Atai Life SciencesPeter Thiel-backed company Psychedelic Drugs for Mental Health has bought more shares in a fellow drug developer Compass Pathways.

Atai recently bought 420,000 Compass Pathways stock shares, increasing its stake from 19.4% down to 20.8%.

Atai spent approximately $12 million total to buy the new shares. Each share was purchased at $31 per unit.

Atai, already the biggest Compass Pathways shareholder is expected to raise its stake to around 29% over the next weeks according to an insider who preferred not to be identified because the conversations are confidential.

Christian Angermayer (founder and Chairman of Atai) told CNBC Monday that Compass Pathways is one the most undervalued but impactful biotech stocks.

Compass PathwaysThiel also invested in it. Thiel wants to help depression with psilocybin, the compound found in magic mushrooms. It was launched on the NasdaqStock exchange in September, with a market capitalization of $1.4billion.

Atai was listed on Nasdaq’s June listing, raising $225m at an estimated $2.3billion valuation. The stock immediately poppedIt was 40%, but has now halved its value. Atai’s market capital is currently $1.7 billion.

Atai describes itself as a “drug development platform”. It is designed to incubate, develop and acquire psychedelics, and other drugs, that could be used to treat anxiety, depression and addiction.

Certain psychedelics are gaining popularity after recent events clinical studies suggested that some could help patients with a number of mental illnesses, either in combination with traditional solutions or in cases where nothing else has worked.

“The most current treatments [for mental health issues]Which are available there are certainly not enough,” co-founder Angermayer of the company stated to CNBC in an earlier interview.

They don’t always work, and some people do benefit from them. But they are not enough.

The World Health Organization estimates that nearly a billion people are affected by mental illness worldwide.