Cybin (CYBN), a medical research company, focuses on psychedelic therapies for the treatment and prevention of psychiatric disorders.

Its main business is novel drug discovery, proprietary drug formulation and delivery, as well as novel treatments. (See Analysts’ Top Stocks on TipRanks)

Cybin has developed novel psychedelic treatment methods for four different psychiatric conditions. The first of these is currently in Phase 2 clinical studies on humans. Patents have been granted to the company for both its psychedelic compounds and their applications. The company is self-sustaining, though it does not earn any income. The company has established partnerships to complete its clinical research and bring drugs to market.

There is high investor sentiment over the potential for success with the company’s research. Since the stock’s recent NYSE listing was not in the upward trend, I am neutral.

Highly effective psychedelic treatments

Four drug programs are currently being created by the company for treatment of anxiety, depression, and alcoholism.

Cybin contains more than 50 unique molecules that are derived from DMT, MDMA and other psychedelic compounds. Pre-clinical trials have been completed and the company is now moving towards human research. It has applied for fourteen patents to protect its new psychedelic substances, treatment and delivery methods and innovative drug discovery techniques.

This company is working to increase the bioavailability and effectiveness of psychedelic substances and create an ingestion technique that delivers quicker and more lasting effects. It is currently working to improve the management of psychotic disorders with the new drugs.

Cybin is currently working with an array of psychedelic chemicals that have been shown to be effective in treating these mental disorders. A Phase 2 approved clinical trial is being conducted by Cybin to assess the efficacy of sublingual pisilocybin in treating depression among patients.

This study will have 120 participants. It is randomized and double blind. It is expected to last for twelve months with additional follow-up sessions. Based on past research, the company anticipates similar results. Some patients may not experience symptoms anymore after treatment.

Cybin is able to accelerate its clinical research through partnerships. Recently, Cybin formed a partnership of TMS NeuroHealth Centers with Greenbrook TMS (GBNH). Cybin will benefit from NeuroHealth’s 129 outpatient mental health facilities in the United States.

Recent partnerships were also made by Cybin. Cybin signed an agreement to Catalent’s oral dosing technology in exchange for enhanced delivery and greater effectiveness. Cybin has a partnership with Kernel to use the company’s neuroimaging technology whereby one can monitor brain activity in real time during psychedelic experiences.

Cybin also plans to expand its European research partnerships, and patents its innovative drugs and treatments.

Cybin Raises C$120M

According to its Q1 2021 quarterly report, cash and equivalents had been reported at C$55.1 millions. The company reported a loss net of C$14.7 millions and operating expenses quarterly of C$9.1million.

Cybin was able to raise C$120 million through its market offer and is looking for additional financing. As it stands, the company’s assets outweigh its liabilities, but the question remains whether there is enough capital to ultimately finish trials and bring drugs to market.

Risques

Company does not have any revenue and has no estimates on how much it will cost to bring a treatment to the market.

When the company has negative research results, the stock price can drop and the overall valuation may also fall.

Wall Street’s Take

Wall Street rates Cybin as a Strong Buy following five Buys in the last three months. Cybin’s average price target of $8.25 implies a 289.2% upside possibility.

Conclusion

Investors should be optimistic about the chances of the company achieving a successful conclusion to its trials.

Disclosure: Cybin shares were owned by Alan Sumler at the time this article was published.

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