Psychedelics Policy Is Shifting In Washington: Here's What One Biotech CEO Sees Coming

Over the past few weeks, a cascade of federal moves has reshaped the conversation around psychedelic-assisted therapy in the United States. What was once a fringe issue is now drawing bipartisan attention—and, increasingly, institutional support.

The clearest signal came from FDA Commissioner Dr. Marty Makary, who recently called psychedelic research a "top priority" for the agency, citing growing scientific validation and unmet needs in mental health. Just days later, Texas lawmakers approved $50 million in public funding for ibogaine trials targeting veterans with PTSD and traumatic brain injury, an unprecedented commitment from a Republican-led state.

Adding to the momentum, the Department of Veterans Affairs confirmed it is exploring psychedelic treatment vouchers for veterans, with VA Secretary Doug Collins telling Congress his agency is seeing "positive outcomes" from ongoing studies. Even HHS Secretary Robert F. Kennedy Jr., a longtime advocate of alternative therapies, has backed legalizing psychedelics in clinical settings.

Now, the federal pivot has taken an even sharper turn: Matthew Zorn, a high-profile attorney known for challenging government secrecy around drug policy, has joined the Department of Health and Human Services as Deputy General Counsel. Internally referred to as the agency's "psychedelics czar," Zorn previously sued HHS to force the release of its cannabis rescheduling review and has represented patients seeking legal access to psilocybin under Right to Try laws.

While Zorn's role does not change regulation in itself, his hiring marks a rare crossover from courtroom adversary to federal policymaker and could accelerate alignment between science, law, and public demand.

Against that backdrop, Doug Drysdale, CEO of Cybin Inc. CYBN, one of the most closely watched companies in psychedelic medicine, told Benzinga the FDA's stance is more than symbolic.

"It is gratifying that the FDA Commissioner shares our belief in the potential therapeutic value of these innovative treatments… We agree wholeheartedly that the time is now to address the mental health crisis, and we applaud Dr. Makary's commitment to expedite the regulatory review process for product candidates in development," said Drysdale.

"We are encouraged by the FDA's stated focus and openness to innovative treatments that show promise, even when they challenge traditional standards of care. This public endorsement that psychedelics are a ‘frontier area' with compelling scientific evidence is welcome validation for the work we are doing."

State Experiments And The Texas Ibogaine Bet

While federal agencies are signaling openness to psychedelic-assisted therapy, states are beginning to take matters into their own hands, sometimes in unexpected ways. In May, Texas became the first U.S. state to approve a large-scale, publicly funded psychedelic research initiative. The $50 million program will support clinical trials using ibogaine, a powerful psychedelic with potential applications for treating opioid use disorder and trauma-related conditions, particularly among veterans.

The move marks a dramatic shift for a state not traditionally associated with progressive drug policy. It also suggests that interest in psychedelics is transcending partisan lines, driven in part by the urgent need for alternative treatments and the growing body of clinical evidence supporting their efficacy.

Drysdale sees Texas’ move as part of a larger trend, not an outlier.

"With growing clinically validated efficacy in treating mental health disorders, federal and state governments are increasingly focused on psychedelics as a potential alternative to further explore," Drysdale said. "We are in the early innings of this paradigm shift. With more clinically validated results, we see increased acceptance of psychedelic-based treatments as a legitimate treatment option for the large class of people who do not respond to traditional treatments."

While Cybin's pipeline is centered on federally regulated compounds like psilocybin and DMT, the Texas initiative could help expand the landscape for psychedelic R&D in the U.S. and bring new public-private partnerships into play.

The Federal Pathway vs. Decriminalization Chaos

As enthusiasm for psychedelics grows, states have begun to explore medical legalization and decriminalization efforts, often in parallel with federal clinical research. Oregon launched the first state-regulated psilocybin service centers in 2023. Colorado is now rolling out its own regulatory framework, and municipalities in California, Michigan and Massachusetts have adopted local decriminalization measures.

But, for companies navigating the biotech approval process, these state-led initiatives present more complexity than clarity. The patchwork of rules, safety standards and oversight mechanisms can dilute public understanding and invite legal ambiguity. For Cybin, the most viable and responsible path forward remains firmly rooted in federal oversight.

"At Cybin, we are focused on pursuing the FDA path because this ensures patient safety and efficacy have been rigorously assessed and if approved, provided the best route to support patient access (i.e. physician / patient information, route to reimbursement and coverage)," Drysdale said.

The distinction matters not only for regulatory alignment but also for long-term access. Federal approval is the clearest path to integrating psychedelic therapies into traditional health systems, where they can be prescribed, reimbursed and standardized at scale.

Regulated vs. Recreational Use

As public interest in psychedelics grows, so does the tension between clinical advancement and recreational experimentation. While some advocates push for broader access outside medical settings, biotech companies like Cybin remain adamant that these compounds must be developed, administered, and scaled under strict scientific protocols.

Drysdale underscored the importance of maintaining a clear line between FDA-reviewed therapies and underground use.

"Maintaining a clear distinction between FDA-reviewed psychedelic therapies and non-medical or underground use is essential," he told Benzinga. "Clinical psychedelic treatments are developed through rigorous scientific processes, including controlled dosing, therapeutic support and long-term follow-up. This ensures patient safety and therapeutic efficacy. In contrast, unregulated use lacks these safeguards and can pose significant risks."

For companies building FDA-regulated programs, public safety is not just a compliance issue: it's foundational to patient trust, provider confidence and long-term viability.

What’s Next: Access, Reimbursement And Real-World Delivery

Despite growing momentum across government and industry, significant barriers remain before psychedelic-assisted therapy can be widely accessed by patients. Regulatory support is only the first step. Broader integration will require updated reimbursement systems, trained providers and public education to counter decades of stigma and misunderstanding.

According to Drysdale, unlocking the full potential of psychedelic medicine will demand coordinated movement across several fronts.

"To bring psychedelic therapies from clinical trials to real-world access, several developments are essential. First, continued regulatory clarity and support from agencies like the FDA and DEA will be critical. Second, payer engagement and reimbursement frameworks must evolve to recognize the value of these treatments. Third, public education and provider training will be key to ensuring safe, effective integration into clinical practice. Finally, ongoing investment in research and infrastructure will help scale access responsibly," he said. "At Cybin, we are working across all these fronts to help realize the full potential of psychedelic medicine."

Whether or not recent political shifts translate into long-term reform, industry leaders are watching closely—and preparing for a future where regulated psychedelics are no longer on the margins of medicine.

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