Post-COVID Investment Mega-Opportunity: Mental Health and Psychedelic Drug Stocks

Interested in investing in a healthcare sector targeting a pandemic ten times as large as COVID-19, with next-generation Miracle Drugs that are nearly ready to start hitting the market?

For the past 18 months, investor focus on healthcare has almost been exclusively confined to the development of COVID-19 vaccines. Consequently, a much larger investment opportunity in healthcare has been almost completely ignored.

More on this later.

Global health trends seem to indicate that the COVID-19 pandemic is receding, even as COVID “mutations” are causing significant concerns in some regions. Incremental infections and fatalities are decreasing in most parts of the world at the same time that vaccination rates ramp upward.

Now it’s time for nations around the world to deal with the scars of the COVID-19 pandemic. Mental health scars. A recent Wall Street Journal article summarizes the current, grave scenario.
 

The Mental Health Pandemic: the world’s largest pandemic

As of this date, roughly 186 million people globally have been diagnosed with COVID-19 infections – a little over 2% of the global population. With those infections has come just over 4 million COVID-19 fatalities. That equates to 0.05% of the global population.

Even in jurisdictions with epidemic levels of infections, most fatality rates are not significantly higher than for any of the severe flu strains (to which we are regularly exposed).

Everyone is glad that actual COVID-19 infections and fatalities have numbered far below all worst-case scenarios. But the oppressive COVID-19 lockdowns that governments imposed to fight this pandemic have come with a very heavy cost.

Massive numbers of workers displaced. Huge numbers of small businesses bankrupted. Equally tragic is the enormous toll on mental health caused by these lockdowns.

Even before the world ever heard of “COVID-19”, the Mental Health Crisis was a larger pandemic than this novel coronavirus. Well over 1 billion people were afflicted by stress-related disorders like depression, anxiety, addiction and PTSD.

These numbers have soared due to the enormous additional stresses associated with COVID-19 lockdowns. A previous Psychedelic Stock Watch article examined this rapid acceleration in the Mental Health Crisis.
 

• Overall, the percentage of Americans suffering from depression had already more-than-tripled by September 2020, from 8.5% to 27.8% (91.75 million Americans) [source: Boston University]
• Rates of “moderately severe depression” among Americans have quadrupled (from 2% to 8%) and rates of “severe depression” have more than quintupled (from less than 1% to 5%) [source: WebMD]
• The depression/anxiety pandemic continues to worsen: between August 2020 and January 2021, the percentage of Americans experiencing anxiety or depression jumped from 36% to 42% [source: CDC]

• As of August 2020, sales of alcohol in the U.S. had risen by 27%, along with a 32% increase in non-prescribed fentanyl, 20% increase in methamphetamines, 12.5% increase in heroin, and 10% increase in cocaine, leading to an 18% increase in drug overdoses [source: EHS Today]
• By June 2020 (only 3 months after the start of the pandemic in the U.S.), more than 1 in 8 Americans (13%) had either started or increased their use of recreational drugs due to COVID-related stress [source: CDC]
• By June 2020, U.S. drug overdose deaths had reached their highest level ever, 81,000 overdose deaths from June 2019 to June 2020 [source: Statnews]

Compounding this crisis in the United States is the mental health catastrophe within the U.S. military. Recent U.S. wars have exacted a devastating toll on the mental health of military personnel.

Double-digit percentages of veterans of U.S. wars from the invasion of Iraq all the way back to Vietnam currently suffer from Post-Traumatic Stress Disorder (PTSD). Tens of thousands of these veterans are partially or completely disabled from their condition.

And PTSD (unlike COVID-19) also leads to a high rate of fatalities.

Since the start of the COVID-19 pandemic, over 300,000 Department of Defense personnel have been diagnosed with COVID-19. But total COVID-related fatalities remain well below 200 personnel.

Over this same period of time, roughly 1,200 DoD personnel have committed suicide due to mental health disorders – primarily PTSD. More than 6 veteran suicides for each COVID-19 death. An average of 22 veterans commits suicide every day.

The Mental Health Pandemic has always been worse than COVID-19

Thanks to the dramatic escalation in mental health disorders from COVID lockdowns, somewhere between 1.5 billion and 2 billion people now suffer from a stress-related mental health disorder.

That’s roughly 10 mental health disorders per COVID-19 infection.

Over 90% of those infected with COVID-19 have been cured. The much larger numbers for mental disorders are current sufferers.

Governments around the world have engaged in an obsessive push to develop and distribute COVID-19 vaccines. The same governments have done nothing with respect to our mental health – except make it much, much worse.

A complete lack of proportionality on the part of our governments and healthcare systems. With as many as 1 in 4 people now suffering from one or more mental health disorders, it will be extremely difficult for our myopic governments to continue to ignore the Mental Health Pandemic.

