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Numinus Wellness inc: Innovating in mental health

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Numinus Wellness inc: Innovating in mental health
A leader in new therapies for mental health

Numinus is a life sciences company with a focus on mental health and wellness. The company is engaged in research, development and delivery of safe, evidence-based psychedelic-assisted psychotherapy. We argue that demand for these services is set for strong growth, driven by a growing ecosystem of companies and research institutes demonstrating the likely benefits of psychedelic-assisted psychotherapies over many existing mental health treatments, and by increasing demand for mental health and substance abuse services in North America (see p3-4) in the post-COVID environment. The company has three areas of operational activity:

Numinus Health provides psychedelic-assisted psychotherapy through four clinics in Canada, with plans for rapid growth. These clinics are developing ketamine-assisted psychotherapy (KAP) protocols for a range of mental disorders, and are also working on new compassionate access trials enabling the introduction of therapies with psilocybin and MDMA under Health Canada approvals.

Numinus Biosciences operates a licensed laboratory for applied research and IP development and R&D partnerships. The company holds a federal government approved dealer’s license covering multiple psychedelic compounds, and as well as a license to produce and extract psilocybin from mushrooms, and for the testing of cannabis products. Numinus Biosciences is a leading provider of lab services to the psychedelics and cannabis industries.

Numinus R&D is a clinical research unit developing therapeutic protocols for psychedelic-assisted psychotherapy. These protocols will be used for optimizing patient care under the current KAP therapies, and in defining clinical trials programs for future applications of psychedelic medicine.

Recent developments and investment conclusion

In recent months the company has announced a number of significant developments which move the business model forward. In February 2021 Numinus Health expanded its portfolio of clinics through the acquisition of MindSpace Psychology Services Inc, which operates three clinics in Montreal that are set to enable ketamine-assisted psychotherapy (KAP) in addition to a robust set of mental health programming.

In March 2021 Numinus Biosciences received regulatory approval to add ketamine and LSD to its existing license and to increase the volumes of psilocybin and psilocin that it is permitted to extract. The company also announced plans to expand the current footprint of the laboratory and to invest CA$1.2mln in new equipment. In February and March 2021 the company announced significant progress milestones in its Compassionate Access trials for MDMA and psilocybin assisted therapies.

From an investor’s perspective, we argue that Numinus Wellness represents a highly differentiated play on the fast-growing psychedelics space, with existing revenue streams positioned for continued growth, a growing talent pool of specialised practitioners, and a strong balance sheet position which is further improved by the additional capital raise announced on March 15 (financial details p10-13).

Year end Aug 31 2019 Current 2021 2022
Revenue (CA$-000′s) 108 881 1,996 4,751
Cash Balance (CA$-000′s) 90 1,635 52,322 40,241
Investment summary

Numinus is a mental health company focusing on research, development and delivery of safe, evidence-based psychedelic-assisted psychotherapy. The company stands out among the market listed psychedelics names in that Numinus benefits from currently existing revenue streams with the potential for strong growth in the near term and medium term.

The company has three areas of focus:

Clinics – Numinus Health

Numinus Health provides psychedelic-assisted psychotherapy through four clinics in Canada, with plans to expand on this. The company’s first clinic is based in Vancouver, and Numinus added a further three clinics, based in Montreal, via the acquisition of MindSpace in February 2021.

The Montreal clinics are set to provide ketamine-assisted psychotherapy (KAP), which is available in Canada as a therapy for treatment-resistant depression and other mental disorders. The company is also undertaking compassionate access trials (details p6) for the use of psilocybin to treat substance abuse disorder, and MDMA to treat post-traumatic stress disorder (PTSD).

Lab services – Numinus Biosciences

Numinus Biosciences operates a licensed laboratory for applied research and IP development and R&D partnerships. The facility itself is a 7,000-square foot state-of-the-art laboratory operated by a research team that includes globally recognised leaders in their respective fields. Within the psychedelic medicine space, Numinus Biosciences is engaged in the development of extraction and testing methodologies and contract research services for exploring new product formulations for third parties. The company holds a dealer’s license covering multiple psychedelic compounds and also become the first public company licensed to produce and extract psilocybin from mushrooms.

In addition, Numinus Biosciences holds a testing license for cannabis which is used to provide analytics services for the cannabis industry.

The Biosciences and Health businesses are the two revenue-generating segments of the company. The following chart shows the recent revenue history together with our forecasts.

Strong revenue growth forecast for both Health and Biosciences

Revenue outlook
Source: Proactive Research

New clinics in Montreal contribute to a revenue step-up in the coming quarters

We are forecasting a step-up in revenues in the quarter ending May 2021 due to the inclusion of the three Montreal clinics. We are forecasting further revenue growth in the next quarters due to expansion of the biosciences laboratory, and due to increased utilisation of the health clinics which have been impacted by COVID restrictions in recent quarters.

