Numinus Wellness Strives To Become Psychedelic Research Hub After Acquisition Of Novamind Inc.
In a year where M&A activity is expected to ratchet-up in 2022, Numinus Wellness Inc. (TSE:NUMI) (OTCMKTS: NUMIF) is among the first to take action. In a transaction that checks the boxes for research expansion, growth and scale, the company has acquired Novamind Inc. (CNSX:NM) (OTCMKTS:NVMDF), a psychedelic medicine provider with a network of clinics and clinical research sites. The business combination will create a sizable North American platform with operations spanning 13 wellness clinics, and segues Numinus into the lucrative U.S. market. Numinus CEO, Payton Nyquvest, sat down with TDR to explain the acquisition benefits to the broader investment community.
Apart from an obvious increase in scale—including the inheritance of four clinical research sites and a bioanalytical laboratory—the acquisition will provide a myriad of advantages to propel Numinus Wellness into a leadership position in psychedelic research. The company will inherit a phase II clinical trial investigating psilocybin for major depressive disorder sponsored by the Usona Institute, as well as Novamind’s participation in Mind Medicine’s (NASDAQ: MNMD) phase IIb randomized clinical trial investigating LSD for generalized anxiety disorder.
In combination with Numinus’ ongoing participation in an open-label extension study of MDMA-assisted psychotherapy for PTSD (MAPPUSX) sponsored by Multidisciplinary Association for Psychedelic Studies (MAPS), the company will become a clinical research powerhouse. MAPPUSX is an extension of MAPS’ Phase 3 studies to investigate the safety and efficacy of MDMA-assisted therapy for treating severe PTSD.
The amplification of Numinus’ research capabilities was not lost of CEO Payton Nyquvest, who explained that working with a broad portfolio of compounds will help foster expansion of its clinic model:
For us, it was a big part of why this was a really really great fit for us. And if you look at our research profile now, you know, we’re working (with) ketamine, MDMA, psilocybin, LSD—all the opportunities we have out of the lab with our licensing. And our level of comfort and familiarity with these compounds really sets us in a league of our own.
The bulk of Novamind’s operations are domiciled in Utah, which made headlines last month when the Governor signed a bill to study the use of psychedelics for mental health therapy—including compounds such as psilocybin. In essence, the deal give Numinus a beach head into a state at the forefront of psychedelic research for mental health afflictions. The state’s corporately owned medical apparatus also provides a favorable environment to run profitable business.
On the fiscal side, Numinus Wellness expects the acquisition to expedite its path to profitability through accretive revenue generation and redundant cost savings. The combined entity would have approximately C$10 million in annual pro-forma revenue based on the trailing four quarters—almost four-fifths of that being generated by Novamind with a 47.9% gross profit margin. Numinus projects the acquisition to generate C$3 million in annual cost synergies.
Click on the embedded link to view our newest interview with Numinus Wellness CEO Payton Nyquvest, in his own words.