December 30, 2021 • 55 mins
Recent years have seen a dramatic increase in start-ups and investors developing psychedelic medicines. Simeon Schanpper is a founder and managing partner of JLS Fund, a venture capital fund investing in plant based and psychedelic medicines that aim to heal illness and enhance wellness. We talked about the tensions between philanthropic and for-profit investment, the challenges and opportunities of this explosive new sector, and his own fascinating personal journey which included running a medical marijuana dispensary and psychedelic art gallery in Venice Beach, California.
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Episode Transcript
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Speaker 1 (00:00):
Hi, I'm Ethan Natalman, and this is Psychoactive, a production
of iHeart Radio and Protozoa Pictures. Psychoactive is the show
where we talk about all things drugs. But any views
expressed here do not represent those of iHeart Media, Protozoa Pictures,
or their executives and employees. Indeed, heed, as an inveterate contrarian,
(00:25):
I can tell you they may not even represent my own.
And nothing contained in this show should be used as
medical advice or encouragement to use any type of drug. Hello,
Psychoactive listeners. Today's guest is Sineon Schnapper. He is the
(00:49):
co founder and director of the j l S Fund,
which is one of the more significant investment funds placing
bets basically and learning the whole field of psychedelics, innovation
and psychedelics business. I said, say, I just met Simeon,
and interestingly enough, through another guest of Psychoactive. It was
(01:10):
Leonard Picard, who some of you may have listened to.
He was in town, we were getting to know one
another and then he brings me over to meet his
buddy Simeon Snapper, and we hit it off and so
full disclosure, Uh, you know, after hitting it off, he
asked me to be an advisor to this fund, so
I had a you know, full disclosure, I'm an advisor
to Simeon's Jails fund, and one of the one of
(01:33):
the implications of that is that if it does well,
I'll make some money as a result. Um. But also
as a result, I've enjoyed getting to know him and
really coming to appreciate the extent to which he is respected,
admired and liked in this psychedelics area. And he's also
one of the people on the investment side who's been
(01:53):
involved in this space, not just investment but psychedelics for
quite a long time. So Simeon, welcome, Thank you so much. Ethan. Well,
you know, we we recently crossed paths at uh this
wonderful conference in New York called the Horizons Conference. I mean,
actually the month before that we were down in Miami
(02:13):
at the Miami Wonderland Conference on in Business, which was
a more heavily business one. Horizons goes back, you know,
fourteen years. I think I spoke at the first one
of their conference in New York back in two thousand
and seven. But it's really growing in leaps and bounds,
and there was this incredible energy going on, and and
there is truly a psychedelic renaissance underway right now. And
(02:38):
why do you think it's happening now? Um, There's so
many ways to answer it, but the default is kind
of the conflation of you know, three major things happening.
You have, you know, regulatory stuff from the f d
A with breakthrough designation. You have the decriminalization of psycho
(03:00):
alex and or even the legalization. You have a velocity
of research coming out of universities, etcetera, etcetera. And this
is all being powered fueled by you know, what we
call generating alpha, which is money and the energy of money.
So it's really this perfect fire that's, in our opinion,
(03:21):
creating this renaissance. You know, I've mentioned on Psychoactive many
times my friend Rick Doblin, who founded MAPS back in
the mid nineteen eighties and has just been the trooper
building this thing in an incredible way. And for so
long it was all about philanthropic contributions, just as I
rely on philathropic contributions to build Drug Policy Alliance and uh,
(03:43):
you know and run the ballot initiatives and all that
sort of stuff. But now there's this remarkable infusion of funding.
I think more a lot on the philanthropic side, but
that's now I think being sort of dwarfed on the
investment side. Yes, it is, and it's it's very delicate too.
I mean there's the pure play you know, venture capitalists
(04:03):
or private equity or just investor on the money side,
and then there's how do you invest into psychedelics. But
for me, it's always been this interesting dance between the
drug world and the the energy in the world of money.
I can imagine it's a fascinating well. I mean, right now,
I see there's some companies that have gone public that
(04:24):
I have billion dollar valuations on the market. Are we
going to see many more companies going that way and
many more billion billion dollar valuations? Easily? I think you're
gonna see a lot of news and you know, this
first quarter of two you're also going to see a
shift probably from mental health to you know, everything in
central nervous system and anything that's inflammation from Alzheimer's to Parkinson's, uh, etcetera.
(04:49):
But for right now, you're definitely seeing the bunch of
companies going public and attaining you know what people call
you know, unicorn status, that billion dollar plusvaluation on senior exchanges.
For me, it's, you know, it's exciting. It's to some extent,
something I've been waiting for for you know, a few decades.
(05:10):
I've always loved starting something new, and I've always loved,
if done intelligently and done ethically, how provocative and important
money could be to help move the needle. And then
of course I've always loved the substances. So it's an
exciting time for this all to be uh kind of
colliding if you will. Yeah, well, let's break it down
for our audience then. So, I mean there was MAPS
that was out there first and real true pioneer Rick
(05:32):
Doblin and his colleagues raising tensive millions of dollars to
move forward with studies on using M D M A
a K ecstasy to treat PTSD, And they've been moving
that process through the FDA for many years and there's
a possibility they think it's quite likely in fact, that
the FDA will give a green light, uh two years
(05:52):
from now for this to be basically allowed for doctors
to prescribe UM. But MAPS was always involved in, you know,
doing everything from philanthropists, and now they've created a public
benefit corporation, basically a for profit corporation owned by the
nonprofit organization. They've just made a deal with you know,
(06:15):
a major investor and I think seventy billion dollars to
help finish this off. UM. So I you know, and
I know Rick Doblin has been worried about the role
of money emerging too quickly in this space, but he
also sees it as essential. Do you have worries? I
think worry would be too strong, but concern. I could,
(06:39):
you know, to some great extent empathize though with Rick, right.
I mean, there was all this progress for decades purely philanthropically, um,
and then something shifted, you know, about three years ago
with the kind of this opening of wait, these are
really important molecules and there's really important science going on,
(07:02):
and is this at a capital markets opportunity? So I
could definitely empathize with Rick and others who have done
such an amazing job of raising capital or getting the
donors to get m d M A where it is.
But there's a lot of other molecules and other indications,
and you know, I think it just kind of got
(07:23):
to this point where it's like, Okay, maybe we can
do something unique. Yeah, you know. You know, Rick talks
about having in some respects's been a victim of his
own success in raising so much money moving this thing forward,
and I can relate because, you know, forever and ever,
in raising the money to legalize marijuana, first for medical
purposes and then more broadly, it was entirely grounded in
(07:45):
philanthropic contributions. And even in the last years I was
doing this in fifteen sixteen, even when I could raise
a little bit of money from folks in the marijuana industry,
you know, it was always clear I would talk to
those guys because they were stakeholders, but I would never
try to raise money from them until after we had
drafted the ballot initiatives. We didn't want them to have
undo influence over it. And then once we won the
(08:07):
California initiative in twenty sixteen, everybody saw it was like
game over. Marijuana is going to be legalized across the country.
And at that point, basically many of the philanthropists were saying,
ethan at this point rely on the for profit guys.
I've been giving you the money and getting my taxi
or they couldn't get tax deductions for the ballot initiatives,
but I've been doing it philanthropically, it doesn't really make
any sense anymore. So I think Rick sometimes now find
(08:29):
themselfs competing right to get philanthropic contributions when many of
the rich guys who want to put this money in
are saying, let me just invest the whole thing, you know,
for profit. Why give away money when I could be
just you know, getting a return on my investment very directly,
It's a really difficult argument to win sometimes. And you know,
maps and Rick is one of uh several in this
(08:53):
space who you know, I've all either worked with personally
or have known over the years, and I would is
way off, like, you know, to two and a half
years ago when we started you know, quote unquote deploying
capital in the space. I thought this is gonna really
benefit the nonprofits too, and I just I totally missed
(09:15):
that because then I sat down with, you know, to
your whole point, people who had been donors in the
space for a long time, and I'm talking to them
about our fund and our o eyes and you know,
quote unquote making money as well as doing good, and
a lot of them were like, well, wait a minute.
If I'm investing and it's going to be the same outcome,
(09:39):
why wouldn't I invest and get a return which I
could donate to another industry or another area that isn't
that far along um in integrating capital markets to solve
a big problem. So it was a big like like really, yeah,
I mean you see all these universities now being up
(10:00):
with research institutes right or you know, or hostibly and
why you land going in New York, Johns Hopkins, University
of California, Imperial College in London. Uh, you know, I
know this programs at Harvard and Yale and just more
and more popping up, either into you know, a few
a few researchers or sometimes entire projects. Uh. Are those
being funded purely philanthropically or is it a mixed investment
(10:23):
where the investors are going to have some profitability to
be made from those investments. Yeah, it's definitely more of
the ladder, and each of the ones you mentioned are
unique and how they're structuring. I've definitely had the opportunity
to participate on drafting of several and I've kind of
watched certain ones evolve over the years, but generally UM.
(10:44):
The bigger ones are contemplating an interdisciplinary approach where they're
accessing everything the universities have to offer. So it's not
just the chemistry. It's the political science, it's the anthropology,
it's the math, it's the academic computing. So that benefits
them from recruiting new students to just on the science
(11:05):
side and the research side. There's always been I P
and licensing deals out of universities. That's why some universities,
I mean, if you really dig into the balance sheets,
have these endowments that are massive. And a lot of
those endowments was not just alumni donations or you know,
they had antiquities from some bygone era that appreciated in value,
(11:29):
but it was some of the deals that flowed into
the university UM from various departments that had either had
royalties or i P assignments with royalties, etcetera. So I'm
watching a whole mess of universities and colleges kind of
look at this and say, wait, if A, B and
(11:49):
C are doing it, why aren't we setting up a
psychedelic institute. And I had a call from a provost
even a month ago, and this is from a community
college they don't even have a chemistry and re church department.
And he's like, Hey, what do you know about this,
uh this institute thing? Should we do one of those?
And I'm like, and I just was like, what is happening? Well,
(12:11):
I mean, I see me. I'll tell you a funny
story about that. Rick called me last year, a year
and a half ago, and he wanted me to introduce
him to Kurt Smoke. Now, Kurt Smoke was the mayor
of Baltimore in the late eighties. Uh, and he was
the one who surprised everybody by calling for a major
reconsideration the drug war and drug prohibition at the same
(12:31):
time that I was a young assistant professor Princeton making
similar arguments. And he and I became the kind of
you know, the Baltimore mayor and the Princeton professor making
these arguments. And then he moved on from being mayor,
you know, he became the protost I think at Howard University,
and now he's the president of the University of Baltimore,
which is basically the City College of Baltimore. And Rick
wanted to meet him because the guy who founded Go Daddy,
(12:54):
he actually was interested in the issue of veterans and
veterans mental health and psychelics research and d m A.
And he I think was one of the biggest donors
of University of Baltimore, and so it was all about
saying whether this local college, University of Baltimore, could begin
to have a little psychedelics you know, research component to it.
So I think you're exactly right. It's not just the
(13:15):
major institutions, you know, it's a whole bunch of others.
