Unbundling Psychedelic Therapy
Part 1: Direct-to-Consumer healthcare & Decentralized Clinics
Welcome to Part I of Unbundbling of Psychedelic Therapy, a series of essays on how we should expect Psychedelic Assisted Therapy to evolve over the next several years and the technological forces driving this evolution.
Today, in Part I, we’ll look at a model of Direct-to-Consumer/Decentralized Clinic Models currently being applied to ketamine therapy but in the future could provide the infrastructure for Naturalist & Real-Word research on all varieties of psychedelics and the contexts and settings in which they are used.
Next week, in Part II, we’ll look at the prospect of Psychedelic Procedures (not therapy) as the means of integrating psychedelic medicine into modern healthcare systems.
In Part III, we’ll explore Virtual Reality in the delivery of Psychedelic Medicine.
If you enjoy these dispatches and find them helpful for making sense of the emerging psychedelic space (or confusing!), please consider sharing with friends and colleagues, hitting the heart icon ❤️ above, or saying hello via email.
If you’ve been forwarded this newsletter, please consider signing up below:
“There are only two ways to make money, bundling and unbundling”
The premise is that products, businesses, and industries are under constant evolutionary pressure from technological evolution, and the market control a business may have will eventually be disrupted by new technology—the archetypal example of this process, The Great Unbundling, is that of newspapers and print media in the internet age:
“The most obvious casualty has been text-based publications, and the reason should be clear: once newspapers and magazines lost their distribution-based monopoly on customer attention the integration of editorial and advertising fell apart. Advertisers could go directly to end users, first via ad networks and increasingly via Google and Facebook exclusively, while end users could avail themselves of any publication on the planet.”
However, the classic bundling/unbundling analysis does not apply to us here in psychedelics since there is not a true industry yet.
Nevertheless, we do have something2 emerging, and this something is predicated on promising research based on a format from the 1950s and 60s that will be exposed to the forces of unbundling.
Clinical research on psychedelics to date has followed a common template that we can think of as a Five-pronged V13 of modern Psychedelic Assisted Therapy (PAT) that includes:
Specially trained therapists
Clinical settings specifically outfitted for PAT
Therapist-mediated preparation that includes trust-building, education, intention setting, etc.
A psychoactive drug that creates a consciousness-altering experience that is monitored/supported by a therapist
Post-experience integration via psychotherapy
This format has been used to evaluate PAT for the treatment of PTSD, Depression, Smoking, Alcohol Dependence, Cancer-related and Anxiety, and others with promising but preliminary results in small studies.
The format has allowed ethics committees, Institutional Review Boards (IRBs), and regulators to even allow for the study of what the culture and the law deem dangerous substances.
However, because this format is time and labor-intensive many of the forthcoming studies, products, and strategies we see in the psychedelic space are intended to save costs, time, and therapists hours, thus unlocking access for more people.
In other words, this format is being unbundled.
Starting with an overview of the MAPS Phase III trial to flesh out the V1 Framework, we’ll look at the recent example of Journey Clinical’s Direct-to-Consumer Ketamine & Decentralized clinical model and how it portends the Unbundling of PAT.
Let’s get to it.
The V1 Bundle: MDMA Assisted Psychotherapy for PTSD
Even though there is a long history of indigenous shamanic practice and underground therapy, the much anticipated FDA approval of MDMA-assisted therapy (MAT) for the treatment of PTSD will be the starting point of Psychedelic Medicine in sanctioned and legal contexts4.
This format includes three preparation sessions in which patients meet with a trained therapist to develop a therapeutic alliance, set intentions, and mentally and emotionally prepare for a cathartic though challenging experience.
Next are three dosing sessions in which two therapists, one male one female, sit with and offer support to patients for the duration of the MDMA experience. These sessions last 8 hours.
This is followed by nine one-on-one integrative psychotherapy sessions in which participants process their experience within a psychotherapeutic context, again with a trained and licensed therapist.
The critique of this format is that it is time and labor-intensive and will be difficult to scale. But as the first psychedelic/empathogen to run the drug development gauntlet, this is a feature, not a bug.
The trial was designed to test MAT as a treatment for a challenging condition to calm the regulator’s fears that this politically maligned substance is safe and has therapeutic benefits.
While this has been the format for clinical trials, as Amy Emerson, CEO of MAPS Public Benefit Corp, notes in a recent series from Fierce Biotech, there are many details to be ironed out that will affect the commercial format and thus access, pricing, and the therapist’s role:
“The FDA was unsure what to do with the therapy part of it. Do they look at the therapy training program? What is the label going to say? How much do you put in the REMS [Risk Evaluation and Mitigation Strategy] and how much do you put in the label?”
