Vitura Health strikes psychedelic JV that will pave the way to manufacture MDMA and psilocybin in Australia

ASX-listed Vitura Health says it has already had positive engagement with psychiatrists to import and potentially manufacture key psychedelic drugs.

Vitura Health – known as the Amazon of medicinal cannabis – is considering pivoting from being a marketplace to a drug manufacturer after striking a joint venture with Canadian firm PharmAla Biotech.

The partnership, named Cortexa, aims to become Australia’s lead supplier of psychedelics for research and therapeutic research. It will allow the company to stock MDMA and psilocybin – commonly known as ecstasy and magic mushrooms – to treat post traumatic stress disorder and treatment-resistant depression.

The venture follows the Therapeutic Goods Administration allowing the use of MDMA and psilocybin under the Authorised Prescriber Scheme from July.

Vitura chief executive Rodney Cocks said Cortexa would be the exclusive licence holder of Pharm­Ala’s IP for MDMA and psilocybin in Australia and was already in talks with contract manufacturers about producing the drugs locally.

“The exciting part about the joint venture is we’ll be actually receiving the manufacturing IP from our joint venture partner, which will enable the onshore manufacturing of MDMA and psilocybin here in Australia,” Mr Cocks said.

“We won’t be doing that from day one but as the market scales, we’ll move from an imported model to a locally manufactured model. We’ve had initial discussions with contract manufacturers who could work with us on an exclusive basis to achieve that.” Vitura – formerly known as Cronos – is the first Australian medicinal cannabis stock to pay a dividend. It changed its name earlier this year as it branched deeper into digital heath, other drugs and potentially the pet pharmaceutical market.

Mr Cocks said that through Cortexa, psychedelics had the potential to match the size of the medicinal cannabis market.

“In terms of the market entry of these products in Australia, we may see a similar trajectory that we saw with medicinal cannabis. There will be some early adopters, and as it builds in terms of the results and outcomes for patients – as we saw that with medicinal cannabis – I think we’ll see a similar trajectory with psychedelic therapeutics.”

Australia is emerging as a leading centre for psychedelic drug trials, an industry that is attracting growing interest from venture capital groups.

Melbourne-based Ingenu has secured about $US100m ($148m) in research work for 2023, studying how psychedelics could be used to treat a range of mental health conditions, in the hope of spurring a biotech boom that far outstrips the growth in cannabis.

Ingenu is completing clinical trials on behalf of more than 20 companies – including some from the US – as the illicit drugs are catapulted into the mainstream to treat depression, anxiety, trauma, pain and even nicotine addiction and eating disorders. The global psychedelic therapeutics market could grow from $US3.6bn to $US8.3bn by 2028, according to estimates published by Insight Ace Analytic.

Mr Cocks – a former infantry officer in the Australian Army who also served on the Counter Narcotics Team of the British Embassy in Afghanistan – said post traumatic stress disorder was a significant unmet need.

“Everyone thinks of PTSD and veterans but then you think of first responders, emergency responders. These are large markets and addressing patients that are some of the most vulnerable in our community.

“We’ve had a lot of positive early engagement with the college (Royal Australian and New Zealand College of Psychiatry) and with individual psychiatrists who have expressed a very keen interest in prescribing these (psychedelics) or those groups we spoke about.”

Cortexa will pay PharmAla an annual licence fee of $250,000 for three years, and from that date the 50:50 joint venture becomes unconditional. Cortexa will also pay PharmAla a royalty equal to 5 per cent of the net profit generated by Cortexa.

Vitura has agreed to advance loan funds to Cortexa of up to $2.2m to give it sufficient working capital in its initial development stage.

Vitura will advance any such loan funds to Cortexa from its cash reserves.

In the past year, Vitura’s shares have surged 23.2 per cent to 34c, giving it a market value of $192m.