Let's take a break here and go to an ad. Now,
let's just step back for a second. You know, a
lot of the focus right now is on M d
(13:36):
M A getting approved with maps effort by the f
d A. And the other one that everybody talks about
is this company called Compass, started by the Goldsmiths um
which also now has a billion dollar plus valuation in
the markets, which is looking at psilocybin I think, to
treat depression, right, And that's the other one that people
are optimistic will be approved by the FDA in coming years.
(13:57):
And so what else is on the horizon in terms
of potential treatments or companies that look to be third, fourth,
and fifth in this place, or is that the sixty
four dollar question for you as an investor in all
of this. Yeah, I would say it's a sixty three
thousand dollar question because there's no it's not a matter
of um of if you know from our thesis, it's
(14:20):
a matter of when. So whether it's if we're just
talking at the molecular level, you know, M d M
A versus psilocybin versus five M e O d M
T versus LSD. There's so many studies happening right now,
and there's so much promise that it's really going to
be based on the teams that are able to execute faster.
(14:40):
Just to back up for seconds, So for our listeners,
when Seeming is referring to a psilocybin, he's talking about
the key ingredient in mushrooms, psilocypic mushrooms. And when he's
talking about five M e O d MT, that's something
that's oftentimes associated with the toad from the Sonoran desert um.
But also it can be produced synthetically, as can be
mess s goal in, which is a key ingredient in
(15:02):
peyote or in san pedro. So those are the substance
we're talking about, but just to stick for a moment,
simeon on this research f d A route. Um do
you I mean if you had a bet like, are
what are going to be the next substances or molecules
for which types of mental health conditions? You have the molecule,
the indication, and where they're at on the f d
(15:26):
A path. So m d m A is tied right
now to the indication of post traumatic stress disorder, and
that's very close to being approved right it's in its
second clinical trial phase three. You have psilocybin or the
mushroom you'd reference compass in a phase two around the
(15:47):
indication of treatment resistant depression. So something might not go through.
There's a lot of drugs that you know, don't even
get to a phase one that are pre clinical. There's
drugs that get the phase two and then and then fail. Um.
So that's not a d and indicative, but it's a
good it's a good guess. It's a good barometer. So
(16:07):
when m DAMA gets approved for treating PTSD, at that
point it may have a more rapid progress in terms
of being used to treat other medical conditions, whether it's
an eating disorder or whether it's a range of other things,
and ditto for psilocybin, which Compass is moving forward with now. Right,
So you have those sorts of things, then you have,
you know, the question about whether something like LSD, which
(16:29):
I understand a lot of researchers don't do as much
with in part because it's a much longer experience and
therefore the time of the therapist, you know, is you know,
that costs a lot more and because LSD still has
a negative association in the public and the political mind.
Um that mesclan is a possibility, that I begins a possibility. Um,
But that in addition, there are these companies creating new molecules, right,
(16:53):
I mean, creating variants on each of these drugs that
they hope will have more upside and us downside. Yeah,
you know, a lot of people are basing this on
the you know, the odd few dozen you know, classical psychedelics,
and it's very interesting. Some companies are viewing it through
the perspective and we can make these better because it's
(17:14):
the right thing to do. Other companies are viewing if
we can make these not necessarily better, but different, so
that we can you know, turn more patients through the
door every day. UM, there's definitely a trend to you know,
for me at least, who has been you know, a
long time psycho Nott and have you know, played in
a lot of UM, a lot of different intersections of
(17:37):
this space. UM. I've always appreciated the catharsis of you know,
an actual therapeutic trip. And there's a lot of narratives
right now that are like the hallucination the trip confronting
yourself is a side effect, and let's eliminate that altogether,
presuming that we could have the same effect simply by
(17:58):
um creating the same levels of neuro plasticity and brain
chemistry that will quote unquote solve that indication. I mean,
I guess most creating compounds where you don't get nauseous,
or they last less time or things like that. Right
certainly in the fungi world, I mean we've looked at
I mean, mushrooms are and it's it's its own universe.
(18:19):
They're so amazing in general, but you could find a
strain of soelocity and depending on how you cultivate it,
eliminate the nausea from the whole effect which has been
there you know previously or commonly and the same thing
obviously can be done at the synthetic level depending on
what molecules you're looking at, So you know, to heach
(18:41):
his own on the on the side effect or uh
creating something new that's that's better or um faster or cheaper.
And when you look at all the potential mental health
conditions that are out there, what are some of the
other ones? Yeah, the answer is limited by the human
condition in but you know, the next top ten, Like
(19:03):
we're looking at a lot of invested in companies focusing
on traumatic brain injury as an example, UM, any range
of eating disorders, of which there's you know, hundreds, and
there's nuances in each of those hundreds that are different. UM.
Obviously anything in in depression from treatment resistant to m
d D too. You know, generalized anxiety disorder or social
(19:27):
anxiety disorder, which you know, I look at those indications
and they're very nuanced and very complex. But if I
look at you know, a DSM manual like so many
of those, at least in the UH generalized anything anxiety disorder,
it is like, oh my god, that's was my last
twenty four hours. Oh my god, wait, that's been my
(19:48):
last ten years. It's so pervasive. So you know, it
was a bit tongue in cheek. The the amount of
indications are only limited by the human condition at least
where we're at right now as a specie. But there's
a lot out there well so, so some of the
money has got to be made by patenting these new molecules,
right And I've heard Compass, you know, which is now
(20:11):
the biggest in the companies right now, um taking some
real flak for being overly aggressive in trying to claim
patents on things that they should not rightfully be trying
to patent and own. And you know their responses, Hey,
that's just the way people operating the patent world. But
people in the side else world are saying, we're trying
to do something different here, like cut that ship out.
What's your take on that? Yeah, I think that. I
(20:34):
think I'm more in the camp of cut that ship out, um.
And there's definitely been responses from leadership of we're going
to cut that ship out. Um. Time will tell how
true that is. I also know, you know, from other industries,
from tech, from education, like patents are the path. It's
it's how the system works. And it gets really hard
(20:56):
to like like what are we trying to do? Are
we trying to heal people and create greater patient outcomes?
And the answer I think is yes to all that.
But then the bigger question comes as the system broken
or is there a way to fix the underlying system?
By the system, you mean patents or you mean the
broader you know, nature of capitalism and capital markets, patents,
(21:19):
the US health care system, capitalism in general. Right, it's like,
we know it's not the best, and I'm not necessarily
resolving to say, well, it's what we have, because we're
always evolving, we're always iterating in civilization and certainly democracies
or governments or laws and rules. But I've definitely heard
(21:42):
and been disappointed that they didn't have a greater solution
when somebody's like, there's a better way to do this,
Like why would you invest in a company that's trying
to pat molecules? And I'm like, well, if they're new molecules,
it should be because that's a system and it drives
innovation and it protects, you know, the people who are
(22:02):
in some cases working years and years and years on
something molecular that they think is unique. Um, how else
will they be protected if not by a patent. I see. Okay,
so we're getting in the weeds here is seeming at
this point I just gotta drop back because I I
hope our audience is fully engaged here. But you know,
when you and I met, you know, you told me
a little your past, and then I have listened to
(22:24):
you speaking in other places, and so you know, I mean,
just hear you. I mean my understand as you grew
up in Chicago, but at the front end, when you're
a little kid, you were following your Peace Corps volunteer
parents around the world, and then your last years of
high school, you know, you were in Ghana in West Africa,
and then you spent a little time at the Maharishi
(22:45):
University or whatever. But meanwhile, you know, tell me in
the midst of all this, where you're you know, you
also mentioned having read the classic book Robert Masters and
Gene Houston's The Variety of Cyclic Experience. So so I mean, when,
when when do you start doing the psychelics? Are you
like a precocious thirteen year old doing it? Are you
wait till you're in college? Or yeah? I was, I
(23:06):
was really although I've I've never been accused of being precocious,
but I guess that is the best word. God. It
must have been like shortly after my bar mitzvah, and
I didn't get this feeling of like now I'm a man,
like this rite of passage, and I'm like, what else
is there? And I remember ruffling through boxes in our
basement in Roger's Park in Chicago. Um, and I found
(23:30):
two books in my dad's collection. One was Ramdas is
the only Dance there is and the other one was
The Diatic Cyclone by John C. Lily. So I must
have been, you know, um, thirteen and a half ish,
and I read them and I was like, what the
hell is this? You know, the Rabbi never told me
any of this stuff. UM. And that kind of began
(23:53):
the journey of just trying to read as much as possible.
And then around fifteen six teen, I had the great
fortune of meeting of meeting Robert Masters in gene Houston.
They had become really dear friends with my best friend
in the world. He passed away a while ago. And yeah,
(24:14):
that was the beginning of Oh, there's actually psychedelic therapeutic
protocols and you guys are playing with LSD in the Psyche.
So yeah, my teen years it was um, you know,
pretty full on. Um. Yeah, it's funny. I found Ah.
I was up at my mom's in Michigan a few
(24:35):
months ago and she said, uh, hey, sam My, you
know there's there was some water damage in the basement,
and go check out and see see what happened. And
I came across the book uh and the journal from
that time in history, So I was able to like
flip through hundreds of pages of quote unquote experiments I
(24:58):
was doing, um, you know, following uh, Bob and Jean's
book and other books I had accumulated at that time, uh,
with psychedelics. The other thing I found was a hard
drive with a bunch of bitcoins that me and my
older brother had and forgot about when we were buying
bitcoins are under a buck to buy other things. It
was a pleasant surprise. It was a very pleasant surprise.
(25:22):
Did anyone experience really stand out here in these years
that had some transformative impact or insight? Uh No, it's
like they've all kind of conflated generally, in you know,
the teen years, in the in the you know, the twenties,
was a lot of ceremony. I spent a lot of
(25:42):
time in the Amazon. I spent a lot of time
and you know, wherever there was a forest culture or
a culture that had medicine. Um. And then you know,
personally just you know, tried everything. UM. So there's no
one great experience or one one transformative experience. It's kind
of like there were hundreds and they all had meaning
(26:05):
in their own way. And I'm still working through it, um.
And I'm still petrified each time I do a substance,
even after all these years. But you know, also going
back to your younger years, I mean, I know you
were getting involved in tech, but as it's true of
many people who maybe not about many, but at least
some of the people involved in psychedelics and people involved
in tech, many of them cut their teeth on entrepreneurship
(26:28):
by doing things like selling weed or other drugs. Was
that your story as well, seeing it? Yes, it was. Um.
I was never you know, a drug dealer, but always
helped facility. No, I guess I was. You know, I
was selling like dying bags, and I always liked you know, cannabis,
and I always liked you know, other molecules. It was
(26:50):
never a full time thing. It was just like I
had the ability to source and I had the ability
to share, and sometimes I make some money on that.
So yeah, I guess technically in those early early early years. Um.
It's funny though, because um, a family member maybe a
year ago, he's like, I read this thing in the
(27:11):
the paper. Is this this ecstasy and and helping vets?
And I go yeah, and he's like is that what
you do? And I'm like, that's exactly what I'm doing.
