Radically different
It wasn’t too long ago that biopharma giants stayed away from developing psychedelic drugs—but positive clinical data plus a friendlier regulatory climate in Washington have prompted the largest drug developers to embrace the field.
The latest and most telling example of pharma embracing psych drugs came when Eli Lilly (NYSE: LLY) announced that it agreed to acquire AtaiBeckley (Nasdaq: ATAI) for up to $3.8 billion—of which Lilly will pay $2.8 billion upfront. The deal, set to close in the third quarter, expands Lilly’s neuroscience portfolio by adding the pipeline of AtaiBeckley led by BPL-003 (mebufotenin benzoate), a Phase III candidate for treatment-resistant depression (TRD) that is a synthetic form of 5-MeO-DMT administered intranasally. BPL-003 has been granted the FDA’s Breakthrough Therapy designation.
BPL-003 wowed analysts and others back in April after AtaiBeckley published positive data from a Phase IIa trial (NCT05660642) showing that a single intranasal dose of BPL-003 led to rapid and sustained reductions in Montgomery-Åsberg Depression Rating Scale (MADRS) scores from baseline in 12 TRD patients who remained on stable SSRI therapy throughout the study. Both the six patients dosed at 10 mg and six at 12 mg showed a 66.7% antidepressant response rate (defined as ≥50% reduction from baseline MADRS score) at Day 2, with five of six participants in the 10 mg cohort (83%) and four of six in the 12 mg cohort (66.7%) maintaining their response at Week 12.
“Especially with progress on BPL-003, we see the company as positioning itself well to becoming a significant player in the mental health therapeutics space,” Sumant Kulkarni, a senior analyst covering biotechnology with Canaccord Genuity, wrote on news of the positive data, adding: “We also still see this space as large enough to accommodate multiple approaches/competitors.”
Kulkarni also raised Canaccord Genuity’s peak unadjusted U.S. sales forecast for BPL-003 to $3.7 billion by 2036 from $2 billion, after revising the firm’s model by raising the list price from $20,000 to $30,000 per annual treatment course (not accounting for insurance coverage), about the same price as Spravato® (esketamine), also a nasal spray marketed by Johnson & Johnson (NYSE: JNJ) for TRD plus some depressive symptoms in adults with major depressive disorder (MDD).
Spravato, a noncompetitive N-methyl D-aspartate (NMDA) receptor antagonist, crossed the $1 billion sales threshold during the second quarter, as it generated $584 million, up 25% quarter-over-quarter from $464 million in Q1—and up 43% from $734 million in the first half of 2025.
“Sales are tracking to reach annual sales guidance of $3-3.5B+ by 2027–28,” Jefferies equity analyst Andrew Tsai wrote in a research note focused on J&J’s second-quarter results. “Spravato’s trajectory supports the notion psychedelics can be commercially viable in hard-to-treat mental health disorders, by leveraging JNJ’s infrastructure.”
Given the data for BPL-003, Lilly got a bargain, Tsai wrote in a separate note on the Lilly-AtaiBeckley acquisition.
“We think the deal heavily favors LLY, as ATAI’s lead asset BPL-003 (intranasal 5-MeO-DMT) should have multibillion dollar peak sales potential,” Tsai wrote, rather than the $1 billion-plus that he thinks was implied by the deal price.
Tsai and Jefferies had previously forecast peak sales of between $1 billion and $2 billion—a range he said was “arguably conservative” since BPL-003 could, if it aces its Phase III trial, show superiority to Spravato, which is on track to reach up to $5 billion-plus in peak sales.
“At the same time, we appreciate LLY has significantly more resources to maximize the long-term value of ATAI’s psychedelic assets. In any case, the deal has (+) [positive] implications for the entire psychedelic space,” Tsai added.
Among pharma giants joining J&J in embracing psychedelic drug development in recent years:
With its deal for AtaiBeckley, Lilly becomes the latest pharma giant to perceive the positive implications Tsai cited.
“Treatment-resistant depression persists even after multiple treatments have failed. Millions of people are still searching for relief and desperately need a therapy that works,” Carole Ho, executive vice president and president, Lilly Neuroscience, said in a statement. “Advancing AtaiBeckley’s investigational therapies gives us a real chance to change that.”