Numinus R&D

The final segment of the business is Numinus R&D, which is a clinical research unit developing therapeutic protocols for psychedelic-assisted psychotherapy. The therapeutic protocols are an essential element in optimizing patient care under the current KAP therapies, in defining clinical trials under the Compassionate Access programs, and in drafting the required proposals for other Health Canada approval mechanisms.

Essentially, the R&D business drives the ‘implementation science’ which is converting psychedelic therapy from concept into deliverable patient care.

Background – psychedelic medicine

The medical usage of psychedelic drugs was a major field of research in the 1950s and ’60s. However, much of this research was terminated in the late ’60s when the major categories of psychedelic compounds were classified as controlled substances.

There has been a significant resurgence in research into psychedelics as pharmaceuticals during the last decade. This has been driven by renewed interest in the attractive characteristics of psychedelics, including:

Psychedelics have valuable therapeutic applications, and a proven safety profile

  • Proven effects on the neurotransmitters in the brain, based on the legacy research
  • A well-understood safety profile, with low levels of addictiveness, few harmful side effects, and overdoses almost unknown

The growing acknowledgement of the limits and harms of existing psychiatric drugs and the need for improved mental health care has become more acute due to the effects of Coronavirus and lockdowns. The following statistics, from the USA, illustrate the increase in anxiety and depression over the past year.

Growing mental health epidemic
Source: Center for Disease Control

The data here relates to the USA, although the initial focus for Numinus is the Canadian market. We argue that similar drivers apply across North America, and we expect Numinus to develop a presence in both markets over time.

Another growing health crisis is substance abuse. The following data show the increase in drug overdoses in recent years.

Approaching 80,000 overdose deaths per year

Addiction – number of overdose deaths in the USA
Source: Center for Disease Control

After a plateau in 2018 and 2019, there is evidence of a renewed upswing in 2020 (only partial year data available at the time of writing). This specifically relates to overdose deaths, of which more than 80% are opioid-related. In a sense, this only scratches the surface, as it ignores more common addictions such as alcohol abuse which are less likely to show up as overdose deaths. In total, the market for substance abuse treatment in North America runs at almost US$50bn per year.

Psychedelic therapies

The use of psychedelics to combat mental health issues is a rapidly growing field of clinical research. In recent years the FDA has recognised a number of psychedelic clinical trials with breakthrough therapy designation – a designation which expedites the development of medicines that treat a serious or life-threatening condition.

The following list summarises some of the FDA designations that have been awarded:

FDA Breakthrough Therapy designation awarded to psychedelic-based therapies

Psychedelics – increasing recognition of pharmaceutical applications
Source: Proactive Research

Other clinical development programs, in the industry, involve lysergic acid diethylamide (LSD), methylenedioxymethamphetamine (MDMA) and N,N-dimethyltryptamine (DMT).

Numinus addresses this growing opportunity via both of its revenue generating businesses – Biosciences (laboratory) and Health (clinics).

Numinus Health

Psychedelic-assisted therapy administered by highly qualified mental health professionals

Numinus Health operates clinics that provide psychedelic-assisted therapies (PAP) which benefit patients’ mental health. The clinics employ mental health professionals with specialized training to deliver the best available therapeutic experience using the new techniques of psychedelic medicine. We believe that experienced and qualified practitioners will become an increasingly important competitive advantage for Numinus as the marketplace for PAP becomes populated with more competitors.

A number of Numinus’ listed peers are more focussed on the development of drug formulations. As a business strategy, we argue that Numinus’ focus on PAP offers various advantages:

  • Clinics provide a revenue base in the current timeframe, whereas new drug developments may take many years to reach approval
  • The IP in Numinus’ business model is embedded in its active laboratory research. For instance, it was the first Canadian company to grow and extract psilocybin mushrooms. Additionally, it has a base of qualified practitioners and the company’s experience of operating clinics. Drug developers by contrast may find it harder to defend IP when it is built around molecules like ketamine, psilocybin or MDMA which have been known to science for decades
  • The use of practitioner-supervised therapy will likely always be a feature of treating serious addictions like alcohol use disorder, and also serious mental health conditions such as treatment-resistant depression or PTSD. Even as new psychedelic therapies are approved, many of these will never be for patients to take home as a prescription to self-administer

Numinus’ original clinic is based in Vancouver. This was established as a mental health and substance abuse clinic and has now been realigned towards a focus on PAP. The Vancouver clinic generated revenue for Numinus during FY August 2020 but was operating below its potential capacity due to COVID restrictions.

In February 2021 Numinus Health expanded its portfolio of clinics through the acquisition of MindSpace Psychology Services Inc, which operates three clinics in Montreal that are readying to provide ketamine-assisted psychotherapy (KAP) after COVID restrictions are lifted.

