Company Overview
Founded in 2016, Compass Pathways (“Compass”) is a mental health care company focused on accelerating patient access to evidence-based innovation in mental health. It is currently developing a psilocybin therapy through a late-stage clinical trial for patients with treatment-resistant depression. The company is currently in the pre-revenue stage; However, with heavy investments into research (US$7mn+ in R&D expenses in 2018).
The largest investor in Compass is ATAI Life Sciences. Atai is a Germany based investment company acquiring stakes in biotechnology and related companies developing treatments for mental health disorders. ATAI operates a decentralized, technology- and data-driven platform. The platform approach allows ATAI to pool expertise and resources across its whole portfolio. Above all, this helps portfolio companies develop their respective drug candidates in the most efficient way possible.
Compass is also partnering with academic centers in America, to establish a virtual drug discovery center to develop better medications.
Clinical Trials
Its program received the U.S. Food and Drug Administration “Breakthrough Therapy” designation in November 2018. Its current trial is largest clinical study of its kind and is currently in phase IIb. The study looks at the safety and efficacy of psilocybin therapy in treatment-resistant depression, and aims to determine the optimal dose of psilocybin.
The phase I trials had earlier reported positive results evaluating the safety of psilocybin for the treatment of patients with depression. As a result, the aim of the phase II trials is to perfect the dosage. Initial dosing is supposed to end by summer 2020, with follow-up and results expected by early 2021.
Compass expects to have its treatment approved within the next five years. Meanwhile, it is working out the logistics of conducting a widespread rollout of a drug therapy; all of which require full-day assistance from a specially trained therapist in a specific clinical setting.
Fundraising Activity
April 2020: Compass closed its Series-B funding round with an infusion of US$80mn. Apart from participation from existing investor ATAI Life Sciences, several new prominent institutions took part as well including McQuade Center for Strategic Research and Development (a member of the global Japanese Pharma giant Otsuka companies), Founders Fund, Able Partners, Camden Partners Nexus, Perceptive Advisors, Skyviews Life Science and Solus Capital.
The funds will go toward expanding its program for psilocybin therapy for treatment-resistant depression. In addition, it will help with research on advancing its preclinical pipeline, developing digital technologies and expanding headcount. This, in effect, will help Compass to establish even more academic and clinical research partnerships.
October 2018: Closed its Series-A funding round of US$31mn with participation from Tim Davis, founder of Source Healthcare, and Principia SGR, an Italy based venture capital firm focused on investments in the life sciences industry.
Outlook
The cost of developing psilocybin therapy, with clinical trials in multiple countries, is significant and involves considerable risk and resources. The FDA fast-track process gives Compass a good headstart against competitors. Additionally, the support platform from ATAI bodes well for Compass.
Since psilocybin occurs in nature, it’s not possible to patent it. However, it is legal to patent a synthetic manufacturing process, which is exactly what Compass has done. The patent, issued in January 2020, covers the use of the company’s synthesized investigational psilocybin formulation, COMP360, for the treatment of clinical depression.
Many scientists believe psilocybin is one of the most promising innovations for depression. Depression is one of the fastest-growing health problems with over 100mn people around the world suffering from treatment-resistant depression. In conclusion, The breakthrough therapy designation for psilocybin therapy highlights the importance of supporting early research that can be translated into clinically meaningful outcomes.