Investors agreed with Lilly, giving the pharma a 1% increase Thursday, the day the acquisition was announced, from $1,156.63 to $1,169.17—no small feat since buyers typically stay flat or see their shares slide after announcing an acquisition. And not surprisingly, AtaiBeckley investors were enthusiastic about the deal, as its stock leaped 33% from $5.36 to $7.15. On Friday, Lilly inched up 0.8% to $1,178.58 while AtaiBeckley rose 1% to $7.22.
The AtaiBeckley buyout is Lilly’s eighth announced acquisition of a smaller biopharma this year.
Lilly is acquiring three infectious diseases vaccine developers—Vaccine Company for up to $1.55 billion, Curevo for up to $1.5 billion, and LimmaTech Biologics for up to $780 million—as well as in vivo chimeric antigen receptor T-cell (CAR T) developer Kelonia Therapeutics for up to $7 billion); JAK inhibitor developer Ajax Therapeutics for up to $2.3 billion; next-generation dual-payload antibody-drug conjugate (ADC) developer CrossBridge Bio for up to $300 million; and nonviral DNA delivery-focused drug developer Engage Biologics for up to $202 million cash.
The deal spree reflects Lilly’s desire to capitalize on the billions of dollars it is generating from sales of its obesity and diabetes drugs based on glucagon-like peptide 1 (GLP-1) receptor agonists alone or in tandem with a glucose-dependent insulinotropic polypeptide (GIP).
“If we see great ideas that we think we can use to help people that need them, of course we’ll do deals,” Daniel M. Skovronsky, MD, PhD, Lilly’s chief scientific and product officer and president of Lilly Research Laboratories, said on CNBC.
David Risinger, a senior managing director and senior research analyst covering diversified biopharmaceuticals at Leerink Partners, said his firm viewed Lilly’s buyout of AtaiBeckley “as a positive development because it enhances LLY’s pipeline of potential neuroscience blockbuster candidates.”
That pipeline is led by five Phase III programs involving four drugs, none of them a psychedelic. Two of the programs belong to brenipatide, a dual agonist of both the GIP and GLP-1 receptors. Brenipatide is being developed for both MDD and alcohol use disorder.
Also in Lilly’s late-stage neuroscience pipeline are:
In addition, AtaiBeckley “would provide differentiated exposure in psychiatry and reinforce [Lilly’s] broader effort to diversify beyond its cornerstone cardiometabolic franchise,” observed Evan David Seigerman, a managing director and head of healthcare research at BMO Capital Markets, as reported by Reuters.
AtaiBeckley was formed last November by the merger of atai Life Sciences and Beckley Psytech. The company’s stock has nearly doubled, soaring 98% over the past six months from $3.64 on January 16.
“Psychedelic Medicine is going mainstream,” declared Steve Jurvetson, co-founder of Future Ventures, in a post on X. Jurvetson and Future were among early investors, along with Peter Thiel in atai Life Sciences.
AtaiBeckley is one of numerous psychedelic drug developers to show significant six-month gains since January: As of Friday’s closing bell, Compass Pathways (Nasdaq: CMPS) shares jumped 68% to $12.35, GH Research ballooned 69% to $28.71, while Definium Therapeutics (Nasdaq: DFTX) nearly tripled, zooming 194% to $44.29.
Interestingly, those three companies did not get a solid bounce from AtaiBeckley’s acquisition by Lilly. Since the deal was announced Thursday, Compass fell 7% from $13.31 pre-announcement, Definium dipped 3% from $45.66. GH rose 8% Thursday from $26.92 to $29.13, before sliding 1.4% the following day.
Bucking the trend was Cybin, d/b/a Helus Pharma (Nasdaq: HELP), which has climbed 11% since the Lilly-AtaiBeckley announcement, from $6.51 to $7.25. Its shares have slumped 6% since January—but soared 58% over the past month on positive news, such as the 88%+ enrollment rate of patients in Helus’ Phase III APPROACH pivotal trial (NCT06564818) of HLP003 in MDD, on track for topline data readout in Q4 2026.
“We see the potential for 150–200% upside [jump in stock price] if Phase III data in 4Q26 are positive,” Kulkarni wrote, making it the largest potential jump among psychedelic drug developers.
In addition to favorable data, the stock surges also reflect actions by President Donald J. Trump’s administration to encourage psychedelic drug development. In April, President Trump signed Executive Order 14401, directing the FDA and other federal agencies to accelerate research and improve access to psychedelic drugs, citing their potential as promising treatments for serious mental illnesses.
