Peter Thiel-backed Atai snaps up Compass Pathways shares

Atai Life Sciences, the Peter Thiel-backed start-up that wishes to make use of psychedelic medication to deal with psychological well being situations, has elevated its stake in fellow drug developer Compass Pathways.

Atai purchased one other 420,000 Compass Pathways shares in current days, taking its stake within the firm from 19.4% to twenty.8%.

The brand new shares have been purchased at round $31 every and Atai paid round $12 million in complete.

Atai, which is already the biggest Compass Pathways shareholder, is planning to extend its stake in Compass Pathways to extra like 29% within the coming weeks, in accordance with a supply near the businesses who most popular to stay nameless because the discussions are personal.

Christian Angermayer, the founder and chairman of Atai, informed CNBC Monday that he believes Compass Pathways is among the most undervalued and impactful biotech shares.

Compass Pathways, which Thiel has additionally invested in, needs to make use of psilocybin (the compound present in magic mushrooms) to deal with despair. It debuted on the Nasdaq inventory trade final September and it has a present market worth of $1.4 billion.

In the meantime, Atai listed on the Nasdaq in June, elevating $225 million at a valuation of $2.3 billion. The inventory instantly popped 40% however it has since halved in worth and Atai’s present market cap is $1.7 billion.

Atai, which describes itself as a drug growth platform, was set as much as purchase, incubate and develop psychedelics and different medication that can be utilized to deal with despair, nervousness, dependancy and different psychological well being situations.

There may be rising curiosity in sure psychedelics after current scientific research recommended that some may assist sufferers with various psychological sicknesses, both together with conventional options or in instances the place nothing else has labored.

“The present therapies [for mental health issues] that are on the market are undoubtedly not adequate,” firm co-founder Angermayer informed CNBC in a earlier interview.

“I do not need to say they do not work in any respect as a result of some persons are helped by them, however they don’t seem to be adequate.”

Nearly a billion individuals endure from psychological well being issues worldwide, in accordance with the World Well being Group.