There Is a Lot of Fungus Among Us

Inside a state-of-the-art lab, tucked in an industrial neighborhood on Vancouver Island in British Columbia, employees wearing protective suits move around two clear boxes, careful not to disrupt the tubes and sensors that keep temperature and humidity constant. Inside the boxes are mushrooms.

But not just any mushrooms. They are psychedelic — “magic” — mushrooms that the start-up Numinus Wellness believes one day may be used to treat mental health conditions as varied as depression, substance abuse and anxiety.

Welcome to the ’Shroom Boom. While Numinus is using mushrooms to make mind-altering therapies, other mushroom growers are promising other benefits, like strengthening immune systems or reducing inflammation. Mushrooms are showing up in all sorts of wellness products, pushing them into the mainstream and making mushrooms a major force in the flourishing, multibillion-dollar wellness market.

It’s hard these days to throw a rock and not hit a mushroom.

A top-selling coffee on Amazon by Four Sigmatic is made with the chaga mushroom, promising immune support and stress relief. Mushroom supplements that claim to support immune systems, reduce inflammation and improve moods can be found in health and wellness stores, but also major retailers like Nordstrom and Urban Outfitters. Om Hot Chocolate says it will help you focus and de-stress. For $96, the Beauty brand Mara sells a vitamin C serum that contains reishi mushrooms that it claims will reduce inflammation.

“As a food, mushrooms have a lot of things going for them in terms of their nutritional value,” said Joshua Lambert, a co-director of the Center for Plant and Mushroom Foods for Health at the Penn State College for Agricultural Sciences. “But one of the things we’re looking into are the other compounds that mushrooms and other plants have that may have significant health benefits.”

The latest frontier for mushrooms could be the most interesting — and the most complicated. Last November, Oregon became the first state to legalize psilocybin, the main active ingredient in “magic” mushrooms, for the treatment of certain mental health conditions in supervised settings. In March, the New York City mayoral candidate Andrew Yang said New York State should legalize psychedelic mushrooms, a stance he raised in 2019 when he was a Democratic presidential candidate.

Regulators in the United States and Canada are taking baby steps toward allowing limited use of psychedelic mushrooms, which produce visual and auditory hallucinations over a few hours after ingestion, for the treatment of certain mental health conditions. Popular as part of the counterculture in the 1960s, magic mushrooms were deemed illegal in the United States in the 1970s.

Investors are taking note. Atai Life Sciences, a German firm developing psychedelic and nonpsychedelic compounds for various mental health conditions, is backed by the billionaire venture capitalist Peter Thiel and others. It filed plans this past week to raise $100 million in a public offering. Another psychedelic company, MindMed, has financial backing from Kevin O’Leary of “Shark Tank.”

In the past year, more than 20 companies focused on psychedelics have gone public, and a dozen more existing public companies have moved into the space, according to analysts at the Vancouver-based investment bank Canaccord Genuity.

“There are currently 100 to 150 clinical trials underway using psychedelic compounds to treat mental and behavioral health conditions,” analysts at Canaccord Genuity wrote in a report in March, adding “the industry has come a long way in the last year, but, there’s still a long way to go.”

Some investors are betting that the psychedelic companies could follow in the footsteps of marijuana, which has been legalized for recreational use in more than a dozen states, including New York in March. But some analysts and many of the companies themselves caution that the path for psychedelics will most likely be very different.

“Psychedelics are about health care, medically approved therapies. It’s not going to go the recreational route that cannabis did,” said Payton Nyquvest, who co-founded Numinus in 2018 and is its chief executive. And while Numinus was the first public company in Canada to harvest the first legal batch of mushrooms from the Psilocybe genus last year, its stock has been stuck trading under one dollar.

Mr. Nyquvest attributed the stock price to the fact that “the sector has only recently come to prominence, and investors are still trying to define how to value companies in the space.”

The current mushroom boom is a surprise to many industry long-timers.

While Europeans and Asians loved the wild mushrooms that Joseph Salvo of Ponderosa Mushrooms harvested all across Canada, he couldn’t drive up any interest among U.S. or Canadian consumers.

Though long loved in Italian pasta dishes, a staple in Japanese soups, and a robust substitution for meat, mushrooms have been a tough sell to U.S. and Canadian consumers. That began to shift about eight years ago when more chefs started using wild mushrooms in cooking shows and such, said Mr. Salvo. Then, Costco began carrying his fresh, in-season chanterelle mushrooms in its stores.

Today, Mr. Salvo grows shiitake, king oyster and other mushrooms in Ponderosa Mushroom’s 28 temperature- and climate-controlled rooms. He also grows shiitake mushrooms outdoors in the logs of alder trees. The mushrooms are shipped to retailers all over the world.

While much of Ponderosa’s mushrooms end up on dinner plates, Mr. Salvo said his mushrooms were also making their way into new, interesting areas, like tea and even beer.

Five hours east of Vancouver in Vernon, B.C., the start-up Doseology Sciences is also focusing on the wellness area. Inside a series of climate-controlled shipping containers that smell of damp, cool soil, Doseology is growing lion’s mane, shiitake and cordyceps mushrooms. A larger facility will be used to grow psychedelic mushrooms when it gets its license to do so, which could happen later this year.

Various mushroom tinctures, serums and powders are finding their way into wellness regimens partly because after decades of relying on pharmaceuticals to control various diseases and conditions, consumers are now increasingly focusing on diet and more natural ways to improve their health, said Dr. Lambert, of Penn State.

Frustration with traditional drugs that did little to address his longtime chronic pain and mental health conditions is what drove Mr. Nyquvest of Numinus to become interested in psychedelic compounds as a treatment.

He points to numerous studies around the benefits of psychedelic mushrooms, including a 2016 study by researchers at Johns Hopkins Medicine that found use of psilocybin relieved anxiety and depression in people with a life-threatening cancer diagnosis. A second, small study involving 24 participants conducted by Johns Hopkins researchers that was published in JAMA Psychiatry found that those who received psilocybin-assisted therapy showed improvement as well.

“The magnitude of the effect we saw was about four times larger than what clinical trials have shown for traditional antidepressants on the market,” Alan Davis, adjunct assistant professor of psychiatry and behavioral sciences at the Johns Hopkins University School of Medicine, said in an announcement about the study’s results.

The Food and Drug Administration has put at least two psychedelic mushroom compounds on the fast track for approval to treat depression.

Last year, Canada began allowing a limited number of people with terminal illness to use psychedelic mushrooms. Currently, Numinus is working toward a psilocybin-assisted therapy trial for patients with substance abuse disorders.

And while regulators in the United States are taking a new look at psychedelic mushrooms, psilocybin is still a Schedule 1 drug and would need to be reclassified by regulators.

Despite those hurdles, though, Mr. Nyquvest sees the potential for a broader use of psychedelic mushrooms around wellness, beyond what he called “treating really heavy indicators” of substance abuse and depression.

“The same way you go to the dentist to take care of the teeth, we need to think about taking care of the brain and mental well being.”