PharmAla, Psyched Wellness Raise Funds

June 14, 2023 · Green Market Report

Both companies plan to use some of the proceeds to further their research.

While funding for psychedelics companies may be becoming more scarce, at least two firms have managed to successfully initiate rounds recently.

PharmAla

Psychedelic drug company PharmAla Biotech Holdings Inc.  (CSE: MDMA) (OTC: PMBHF) announced a non-brokered private placement of a minimum 3,333,333 units and a maximum 16,666,666 units of the company at a price of $0.30 per unit for gross proceeds of a minimum of $1 million and a maximum of $5 million. Shares of PharmAla were lately selling at $0.33 per share.

PharmAla said it plans to use the money raised to increase its inventory of MDMA and psilocybin for future sales. In addition to increasing inventory, the company will also use some of the proceeds for its phase 2 clinical trials and general working capital purposes.

The shares will be offered for sale to purchasers who reside in Canada (except Quebec) and/or other qualifying jurisdictions pursuant to the listed issuer financing exemption under Part 5A of National Instrument 45-106 – Prospectus Exemptions.

PharmAla said it may compensate certain eligible finders under the LIFE Offering and may pay a cash commission of up to 7% of the gross proceeds of the LIFE Offering and issue such number of finder’s warrants equal to 7% of the total number of units issued under the LIFE Offering.

At the beginning of May, PharmAla reported its earnings for the quarter ending February. At that time, the company wrote in its filing that it had a cash balance of $731,722 (August 31, 2022 – $852,138). It noted that it was a going concern dependent upon its ability to develop and maintain profitable operations or to obtain additional financing.

Psyched Wellness

Psyched Wellness Ltd. (CSE: PSYC) (OTCQB: PSYCF) reported that it closed the initial tranche of its previously announced non-brokered private placement. The company has issued 9,585,000 units  at a price of C$0.07 per unit for gross proceeds of US$500,000, approximately C$670,950.

In connection with closing the initial tranche, Psyched Wellness, Gotham Green Fund III L.P., and Gotham Green Fund III (Q) L.P.  entered into an investor rights agreement dated June 12, 2023, which replaces the term sheet. The agreement states that Gotham will have the right to designate one director to become a member of the board – and for now that person is Harrison Aaron. If tranche two closes, Gotham will get to add two more board members.

Two weeks ago Aaron said, “Psyched Wellness’s work over the past four years has been ground-breaking, with the company developing its proprietary extract of the federally legal amanita muscaria mushroom, AME-1, and proving its safety for human consumption through extensive studies and United States GRAS certification. With this proposed investment, we would aim to fund and facilitate the nationwide rollout of mainstream consumer products centered around AME-1, and we look forward to working closely with the company.”

Psyched also noted that it has entered into new employment agreements with Chief Executive Officer Jeffrey Stevens and Chief Operating Officer David Shisel.

“Attracting this prospective majority investment from Gotham Green Partners is a clear validation of what we’ve accomplished to date in pioneering a legal path to market for products derived from the Amanita Muscaria mushroom,” Stevens said. “We believe that the closing of this strategic investment would ensure the company is able to capitalize upon its first-mover advantage and fund its next stages of growth, with the scale of the proposed US$7,500,000 (approximately C$10,217,250) capital infusion demonstrating the scope of the opportunity both parties see for AME-1 and other Amanita Muscaria products within the mainstream consumer packaged goods space.” (Full Story)

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