U.S. employers lament about a “labor shortage” for the vast numbers of near-minimum wage jobs currently available. Those jobs would probably have already been filled if ~50 million employable Americans weren’t currently suffering from some form of mental health disorder.

In claiming to “protect our lives”, governments have destroyed our quality of life. A Mental Health Pandemic is the obvious result.

The U.S. government can continue to ignore mental health – and pay 10s of millions of Americans not to work. Or, the government could attempt to ensure that the U.S. economy has enough employable workers to fill current job vacancies, by (belatedly) addressing the massive crisis in mental health within the United States.

But it can’t do this with existing mental health therapies. The healthcare sector (and pharmaceutical industry) has utterly failed in providing even an adequate standard of care for mental health disorders.
 

• Only ½ of those suffering from depression obtain any benefit from “first-line drugs”.
• Only 1/3rd of U.S. veterans receiving treatment for PTSD from the Department of Veterans Affairs obtain any benefit from their therapy.
• Current treatments for the 1+ billion people with substance abuse disorders are simply a joke – a bad joke. Tobacco companies cynically invest in “smoking cessation” products because of their abysmally low rate of success.

Psychedelic drugs are the obvious (and only) solution to the Mental Health Pandemic

The good news is that there are a class of drugs that have already demonstrated (in formal, clinical studies) that they can dramatically raise the standard of care for depression, anxiety, addiction and PTSD: psychedelic drugs.
 

The bad news is that most of these drugs are currently illegal – thanks to the anti-drug phobias of Western governments.

These mental health Miracle Drugs remain unavailable for most of the millions (billions?) who need them. Yet a current Phase III trial for an MDMA-assisted therapy for PTSD is producing significant benefits for nearly 90% of study participants.

Two-thirds of participants “no longer qualify for a PTSD diagnosis” – i.e. they were cured.

If this therapy was available to U.S. veterans today, the DoD’s horrific rate of veteran suicides could be reduced to a small fraction of the current total.

The catastrophe with other mental health disorders may not generate as many fatalities as PTSD, but is every bit as much of a crisis. Mental health disorders are the leading overall cause of permanent disability.

The U.S. military may literally be incapable of fighting another major war unless/until it addresses its Mental Health Crisis. U.S. employers may continue to grapple with a “labor shortage” unless/until more (otherwise) employable workers have their mental health issues properly addressed.

Governments better hope that their COVID-19 containment policies have produced a solution to the COVID-19 pandemic. Because the Mental Health Pandemic already threatens to derail the global economy.

A further explosion of lockdown-related mental health disorders could cause our economies – and societies – to simply unravel. Let’s repeat the numbers, so they sink in.

Less than 3% of the global population have been infected with COVID-19, and over 90% of those people are cured.

Somewhere between 15% and 25% of the global population currently suffer from one or more mental health disorders, which for some groups generate a mortality rate more than six times higher than COVID-19.

The “operation” to contain COVID-19 can be darkly summarized with an old joke.

To address a crisis relating to a virus with a low fatality-rate, governments have created a mental health catastrophe. Now they must address that catastrophe.

Psychedelic stocks: positioned to drive a healthcare Revolution

Miracle Drugs. Revolutionary mental health therapies.

How do investors access this enormous opportunity in life sciences? Psychedelic drug stocks.

A small-but-growing collection of well-capitalized public companies are driving this Revolution in mental health care. Psychedelic Stock Watch has previously outlined the commercial potential for the next-generation psychedelic drugs currently working their way through formal clinical drug trials.

We have also identified some of the early leaders in psychedelic drug development among public companies.

There are also investment opportunities in the mental health clinics that will be required to deliver these healthcare services to the vast numbers requiring treatment. Psychedelic Stock Watch has laid out the parameters here for investors.
 

Crisis = opportunity

A Mental Health Crisis has become a pandemic due to government neglect/apathy. Potent drugs that can revolutionize mental health care have been not only banned from use but even cut off from research for decades.

Now these drugs are being fast-tracked to address this mental health pandemic – and the countless millions in desperate need of these mental health therapies. The FDA has granted Breakthrough Therapy Designation (expediting drug development) for both Compass Pathways’ (US:CMPS) Phase IIb clinical trial of a psilocybin-based therapy for depression and a Phase III clinical trial from MAPS for an MDMA-assisted treatment for PTSD.

Put all this together and it translates into explosive commercial potential for the psychedelic drug industry, not just for years but for decades to come.

Mental health disorders now dominate (and overwhelm) the healthcare industry. Providing solutions for this massive, neglected pandemic translates into enormous profit potential for investors.