NEO CEO: Psychedelics an "Incredible Opportunity" to Do Good

TL;DR

CEO of the NEO Exchange, Josh Smith, discusses the growth and potential of the psychedelics industry, highlighting its focus on medical treatments rather than recreational use.

Transcript

for the investing news network i am brian mcgovern i'm here today with josh smith the ceo of the neo exchange in canada jos thank you so much for your time pleasure to be with you josh before we begin talking about psychedelics and the industry as it stands right now i want to acknowledge first of all i hope you're doing safe here and your family a... Read More

Key Insights

• 💦 Remote work technology has enabled the NEO Exchange to operate successfully during the pandemic, highlighting the adaptability of the stock exchange.
• 😷 The psychedelics industry presents an opportunity to address prevalent mental health issues, such as addiction, depression, and PTSD, through the development of medical drugs.
• 😷 Differentiating between companies focused on medical treatments and those emphasizing recreational activities is crucial for investors.
• 🪚 Institutional investors' entry into the psychedelics industry can contribute to stability and lessen extreme volatility.
• 🔒 Securities regulators are becoming more vigilant in addressing fraudulent companies, giving investors more confidence in the industry.
• 🥺 Long-term investments in psychedelics can lead to impactful outcomes for society and potentially provide good returns for investors.
• 🤗 The NEO Exchange's commitment to opening up capital markets for innovative solutions, like psychedelics-inspired biotech companies, highlights their dedication to doing what is right for society.
• 🙈 Ontario government task forces are working to modernize capital markets, addressing issues and misbehaviors seen in listings.

Questions & Answers

Q: How do investors differentiate between development of medical treatments and recreational activities in the psychedelics industry?

The key distinction lies in the focus of companies on clinical trials, research collaborations with universities, and adherence to regulations. Serious companies prioritize medical treatments, while recreational activities are not the main objective.

Q: Are there concerns about fraudulent companies in the psychedelics industry, similar to what was seen in the cannabis industry?

Yes, the industry is not immune to fraudulent activities, but securities regulators are becoming more active in identifying and addressing these issues. Investors should take the time to analyze companies, their processes, and regulatory compliance to avoid investment pitfalls.

Q: Will psychedelics experience extreme volatility in the stock market like cannabis, or will it follow a more steady pace like pharmaceuticals and biotech industries?

The level of volatility will depend on institutional investors' involvement. As institutional investors focus on long-term solutions and higher stability, their entry into the psychedelics industry can mitigate extreme volatility. Additionally, the legal certainty surrounding psychedelics contributes to increased institutional interest and stability.

Q: Can we expect more listings in the psychedelics industry in the remainder of 2020?

Further listings are anticipated, especially from serious companies aiming to address mental health issues. The capital-intensive nature of the industry and the extended timeline for developing drugs make going public a viable option to secure the necessary funds for the process.

Summary & Key Takeaways

• Despite the challenges posed by the pandemic, the NEO Exchange is operating successfully with remote work technology, showing the potential of the stock exchange to adapt to changing circumstances.

• Smith first became aware of the psychedelics industry about a year ago when discussing the IPO of MindMed, which focuses on psychedelics-inspired biotech solutions for mental health issues.

• The stigma attached to psychedelics is still present, but by understanding the medical potential and the involvement of serious companies in clinical trials and research, investors can see the opportunity.