And he's like, ah, I always thought you were just
a drug dealer. Um, so now you're legitimate. Yes, yes, indeed,
(27:32):
uh huh. Well let me ask you also. I remember
you said when we first smith this past summer, you said,
you know Ethan. You and I met before, and I
think it was at one of the early MAPS conferences
in San Jose and I think ten and then I
don't know you were you were you? Did you have
some table you're selling something back then? And and was
there something you told me about running like a psycholics
(27:52):
arts gallery and Venice Beach? How far back do you
go with this Psychelics thing? Yeah, I mean at least
on that that junk or I had opened the world's
first psychedelic art gallery and medical marijuana dispensary in two
thousand and eight city. What were you doing with the
psychedelic art gallery. Yeah, that was a I've always kind
(28:13):
of liked new new things. So I had exited a
company UM in Shanghai. I was living in Shanghai for
seven years, and I was like, what's next. And I
was kind of looking at California and my partners at
the time we're like, hey man, there's this green rush
and I'm like, well, I like, I like that's a
new business, that's a new area, and I like cannabis
(28:35):
and UM. I also really like art. Let's kind of
conflate the two UM and Yeah. So we opened the
world's first psychedelic art gallery medical marijuana dispensary. We hosted God,
I think we created like a dozen shows. Uh, We're
able to drive a lot of money to all the
nonprofits and psychedelics. I mean people would come in and cry.
(28:58):
Like they would walk into the the gallery and they'd
see the art, and then they'd walk into the dispensary
side before they got to the backyard the Garden of Weeden,
and they'd be like, I never thought this would happen
in my lifetime. Um, I mean, little did they know
we kind of It was a sketchy time in cannabis
back then. From the FED side. There were a lot
(29:19):
of raids happening. There was a lot of uncertainty. Um,
a fellow dispensary down the way I was rated, they
killed his dogs. They shot his dogs. It was just
like it was just one of those things. It's like, well,
maybe the world isn't ready for this. It came to
an end. Basically, I remember bringing everyone around a table,
(29:43):
the staff, my partners, and asking from a show of hands,
who wants to go to jail? And nobody raised their hand.
So basically, uh, you know, shifted to delivery because at
that time under prop to fifteen having a cannabis dispensary
with sketchy but so many people over those years, you know,
(30:05):
if they're not in jail, um are becoming public company CEOs,
joining scientific advisory boards. There's just been a huge shift.
So I really cherished those years then because it taught
us so much and also, you know, we got to
create this space that allowed people to talk openly about
this just felt like a very different time. Yeah, I've
(30:26):
been thinking a lot now about the lessons and similar
and differences between the way that marijuana legalization and the
commercialization has evolved and how it's happening in psychedelics as well.
And you know, you pointed out before that you know,
obviously to some extent, when you see these decrim initiatives
and legislation passing in places you know, first Denver, the
(30:49):
Oakland or recently Detroit of the statewide one in Oregon,
he's becoming models for elsewhere. There's sort of following the
model that we pioneered with first medical marijuana, marijuana legalization,
and then when you see the growing role of money
coming in all albeit in some different ways. And so
I'm curious. I mean, first of all, is there a
fair bit of overlap or people who have been invested
in the marijuana space playing in every bigger role in
(31:11):
the psychelic space or is it still fairly separate, And
if so, why, I think there's definitely crossover um from
you know, I refer to them as cannabros, and you know,
there's crypto bros and other bros. It's kind of a
generalized archetype. But because of the success on the money
(31:32):
side of the cannabis playbook, i e. You first go
public in Canada, then you presume your uplist to a
senior exchange NASDAC, New York Stock Exchange, etcetera. Cannabro saw
that and saw psychedelics and I said, oh, this is
gonna be the same. Some were good actors, many were not.
Many were You know what you hear is pump and dumps.
(31:54):
I think those have for the most part all been
eliminated because people are saying that this is more than
just the blip of a one time opportunity, that this
is going to be a vibrant, huge industry. So that's
one side, and there's definitely that camp, and there's still
activity there. On the other side, where it's completely different,
is more of a biotech pharma kinda side to it.
(32:19):
FDA trials being able to be reimbursed by insurance, you know,
tons of research and can we create the drug or
can we create the system that allows us to build
a patient um So you're kind of seeing both and
it's shifting from month to month. I'm curious also whether
there is synergy or a competition between the growing legal
(32:42):
and legally commercialized markets. On the one hand and the
underground and illicit markets. You know, the first I think
major medical merill Wanna company was out of the UK,
GW pharmaceutical And then fast forward to about ten years
ago and g W Pharmaceuticals trying to get a approval
for its medical marijuana medicine, which is a very good
(33:03):
thing to treat, you know, a type of epileptic condition
in children. Um, but they hire a former deputy drugs
are in the Bush administration to lobby against the broader
legalization of medical marijuana through the political process, and it's
just remarkably offensive. And I even see in the you know,
in the current world, you see people who are involved
(33:24):
in the legal medical or you know, adult use marijuana
markets basically pushing to ban homegrow of marijuana by individuals
or to push for tougher sanctions. I'm definitely starting to
see some of the same contentions happen around companies that
have psilocybin as a part of their you know, quote
(33:46):
unquote portfolio of i P that they're developing and watching,
you know, not just Oregon, but other states. You know,
go wait a minute, um, will psilocybin legal at the
state level before it gets through an f D A
Phase three trial, and what does that do for us?
(34:06):
So it'll be very interesting in the same way you
witness that with g W and their hiring practices, how
companies who have psilocybin and their portfolio, how they're going
to play that. When you and I first met, were
sitting on your patio and I don't know if you
(34:28):
offered me a join or not. You know, but you
New York City and many other places you have these
marijuana delivery services, and you pull out the menu of
what had been a marijuanna delivery service, but now it's
got six different types of not just you know, marijuana
chocolate bars, but you know, mushroom chocolate bars, psilocybin chocolate bars,
to C B, M, D M A, all sorts of
(34:49):
other concoctions that it just seems this extraordinarily booming um
black market in these products, which with which fortunately law
enforcement doesn't seem overly concerned and we're not hearing much
in the way of people really getting hurt, although that's
a risk. But what's your perception of what's going on
with respect to the illicit market and all these products. Now, yeah,
(35:09):
it's thriving. I mean not just similar to you know,
cannabis is now you know, legal and the majority of
the US, and the black markets even bigger. I think
as it relates to, you know, just the delivery services
in this city, and they're they're in every city, people
started to say we should sell psychedelics too, and you know,
(35:31):
I watched that because you know, I always keep a
keen eye into the gray and black markets, right, because
those are strong signals. It's in a lot of ways
the zeitgeist, right. So yeah, a lot of these delivery
services who were you know, doing pretty well selling cannabis
illegally because you know, it wasn't legal in New York.
UM said, well, if we're breaking the law anyway, and
(35:54):
we can now sell micro dose mushroom caps at and
margins and there's a demand for it, why wouldn't we.
I think there was one I saw that in parentheses.
It was for micro dose psilocybin type product and they
were calling it Upper west Side zan X. I laughed,
(36:18):
and it's like it was becoming so pervasive that, you know,
the delivery service who was focusing on that area gave
it the label and then I saw it and I
was like, well, we were and I you know, I
was like, how did you come up with that? I
was like, well, we were thinking Upper West Side divorces,
but then we learned they all take xan x and
now they're taking micro dos psilocybin and they're off the
(36:38):
xanax or other benzos, so we've just kept it Upper
West Side zanex. So those are really really big signals. Well,
you you mentioned Oregon before, right, I mean Oregon. You know,
for our listeners may people who know that Oregon in
past two ballot initiatives um each of them by about
fifty six percent margins of victory. One was an old
(36:59):
drug d krim one that basically embraced the Portugal model
where you don't put people in jail for simple drug
possession of anything. And that one was led by my organization,
Drug Policy Alliance under my successors, together with locals and Oregon.
The other one was the Oregon Psychelics Initiative, which you
don't really shocked people on bypassing, and now there's a
huge investment and making sure this gets implemented correctly. You know,
(37:22):
the State of Oregon is set up a whole implementation
board and agency. It's not just for medical therapeutic purposes
in terms of curing you know, serious illness of PTSD.
It's even for general wellness conditions. So you know, one
can do it without having been diagnosed with any sort
of significant mental illness. But I'm curious with respect to Oregon,
(37:44):
what do you see? Are there going to be significant
commercial opportunities in Oregon? Is it going to be clinics?
How is it going to transform the world. Yeah, yeah,
nobody knows exactly, but there's a lot of money coming
into Oregon betting hedging that one will get a cultivation license,
one will get you know, the equivalent of a dispensary
(38:04):
license or a clinic license. One will get the you know,
state level no bid contract to train the psychedelic assisted
you know, therapists or trip sitters or facilitators. The labels
are changing. But it's all happening like kind of in
the next year, like those quote unquote rules will be established.
(38:25):
And what's even more fathoming um is when I'm in
meetings with other legislators or other state leaders or even
other governments. It's funny. It's like this isn't verbatim, but
like somebody said, Oregon, what we're a bigger state. When's
the deadline. Let's beat him to the punch. And then
(38:47):
as we got into it, they realized, no, it's not cannabis.
Two point Oh, I'm guessing most of it as it
rolls out. Um, in Oregon and other states and other
other jurisdictions, will WILL WILL have a component of assistant therapy. Um.
How exactly that looks, no one knows exactly. But um,
(39:08):
it's a very open group, all the leadership, all the
different subcommittees. I mean, you can jump on a zoom
anytime and like watch it. You know, this living breathing
revolution in the sense of granting psychedelics to you know,
constituents or citizens of that state kind of happen overnight. Um.
The other bullet point, or the last bullet point, which
(39:30):
might kind of up end it all, is this prevalence
of micro dosing and will a regulatory body, will the
powers that be allow that to happen? And might that
be kind of an opening of the floodgates where yeah,
there's a little psychedelic in this, but it's safe and
(39:50):
it's sub perceptual and as long as you you know,
you don't take the whole bottle or the whole tab
or you know, now you have this great technology that's
able to dose you via a patch or an implant
or something else. Might that jump ahead of everything else? Yeah,
because I mean, if you think about it, right, I
mean people talk about, you know, basically the pharmaceutical industry
(40:11):
confirming a fundamental challenge because if in fact, these psychedelics
and m d m A turn out to be as
efficacious in dealing with all forms of mental illness as
the promise suggests, it means that people who have been
taking daily antidepressants, anti daily anti anxiety drugs, daily, this
and that, for which you know, insurance companies are paying
(40:32):
billions of dollars, and pharmacutic companies are making billions or
tens of billions of dollars. Now people are going to
be getting better sometimes by using a substance just once
or five or ten or twenty times in a therapeutic context,
which means that the amount of money that can be
made from that these are not repeat drugs. Essentially, So
the question becomes, I mean, first of all, are these
(40:54):
new molecules are gonna be able to charge a fortune
for these things? You know? B is the micro dose
thing going to be the one that opens up where
you know, these things become widely consumed products, and and
that's where're gonna be the big money or is the
truly big money gonna be about providing the clinics and
the therapists and the standard certification and the support services
(41:15):
and the retreats. Five ten years from now, you will
see everything you mentioned have a roll um. If someone
you know cures themselves or at least lessons, whatever their
indication is, there could always be a continuation of whatever
the molecule is, either sub or quarterly or annually. But
(41:37):
you know, humanity likes to have, you know, a single
experience that makes them feel good, but then you know,
kind of support along the way. As far as clinics retreats,
we're not doing any of those right now from the fund,
not that we don't believe in them or think there's
a great value there. But there will be an interesting
you know, I'm already starting to see it in some
(41:58):
ketamine roll ups where once these drugs, which is where
it's all starting from our legal um, and they've gone
through their trials and they're reimbursable, will there be the
need for clinics outside of a hospital. UM. And that's
where your last question about psychotherapy is a really important one,
because the presumption right now is at least the way
(42:20):
the laws are being written is including the psychedelic assistant therapy.
