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Filament Health: A Top Stock for Your Psychedelic Portfolio!

Filament Health

Companies part of the psychedelic market are poised for exponential growth in the upcoming decade. These companies are part of a rapidly expanding addressable market that is estimated to touch $.75 billion by 2027, up from $4.75 billion in 2020, indicating a compound annual growth rate of 12.36% between 2021 and 2027. One stock that should be on your radar right now is Filament Health, a micro-cap company with a market cap of $59 million.

An overview of Filament Health

Filament Health is a natural psychedelic drug development company. It aims to build a platform that supports the treatment of mental health conditions through FDA-approved psychedelic extracts from lab-grown and regeneratively harvested plants.

The company claims that more than 130 active clinical trials all around the globe have demonstrated psychedelics as a healthier and more effective alternative for mental health treatments which is valued at $280 billion in North America alone.

According to the company’s presentation, about 264 million people suffer from depression while 275 million have been diagnosed with anxiety all over the world. Further, another 21 million are grappling with addiction and substance abuse.

The annual spending for depression and anxiety treatments is well over $8 billion cumulatively, while the global opioid market is significantly higher at $26.4 billion, providing Filament Health enough opportunities to grow top-line growth.

Earlier this month, Filament Health disclosed it’s the first public company to be issued a patent by the Canadian Intellectual Property Office for the extraction and standardization of natural psilocybin and associated psychoactive compounds. This patent describes the technology required to transform variable psychedelic raw materials into pharma-grade standardized extracts.

The company’s CEO Benjamin Lightburn emphasized, “We are proud to lead the industry with this first issued natural extraction patent. This approval represents important progress in the development of our intellectual property. At Filament Health, we know that nature is a valuable source of medicine, but that certain technologies are necessary to bring natural products up to a pharmaceutical grade—most importantly, through standardization.”

Filament has managed to develop technologies allowing it to extract and standardize a stable dose of natural psilocybin. Comparatively, previously used methods that included natural extraction resulted in poor yields, stability, and repeatability. Filament has thus developed a quality product at a lower cost.

Recent Q2 results

Filament Health is yet to generate revenue but it ended the second quarter of 2021 with $7.8 million in cash after closing a private placement of $5 million. In Q2, it completed a public transaction and pre-IPO financing round to list on the NEO exchange. The proceeds of this issue will be used for clinical trials, research and development, working capital, and intellectual property initiatives.

Filament Health was also granted an industry-first patent from the Canadian Intellectual Property Office which is related to the extraction and standardization of natural psilocybin and associated psychoactive compounds. Its patent filings portfolio has expanded to over one dozen that cover extraction, purification, standardization, and delivery of active pharmaceutical ingredients.

The company has also received an amendment to its Health Canada Dealer’s License which allows for broad activities with all controlled natural psychedelic substances.

The verdict

Filament Health is well-positioned to lead this very nascent but high-growth market in Canada. As several countries might legalize psychedelic use for medical purposes, Filament Health should gain solid momentum if the company can leverage its patent portfolio to gain traction in this space, thereby creating long-term shareholder wealth.

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