Psychedelic Drugs Market Expected to Reach $2.6 Billion by 2032—Allied Market Research

According to a new report published by Allied Market Research, titled, “Psychedelic Drugs Market," The psychedelic drugs market was valued at $0.7 billion in 2022, and is estimated to reach $2.6 billion by 2032, growing at a CAGR of 13.4% from 2023 to 2032.

Psychedelics are a class of psychoactive substances that alter perception, mood, and various cognitive processes. Psychedelic substances work by affecting the brain's neurotransmitter systems, particularly serotonin, and can lead to a wide range of perceptual and emotional experiences, including vivid visual hallucinations, altered sense of time, and intense feelings of interconnectedness. Psychedelics, when administered in a controlled and supervised setting, may help individuals confront and process deep-seated traumas, gain insights into their thought patterns, and experience profound mystical or spiritual experiences. 

The Psychedelic Drugs Market Trends that drive the growth of the psychedelic drugs market include surge in prevalence of post-traumatic stress disorder, depression and anxiety, and growing research work in the field of psychedelics. In recent years, there has been a noticeable increase in the number of individuals grappling with these mental health conditions. According to a 2023 report by U.S. the National Center for PTSD, world's leading research and educational center of excellence on PTSD and traumatic stress, it was estimated that 6% of the U.S. population will have PTSD at some point in their lives.  

Furthermore, according to World Health Organization, a specialized agency of the United Nations responsible for international public health, as of March 2023, it was estimated that approximately 280 million people in the world have depression. Traditional pharmaceuticals often come with a host of side effects and limitations, leading many to seek alternative therapies.  

Psychedelic substances, such as psilocybin and 3,4-Methylenedioxymethamphetamine, commonly known as ecstasy, have garnered significant attention for their potential to offer breakthrough treatments. Research and clinical trials have demonstrated promising results, showing that these substances, when administered under controlled settings and with therapeutic guidance, can lead to profound and lasting improvements in mental health. Thus, the rise in prevalence of mental illnesses such as post-traumatic stress, disorder, depression, and anxiety is expected to drive the growth of the Psychedelic Drugs Industry. 

Furthermore, the field of psychedelics has witnessed a remarkable resurgence in research and development, emerging as a major driver for the growth of Psychedelic Drugs Market Size. Over the past decade, there has been a notable shift in societal attitudes and regulatory frameworks, allowing for a resurgence in the study of these substances for their therapeutic potential. One of the most significant breakthroughs has been the exploration of psychedelics such as psilocybin and LSD for the treatment of mental health disorders, including depression, anxiety, and PTSD. Clinical trials and studies have consistently demonstrated promising results, suggesting that these substances may offer breakthrough treatments where traditional pharmaceuticals have fallen short.  

According to a 2021 report by National Library of Medicine, world’s largest biomedical library and a leader in research in computational health informatics, it was reported that clinical studies have confirmed the efficacy of ketamine in the treatment of depression. In addition, in 2020, Johnson & Johnson, an American multinational, pharmaceutical, and medical technologies corporation, announced that the U.S. Food and Drug Administration (FDA) has approved the supplemental new drug application (sNDA) for SPRAVATO (esketamine) CIII nasal spray, taken with an oral antidepressant, to treat depressive symptoms in adults with major depressive disorder (MDD) with acute suicidal ideation or behavior. Thus, the rise in the research and development studies of psychedelics is expected to drive the growth of the Psychedelic Drugs Industry. 

However, safety concerns pose a significant restraint for the growth of Psychedelic Drugs Market Size, impeding its widespread acceptance and adoption. While psychedelic substances like psilocybin, LSD, and MDMA have shown promise in various therapeutic applications, there are several safety-related issues, such as unpredictable and intense nature of psychedelic experiences. Hence, long-term effects of regular psychedelic use must be addressed before they can be widely embraced. 

On the basis of drug type, the market is classified into uno ketamine, psilocybin, and other drug types. The ketamine segment holds the largest revenue of the Psychedelic Drugs Market Share in 2022, owing to rise adoption of the ketamine to treat depression and to use of ketamine to induce general anesthesia. However, psilocybin segment is expected to register fastest growth owing to the high research and development on psilocybin to evaluate its therapeutic effects and its use to treat mental illness 

On the basis of application, the market is classified into mental health, abuse disorders, and other applications. The mental health segment was the highest revenue contributor to the market in 2022 and is the fastest growing segment during the Psychedelic Drugs Market Analysis period, due to rise in prevalence of depression, anxiety, and post traumatic stress disorder. However, abuse disorders segment is expected to register fastest growth owing to rise in the number of drug addiction and substance abuse cases. On the basis of end user, the market is categorized into hospitals, mental health center, and other. The mental health center segment holds the largest Psychedelic Drugs Market Share in 2022, owing to the high adoption of psychedelic drugs to treat mental illness in mental health center.  On the basis of region, North America has the highest market share in 2022, and is expected to maintain its lead during the Psychedelic Drugs Market Forecastperiod, owing to rise in prevalence of depression and presence of major key players. However, Asia-Pacific is expected to exhibit the fastest growth during the forecast period, owing to the rise in prevalence of anxiety. 

Key Findings of the Study 

• On the basis of drug type, the ketamine segment was the highest contributor to the market in 2022. However, psilocybin is expected to register the fastest growth during the forecast period. 

• On the basis of application, the mental health segment was the highest contributor to the market in 2022. However, abuse disorders are expected to register the fastest growth during the forecast period. 

• On the basis of end user, the mental health center segment was highest contributor to the market in 2022. 

• On the basis of region, North America generated the largest revenue in 2022. However, Asia-Pacific is anticipated to grow at the highest CAGR during the forecast period