In this article, we will be taking a look at the 12 best psychedelic stocks to buy in 2025.
The Therapeutic Potential and Investment Boom in Psychedelic Medicine
In contrast to drugs like cocaine or marijuana, psychedelics are strong and give users access to a kind of “alternate reality.” One class of hallucinogenic substances that can produce unusual states of consciousness is psychedelics. LSD and chemicals originating from plants are among the many chemical substances included in this class. Psychedelics have the power to change or heighten feelings, thoughts, and energy levels, which frequently leads to spiritual experiences. They are divided into two primary categories: serotonergic chemicals (like LSD) and empathogens and dissociative drugs (like PCP). These medications are being investigated for therapeutic uses in addition to recreational ones, and they have shown promise in the treatment of several illnesses, including opiate addiction, severe depressive disorders, treatment-resistant depression, panic disorder, and post-traumatic stress disorder.
The revival of interest in psychedelics has been greatly aided by venture capital investors. Startups in this sector saw a spike in investor interest around the beginning of 2020, which was dubbed the “psychedelic renaissance.” On February 16, 2023, Clara Burtenshaw, a partner at Neo Kuma Ventures, the biggest European venture capital fund specializing in psychedelic investments, shared her excitement about psychedelic healthcare, saying:
“Psychedelic healthcare is a very exciting area because it’s this apex of drugs, clinics, and experimental treatments.”
Growth and Promise of the Psychedelic Drugs Market
Many psychedelic-focused pharmaceutical businesses are working to have their medications approved by the government. Psilocybin and other hallucinogens are showing great promise in treating disorders including schizophrenia and depression. The US psychedelic drugs market is projected to grow from $4.51 billion in 2025 to $15.62 billion by 2032, with a CAGR of 16.8%. This growth is part of a larger global trend, with the worldwide market expected to reach $11.93 billion by 2029, growing at a CAGR of 16.9%.
Psilocybin (magic mushrooms) is the most widely used psychedelic drug in the United States, with an estimated 8 million American adults using it in 2023, according to a survey conducted by RAND Corporation. Around 12% of respondents reported lifetime use, and 3.1% used it in the past year. LSD use has also risen significantly, particularly among individuals aged 18-25, with usage increasing from 0.9% in 2002 to 4% in 2019. The LSD market is projected to grow from $145.9 million in 2024 to $265.7 million by 2034. MDMA, although not providing specific usage data, remains popular, especially in research for PTSD treatment. Ketamine has gained attention for its depression treatment potential, particularly with the FDA approval of Spravato nasal spray.
Market growth is driven by rising mental health issues, increasing demand for alternative treatments, and regulatory changes as several US cities and states decriminalize or legalize psychedelics. Psychedelic drugs are showing therapeutic potential in treating conditions like depression, anxiety, PTSD, and addiction. Ongoing research and development are also expanding their therapeutic applications.
Photo by Florian van Duyn on Unsplash
Our Methodology
We selected the following psychedelic stocks based on the hedge fund sentiment, as assessed from Insider Monkey’s database, which tracks over 1,000 elite hedge funds as of the end of Q4 2024. The stocks are listed in ascending order according to the number of hedge fund holders for each stock.
Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).
Here is our list of the 12 best psychedelic stocks to buy in 2025.
12. NRx Pharmaceuticals, Inc. (NASDAQ:NRXP)
Number of Hedge Fund Holders: 3
NRx Pharmaceuticals, Inc. (NASDAQ:NRXP) is a clinical-stage biopharmaceutical company focused on developing therapies for central nervous system disorders, including suicidal bipolar depression, chronic pain, and PTSD. Its main product, NRX-101, combines D-cycloserine and lurasidone, two FDA-approved drugs. The company stands out for its innovative use of NMDA receptor modulators and atypical antipsychotics to treat mental health disorders.
