Psilocybin, the psychoactive component of so-called magic mushrooms, has long been known to science. But only recently this and similar active ingredients have come back into the focus of research, which meanwhile has high hopes that so-called psychedelic drugs could be successful in the treatment of disorders such as depression where common psychopharmaceuticals “fail” .
The US health authority FDA has also recognized the potential of psychedelics and granted psilocybin research the status of “Breakthrough Therapy” in two cases, which should enable faster research, development and treatment of ailments for which conventional psychopharmaceuticals are not effective. One of the companies whose research received this status was Compass Pathways – the company’s price on the Nasdaq has since shot up from around USD 35 to a high of just over USD 60!
The company that we are drawing our readers’ attention to today is still at the beginning of its development, but we believe that Nova Mentis Life Science (CSE NOVA / WKN A2P7XA) also has the chance of a spectacular development!
Focus on the autism spectrum
While Compass and other companies are primarily dedicated to researching the effect of psilocybin on depressive disorders, Nova Mentis (via the recently acquired, wholly-owned subsidiary Pilz Bioscience) is researching the treatment potential of psilocybin (and other, similar active ingredients) in relation to the so-called Autism Spectrum (ASD).
This is a worthwhile field because, according to the CDC (Centers for Disease Control and Prevention), ASD has been identified in around one in 54 children – and that in all ethnic and socio-economic groups. In the US alone, it is estimated that the market for autism therapies was worth USD 3.2 billion in 2018 and is expected to reach USD 4.6 billion in 2026. A Canadian study also estimated the total cost of ASD treatment to be CAD 1.2 to 4.7 million per individual, depending on the severity of symptoms and disability. A possibly cheaper and above all more effective treatment would not only be a blessing for those affected, but could also mean a breakthrough for a young company like Nova Mentis!
Psilocybin source secured
Nova Mentis has already signed a production agreement with a well-known US drug manufacturer with expertise in the production of active pharmaceutical ingredients (API). These drugs, which are manufactured in accordance with the GMP standard, are used in the ongoing, preclinical studies with which the “proof of concept”, i.e. the proof of feasibility, is to be provided in the studies on the autism spectrum. The active ingredient from this source will also be used in the later planned human clinical studies.
The availability of more than 95% pure, synthetic psilocybins as well as baeocystins and aeruginascins will allow Nova Mentis to develop unique combinations of active ingredients that could have potential therapeutic applications for various forms of ASD. (In addition, Nova plans to develop unique combinations of these psychedelic drugs to treat other debilitating, chronic diseases such as irritable bowel syndrome, colitis, and liver disease. But that is not the case for now.)
Important advances on initial ASD studies
Nova Mentis has developed what it claims to be a unique, proprietary system for diagnosing and treating the spectrum of autism, within the framework of which initial studies are already being carried out with regard to psilocybin-based therapies. As recently as December last year, the company succeeded in detecting molecular and bacteriological markers in a recently completed preclinical model study on ASD. These allow Nova Mentis to differentiate between different versions of the spectrum and to develop appropriate recipes. The data from the current, pre-clinical ASD program will be used, among other things, to determine the dosages for tests on humans as part of planned pharmacokinetic and clinical phase 1 studies – an important milestone!
Incidentally, the markers mentioned are an important unique selling point of Nova, as they allow an objective validation of the results of subjective behavioral tests in the psychedelics industry, according to the company. The company aims to provide world-class therapies and diagnostics by bringing biochemistry and cognition together in one clinical setting. Nova Minerals is planning nothing less than a revolution in ASD diagnostics and treatment by integrating the physical and mental health of the patient!
And these objective diagnostic tools could also be used outside of the use of psilocybin in the brain and the treatment of ASD. Nova’s scientific premise is that the causes that can trigger autism include similar factors that trigger other diseases in humans, including genetic factors, environmental chemicals, infections, neuroinflammation, immune system dysfunction, and changes in the microbiome. At a later date, Nova Mentis will also turn to numerous other therapeutic indications with great commercial potential – including ASD, diabetes, obesity and non-alcoholic steatohepatitis (fatty liver hepatitis). So there are many possible areas of application!
