Editorial Coverage: The search for ways to improve mental
health is driving expansion for a variety of companies looking to
offer effective solutions, including treatments that are tapping
into the power of psychedelic mushrooms.
Champignon Brands Inc. (CSE: SHRM) (SHRM
Profile) is one of the innovators in
this field, expanding through acquisitions and outside funding to
support R&D and a growing product line focused on artisanal
medical mushroom formulations and mushroom-infused functional
beverage CPGs. It’s a range of products set to appeal to markets
similar to Herbalife Nutrition Ltd. (NYSE: HLF),
which provides nature-based products for physical and mental
health. Biopharmaceutical company Axsome Therapeutics Inc.
(NASDAQ: AXSM) is also tackling serious depression, with a
new drug currently undergoing trials. Allergan (NYSE:
AGN) has recently announced a new drug to tackle bipolar
disorder, with a single treatment for both manic and depressive
phases. Meanwhile Johnson & Johnson (NYSE:
JNJ) is showing the power of previously scorned drugs with
a ketamine-based depression treatment.
- Psilocybin, the active ingredient in psychedelic mushrooms, has
the potential to treat serious illnesses such as depression.
- R&D work, supported by prominent investors, is quickly
pushing forward understanding of the chemical’s potential.
- This has allowed mushroom-focused companies to bring both
products and shares to market.
To view an infographic of this editorial, click here.
Companies Rise Through Mushroom Boom
The expansion of the functional food and drinks sector has
created a new opportunity. While cannabis and CBD have taken these
consumables beyond the traditional active ingredients of alcohol
and caffeine, this diversification of the market has opened up
consumers to new possibilities. Among those possibilities is the
use of natural ingredients found in mushrooms.
For decades, these mushrooms have played a part in alternative
culture, a hidden consumable for those looking to expand their
minds. But with a better understanding of the mushrooms and safe
techniques to process them, other options are becoming available.
Researchers are exploring how the psycho-active ingredient derived
from mushrooms, psilocybin, could be safely used in health products
and associated delivery platforms. Companies are emerging to take
those promising new products to market.
An Emerging Mushroom Company
One of the leaders in the move to bring mushroom-infused
wellness products to market is Champignon Brands Inc. (CSE: SHRM). A
rare public company built around a mushroom-to-market strategy,
Champignon is leveraging the growing functional beverages market as
well as breakthrough medicinal therapy involving psilocybin and
MDMA-based delivery platforms. Champignon’s Vitality Teas brand
offers a range of teas infused with ingredients derived from the
most desirable artisanal medical mushrooms – Reishi, Chaga and
Lion’s Mane. This unique line of teas offers an entry point both
for consumers and investors, providing an ideal opportunity for
people to experience the health effect of mushrooms in a safe,
familiar product, while allowing investors to participate in the
This is new territory, perfect for the flexibility and
innovation that come with a young company. Champignon’s strategy
involves cultivating and distributing artisanal medical mushrooms
and products derived from them, while maintaining control of its
whole product chain. The company is laying the groundwork for what
could become a significant new industry.
As a step toward both funding and legitimizing its work,
Champignon is working its way onto the world’s stock markets. SHRM
began trading in Canada in February and is now
in the process of securing listings in the United States and
Germany, which would give the company access to significant new
markets and investor bases.
Psilocybin – the Magical Ingredient in
The health-bringing potential of mushrooms stems from one
chemical — psilocybin. The psychedelic molecule found in most
psychoactive mushrooms, psilocybin is a naturally occurring,
mind-altering substance that humans have made use of in religious
and cultural ceremonies for centuries. While the effect of this
specific chemical has been known for decades, its medical potential
is only now starting to be recognized and explored.
A main possibility for the products of companies such as
Champignon lies in treating challenging mental-health issues.
Post-traumatic stress disorder (PTSD) and treatment-resistant
depression (TRD) are widely recognized as serious issues affecting
thousands of people on a daily basis. Depression costs an estimated $210.5 billion per year, and this
has created an antidepressant drugs market valued at $13.69 billion
in 2018, which is expected to expand to $15.88
billion by 2025. An article in The Journal of
Clinical Psychiatry estimates the cost to employers of TRD
alone at $48 billion per year.
Treatment of these illnesses can be challenging, and any
medicine with potential to help will be welcomed by a huge raft of
patients and practitioners. Research shows that psilocybin has
potential to help with these disorders, and now both the medical
profession and the markets are responding.
High-profile investors such as Peter Thiel, Tim Ferriss, Kevin
O’Leary and Canopy Growth’s ex-CEO Bruce Linton are all taking an
interest. Linton and O’Leary have become seed investors in MindMed, which develops medicines
based on psychedelics. Thiel is an early investor
in mental health care Compass Pathways, which makes use of
psilocybin. Ferriss has been a leader in
fundraising for the new Johns Hopkins psychedelic research
With mental health high on the world’s agenda and more companies
opening the door to psilocybin, the likes of Champignon have a
legitimacy and level of investor interest that would have been
unimaginable a decade ago.