NRx Pharmaceuticals, Inc. (NASDAQ:NRXP) is making significant strides in developing treatments for mental health disorders, particularly suicidal treatment-resistant bipolar depression and chronic pain. Its lead product, NRX-101, has been designated as a Breakthrough Therapy by the FDA, showing potential for large-scale market impact. As one of the best psychedelic stocks, the company is also advancing toward New Drug Applications (NDAs) for NRX-101 and NRX-100 (IV ketamine), with key approval decisions expected by 2025. The company estimates that NRX-101 could generate hundreds of millions in annual revenue, targeting around 3 million cases in the U.S.
NRx Pharmaceuticals, Inc. (NASDAQ:NRXP) is also expanding strategically through its subsidiary, Hope Therapeutics, which is setting up interventional psychiatry clinics, aiming for $100 million in revenue by the end of 2025. Financially, the company has made impressive progress. In Q3 2024, it reduced its net operating losses by 74% and cut research and development expenses significantly. NRx Pharmaceuticals, Inc. (NASDAQ:NRXP) ended the quarter with $1.6 million in cash and secured an additional $5.4 million in financing.
11. Cybin Inc. (NYSE:CYBN)
Number of Hedge Fund Holders: 9
Cybin Inc. (NYSE:CYBN) is a clinical-stage biopharmaceutical company focused on developing psychedelic-based therapies for mental health disorders. It creates novel compounds from traditional psychedelics like psilocybin and DMT to treat conditions such as major depressive disorder, anxiety, and addiction. The company’s business model centers on drug discovery, development, and the potential commercialization of these treatments.
Cybin Inc. (NYSE:CYBN) is advancing its psychedelic drug pipeline with several promising clinical programs. Its lead programs, CYB003 and CYB004, aim to improve the effectiveness and scalability of traditional psychedelics. CYB003, a deuterated psilocin analog, is being tested in a Phase 3 trial for major depressive disorder (MDD), with early Phase 2 results showing high response and remission rates. CYB004, a deuterated DMT formulation, is being developed for generalized anxiety disorder, with Phase 2 results expected in 2025. The company is also exploring non-hallucinogenic treatments through its CYB005 program.
In terms of financials, Cybin Inc. (NYSE:CYBN) ended Q3 2025 with C$136.3 million in cash, providing the company with the flexibility to continue its clinical programs and growth strategies. Despite a net loss of C$10.5 million for the quarter, the company has improved its operational efficiency compared to last year. Its new at-the-market equity program could also provide additional funding for its initiatives.
With promising clinical data, including CYB003’s Breakthrough Therapy Designation from the FDA, Cybin Inc. (NYSE:CYBN) is well-positioned for future growth. The company’s strong intellectual property portfolio and experienced management team add to its potential in the rapidly growing psychedelic medicine market.
10. GH Research PLC (NASDAQ:GHRS)
Number of Hedge Fund Holders: 10
GH Research PLC (NASDAQ:GHRS) is a clinical-stage biopharmaceutical company focused on developing treatments for psychiatric and neurological disorders using mebufotenin (5-MeO-DMT), a potent psychedelic compound. Its lead product, GH001, is an inhalable form of 5-MeO-DMT aimed at treating treatment-resistant depression (TRD).
GH Research PLC (NASDAQ:GHRS), standing tenth among the best psychedelic stocks to buy in 2025, announced positive results from its Phase 2b clinical trial of GH001 for treatment-resistant depression (TRD). The trial showed a significant reduction in depression symptoms, with a -15.2 point improvement on the Montgomery-Åsberg Depression Rating Scale (MADRS) compared to +0.3 points in the placebo group. This rapid antidepressant effect was seen just two hours after treatment. The trial also showed a strong safety profile, with no serious adverse events, and most patients were discharged within an hour of treatment. These results led to a 79.07% increase in GH Research’s stock price.
In its Q3 2024 financial report, GH Research PLC (NASDAQ:GHRS) reported strong financial health, with $193.8 million in cash and assets as of September 30, 2024. However, research and development expenses rose to $8.4 million, and general and administrative expenses increased to $4.2 million, reflecting the company’s expansion efforts. The net loss for the quarter was $12.1 million, up from $5.6 million the previous year.
