<div id="readability-page-1"><p>While the cannabis industry has all but become legitimate in the United States, it’s not the only form of alternative medicine attempting to break through regulatory barriers. Compounds like psilocybin, lysergic acid and ketamine are all referred to as psychedelics, yet they may have medical applications which are just beginning to be explored.</p>    <p>As such, several newly minted public companies have begun experimenting with ways to harness the therapeutic potential of these compounds. When these companies first went public, the excitement around their projects quickly spiked their trading value followed by a rapid selloff which put most of them in a significant dip.</p>    <p>Yet there are several strong psychedelic stocks to buy on the dip for potentially lucrative returns. That’s because several studies have shown that LSD, psilocybin and ketamine are all exceptionally effective at treating depression when administered in the correct doses. Thus, it may be just a matter of time before these companies have their moment in the sun.</p>    <h2>Atai Life Sciences (ATAI)</h2>    <div id="1617253"><p><img src="https://imageproxy.pbkrs.com/https://investorplace.com/wp-content/plugins/lazy-load/images/1x1.trans.gif?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="300" height="169" original-src="https://imageproxy.pbkrs.com/https://investorplace.com/wp-content/plugins/lazy-load/images/1x1.trans.gif"/></p><p>Source: Shutterstock</p></div><p>A broader play into alternative therapies, <strong>Atai Life Sciences</strong> (NASDAQ:<strong>ATAI</strong>) is currently researching multiple drugs based on psychedelic substances like ketamine, ibogaine and N,N-dimethyltryptamine (DMT). These compounds, while perhaps known for their recreational use have seen several peer-reviewed studies begin to explore their potential for treating mental health disorders.</p>    <p>In the case of ATAI, the company has several drugs derived from psilocybin, ketamine and DMT in the pipeline, with itsmost promising one COMP360, entering Phase 3 clinical trials as part of a co-development with another pharmaceutical company. This wide approach to developing treatment does put a financial strain on ATAI’s operations, but it improves the likelihood of a breakthrough and potential Food and Drug Administration (FDA) approval.</p>    <p>As such, ATAI is one of the best psychedelic stocks to buy on the dip, as it currently trades at a 93% discount on its initial public offering price. Any good news regarding one of its drugs could bolster its value rapidly.</p>    <h2>Compass Pathways (CMPS)</h2>    <div id="1620126"><p><img src="https://imageproxy.pbkrs.com/https://investorplace.com/wp-content/plugins/lazy-load/images/1x1.trans.gif?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="300" height="169" original-src="https://imageproxy.pbkrs.com/https://investorplace.com/wp-content/plugins/lazy-load/images/1x1.trans.gif"/></p><p>Source: Shutterstock</p></div><p>I mentioned earlier that ATAI is developing a drug called COMP360 with another company.<strong> </strong>That company is <strong>Compass Pathways</strong> (NASDAQ:<strong>CMPS</strong>), hence the COMP in the name. This drug is currently the only project in development for CMPS, which means the company represents a very different type of pharmaceutical investment than ATAI.</p>    <p>As such, investing in CMPS means committing to the psilocybin side of therapeutics. With this approach, investors know the direct catalyst relies on FDA approval for COMP360. So let’s talk about the studies behind COMP360. Currently, CMPS offers its Phase IIb datasheet on its site for reference on its drug’s efficacy. The Phase IIb trial focused specifically on patients with depression who were resistant to traditional anti-depressant compounds, meaning drugs like selective serotonin reuptake inhibitors were ineffective. </p>    <p>Of the total participants in the study, 20% reported sustained improvement and therapeutic effects by the 12th week of the study. When you consider that these patients were already exceptionally resistant to treatment, that’s quite impressive. Thus, COMP360 could be worth investing in through psychedelic stocks to buy on the dip such as CMPS.</p>    <h2>Cybin (CYBN) </h2>    <div id="1617247"><p><img src="https://imageproxy.pbkrs.com/https://investorplace.com/wp-content/plugins/lazy-load/images/1x1.trans.gif?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="300" height="169" original-src="https://imageproxy.pbkrs.com/https://investorplace.com/wp-content/plugins/lazy-load/images/1x1.trans.gif"/></p><p>Source: Shutterstock</p></div><p>As the name of the company suggests, <strong>Cybin </strong>(NYSEMKT:<strong>CYBN</strong>) specializes in developing three psilocybin-based therapies, CYB003, CYB004, and SPL028, with other psychedelic compounds in preclinical testing. Currently, the stock trades in penny stock territory at just 26 cents a share, which may concern some investors, but it is important to remember that the trading history of the company is fairly new and its products are still vying for FDA approval.</p>    <p>Moreover, its psilocybin treatment, specifically the Deuterated Psilocybin Program has been granted breakthrough treatment status by the FDA for treating major depressive disorder following its Phase II trial success. This program has also been tested for treating alcohol abuse disorders and could be a breakthrough therapy for that category as well.</p>    <p>In the case of Cybin, investors may want to wait until the company can generate revenue, however. Because it is currently in a growth, research and development phase, the company has only reported losses for the last four quarters.</p>    <p><em>On the date of publication, Viktor Zarev did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.</em></p>    <p><em>On the date of publication, the responsible editor did not have (either directly or indirectly) any positions in the securities mentioned in this article. </em></p> <p>Viktor Zarev is a scientist, researcher, and writer specializing in explaining the complex world of technology stocks through dedication to accuracy and understanding.</p> </div>

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<p>Several newly minted public companies in the psychedelic industry have seen their trading value dip recently. However, there are several strong psychedelic stocks to consider buying on the dip, including Atai Life Sciences (ATAI), Compass Pathways (CMPS), and Cybin (CYBN). These companies are conducting research and development in the field of psychedelic compounds for potential medical applications. ATAI is researching multiple drugs based on psychedelic substances, while CMPS is focused on the development of a psilocybin-based therapy. CYBN specializes in developing psilocybin-based therapies and has received breakthrough treatment status from the FDA.</p>

3 Psychedelic Stocks to Buy on the Dip: Summer 2024