultural ideals of the people who popularized the drugs?
“This isn’t the 1960s all over again,” then-MindMed chief executive officer J.R. Rahn told Forbes magazine as his company was attempting to get approval from the US Food and Drug Administration (FDA) for its specific types of LSD to treat anxiety. “I want nothing to do with those kinds of folks who want to decriminalize psychedelics.”
Much of the effort to legalize such substances is centered on offsetting the damage that the “war on drugs” has caused in impoverished communities — often by promising people of color an economic path into this new, lucrative industry.
However, for many of the early investors in psychedelics who are able carry the legalization baton to the finishing line, the strategy is often to craft a limited version of the industry that places them exclusively in charge.
“The idea that psychedelics should only be used to heal something that is broken within you — rather than as a way to communally understand our world — is the narrow definition that will get FDA approval,” said Students For Sensible Drug Policy executive director Jason Ortiz, who cofounded the Minority Cannabis Business Association. “That communal bonding will be lost if we’re only pressing it into pills.”
Ortiz fears that if psychedelics fall exclusively into the hands of big pharmaceutical firms, plants often deemed sacred by Native Americans — and the surely lucrative industry awaiting them — would follow the same path as the legal marijuana industry.
Legalization here has seen the rich get richer, while minorities and psychedelic pioneers were left out in the cold.
“There’s an institutionalization of psychedelic drugs happening that will make them less accessible to the common person,” Ortiz said. “A lot of these corporations come from big pharma and have established networks within the FDA. Movements for justice threaten that monopoly by saying that folks should be able to cultivate, sell and consume these substances on their own.”
Ortiz is pursuing decriminalization for all psychedelics, allowing individuals to make their own choices about whether and how to take them. He views the pharmaceuticals industry as a threat to that.
However, Enveric Biosciences chief executive officer Joseph Tucker said that to “do it the pharma way” would simply provide users with more confidence, a better experience and fewer side effects.
He pointed to the synthesis of willow bark into aspirin in the 19th century — turning a traditional cure into a more effective, less toxic medicine.
Florida-based Enveric is creating psychedelic-derived molecules and synthetic cannabinoids for the treatment of mental health disorders, and is pursuing FDA approval for its products.
“With psilocybin, there can be cardiotoxic effects if it’s taken every day, and there’s also serotonin syndrome,” which is caused by excessive levels of the neurotransmitter in the body, Tucker said. “But the biggest issues are with the trip itself. Bad trips rely on three major variables: dose, [mind]set and setting. So people try to really control the mindset and setting, and that constrains how you’re able to utilize those therapeutics. In many clinical trials, 90 percent of patients are screened out for having the wrong mindset, and so it won’t work for them.”
Tucker pointed to ketamine — an anesthetic that is often erroneously characterized as a psychedelic because of its history as a club drug — as an example of a drug with psychedelic effects that has been shown to be effective in mental health treatments, independent of therapy.
Ketamine’s approval for “off-label” use, and its proven efficacy in treating depression and anxiety, has led to a number of clinics popping up across the US where people with those conditions can legally access it in a medically supervised environment.
Elsewhere, the head of Los Angeles-based Irwin Naturals, Klee Irwin, said: “What I’ve done for 27 years is collect the best of what’s around and put it together into something accessible for all people. So I’ll take what indigenous people have discovered through some herbal concoction, and I’ll take it and put it into a bottle that you can get at Walmart.”
As a publicly traded company and health supplement supplier for big US retailers such as Costco, Walgreens, CVS and Walmart, Irwin Naturals has the track record to commercialize and legitimize psychedelics.
In 2018, Irwin had to convince his more conservative investors that cannabis-derived cannabidiol (CBD) products were a smart, and not too risky, endeavor: He was proved right when the company became one of the largest CBD wholesalers in the nation.
Before the Wonderland conference, Irwin made headlines by announcing that his company would enter the markets for psychedelics and tetrahydrocannabinol, the psychoactive component of cannabis.
“I wouldn’t have been able to do this two years ago: It would’ve been too scary,” Irwin said. “But right now there’s this perfect quiet before the storm — an opportunity for us to slip in [to the psychedelics industry] as the first truly household-name brand, which can be viewed publicly as a validation of plant medicine. Soon it will be far less demonized, and there’ll be a whole bunch of people dogpiling in just to make money.”
Irwin distinguishes himself from those motivated exclusively by profit by his intention to keep prices low and thereby make the products accessible to all income groups. In this way, he feels the necessary social justice goals can be achieved via big business.
“When we started selling CBD, we collapsed the pricing floor by selling it at half the price per milligram of the lowest-priced producer,” he said. “Since we are the largest, we can bully our competitors to chase us to the floor in terms of pricing, and we are about to do the same thing with marijuana.”
Irwin sees the mental health crisis in the US as an emergency that warrants an FDA fast-track for psychedelic drug approval — as was achieved with COVID-19 vaccines — and he believes companies with the power to drive the prices down should do so as a public good.
“There are around 600 ketamine clinics in the US, and they’re all mom-and-pop-owned, like video stores before Blockbuster,” Irwin said. “What we want to do is acquire some of them, and open up some new ones.”
For psychedelics such as psilocybin and ayahuasca, which are not approved in the US, Irwin is opening retreats in nearby countries such as Costa Rica and Jamaica, preparing his company for what he sees as inevitable drug law shifts in the US.
Ortiz said that on the whole, large investments in the psychedelic industry are not inherently bad so long as people of all levels of privilege have access to the substances and the chance to enter the industry.
“That will help dissolve the stigma around these substances, and there will be countless people who have their mental health issues addressed, and that’s a good thing for society in general,” Ortiz said. “That being said, it’s important that it’s not solely owned by anyone.”
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