3 Good Reasons why MMED stock could go big

marc

Written By: Marc Challande

Published June, 12th 2021

If you had bought MMED stock last summer, you would enjoy already a 1000% Return on investment. Indeed, psychedelic mushrooms proved they could be the cure for mental health issues, reinforced because of Covide-19. We are here to give you 3 reasons why MMED stock could go big in the industry.

3 Good Reasons why MMED stock could go big​

One man : Kevin O'Leary

Kevin O’Leary aka Mr Wonderful isn’t a small investor. Endeed, his net worth is valued at $400M and he is the man buoying the sector. In an interview with “Insider“, Mr Wonderful mentioned “the US Centers for Disease Control and Prevention reported that 11% of American adults considered suicide while a whopping 40% reported they were struggling with mental health or substance abuse” and so mushrooms open a new healing opportunity and so a new market opportunity .

Besides, he wants to make sure that everybody know the end has its risks too: “That’s not to say that any single investment is a sure bet. I have been investing in Pharma and biotech for years, and trust me: It’s always a long game and the outcomes are typically binary. None of these companies make money to start, and they will have to raise hundreds of millions of dollars to complete their clinical trials.” 

3 Good Reasons why MMED stock could go big

A Huge Market Opportunity

The mental health crisis is nothing new. The WHO (World Health Organization) explains that around 700 million are affected by mental health disorders. And, because of Covid, mental health issues augmented. Due to the conditions surrounding the novel virus, more than one billion people are estimated to be affected by stress-related mental health conditions like depression, anxiety, addiction and PTSD.  Now, we can have now more awareness about mental health treatments as countries or US states ease the psychedelic treatments uses. Recently, Oregon voted in favor of Measure 109, which sought to legalize psilocybin mushrooms for controlled therapeutic use. 

What used to be tabou could become a $100B industry where the Global Mental Health Cost is Expected to total $16 trillion through 2030.

Psychedelic uses could also help to reduce the lost of efficiency. According to the US Centers for Medicare & Medicaid Services:

  • 284 M globally suffer from anxiety leading to a $1 Trillion per year in lost global productivity ;
  • 16 M US Adult ADHD Sufferers causing a $194 Billion lost productivity Annually in the US;
  • 300 M prescriptions in the US for opioid costing $2.5 Trillion to the United States economy over four year.
3 Good Reasons why MMED stock could go big

Ongoing Trials

MMED partnered with 2 universities, the University Hospital Basel’s Liechti Lab with who they have 17 ongoing or completed trials,  and the Maastricht University for the  Phase 2a Clinical Trial – Adult ADHD.

MindMedicine also owns a diversified pipeline of Psychedelic Drugs in Clinical Development and R&D including: 

  • LSD Experiential Therapy (anxiety) in Phase 2b;
  • 18-MC (opioid withdrawal) in Phase 2a;
  • LSD Assisted Therapy and Cluster Headaches in Phase 2a;
  • Multiple ongoing or completed: on LSD, MDMA, DMT, Psilocybin in Phase 1B.

But let’s talk about 2 main potential products starting with the Phase 2a ADHD they acquired. By doing this, they first saved roughly $8.4M to $26.2M  in non-dilutive financing costs and 4+ years of time. Moreover, they will target the Incision and Drainage (IND) with a Phase 2b study for Q3 2021.

About the 18-MC project which could regulate dopamine and reduce addictions, is currently in the Phase 2a. We are still in the early stages and, according to their schedule, would submit their non-disclosure agreement to the FDA by Q4 of 2025. 

We just mentioned few projects that are the tip of the iceberg. MMED is developing their footprint in different sectors which will bring them long-term revenues (New parterships driven by software, Digital Medicine Division, LSD Microdosing Study, Discovery Division…).

What about their fudnamentals ?

MindMedicine is currently traded at $4.74 CAD for a market cap of above $1B with a 52 weeks low of $0.3950  and a 52weeks high of $5.9900. After the frenzy times because of the Nasdaq approval leading to the all time high, then happened a harsh downtrend before seeing a consolidation around $4. 

Also, MMED doesn’t have any problems to raise cash as $204M USD was raised since inception (including warrants). The investors have a strong backing as show the to last bought deal financings : 

  •  Jan 21: $72m USD 
  • March 21: $15.4m USD

The insiders own 17.3% of the total shares and 5.9% represent outstanding warrants if more cash is needed. Positive/Negative because they could raise more funds but negative because it would dilute the shareholder’s ownership’s value. the total (Fully diluted) number of share could represent, if conversion of warrants, 434,425,597 shares.

For now, we can’t talk about P/S ratio as the share price is lead mainly by the market opportunity. In comparison, NUMI  has a P/S of 216.62 and TRIP has a P/S of  8,129.75.

What's at the end of the line ?

MMED is doing significant progress through their projects and investors show their positive feeling with a $1B Market Cap confidence. Despite all the positive aspects psychedelic  mushrooms have, MMED and the companies from the sector will have to face countries’ legalizations. Moreover there will still be wait because of trials and as O’Leary said, they might have to raise more cash to complete them.

Besides these small negative thoughts, MMED could take a bigger part of the $100B market worth if they succeed to monetize all their products that could potentially change the world. Don’t forget that if you have invested or not yet in MMED, you invest in. potential market, not on something already proved. But the bigger the risk is, the greater the reward is.

 

 

This article solely expresses the opinion of the writer which might be disagreeing with the other writers of Money,eh?

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