Lucy Scientific Discovery Inc. (Nasdaq:LSDI), a Canadian firm that focuses on developing and manufacturing psychotropics-based medicines, had its initial public offering (IPO) today. The company had priced 1,875,000 common shares at a public offering price of $4.00 per share.
On its first day of trading, however, the stock dropped by 25.25%, reaching a closing price of $2.99, a decline of 25.25%.
While the company had hoped to raise approximately $7.5 million before accounting for expenses related to the offering, it ultimately generated $5.6 million.
A different type of psychedelic company
Lucy Scientific Discovery differs from other psychedelic companies in that it is a licensed manufacturer of controlled substances. It aims to bolster its presence in the growing psychotropics-based medicines industry with growing contract research, development and manufacturing offerings.
The company has permission to manufacture psilocybin, psilocin, N,N-DMT, mescaline, MDMA, LSD and 4-Bromo-2,5-Dimethoxybenzeneethanamine (2C-B). The latter compound is a novel psychedelic first synthesized by Alexander Shulgin in 1974.
The company has a 25,000-square-foot facility near Victoria, British Columbia, dedicated to R&D and large-scale production of biological raw materials, active pharmaceutical ingredients (APIs) and biopharmaceutical products.
2023 is a mixed bag thus far for psychedelic companies
Thus far, 2023 has been a mixed bag for public psychedelic companies. Compass Pathways (Nasdaq:CMPS) has seen its stock price jump 22.67% to $9.47 since the beginning of the
year. MindMed (Nasdaq:MNMD) shares are up about 50% to $3.79 in the same time frame. Conversely, Atai Life Sciences (Nasdaq:ATAI) has seen its shares dip almost 34% to $1.75.
In 2022, public companies in the psychedelic therapy sector faced difficulties. Compass Pathways and Atai Life Sciences both experienced a 66% decrease in stock prices, while Cybin, Numinus Wellness and Revive Therapeutics saw drops of over 70%. MindMed saw a 90% decrease in its share price and received a notice of potential delisting from the Nasdaq. The overall stock market in 2022 was down, with the Nasdaq Biotechnology Index falling 13%. The Dow Jones U.S. Pharmaceuticals Index, however, increased by 4%.
In the coming years, the FDA may approve 3,4-methylenedioxymethamphetamine (MDMA) for treating post-traumatic stress disorder (PTSD).
Although classic psychedelics, MDMA and ketamine are sometimes referred to as psychedelics.
The agency may also approve the tryptamine psilocybin for depression.