You’re about to embark on a professional journey which will likely help millions of people. The medicinal psychedelic space is an exciting sector which is rising from an incredible history of development, criminalization and scientific breakthroughs.
Many people are excited about this emerging industry due to its potential return on investment, but if you’re here you’re likely in it for something else: to be a part of an evolution in modern medicine.
Medicinal psychedelics and psychedelic-assisted therapy is showing incredible promise to treat a variety of mental health disorders. In the following business plan sample you’ll see exactly what goes into a successful psychedelic company start-up.
1. Executive Summary
Moonradish Medicine Ltd. (The Company) was incorporated in the Province of British Columbia on June 5, 2020 by founding partners Allen Smith and Max Tambert. The company is involved in the research and development of psychedelic drugs including psilocybin mushrooms, LSD, MDMA, and DMT for medicinal use.
Moonradish Medicine is committed to advancing how psychedelics can deliver safe, evidence-based solutions to a rampant increase in mental health disorders such as anxiety, depression, addiction, and ADHD. With controlled research, the company aims to demonstrate the medicinal benefits of LSD microdosing, LSD experiential therapy, 18-MC, psilocybin microdosing, and MDMA-assisted psychotherapy for post-traumatic stress disorder (PTSD).
Medicinal psychedelics is an emerging industry with just a handful of noteworthy players. Moonradish Medicine has a formidable opportunity to develop a significant market position by attracting an expert team of academics and industry professionals early on. In partnership with universities, health centers, and pharmaceutical companies, Moonradish Medicine intends to advance industry knowledge of medicinal psychedelics through applied research and clinical trials.
Moonradish Medicine Ltd. is seeking a $500,000 investment in return for a 40% equity stake. The company will recruit top scientific and medical leaders who share the company’s “patient first philosophy,” while founding partners Allen Smith and Max Tambert will lead the business side of Moonradish Medicine. Both Allen and Max have the business experience and foresight to scale Moonradish Medicine to become an industry leader.
At a time when addiction, anxiety, depression, ADHD and suicide rates are at historic highs, we must pursue psychedelics as a legitimate substitute to mental health issues. Psychedelic drugs themselves do not address the underlying causes of mental illness; they allow patients to open their eyes to past wounds and deep conflicts, process them, and create new meanings.
1.1 Mission Statement
In response to growing mental health disorder rates, our mission is to advance medicinal psychedelics, as a legitimate alternative to modern medicine.
1.2 Vision Statement
Our vision is a modernized healthcare system which provides more effective, less addictive solutions to a global mental health challenge.
2.0 Business Opportunity
Medicinal psychedelics have gained a respectful and highly inquisitive position in the scientific community, helping to destigmatize their use and create opportunities in public markets.
Moonradish Medicine holds a distinctive position at a pivotal time in drug development history. As we lead the research and development of medicinal psychedelics, we continue to advance knowledge of how psychedelics can support patients with underlying mental health issues.
“Our goal is to be the global leader in the research and development of medicinal psychedelics and bring relief to millions of people suffering from mental health challenges.”
-Max Tambert, Chief Operating Officer
2.1 The Problem
A healthcare system which beats for profits, not solutions.
Big pharma has controlled the medical space, and has squashed advancement in medicinal psychedelics, as they pose a substantial risk to their business model. They aim to sell more of their existing medications, by gaining support from provincial and state governments. With significant resources allocated to government and physician relations and university funding, the pharmaceutical industry has a hold on the health-care system. This influence ultimately affects the type of medications the public are prescribed.
It is now known that a significant factor leading to the current opioid crisis was the over-prescribing of highly addictive pain medication. Purdue Pharma, for example, launched an aggressive marketing campaign aimed at promoting OxyContin, which made the company more than $30 billion in North America while leaving millions untreated and addicted. These expensive, harmful and often highly addictive medications are often worse than the underlying physical or mental health challenge. In essence, the problem is how our system operates: putting profits before patients.
Growing mental health disorder rates.
● An estimated 26% of Americans ages 18 and older, about 1 in 4 adults, suffer from a diagnosable mental disorder.
● Many people suffer from more than one mental health issue at a given time. In particular, depressive illnesses tend to co-occur with substance abuse and anxiety disorders.
● Most people who commit suicide have a diagnosable mental disorder, most commonly a depressive illness or a substance abuse issue.
