Big Pharma companies have built empires out of human pain without managing to come close to addressing the number one cause of disability in the world: Depression, a disease that costs the economy a trillion dollars in lost production every year.
But while Big Pharma is turning over billions in addiction-forming opioids and anti-depression narcotics, biotech is stepping into the gaping hole in healthcare and it’s attracting trillions of dollars in investment from financing legends.
This is the great awakening, and it’s creating a multi-trillion dollar industry at record speed.
That record speed and multi-trillion-dollar price tag is the result of global desperation to get out in front of a growing epidemic of depression.
This is the massive reawakening, and it’s all about fixing the brain rather than pumping patients full of expensive anti-depression medications that don’t work and have negative side effects.
The U.S. Federal Drug Administration (FDA) has now designated psilocybin, a classical compound found in “magic mushrooms”, as a “breakthrough therapy” for the treatment of major depressive disorder three times, most recently on March 13.
And the world’s largest clinical trial ever into the use of psilocybin for treating depression at London hospital in what scientists are hailing as a “milestone” in mental health research.
This compound could help reset the brain for the treatment of people with depression, anxiety, PTSD, and many other disabling diseases. It could even help tackle the addiction created by Big Pharma as it cashed in on the opioid bonanza.
The best way to destigmatize something is to talk about it. We’re already far beyond that with psilocybin. Billions in investment, large-scale clinical trials, and what has now become a game of patents make this a high-stakes development.
Multi-billion-dollar IP is up for grabs, and Big Pharma is doing much more than circling around the startups.
Johnson and Johnson (NYSE: JNJ) has gone all in on its fastest growing drug for depression, SPRAVATO, whichisthe only FDA-approved psychedelic medicine on the market. In its Q4 2023 earnings released in January, JNJ reported a 74.1% increase in sales of SPRAVATO worldwide and views the drug as its next billion-plus product.
And some of the core team members behind the development of the SPRAVATO intellectual property have now joined a small, but emerging NYSE American-listed company, CYBIN (NYSE:CYBN) (NEO:CYBN) — the most recent to enter breakthrough territory.
CYBIN has now been granted “Breakthrough Therapy Designation”, and is the first adjunctive psychedelic-based therapy for Major Depressive Disorder (MDD) to ever receive this FDA designation.
CYBIN just finished its Phase 2 MDD (major depressive disorder) study showing a sustained benefit four months after the second dose, with 60% of patients on 12mg and 75% on 16mg in remission.
With FDA guidance on trial design, CYBIN (NYSE:CYBN) (NEO:CYBN) now has the potential to significantly reduce drug development timelines, and its gearing up to initiate its Phase 3 MDD study this summer.
“It is a testament to the hard work and dedication of the entire Cybin team that we have accomplished so much so quickly,” Doug Drysdale, CEO of Cybin, said in a release.
“The granting of Breakthrough Therapy Designation by the FDA underscores the potential of CYB003 to fill a gap in the treatment landscape for MDD and serves to expedite and de-risk our development program going forward. This designation provides for a streamlined review process and enhanced engagement with the FDA.”
Calculating CYBIN’s broad collection of assets and IP in North America, two investment banks published price targets of more than 10X CYBIN’s current share price in the third quarter of last year.
Oppenheimer initiated coverage on CYBN (NYSE:CYBN) (NEO:CYBN) last year, saying it was encouraged by the results so far, and believed the stock would have room to run further with new results, with a price target of $4.
Likewise, in an August 28, 2023 company update, H.C.Wainwright & Co. reiterated its “buy” rating on CYBN (NYSE:CYBN) (NEO:CYBN), with a price target of US $10.00 per share, after the recent Small Pharma acquisition, which it sees as strengthening Cybin’s position in short-acting psychedelics.
But with impressive Phase 2 results showing remission after only two doses and a coveted FDA designation, this small company is now poised for much greater attention from investors.
Phase 2: Behind the Breakthrough Therapy Designation
CYBIN (NYSE:CYBN) (NEO:CYBN), is developing differentiated, next-generation therapeutics that hope to offer fast, sustained therapeutic effects that are safe and tolerable, with efficacy in only 1-2 doses and short in-clinic times.
The company is on the leading edge of transformational psychedelic therapeutics, developing novel and proprietary therapeutics to improve clinical outcomes and the mental health and wellbeing of patients. The emerging biopharmaceutical company already has clinical validation of the novel, proprietary CYB003 molecule, which demonstrates a rapid-acting and robust psychedelic profile, but at a low dose.
And it’s been pounding the patent pavement, too.
In August, CYBIN agreed to acquire Small Pharma Inc in an all-share transaction that creates an international clinical-stage leader in novel psychedelic therapeutics. The companies’ combined portfolios, at closing, will include two proprietary, advanced clinical programs in development for depression and anxiety disorders with demonstrated safety and efficacy. The combined portfolio creates the industry’s largest, most advanced, well protected DMT program.