As I understand, it remains to be seen how much deviation from this protocol the FDA will allow upon approval. I have heard suggestions that since the FDA does not regulate psychotherapy, it is conceivable that clinics could disband with the preparation, integration, and psychotherapy altogether upon commercialization.
On the other hand, this is the precise rationale for Risk Evaluation and Mitigation Strategies (REMS), which are meant to enforce specific precautionary measures for drugs that come with specific risks. In the case of MDMA, it might warrant the FDA demanding that treatment include therapy5.
Regardless of what happens with the labeling and REMS, most people close to the matter expect some deviation from the V1 format that could include group settings, the use of telemedicine, and even virtual reality.
This is the opportunity that an increasing number of companies are hoping to capitalize on with novel products and strategies to reduce the costs and human hours of psychedelic therapy treatments.
We should expect a Cambrian Explosion of innovation in how psychedelic sessions are prepared for, supported, monitored, and followed up.
A ‘decentralized clinic model’ is one such innovation.
DTC Healthcare, The Decentralized Psychedelic Clinic & Real-World Data
In 2014 the patent on Propecia, a drug to treat hair loss, expired.
Around the same time, a group of now well-known companies such as Warby Parker, Casper, and Dollar Shave Club successfully disrupted the entrenched industries of eyewear, mattresses, and razor blades, respectively, with novel Direct-to-Consumer (DTC) business models.
This new wave of DTC companies saw success disrupting bloated and entrenched industries through a combination of digital advertising, economies of scale, and direct shipping.
One such bloated and entrenched industry is healthcare.
Early DTC healthcare companies such as Roman, Hims, and Keeps started by focusing on conditions with off-patent, or soon to be off-patent, prescription drugs, and social stigma.
Erectile dysfunction and hair loss were the first indications.
By offering consumers (patients) a prescriber via telemedicine, a simple pricing model, and discreet shipping, they enabled access to Viagra, Cialis, and Propecia without in-person trips to doctors or pharmacies.
And it worked.
Fast forward to 2020, and the Covid pandemic is driving the massive increase in telemedicine and a loosening of regulations for online prescribing, thus enabling the field of DTC healthcare to truly accelerate.
According to a report from HTD Health, DTC healthcare may become the new normal (emphasis added):
“As market factors like COVID-19 and regulatory changes support the growth of the DTC healthcare landscape, companies continue to innovate in order to serve patients better and for longer. Specifically, by utilizing a wider variety of care tactics, companies are providing care that is more complex and comprehensive. This is a pronounced shift from earlier DTC approaches focused on offering generic prescriptions or short-term care for a small range of health concerns.”
So what does any of this have to do with psychedelics?
Journey Clinical (JC) is one such company hoping to offer a more comprehensive approach to DTC healthcare in the psychedelic medicine arena.
They recently raised $3 million to expand their decentralized clinic model, which would enable non-prescribing therapists (psychologist, LMFT, LPC, etc.) to use ketamine with their patients.
CEO Jonathan Sabbagh told Tech Crunch:
“When we asked what was the main bottleneck for therapists to offer KAP to their patients, the #1 response was access to a prescribing doctor. Our alpha test group confirmed that guaranteeing access to a trained medical team and building a robust care management system would solve an essential bottleneck of mainstream adoption for KAP.”
Like Roman, Hims, and other first-generation DTC Healthcare companies, JC is enabling online consultation, prescription, and shipping, but unlike these predecessors, JC is not cutting out the patient’s therapist but rather servicing them directly, and thus their patients.
JC is not really DTC; it’s more of a DTT, Direct-to-Therapist by offering therapists a prescribing service rather than trying to intermediate the patient-provider relationship.
"Journey gives therapists nearly all of what they need to turn their normal office into a space for ketamine experiences. Journey connected Buller to one of its prescribers to get the actual ketamine. The prescriber, a Psychiatric Nurse Practitioner, worked with Buller’s patient to make sure ketamine wasn’t contraindicated and was clinically appropriate for his treatment. A ketamine lozenge was mailed to the patient’s house... The client can take the lozenge either with their therapist, at home, or during video chat with the therapist."
This makes perfect sense for ketamine, a cheap, generic, off-label drug that can be shipped directly to patients.
The challenge for JC and other decentralized psychedelic providers/clinics is that upon FDA approval, MDMA, psilocybin, and any other psychedelic will have REMS that will presumably include onsite storage requirements that precludes them from ever leaving the clinical site, making them impossible to ship to patients.
Surely they are not limiting themselves to ketamine, so how could they capitalize on other psychedelics substances?
Two possible ways:
Infrastructure for naturalist & real-world research
Return to brick & mortar clinics
As we’ve covered in The Middle Way: Tech-Enabled Psychedelic Pragmatic Clinical Trials:
“We are in the early days of a digital revolution in healthcare. The tools available to patients, providers, scientists are increasingly applying evolutionary pressure to the institutions, incentives, and processes of care delivery and clinical research…
With psychedelics, we have a situation in which the sanctioned path to access (FDA confirmatory trials) is limited in its ability to help us understand the real-world implications, while at the same time, there are growing numbers of people who are self-administering this treatment, in the real world.