● Approximately 18% of people aged 18- 54 have an anxiety disorder. Anxiety disorders include: panic disorder, obsessive-compulsive disorder (OCD), post-traumatic stress disorder (PTSD), generalized anxiety disorder (GAD), and phobias (social phobia, agoraphobia, and specific phobias).
Addiction is wreaking havoc in our communities.
● 2 Hours – The average time that passes between deaths in Canada by illicit drug overdose
● 1 in 5 – The number of Canadians who suffer from addiction in any given year
● 50% of Canadians will be affected by mental health issues by the age of 40 (many of these will have addiction issues)
● 93% increase in overdose deaths amongst First Nations communities in BC from 2019-2020
● US$ 2.5 Trillion – The cost of the opioid crisis in the USA from 2015-2018
● #1 Cause – Opioid and heroin is now the #1 cause of accidental death in Canada and the US for people under 50.
2.2 The Solution
A new paradigm in mental health care.
The scientific community, institutions and society are awakening to the potential of medicinal psychedelics. They can offer a solution to both patient wellbeing and profit margins: they provide more effective and less addictive treatment to patients, and they could generate significant revenue for companies producing them in return.
There are still many advancements to be made in psychedelic pharmacology; although, we do know a few things: they are known to be non-chemically addictive, and patients often undergo a deeply spiritual experience, leaving with a positive, open-minded outlook. Sadly, since the enactment of the Controlled Substances Act (CSA) of 1970 and the United Nations Convention on Psychotropic Substances of 1971, psychedelics have been unjustly classified as harmful, illicit substances. These measures halted an academic pursuit to understand them or to use them to support the mounting mental health disorder rates.
Fortunately, public opinion is swaying for the decriminalization and medicinal usage of psychedelics. Psilocybin, LSD, DMT, and MDMA can help provide millions suffering with mental health disorders with a more affordable, less addictive, therapeutic solution. What is truly unique about psychedelics is their ability to help patients introspect, enabling them to heal, rather than numb their problems. As these substances become less stigmatized, they can also support strong corporate risk management by limiting the negative patient outcomes seen from other prescription drugs.
3 Industry Analysis
The burgeoning psychedelic sector is attracting attention from investors as more companies in the industry have gone public and research has rapidly increased due to greater mainstream and government acceptance and decriminalization.
Decades of research have demonstrated that psychedelics are effective in treating mental disorders such as depression, suicidal thoughts, PTSD and anxiety. The Food and Drug Administration has approved and fast-tracked several clinical research trials to support the growing number of people with mental health issues with new treatment options.
Dozens of biopharmaceutical companies are competing against one another to develop intellectual property for synthesizing psychedelic molecules to help treat mental health disorders. There is a smaller subset of investing verticals in the psychedelic space as it is more of an intellectual property race to develop drugs.
The US medicinal psychedelic sector faces challenges since many institutional investors are prohibited from investing in Schedule 1, 2 and 3 drugs. This challenge opens up an attractive opportunity for retail investors to get in at an early stage.
There are more than a dozen psychedelic clinical trials underway in the US, spearheaded by public companies and organizations including the Multidisciplinary Association for Psychedelic Studies, or MAPS, a nonprofit research and educational organization that studies psychedelics and marijuana for a drug to treat PTSD.
Canada began its path toward legalizing psilocybin in August when the minister of health allowed four cancer patients to use psychedelic mushrooms, which are naturally occurring, as part of their end-of-life psychotherapy treatment. Advocacy was conducted by TheraPsil, a nonprofit coalition that works for legal access to psilocybin therapy for palliative Canadians.
Many American? pharmaceutical companies listed their companies in Canada because regulators have allowed them to go public. In Canada, LSD, psilocybin, mescaline and DMT are considered Schedule 3 drugs, unlike in the US.
A second wave of research for psychedelics began over the past few years after being halted in the 1970s globally. In 2017, MAPS received FDA approval for MDMA-assisted psychotherapy for PTSD. The Imperial College opened the Centre for Psychedelic Research in London, and Johns Hopkins opened the Center for Psychedelic and Conscious Research in 2019.
3.1 Total Available Market
Markets Are Massively Underserved
Estimated $100+ billion global addressable market for psychedelics.
Key Markets:
$4.5B Anxiety – Global annual anxiety drug sales
$9.1B ADHD – Global annual ADHD drug sales
$42B Addiction – Substance abuse treatment market
$4B Depression – Global annual depression drug sales
3.2 Market Growth Rate
The medicinal psychedelic sector is projected to grow at a compound annual growth rate (CAGR) of 16.3% in the next decade to $6.85 billion by 2027. Growth factors are mostly due to the increasing pervasiveness of global mental health disorders.
