What the Beckley Waves Acquisition of Nue Life Means for the Psychedelics Industry

It’s been 25 years since Amanda Feilding founded the Beckley Foundation, named after Beckley Park, the English country house near Oxford where the foundation has its headquarters. From that site, Beckley has been one of the leading forces behind the research, medicalization and mainstreaming of psychedelics. As the potential for a psychedelics industry emerged, Feilding co-founded Beckley Waves, the industry’s first venture studio. Beckley Waves was in the news last month following its acquisition of Nue Life, a telehealth ketamine provider. Lucid News spoke with Daniel Love, co-founder and partner of Beckley Waves, and now interim CEO of NueCo Holdings PBC, about the acquisition and what it says about the changing state of the psychedelics industry. This interview was edited for concision.   

Lucid News: What made acquiring Nue Life attractive to Beckley Waves?

Daniel Love: When we think about the Beckley landscape, there’s the Beckley Foundation, which is purely nonprofit research and policy. There’s Beckley PsyTech, which is strictly drug development. And there’s Beckley Waves, which focuses on the care delivery infrastructure. Not biotech. Everything else. What are all the ancillary parts that need to happen for this to be a healthy, robust infrastructure? Our mission at Beckley Waves is to think about how to build the care delivery system infrastructure for the global psychedelic ecosystem – which means to increase safe and legal access. That could be insurance, training, clinics, retreats, all of the systems that need to happen. That’s why we exist, at the end of the day. 

Nue Life helps further the mission on two fronts. One is that it provides a way of offering access to ketamine-assisted therapy at a much lower cost. And two, we think that the Nue Life infrastructure will enable others to use our platform to offer integration and support.  

Can you say more about Nue Life’s infrastructure?

We have an app and a support service that currently allows us to work with other therapists and providers. For example, we have agreements in place with existing providers: they prescribe ketamine; we offer support that includes coaching and integration. We can onboard clients, give them a clinical consultation, and then they can go through our process, working with our coaches and integration support specialists to go through our protocol. There are one-on-one coaching health sessions, preparation groups, and integration groups. Then there’s a lot of tools, content and support on the app, like meditation, music, journaling.

Nue Life offers an at-home ketamine program, prescribing via telehealth and mailing lozenges to clients without either the screenings or follow-up sessions in person. Considering the addictive potential of ketamine, did that give you any pause?

I was frankly worried about the risks of at-home ketamine. One thing that made me more comfortable was that the team has taken a very thoughtful approach. This comes down to two things. One is the potential for abuse. I think that potential can be addressed through strict screening, and clear caps on the dosing level and the number of sessions. We only provide up to six doses, and not in one go. They come in two increments, two lozenges followed by four lozenges. Some other companies send much bigger packages, 18 or 24. We also have things like taking a picture of your dose and submitting it. Safeguards are in place that we think make it safer and help prevent abuse.

The other concern is the potential for adverse events. There are two studies, one published by Nue Life and one by Mindbloom. The top line was that there seems to be minimal risks for adverse events compared to other things at home.

Telehealth should reduce the price compared to in-person services, right?

At the end of the day, you can’t talk about access and equity without talking about cost. We are all on team MAPS 100 percent, rooting for MAPS. At the same time, their approach is not inexpensive. We have to look at all kinds of alternatives that are effective and can be provided now. Our offering is $1,000 to $1,400. In-person dosing at a ketamine clinic is usually $4,500 to $6,000.

Does that include therapy?

We do not have therapists. We have integration specialists and coaches. Client support can include individual sessions as well as group sessions, which they can use as much as they want. This comes back to why Nue Life is interesting for Beckley Waves. We have Beckley Academy, which focuses on training. We can give therapists some training experiences through Nue Life. We’re not there yet, to be clear, but putting these pieces together is where we will go.

Regarding access, the other key piece is reimbursement. It seems that the path to reimbursement with ketamine assisted therapy, either with payers or employers, is much nearer at hand. If we really want to talk about access, we have to break into the traditional healthcare system, while at the same time offering alternative models to the shortcomings in today’s health system.

As other options for psychedelic therapies become legal, is the intention to introduce them into the product offering?

Yes, 100 percent. I think that’s why the platform is interesting. It can be totally medicine agnostic. But we’re not there yet. And it’s not likely that psilocybin or MDMA at-home therapy is on the near term horizon. But still, how do you provide wraparound support? How do providers collect data to support clients? We can partner with providers that offer in-person care, so they can have wraparound support.