9. Atai Life Sciences N.V. (NASDAQ:ATAI)
Number of Hedge Fund Holders: 14
Atai Life Sciences N.V. (NASDAQ:ATAI) is a clinical-stage biopharmaceutical company focused on developing psychedelic-inspired treatments for mental health disorders like depression, anxiety, and addiction. While it doesn’t yet sell products, the company generates revenue through research, clinical trial support, and licensing agreements. What sets Atai Life Sciences N.V. (NASDAQ:ATAI) apart is its decentralized drug development model, where it creates and acquires businesses focused on specific psychedelic compounds, allowing for a diversified portfolio and reduced risk.
As of September 30, 2024, Atai Life Sciences N.V. (NASDAQ:ATAI) reported a strong cash position of $101.0 million, providing an operational runway into 2026. The company reduced its R&D expenses to $12.4 million in Q3 2024, down from $13.3 million in Q3 2023, and also lowered its general and administrative expenses to $10.3 million from $13.6 million. However, the corporation posted a net loss of $26.3 million for Q3 2024, compared to a net income of $44.2 million in Q3 2023.
Recognized among the best psychedelic stocks, Atai Life Sciences N.V. (NASDAQ:ATAI) is making significant progress in its clinical pipeline. VLS-01, a DMT treatment for treatment-resistant depression, has received FDA clearance and expects to begin Phase 2 studies by the end of 2024. EMP-01, an R-MDMA treatment for social anxiety disorder, also anticipates its Phase 2 trial around the same time. RL-007, targeting cognitive impairment in schizophrenia, is in Phase 2b, with results expected in mid-2025. Additionally, Atai Life Sciences N.V. (NASDAQ:ATAI) completed the acquisition of IntelGenx Corp., enhancing its drug delivery capabilities for VLS-01’s buccal film DMT program.
8. Mind Medicine (MindMed) Inc. (NASDAQ:MNMD)
Number of Hedge Fund Holders: 21
Mind Medicine (MindMed) Inc. (NASDAQ:MNMD) is a clinical-stage biopharma company focused on creating new treatments for brain health disorders and stands eighth among the 12 best psychedelic stocks to buy in 2025. It is creating a variety of product candidates that impact important neurotransmitter pathways, some with and some without perceptual effects, to become a leader in this sector. With its pipeline, which is intended to enhance patient outcomes in difficult neurological disorders, the company is attempting to solve issues related to brain health.
On November 7, Mind Medicine (MindMed) Inc. (NASDAQ:MNMD) released updates on its clinical studies and financial performance for the third quarter of 2024. To assess MM120 ODT, a kind of lysergide D-tartrate (LSD), for generalized anxiety disorder (GAD), the business is getting ready for its first Phase 3 trial, Voyage, which was scheduled for late 2024. A second GAD trial, called Panorama, is scheduled for 2025.
Additionally, in early 2025, it intends to begin Emerge, its first Phase 3 trial of MM120 ODT for major depressive disorder (MDD). Initial results from these GAD and MDD trials are expected by the business in 2026.
MM402, a modified version of MDMA intended to treat autism spectrum disorder (ASD), is another advancement made by Mind Medicine (MindMed) Inc. (NASDAQ:MNMD). More research is planned to evaluate MM402’s potential to lessen ASD symptoms after a Phase 1 study was finished in October 2024. The FDA has classified MM120 as a breakthrough therapy for GAD because of the high unmet needs, particularly in patients who are resistant to treatment.
The amount of cash and cash equivalents held by the corporation increased from $99.7 million at the end of 2023 to $295.3 million as of September 30, 2024. More than a year after the first Phase 3 data readout for MM120 ODT in GAD is expected, Mind Medicine (MindMed) Inc. (NASDAQ:MNMD) anticipates using this money to fund operations through at least 2027.
7. COMPASS Pathways plc (NASDAQ:CMPS)
Number of Hedge Fund Holders: 26
COMPASS Pathways plc (NASDAQ:CMPS) is a British pharmaceutical company leading the development of psychedelic medicine, primarily focused on COMP360, a synthetic psilocybin therapy for treatment-resistant depression (TRD). While it doesn’t generate revenue from drug sales, it funds operations through research grants and investor capital. What sets the company apart is its advanced clinical progress—COMP360 is currently in Phase 3 trials, making it one of the most developed psychedelic treatments. If successful, it could become the first FDA-approved psychedelic-assisted therapy for a major mental health condition.
