PsyBio Therapeutics is developing psychoactive compounds which could be a mental health game changer

• Has initiated pilot scale-up of its biosynthetic formulation of psilocybin
• Developing a bacterial biosynthesis process for tryptamine production
• Well capitalized in an oversubscribed raise

What PsyBio Therapeutics does:

PsyBio Therapeutics Corp (CVE:PSYB) is a biotechnology company developing a portfolio of biosynthetic psychoactive compounds aimed at the treatment of mental illness and neurological disorders.

The US-based company is building a portfolio of natural, non-natural, and novel formulations of psychoactive medications using genetically modified bacteria. PsyBio believes a paradigm shift for the treatment of mental health issues is “long overdue” and is focused on developing a new class of drugs.

Psychoactive medications treat the illness by rewiring the brain through contemplation and a change of perception in combination with psychotherapy versus the standard treatment which just chemically treats symptoms.

PsyBio has a collaboration with Miami University in Ohio where they have filed intellectual property for biosynthesized psilocybin, its intermediates, and other molecules. They have retained the global exclusive rights to a proprietary platform technology that biologically synthesizes psilocybin and other targeted next-generation psychoactive compounds that are produced naturally in Psilocybe Cubensis and other fungi.

According to the company, their proprietary biosynthesis drug discovery platform is likely to spur the “rapid generation” of highly stable compounds “far cheaper, faster and greener” than any other method.

The company is headed by co-founder and CEO Evan Levine, who has a strong track record as the former CEO of Adventrx Pharmaceuticals and managing partner at Brown Simpson Asset Management.

The PsyBio team has broad experience in drug discovery utilizing synthetic biology. It also has extensive clinical and regulatory experience in moving drugs through human studies and regulatory protocols.

How is it doing:

PsyBio has been busy across all fronts as it gears up to clinical development.

In August 2021, the firm kicked off a new program to study N-methyl-D-aspartate (NMDA) receptor antagonists and associated analogs for potential activity against a variety of human health conditions.

The company said it has filed a new provisional patent application with the United States Patent and Trademark Office entitled NMDA Receptor Antagonist-Containing Compositions and Methods of Treatment. The addition of NMDA receptor antagonists with pending patent protection is highly focused on the potential improvement of neurological conditions including traumatic brain injury, other neurological deficits, addiction as well as other psychological conditions.

Earlier in the summer, the firm filed a new provisional patent application with the US Patent and Trademark Office entitled ‘Psilocybin and Norbaeocystin Compositions and Methods of Treatment’, containing 67 new inventive claims. PsyBio’s portfolio now includes five pending provisional patents and one pending non-provisional patent application.

In June 2021, PsyBio started to manufacture proprietary biosynthetic psychedelic compounds in Europe. The initial pilot-scale batch manufacturing run is the Florida-based company’s first in the continent. PsyBio is working with France’s Biose Industrie, which commercializes pharmaceutical products based on live bacterial production, to help prepare the products and substances for regulatory evaluation.

PsyBio closed its first quarter 2021 with nearly C$13 million in cash and equivalents on hand. Its shares recently began trading on the OTCQB Venture Market in the US.

Inflection points:

• Rapid proprietary biosynthetic formulation of psilocybin in collaboration with Albany Molecular Research (NASDAQ:AMR)
• Filing an IND on psilocybin by the end of the year, and filing on at least one optimized variation the following year
• Multiple shots on goal through optimization techniques

What the broker says:

Noble Capital has initiated coverage on PsyBio with an Outperform rating and a price target of $2 on the stock.

Analysts cited the company’s pathway to clinical development as a driving force behind the stock, noting the firm’s proprietary manufacturing process for making psilocybin as one of its strengths.

“The company can produce large quantities of these compounds at pharmaceutical specifications for potency, stability, and purity. This reduces the variability and cost compared with other methods. Its patent portfolio covers its biological manufacturing processes and the methods of use for combination therapies,” the Noble analysts wrote.

According to the analysts, the US Food & Drug Administration (FDA) and government regulators are now recognizing the potential for psychedelic drugs to treat mental illness, which they said gives “new credibility to the field” as well as increased investor attention.

“We value the company based its proprietary manufacturing technology, the potential uses for the indications in development, and comparative valuations of other companies developing psychedelics for psychiatric indications,” the Noble analysts concluded.

What the boss says:

In a recent interview with Proactive, PsyBio co-founder and CEO Evan Levine said: “PsyBio works in collaboration with the engineering and psychology departments at Miami University. The engineering team works on new discovery and strain and pathway optimization, the psychology department runs the experimentation through animal models.”

“We believe we are one of the first researching teams designing drugs based on these metabolic interactions and we have multiple patents that we have filed based on our inventions. We have an exciting year ahead and will enjoy a tremendous amount of data to share with the community,” he added.

Contact Angela at [email protected]

Follow her on Twitter @AHarmantas

Story by ProactiveInvestors