You’ll be collecting a lot of data. Privacy is a big concern in the psychedelic space. How is the data collection being done and how will it be used?

The question is: how do we get better? That requires using data to understand: this is the client, this is what people like him look like, and how can we improve upon that and make it better? We use a generalized anxiety disorder screener, the PHQ-9, which is a self-reported survey on anxiety. We use a few others, as well. Those are the kinds of primary data points. Regarding privacy, the HIPAA protocols are in place.  

Nue Life had announced that it raised about $28.2 million over five raises. I don’t think that includes the acquisition.

Correct.

There’s been talk that Nue Life faced bankruptcy. Can you discuss the terms of the acquisition?

I cannot.

Nue Life is privately held, not a public company, so you don’t have to share that information. But the acquisition has occurred during a period of consolidation in the psychedelics industry. A lot of capital was invested into the space, and many of the companies that received capital are now facing financial challenges. How do you see the landscape today and where things are heading?

I saw data from CB Insights, which said some $650 million went into the space in 2021, and for the first six months of this year the number was $21 million. So massive drop off, right? The macro climate has shifted. This is not just psychedelics. The entire tech sector was hit pretty hard. We moved into a kind of risk-off environment, which means that startups in an emergent, unknown space like psychedelics had a double whammy. So you saw this huge contraction.

At the same time, I think some of this was actually good news. You had a lot of nonsense going on, companies that were listing in Canada with only a deck and a presentation. I don’t think that was good for the sector, writ large. Some of the business models were not sustainable. I think psychedelics probably follows health services as a model more than tech, in some ways. And in health services, exponential growth is harder.

Where do I think we are now? It’s funny. We have an investor I just saw. He’s older, a financial conservative, not who you would expect to be a psychedelic investor. But he’s quite mindful and he’s saying, Dan, the genie’s out of the bottle, and once it’s out, it’s very hard to put it back in. I think that’s true. The world has woken up. We have this bleak picture for mental health. COVID For sure exacerbated that. And while it’s not a magic bullet by any means, I do think psychedelics is one of the promising solution sets and tools. And it’s hard to pull that back. There’s like 200 clinical trials underway at 70 universities now. Five years ago it was a dozen.

What does this change in the landscape mean for Beckley?

To a certain extent, this forces a move back to fundamentals and values. There was a lot of money raised for things that didn’t necessarily make sense. Now we’re seeing what’s actually sustainable. This fits with Beckley’s broader ethos. For lack of a better example, I want us to be Patagonia, not Zara. That’s also the type of capital that we attracted, long-term and patient capital that is still for-profit. But we believe in doing things sustainably. Grow more slowly, but do it in a high quality way. This space isn’t going away, it’s too promising on too many fronts. But I do think that it’s going to be the more high quality players who are left. You’re seeing some of that shake out happening now.

For the acquisition, Beckley Waves created a new company, NueCo Holdings PBC.

We purchased the assets of Nue Life Health and put them into a new company. You know, when the market shifted, a lot of companies got caught. The timing of Ryan Haight also threw some curveballs. But when it came down to the foundation of what Nue Life had built, and the vision, to us that infrastructure was compelling.

Do you expect Nue Life to reach profitability soon?

We stepped in and raised capital from our investor base. We feel that we’re now in a solid position and we have time. Our view is not to go back to the go-go growth years, but to grow more slowly and thoughtfully. Meaningful revenue is still there. But I want to be very careful and thoughtful about how we grow. The funding for the holding company came from Beckley Waves, plus a separate SPV for this deal.

The Ryan Haight Act came at the start of the COVID epidemic to allow for the prescribing of controlled medications, including ketamine, via telehealth. It was recently extended until the end of 2024. But will the business model of at-home ketamine hold up after Ryan Haight expires?

I think telemedicine generally is not going to go away. If anything, Ryan Haight will probably be  delayed more. Also, because our model is more conservative, with only six sessions, I think it’s in a safer place. But in this space, there’s no zero risk.

CORRECTION: This article has been updated to reflect the correct number of ketamine lozenges sent by Nue Life to clients; it is two lozenges followed by four lozenges, not two sets of three lozenges.

Photo credit: Image of the Beckley Park topiary by Anders Sandberg – https://www.flickr.com/photos/arenamontanus/3621768823/ used through a Creative Commons license.