COMPASS Pathways plc (NASDAQ:CMPS) is a biotechnology company developing COMP360, a proprietary synthetic psilocybin therapy for treatment-resistant depression (TRD). By combining COMP360 with psychological support, the company aims to revolutionize mental health treatment.
In Q3 2024, COMPASS Pathways plc (NASDAQ:CMPS) reported a net loss of $38.5 million, driven by continued investment in its Phase 3 trials. R&D expenses were $32.9 million, while G&A expenses totaled $15.0 million. With a strong cash position of $207 million, the corporation expects to fund operations into 2026.
The company’s Phase 3 trials for COMP360 are the largest of their kind, with key data from the COMP005 trial expected in Q2 2025 and the COMP006 trial results anticipated in H2 2026.
The bull case for COMPASS Pathways plc (NASDAQ:CMPS) rests on its potential to deliver a breakthrough TRD treatment, a strong financial position to support clinical milestones, and an undervalued stock relative to its market opportunity. A strategic focus on its core COMP360 program could enhance efficiency and increase success probability.
6. Sage Therapeutics, Inc. (NASDAQ:SAGE)
Number of Hedge Fund Holders: 27
Sage Therapeutics, Inc. (NASDAQ:SAGE) is a biopharmaceutical company developing treatments for brain health disorders, focusing on the GABA and NMDA receptor systems. Its flagship product, Zulresso, is the first FDA-approved treatment for postpartum depression. The company also generates revenue from its newly approved medication, Zurzuvae, as well as research collaborations and pharmaceutical partnerships.
In 2024, Zurzuvae became the first licensed oral medication for postpartum depression (PPD) in adults, and Sage Therapeutics, Inc. (NASDAQ:SAGE), one of the best psychedelic stocks, saw great success with its early commercialization. Despite fewer days in the field because of the Christmas season, about 2,500 prescriptions of Zurzuvae were shipped during the fiscal fourth quarter of 2024, a 21% increase from the third quarter. Furthermore, approximately 6,600 prescriptions were shipped during the course of the year, demonstrating a robust increase in demand.
To reach more healthcare providers, Sage Therapeutics, Inc. (NASDAQ:SAGE) intends to invest in a combined sales force growth. Through social media and direct-to-consumer initiatives, including possible branded TV media, it also intends to invest in media possibilities to raise awareness and amplify the message that PPD is a serious medical condition.
5. Alkermes Plc (NASDAQ:ALKS)
Number of Hedge Fund Holders: 36
Alkermes plc (NASDAQ:ALKS), standing fifth among the best psychedelic stocks to buy in 2025, specializes in neuroscience, developing treatments for mental health and neurological disorders like alcohol and opioid dependence, schizophrenia, and bipolar I disorder. The company generates revenue through its proprietary drugs, including Vivitrol, Aristada, and Lybalvi.
Alkermes plc (NASDAQ:ALKS) delivered strong financial results in 2024, with total revenue surpassing $1.5 billion, driven by its proprietary drug portfolio. The company generated over $450 million in EBITDA and ended the year debt-free with $825 million in cash. Additionally, the corporation repurchased 8 million shares, further strengthening shareholder value.
Key products performed well, with Vivitrol sales reaching $457.3 million (up 14%), Aristada growing 6% to $346.2 million, and Lybalvi surging 46% to $280 million. Meanwhile, the company is advancing its ALKS 2680 program for narcolepsy, with Phase 2 trial data expected in late 2025, positioning Alkermes plc (NASDAQ:ALKS) for growth in neurological treatments.
For 2025, Alkermes plc (NASDAQ:ALKS)’s revenue is expected to range between $1.34 billion and $1.43 billion, with adjusted EBITDA projected between $310 million and $340 million. However, the company anticipates a $215 million decline in manufacturing and royalty revenue due to the expiration of the INVEGA SUSTENNA royalty, increased R&D expenses for ALKS 2680 trials, and heightened competition in the antipsychotic market, prompting an expansion of its psychiatry sales team.