So I think that component is still going to stay there,
and that will afford the continual scaling of you know,
these retreats and these clinics. UM. I don't know if
I answer to your question or just created a hundred
more questions. No, I mean you sort of did, and yes,
and you did create a hundred more. But you know,
in THEA, which like Maps, is trying to figure out
(42:44):
as quickly as possible how to get the big insurance
companies and public health insurance to cover psychedelic assisted therapy,
I think in the way that some of the Kenemy
treatment is now being covered, and so obviously that seems
pivotal because that's the potential source of billions and billions
of dollars coming in to pay for all sorts of
you know, psychedelic related stuff. Do you have any insights
(43:07):
about how likely and how fast it is to happen.
It's definitely a matter of when, not if, UM, I
mean it's already happening with ketamine right. You know, even
when I had my dispensary, I figured out how to
code things to reimburse some of my patients under prop
to fifteen, almost complete reimbursability. So I do think it's
(43:32):
a matter of when, not if, for that around psychedelics,
because you know, at least in an THEA who you
had named, who's an amazing organization, they're doing it very smart,
very tactfully. And as these drugs come into market, you
know they'll be the ones who have set up the
right infrastructure and have played by the right rules and
(43:55):
have really listened. You know that you even mentioning ketamine
right here. You know. One of those speakers at the
Horizons conference, so I thought he had a great talk
was one of the leading ken amine therapist, Dr Gidabad,
And part of her speech was this pointing out that
some people think ketamine is just going to be a placeholder,
that it's not the real psychedelic um once all these
(44:17):
other types of psilocybin and m d M A center
stuff submerged. And she says, no, that's not going to
be the case. And so I'm curious, I mean, do
you agree with her. Is kenemine just gonna keep growing,
notwithstanding what happens on the n d M A and
psilocybin and other fronts, And does it provide a model
for the way these other things are going to evolve?
On the latter question, it absolutely provides a model, because
(44:38):
it's already happening, right, I mean right now if you
go to academy clinic, not the majority, but several are
the ones I've worked with are able to fully reimburse.
And you know, personally, a few years ago, I got
lime disease, and you know, basically it was in bed
for a year, just totally knocked out. Then I experienced apathy.
(44:58):
And apathy is the time like I would wake up
and I would not care about anything. I was like,
I remember waking up one day and going like, God,
I wish I cared enough even to commit suicide. It
was like nothing mattered, right, It's horrible, And it was
coming up on a holiday. So I called the you know,
the doctor who's also my GP that I helped set
(45:19):
up some of the first ketamine clinics, and I'm like,
you know, I'll be in town. You want to, you know,
grab a pointer let's meet up. And he's like absolutely,
and he's like, how's your how's your line? And I'm like, honestly,
I got this this apathy thing. Um. He's like, all right, well,
I'm booking you for a Monday, Wednesday, Friday session. Over
the holidays offices are closed, but you know, I'm just
(45:39):
gonna do you full I V And that next Saturday,
the apathy was completely gone. I was blown away, having
you know, explored ketamine for other things, and certainly having
spent time, you know, in the club world, was pretty
familiar with the effects of it. Um. I just had
(45:59):
never did for an indication I had. It was magical
and I don't know, like I didn't try m D
m A, I didn't try psilocybin, I didn't try anything else.
It was just a doctor who said, listen, I think
this could work for you. And I'm like, all right, well,
worst cases, I'll get to hang out in the ca
hole for three days this Thanksgiving week. UM. So yeah,
(46:23):
I don't think. I think every molecule has its place
based on the indication and then based on you know,
the other huge trend which I don't think we've talked about,
which is you know, precision medicine, and just the fact
that we're getting really close to being able to say, Okay,
this is your thing based on this algorithm or this
machine learning algorithm, this is the drug you need, and
(46:44):
this is the therapy you need. So that's going to
be pretty revolutionary in the next few years as well,
which will basically ameliorate this whole is one better than
the other, well, one might be better than the other
based on who you are as a human and being
your genetic profile, your how your brain talks to your gut,
the whole set setting in matrix. But I don't think
(47:08):
these others are going to replace ketamine or vice versa.
But let me take you where you were going right there,
which is looking the future. And you sad this earlier on.
You know, it's not just going to be about psychedelics
and mental health. It's gonna be about psychedelics and other
types of health and looking at the component elements of
the molecules within psychedelics. And so I'm curious, I mean,
(47:28):
and when you're talking about these other things about greater
specificity and targeting of disease, and what's the relationship between
you know, this rapid evolution with psychedelics and uh, these
broader areas of medical care, the non mental illness conditions.
There's so much anecdotal information. There's a few companies working
(47:49):
on it right now, um that are preclinical. Um, well
that's not true. Not all are preclinical, but there's a
lot that are pre clinical who are not focusing on
the narrow of mental health. They're focusing on inflammation, they're
focusing on brain degenerative disorders, they're focusing on um general health.
(48:11):
And that's going to be a big narrative as we're
able to test that these molecules also help with CNS disorders, UM, Parkinson's, Alzheimer's.
It just doesn't have the same prominence as quote unquote
mental health has because you know, again my argument that
it's the human condition. Um, everybody is dealing with some
(48:35):
some level, some severe, uh some barely even noticeable, but
could be optimized mental health issue. So it's mid December,
December fifte and I was just checking out some of
these biggest companies and looking at their stock prices, and
just this week some of the biggest ones, I think
a tie which is like the eight pound guerilla of
psycholic investment funds and Compass that we were talking about,
(48:56):
and I think a few others, like the stock prices
dive bonb this week. You know, what was that about?
Is it just a blip? Are we gonna keep seeing
these kind of things, or what's your take on it?
I think today was a combination of you know, today
was a significant day. Like you had mentioned a tie.
You know, it was very interesting that the first you know,
(49:16):
press release was about founders signing a voluntary uh memo
saying they would stay in lock up another twenty four months.
Just explain stay in lock up to our audience. Yeah,
lock up is you know, in so many of these companies,
the ones you're seeing in public markets, they were in
most cases almost unanimously private companies. And when you invest
(49:40):
in a private company, um, because you're early, you're locked up.
Like even if the company goes public, you can't sell
your shares um And that has a lot to do
with compliance and SEC and other regulatory bodies. And that's
almost always true of the founders, right or anyone who's director,
you're they cannot sell their shares until a certain lock
(50:01):
up period expires. And this isn't just psychedelics, This is
any industry. But you know, there's a lot of retail investors,
there's a lot of institutional investors who are like, well,
does the management believe in this company? And I think
that was the ovation that came out of a tie
this morning that they do and they're going to hold
for another two years and not sell a single share.
(50:24):
In theory, I mean, there's you could definitely deconstruct the
memo and see that there's ways to get out of that,
but um, that was the narrative they lead with. Now
why it dipped in value, I think a lot of
that had to do with the fact that a lot
of lock ups expired today and a lot of people
wanted to take their gains or not take more losses.
(50:46):
And that happens in every industry and anything that's public
from time to time. So I do think this is
a blip. It's also hard to argue that it's something
other than that, because how much data do we have
if we call it, you know, psychedelic public markets, we
have what a couple of years of it. You're gonna
(51:06):
look to see n s, You're gonna look at biotech
to try and to correlate it, but it's still too
early to really qualify if this is like the future,
just because today was a sell off day for for
some on the flip side. I can show you, you know, uh,
four seventeen other stocks that all rose by ten to
in psychedelics did I don't do. I don't really have
(51:30):
the bandwidth to day trade I wish. UM. I mean,
we definitely watch it for sentiment, but we're focused on
private companies. We're usually like seed to a so often
you know, well before there's a liquidity event, which is
often okay, hey it's liquid, there's money, it's it's now
(51:51):
it's public and it's on the nastact that kind of narrative. Um.
But we don't focus on on public companies in the
fund and way too busy just talking to founders and
going through decks and helping strategize to uh to be
a day trader. But if I did, today would have
been the day to do. You know. I I was
(52:13):
listening to uh, your colleague Lindsay Hoover being asked, you know,
how do you figure out what to invest in? And
she said, well, you know, it's kind of like you know,
with real estate, it's location, location, location, and when you're
investing in startups, it's the team, the team, the team.
Is there more to say beyond that about when you're
trying to make your choices and who you're gonna put
(52:33):
money on. Uh No, Lindsay really summed it up clearly,
obviously more nuanced, but you know, you bet on the
jockey and not the horse, and there's you know, a
million business metaphors to it. But yeah, we always start
with the team. Sometimes we'll see some amazing I p
or an amazing novel novelty and go to market strategy
(52:57):
that doesn't have the team yet. Um, so we'll do
some matchmaking, but we always like to start with the
people and the humans who you know, we're entrusting, you know,
our limited partners money to make them a return and
or we're entrusting them to do the right thing. And
that's that's never going to be an algorithm quite yet.
(53:18):
Um maybe in a year we'll dow it all out,
but uh yeah, team is you know, it's the people.
That's still the world we live in. So we always
start with the team. Yeah, you know, I seeming I
saw you Cuote. I don't know if you're quoting somebody
else or making this up to yourself when you say
something like we're in the business of medicalizing the mystical um,
and I guess that's as we make clear, that's not
all of it. Well, listen to Seeming. I'm grateful to
(53:40):
Leonard Picard's for introducing us, and it's a pleasure getting
to know you. I look forward to many more and
also the great success of your Jails fund. So thank
you ever so much for joining me and our Psychoactive
listeners today. It's my absolute pleasure. Ethan, thank you as well.
Have a great rest of your night. Join me next
week when I speak with Cirston Smith, a research or
(54:03):
at the National Institute on Drug Abuse who's been studying creatum,
the fascinating drug out of Southeast Asia which millions of
Americans are now using to deal with drug dependencies, pain,
or simply to improve their mood. You know, if I
didn't think creatum was going to be relevant, I wouldn't
be sitting here talking to you. I mean relevant on
many different levels, both creating products, proliferating in real world
(54:26):
studying therapeutics such that there's like a medicinal creatum situation
going on. Similar to cannabis again. You know it's not
even my gut. If I thought it was not helping people,
I would be working on something else. Subscribe to Psychoactive now,
see it, don't miss it. If you'd like to share
your own stories, comments or ideas, please leave us a
(54:47):
message at eight three three seven seven nine sixty. That's
one eight three three psycho zero. You can also email
us at Psychoactive of at protozoa dot com, or find
me on Twitter at Ethan Nadelman. And if you couldn't
keep track of all this, find the information in the
(55:07):
show notes. Psychoactive is a production of I Heart Radio
and Protozoa Pictures. It's hosted by me Ethan Nadelman. It's
produced by Katcha Kumkova and Ben Kibrick. The executive producers
are Dylan Golden, Ari Handel, Elizabeth Geesus and Darren Aronovski
for Protozoa Pictures, Alex Williams and Matt Frederick for I
(55:28):
Heart Radio and me Ethan Naedelman. Our music is by
Ari Belusian and a special thanks to a vi Vit Brio,
Seph Bianca Grimshaw and Robert Beatty,
Hi, I'm Ethan Natalman, and this is Psychoactive, a production
of iHeart Radio and Protozoa Pictures. Psychoactive is the show
where we talk about all things drugs. But any views
expressed here do not represent those of iHeart Media, Protozoa Pictures,
or their executives and employees. Indeed, heed, as an inveterate contrarian,
(00:25):
I can tell you they may not even represent my own.