3.3 Key Competitors
Compass Pathways
https://compasspathways.com
UK based, Compass Pathways navigates mental health pathways through psilocybin assisted therapy. To this point the company’s clinical development program has focused on psilocybin for depression.
Mind Med
https://mindmed.co
Mind Med offers a toolset – from breakthrough medicines and technology to compassionate therapy. For patients and therapists that account for the entire, complex patient journey.
Numinus
https://numinus.ca
Numinus conducts research to standardize the extraction of psilocybin from mushrooms. The amendment means Numinus is the first publicly traded company in Canada to be granted a licence by Health Canada to conduct research of this kind.
4 Business Model
Identify opportunities in medicinal psychedelics through the scientific community and strategic partnerships.
Advance industry knowledge of psychedelics through Health Canada regulated clinical trials while partnering with pharmaceutical companies.
Position with universities, health centres, and insurers to license our protocols and medications.
Identify. Advance. Position.
4.1 Operational Strategy
1. Secure $100,000 of pre-seed business funding.
2. Establish our website as a resource for our team, investors, academics and government agencies.
3. Obtain a controlled drug and substance dealers license through Health Canada with attached R&D licensing for specific tests.
4. Establish a strong management team, legal counsel, and advisory and medical boards.
5. Partner with a reputable university which shares our values and vision.
6. Partner with an established addictions facility that is willing to participate in multi-year studies.
7. Acquire a secure building and laboratory that exceed the regulatory requirements of Health Canada.
8. Begin research and development of psychedelics to be brought to clinical trial in the near future.
9. Identify a drug research niche which can lead to the establishment of intellectual property.
10. Make a scientific breakthrough resulting in the establishment of our very own intellectual property (IP).
4.2 Unique Selling Point
Our unique selling point is our involvement in addiction research and our advancement of psychedelic-assisted therapy for patients suffering from substance abuse disorders.
4.3 Revenue Streams
1. Pharma Partnerships – Creating multiple products by partnering with pharmaceutical companies to get our products from clinical trials to market
2. Psychedelic-Assisted Therapy – Creating products that can be used specifically in therapy treatments
3. Contract Manufacturers – Manufacture psychedelics for other companies, as we could use our facility to grow and produce the psilocybin needed to supply other companies
4. IP Establishment – Make a scientific breakthrough in medicinal psychedelics that we can license as our very own intellectual property
4.4 Medicinal Psychedelic Opportunities
LSD – Lysergic acid diethylamide
Anxiety Disorders
Market Leader: Mind Medicine Inc.
Project Lucy: Addressing Anxiety with LSD-Assisted Therapy
Therapists are a vital piece of the overall support system a patient needs to overcome mental and behavioral health conditions. The importance of the human element cannot be understated. Project Lucy involves a hallucinogenic dosing of LSD to treat anxiety, administered by a therapist. LSD increases brain communication and supports talk therapy by expanding the mind and minimizing inhibitions. MindMed is currently preparing to initiate a Phase 2b human efficacy trial for experiential doses of LSD.
Adult ADHD
Market Leader: Mind Medicine Inc.
While ADHD is often associated with children and adolescents, adults living with the disease face numerous challenges from debilitating struggles with time management and impulsivity to mood swings and disorganization. Existing medicines to treat ADHD can be highly addictive themselves and have dangerous long term effects on health. Many people do not get treatment, and many prefer to suffer versus taking the risks associated with treatment. Microdosing refers to a smaller, non-hallucinogenic dose of LSD. In these cases, the medicinal properties of the compound address the illness and may not require a hallucinogenic dose as a component of healing. Extensive anecdotal evidence suggests microdosing LSD may: increase focus, decrease anxiety, increase creativity, and improve mood. Rigorous scientific trials are in progress to validate these claims and ensure the highest standards of quality, safety, and efficacy for medical use if approved. This is where MindMed’s Microdosing Division comes in.