The Need for Mushroom R&D
There are no safe shortcuts when dealing with psychoactive
chemicals, and so a great deal of R&D work is needed to bring
mushroom-derived health products to market. That’s reflected in the
focus of companies entering this market as well as the academic
institutions taking an interest.
Champignon has established a dedicated R&D laboratory. The
facility will work on three distinct but connected issues around
psilocybin and mushrooms:
- How to integrate mushroom extracts as an alternative-medicine
- Formulating bioactive compounds extracted from plants and
- Isolating and synthesizing certain plant and fungi
The overall goal of this work is to research and distribute
premium, medicinal, mushrooms-infused products that can be used to
target high-margin markets as well as consumers open to the health
and wellness benefits of mushrooms.
Getting this work right takes specialist expertise and
oversight. To this end, Champignon is forming a special advisory
committee to oversee its R&D. With members drawn from fields
such as medicine, psychology, mycology, and pharmacology, the board
will carefully evaluate the potential effects of its
medicinal-mushroom formulations and the accompanying benefits in
treating disorders such as depression, PTSD, and substance and
alcohol abuse. Through these skilled and experienced specialists,
the company will bolster the effectiveness and scientific validity
of its work, providing reassurance to both customers and
While R&D will provide mushroom companies with powerful new
products, that alone isn’t enough to ensure their viability. For
that, they’ll need to pair innovative products with sound business
Which strategies each company follows will depend upon their
individual circumstances and leadership. For Champignon,
acquisitions are playing a part. The company recently
announced that it has entered into an agreement to acquire
Artisan Growers Ltd., a craft-mushroom cultivator and supplier.
Artisan Growers operates a mushroom facility cultivating a variety
of organic craft mushrooms. This facility will be integrated into
Champignon’s mushroom manufacturing, formulation and distribution
infrastructure to expand and strengthen SHRM’s supply chain.
In taking this supply chain to consumers, Champignon has
developed a retail strategy that aims to revolutionize the $200
billion functional foods and beverages sector by introducing
exceptionally formulated mushroom-infused products. A combination
of brick and mortar distribution, e-commerce sales and online
influencer marketing is being used to quickly develop a retail base
for the company’s novel products.
To further expand its alternative medicine product range,
Champignon recently announced the acquisition of
Novo Formulations Ltd., whose manufacturing partner is capable
of processing proprietary delivery systems in its
40,000-square-foot, GMP-certified, Health Canada-approved and
Federal Drug Administration-approved manufacturing facility..
According to the announcement, Champignon plans to leverage
Novoformulations' existing product development infrastructure and
licensed affiliates to pursue psilocybin and MDMA-based
formulations, with the objective of developing and commercializing
rapid onset treatments capable of improving health outcomes,
including depression, PTSD, and substance and alcohol use
disorders. The current marketplace for pharmacologic DPS treatments
in North America exceeds $10 billion annually.
Providing Healthy Products
Of course, deriving healthy foods, drinks and supplements from
nature is nothing new. For Herbalife Nutrition Ltd. (NYSE:
HLF), that approach has been the foundation stone of a
business for 40 years. Like the active mushroom companies,
Herbalife uses science to create healthy products, including
vitamin supplements and protein powders to deliver physical health,
as well as stress-management products for mental health. In an
increasingly health-conscious society, this has been a huge
success, giving the company some of its best
sales yet in 2019.
Axsome Therapeutics (NASDAQ: AXSM), a
biopharmaceutical company specializing in treatments for central
nervous system disorders, also offers help for those struggling to
achieve mental health. The company’s treatments cover ailments
including narcolepsy, migraines and treatment-resistant depression.
TRD covers any major depressive disorder that doesn’t respond to
two or more therapies, leaving the patient struggling for help.
Axsome is developing a drug aimed at TRED treatment and is
randomized trials to assess the effectiveness of the drug.
Irish pharmaceutical company Allergan (NYSE:
AGN) is another innovator in the health field, with its
R&D department working on a steady stream of treatments for
physical and mental health. This includes a new treatment announced last year for the treatment of bipolar
disorder. This treatment can be used to tackle manic, depressive
and mixed episodes, making it easier for patients to manage their
mental health and maintain a stable lifestyle.
Mushrooms aren’t the only previously scorned drug being turned
into a tool of improved mental health. Johnson &
Johnson (NYSE: JNJ) received approval
from the FDA last year for a nasal spray derived from the
anesthetic ketamine. Ketamine has been best known in recent years
because of its abuse as a party drug, more often featured in crime
dramas than medical procedurals. Doctors have known for years that
ketamine could be helpful in treating depression, but treatment was
administered through intravenous delivery, without the financial
support of insurance companies. Johnson & Johnson’s product
could be one of the most radical changes in depression treatment
As research reveals the potential of new and innovative
mental-health treatments, including artisanal medical mushrooms, a
raft of new treatments could soon be on their way.
For more information on Champignon Brands, visit Champignon
Brands Inc. (CSE: SHRM)
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