Psychedelic Policy & Law in 2022

Psychedelic drug policy reform initiatives continued to accelerate in 2022, with North America remaining the most active locale for such efforts. Given the fast-paced nature of such changes, this section briefly reviews a number of key initiatives and themes across the U.S., Canada and Europe.

Part of our Year in Review series

The United States

In December 2022, an article published in JAMA projected that a majority of states will legalise psychedelics by around 2034-2037. While the model used by the researchers placed a lot of credence in the idea that psychedelic drug policy reform will follow a similar temporal and geographic trajectory as marijuana reforms did, it’s nonetheless reflective of a broader feeling that psychedelic drug policy reform is predestined; at least in a majority of the fifty states.

As we noted in a November Bulletin, the state-by-state medical and recreational marijuana timeline does demonstrate some translational utility: California, Oregon and DC, for example, were among the first states to pass medical marijuana legislation in the mid-to-late 1990s. Today, they’re hotbeds of psychedelic drug policy reform initiatives; and successes.

Here, we look at two of the most substantive state-level initiatives that emerged or progressed in 2022, before turning to nascent efforts at the federal level. We then review some themes in psychedelic drug policy reform as well as other legal matters such as litigation and increasing scrutiny of ketamine clinics.

Colorado’s Natural Medicine Health Act Wins Voter Approval

In November 2022, Colorado became the second state to vote for the implementation of a legal psilocybin services program when voters endorsed Proposition 122, the Natural Medicine Health Act (NMHA). Arguably the most substantive psychedelic policy reform measure passed in the U.S. to date, the NMHA creates a state-regulated supervised psilocybin therapy program that should be ready for 2024, and decriminalises a number of psychedelics.

It was a tense run-up to the elections for proponents and opponents of the Proposition alike, with a poll conducted in the last week of October suggesting a very close call. And close it was:

Colorado Prop 122 Results

Now, NMHA’s advisory board will stew over the nuts and bolts of the program’s implementation for 18 months.

Oregon’s Psilocybin Services Face a Challenging Start

Oregon’s efforts to establish a regulated Psilocybin Services program by the beginning of 2023 reached a crescendo in 2022, as the realities of the undertaking became apparent to insiders and observers alike.

The most basic of these realities is the ability of Oregon Psilocybin Services (OPS) – the dedicated section housed within the Oregon Health Authority (OHA) to oversee the implementation of the psilocybin services program endorsed by voters in Measure 109 – to remain financially solvent. Once psilocybin services are up-and-running in 2023, the section appeared to have expected to sustain itself via a fee-based budget (i.e., license fees paid by service providers and associated taxes on psilocybin).

But, late in 2022, OPS felt compelled to request additional state general funds (around $6.6 million) to sustain its work through 2023, bridging an anticipated shortfall in funding. Given that the licensing fees are already substantial ($10,000 per year for service centres, manufacturers, and testing labs; $2,000 per year for facilitators), OPS presumably felt that it was not possible to increase them further.

OPS told Psychedelic Alpha that, for the 2023-25 biennium, it has estimated the following number of licensees:

  • Facilitators: 750
  • Service Centers: 28
  • Manufacturers: 26
  • Testing Labs: 13

Even if these lofty targets are reached (all signs point to the contrary, at present), it still leaves OPS in a precarious situation and a present shortfall.

To be sure, it’s standard procedure for state agencies to request funds from state governments, with Oregon Health Authority reporting around 50 policy packages in its 2023-25 requests. Nevertheless, it will be interesting to see if and when OPS becomes self-sustaining in the future; as the original Measure had suggested to voters.

New efforts to implement Oregon-esque regulated access programs will likely seek to learn from the Beaver state’s self-imposed restrictions. Colorado, for example, will allow its program’s funds to come from a broader range of sources, including donations and grants1.

Another political reality was rural Oregon’s distaste for psilocybin services, which manifested via an Opt-Out option baked into Measure 109, which allows for local jurisdictions to opt-out of allowing psilocybin services within their borders.