Going forward the company will continue to expand its PAP business via the addition of further clinics and the addition for further types of therapy through its research activities and regulations continue to loosen:

Expansion via new clinics and potential new therapies

Two simultaneous routes for revenue expansion
Source: Proactive Research

The therapies currently being developed or delivered by Numinus fall into three categories:

Therapy with full approval for patient use:

Ketamine-assisted psychotherapy is available in Canada for patients diagnosed with treatment-resistant depression and other mental disorders including chronic pain and substance use disorders. This service is currently being readied for implementation at Numinus through the three clinics in Montreal and its Vancouver clinic once COVID-19 social distancing restrictions are lifted.

Compassionate Access programs:

Compassionate access is an important regulatory mechanism under Health Canada

Compassionate access is a program whereby Health Canada permits some patients access to a drug that is still in clinical trial stages, where the patients are not part of a placebo-controlled randomized trial. This is Health Canada’s preferred route for allowing patients access to a drug that addresses a serious or life-threatening condition but where that drug is not yet available in the market. It does require that Numinus establish clinical protocols not unlike a randomized trial.

Numinus is currently undertaking a compassionate access trial in collaboration with the Multidisciplinary Association for Psychedelic Studies for the use of MDMA in treating PTSD.

Numinus is also undertaking a compassionate access trial in collaboration with Syreon Corp. for the use of psilocybin in treating substance abuse disorder.

Special Access Programs:

Special access programs are another vehicle used by Health Canada to permit patient access to drugs that are not available on the market. This can be unrelated to any clinical trial process. The regulations have, until now, prohibited the use of restricted drugs such as psychedelics under special access. However, during 2020 Health Canada signaled its intention to reverse this ruling and has recently concluded a consultative period regarding the change of rules.

Numinus is developing protocols for therapies using MDMA and psilocybin for various conditions, with the intention of delivering these therapies under Special Access programs or other Health Canada approved mechanism assuming that the proposed regulatory changes are implemented.

Numinus Biosciences

Numinus Biosciences operates a 7,000-square foot state-of-the-art research facility in British Columbia to support laboratory investigations into the full range of psychedelics-based therapies. Services at the laboratory are delivered by a research team made up of leading chemists, biochemists, biologists, and product development specialists. Of note, the lab previously operated as Salvation Botanicals Inc and the team has a longstanding history of working with plant medicines. The Biosciences service offering can be broken into three categories:

Three categories of research and analytics services

  • Contract research and R&D partnerships with psychedelic medicine developers, including analytics, testing, and consulting. The laboratory is licensed to handle a wide range of psychedelic compounds
  • Cultivation, extraction and formulation of psilocybin from mushrooms
  • Cannabis testing and analytics for third parties

Numinus Biosciences holds three important licenses from Health Canada which enable the company to undertake work that is not widely offered elsewhere:

  • Dealer’s licence to import, export, possess, test, and distribute MDMA, psilocybin, psilocin, DMT, and mescaline
  • The first public company licensed to cultivate and extract psilocybin from mushrooms
  • A cannabis testing licence

The company has recently announced three significant developments which support the continued growth of Numinus Biosciences.

In January 2021 Numinus announced that is had signed a lab services agreement with Optimi Health Corp for research and development with psilocybin-producing mushrooms. Optimi is developing a brand focussed on the use of functional mushrooms for health and wellness. This agreement gives Numinus exposure to the consumer health customer base.

In March 2021 Numinus received regulatory approval to add ketamine and LSD to its existing license and to increase the volumes of psilocybin and psilocin that it is permitted to extract annually, to 750 grams and 250 grams respectively.

Also in March 2021 the company announced plans to expand the current footprint of the laboratory and to invest CA$1.2mln in new equipment in addition to the new mass spectrometer that was recently acquired.

Based on the existing growth trajectory and the new developments, we are forecasting significant revenue growth for Numinus Biosciences in the coming quarters. We also note that the August quarter tends to be seasonally the strongest for this business, based on the cannabis growing season.

The following chart illustrates the growth trajectory for Numinus Biosciences.

Revenue growth
Source: Numinus historic data, Proactive Research forecasts

With a growing landscape for companies targeting the psychedelic healthcare space, we believe that demand for specialized lab services is set to continue growing. Numinus is well-placed to maintain a position of market leadership based on its facilities and equipment, personnel, licenses, and track record as a reliable partner.


A key component of Numinus’ business strategy is the company’s ability to partner with leaders in various fields of psychedelics-based science and commerce. The following examples highlight some of the opportunities that can be accessed via the collaborative approach.

