Huge Cost-Savings From Psychedelic Drug Therapy

• Study on MDMA-assisted psychotherapy to treat PTSD estimates enormous per-patient cost savings
• Psychedelic drugs are a cost-effective solution for treating mental health disorders that affect over 1 billion people
• Psychedelics-assisted therapies also yield huge quality-of-life improvements

A psychedelic drug study just released by MAPS, the Multidisciplinary Association for Psychedelic Studies, provides perhaps the best indication yet of the commercial potential of the psychedelic drug industry.

Was it another breakthrough clinical study on the effectiveness of psychedelic drugs in treating mental health disorders? No.
It was an economic study on the amazing cost-effectiveness of MDMA-assisted psychotherapy in treating post-traumatic stress disorder (PTSD).
Let’s reframe this.

This translates into a cost-savings of $103,200 per patient over a 30-year treatment horizon. This is more than just validation of the commercial potential of the psychedelic drug industry.

PTSD is at epidemic levels among military personnel and first responders. With healthcare budgets already strained to the breaking point by the COVID-19 pandemic, governments will feel enormous economic pressure to bring this therapy to market quickly.

In more general terms, this is the final factor necessary to conclusively establish the commercial potential of the psychedelic drug industry.

The three ingredients necessary for a successful psychedelic drug industry

Few things in life are certain. But three factors appear to make the commercial success of the psychedelic drug industry almost inevitable.
 

1. Strong medicinal efficacy of psychedelics-based therapies
2. Significantly superior treatment outcomes versus the existing standard of care
3. Cost effective therapies

With most psychedelic drugs currently illegal, the psychedelic drug industry needs to demonstrate extremely effective therapeutic results to create the political will to overhaul the current regulatory framework for these substances.

The results are there. In addition to the tremendous cost-effectiveness of MAPS’ MDMA-based treatment, there is a huge quality-of-life payoff as well for patients receiving this treatment: 5,553 Quality of Life years per 1,000 patients.

Clinical studies on the use of psychedelics to treat depression and addiction have yielded similarly spectacular treatment results.
 
Of equal importance, the existing standard of care for the treatment of PTSD, depression and addiction is dismal. Low success rates. Frequent relapses.

Grossly inadequate medical therapies for mental health disorders that afflict over 1 billion people.

But even with the treatment benefits of psychedelics, the psychedelic drug industry might never be able to get off the ground if it couldn’t also demonstrate that these therapies were (at least) as cost-effective as existing treatments.

In fact, according to the MAPS study the use of MDMA for the treatment of PTSD will yield exceptional per-patient cost savings versus existing therapies. That’s not just a passing grade on the commercial potential of psychedelic drugs, it’s an “A”.

A very effective drug. Far superior treatment outcomes versus the existing standard of care. Much more cost-effective therapy.

MAPS study implies cost-effectiveness for most/all psychedelic drug therapies

The MAPS economic study was a specific analysis on the cost-effectiveness of MDMA-assisted psychotherapy for the treatment of PTSD. But there are good reasons to believe that these numbers will extend across other psychedelics-based therapies as well.

Why?

The one major question-mark concerning psychedelic drug therapies is whether they could be delivered in a cost-effective manner. The reason for concern here is that individual psychedelics-assisted therapy sessions are relatively expensive, typically ranging from $500 - $1,000.

But psychedelic drugs actually work – unlike the existing therapy options for these mental health disorders.

Existing treatments for depression, addiction and PTSD tend to be endless. Only a tiny percentage of patients are ever fully cured. Enormous sums of treatment dollars are consumed.

This is why we now have a Mental Health Crisis.

Large numbers of people are developing these disorders. Mainstream medicine is delivering very few cures.

In contrast, most psychedelics-based clinical studies involve only a handful of therapy sessions. This is because after even a few treatments, the patient no longer exhibits the clinical symptoms for which they were obtaining treatment.

Another term for that is “cured”.

Spending a few thousand dollars to (in many cases) fix a mental health disorder is not an expense. It is an investment.

It is much more economically efficient than forcing people to undergo years of psychotherapy, spending far more for treatment (in total), and then often demonstrating little-to-no progress in overcoming their affliction.

But the out-of-pocket savings on treatment costs is only ½ of the economic argument in favor of psychedelics-based mental health therapies.

MAPS estimate of PTSD cost savings is “too conservative”

Read further into the MAPS press release and it becomes apparent why all governments will see an imperative need to approve this drug therapy for PTSD treatment.
 
In fact, we already have some numbers to guide us. As Psychedelic Stock Watch has frequently reported, mental health conditions like depression, addiction and PTSD are generating astronomical costs to the global economy in lost productivity alone.

By 2018, it’s estimated that these conditions were already costing the global economy $1 trillion per year in lost productivity. The Lancet Commission estimates that between now and 2030, costs in lost productivity will reach $16 trillion.

The estimate by MAPS of a cost savings of (on average) $103,000 per patient is just with respect to the out-of-pocket treatment costs. The massive potential economic benefits of restoring the productivity of these patients is an additional bonus.

Psychedelic drug market fundamentals now appear exceptionally strong

Even if psychedelic drug therapies required more spending than existing treatment options in terms of out-of-pocket treatment costs, these drugs may have still been able to deliver net long-term economic benefits, for reasons already given.

The spectre of $16 trillion in lost productivity due to stress-related mental health disorders like depression, anxiety, addiction and PTSD looms on the horizon. Psychedelic drug therapies can dramatically reduce this economic burden by restoring the productivity of many of the 1 billion sufferers of these disorders.

Now, via MAPS, we have evidence that psychedelic drugs offer front-loaded savings for the Mental Health Crisis as well, due to lower treatment costs. The economics of psychedelic drug-based therapies have instantly gotten stronger.

And there is also the potential for a dramatic improvement in quality of life for up to one billion people.

Psychedelic drugs: good medicine, good economics.

Psychedelic drug stocks: a great investment opportunity.