Psilocybin Mushrooms
Treatment-Resistant Depression
Market Leader: Compass Pathways
Sometimes depression doesn’t get better, even with treatment. ‘Treatment-resistant depression’ (TRD) is a term used when people with depression do not respond adequately to at least two different antidepressant medications. Depression is the leading cause of disability and ill health worldwide. Up to two-thirds of people with depression are not helped by the first antidepressant medication they try. Up to a third of people with depression are failed by multiple attempts at treatment. We received FDA Breakthrough Therapy designation for our programme of psilocybin therapy in treatment-resistant depression in 2018. We are conducting a randomised controlled phase IIb study of psilocybin therapy in 216 patients with treatment-resistant depression in 22 sites across Europe and North America. The study looks at the safety and efficacy of psilocybin therapy in treatment-resistant depression, and aims to determine the optimal dose of psilocybin with three doses investigated.
DMT – Dimethyltryptamine
Depression, Addiction, PTSD
Market Leader: “Opportunity, Least Researched”
DMT-assisted therapy has shown progress in disorders that have rumination, habits and bias as key symptoms, such as depression, substance abuse, and PTSD. These are internalizing disorders, in which negative thoughts are reiterated over and over again. The theory of how psychedelics work is by increasing disorder within brain networks (as shown in brain imaging studies) and activating particular serotonin receptors all over the cortex, which disrupts the way that the brain normally processes information. Simultaneously, pathways that involve inward-focused thinking, like the default mode network (where hyperactivity in this region has previously been shown to correlate with excessive rumination), decrease their activity levels acutely and normalize post treatments. This process serves to disintegrate and subsequently reintegrate pathways acting as a ‘reset’ mechanism. To the brain, a high-dose psychedelic experience is like shaking up a snow globe, disrupting unhealthy patterns of thought and providing an opportunity for them to resettle differently. This helps the patient to receive and benefit much more from the psychotherapy that wraps around the administration of DMT. Small Pharma believes that DMT has distinct advantages in that the psychedelic experience is short in comparison to that induced by other psychedelics but based on the intensity of the experience, and on the psychotherapy provided with DMT, the therapeutic benefit is likely to be significant.
MDMA – Methylenedioxymethamphetamine
Post Traumatic Stress Disorder
Market Leader: Multidisciplinary Association For Psychedelic Studies
MAPS’ highest priority project is sponsoring Food and Drug Administration (FDA) drug development research into 3,4-methylenedioxymethamphetamine (MDMA)-assisted psychotherapy for the treatment of posttraumatic stress disorder (PTSD). FDA has designated MDMA-assisted psychotherapy for PTSD a Breakthrough Therapy, and has come to agreement with MAPS on Phase 3 protocol designs after a rigorous Special Protocol Assessment (SPA) process. MAPS’ goal is to develop MDMA-assisted psychotherapy for PTSD into an FDA-approved prescription treatment. The Phase 3 trials are expected to be complete in 2022, meaning that FDA could approve the treatment as soon as 2023. MAPS is also initiating Phase 2 trials in Europe.
Ibogaine
Opioid Addiction
Market Leader: Universal Ibogaine Inc.
Current treatment options for opioid and other forms of addiction do not work for most people. What’s missing is the ability to fast track the withdrawal process. Ibogaine’s long-lasting metabolite decreases or eliminates cravings and removes the overwhelming compulsion to use drugs for approximately 2-4 months following treatment.
● Extremely fast acting, plant-based, naturally-occurring substance.
● Paired with the right treatment protocol it alleviates withdrawal symptoms and interrupts the process of active addiction.
5 Marketing Strategy
Eclipsing Modern Health Care
Our marketing strategy will be dictated by Health Canada’s regulations on how medicinal psychedelics can and cannot be marketed. We understand the importance of a creative marketing strategy, and we will exercise our abilities to advertise as strategically as possible.
5.1 SWOT Analysis
Strengths
-early mover advantage
-based out of Canada: a friendly jurisdiction to drug decriminalization and medicinal research
-strong initial investment from Founding Partners Weaknesses
-need to partner with an academic institution
-inability to earn revenue in the first few years
-need to establish management team, advisory and medical board
Opportunities
-partnership with a pharma company
-partnership with an academic institution
-intellectual property establishment
-$100B+ total addressable market
-mental health associations partnership Threats
-change in political will that may revert advancements in policy
-unknowns of decriminalization or legalization
-big pharma lobbying against the medicinal psychedelic industry
5.2 Key Channels
Website
● Search Engine Optimization (SEO)
● Google Search
● Google Ads
Media
● Business News Network (BNN)
● Social Media
Government Bodies
● Health Canada
● Food and Drug Association (FDA)
Mental Health Associations
● Centre for Addiction and Mental Health (CAMH)
● Canadian Mental Health Association (CMHA)
● Mental Health Commission of Canada (MHCC)
5.3 Target Audience
Individuals suffering from:
● Addiction Disorders
● Anxiety Disorders
● Depressive Disorders
● Post Traumatic Stress Disorders
6 Financial Projections
6.1 Opening Balance Sheet
6.2 Income Statement
7 Management Team
Allen Smith
Chief Executive Officer
Allen has 10 years of management experience in the mining industry, where he worked throughout Canada for Alma Minerals Inc. As a mining professional Allen assisted in the business development of Alma, helping to secure contracts with Tegan Mining, Jake Mining and Base Minerals . Today, as an impact investor, he is focused on supporting businesses with measurable social impact in addition to equitable financial returns. Allen sees the high potential that psilocybin, LSD, DMT and MDMA have to offer in treating so many of today’s mental health challenges.