During the November 8, 2022 elections, many Oregonians used this option, with large swathes of Oregon’s landmass turning red on our dedicated Opt-Out Tracker produced in collaboration with Emerge Law Group, Calyx Law, and Healing Advocacy Fund.

Circles represent cities, conforming to the same color-coding as counties.

But, as we explained prior to the elections2, when viewed through the lens of population density the situation is less concerning for proponents of psilocybin services in Oregon.

Take the five most populous counties in Oregon, for example. At the time of our reporting in late August, just two of them put opt-out ordinances on the ballot:

Oregon most populous counties

Indeed, both Clackamas and Marion opted-out in the November elections.

With a combined population of around 2.5 million, these five counties alone represent just over 60% of Oregonians. The seven Eastern-most counties – all of which are staunchly Republican, rural, and have low population densities – all voted to opt-out. But, despite representing around a third of the landmass of Oregon, they represent a combined population of around 175,000 people: just over a fifth of Multnomah.

As such, our map is visually quite misleading in showing such large swathes of red, or counties and cities that ‘Opted-Out’ in November 2022. If we adjusted the size of counties on the map by their population, the picture would be much different.

This point was picked up by The Oregonian’s coverage, which noted:

“A map from Psychedelic Alpha shows where opt-outs passed. While it shows nearly two-thirds of the state will not allow psilocybin centers and manufacturing, the places where the majority of Oregon’s population live, the Portland metro area and the majority of the Willamette Valley, are all opted-in.”

It’s even more misleading when you take into account the fact that city land is subject to city regulation: it is only unincorporated land outside of city limits that is subject to county control. As such, cities within opt-out counties could choose to remain opted in, and become ‘safe haven’ cities. These are represented as green blobs amidst red counties on the map.

The population of these cities is often substantial, meaning that even in counties like Clackamas and Marion, the most populated cities like Portland and Salem, respectively, are “safe haven” cities for Oregon Psilocybin Services (i.e., they’re not opted-out).

Such is the importance of delving deeper into the data.

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As we noted in the days after the elections, there are also a few other points to keep in mind:

  • Not all of these opt-outs are permanent; some are temporary moratoriums.
  • Public education and engagement appears to work: voters in Deschutes County convincingly rejected the opt-out ordinance. Deschutes was home to one of a handful of campaign groups formed specifically to oppose opt-outs. On this point Sam Chapman, Executive Director of the Healing Advocacy Fund, told Psychedelic Alpha that this shows that “when people hear about the potential of psilocybin therapy from their own community members, they understand why it’s important”.
  • It’s important to appreciate the equity and access implications of the new geography of psilocybin services in Oregon.

If Oregon’s psilocybin program proves to be a success, there’s no reason that wider adoption won’t emerge among the presently ‘opted-out’ counties. Fluence’s Victor Cabral told us that, “the hope is that over time, successful implementation and improvement of the Measure 109 program in counties that opt-in will lead to wider adoption across the state.” Chapman agreed, predicting that “as the therapy gets implemented in Oregon communities in 2023 and beyond, voters will continue to learn about how it can help address our state’s mental health crisis, and over time access will only continue to expand.”

Beyond these more existential threats to OPS and the local contours of psilocybin services availability, there are a bevy of logistical issues that would-be psilocybin service centres and other operators are facing.

Harris Bricken’s Vince Sliwoski has been covering these challenges via the firm’s Psychedelics Law Blog, and identifies his ‘top five’ challenges as:

  1. “The lack of a retail sales or an off-site use allowance, to supplement the on-site, supported adult use model
  2. The high cost of licensing for facilitators in particular (up to $8K for certification, plus $2K in OHA fees annually)
  3. The length of administration sessions, which can be six hours minimum at the highest doses (and not reimbursable by insurance)
  4. The decision by 137 towns and counties to opt out of psilocybin services
  5. Intractable issues caused by federal prohibition, especially around taxation and lack of banking”

These more mundane issues, which also include zoning and land use rules, will likely further slow or stunt the establishment of psilocybin services in Oregon.