And on July 13, the FDA published “Psychedelic Drugs: Considerations for Clinical Investigations,” a final guidance designed to provide general considerations for developers of psych drugs, with recommendations for how to conduct clinical trials for the treatments.
“Rather than providing specific recommendations on study design, this guidance will present foundational constructs that all sponsors studying the therapeutic potential of psychedelic drugs, including sponsors without commercial drug development as primary interest (e.g., academic researchers), should consider,” the FDA wrote in the final guidance. “Sponsors are encouraged to request meetings with FDA for advice on a specific drug development program.”
The post StockWatch: Lilly’s Up-to-$3.8B Deal for AtaiBeckley a Good Trip for Psychedelic Drugs, Analysts and Investors Agree appeared first on GEN – Genetic Engineering and Biotechnology News.
By Mai El Shoush, Partnership Campaign Manager, SNF Global Center for Child and Adolescent Mental Health at the Child Mind Institute
Few events unite the world quite like the FIFA World Cup, demonstrating soccer’s unique ability to connect people across cultures and communities. As millions tune in, the moment offers a timely reminder on how sports can reach young people far beyond the field. This belief underpins the work of Grassroot Soccer, a valued partner of the SNF Global Center for Child and Adolescent Mental Health at the Child Mind Institute. They utilize the power of soccer to advance youth mental health — and have reached more than 25 million young people around the world through this approach.
The partnership incorporates three interconnected areas:
The 2026 Men’s World Cup in North America and the upcoming 2027 Women’s World Cup in Brazil present an important opportunity for the organization to take its mental health programming from sub-Saharan Africa and adapt it to the U.S. context.
We spoke with Grassroot Soccer’s Mental Health Specialist Charmaine Nyakonda about the organization’s approach, the impact of their collaboration with SNF, and the growing role of sports in improving the mental health of young people and communities globally.
As international attention increasingly turns towards soccer’s global reach with the 2026 FIFA Men’s World Cup, what role can sports play in advancing youth mental health care across diverse communities?
Soccer is the most popular and accessible sport in the world. From the largest global stages like the World Cup to the most remote rural villages, it’s played everywhere on the planet. As the World Cup shows, soccer has the power to captivate across geographies, cultures, and time zones.
Soccer (and sport in general) is a powerful tool that teaches youth important life skills and character-building lessons like resiliency, hard work, courage, trust, and teamwork. On top of this, soccer’s universal appeal across diverse communities means using the language of the game can also be an effective way to break through the stigma around sensitive but pressing topics like mental health. This is why Grassroot Soccer uses soccer as a teaching tool for mental health.
Grassroot Soccer has successfully touched the lives of millions of young people across settings worldwide. What has the team learned about the universal role that sports can play in supporting mental health, resilience, and social connection?
Across our programs, soccer serves as a universal entry point that hooks young people and meets them where they are. From there, our play-based activities use soccer games and metaphors to make learning about mental health fun and engaging. They break down stigma and create safe spaces where young people can feel comfortable opening up and being vulnerable. This drives exceptional participation and completion rates.
Importantly, our signature soccer-based mental health promotion and prevention program, called MindSKILLZ, is guided by core mental health design principles. This includes grassroots co-creation, trauma-informed practice, relationship-centered delivery, and strengths-based learning — which ensures that programs are ethical, culturally grounded, and safe for adolescents in both stable and crisis-affected settings.
“Soccer (and sport in general) is a powerful tool that teaches youth important life skills and character-building lessons like resiliency, hard work, courage, trust, and teamwork.”
What elements of Grassroot Soccer’s approach do you believe could serve as a transferable blueprint for other organizations seeking to improve outcomes for young people in different sectors and communities?
Our commitment to co-design with young people: We believe that young people are the experts on their lives and needs, so we intentionally apply the principle of “Nothing about us without us” to our work. We put this into practice by engaging young people at every point in the program life cycle to ensure our work meets their needs, from design to implementation to evaluation.
In 2023, Grassroot Soccer officially launched a Youth Advisory Committee (YAC) composed of young leaders that serves as an internal advisory and advocacy body for the organization. The Committee consists of SKILLZ Coaches, Master Coaches, and trainers between the ages of 18 to 30 from the communities we serve.
