Coping With Capacity Constraints

Overview

Despite an overall market slowdown in 2022, funding for the psychedelics sector remained on par with 2020, with almost $600 million flowing into psychedelic drug development and adjacent areas. During the next five to 10 years, as psychedelic assets move from development to commercialisation, thousands of therapists and clinics will require training to deliver psychedelic-assisted therapies, creating a new challenge for sponsoring companies (see Figure 1, drug development pipeline as of May 2023). 

Programmes in clinical development

In 2023, an MDMA-assisted therapy for post-traumatic stress disorder (PTSD) developed by the Multidisciplinary Association for Psychedelic Studies is likely to become the first psychedelic-assisted therapy approved by the US Food and Drug Administration (FDA), with COMPASS Pathways’ psilocybin therapy for treatment-resistant depression following in 2025. There are currently more than 50 programmes in clinical development (see Figure 1), mostly in Phases I and II. Post-traumatic stress disorder (PTSD), treatment-resistant depression (TRD), alcohol use disorder (AUD), opioid use disorder (OUD), major depressive disorder (MDD) and generalised anxiety disorder (GAD) are the most studied indications in terms of planned and ongoing trials. Beyond the headline programmes in PTSD and TRD outlined above, companies trialling psychedelic-assisted treatments for these mental health conditions will face a critical inflection point during 2023 in terms of demonstrating clinical efficacy and ability to advance assets into late-stage trials.

In these six most advanced indications, there are likely to be over seventy million patients with these conditions across the US, UK and EU4, and about 50 million of those patients potentially would be eligible to participate in psychedelic-assisted therapy programmes based on the severity of their symptoms and their willingness to accept medical treatment. Based on market feedback and in line with analyst expectations, L.E.K. Consulting estimates that approximately 5% of patients in these markets will be considered for psychedelic-assisted therapy. Taking into account conservative adjustments for physician willingness to prescribe (30%) and patient willingness to accept a psychedelic drug treatment option (50%), 0.75% of all eligible patients could receive psychedelic-assisted therapy. This translates to more than 400,000 patients per year, with 210,000 in the US.

The growing need for trained therapists

These 400,000 patients will require courses of treatment delivered by trained therapists in specially designed clinical settings in alignment with carefully prepared protocols (see Figure 2). Treatment delivery will be strictly monitored, and the FDA is likely to require a specific Risk Evaluation and Mitigation Strategy programme for each psychedelic therapy.

AUD and OUD patients are likely to require two doses of a psychedelic drug provided as a single acute treatment course with one eight-hour supervised dosing session along with eight hour-long therapy sessions. We expect patients with PTSD, TRD, MDD or GAD to receive chronic treatment courses consisting of approximately four doses per year, each with five accompanying hour-long therapy sessions, aligning with COMPASS Pathways’ expectation that one to three administrations will be required in a six-month period. In this scenario, one therapist would oversee preparation and integration settings and two would supervise the dosing session. 

Based on these assumptions, we estimate that a total of approximately 23,000 therapists and 4,200 clinics will be required across the US, UK and EU4 to deliver psychedelic-assisted therapy for these six conditions (see Figure 3).

Although this is a substantial figure, an infrastructure of therapists and clinics will not need to be built from the ground up. There are currently more than 110 ketamine therapy clinics in the US, many of which operate as part of rapidly expanding clinic networks aiming to provide a base for the delivery of psychedelic therapy, upon approval. In Europe, psychedelic-assisted therapy could be provided alongside current treatments in existing outpatient psychiatric facilities. In both the US and Europe, clinics offering psychiatric interventions such as transcranial magnetic stimulation or electroconvulsive therapy may be well suited to the provision of psychedelic-assisted therapies due to their familiarity with complex delivery protocols as well as billing and reimbursement processes. 

Specialised training is vital

Therapists and other clinicians will require specialised training, which may be delivered by a training provider, such as Fluence or the Institute of Psychedelic Therapy, or through training programmes run by psychedelic drug development companies. There are approximately 200,000 active licensed therapists practising in the US today, and forecasted demand would require about 6% of these practitioners to be trained in psychedelic-assisted therapy. The challenge of reaching this required volume will be amplified by an underlying shortage of therapists and mental health professionals.

Beyond reaching these broader capacity requirements, the most significant overall challenge — in terms of both physical and human infrastructure — is likely to be the ability to meet initial levels of demand as the therapies first launch.

There are several key areas where delivery optimisation could reduce infrastructure and capacity challenges. Firstly, during the development of psychedelic-assisted therapies, the number of therapists specified in protocols for preparation and integration sessions has been reduced from two to one. Over the next two to three years, we expect protocols for dosing sessions to similarly reduce requirements to a single supervising therapist or two less-specialised assistants. The speed of this change will depend on how comfortable regulatory authorities are with the psychedelic therapies, and protocol reviews are likely to take place once the first psychedelic products have been launched. In this single-therapist scenario, only 14,000 therapists and 3,000 clinics would be needed to treat 400,000 patients per year (see Figure 4). 

Group therapy presents another area for potential delivery optimisation, with therapy sessions delivered in groups and dosing sessions involving multiple patients supervised by a single therapist. At a ratio of one therapist to four patients, only 6,000 therapists would be required across 1,000 clinics. Digital approaches may also reduce infrastructure requirements — for example, preparation sessions could be delivered to some extent through digital platforms that provide patient education and support. As the result of perceived safety concerns with psychedelic-assisted therapies, increased regulatory scrutiny means both of these changes are likely to occur on a longer timeline of approximately five to six years. Digital approaches in particular are likely to enhance rather than completely replace the role of the therapist.

Next-generation psychedelics

The capacity model outlined above, along with its associated delivery challenges, is based on the use of hallucinogenic compounds sometimes referred to as first-generation psychedelic drugs. Second-generation psychedelics may have modified safety profiles or a decreased duration of action, which could decrease the required duration of dosing sessions and level of supervision. Third-generation psychedelics with reduced or eliminated hallucinogenic effects could allow for an entirely different treatment paradigm with significantly reduced psychological support requirements and at-home delivery options. The efficacy of these non-hallucinogenic compounds has yet to be demonstrated, and this generation of psychedelics may best suit a different population of patients — for example, the neuroplastic effects of psychedelics could have greater significance for patients with Alzheimer’s disease or migraine whereas the hallucinogenic experience may be central to efficacy in psychedelic treatments for mental health conditions.

Conclusion

L.E.K. anticipates significant — though not insurmountable — challenges in the commercialisation of psychedelic drugs, rooted in part in the scale of capacity required. Due to the highly regulated nature of these drugs, developing the necessary standard and volume of infrastructure will be critical to a successful launch. Meeting this challenge will require investment targeted towards the development of new clinics and the adaptation of existing practices to offer psychedelic-assisted therapy as well as training, ongoing professional development and support for a large number of specialised therapists. 

How can L.E.K. help

As mental health assumes an increasingly prominent role in the healthcare system, we help organisations address a range of key issues, creating value for our provider clients and across the investment landscape. We help clients with their commercial and growth strategy, supporting them in growing sectors such as psychedelic drugs. Our approach helps organisations consistently make better decisions, deliver improved business performance and create greater shareholder returns.

To find out more and for a further discussion, please contact Adrienne Rivlin, Partner or Jess Sharpe, Senior Associate Consultant.

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