Max Tambert
Chief Operating Officer
Max has 14 years of experience in the mining industry. For the first 9 years he worked across Canada for Boomerang Mining. In 2015 he was offered an opportunity with Global Mining Corp. to oversee operations of a mining operation in Uganda. Later, he returned to Canada as a mining consultant for Braid Energy, then continued his work abroad in Mongolia, overseeing an offshore mining operation in the capital. Max’s diverse work experience provides him with the leadership qualities to help scale Moonradish Medicine Ltd.
7.1 Key Personnel
Chief Executive Officer – CEO
● Responsible for the strategic direction of the company
● Managing the overall operations and resources of the company
● Acting as the main point of communication between the board of directors and corporate operations
Chief Operating Officer – COO
● Designing and implementing business operations
● Establishing policies that promote company culture, vision
● Overseeing operations of the company and the work of executives
Chief Medical Officer – CMO
● Keeping staff updated on new healthcare regulations
● Reporting to the Chief Executive Officer and Board of Directors
● Act as an Advisor
Chief Financial Officer – CFO
● Managing relationships with investors and investment institutions
● Identifying and managing business risks and insurance requirements
● Hiring, training and retaining skilled accounting and finance staff
Chief Communications Officer – CCO
● Manage company brand and reputation
● Ensure public views the organization favorably
● Create and launch press releases and marketing campaigns
● Create rich and creative content that is optimized for search engines
Senior Research Scientist
● Planning and conducting experiments, recording and analysing data
● Carrying out fieldwork, presenting results to senior/other research staff
● Writing research papers, reports, reviews and summaries
● Ensuring that quality standards are met
General Advisory Board
● Offer assistance to Moonradish Medicine with anything from marketing to managing human resources to working with regulators
● Offer innovative advice and dynamic perspectives.
Medical Advisory Board
● Review the (AIU) website and other communications for medical accuracy
● Make recommendations regarding education programs, research and materials especially when funding is available and the association is ready to implement grant programs
● Participate in appropriate activities that enhance AIU and the medical communities.
7.2 Compensation Summary
8 References
MindMed Investor Deck
https://mindmed.co/wp-content/uploads/2020/11/investor-deck.pdf
Why New Investors Shouldn’t Fear The Psychedelic Industry
https://thedalesreport.com/life-sciences/why-new-investors-shouldnt-fear-the-psychedelic-industry/
Psychedelic Drugs Market
https://www.prnewswire.com/news-releases/psychedelic-drugs-market-projected-to-reach-6-859-95-million-by-2027–301069861.html
The Pharmaceutical Industry
https://globalnews.ca/news/5769443/big-pharma-paying-doctors-hospitals/
Why Investing in Psychedelic Medicine Could Be Better Than Cannabis
https://money.usnews.com/investing/articles/why-investing-in-psychedelic-medicine-could-be-better-than-cannabis
Conclusion
We hope you enjoyed this psychedelic company business plan sample. There is so much that goes into writing a detailed, and accurate business plan; let alone in an emerging industry.
Utilize some of the angles this business plan provides, but also work to create your own, unique medicinal psychedelic business. Remember, in order for your company to be successful you must create something that no one else offers. A good place to start is by understanding the market, and how each player differentiates themselves. By understanding what’s being done you can recognize the problem you’re looking to solve.
Please feel free to reach out with any questions, or inquiries. At BSBSCON we take pride in offering the best business plans available. We treat each and every client like they are our last – constantly challenging ourselves to raise the industry bar. You can do it yourself, but don’t forget how important your business plan is in the first six months, year and five years. We’re in it for the long haul; to provide a blueprint for your business which is implementable, yet unique.
Thanks, and we look forward to hearing from you.