Mental health integration: Mental health promotion and prevention must be woven into every service that young people access. Mental health is both a driver and an outcome of young people’s overall well-being. Unaddressed mental health challenges undermine progress in HIV, sexual and reproductive health, education, and other youth development areas. And those same factors profoundly shape young people’s mental health in return.
What has made the partnership with the SNF Global Center particularly valuable, and what role do cross-sector and multidisciplinary partnerships play in expanding support and opportunities for young people?
The diverse cultural perspectives from Greece, Brazil, the United States, and South Africa — and especially youth voices — have enriched our understanding of the barriers young people face, the values that motivate them, and the creative solutions they come up with when it comes to mental health.
We’ve also benefited tremendously from the scientific and clinical expertise at the SNF Global Center. We were able to co-develop an open-access, near-peer emotional support online training that aims to enhance the capacity of frontline workers to identify, refer, and support common mental health problems among children and adolescents. This is especially important in low-resource settings.
Additionally, through thought leadership and advocacy collaboration, this partnership has been valuable in contributing to an important shift in the global conversation to framing low-resource settings (the Global South) as sources of innovation that can positively impact the Global North.
Over the years, what has most reinforced your belief in the power of soccer to support youth mental health, and what examples best bring that impact to life?
We’ve seen a few powerful stories of impact in humanitarian settings, where the need for mental health care is at its greatest but resources are at its most limited.
For example, in 2024, relentless downpours following a tropical cyclone caused rivers in Malawi’s Nkhotakota and Karonga districts to overflow, leading to widespread flooding impacting over 150,000 people and forcing many displaced residents to seek refuge in makeshift internally displaced person (IDP) camps.
In the camps, people had no access to mental health and psychological support services or safe spaces, and youth were not attending school. The Malawi Ministry of Health identified a major gap in mental health support for adolescents and young people and called on Grassroot Soccer to deliver MindSKILLZ to respond to this need.
Grassroot Soccer’s response team focused heavily on play, coping skills development, and trauma-informed support, creating critical psychological and physical safe spaces for youth within the camp environment.
Looking ahead, how would you like to see the conversation evolve at the intersection of sports, youth well-being, and mental health?
Firstly, we would like to see the conversation move beyond asking whether adolescent girls and young women like to play sports and instead asking, “What can we unlock when they do?”
For too long, sports (and soccer in particular) have been understood as primarily a significant part of adolescent boys’ and young men’s lives only. That assumption has shaped who gets access, who feels welcome, and whose well-being is centered. Grassroot Soccer’s own programming challenges this directly — we have reached more adolescent girls than boys, and in doing so have created space for girls to reconstruct gendered ideas about soccer. The conversation on sports, youth, and mental health needs to evolve to view sports games like soccer as universal tools that can transcend gender norms, age, and socio-economic background to support young people.
At the same time, we want to see the conversation take adolescent boys’ mental health more seriously, not less. Qualitative insights from Grassroot Soccer show that rigid masculine norms remain a profound barrier for boys.
More broadly, we ultimately want to see the conversation shift from individual resilience to multi-systemic access and inclusive enabling environments. Young people need culturally grounded, safe environments that work for them — and include them in design and delivery to help them develop into healthy adults who carry that capacity forward.
What do you see as the greatest opportunities for the next generation of young people, and what must we do collectively to help make that future possible?
With the largest generation of adolescents coming of age, their ability to live healthy and productive lives will have a profound impact on not just their own life trajectories, but also on the world. Tackling critical global issues from poverty to climate change will require a generation of young people who are strong, healthy, and empowered — and their mental health is central to all this.
At Grassroot Soccer, we are committed to investing in youth mental health to realize a world where mental health challenges have been normalized. We want young people to understand their own mental health, have practical coping skills to deal with frustration and aggression, and recognize the value in seeking support from others. This will help develop a population with reduced symptoms of depression and anxiety, as well as overall improved mental well-being. Then we can collectively realize our vision for a better future.
Through the SNF Global Center, the Child Mind Institute partners with organizations around the world to strengthen child and adolescent mental health systems by combining scientific expertise, local leadership, evidence-based innovation and youth voices. Grassroot Soccer is one example of how cross-sector partnerships can expand access to mental health support in communities where young people already learn, connect, and thrive.
The post Playing the Long Game for Youth Mental Health: A conversation with Grassroot Soccer on the power of sport and partnership appeared first on Child Mind Institute.