Could magic mushrooms be a life-changing therapy for people with anxiety? What about LSD? If you're an optimist, your answer might be "maybe," but if you're Mind Medicine, (NASDAQ:MNMD) it's an enthusiastic "yes." 

Mind Medicine is an exciting company at the forefront of the new psychedelic medicine industry. It hasn't wasted any time in starting to build out a competitive advantage that's based around domesticating psychedelic chemicals into predictable and controllable medicines. This diamond in the rough won't be profitable for years -- and I'm still ready to invest in it today.

Mushrooms growing

Image source: Getty Images.

Yesterday's contraband is the breakthrough therapy of tomorrow

Mind Medicine hopes to use substances like psilocybin (an active ingredient in "magic mushrooms"), LSD, and MDMA (also known as ecstasy) for tough psychiatric conditions like anxiety, opioid withdrawal, seasonal affective disorder (SAD), and attention deficit hyperactivity disorder (ADHD). While treatments for these maladies already exist, many are not curative or not completely effective in all patients. So the company is developing formulations of psychedelic chemicals that might not suffer from common drawbacks.

Its development pipeline has a handful of early-stage clinical trials. In particular, its "Project Lucy" investigating LSD as a treatment for anxiety will conclude the first part of its phase 2 clinical trials in Switzerland in early 2021, and management hopes to get the ball rolling with the U.S. Food and Drug Administration (FDA) shortly thereafter. Of course, it'll need to push through longstanding taboos about psychedelic chemicals to succeed stateside. With major pharma companies like Johnson & Johnson initiating new psychedelic drug development programs using drugs like esketamine, MindMed will be in good company.

Experienced pharma investors will point out that the chemicals the company is developing can't be patented, as they are either of natural origin or were discovered long ago by someone else. This isn't a problem, however, because there is intellectual property (IP) in development that will still be quite valuable.

In short, the intellectual value lies in the fact that researchers have developed a medicine that terminates the activity of its psychedelic drugs. They've also pioneered a new precision dosing protocol to make sure that each dose is perfectly calibrated to the needs of the patient. As a result, therapists will have a greater degree of control over the intensity and duration of the psychedelic experiences that patients are having. In theory, there shouldn't be any need to worry about having a "bad trip" when receiving treatment.

Upcoming catalysts will spark growth

So, why is now the right time to get in on Mind Medicine? It has no revenue, and it lacks big-name collaborators in industry, not to mention lacking a clear path through convoluted drug laws across the globe. But it has a compelling collection of projects, and it's also one of the more advanced psychedelic therapy companies in the nascent industry.

More importantly, it recently filed to be listed on the NASDAQ, and it may be traded on the exchange as soon as early next year. This will be a major catalyst for the stock, as it'll draw in higher trading volume and likely more interest in the company's long-term future. And, over the next year, if management's plan pans out, you'll see collaborators start to reach out, most likely after one of the early-stage clinical trials reports its preliminary results. Its growth story is only beginning, and it may well be one of the most important companies of its kind over the next two decades. Investing now ensures that time will be on your side.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.