Federal Psychedelic Drug Policy Reform Efforts Emerge

To date, many psychedelic drug policy reform efforts have taken place at the local or state level. However, 2022 saw the emergence of a number of efforts pushing for psychedelic policy reform at the federal level, with varying degrees of coordination. In brief, these include:

  • Federal Task Force: In May, a letter from Assistant Secretary of Health and Human Services for Mental Health and Substance Use Miriam E. Delphin-Rittmon to Representative Madeleine Dean explained that SAMHSA is, “exploring the prospect of establishing a Federal Task Force to monitor and address numerous complex issues associated with emerging substances”, with reference to psilocybin and MDMA. Psychedelic Alpha understands that the establishment of such a Task Force is underway, with the involvement of groups like Reason for Hope and The Veterans Mental Health Coalition (VMHC).
  • Breakthrough Therapies Act: Introduced by Cory Booker and Rand Paul, this bipartisan effort would reduce barriers to psychedelic research and access3. We provided further details in our December analysis of the act.
  • NDAA amendments: In perhaps the most bipartisan pairing of representatives possible4, Dan Crenshaw and Alexandria Ocasio-Cortez forwarded amendments to the National Defense Authorization Act (NDAA) for 2023, which would modestly reduce federal restrictions on certain psychedelic research. The House of Representatives adopted the amendments, which were likely more of a political win than a substantive one. Our commentary from July provides more colour.
  • The Congressional Psychedelics Advancing Clinical Treatments (PACT) Caucus: with involvement from a wide array of groups, this new congressional caucus has been celebrated by the likes of MAPS. Its goals include increasing awareness of PATs among members of congress and their staffs, supporting increased federal funding for psychedelic science, and examining regulatory impediments to psychedelic research. The Caucus will not offer recommendations on the decrim., legalisation, or re/de-scheduling of psychedelics.

Other Themes in U.S. Psychedelic Policy and Law in 2022

Local Decriminalisation Efforts Continue

  • As you can see from the non-exhaustive timeline at the very bottom of this webpage, a number of decriminalisation efforts made headway in 2022.
  • Take California, for example. While a state-wide psychedelic decrim. effort was resuscitated in late 2022, local decriminalisation efforts continued in the Golden State, with San Francisco passing something akin to decriminalisation of psychedelics (though, not exactly) and the city of Berkeley looking to decriminalise a number of psychedelics (including LSD) via a resolution that passed the Berkeley Health Commission in late 2022.

At-Home Ketamine Comes Under Scrutiny

  • As a COVID-era waiver to the Ryan Haight Act allowing remote prescribing of scheduled substances looks set to sunset in 2023, where does this leave ketamine telehealth companies? When viewed in the context of a growing number of unfavourable media reports of these at-home ketamine offerings, some companies are bracing for impact.
  • As we covered in May 2022, the fate of San Francisco-based mental health startup, Cerebral, may be a canary in the coalmine5. The company, which became known for prescribing Adderall (a Schedule II substance) without in-person consultations, is under investigation by the U.S. Department of Justice for potential violations of the Controlled Substances Act.

Psychedelics-Related Litigation Ramps Up

In 2022, we saw a number of psychedelics-related litigation headlines. While it’s still a small crop, it’s interesting to see a variety of cases emerge, from inter-company complaints right through to challenges to the DEA. Here are a handful of examples:

  • DEA Ditches Plan to Schedule 5 Tryptamines: In the Summer of 2022, the DEA scrapped a proposal to place five tryptamines on Schedule I after a group of researchers, psychedelic startups and lawyers challenged the agency. We sifted through around two hundred documents related to the case to produce our most in-depth Special Report of 2022, Inside the Challenge to DEA’s Proposed Scheduling of 5 Psychedelic Tryptamines.
  • DOI and DOC Escape Scheduling: Later in 2022, the DEA backpedalled on another attempt to schedule psychedelics. While both instances of the DEA bowing to public pressure and legal challenges are promising, many expect the agency to return with fresh plans to schedule such substances.
  • Terran Biosciences files lawsuit alleging that COMPASS “milked” researcher for trade secrets before “secretly” filing patent on same technology: This complaint, which is understood to constitute the first trade secret lawsuit in the psychedelics space, was filed on the 5th of August, 2022. We covered it in an August Bulletin.
  • Two Post-Grant Reviews Denied: In June, COMPASS Pathways survived two challenges to its Polymorph A patents, which are understood to cover its crystalline forms of psilocybin including COMP360. The challenges were brought by Freedom to Operate, a non-profit group founded by Carey Turnbull dedicated to “protecting psychedelic science and medical development for public benefit”. At the time we described this as, “an unreserved win for COMPASS”, explaining that the Patent Trial and Appeal Board (PTAB) had sided with the company on both of the claim constructions, finding each of FTO’s invalidity arguments unsupported and unpersuasive. Requests for rehearing and further review, filed in July and August, remain pending.
  • AIMS v. DEA: see Kathryn Tucker’s description of events. Though, as with all contributions to this Review series, do note that new developments may have emerged since the time the contribution was authored.

AIMS v. DEA: Advocating for Open Access to Psilocybin Assisted Therapy

Kathryn Tucker, Emerge Law Group

The Emerging Role of the VA

  • Given the politically and culturally salient nature of veterans in the U.S., it’s unsurprising that many policy reform and advocacy efforts are foregrounding the plight of many in this community. In October, the Department of Veterans Affairs published an Evidence Brief, Psychedelic Medications for Mental Health and Substance Use Disorders. “Evidence is therefore very preliminary and several critical gaps need to be addressed by future research”, the report concludes.

Canada

Canada has been a hotbed for psychedelic business and advocacy for a number of years, from its Special Access Program amendments through to successful localised efforts in the (psychedelic) drug policy reform arena. Here, we look at a handful of developments from 2022.

Special Access Program (SAP) Amendments Provides Very Modest Access to PATs

Near the end of December 2020, Canada’s leading health agency, Health Canada, notified the general public of its intent to pursue regulatory amendments which would restore access to “restricted drugs”6 through the agency’s Special Access Program (SAP). Over the course of a two-month public consultation period, Health Canada received 392 responses from individuals and organisations. Interestingly, expanded access to psychedelics was a leading theme in responses gathered by Health Canada. As the agency described:

 “80% of all respondents associated Health Canada’s proposal with increasing access to psychedelic restricted drugs (e.g. MDMA, psilocybin, LSD, DMT), often for the treatment of various conditions, most notably mental health disorders.”

On January 5, 2022, Health Canada’s amendments were announced, allowing the Minister of Health to authorise, “the sale of an unapproved drug from a manufacturer to a practitioner for the emergency treatment of a patient under certain circumstances.” However, SAP requests for psychedelics are limited to only psilocybin and MDMA (Pazdan & Goldgrub, 2022).

In its Gazette notice, Health Canada noted how many public consultation respondents erroneously believed that these regulatory changes would allow for a, “guaranteed access to psychedelic restricted drugs.”  In light of these frequent misinterpretations, the agency emphasised that its amendments would not support such widespread access to restricted drugs, nor should they be interpreted as an indication of Health Canada’s desire to move towards broader decriminalisation or legalisation.

Instead, access requests are to be submitted on behalf of qualifying patients by eligible practitioners through the SAP. Submitted requests will be considered “on a case-by-case basis” and, in doing so, the agency will take into account the existing body of clinical evidence that supports the use of the drug(s) for a patient’s condition. Interestingly, Health Canada described how requests “are normally only considered when positive results of Phase II or Phase III clinical trials are already available.”