Partnering with industry leaders to expand the reach of Numinus’ business

Source: Proactive Research

In December 2020 the company announced a collaboration agreement with the Multidisciplinary Association for Psychedelic Studies (MAPS) to seek approval for a compassionate access trial for the use of MDMA to treat post-traumatic stress disorder.

In November 2020 Numinus announced that it will undertake a compassionate access trial in collaboration with Syreon Corp for the use of psilocybin-assisted therapy to address substance abuse disorders.

In January 2021 the company announced a lab services agreement with Optimi Health for the research and development of Canada-grown psilocybin-producing mushrooms.

Partnership agreements provide a degree of validation of Numinus’ recognition within the industry as a leader in the development of psychedelic-based healthcare. They also give Numinus access to an enlarged pool of expertise to further the company’s ability to deliver care to patients.

Key people

Numinus has assembled an executive and scientific team that includes individuals who are globally recognised leaders within their specialist field. The following list gives some examples of the people who are delivering on the company’s strategy

Payton Nyquvest – Chairman and CEO

Former Director, VP and Head of Sales at Mackie Research Capital. Fifteen years of experience in investment banking, raising over $100mln for private and public companies. Former investment advisor with Jordan Capital Markets and Canaccord Financial.

Dr Evan Wood, MD, PhD – Chief Medical Officer

Dr Wood has published over 500 scientific articles and made major contributions to the establishment of therapeutic programs. His contributions to public policy played a role in the legalization of cannabis in Canada, the establishment of supervised injecting for intravenous drug users and the establishment of national clinical therapeutic guidelines for a number of substance abuse disorders. He was previously Professor of Medicine at the University of British Columbia and a founding executive director of the British Columbia Centre on Substance Use.

Michael Tan, MBA – Chief Operating Officer

Former and first executive director of the British Columbia Liquor Distribution Branch’s Cannabis Division. Mr Tan successfully launched recreational cannabis operations in British Columbia. Twenty years’ operations management, strategic planning, and execution with national and multinational corporations including Hudson’s Bay, Saks Fifth Avenue and UPS. Seasoned, high-impact operations, product development and marketing executive with a track record of driving performance excellence and profitable revenue growth.

Sharan Sidhu – Science Officer and General Manager

Regulatory expert and policy advisor for restrictive high-growth industries. Managed several compliance projects as well as developing requirements for LIMS, GLP, GACP and GMP alongside methods development, vendor qualification, ISO standards and training. Extensive experience as a key strategist for research road maps, core initiatives and development of research requirements and management of research projects and development of intellectual properties. Experience as a conduit for academia, industry and governing directorates to ensure research and development objectives meet regulatory compliance at all phases of pipelines from inception to commericialization.

Dr Devon Christie, MD, CCFP, IFMCP, RTC – Medical Director and Member of the Clinical Advisory Council

Dr Christie is a family physician and Registered Therapeutic Counselor. She has served as a teacher in the Certificate in Psychedelic-Assisted Therapies and Research post-graduate program at the California Institute of Integral Studies. She is also a recognized speaker on the potential for incorporating psychedelic-assisted psychotherapy in an integrated healthcare model.

Financial position

Numinus has a strong balance sheet position to continue financing its growth strategy. Since the last reported quarter’s end (November 2020) the company has raised significant additional capital through a bought deal equity raise and through the exercise of existing warrants.

The company last updated on its capital position on January 28, reporting a cash balance of CA$28.4mln. The following chart summarises the cash movements.

CA$65mln on the balance sheet as of March 2021

Capital raised and utilized, since November 2020
Source: Proactive Research

On March 15, the company announced an additional bought deal equity raise for gross proceeds of CA$40.25mln (upsized from CA$35mln originally announced), which we include in the above chart and in our forecasts (p11-13). Of the CA$40.25mln raised, CA$11mln is intended for the acquisition of new clinics and purpose-built facilities, and CA$2mln for expanding the R&D program. The remainder will be used for general corporate expenditures and working capital.

Furthermore, the company still has approximately 28 million warrants outstanding in-the-money, at an average exercise price of CA$0.6, which would equate to an additional CA$16.8mln capital inflow. We believe that the existing cash balance, even before the additional warrants, leaves the company strongly positioned for the next two years. Our full financial forecasts are on p11-13.


Numinus offers investors exposure to the great potential growth in a new generation of mental health care employing the properties of psychedelics.

The company benefits from the following advantages:

Numinus is well positioned to lead the growth of psychedelic medicine

  • Existing revenue streams, with visible growth drivers for 2021 and 2022e
  • Early mover advantage in integrated therapist-led psychedelic healthcare solutions
  • A strong balance sheet position

The company addresses a market opportunity in the US$100bn range. We argue that as the growth journey progresses, shareholders could realise significant upside from the current market cap.

Financial forecasts

The following tables summarize our financial forecasts for Numinus.


Story by ProactiveInvestors


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