The combined company has the intellectual property strength of 29 patents granted and 158 patents pending in the psychedelic drug development sector. That is the largest portfolio in the industry.
Phase 2 topline efficacy data for the company’s CYBOO3 was one of the biggest drivers of value for CYBIN in the near-term, and the results were even better than expected.
Now that it’s been granted “Breakthrough Therapy Designation”, CYBIN (NYSE:CYBN) (NEO:CYBN) is targeting the potential for its CYB003 to achieve “Best-in-Class Status”, and it’s confident it has a solid shot at this.
In targeting depression, CYBIN’s (NYSE:CYBN) (NEO:CYBN) CYB003 is hoping to offer a lifeline to a chronic illness that victimizes some 280 million people around the world. They are also targeting what is now recognized as the leading cause of disability in the world, which costs the global economy an estimated $1 trillion in lost productivity annually. It’s everyone’s problem, which makes any breakthrough a significant development.
Current treatment options leave millions behind and neglected, as first-line treatments only work for approximately one-third of patients, and even that decreases in efficacy as time goes on. Additionally, it strikes out at the murky world of antidepressants that often have dose-limiting adverse effects.
This is where the world of “adjunctive” therapy for massive depressive disorder could become the solution to a problem of epidemic proportions. Adjunctive therapy allows for treatment without relying on background medications, without withdrawal symptoms and without logistical hurdles.
Nowhere But Up: The Next Near-Term Catalysts
Next up, CYBIN (NYSE:CYBN) (NEO:CYBN) plans to initiate its Phase 3 study of CYBOO3 in MDD in the middle of this year, with the Phase 2 study of CYB004 in Generalized Anxiety Disorder (GAD) launched on March 15.
For the Phase 2 proof-of-concept study of CYB004, CYBIN is using its proprietary DMT molecule in development for the treatment of GAD, following the FDA’s clearance of its new drug application in January.
“We are building on foundational investigative work from our Phase 2a trial of intravenous SPL026 (DMT) which showed preliminary evidence of effectiveness treating anxiety with rapid onset of antidepressant effects and reduction in anxiety scores,” Drysdale said in a press release.
The future of mental health care is all about molecular science.
“The molecular structure of psilocybin, a naturally occurring psychedelic compound found in ‘magic mushrooms,’ allows it to penetrate the central nervous system and the scientific and medical experts are just beginning to understand its effects on the brain and mind and its potential as therapeutics for mental illnesses,” according to Johns Hopkins Center for Psychedelic and Consciousness Research.
What makes Cybin’s pipeline so important to the new world of mental health is that from the start, it has set out to create novel and improved psilocybin molecules, while others in the space have been relying on generic materials that are not proprietary.
This is a space where proprietary IP is absolutely essential, and Cybin now has 29 patents granted and 158 patents pending. That makes it the leader of intellectual property in this space.
Cybin (NYSE:CYBN) (NEO:CYBN) has taken two molecules—DMT and psilocybin—and focused on the deuteration, which improves the molecules’ efficiency. In other words, it eases the path of the molecule into the brain, making it much faster and much more potent with a lower dose.
Lower doses mean more potency, and proprietary materials will have to lead this charge, giving the company with the most IP a huge advantage.
“Getting it out of the periphery and into the brain is now becoming much faster, without causing side effects,” says Drysdale. “If you get the molecules out of the bloodstream and into the brain, you’re making it more efficient”.
There is an enormous need to address Major Depressive Disorder, the leading cause of disability due to mental illness which cost the U.S. alone $326 billion between 2010 and 2018–a period during which some 17.5 million American adults suffered from the chronic mental illness.
A breakthrough is desperately needed, and Cybin’s CYB003 is working quickly towards it.
With its IP catalog, acquisition agreement, and near-term catalysts, one could argue Cybin’s market cap is trading below its potential for the coming months and years.
The team behind Cybin (NYSE:CYBN) (NEO:CYBN) has made billion-dollar breakthroughs with other companies before. Between then, they have managed 60 IND (Investigational New Drug Application) programs, bringing many new products to market, with 37 exits.
Members of Cybin’s team were involved in the development of the molecule S-K, which J&J turned into SPRAVATO – the fastest growing drug in its neuroscience portfolio, and J&J’s next billion dollar drug.
Topping that all off, Cybin advisor Tom Laughren was head of FDA psychiatry for twenty five years, and CEO Drysdale has over three decades of building drug development companies, with 17 acquisitions on three continents and executive management of four pharmaceutical companies.
CYBIN (NYSE:CYBN) (NEO:CYBN) is a clear leader in the biotech race for an alternative to the antidepressant empire, and now it has breakthrough therapy status, and is the first adjunctive therapy known to achieve this for massive depressive disorder. The advantages are significant. That means it can fast-track development and expedite manufacturing with priority review and accelerated approval status.
With a combined portfolio of patents that give them a leadership position and more data expected before the end of this year, there may only be a small window of opportunity to catch Cybin before it breaks out.
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