And nothing contained in this show should be used as
medical advice or encouragement to use any type of drug. Hello,
Psychoactive listeners. Today's guest is Sineon Schnapper. He is the
(00:49):
co founder and director of the j l S Fund,
which is one of the more significant investment funds placing
bets basically and learning the whole field of psychedelics, innovation
and psychedelics business. I said, say, I just met Simeon,
and interestingly enough, through another guest of Psychoactive. It was
(01:10):
Leonard Picard, who some of you may have listened to.
He was in town, we were getting to know one
another and then he brings me over to meet his
buddy Simeon Snapper, and we hit it off and so
full disclosure, Uh, you know, after hitting it off, he
asked me to be an advisor to this fund, so
I had a you know, full disclosure, I'm an advisor
to Simeon's Jails fund, and one of the one of
(01:33):
the implications of that is that if it does well,
I'll make some money as a result. Um. But also
as a result, I've enjoyed getting to know him and
really coming to appreciate the extent to which he is respected,
admired and liked in this psychedelics area. And he's also
one of the people on the investment side who's been
(01:53):
involved in this space, not just investment but psychedelics for
quite a long time. So Simeon, welcome, Thank you so much. Ethan. Well,
you know, we we recently crossed paths at uh this
wonderful conference in New York called the Horizons Conference. I mean,
actually the month before that we were down in Miami
(02:13):
at the Miami Wonderland Conference on in Business, which was
a more heavily business one. Horizons goes back, you know,
fourteen years. I think I spoke at the first one
of their conference in New York back in two thousand
and seven. But it's really growing in leaps and bounds,
and there was this incredible energy going on, and and
there is truly a psychedelic renaissance underway right now. And
(02:38):
why do you think it's happening now? Um, There's so
many ways to answer it, but the default is kind
of the conflation of you know, three major things happening.
You have, you know, regulatory stuff from the f d
A with breakthrough designation. You have the decriminalization of psycho
(03:00):
alex and or even the legalization. You have a velocity
of research coming out of universities, etcetera, etcetera. And this
is all being powered fueled by you know, what we
call generating alpha, which is money and the energy of money.
So it's really this perfect fire that's, in our opinion,
(03:21):
creating this renaissance. You know, I've mentioned on Psychoactive many
times my friend Rick Doblin, who founded MAPS back in
the mid nineteen eighties and has just been the trooper
building this thing in an incredible way. And for so
long it was all about philanthropic contributions, just as I
rely on philathropic contributions to build Drug Policy Alliance and uh,
(03:43):
you know and run the ballot initiatives and all that
sort of stuff. But now there's this remarkable infusion of funding.
I think more a lot on the philanthropic side, but
that's now I think being sort of dwarfed on the
investment side. Yes, it is, and it's it's very delicate too.
I mean there's the pure play you know, venture capitalists
(04:03):
or private equity or just investor on the money side,
and then there's how do you invest into psychedelics. But
for me, it's always been this interesting dance between the
drug world and the the energy in the world of money.
I can imagine it's a fascinating well. I mean, right now,
I see there's some companies that have gone public that
(04:24):
I have billion dollar valuations on the market. Are we
going to see many more companies going that way and
many more billion billion dollar valuations? Easily? I think you're
gonna see a lot of news and you know, this
first quarter of two you're also going to see a
shift probably from mental health to you know, everything in
central nervous system and anything that's inflammation from Alzheimer's to Parkinson's, uh, etcetera.
(04:49):
But for right now, you're definitely seeing the bunch of
companies going public and attaining you know what people call
you know, unicorn status, that billion dollar plusvaluation on senior exchanges.
For me, it's, you know, it's exciting. It's to some extent,
something I've been waiting for for you know, a few decades.
(05:10):
I've always loved starting something new, and I've always loved,
if done intelligently and done ethically, how provocative and important
money could be to help move the needle. And then
of course I've always loved the substances. So it's an
exciting time for this all to be uh kind of
colliding if you will. Yeah, well, let's break it down
for our audience then. So, I mean there was MAPS
that was out there first and real true pioneer Rick
(05:32):
Doblin and his colleagues raising tensive millions of dollars to
move forward with studies on using M D M A
a K ecstasy to treat PTSD, And they've been moving
that process through the FDA for many years and there's
a possibility they think it's quite likely in fact, that
the FDA will give a green light, uh two years
(05:52):
from now for this to be basically allowed for doctors
to prescribe UM. But MAPS was always involved in, you know,
doing everything from philanthropists, and now they've created a public
benefit corporation, basically a for profit corporation owned by the
nonprofit organization. They've just made a deal with you know,
(06:15):
a major investor and I think seventy billion dollars to
help finish this off. UM. So I you know, and
I know Rick Doblin has been worried about the role
of money emerging too quickly in this space, but he
also sees it as essential. Do you have worries? I
think worry would be too strong, but concern. I could,
(06:39):
you know, to some great extent empathize though with Rick, right.
I mean, there was all this progress for decades purely philanthropically, um,
and then something shifted, you know, about three years ago
with the kind of this opening of wait, these are
really important molecules and there's really important science going on,
(07:02):
and is this at a capital markets opportunity? So I
could definitely empathize with Rick and others who have done
such an amazing job of raising capital or getting the
donors to get m d M A where it is.
But there's a lot of other molecules and other indications,
and you know, I think it just kind of got
(07:23):
to this point where it's like, Okay, maybe we can
do something unique. Yeah, you know. You know, Rick talks
about having in some respects's been a victim of his
own success in raising so much money moving this thing forward,
and I can relate because, you know, forever and ever,
in raising the money to legalize marijuana, first for medical
purposes and then more broadly, it was entirely grounded in
(07:45):
philanthropic contributions. And even in the last years I was
doing this in fifteen sixteen, even when I could raise
a little bit of money from folks in the marijuana industry,
you know, it was always clear I would talk to
those guys because they were stakeholders, but I would never
try to raise money from them until after we had
drafted the ballot initiatives. We didn't want them to have
undo influence over it. And then once we won the
(08:07):
California initiative in twenty sixteen, everybody saw it was like
game over. Marijuana is going to be legalized across the country.
And at that point, basically many of the philanthropists were saying,
ethan at this point rely on the for profit guys.
I've been giving you the money and getting my taxi
or they couldn't get tax deductions for the ballot initiatives,
but I've been doing it philanthropically, it doesn't really make
any sense anymore. So I think Rick sometimes now find
(08:29):
themselfs competing right to get philanthropic contributions when many of
the rich guys who want to put this money in
are saying, let me just invest the whole thing, you know,
for profit. Why give away money when I could be
just you know, getting a return on my investment very directly,
It's a really difficult argument to win sometimes. And you know,
maps and Rick is one of uh several in this
(08:53):
space who you know, I've all either worked with personally
or have known over the years, and I would is
way off, like, you know, to two and a half
years ago when we started you know, quote unquote deploying
capital in the space. I thought this is gonna really
benefit the nonprofits too, and I just I totally missed
(09:15):
that because then I sat down with, you know, to
your whole point, people who had been donors in the
space for a long time, and I'm talking to them
about our fund and our o eyes and you know,
quote unquote making money as well as doing good, and
a lot of them were like, well, wait a minute.
If I'm investing and it's going to be the same outcome,
(09:39):
why wouldn't I invest and get a return which I
could donate to another industry or another area that isn't
that far along um in integrating capital markets to solve
a big problem. So it was a big like like really, yeah,
I mean you see all these universities now being up
(10:00):
with research institutes right or you know, or hostibly and
why you land going in New York, Johns Hopkins, University
of California, Imperial College in London. Uh, you know, I
know this programs at Harvard and Yale and just more
and more popping up, either into you know, a few
a few researchers or sometimes entire projects. Uh. Are those
being funded purely philanthropically or is it a mixed investment
(10:23):
where the investors are going to have some profitability to
be made from those investments. Yeah, it's definitely more of
the ladder, and each of the ones you mentioned are
unique and how they're structuring. I've definitely had the opportunity
to participate on drafting of several and I've kind of
watched certain ones evolve over the years, but generally UM.
(10:44):
The bigger ones are contemplating an interdisciplinary approach where they're
accessing everything the universities have to offer. So it's not
just the chemistry. It's the political science, it's the anthropology,
it's the math, it's the academic computing. So that benefits
them from recruiting new students to just on the science
(11:05):
side and the research side. There's always been I P
and licensing deals out of universities. That's why some universities,
I mean, if you really dig into the balance sheets,
have these endowments that are massive. And a lot of
those endowments was not just alumni donations or you know,
they had antiquities from some bygone era that appreciated in value,
(11:29):
but it was some of the deals that flowed into
the university UM from various departments that had either had
royalties or i P assignments with royalties, etcetera. So I'm
watching a whole mess of universities and colleges kind of
look at this and say, wait, if A, B and
(11:49):
C are doing it, why aren't we setting up a
psychedelic institute. And I had a call from a provost
even a month ago, and this is from a community
college they don't even have a chemistry and re church department.
And he's like, Hey, what do you know about this,
uh this institute thing? Should we do one of those?
And I'm like, and I just was like, what is happening? Well,
(12:11):
I mean, I see me. I'll tell you a funny
story about that. Rick called me last year, a year
and a half ago, and he wanted me to introduce
him to Kurt Smoke. Now, Kurt Smoke was the mayor
of Baltimore in the late eighties. Uh, and he was
the one who surprised everybody by calling for a major
reconsideration the drug war and drug prohibition at the same
(12:31):
time that I was a young assistant professor Princeton making
similar arguments. And he and I became the kind of
you know, the Baltimore mayor and the Princeton professor making
these arguments. And then he moved on from being mayor,
you know, he became the protost I think at Howard University,
and now he's the president of the University of Baltimore,
which is basically the City College of Baltimore. And Rick
wanted to meet him because the guy who founded Go Daddy,
(12:54):
he actually was interested in the issue of veterans and
veterans mental health and psychelics research and d m A.
And he I think was one of the biggest donors
of University of Baltimore, and so it was all about
saying whether this local college, University of Baltimore, could begin
to have a little psychedelics you know, research component to it.
So I think you're exactly right. It's not just the
(13:15):
major institutions, you know, it's a whole bunch of others.
Let's take a break here and go to an ad. Now,
let's just step back for a second. You know, a
lot of the focus right now is on M d
(13:36):
M A getting approved with maps effort by the f
d A. And the other one that everybody talks about
is this company called Compass, started by the Goldsmiths um
which also now has a billion dollar plus valuation in
the markets, which is looking at psilocybin I think, to
treat depression, right, And that's the other one that people
are optimistic will be approved by the FDA in coming years.
