Traditional psychedelics are far from new compounds. Albert Hofmann discovered LSD in 1938, though its psychoactive properties weren’t fully understood until more than a decade later, ketamine has been around since the 1960s, and of course plant-based psychedelics have been used in traditional medicine for centuries.

Even when created in laboratories, these are typically pretty simple drugs. They interact with serotonin receptors in certain ways, create certain effects in the patient’s brain, and can be used to treat certain conditions as a result. But they aren’t tightly targeted or controlled.

That’s the problem that Bright Minds Bio, a company out of Toronto, is looking to solve, developing what it calls the next generation of psychedelics with a focus on treating depression and other mental health disorders. Founded in 2017, Bright Minds is dedicated to creating psychedelics that are tightly targeted to specific therapies and come with minimal side effects, with its research team working to optimize psilocybin cultivation to improve quality and yield while also creating more consistent end products.

The opportunity here is huge, with the market for antidepressant drugs topping $13.6 billion in in 2018, on track to reach nearly $16 billion by 2025. In the U.S. alone, a 2014 survey found that more than 15.7 million adults were affected by depression, a figure that has been climbing steadily for decades. It’s no surprise that more than $160 billion is spent each year on psychiatric treatments in the U.S.

But drug development in the area has leveled off. The last major group of antidepressants, SNRI’s and SSRIs like Prozac, are now 25 years old, and come with unwanted side effects like weight gain, sexual issues and loss of personality.

The time has come for a new class of drugs to treat depression, anxiety and other mental health issues and Bright Minds believes that psychedelics are the answer. We recently sat down with Ian McDonald, the company’s CEO, to learn more about the technology they’re working on and where they see the future coming for psychedelic medicines.

Psychedelic Invest: Let’s start from the top with what Bright Minds is all about and what you’re working on.

Ian McDonald: So, Bright Minds is a biotechnology company focused on creating the next generation of psychedelic medicine, drugs that will be new and improved versions of classic psychedelics like LSD or psilocybin.

PI: How new is this work? LSD is now more than 70 years old, but has research like this been going on the whole time or is it just happening now that legalization is starting to open up?

IM: Well, here’s the issue. In the era when LSD was discovered and characterized, the technology of the day wasn’t to the level of what’s available today. So, they didn’t know what different serotonin receptor sites it hit. All they knew was that it hits these things called serotonin receptors. The different serotonin subtypes weren’t actually characterized until the 1990s. So those drugs are very blunt instruments, and what we are creating are more targeted therapies. And as far as we know, we’re really the leaders in this field right now.

PI: What’s your background coming into this industry?

IM: My background is in investment banking, so I’ve been involved with starting and forming companies in various industries. But Bright Minds has been my focus for the last few years.

PI: And your scientific team?

IM: They’re brilliant researchers. They are hardcore drug developers who have spent pretty much their entire careers in drug discovery. Dr. Gideon Shapiro, one of our co-founders, actually worked at Sandoz in the same building where Albert Hofmann discovered LSD in the 1930s. He was working in the central nervous system (CNS) department there and actually went on to run the department, which is responsible for their entire ergot collection of brain drugs. [Ergots, or ergoline-based compounds, are psychedelic substances that are similar to alkaloids and include synthetics like LSD as well as naturally occurring compounds like ergine.] He later spent seven years at Rugen Therapeutics creating superior versions of ketamine.

Beyond Gideon, one of our other scientific co-founders, Dr. Alan Kozikowski, studied at Berkeley and Harvard and then went on to be a leading academic brain drug researcher. He’s had several drugs come to market for different elements and has done a lot of work with psychoactive drugs like cocaine and PCP and is one of the leaders in terms of understanding various serotonin receptors.

Also, our chief medical officer has spent decades developing drugs, as well as a team of 10 more people who all bring different scientific capabilities and expertise to the table.

PI: Focusing on depression and the drugs that are out there right now, millions and millions of people take these drugs. I know there are shortcomings, but what can psychedelics do better than traditional medicine for depression?

IM: SSRIs are, again, pretty blunt instruments. They flood the brain with serotonin, of which there are various subtypes, so you have serotonin 1A receptors, 2B, 2C and the list goes on. And each of those various serotonin receptors do different things. Some of them are antidepressants, others work on different mechanisms. 2A is the psychedelic receptor.

The serotonin 2B receptor site, for example, is quite prominent in the heart. Activating that serotonin 2B receptor site leads to cardiac issues, so that’s one you don’t want to hit. But unfortunately for first generation drugs like psilocybin and LSD they hit the 2A receptor, which is the one you want, and the 2B receptor with equal activity so that’s a potential negative that we’re working to solve for. And that’s just one example.

Some of the issues with SSRIs, which are the standard first line therapy for depression, would be sexual dysfunction, weight gain, loss of personality, etc. Another major issue is that SSRIs often take weeks to kick in for a patient. That onset is a major issue, especially when you’re dealing with people facing suicide.

With psychedelics it’s not a pill a day. You’re completely changing the treatment paradigm whereby you take one psychedelic session and it benefits some faulty circuiting in your brain and you are better for a period of weeks. It’s pretty much instantaneous in terms of its antidepressant effect.

PI: Better for a period of weeks. But can the right dose make you better forever if it resets the brain in the right way?

IM: We don’t believe that it will, but the short answer is that every patient’s going to be different.

If you look at ketamine, for example, researchers originally thought that it worked as a brain reset. It was thought to be a very long lasting drug. But the further they got into it and the more people they had in their trials it became apparent that dosing would need to be more frequent in order to achieve the results they were looking for.

We expect the same thing to happen for psilocybin. Maybe there are one or two patients out there who will take a course of treatment and be better forever, but typically with faulty circuit disorders your brain will sort of revert back to the disease state after a while. It’s going to be very patient dependent. Some patients may be good for a couple of months while others will see the effects last for maybe a week or a couple of weeks.

PI: You’re a banker, let’s talk about the market for this technology. Biotech in general often has very long development times to get drugs to market and seems like we’re still fairly early in the process for psychedelics.

IM: That’s true. This is an area that major pharma is keeping a very close eye on and they’re sort of sitting on the sidelines right now, waiting to pick their horse and figure out what drugs have the best shot at becoming major medicines. I think it’s only a matter of time before there’s a major partnership deal and acquisitions from big pharma start coming through. We’re already seeing interest from major pharma companies in our compounds.

So, it’s early days, looking at second-generation compounds I’d say we’re probably in the lead. Our time to market would be five years from now best case.

For more information about Bright Minds and its ongoing work developing psychedelic antidepressant compounds, visit For market price data, visit our Index.