But first, as I said, the company will focus on treating ASD. To this end, a preclinical model of autism was created using valproic acid, which mimics human ASD. In doing so, Nova Mentis discovered the aforementioned molecular and bacteriological diagnostic markers, which are used to detect behaviors in the ASD animals being treated with the company’s psilocybin drug – and this study is scheduled to begin this month!
Strong scientific team
For these demanding tasks, Nova Mentis has put together a scientific team that has experience in the most diverse facets of drug discovery, drug development, the approval process and operation within leading biotech and pharmaceutical companies:
First and foremost, Dr. Marvin S. Hausman, who serves as chairman of the scientific advisory board. Dr. Hausman has more than 30 years of experience in drug research and development at pharmaceutical companies such as Bristol-Meyers International, Mead-Johnson Pharmaceutical, E.R. Squibb and Medco Research. He has also been researching mushrooms and their medicinal benefits for more than a decade.
He is supported by Dr. Kyle H. Ambert, who is currently the Director of Data Science at Nike and has extensive experience in data analysis, machine learning, artificial intelligence and applied analytics. Dr. Ambert is a doctor of biomedical informatics. Dr. Julia Perederiy, on the other hand, is the company’s chief scientist and strategic advisor and has researched the neurogenetics of autism. Last but not least, the valproic acid-based study on rats was carried out in collaboration with Dr. Viviana Trezza, conducted by Roma Tre University in Italy.
In addition, Nova Mentis has already entered into an agreement with the experts at Comac Medical, which provides that the Comac Nova will assist in the design and implementation of pharmacokinetic and clinical phase 1 studies as well as the submission of documents for approval in the EU.
Nova Mentis is active in an extremely exciting field, research into medical psychedelics, which is currently attracting increased attention from investors. After the FDA awarded the status of “Breakthrough Therapy” for psilocybin studies twice last year, the sector is “hot”. We consider the prospect that the company’s future psychedelic drugs could treat expressions of the autism spectrum as extremely promising, among other things because this is a widespread disease and therefore has corresponding market potential.
We believe that if Nova Mentis continues to report the success of its research, it may well attract a wider range of investors. As stated, the company has some advantages over comparable companies, including the fact that it has the so-called Drug Master File (DMF), which is required, for example, for filing with the authorities before the start of clinical studies on humans. The DMF adds value to a drug development protocol and an Investigational New Drug Application (IND) for testing in humans, which is submitted to the relevant authorities in the USA, Canada and Europe, among others.
Nova Mentis has only 111,137,867 shares outstanding undiluted and thus has a market capitalization of just CAD 26.12 million at the current price of CAD 0.235. This puts you well behind competitors such as Revive Therapeautics, Numinus, Havn or Mind Cure. Competitor Mind Medicine has already achieved a market capitalization of CAD 1.6 billion – albeit three studies are already in the clinical phase.
We think that in time Nova Mentis could definitely take a path like MindMed, even if there is still a long way to go and the risks are high. Still we see Nova Mentis (CSE NOVA / WKN A2P7XA) look extremely promising and will keep a close eye on the company.
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In accordance with Section 34b WpHG and Section 48f Paragraph 5 BörseG (Austria), we would like to point out that partners, authors and / or employees of GOLDINVEST Consulting GmbH can hold shares in Nova Mentis Life Sciences and thus a conflict of interest could exist. Furthermore, we cannot rule out that other stock market letters, media or research firms will discuss the values we have discussed during the same period. Therefore, symmetrical information and opinion generation can occur during this period. Furthermore, there is a consulting or other service contract between GOLDINVEST Consulting GmbH and a third party in the issuer’s warehouse (Nova Mentis Life Sciences), which creates a conflict of interest, especially since this third party is GOLDINVEST Consulting GmbH for a fee for reporting paid to Nova Mentis Life Sciences. This third party can also hold, sell or buy shares in the issuer and would thus benefit from an increase in the price and trading volume in the shares of Nova Mentis Life Sciences. This is another conflict of interest.
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