Psilocybin legislation is helping psychedelic drugs make a comeback – a drug researcher explains the challenges they face

An operations manager finds relief from her depression with the help of psilocybin, the primary psychoactive component of “magic mushrooms.” A veteran conquers his post-traumatic stress disorder through therapy using MDMA, a synthetic compound known on the street as “ecstasy” or “molly.” A stay-at-home mom tries LSD, otherwise known as acid, for her anxiety.

Nearly every day, such stories appear about the healing potential of psychedelic drugs.

These stories reflect a so-called “psychedelic renaissance” of the moment — a new interest in the drugs most often associated with 1960s counterculture, but now put to therapeutic rather than recreational ends.

A handful of states, spearheaded by Oregon and Colorado, are leading the way for the legalized use of various naturally occurring psychedelic compounds. In 2020, Oregonians passed Measure 109, which legalized the supervised use of psilocybin and established a novel system for its manufacturing and consumption.

And in 2022, Coloradans passed Proposition 122, the Natural Medicine Health Act, which created a psilocybin program similar to Oregon’s. So far, Oregon and Colorado are the only states that have enacted such programs, but many other states are considering bills that would do so.

As a drug researcher, I have been conducting interviews with psilocybin facilitators, service center owners, manufacturers, researchers and policymakers in Oregon. My goal is to get their perspectives on the benefits and drawbacks of their state’s model for psilocybin legalization.

Adult, not medical, use

Oregon’s Measure 109 instituted a strict “adult use” program, meaning that anyone 21 years of age or older can access psilocybin treatment without any medical diagnosis.

Under this program, consumers must purchase psilocybin through a state-licensed service center, where they must also ingest it in the presence of a state-licensed facilitator. Facilitators are licensed through state-approved training institutes and do not need any specific medical background. Only natural, mushroom-derived psilocybin — as opposed to the synthetic psilocybin that pharmaceutical companies like Compass Pathways are developing — is allowed. The first class of facilitators graduated in spring 2023, and the first service center opened that summer.

The licensing process for facilitators is not onerous — one must have a high school diploma or equivalent and a relatively clean criminal background, and must complete a 160-hour, state-approved training, which includes 40 hours of hands-on experience. This ease of obtaining a license to practice was by design: Measure 109’s architects wanted to make room for people from a variety of backgrounds to become facilitators. “Certain people are amazing at what they do, and school might not be the pathway for them,” one facilitator told me.

Still, many service center owners and facilitators feel that additional credentials or training would be useful. One of my interviewees suggested that some courses in the required training could be taught by a psychiatrist or neurologist, since many clients who come in for psilocybin services have existing mental health diagnoses and already may be taking a variety of psychopharmaceutical medications.

What psilocybin costs

As everyone I interviewed recognized, the primary problem with the Oregon model has to do with cost. It is estimated that the average journey costs about US$1,500. That includes $500-$2,000 for the facilitator, $300-$600 for the room, and $150-$200 for the psilocybin itself. For more intensive facilitation at pricier facilities, costs can be upward of $5,000 per journey.

Part of the exorbitant cost lies in startup fees, which are significant. The architects of Measure 109 wanted the state’s psilocybin services office to be self-funded. As a result, annual license fees for facilitators ($2,000 per year), service centers ($10,000 per year) and manufacturers ($10,000 per year) are relatively high. Special manufacturing equipment and high taxes further increase costs.

All of this translates to higher prices for consumers, who have not flocked to psilocybin service centers at the expected volume. The overwhelming majority of psilocybin treatment clients come from out of state, possibly due to the fact that most Oregonians can easily procure psilocybin at a lower cost outside of the legal market.

One service center owner told me: “We don’t have a really scalable or profitable model. It’s very labor intensive on the facilitator side. Investors are typically looking to make five times their money, and they don’t see how that can happen with the way the current industry is structured.”

Other state paths for psilocybin legalization

The second state psilocybin program to come online will be in Colorado, where the Natural Medicine Health Act was passed in 2022.

For now, “natural medicine” for legal treatment refers only to psilocybin, but the act could be expanded in the future to include DMT, ibogaine and mescaline, other naturally derived psychedelic drugs.

In contrast to Oregon’s program, which created a single facilitator license, Colorado’s Prop 122 establishes a tiered approach to facilitator licensing, with one path for those with clinical degrees and one for those without. Prop 122 also decriminalized the possession, use, cultivation, manufacturing and even sharing of natural medicine for “personal use.”

Other states have considered similar programs, but none have yet passed into law. Two psychedelic bills recently failed in California. In Arizona, Democratic Governor Katie Hobbs vetoed a bill in June 2024 that would have allowed psilocybin treatment and testing in the state. The bill was sponsored by Republican Senator T.J. Shope.

For the most part, however, such bills have support on both sides of the aisle, which is one indication that state-level psilocybin legislation is likely to advance in the coming years. This will happen in tandem with developments at the Food and Drug Administration, which has already granted multiple psychedelic drugs “breakthrough therapy” status, a designation that accelerates the drug development and review process.

Developments at the FDA

Large pharmaceutical companies like Johnson & Johnson are investing in psychedelic drug development, but the nascent industry is really being driven by smaller market disruptors like Compass and MindMed, both of which are seeking FDA approval for their own patented psychedelic formulations.

Many experts in the industry believe that the FDA will approve certain psychedelic drugs, including synthetic psilocybin, in the coming years. As the Oregon and Colorado programs only work with natural substances, and as any FDA-approved psychedelics would likely only be able to be prescribed by medical professionals, synthetic psilocybin would not be used at service centers under present law.

The development of the market for potentially FDA-approved psychedelics thus represents a parallel track for the psychedelic renaissance. Some of my interviewees predicted eventual conflict between the state-level legalization track and that of FDA-approved drugs, but my research suggests that this conflict will not come to a head for many years.