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The smart money in medicine: cannabis and psychedelics come of age

Published 13/06/2023, 02:01 pm
© Reuters The smart money in medicine: cannabis and psychedelics come of age

Cannabis and its psychedelic comrades MDMA and psilocybin have come a long way from the street to the clinic in the last decade or so, before which they were regarded as well outside the bounds of mainstream western medicine, to put it mildly.

Up until the 1980s, these substances were associated with hippies and the counterculture of the 1960s – turning on, tuning in and dropping out – and advocacy for their benefits was in the hands of eccentric cultural figures like Dr Timothy Leary, who researched psychedelics at Harvard in the 1960s, and the author Aldous Huxley, whose book The Doors of Perception described his own experiences with psychedelic drugs and gave a legendary Californian rock band its name.

Here in Australia, cannabis was viewed as an illegal recreational drug and possession was penalised with heavy criminal fines and jail time up until the 1990s.

Decriminalisation started to pick up pace from this time, with various Australian states relaxing the rules, but it wasn’t until the mid-2010s that progress really took off for cannabis as a serious medical treatment when a 2016 law allowed for the cultivation and production of cannabis for scientific purposes.

This was followed by the decision in February this year by the Therapeutic Goods Administration (TGA) to allow medicines containing psilocybin and MDMA to be prescribed by authorised psychiatrists for the treatment of certain mental health conditions from July 1 this year, improving the research landscape yet again.

These two regulatory changes have made Australia one of the most favourable jurisdictions in the world for the development of cutting-edge treatments that use these compounds as their foundation.

"The rescheduling of MDMA and psilocybin by the TGA caught the attention of the world, and Australia is at the forefront of studying the therapeutic potential of these substances," Emyria Ltd (ASX:EMD) managing director Dr Michael Winlo says.

In this article:

  • A potted history of pot
  • What is it good for?
  • What does the future hold?
A potted history of pot

In the early 20th century, Australia adopted a similar approach to many other countries, enacting laws to regulate and eventually prohibit the use of cannabis.

In 1925, cannabis was classified as a prohibited substance under the Opium and Other Drugs Act in New South Wales and similar legislation was introduced in other states and territories.

During the 1960s and 1970s, there was a notable cultural shift and changing attitudes towards cannabis, leading to the 1980s when South Australia became the first state to decriminalise the personal use and possession of small amounts of cannabis in 1987, followed by the Northern Territory in 1996.

Other states and territories introduced various forms of decriminalisation, which typically softened penalties for minor cannabis offences.

In the 1990s, the concept of medical cannabis gained attention, leading to discussions about its potential therapeutic benefits.

In 2016, the Federal Government passed the Narcotic Drugs Amendment Act, allowing for the legal cultivation, production and distribution of cannabis for medical and scientific purposes under strict regulations.

At this point, access to medical cannabis remained limited due to the complexity of the regulatory framework and the requirement for patients to obtain special approval – but the writing was on the wall.

“That really was a watershed moment, when people re-evaluated their view of this plant being the drug of hippies and outcasts to potentially having a medical role, with properly regulated, properly developed versions of cannabinoids,” says Winlo.

“And what we've seen since is a flourishing of the sector ever since then, with Australian producers growing and trying to refine products that can deliver the key biological ingredients of the medicinal cannabis plant.”

What is it good for?

There are two main cannabinoids of interest to the biotech industry in the marijuana plant – tetrahydrocannabinol, or THC, which is the chemical that causes the high from cannabis, and cannabidiol, CBD, which has no intoxicating effects.

Medicinal cannabis products harness the powerful pain-killing properties of THC and CBD to combat chronic pain and inflammation caused by arthritis, muscular tension, neuropathic distress and even cancer.

Clinical companies are also investigating the use of medicinal cannabis in an incredibly broad range of indications, including treating anxiety and depression, insomnia, epilepsy and multiple sclerosis (MS).

Incannex Healthcare Ltd (ASX:IHL, NASDAQ:IXHL) is targeting inflammatory bowel disease, obstructive sleep apnoea and traumatic brain injury, among a range of other unmet needs, with its stable of cannabis, psilocybin and MDMA-derived assets.

CEO Joel Latham says the stigma in the public imagination has long been a barrier to medical access and welcomes the changing legislation.

“Because they've been classified as illegal recreational substances in the past, they’ve not been looked at as favourably as other compounds.

“When they're being used as medicines and therapies, what we've really tried to do is remove that stigma.

“Now we've seen the stigma change over the past few years, it's becoming more acceptable, and Australia is becoming more of a favourable place to be able to access alternative therapies such as medicinal cannabis-related products.

“We don't like to look at it as a medicinal cannabis product, a psychedelic associate product, we see ourselves as a fully-fledged biotech developing novel pharmaceutical treatments, regardless of the compounds that are being used.

“We happen to use psychedelic compounds and digital cannabis compounds because we're able to achieve enhanced research outcomes.

“That's where the industry is going to continue to evolve and develop because there's so much literature out there that justifies the use of these compounds and therapies that have been around for hundreds of years. And really, what we're doing is trying to bring that to light.”

Medtech Emyria is also out front with trials investigating the treatment of Parkinson’s and fibrotic disease with MDMA, along with CBD in over-the-counter applications for psychological distress.

On the psychological front, MD Dr Michael Winlo says there’s a lot of hope.

"The controlled use of MDMA and psilocybin in therapy sessions has shown remarkable outcomes for patients with difficult-to-treat conditions," he says.

"Patients that take MDMA with PTSD and sit with the therapist while they're on the medicine can have a remarkable improvement in their symptoms.

“Two-thirds of the patients on a particular trial went into complete remission after just three intense sessions.

“There needs to be longitudinal studies to see where these patients are in 5-10 years, but it's really exciting to be involved in figuring out how we can get this to patients in need."

Winlo thinks there is a need for rigour in trials and testing to garner public confidence in these treatments and to legitimise them as tools in the fight against chronic disease.

"Long-term studies are needed to understand the durability and long-term effects of these treatments and to provide further evidence of their efficacy."

What does the future hold?

The future of cannabis regulation in Australia is subject to ongoing debates and discussions at both state and federal levels.

Exact trajectories are difficult to predict but certain developments and trends have emerged.

The doors are now open to continued expansion and refinement of the medical cannabis framework in Australia.

This will include efforts to streamline patient access, improve affordability and enhance the availability of different cannabis-based therapies.

Given the patchwork nature of cannabis regulation in Australia, further reforms are likely to take place at the state and territory levels.

Clinical trials and research on the medicinal properties of cannabis are likely to intensify, in turn informing future policy decisions.

Trials studying cannabis-based treatments for specific medical conditions may lead to more evidence-based approaches to regulation and expand the range of approved therapeutic applications. And no doubt the international regulatory environment will influence our next regulatory move.

“We've obviously seen a resurgence, particularly in the US, in the use of psychedelics,” Joel Latham says.

“But the TGA is leading the way here in Australia, with the scheduling of MDMA and psilocybin, and we applaud the TGA for making that decision.

“I think that's a great outcome for Australian patients suffering from debilitating conditions. And I think it's only going to continue to improve over time.”

Read more on Proactive Investors AU

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