(13:57):
And so what else is on the horizon in terms
of potential treatments or companies that look to be third, fourth,
and fifth in this place, or is that the sixty
four dollar question for you as an investor in all
of this. Yeah, I would say it's a sixty three
thousand dollar question because there's no it's not a matter
of um of if you know from our thesis, it's
(14:20):
a matter of when. So whether it's if we're just
talking at the molecular level, you know, M d M
A versus psilocybin versus five M e O d M
T versus LSD. There's so many studies happening right now,
and there's so much promise that it's really going to
be based on the teams that are able to execute faster.
(14:40):
Just to back up for seconds, So for our listeners,
when Seeming is referring to a psilocybin, he's talking about
the key ingredient in mushrooms, psilocypic mushrooms. And when he's
talking about five M e O d MT, that's something
that's oftentimes associated with the toad from the Sonoran desert um.
But also it can be produced synthetically, as can be
mess s goal in, which is a key ingredient in
(15:02):
peyote or in san pedro. So those are the substance
we're talking about, but just to stick for a moment,
simeon on this research f d A route. Um do
you I mean if you had a bet like, are
what are going to be the next substances or molecules
for which types of mental health conditions? You have the molecule,
the indication, and where they're at on the f d
(15:26):
A path. So m d m A is tied right
now to the indication of post traumatic stress disorder, and
that's very close to being approved right it's in its
second clinical trial phase three. You have psilocybin or the
mushroom you'd reference compass in a phase two around the
(15:47):
indication of treatment resistant depression. So something might not go through.
There's a lot of drugs that you know, don't even
get to a phase one that are pre clinical. There's
drugs that get the phase two and then and then fail. Um.
So that's not a d and indicative, but it's a
good it's a good guess. It's a good barometer. So
(16:07):
when m DAMA gets approved for treating PTSD, at that
point it may have a more rapid progress in terms
of being used to treat other medical conditions, whether it's
an eating disorder or whether it's a range of other things,
and ditto for psilocybin, which Compass is moving forward with now. Right,
So you have those sorts of things, then you have,
you know, the question about whether something like LSD, which
(16:29):
I understand a lot of researchers don't do as much
with in part because it's a much longer experience and
therefore the time of the therapist, you know, is you know,
that costs a lot more and because LSD still has
a negative association in the public and the political mind.
Um that mesclan is a possibility, that I begins a possibility. Um,
But that in addition, there are these companies creating new molecules, right,
(16:53):
I mean, creating variants on each of these drugs that
they hope will have more upside and us downside. Yeah,
you know, a lot of people are basing this on
the you know, the odd few dozen you know, classical psychedelics,
and it's very interesting. Some companies are viewing it through
the perspective and we can make these better because it's
(17:14):
the right thing to do. Other companies are viewing if
we can make these not necessarily better, but different, so
that we can you know, turn more patients through the
door every day. UM, there's definitely a trend to you know,
for me at least, who has been you know, a
long time psycho Nott and have you know, played in
a lot of UM, a lot of different intersections of
(17:37):
this space. UM. I've always appreciated the catharsis of you know,
an actual therapeutic trip. And there's a lot of narratives
right now that are like the hallucination the trip confronting
yourself is a side effect, and let's eliminate that altogether,
presuming that we could have the same effect simply by
(17:58):
um creating the same levels of neuro plasticity and brain
chemistry that will quote unquote solve that indication. I mean,
I guess most creating compounds where you don't get nauseous,
or they last less time or things like that. Right
certainly in the fungi world, I mean we've looked at
I mean, mushrooms are and it's it's its own universe.
(18:19):
They're so amazing in general, but you could find a
strain of soelocity and depending on how you cultivate it,
eliminate the nausea from the whole effect which has been
there you know previously or commonly and the same thing
obviously can be done at the synthetic level depending on
what molecules you're looking at, So you know, to heach
(18:41):
his own on the on the side effect or uh
creating something new that's that's better or um faster or cheaper.
And when you look at all the potential mental health
conditions that are out there, what are some of the
other ones? Yeah, the answer is limited by the human
condition in but you know, the next top ten, Like
(19:03):
we're looking at a lot of invested in companies focusing
on traumatic brain injury as an example, UM, any range
of eating disorders, of which there's you know, hundreds, and
there's nuances in each of those hundreds that are different. UM.
Obviously anything in in depression from treatment resistant to m
d D too. You know, generalized anxiety disorder or social
(19:27):
anxiety disorder, which you know, I look at those indications
and they're very nuanced and very complex. But if I
look at you know, a DSM manual like so many
of those, at least in the UH generalized anything anxiety disorder,
it is like, oh my god, that's was my last
twenty four hours. Oh my god, wait, that's been my
(19:48):
last ten years. It's so pervasive. So you know, it
was a bit tongue in cheek. The the amount of
indications are only limited by the human condition at least
where we're at right now as a specie. But there's
a lot out there well so, so some of the
money has got to be made by patenting these new molecules,
right And I've heard Compass, you know, which is now
(20:11):
the biggest in the companies right now, um taking some
real flak for being overly aggressive in trying to claim
patents on things that they should not rightfully be trying
to patent and own. And you know their responses, Hey,
that's just the way people operating the patent world. But
people in the side else world are saying, we're trying
to do something different here, like cut that ship out.
What's your take on that? Yeah, I think that. I
(20:34):
think I'm more in the camp of cut that ship out, um.
And there's definitely been responses from leadership of we're going
to cut that ship out. Um. Time will tell how
true that is. I also know, you know, from other industries,
from tech, from education, like patents are the path. It's
it's how the system works. And it gets really hard
(20:56):
to like like what are we trying to do? Are
we trying to heal people and create greater patient outcomes?
And the answer I think is yes to all that.
But then the bigger question comes as the system broken
or is there a way to fix the underlying system?
By the system, you mean patents or you mean the
broader you know, nature of capitalism and capital markets, patents,
(21:19):
the US health care system, capitalism in general. Right, it's like,
we know it's not the best, and I'm not necessarily
resolving to say, well, it's what we have, because we're
always evolving, we're always iterating in civilization and certainly democracies
or governments or laws and rules. But I've definitely heard
(21:42):
and been disappointed that they didn't have a greater solution
when somebody's like, there's a better way to do this,
Like why would you invest in a company that's trying
to pat molecules? And I'm like, well, if they're new molecules,
it should be because that's a system and it drives
innovation and it protects, you know, the people who are
(22:02):
in some cases working years and years and years on
something molecular that they think is unique. Um, how else
will they be protected if not by a patent. I see. Okay,
so we're getting in the weeds here is seeming at
this point I just gotta drop back because I I
hope our audience is fully engaged here. But you know,
when you and I met, you know, you told me
a little your past, and then I have listened to
(22:24):
you speaking in other places, and so you know, I mean,
just hear you. I mean my understand as you grew
up in Chicago, but at the front end, when you're
a little kid, you were following your Peace Corps volunteer
parents around the world, and then your last years of
high school, you know, you were in Ghana in West Africa,
and then you spent a little time at the Maharishi
(22:45):
University or whatever. But meanwhile, you know, tell me in
the midst of all this, where you're you know, you
also mentioned having read the classic book Robert Masters and
Gene Houston's The Variety of Cyclic Experience. So so I mean, when,
when when do you start doing the psychelics? Are you
like a precocious thirteen year old doing it? Are you
wait till you're in college? Or yeah? I was, I
(23:06):
was really although I've I've never been accused of being precocious,
but I guess that is the best word. God. It
must have been like shortly after my bar mitzvah, and
I didn't get this feeling of like now I'm a man,
like this rite of passage, and I'm like, what else
is there? And I remember ruffling through boxes in our
basement in Roger's Park in Chicago. Um, and I found
(23:30):
two books in my dad's collection. One was Ramdas is
the only Dance there is and the other one was
The Diatic Cyclone by John C. Lily. So I must
have been, you know, um, thirteen and a half ish,
and I read them and I was like, what the
hell is this? You know, the Rabbi never told me
any of this stuff. UM. And that kind of began
(23:53):
the journey of just trying to read as much as possible.
And then around fifteen six teen, I had the great
fortune of meeting of meeting Robert Masters in gene Houston.
They had become really dear friends with my best friend
in the world. He passed away a while ago. And yeah,
(24:14):
that was the beginning of Oh, there's actually psychedelic therapeutic
protocols and you guys are playing with LSD in the Psyche.
So yeah, my teen years it was um, you know,
pretty full on. Um. Yeah, it's funny. I found Ah.
I was up at my mom's in Michigan a few
(24:35):
months ago and she said, uh, hey, sam My, you
know there's there was some water damage in the basement,
and go check out and see see what happened. And
I came across the book uh and the journal from
that time in history, So I was able to like
flip through hundreds of pages of quote unquote experiments I
(24:58):
was doing, um, you know, following uh, Bob and Jean's
book and other books I had accumulated at that time, uh,
with psychedelics. The other thing I found was a hard
drive with a bunch of bitcoins that me and my
older brother had and forgot about when we were buying
bitcoins are under a buck to buy other things. It
was a pleasant surprise. It was a very pleasant surprise.
(25:22):
Did anyone experience really stand out here in these years
that had some transformative impact or insight? Uh No, it's
like they've all kind of conflated generally, in you know,
the teen years, in the in the you know, the twenties,
was a lot of ceremony. I spent a lot of
(25:42):
time in the Amazon. I spent a lot of time
and you know, wherever there was a forest culture or
a culture that had medicine. Um. And then you know,
personally just you know, tried everything. UM. So there's no
one great experience or one one transformative experience. It's kind
of like there were hundreds and they all had meaning
(26:05):
in their own way. And I'm still working through it, um.
And I'm still petrified each time I do a substance,
even after all these years. But you know, also going
back to your younger years, I mean, I know you
were getting involved in tech, but as it's true of
many people who maybe not about many, but at least
some of the people involved in psychedelics and people involved
in tech, many of them cut their teeth on entrepreneurship
(26:28):
by doing things like selling weed or other drugs. Was
that your story as well, seeing it? Yes, it was. Um.
I was never you know, a drug dealer, but always
helped facility. No, I guess I was. You know, I
was selling like dying bags, and I always liked you know, cannabis,
and I always liked you know, other molecules. It was
(26:50):
never a full time thing. It was just like I
had the ability to source and I had the ability
to share, and sometimes I make some money on that.
So yeah, I guess technically in those early early early years. Um.
It's funny though, because um, a family member maybe a
year ago, he's like, I read this thing in the
(27:11):
the paper. Is this this ecstasy and and helping vets?
And I go yeah, and he's like is that what
you do? And I'm like, that's exactly what I'm doing.