Furthermore, as Pazdan & Goldgrub (2022) explain:

“SAP requests, however, will only be granted for patients with a ‘serious or life-threatening condition’ in cases where other conventional treatments have failed, are unsuitable for the patient, or are not available in Canada.”

Prior to Health Canada’s recent SAP amendments, patients hoping to access psychedelics required the Minister of Health to grant an exemption to the Controlled Drugs and Substances Act (CDSA) under Section 56 of the act. While dozens of patients have successfully gained access to psilocybin using the section 56 exemption pathway, wait times can be notoriously long. Furthermore, patients granted these exemptions are required to source their own drugs.

Conversely, patients who obtain access to psilocybin or MDMA using the recently-amended SAP are not required to source their own supply. Instead, Health Canada-approved dealers provide their manufactured drugs to the patient’s health care provider.

While the new process was widely viewed as a step in the right direction, shortly after the amendments came into effect applicants, many of whom had sought access exemptions through the section 56 pathway, began to have their applications denied by Health Canada.

In one such case, Health Canada informed a patient that they “had not exhausted all possible legal routes available” to obtain access to psilocybin, and as a result were not being approved for an exemption under section 56 of the CDSA. In fact, as a CBC article published on February 28, 2022 described, zero section 56 exemptions had been granted since psilocybin was added to the SAP list earlier in 2022.

Thus, it appears that in the eyes of Health Canada patients seeking medical access to certain psychedelics should first apply through the amended SAP, and rely on section 56 of the CDSA as a secondary option.

However, these rejections applied not only to patients seeking medical access, but also to health care providers who sought section 56 exemptions to access psilocybin for training reasons. In fact, near the beginning of 2022, Health Canada rejected the applications of roughly 80 Canadian healthcare professionals. In response, Health Canada suggested that practitioners interested in training should do so by participating in an approved clinical trial.

These rejections and limits on access to psychedelics prompted seven patients and one practitioner to file a lawsuit against the Canadian Government and Minister of Health. The plaintiffs, with support from TheraPsil, are “arguing for a constitutional right to individualised psilocybin-assisted therapy” (Pazdan & Goldgrub, 2022).

The charter challenge cites a number of important deficiencies (prohibitions) that unjustly limit existing options available to patients and providers who wish to access psilocybin. Accordingly, the group claims that the prohibitions referenced in their challenge violate section 7 of the Canadian Charter of Rights and Freedoms, which guarantees “the right to life, liberty and security of the person”.

As Pazdan & Goldgrub (2022) describe in their review of Canadian psychedelic law, the challenge does not appear to be without strong precedent:

“The patients’ argument is a strong one, clearly echoing that of the successful 2000 Parker case. In Parker, the Ontario Court of Appeal held that the law broadly prohibiting access to medical cannabis violated the epileptic plaintiff’s Charter rights. Notably, the court regarded the possibility of the plaintiff accessing medical cannabis by means of s. 56 exemption as insufficient to save the government’s legal stance. As a remedy, the court mandated that the federal government create Canada’s first regulated, individualized medical cannabis regime within a year.”

As we move further into 2023, it will be interesting to see how this Charter challenge unfolds, and whether it might have broad impacts on medical access to psilocybin in Canada.

While the amended SAP certainly failed to meet the needs or expectations of many, on March 21, 2022, Health Canada authorised Dr. Valorie Masuda to treat six patients for their end-of-life distress using psilocybin. Subsequently, in May 2022, Numinus Wellness and Braxia Scientific both announced that they had received SAP approval from Health Canada to treat patients suffering from depressive disorders using psilocybin.

More positive news emerged near the end of the year, when TheraPsil announced that two physicians had successfully billed for and were paid by the province of Quebec “after completing psilocybin-assisted psychotherapy for a patient with legal access”, making the province of Quebec the first to cover the costs of psilocybin-assisted therapy.

Alberta Becomes the First Province to Regulate PATs

On October 5, 2022 the government of Alberta announced that it wou