The mental wellness industry has grown by leaps and bounds in recent years and it is expected to grow further in the years to come.
One of the companies that have been in focus among investors this year is Mind Medicine (MindMed) Inc (OTCMKTS:MMEDF), which works on producing psychedelics-based medicines to treat mental anxiety.
Why The Sudden Fall?
The medicines in question are made from products like magic mushrooms and LSD. Since the middle of September, the Mind Medicine stock has attracted a lot of focus from investors.
Since then the stock has rallied strongly and gained as much as 650%. But now we are seeing a sell-off and only time will tell if this is the end of the run for MMEDF.
The company is one of the biggest players in this space at this point and investors seem excited about its prospects.
That being said, it is necessary to note that it is unlikely that Mind Medicine is going to be profitable anytime soon. The company is looking to use contraband like LSD, MDMA, and psilocybin to create controllable medicines that can tackle chronic conditions like attention deficit disorder, anxiety, and opioid withdrawal among others.
Treatments for such conditions are already available in the market but many of those are not as effective. At this point, Mind Medicine has a bunch of products that are under development.
One of the more intriguing projects at Mind Medicine currently is ‘Project Lucy’ which relates to the possibility of using LSD to treat people who suffer from anxiety. The initial part of Phase 2 clinical trial into the product is being conducted in Switzerland and is expected to be concluded at some point in early 2021.
While the company does want to get the blessings of the United States Food and Drug Administration regarding these products, there are long-standing taboos about these substances.
However, giants like Johnson and Johnson have already started on this path with the launch of medicine development programs with substances like esketamine. At this point, the stock might seem like a gamble since regulatory clarity is not yet on the horizon.
However, Mind Medicine has applied for listing on NASDAQ, and on top of that, if the company’s plans do pan out then things might look quite different in 2021.