And he's like, ah, I always thought you were just
a drug dealer. Um, so now you're legitimate. Yes, yes, indeed,
(27:32):
uh huh. Well let me ask you also. I remember
you said when we first smith this past summer, you said,
you know Ethan. You and I met before, and I
think it was at one of the early MAPS conferences
in San Jose and I think ten and then I
don't know you were you were you? Did you have
some table you're selling something back then? And and was
there something you told me about running like a psycholics
(27:52):
arts gallery and Venice Beach? How far back do you
go with this Psychelics thing? Yeah, I mean at least
on that that junk or I had opened the world's
first psychedelic art gallery and medical marijuana dispensary in two
thousand and eight city. What were you doing with the
psychedelic art gallery. Yeah, that was a I've always kind
(28:13):
of liked new new things. So I had exited a
company UM in Shanghai. I was living in Shanghai for
seven years, and I was like, what's next. And I
was kind of looking at California and my partners at
the time we're like, hey man, there's this green rush
and I'm like, well, I like, I like that's a
new business, that's a new area, and I like cannabis
(28:35):
and UM. I also really like art. Let's kind of
conflate the two UM and Yeah. So we opened the
world's first psychedelic art gallery medical marijuana dispensary. We hosted God,
I think we created like a dozen shows. Uh, We're
able to drive a lot of money to all the
nonprofits and psychedelics. I mean people would come in and cry.
(28:58):
Like they would walk into the the gallery and they'd
see the art, and then they'd walk into the dispensary
side before they got to the backyard the Garden of Weeden,
and they'd be like, I never thought this would happen
in my lifetime. Um, I mean, little did they know
we kind of It was a sketchy time in cannabis
back then. From the FED side. There were a lot
(29:19):
of raids happening. There was a lot of uncertainty. Um,
a fellow dispensary down the way I was rated, they
killed his dogs. They shot his dogs. It was just
like it was just one of those things. It's like, well,
maybe the world isn't ready for this. It came to
an end. Basically, I remember bringing everyone around a table,
(29:43):
the staff, my partners, and asking from a show of hands,
who wants to go to jail? And nobody raised their hand.
So basically, uh, you know, shifted to delivery because at
that time under prop to fifteen having a cannabis dispensary
with sketchy but so many people over those years, you know,
(30:05):
if they're not in jail, um are becoming public company CEOs,
joining scientific advisory boards. There's just been a huge shift.
So I really cherished those years then because it taught
us so much and also, you know, we got to
create this space that allowed people to talk openly about
this just felt like a very different time. Yeah, I've
(30:26):
been thinking a lot now about the lessons and similar
and differences between the way that marijuana legalization and the
commercialization has evolved and how it's happening in psychedelics as well.
And you know, you pointed out before that you know,
obviously to some extent, when you see these decrim initiatives
and legislation passing in places you know, first Denver, the
(30:49):
Oakland or recently Detroit of the statewide one in Oregon,
he's becoming models for elsewhere. There's sort of following the
model that we pioneered with first medical marijuana, marijuana legalization,
and then when you see the growing role of money
coming in all albeit in some different ways. And so
I'm curious. I mean, first of all, is there a
fair bit of overlap or people who have been invested
in the marijuana space playing in every bigger role in
(31:11):
the psychelic space or is it still fairly separate, And
if so, why, I think there's definitely crossover um from
you know, I refer to them as cannabros, and you know,
there's crypto bros and other bros. It's kind of a
generalized archetype. But because of the success on the money
(31:32):
side of the cannabis playbook, i e. You first go
public in Canada, then you presume your uplist to a
senior exchange NASDAC, New York Stock Exchange, etcetera. Cannabro saw
that and saw psychedelics and I said, oh, this is
gonna be the same. Some were good actors, many were not.
Many were You know what you hear is pump and dumps.
(31:54):
I think those have for the most part all been
eliminated because people are saying that this is more than
just the blip of a one time opportunity, that this
is going to be a vibrant, huge industry. So that's
one side, and there's definitely that camp, and there's still
activity there. On the other side, where it's completely different,
is more of a biotech pharma kinda side to it.
(32:19):
FDA trials being able to be reimbursed by insurance, you know,
tons of research and can we create the drug or
can we create the system that allows us to build
a patient um So you're kind of seeing both and
it's shifting from month to month. I'm curious also whether
there is synergy or a competition between the growing legal
(32:42):
and legally commercialized markets. On the one hand and the
underground and illicit markets. You know, the first I think
major medical merill Wanna company was out of the UK,
GW pharmaceutical And then fast forward to about ten years
ago and g W Pharmaceuticals trying to get a approval
for its medical marijuana medicine, which is a very good
(33:03):
thing to treat, you know, a type of epileptic condition
in children. Um, but they hire a former deputy drugs
are in the Bush administration to lobby against the broader
legalization of medical marijuana through the political process, and it's
just remarkably offensive. And I even see in the you know,
in the current world, you see people who are involved
(33:24):
in the legal medical or you know, adult use marijuana
markets basically pushing to ban homegrow of marijuana by individuals
or to push for tougher sanctions. I'm definitely starting to
see some of the same contentions happen around companies that
have psilocybin as a part of their you know, quote
(33:46):
unquote portfolio of i P that they're developing and watching,
you know, not just Oregon, but other states. You know,
go wait a minute, um, will psilocybin legal at the
state level before it gets through an f D A
Phase three trial, and what does that do for us?
(34:06):
So it'll be very interesting in the same way you
witness that with g W and their hiring practices, how
companies who have psilocybin and their portfolio, how they're going
to play that. When you and I first met, were
sitting on your patio and I don't know if you
(34:28):
offered me a join or not. You know, but you
New York City and many other places you have these
marijuana delivery services, and you pull out the menu of
what had been a marijuanna delivery service, but now it's
got six different types of not just you know, marijuana
chocolate bars, but you know, mushroom chocolate bars, psilocybin chocolate bars,
to C B, M, D M A, all sorts of
(34:49):
other concoctions that it just seems this extraordinarily booming um
black market in these products, which with which fortunately law
enforcement doesn't seem overly concerned and we're not hearing much
in the way of people really getting hurt, although that's
a risk. But what's your perception of what's going on
with respect to the illicit market and all these products. Now, yeah,
(35:09):
it's thriving. I mean not just similar to you know,
cannabis is now you know, legal and the majority of
the US, and the black markets even bigger. I think
as it relates to, you know, just the delivery services
in this city, and they're they're in every city, people
started to say we should sell psychedelics too, and you know,
(35:31):
I watched that because you know, I always keep a
keen eye into the gray and black markets, right, because
those are strong signals. It's in a lot of ways
the zeitgeist, right. So yeah, a lot of these delivery
services who were you know, doing pretty well selling cannabis
illegally because you know, it wasn't legal in New York.
UM said, well, if we're breaking the law anyway, and
(35:54):
we can now sell micro dose mushroom caps at and
margins and there's a demand for it, why wouldn't we.
I think there was one I saw that in parentheses.
It was for micro dose psilocybin type product and they
were calling it Upper west Side zan X. I laughed,
(36:18):
and it's like it was becoming so pervasive that, you know,
the delivery service who was focusing on that area gave
it the label and then I saw it and I
was like, well, we were and I you know, I
was like, how did you come up with that? I
was like, well, we were thinking Upper West Side divorces,
but then we learned they all take xan x and
now they're taking micro dos psilocybin and they're off the
(36:38):
xanax or other benzos, so we've just kept it Upper
West Side zanex. So those are really really big signals. Well,
you you mentioned Oregon before, right, I mean Oregon. You know,
for our listeners may people who know that Oregon in
past two ballot initiatives um each of them by about
fifty six percent margins of victory. One was an old
(36:59):
drug d krim one that basically embraced the Portugal model
where you don't put people in jail for simple drug
possession of anything. And that one was led by my organization,
Drug Policy Alliance under my successors, together with locals and Oregon.
The other one was the Oregon Psychelics Initiative, which you
don't really shocked people on bypassing, and now there's a
huge investment and making sure this gets implemented correctly. You know,
(37:22):
the State of Oregon is set up a whole implementation
board and agency. It's not just for medical therapeutic purposes
in terms of curing you know, serious illness of PTSD.
It's even for general wellness conditions. So you know, one
can do it without having been diagnosed with any sort
of significant mental illness. But I'm curious with respect to Oregon,
(37:44):
what do you see? Are there going to be significant
commercial opportunities in Oregon? Is it going to be clinics?
How is it going to transform the world. Yeah, yeah,
nobody knows exactly, but there's a lot of money coming
into Oregon betting hedging that one will get a cultivation license,
one will get you know, the equivalent of a dispensary
(38:04):
license or a clinic license. One will get the you know,
state level no bid contract to train the psychedelic assisted
you know, therapists or trip sitters or facilitators. The labels
are changing. But it's all happening like kind of in
the next year, like those quote unquote rules will be established.
(38:25):
And what's even more fathoming um is when I'm in
meetings with other legislators or other state leaders or even
other governments. It's funny. It's like this isn't verbatim, but
like somebody said, Oregon, what we're a bigger state. When's
the deadline. Let's beat him to the punch. And then
(38:47):
as we got into it, they realized, no, it's not cannabis.
Two point Oh, I'm guessing most of it as it
rolls out. Um, in Oregon and other states and other
other jurisdictions, will WILL WILL have a component of assistant therapy. Um.
How exactly that looks, no one knows exactly. But um,
(39:08):
it's a very open group, all the leadership, all the
different subcommittees. I mean, you can jump on a zoom
anytime and like watch it. You know, this living breathing
revolution in the sense of granting psychedelics to you know,
constituents or citizens of that state kind of happen overnight. Um.
The other bullet point, or the last bullet point, which
(39:30):
might kind of up end it all, is this prevalence
of micro dosing and will a regulatory body, will the
powers that be allow that to happen? And might that
be kind of an opening of the floodgates where yeah,
there's a little psychedelic in this, but it's safe and
(39:50):
it's sub perceptual and as long as you you know,
you don't take the whole bottle or the whole tab
or you know, now you have this great technology that's
able to dose you via a patch or an implant
or something else. Might that jump ahead of everything else? Yeah,
because I mean, if you think about it, right, I
mean people talk about, you know, basically the pharmaceutical industry
(40:11):
confirming a fundamental challenge because if in fact, these psychedelics
and m d m A turn out to be as
efficacious in dealing with all forms of mental illness as
the promise suggests, it means that people who have been
taking daily antidepressants, anti daily anti anxiety drugs, daily, this
and that, for which you know, insurance companies are paying
(40:32):
billions of dollars, and pharmacutic companies are making billions or
tens of billions of dollars. Now people are going to
be getting better sometimes by using a substance just once
or five or ten or twenty times in a therapeutic context,
which means that the amount of money that can be
made from that these are not repeat drugs. Essentially, So
the question becomes, I mean, first of all, are these
(40:54):
new molecules are gonna be able to charge a fortune
for these things? You know? B is the micro dose
thing going to be the one that opens up where
you know, these things become widely consumed products, and and
that's where're gonna be the big money or is the
truly big money gonna be about providing the clinics and
the therapists and the standard certification and the support services
(41:15):
and the retreats. Five ten years from now, you will
see everything you mentioned have a roll um. If someone
you know cures themselves or at least lessons, whatever their
indication is, there could always be a continuation of whatever
the molecule is, either sub or quarterly or annually. But
(41:37):
you know, humanity likes to have, you know, a single
experience that makes them feel good, but then you know,
kind of support along the way. As far as clinics retreats,
we're not doing any of those right now from the fund,
not that we don't believe in them or think there's
a great value there. But there will be an interesting
you know, I'm already starting to see it in some
(41:58):
ketamine roll ups where once these drugs, which is where
it's all starting from our legal um, and they've gone
through their trials and they're reimbursable, will there be the
need for clinics outside of a hospital. UM. And that's
where your last question about psychotherapy is a really important one,
because the presumption right now is at least the way
(42:20):
the laws are being written is including the psychedelic assistant therapy.
