See the pitch deck that Compass Pathways used to raise $80 million and fuel its rise into one of the world’s biggest psychedelics companies
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- Compass Pathways is one of the biggest psychedelics companies in the world.
- Its 2019 pitch deck tells the story of how the giant came to be what it is today.
- With this presentation, the company won over investors such as Otsuka and Founders Fund.
Today, psychedelics giant Compass Pathways has a market value of $1.5 billion.
But back in 2019, it was a small startup raising cash to turn psilocybin, the psychoactive compound found in magic mushrooms, into a treatment for treatment-resistant depression, or depression that doesn’t get better with other medications and remedies.
Insider got ahold of the company’s pitch deck from 2019, which Compass used to raise an $80 million Series B round from investors such as pharma giant Otsuka’s McQuade Center for Strategic Research and Development and Founders Fund, the venture-capital firm of which Peter Thiel is a cofounder.
In the fall of 2018, Compass closed a 25 million pound Series A round (around $33 million). Soon after, the company began to fundraise for its Series B, which closed in April 2020.
Compass was the first psychedelics company to get backing from institutional healthcare investors such as Otsuka. Mike Novogratz and Thiel’s venture firm Thiel Capital invested in the Series A, the presentation shows.
“Our goal remains the same: to bring evidence-based innovation to patients for whom existing treatments don’t work, in a way that is accessible and affordable,” said Tracy Cheung, a spokesperson for Compass. She said the company has made significant progress toward this goal since 2019.
Other investors in the Series B included Atai Life Sciences, which started out as a funding vehicle for the psychedelics space; Able Partners; Camden Partners Nexus; Perceptive Advisors; Skyviews Life Science; and Soleus Capital.
The presentation details Compass’ strategy and its timeline for getting treatments approved by the US Food and Drug Administration.
The growth the company has undergone since then has been immense. After the Series B, Compass became the first psychedelics company to list on the Nasdaq. It raised $312 million through its IPO and a 2021 follow-on offering. Last month it announced that it had finished mid-stage clinical trials, and it plans to publish results by year’s end.
The presentation tells the story of how the startup maneuvered to dominate what was once a fringe industry.
In 2019, Compass used this pitch deck to raise its Series B funding round.
Insider recently obtained a copy and is publishing it in full here.
The presentation outlined the opportunities for psilocybin-based medications and said Compass was targeting a multibillion-dollar opportunity.
The Compass of today is known for its multiple patent applications, which some in the industry have criticized as far-reaching. But on this slide, the company outlined data exclusivity — a protected period of time granted to FDA-approved treatments before rivals can sell similar versions — as an option to protect market share.
Psilocybin has been studied by researchers for decades. Recent studies from Imperial College London and Johns Hopkins University have shown promising results.
Compass said its goal was to “improve mental health through the development of new patient care pathways.”
The company was targeting depression as its main treatment focus.
Depression affects more than 300 million people worldwide, the World Health Organization and Organisation for Economic Co-operation and Development said. Around one-third of patients have what is called treatment-resistant depression, or depression that doesn’t get better with other treatments.
Compass said its objective was to help people with mental-health disorders.
This slide laid out the number of people worldwide affected by illnesses such as anxiety and eating disorders.
Compass received breakthrough-therapy designation from the FDA in 2018 for psilocybin.
This designation typically speeds up the FDA approval process for companies developing a treatment for serious conditions. To obtain this status, early trials must indicate “substantial improvement over available therapy on a clinically significant endpoint,” the FDA said.
The company also outlined its patent strategy. Compass said it had filed four patent claims.
Psilocybin therapy for depression offers benefits to patients and to society, Compass said.
The company’s breakthrough-therapy designation could help it get the treatment to market faster.
Medications with this designation can get to market in less than half the time, this slide said.
There have been studies indicating positive results with psilocybin therapy.
Researchers at New York University, Johns Hopkins, and other schools have studied psilocybin to treat not only depression but also existential distress in cancer patients.
In 2019, Compass said it expected to get approval for its psilocybin therapy in the US and the UK in 2022. The timeline has since been pushed back.
In June, Compass announced that it had completed its phase IIb trials — indicating a slower rollout. Delays aren’t unusual, and pandemic-related shutdowns have delayed clinical programs across the board.
A spokesperson for the company said the study was delayed by months because of the pandemic.
George Goldsmith told Insider in October that he expected treatments to come to market by 2025.
This slide provided a closer look at the timeline to getting Compass’ treatments to market.
This slide outlined where Compass planned to hold its mid-stage clinical trials.
Patients participating in Compass’ clinical trials underwent a rigorous process to ensure safety and data accuracy.
Patients took part in at least three visits for screening and preparation purposes. During a five- to six-hour treatment, they took psilocybin in pill form under the supervision of a therapist and assistant therapist. They returned five times so researchers could assess outcomes.
Compass wasn’t the only company developing better depression treatments.
The company outlined competitive treatments that were being developed or were available, such as esketamine and cognitive behavioral therapy. Psilocybin therapy’s total cost of treatment and reimbursement level were left blank.
Compass said its treatments could target markets worth hundreds of billions of dollars.
The company estimated that around 78 million possible patients existed in the US, the EU, and Japan, and that around a quarter could have treatment-resistant depression.
Compass used Sage Therapeutics as an example of a successful biotech company working on mental-health treatments.
Compass said Janssen, a unit of Johnson & Johnson, is another possible competitor.
In March 2019, a few months after this presentation was circulated, Janssen’s esketamine treatment, Spravato, was approved by the FDA. Spravato was designed for treatment-resistant depression.
Compass’ executive team has remained largely the same since 2019.
George Goldsmith, Ekaterina Malievskaia, and Lars Wilde are cofounders and still hold executive positions.
Hans Eriksson, the chief medical officer at the time, is now the chief clinical development officer at HMNC Brain Health; Joe Heinen, the former consulting chief financial officer, is now the CFO of Tapestry Networks, their LinkedIn profiles said.
This slide showed more executives at Compass.
Compass said it contracted with outside industry experts to handle responsibilities such as market access, intellectual property, and clinical methods.
The company’s scientific advisory board included some big names. Professor David Nutt, the chair of the board, is known for his extensive research.
This slide showed Compass’ board of directors.
Compass outlined the investors who took part in the company’s Series A round, such as Christian Angermayer’s Atai.
Mike Novogratz of Galaxy was also an investor, as was Gordon M. Sumner, whom you may know as Sting.
Peter Thiel, the German-American billionaire and a PayPal cofounder, also invested in the company’s Series A round, this slide said.
Founders Fund, a VC firm cofounded by Thiel, took part in Compass’ Series B round, a spokesperson for Compass said.