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Remember when psychedelics were like all the raid.
Totally and then they talked to you about them for a while.
And then they weren't because in twenty twenty two we saw prices collapse, money was pulling out, trial results weren't where they needed to be. It's having a resurgence. According to Bloomberg Intelligence analysts, they're estimating that the psychedelic drug market could go to seven billion dollars twenty thirty two.
That's a decent market.
Yeah, yeah, So the market potential here, they say, is clear, but companies could still run into issues with regulators. This we know and in upscaling the products. So back with us here in studio, which we're so happy about, is Kabeir Nath, chief executive officer of Compass Pathways, and so great to have you back. You were here last in July.
Kaber, that's right, and it's great to be back. Thanks for the invitation.
So tell us first off, just a little background for folks. This is a your company, Compass Pathways, five hundred and fifteen million dollar market cap, not too shabby. Stock is up forty two percent year to date. We know there's a lot of volatility in this industry too, but that's not too shabby either. Tell us what's changed since you were in our studios in July.
Thank you. So we're excited about the fact that we're now in a position to potentially accelerate getting this medicine to patients who so urgently needed. Let me remind you that there are three million patients living with persistent depression in the US. Fewer than five percent of them today are treated with a medicine that was actually specifically studied for or is approved for treatment resistant depression. And this is depression that is chronic, it's refactory. Often people are
unable to work. It has dramatic direct healthcare costs in terms of costs of emergency room admissions in psychiatric care, but it also has real social costs for these people. So what's changed is we've had a really excellent conversation with the FDA about their desire to see subject to us to continuing to produce really strong results in terms of efficacy and safety. Their desire to see this moved
more quickly. We've completed the enrollment and our second final stage study, which we did ahead of expectations, which is really down to the phase three. This is a phase three. This is the second of our final stage studies. We've completed the enrollment of that. We expect to have the primary data from that in first quarter of next year. That will give us the second of our final stage studies.
And with that we are actually excited to be able to submit that to the agency and look to an accelerated approval.
Wow, that sounds like a really big move. I'm curious.
Just remind us, and we were talking with our healthcare team, how you guys designed the trials or research program to avoid some of the pitfalls that we've seen with I think about the ecstasy and the mm MDMA drug application theF that was for PTSD.
How did you guys avoid some of those pitfalls.
So first, we had the opportunity to learn from some of the lessons. We've been in an excellent dialogue with the FDA now for some six or seven years since the first start of this, Since this process, Yeah, as we know, drug developing new medicines takes a long time. On a lot of commitment. We've done this in a very robust and rigorous way. We are collecting full side
effect data. We're collecting all the issues, not just your potential side effects such as headache and fatigue, which are transient, but also things like liking and so on, to make sure that there is really no abuse potential for this, and we've been collecting that right from them.
Is there any abuse potential for this?
There is no history in psilocybin of people actually seeking it out or of any abuse potential with psilocybin, which is an important point.
I'm putting my investor hat on for a moment, and I need to ask you about intellectual property and how you handle something like that, because psychedelic compounds don't sort of fit comfortably into that compound if you will, because a lot of them are natural, they can't really be patented if you will, So how do you deal with that? And to what extent is your medicine you know, hold patents or have intellectual property.
So our medicine comp three sixty is a fully synthetic formulation of psilocybin. Okay, we have polypomorph patents that address that, and therefore we have robust protection till twenty thirty eight, with the potential for extension around that, because again we went for a fully synthetic modern medicine.
Have you talked directly with the Health and Human Secretary Secretary Robert F. Kennedy.
We are focused on an excellent relationship with the Psychiatry division of the FDA. Okay, we've been working with the same folks for seven years now, yeh.
I have certainly made some commentary around this that has given, you know, hopes and expectations that this would move along more rapidly.
We're happy that there are senior figures in the administration who believe like us in the potential for psychedelic therapy. But we're really focused on delivering the right efficacy and safety through our studies and working directly with the division that's going to approve.
Us SO trial three phase next year. Early next year, give us an idea of a timeline, I mean, when might we see something like this come to market.
We will get the primary data, as I said, in first quarter of next year. We will need to submit some more data later in the year, but we are looking forward to being in a position to complete a submission to the FDA in the latter part of next year, and then we'll work with them as expeditionally as possible and a potential regulatory approval.
So twenty six, twenty twenty seven, Like, what's I know, this stuff all takes long, and I know we consante am asking you, but I think because it's been so much out there for a while, a decade and then some right, I think we're all trying to do, certainly for an investing audience, understand when this actually hits the market.
We are preparing to be ready for a commercial launch from the end of twenty twenty six.
