Psilocybin is having a moment. Like cannabis before it, psilocybin, the psychoactive compound in so-called magic mushrooms, is slowly becoming more mainstream. Although it is listed as a Schedule 1 Drug and classified by the Drug Enforcement Administration as having "no currently accepted medical use and a high potential for abuse," a number of cities and states are moving to legalize and regulate the compound given the drug's therapeutic use for those suffering from, among others, mental health issues.
Efforts to Decriminalize and Regulate Psilocybin
On November 3, 2020, Oregon became the first state to legalize psilocybin when voters enacted Measure 109, which allows therapists to provide psilocybin to patients suffering from PTSD, depression, and a variety of other mental health diseases and disorders. Importantly, the legislation creates a tightly-regulated framework in which psilocybin therapy occurs in a controlled setting. Oregon’s approach is unique in that the state didn’t simply move to decriminalize psilocybin; it moved to make it available to patients in a number of controlled settings.
After witnessing what occurred in Oregon, other cities and states have followed suit. A Florida state lawmaker has proposed similar legislation, the Florida Psilocybin Mental Health Care Act, which would allow patients diagnosed with a mental health issue access to psilocybin-assisted therapy. Lawmakers in Connecticut have also filed new bills to reform state law on psilocybin and to create a task force to study the medical benefits of magic mushrooms. A number of other states are considering similar legislation.
Big Business and Psilocybin
As proof of this, big money has begun pouring into various psilocybin-related startups and established businesses that seek to disrupt mental health care, and many in the burgeoning industry believe the legality of psilocybin is roughly where medical cannabis was six or seven years ago. While there is less of a diversified recreational market for psychedelics, state ballot measures and positive results from university studies will undoubtedly continue to broaden the circumstances under which psilocybin can be utilized for mental health therapy.
How Law Firms Are Aiding Growth in the Psilocybin Industry
As further evidence of the increasing acceptance of psilocybin, law firms have begun establishing psychedelic law practices. These practices are driven by the belief that psychedelics will likely have an easier path to acceptance, particularly because of their medicinal value and the fact that many of the companies in the psychedelic space are endeavoring to bring their products to market after spending years and millions of dollars in clinical trials and an approval process overseen by the FDA. Given the connection between psychedelics, the pharmaceutical industry, and potential breakthroughs in medicine for mental health, it is easy to see why law firms would want to begin exploring the space, building relationships, and preparing for a potentially lucrative new market.
There will be a significant need for attorneys who specialize in regulatory and transactional work, along with those experienced in pharma- or cannabis-related litigation. Companies in these niche industries routinely require assistance with filing applications, negotiating management agreements, settling commercial disputes, resolving employment matters, and much more. Those companies will be much better positioned to navigate business and legal issues by partnering with a lawyer who has experience serving these industries.
If you are operating a licensed cannabis or psilocybin company and have questions about potential issues your company may face, contact the author, George Mahaffey.