4. Intra-Cellular Therapies, Inc. (NASDAQ:ITCI)
Number of Hedge Fund Holders: 55
Intra-Cellular Therapies, Inc. (NASDAQ:ITCI) is a biopharmaceutical company focused on developing treatments for neuropsychiatric and neurological disorders. Its flagship drug, Caplyta (lumateperone), is approved for schizophrenia and bipolar depression in adults. The company generates revenue mainly from Caplyta sales, along with income from research collaborations and licensing agreements. It is also developing ITI-1549, a non-hallucinogenic psychedelic designed to treat mood disorders by targeting 5-HT2A receptors while avoiding hallucinogenic effects and cardiac risks. Preclinical studies suggest ITI-1549 enhances neuroplasticity, increases social interaction, and reduces anxiety and depressive symptoms.
Johnson & Johnson’s announcement that it would buy Intra-Cellular Therapies for $14.6 billion in cash at $132 per share caused the stock to spike in 2025.
Sales of Caplyta at Intra-Cellular Therapies, Inc. (NASDAQ:ITCI) continued to rise sharply. The business reported net product sales of $175.2 million for the third quarter of 2024, a 39% increase over the same period in 2023. Total revenue for the quarter reached $175.4 million, with a net loss of $26.3 million.
3. AbbVie Inc. (NYSE:ABBV)
Number of Hedge Fund Holders: 85
AbbVie Inc. (NYSE:ABBV) is an American multinational biopharmaceutical company that specializes in the development and commercialization of advanced therapies and treatments in various areas of healthcare.
With a wide spectrum of therapies in immunology, oncology, neurology, and eye care, the business stands out as a major pharmaceutical corporation. Additionally, it sells popular cosmetic goods like Juvederm and Botox for skincare and anti-aging products.
AbbVie Inc. (NYSE:ABBV) has entered the next-generation neuroplastogen field through collaboration with Gilgamesh Pharmaceuticals to develop innovative psychiatric treatments. Announced on May 13, 2024, the deal includes a $65 million upfront payment, up to $1.95 billion in milestone fees, and tiered royalties. The partnership aims to create neuroplastogens that enhance neuroplasticity while minimizing hallucinogenic effects and treatment burdens. AbbVie Inc. (NYSE:ABBV), recognized as one of the best psychedelic stocks, seeks to expand its psychiatric drug pipeline beyond Vraylar, leveraging Gilgamesh’s AI-driven research and clinical-stage assets, GM-1020 and GM-2505, for major depressive disorder. This move reflects a broader industry trend toward refining psychedelic-based therapies amid evolving regulations and market interest.
AbbVie Inc. (NYSE:ABBV) reported $15.1 billion in revenue for the fourth quarter, which was 5.6% higher year over year and more than the $14.87 billion analysts had predicted. According to GAAP, the corporation reported a $0.02 quarterly net loss per share. Nevertheless, it reported adjusted diluted profits per share (EPS) of $2.16, which was somewhat higher than the $2.13 experts had predicted.
Due to increased worldwide demand and steady market expansion, Skyrizi and Rinvoq sales in 2024 reached $17.7 billion, a 51% increase from the year before. Strong growth in its neurology and oncology businesses helped AbbVie Inc. (NYSE:ABBV)’s overall revenue, which increased by 18% year over year when the Humira platform was removed.
2. Merck & Co., Inc. (NYSE:MRK)
Number of Hedge Fund Holders: 91
Merck & Co., Inc. (NYSE:MRK) is a prominent American multinational pharmaceutical corporation that is historically tied to the original Merck Group and is ranked second among the best psychedelic stocks to buy in 2025. Globally known as Merck Sharp & Dohme (MSD), the corporation offers biologic treatments, vaccines, prescription medications, and animal health products.