Concurrently, the technology that enables wearables and biosensors that capture biometric data is coming of age.
Under this evolutionary pressure, the rationale for a framework of Pragmatic Clinical Trials for psychedelic therapy is very compelling…”
JC is not just shipping ketamine. Through partnerships with a software provider (Osmind) and therapist training operator (Fluence), they are creating at least part of the infrastructure necessary to answer the question posed y Carhart-Harris, Gazzaley: Can pragmatic research, real-world data and digital technologies aid the development of psychedelic medicine?
Presumably, therapists and patients on the JC platform will be using psychedelics beyond ketamine. Therefore such technological infrastructure could be the means that a whole variety of reliable Real-World Data is generated.
Re-bundling: Brick & Mortar Clinics
Ironically, decentralized clinic and DTC healthcare models may become the technological infrastructure that enables a return to in-person care.
The problem that DTC companies have faced is that the cost savings of excising retail and brick and mortar are being eaten up by customer acquisition costs which are by and large being paid to Google and Facebook. This is driving early DTC companies to, ironically, rely on big-box retailers for growth.
As the original tech/business newsletter writer and Jim Barksdale evangelist Ben Thompson notes:
“Here is the problem for DTC companies: Facebook really is better at finding them customers than anyone else. That means that the best return-on-investment for acquiring customers is on Facebook, where DTC companies are competing against all of the other DTC companies and mobile game developers and incumbent CPG companies and everyone else for user attention. That means the real winner is Facebook, while DTC companies are slowly choked by ever-increasing customer acquisition costs.
This takes us back to Harry’s, and the decision to pursue bricks-and-mortar retail in the first place. It’s a choice that doesn’t make much sense in the theoretical value chain I sketched out above, where DTC companies integrate marketing and retail. However, once it became apparent that Facebook and Google squeezed far more value out of the online value chain than offline, the only option left was to pursue some sort of low-end disruption in the old value chain.
This return (re-bundling) of DTC to retail is also at play in DTC Healthcare, again from the HTD report:
“Now, companies like Tia don’t just allow users to track and understand their period, but serve as a provider for primary care, gynecology, mental healthcare, and acupuncture. In addition to treating a wide variety of health concerns, Tia’s model utilizes several care tools, including telehealth visits, asynchronous messaging, an online patient portal, and in-person clinics. Their rapid growth and expansion is evidenced by the recent partnership with CommonSpirit, one of the country’s largest nonprofit hospital systems. Together, the groups plan to open additional Tia clinics in the Phoenix area and beyond.”
This is the cycle of bundling and unbundling that Barksdale has become known for and the lens that virtually all technological disrpution is viewed.
What will drive new operations like JC and others to eventually consider in-person care is the assumption that the REMS for all yet-to-be-approved psychedelics will dictate that the substances never leave the clinic. This is also the approach I believe we’ll see in Oregon.
So it makes sense that operations that might appear to be simply DTC ketamine can, in fact, lay the groundwork for future research paradigms, therapist training, and clinical infrastructure.
Unbundling PAT: Clinical Infrastructure→ Technological Infrastructure
As far as innovation against the V1 format we discussed above, JC’s approach to a decentralized clinic model would enable patients to journey in the comfort of their own home or the office of a therapist with whom they perhaps have a long-standing therapeutic alliance and thus an example of the current clinical infrastructure giving way to technological infrastructure.
That’s it for Part I of this Unbundling Psychedelic Therapy series; I hope you enjoyed it.
Next week, we’ll look at the prospect of Psychedelic Procedures as an adoption vehicle into mainstream healthcare settings. Here’s a teaser:
I think it is more likely that the question for commercial entrants is not “what happens when you combine procedures like TMS with psychedelics?” but rather, “what is the optimal vehicle for integrating pscyehdelic medicine into the existing healthcare system: is it as a “procedure” or as therapy?”
Closing thought courtesy of Dror Poleg
Industry, ecosystem, renaissance, landgrab, whatever you want to call it.
The well-justified push back to this claim is that indigenous, shamanic practices are the true V1s and that non-medical/retreat/underground/personal use has a robust history and best practices. This is true but here I am thinking about this in the context of clinical research and what we can expect to see as the V1 in healthcare and forthcoming legal settings, i.e., Oregon and perhaps Canada.
A reasonable push back to this claim is ketamine is increasing use in clinical settings today. This is true, but it is used off-label thus does not have scrutiny from regulators, REMS, or any guidelines that providers must adhere to.
Psilocybin Alpha has a great teardown of Risk Evaluation and Mitigation Strategies in the context of patents.