Tryp Therapeuatics (TRYPF) Coverage Report

3. A renaissance in clinical research sparks drug developers’ enthusiasm. Research into psychedelics as therapeutics is undergoing a renaissance period due to the release of positive clinical data supporting therapeutic utility, a frustrating yet enduring unmet need across numerous neurological disorders, a corresponding interest from the biotech industry and a partnered enthusiasm from investors. As described below, this is being sparked by a depth in understanding neural brain networks and communication, along with the tools to understand how psychedelics are forcing a disconnect between memories and their respective emotions. Psychedelic drugs have been used for thousands of years for spiritual and religious purposes. While the history does not dictate that every psychedelic company will successfully develop an FDA approved treatment, in our view the history of psychedelics does favor the outcome for the industry as a whole. In the body of our initiation, we review the historical use, the early-modern research in the 1960’s, and the recent surge of the identification of neural networks affected by psychedelics. We find that the future of psychedelics in prescription medicine rests largely on three drivers: i. First, the combination of KOLs, companies and investors’ collective views for the potential returns in this renewed industry. So far, in our view, there is very strong and growing sentiment towards psychedelics. ii. Second, is regulators’ appreciation and willingness to reconsider (as it has in other conditions) its established development and approval benchmarks to allow a category of medicines that can reset the neurological connections between emotions and memories. iii. And third, which in many ways drives the first two, we find the outlook for the commercialization of psychedelics as prescription medicines will likely rest on social media and societies’ willingness to accept a class of medicines that was banned ~50 years ago, with a reputation for “dropouts” or those that want to “drop out”. Supportive of these three drivers into the outlook for psychedelics is a widespread appreciation that today’s treatments are inadequate for large conditions, including depression, and smaller conditions like posttraumatic stress disorder (PTSD) and phantom limb pain (PLP). From our research into societies’ acceptance of CBD, we believe the acceptance of psychedelics as mainstream medical treatments will support the clinical, investment and regulatory approvals needed so psychedelics can become accepted medical practice, especially when superior to today’s treatments. 4. You are not hallucinating--there are numerous signs of psychedelic’s return. In the investment community, psychedelics are becoming mainstream, as evidenced by almost 40 publicly traded psychedelic-focused companies and ETFs, including NEO.PSYK and the NYSE’s PSY. We find investors’ interest is supported by an increasing base of clinical evidence from recent, well-conducted trials at leading academic institutions, following years of investment from academics, some government funding, as well as non-profit institutions (CNS Drugs (2020) 34:925–946). A generation ago, large pharma’s began to reduce investment in mental health companies, which we attribute to the limitations of science over market need. While SSRI’s and SNRI’s were considered revolutionary at the time, over time their limitations Michael Higgins 212.409.2074 Tryp Therapeutics, Inc. (TRYPF) Page 6