What happened

atai Life Sciences (ATAI 2.98%), a clinical-stage biopharmaceutical company that specializes in the use of psychedelics to treat mental health conditions, saw its shares rise 14.58% on Tuesday. The stock closed at $2.95 on Monday then opened on Tuesday at $3.15. The stock rose to as high as $3.65 a share by 11 a.m. ET before dropping to $3.48 at the close. So far this year, the stock is down more than 55%, and has a 52-week low of $2.60 and a 52-week high of $17.81.

So what

atai's shares got a bump when Loop Capital initiated coverage of the stock with a buy rating and an $18 price target on Tuesday. This would represent an all-time high for the stock, which went public with an initial public offering (IPO) last year.

The company also announced that it plans to participate in several upcoming conferences this month and to announce its third-quarter earnings on Nov. 10.

The company has two therapies, PCN-101 (R-Ketamine) and RL-007, that are in late-stage phase 2 trials. The first is to treat treatment-resistant depression (TRD) and the second to treat cognitive impairment associated with schizophrenia. The PCN-101 trial just completed enrollment, the company said in an announcement on Oct. 25.

Now what

In its Q2 earnings report, the healthcare company said it has enough cash to fund operations into 2025. atai also updated the late-stage progress in clinical trials for COMP360, a TRD psilocybin-based therapy it is developing with Compass Pathways. atai said it launched a phase 2 trial for COMP360 to treat anorexia nervosa in July and that it expects to begin a phase 3 trial for the therapy for TRD by the end of this year.