Palo Santo has announced the closing of its USD$50m (~£134.10m) fund which will go towards a diverse portfolio of businesses developing innovative psychedelic medicines and therapies.
The funded therapies will be targeting mental health and a range of central nervous system disorders.
To date, the fund is over 20 portfolio companies across the psychedelic ecosystem, including Beckley Psytech, Tactogen, Bexson Biomedical, Ksana Health, Gilgamesh Pharmaceuticals, Delix Therapeutics, Journey Clinical and Fluence, among others.
The company states that it combines its investing and portfolio-building experience with the expertise of leading academics and advisors in psychedelic science.
Palo Santo co-founder, Tim Schlidt, commented: “Following decades of criminalization, psychedelics are demonstrating their potential to treat mental health disorders more rapidly and durably than currently available treatments, in a field that hasn’t seen substantial innovation for over 30 years.
“Against the backdrop of a growing global mental health crisis, our mission is to drive clinical development and FDA approval of these much-needed therapies that we believe will become the future standard of care.
“We are proud to play a role in this paradigm shift and look forward to creating value for our portfolio companies, investors, and most importantly patients and their loved ones.”
Co-founder Daniel Goldberg added: “It’s very encouraging to see the momentum in psychedelic drug development supported by leading academic institutions, investors, regulators and politicians from both sides of the aisle.
“MDMA is expected to be approved within the next two years as a breakthrough therapy for treatment of PTSD and psilocybin approximately two years after that for depression.
“With roughly fifty percent of our Fund still to deploy, we are well positioned to put money to work in a more favourable investing environment while fostering innovation in the mental health field.”
Palo Santo’s advisory board includes pharmacology expertise with leading serotonin 2A researchers Charles D. Nichols, PhD and John D. McCorvy, PhD; psychiatric expertise with Julie Holland, MD and John F. Greden, MD; clinical and commercial expertise with Stephen Wright, MD; intellectual property know-how with Gretchen Temeles, PhD, J.D.; and aptitude around medicinal chemistry with David Sherman, PhD.
Beckley Psytech CEO, Cosmo Feilding Mellen, commented: “Globally, there is a huge unmet patient need for more effective mental health treatments. Psychedelic therapies represent a potentially exciting new class of neuropsychiatric treatments and it’s been so important for this nascent industry to have the backing of diligent investors such as Palo Santo.
“We are grateful for their support, which has helped us to advance our pipeline of psychedelic programs, and look forward to continuing to work with their team.”
Palo Santo Scientific Advisor and Medical Advisor to the Multidisciplinary Association for Psychedelic Studies (MAPS) Julie Holland, MD, concluded: “Having been a clinical psychiatrist and psychopharmacologist for the past 25 years, I see incredible potential for psychedelics to benefit patients, including those whose therapies are no longer effective.
“It’s crucial that the most promising companies and therapies receive the funding needed to advance psychedelic medicines through clinical trials in a timely manner, and I am proud to be part of a team of experts who share that same goal.”