So I think that component is still going to stay there,
and that will afford the continual scaling of you know,
these retreats and these clinics. UM. I don't know if
I answer to your question or just created a hundred
more questions. No, I mean you sort of did, and yes,
and you did create a hundred more. But you know,
in THEA, which like Maps, is trying to figure out
(42:44):
as quickly as possible how to get the big insurance
companies and public health insurance to cover psychedelic assisted therapy,
I think in the way that some of the Kenemy
treatment is now being covered, and so obviously that seems
pivotal because that's the potential source of billions and billions
of dollars coming in to pay for all sorts of
you know, psychedelic related stuff. Do you have any insights
(43:07):
about how likely and how fast it is to happen.
It's definitely a matter of when, not if, UM, I
mean it's already happening with ketamine right. You know, even
when I had my dispensary, I figured out how to
code things to reimburse some of my patients under prop
to fifteen, almost complete reimbursability. So I do think it's
(43:32):
a matter of when, not if, for that around psychedelics,
because you know, at least in an THEA who you
had named, who's an amazing organization, they're doing it very smart,
very tactfully. And as these drugs come into market, you
know they'll be the ones who have set up the
right infrastructure and have played by the right rules and
(43:55):
have really listened. You know that you even mentioning ketamine
right here. You know. One of those speakers at the
Horizons conference, so I thought he had a great talk
was one of the leading ken amine therapist, Dr Gidabad,
And part of her speech was this pointing out that
some people think ketamine is just going to be a placeholder,
that it's not the real psychedelic um once all these
(44:17):
other types of psilocybin and m d M A center
stuff submerged. And she says, no, that's not going to
be the case. And so I'm curious, I mean, do
you agree with her. Is kenemine just gonna keep growing,
notwithstanding what happens on the n d M A and
psilocybin and other fronts, And does it provide a model
for the way these other things are going to evolve?
On the latter question, it absolutely provides a model, because
(44:38):
it's already happening, right, I mean right now if you
go to academy clinic, not the majority, but several are
the ones I've worked with are able to fully reimburse.
And you know, personally, a few years ago, I got
lime disease, and you know, basically it was in bed
for a year, just totally knocked out. Then I experienced apathy.
(44:58):
And apathy is the time like I would wake up
and I would not care about anything. I was like,
I remember waking up one day and going like, God,
I wish I cared enough even to commit suicide. It
was like nothing mattered, right, It's horrible, And it was
coming up on a holiday. So I called the you know,
the doctor who's also my GP that I helped set
(45:19):
up some of the first ketamine clinics, and I'm like,
you know, I'll be in town. You want to, you know,
grab a pointer let's meet up. And he's like absolutely,
and he's like, how's your how's your line? And I'm like, honestly,
I got this this apathy thing. Um. He's like, all right, well,
I'm booking you for a Monday, Wednesday, Friday session. Over
the holidays offices are closed, but you know, I'm just
(45:39):
gonna do you full I V And that next Saturday,
the apathy was completely gone. I was blown away, having
you know, explored ketamine for other things, and certainly having
spent time, you know, in the club world, was pretty
familiar with the effects of it. Um. I just had
(45:59):
never did for an indication I had. It was magical
and I don't know, like I didn't try m D
m A, I didn't try psilocybin, I didn't try anything else.
It was just a doctor who said, listen, I think
this could work for you. And I'm like, all right, well,
worst cases, I'll get to hang out in the ca
hole for three days this Thanksgiving week. UM. So yeah,
(46:23):
I don't think. I think every molecule has its place
based on the indication and then based on you know,
the other huge trend which I don't think we've talked about,
which is you know, precision medicine, and just the fact
that we're getting really close to being able to say, Okay,
this is your thing based on this algorithm or this
machine learning algorithm, this is the drug you need, and
(46:44):
this is the therapy you need. So that's going to
be pretty revolutionary in the next few years as well,
which will basically ameliorate this whole is one better than
the other, well, one might be better than the other
based on who you are as a human and being
your genetic profile, your how your brain talks to your gut,
the whole set setting in matrix. But I don't think
(47:08):
these others are going to replace ketamine or vice versa.
But let me take you where you were going right there,
which is looking the future. And you sad this earlier on.
You know, it's not just going to be about psychedelics
and mental health. It's gonna be about psychedelics and other
types of health and looking at the component elements of
the molecules within psychedelics. And so I'm curious, I mean,
(47:28):
and when you're talking about these other things about greater
specificity and targeting of disease, and what's the relationship between
you know, this rapid evolution with psychedelics and uh, these
broader areas of medical care, the non mental illness conditions.
There's so much anecdotal information. There's a few companies working
(47:49):
on it right now, um that are preclinical. Um, well
that's not true. Not all are preclinical, but there's a
lot that are pre clinical who are not focusing on
the narrow of mental health. They're focusing on inflammation, they're
focusing on brain degenerative disorders, they're focusing on um general health.
(48:11):
And that's going to be a big narrative as we're
able to test that these molecules also help with CNS disorders, UM, Parkinson's, Alzheimer's.
It just doesn't have the same prominence as quote unquote
mental health has because you know, again my argument that
it's the human condition. Um, everybody is dealing with some
(48:35):
some level, some severe, uh some barely even noticeable, but
could be optimized mental health issue. So it's mid December,
December fifte and I was just checking out some of
these biggest companies and looking at their stock prices, and
just this week some of the biggest ones, I think
a tie which is like the eight pound guerilla of
psycholic investment funds and Compass that we were talking about,
(48:56):
and I think a few others, like the stock prices
dive bonb this week. You know, what was that about?
Is it just a blip? Are we gonna keep seeing
these kind of things, or what's your take on it?
I think today was a combination of you know, today
was a significant day. Like you had mentioned a tie.
You know, it was very interesting that the first you know,
(49:16):
press release was about founders signing a voluntary uh memo
saying they would stay in lock up another twenty four months.
Just explain stay in lock up to our audience. Yeah,
lock up is you know, in so many of these companies,
the ones you're seeing in public markets, they were in
most cases almost unanimously private companies. And when you invest
(49:40):
in a private company, um, because you're early, you're locked up.
Like even if the company goes public, you can't sell
your shares um And that has a lot to do
with compliance and SEC and other regulatory bodies. And that's
almost always true of the founders, right or anyone who's director,
you're they cannot sell their shares until a certain lock
(50:01):
up period expires. And this isn't just psychedelics, This is
any industry. But you know, there's a lot of retail investors,
there's a lot of institutional investors who are like, well,
does the management believe in this company? And I think
that was the ovation that came out of a tie
this morning that they do and they're going to hold
for another two years and not sell a single share.
(50:24):
In theory, I mean, there's you could definitely deconstruct the
memo and see that there's ways to get out of that,
but um, that was the narrative they lead with. Now
why it dipped in value, I think a lot of
that had to do with the fact that a lot
of lock ups expired today and a lot of people
wanted to take their gains or not take more losses.
(50:46):
And that happens in every industry and anything that's public
from time to time. So I do think this is
a blip. It's also hard to argue that it's something
other than that, because how much data do we have
if we call it, you know, psychedelic public markets, we
have what a couple of years of it. You're gonna
(51:06):
look to see n s, You're gonna look at biotech
to try and to correlate it, but it's still too
early to really qualify if this is like the future,
just because today was a sell off day for for
some on the flip side. I can show you, you know, uh,
four seventeen other stocks that all rose by ten to
in psychedelics did I don't do. I don't really have
(51:30):
the bandwidth to day trade I wish. UM. I mean,
we definitely watch it for sentiment, but we're focused on
private companies. We're usually like seed to a so often
you know, well before there's a liquidity event, which is
often okay, hey it's liquid, there's money, it's it's now
(51:51):
it's public and it's on the nastact that kind of narrative. Um.
But we don't focus on on public companies in the
fund and way too busy just talking to founders and
going through decks and helping strategize to uh to be
a day trader. But if I did, today would have
been the day to do. You know. I I was
(52:13):
listening to uh, your colleague Lindsay Hoover being asked, you know,
how do you figure out what to invest in? And
she said, well, you know, it's kind of like you know,
with real estate, it's location, location, location, and when you're
investing in startups, it's the team, the team, the team.
Is there more to say beyond that about when you're
trying to make your choices and who you're gonna put
(52:33):
money on. Uh No, Lindsay really summed it up clearly,
obviously more nuanced, but you know, you bet on the
jockey and not the horse, and there's you know, a
million business metaphors to it. But yeah, we always start
with the team. Sometimes we'll see some amazing I p
or an amazing novel novelty and go to market strategy
(52:57):
that doesn't have the team yet. Um, so we'll do
some matchmaking, but we always like to start with the
people and the humans who you know, we're entrusting, you know,
our limited partners money to make them a return and
or we're entrusting them to do the right thing. And
that's that's never going to be an algorithm quite yet.
(53:18):
Um maybe in a year we'll dow it all out,
but uh yeah, team is you know, it's the people.
That's still the world we live in. So we always
start with the team. Yeah, you know, I seeming I
saw you Cuote. I don't know if you're quoting somebody
else or making this up to yourself when you say
something like we're in the business of medicalizing the mystical um,
and I guess that's as we make clear, that's not
all of it. Well, listen to Seeming. I'm grateful to
(53:40):
Leonard Picard's for introducing us, and it's a pleasure getting
to know you. I look forward to many more and
also the great success of your Jails fund. So thank
you ever so much for joining me and our Psychoactive
listeners today. It's my absolute pleasure. Ethan, thank you as well.
Have a great rest of your night. Join me next
week when I speak with Cirston Smith, a research or
(54:03):
at the National Institute on Drug Abuse who's been studying creatum,
the fascinating drug out of Southeast Asia which millions of
Americans are now using to deal with drug dependencies, pain,
or simply to improve their mood. You know, if I
didn't think creatum was going to be relevant, I wouldn't
be sitting here talking to you. I mean relevant on
many different levels, both creating products, proliferating in real world
(54:26):
studying therapeutics such that there's like a medicinal creatum situation
going on. Similar to cannabis again. You know it's not
even my gut. If I thought it was not helping people,
I would be working on something else. Subscribe to Psychoactive now,
see it, don't miss it. If you'd like to share
your own stories, comments or ideas, please leave us a
(54:47):
message at eight three three seven seven nine sixty. That's
one eight three three psycho zero. You can also email
us at Psychoactive of at protozoa dot com, or find
me on Twitter at Ethan Nadelman. And if you couldn't
keep track of all this, find the information in the
(55:07):
show notes. Psychoactive is a production of I Heart Radio
and Protozoa Pictures. It's hosted by me Ethan Nadelman. It's
produced by Katcha Kumkova and Ben Kibrick. The executive producers
are Dylan Golden, Ari Handel, Elizabeth Geesus and Darren Aronovski
for Protozoa Pictures, Alex Williams and Matt Frederick for I
(55:28):
Heart Radio and me Ethan Naedelman. Our music is by
Ari Belusian and a special thanks to a vi Vit Brio,
Seph Bianca Grimshaw and Robert Beatty,
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