Merck & Co., Inc. (NYSE:MRK) is advancing psychedelic research, particularly for treatment-resistant depression (TRD). In 2021, it partnered with Novamind to conduct clinical trials on MK-1942, evaluating its efficacy alongside antidepressants. The company is restructuring its R&D with global innovation hubs to enhance drug discovery and seek external scientific advancements. While MK-1942’s psychedelic nature is unclear, Merck & Co., Inc. (NYSE:MRK) is likely exploring novel TRD treatments, including psychedelic-inspired compounds.
While keeping a Market Perform rating, Bernstein SocGen Group lowered its price objective on Merck & Co., Inc. (NYSE:MRK) shares from $110 to $95 on February 10. A key element of the adjustment, according to analyst Courtney Breen, is worries about Merck’s vaccine, Gardasil, which is approaching the end of its exclusivity term (LOE). The company’s Q4 profitability notwithstanding, the stock’s performance has been negatively impacted by persistent Gardasil concerns. Breen notes that $200 million in sales from China have now been realized, de-risking the lower end of the Gardasil sales forecast. This development has been incorporated into Bernstein SocGen’s base case scenario.
GreensKeeper Asset Management stated the following regarding Merck & Co., Inc. (NYSE:MRK) in its Q3 2024 investor letter:
“Merck & Co., Inc. (NYSE:MRK) was our second-largest detractor this quarter, declining -8.3%. MRK’s leading HPV vaccine, GARDASIL 9, faced challenges internationally due to inventory buildup within its Chinese distributor, which is expected to reduce shipments for the remainder of 2024. Despite this short-term impact, the long-term outlook for GARDASIL 9 remains promising. Meanwhile, the company’s $27 billion Keytruda cancer juggernaut continues to grow at a healthy clip, powering earnings growth.”
1. Johnson & Johnson (NYSE:JNJ)
Number of Hedge Fund Holders: 98
Johnson & Johnson (NYSE:JNJ) develops, manufactures, and sells a range of healthcare products through its subsidiaries and tops the list for being one of the best psychedelic stocks. The business is divided into two segments: Innovative Medicine and MedTech, with a primary focus on human health and well-being. Its Innovative Medicine division covers therapeutic areas such as infectious diseases, immunology, neuroscience, metabolic and cardiovascular disorders, pulmonary hypertension, and oncology. The MedTech segment includes a variety of medical devices used in cardiovascular intervention, orthopedics, interventional solutions, surgery, and vision.
As part of its commitment to neuroscience and mental health treatments, Johnson & Johnson (NYSE:JNJ) is advancing psychedelic medicine with Spravato (esketamine), an FDA-approved nasal spray for treatment-resistant depression and acute suicidal ideation. Since its 2019 approval, Spravato has seen strong commercial success, with Q2 2024 sales reaching $271 million and projected annual revenue exceeding $1 billion. Its success highlights the commercial viability of psychedelic-based treatments. The corporation continues investing in neuropsychiatric research, conducting clinical trials, and gathering real-world data to support drug development, further encouraging research, investment, and regulatory advancements in the psychedelic industry.
Expanding its neurological portfolio, Johnson & Johnson (NYSE:JNJ) announced the $14.6 billion acquisition of IntraCellular on January 13, gaining access to Caplyta, an oral drug for treating bipolar disorder and schizophrenia. The acquisition strengthens the company’s presence in the mental health sector while complementing its existing neuroscience pipeline.
Beyond its pharmaceutical advancements, Johnson & Johnson (NYSE:JNJ) maintains strong fundamentals with a AAA credit rating, higher than that of the US government. In fiscal year 2024, the company reported sales of $88.8 billion, reflecting a 4.3% year-over-year growth. Its revenue reached $22.5 billion, marking a 5.2% year-over-year increase. The MedTech segment saw a 6.2% rise in global operational sales, with acquisitions and divestitures contributing 1.5% to this growth. Growth in the Cardiovascular division was driven by strong demand for electrophysiology products and Abiomed, while the General Surgery segment expanded due to increased sales of wound closure products.
Overall, Johnson & Johnson (NYSE:JNJ) ranks first among the 12 best psychedelic stocks to buy in 2025. While we acknowledge the potential of pharmaceutical companies, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than JNJ but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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