As Prescribed


The development of psychedelic drugs for medicinal uses has substantially expanded since 2020, as evidenced by an exponential growth in Drug Enforcement Administration (DEA) production quotas for both psilocybin and psilocin. In 2024, these quotas grew to 20,000 g and 24,000 g, respectively, from just 30 g and 50 g in 2020.

Reflecting the growing interest in this drug development opportunity, on April 12, 2024, American University brought together leaders in neuroscience, medicine, policy, and law to discuss the future of psychedelic drug therapy. Speakers included scientific and medical experts as well as pharmaceutical companies and patient advocates. The symposium discussion shed light on the potential promise of psychedelic drug product therapy, as well as potential challenges for clinical trials and FDA approval. Discussion items included:

  • Challenges isolating a psychedelic product’s effect in clinical trials. Multiple speakers discussed the importance of combining psychotherapy with psychedelic medications for the treatment of various medical conditions. This includes the process of preparing the patient to undertake psychedelic-assisted therapy and assisting the patient to process their experiences after psychedelic product therapy (referred to as integration).

    Designing a study that allows the FDA to tease out the effect of the medication from the effect of the psychotherapy is especially challenging. In its draft guidance on psychedelic drug development, the FDA states that when psychological support or psychotherapy is included within a clinical trial design, “this additional variable both complicates the assessment of effectiveness and presents a challenge for any future product labeling.”

    The FDA further states that “sponsors should plan to justify the inclusion of a psychotherapy component and describe any trial design elements intended to reduce potential bias or to quantify the contribution of psychotherapy to the overall treatment effect.” The FDA recommends the use of a factorial study design to characterize the separate contributions of the drug and the psychotherapy. However, factorial studies raise questions regarding whether it is ethically appropriate to administer a psychedelic product candidate without associated psychological support. Additionally, sponsors incorporating a psychotherapy element into clinical trials will need to take special precautions to ensure that the psychotherapy procedures are standardized across investigators.

  • Preserving blinding and minimizing bias. As noted by speakers and by the FDA in its draft guidance, blinding is particularly difficult in psychedelic product trials for multiple reasons. Subjects receiving the active drug experience functional unblinding due to intense perceptual disturbances (speakers noted that while subjects on placebo may not accurately guess whether they have received placebo or active drug, subjects on active drug nearly always accurately guess that they received the active substance).

    At the same time, however, high subject expectancy (which may be caused by a subject’s own preconceived notions, psychotherapy interventions used in the trial, or an investigator’s own biases) may contribute to a “nocebo” effect (a worsening of symptoms when a subject knows they did not receive the active treatment). In its draft guidance, the FDA states that while an inactive control allows for better contextualization of safety results, alternatives, such as subperceptual product doses or products that mimic the psychoactive experience, may be options.

    However, sponsors must carefully consider the appropriateness of the comparator product as researchers at the symposium noted that studies have had mixed findings regarding the reason that psychoactive substances have an effect (with a particularly interesting line of research including studies administering ketamine to patients under surgical anesthesia in an attempt to isolate the impact of the psychoactive effect of the medications).

  • Preserving the integrity of a subject’s response and protecting the subject. One issue raised by symposium speakers is the fact that, following psychoactive substance treatment, subjects may remain in a vulnerable and suggestive state for some time (the FDA’s draft guidance suggests that it can last as long as 12 hours). From an ethical perspective, this requires that controls be in place to ensure a subject’s safety, including, as recommended by the FDA, observation by a professionally credentialed monitor and an assistant during the treatment session. This suggestibility, however, also raises study design questions around the controls that are in place in a study to ensure that investigator biases do not impact a subject’s response to endpoint measures. Moreover, because psychedelic products may present unique ethical considerations, sponsors should consider whether additional experts (such as medical ethicists)—while not legally required—should be involved in the development of study protocols.
  • Navigating federal- and state-controlled substance requirements. In many cases, psychoactive substances under investigation may already be Schedule I controlled substances under DEA and/or state regulations. (If you’re unsure about whether a substance is already scheduled on the federal level, the DEA has a process where a formal determination can be requested.) Notably, just because a substance is not yet scheduled at the federal level does not mean it is not scheduled at the state level, as many states have more extensive lists of controlled substances than the DEA.

    If a substance is scheduled on either the federal or state level, various controlled substance registrations and study approvals must be in place for entities within the supply chain as well as researchers before the investigational product may be produced and shipped to investigational sites. Depending on the geographic area, registration requirements can take a significant amount of time, and need to be accounted for when planning a development program. Controls also need to be implemented to meet the many controlled substance regulatory requirements, which include special ones for the ordering and distribution of Schedules I and II controlled substances to enable the maintenance of the study blind.

    One area that frequently is not an area of focus (or even realized) is the potential need for state board of pharmacy manufacturing and distribution licensing, regardless of a product candidate’s controlled substance status, because not all states include licensing exemptions for investigational products. This includes potential licensing for study sponsors, even if they are not physically manufacturing or distributing products, under state requirements applicable to virtual manufacturers and virtual distributors.

  • Understanding scheduling requirements. While not discussed by symposium speakers, another area that sponsors of psychedelic products will have to navigate is the need for DEA scheduling actions. This requires that sponsors conduct assessments of a product’s abuse potential and provide the FDA with a proposal for drug scheduling under the Controlled Substances Act.

    Based upon an eight-factor analysis that considers a number of different areas, including a product’s potential for abuse and the risk to the public health, the FDA will make a scheduling recommendation to the DEA, which then conducts its own review and publishes an interim final rule regarding the drug’s control status. Under the Controlled Substances Act, the DEA is required to issue this interim final rule no later than 90 days after FDA approval of a New Drug Application. Accordingly, sponsors should be prepared for the need for scheduling following product approval, as this will impact the timeframe for product launch.

  • Infrastructure required for patients to be safely and effectively treated with approved psychedelics. Much symposium discussion centered around how psychedelic medicines should be responsibly used by healthcare providers once approved by FDA. For example, as noted above, speakers discussed the importance of incorporating psychotherapy with the use of psychedelic medicines. However, as the FDA does not regulate the practice of medicine, the FDA-labeled conditions for use of a product would not go into detail regarding supportive treatment that may be advisable (at most a label would say that a medication should be used under the supervision of a healthcare provider or as part of a treatment plan). Rather, it will fall to state medical boards and medical associations to provide recommendations and requirements regarding how to properly use psychedelic medications. To the extent that it is determined that such medications should be used in conjunction with psychotherapeutic support and/or that multiple practitioners should be present for patient dosing, this raises the question of how such services will be paid for.

Overall, psychedelic medications hold significant potential for the treatment of patients for a variety of medical conditions, including psychiatric and substance use disorders. However, despite this potential, companies developing these product candidates will need to grapple with multiple layers of regulation, including FDA, DEA, state boards of pharmacy, state medical practice boards, medical associations, and payors. Development of programs to study and seek approval of these products requires extensive knowledge of and background in the underlying regulatory structures, as well as significant planning to ensure that regulatory requirements are met. Accordingly, companies in this space should acquaint themselves with their compliance requirements and put systems and processes in place to ensure that they comply with the applicable laws and regulations, as well as the FDA’s study expectations.