Ah, he said it, Well, thank you.
What is something like this? What is something like this cost?
That's the question.
So it's premature to discuss the pricing for this in the moment. First, we actually still need to see some of the longer term results from our studies. In particular, we need to see over the course of the first six months what the potential for a second dose is and really therefore how many potential sessions that a patient may need to have in a given year.
That's a great question. You're talking sessions. So this is not a drug that someone would continue to take or a lifelong sort of drug if you will.
Absolutely, and it's a really important point there. What we have shown in our studies so far is that a single session can produce a dramatic response that lasts for six weeks today, either it's a daily oral or there is a product esketomine, which you will need to take maybe thirty to fifty times a year. What we are showing is truly transformative therefore for these patients with this infrequent session.
So we're talking with Kabir Notath. He's chief executive officer of Compass Pathways. Ticker is CMPs. He's here in our Bloomberg studio, Bloomberg Headquarters. Kabir, one of the things I think about then is if all goes as you anticipate, and you've talked about the market for like who this is for specifically, then do you move on to other uses and other treatments, whether it's PTSD, whether it's drug addiction, Like I'm just curious how far you can go with this.
Yes, thank you, Carol, And we are designing, have in fact already designed and finalized the design of a study in PTSD. PTSD affects thirteen million people in America. And while there's this view that it's prevalent among veterans and so on, it absolutely is that's actually only around fifteen percent of that population.
Only fifteen percent.
Fifteen percent, actually sixty percent of people suffering with PTSD are women, and so this is a very large population. The only two drugs medicines approved for PTSD were approved in the last century, so this is something new, different, and so we are very excited about that we have designed a study and that we will be kicking that off.
I want to go back to the question of price. So what about insurance and how does that play a part in all of this.
From the get go, Compass was set up in order to ensure broad and equitable access for patients, and that means the ability to work with insurers, both commercial and government. With the data we've already shown, as I say, a single administration producing statistically significant result of reductions in depressive symptoms after six weeks, we've already started to demonstrate the
value that this can bring to the healthcare system. Patients living with persistent depression frequently end up in the emergency room. They sometimes have in patient's psychiatric care. There are direct costs to healthcare systems, and we have already started to demonstrate the value.
You know, and forgive us, Kamir, we do you keep going back to I know you can't talk about price or your guys A just figuring that out. But we kicked off saying, according to our Bloomberg intelligence team that this market psychedelic drug development could go to seven billion dollars in sales by twenty thirty two.
How much of that do you.
Think is or how much of that market size do you think you could get?
And I'm just trying to I'm curious.
So we have the potential to be ahead of other companies in this market by two to three years, and we're excited about the opportunity to treat lots of patients. So for us, this is about the ability to make inroads into those three million patients that need a new
treatment option. The only medicine that's actually approved and is being really promoted for this population today is treating maybe seventy to one hundred thousand patients, so that that population of three million, right, So what we're excited about is the ability to bring this new medicine to those patients.
Is it a billion dollar dug drug. Would you anticipate We would.
Hope that if we can successfully treat, if we can treat a large number of.
Patients, especially if you get and you expand out, do you go for other uses?
Yeah?
Do you go alone?
That's our intention. We've always said clearly that we believe that we can do this on our own in the US market, and that's our intention.
All right, what about side effects? I mean, folks are listening to this, A lot of folks are hoping that this is all going to work and come to market sooner rather than later. What are some of the side effects though?
So on the day of dosing, there's some headache, some nausea, and that passes by the second day at most, because this is a day in a treatment center. We have a fully independent group of scientists and clinicians that reviews all our safety data on a regular basis. They have access to data from all arms of our studies and they have seen no unexpected or concerning side effects that have caused them to alter the course of the study in any way.
And just remind everybody, and we just got about forty seconds co here, right.
When it is given to a patient, there are folks around to really watch the process, make sure things go.
You're not taking this into your bathroom by yourself.
This is very much delivered in a safe environment, in a medical environment, with somebody in the room who is medically trained, who's there just to a sure patient safety and comfort.
Do you see the finish line?
I absolutely do. We're excited about that potential.
I just think how long we've been reporting on it and talking about it. It's really fun to kind of be on this journey.
I'm just with you.
I'm just wondering quickly regulatory hurdles in twenty twenty six. Do you think that it's going to be a more friendly regulatory environment.
With the Psychiatry Division. We have an excellent relationship and that's been consistent over six seven years and we expat.
Yeah, it sounds like you've been talking to them for a long long time. Kabir, thank you, Nice to have you in studio.
Kabir not his chief executive officer of Compass Pathways, joining us right here,