F-1/A: Psyence Biomedical Registers 50M Shares for Resale

Psyence Biomedical Ltd. files an amended registration statement to allow White Lion Capital to resell up to 50 million common shares, potentially impacting market price.

Summary

• Psyence Biomedical Ltd. (PBM) is a clinical-stage biotechnology company focused on developing natural psilocybin and ibogaine products for psychological trauma in palliative care.
• The company filed an Amendment No. 2 to Form F-3 on Form F-1 to register an additional 50,000,000 common shares for resale by White Lion Capital, LLC.
• PBM has an equity line of credit (ELOC) with White Lion Capital for up to $25 million, of which $14,026,983 has been sold to date, leaving $10,973,107 available.
• PBM reported a net profit of $1,011,790 for the year ended March 31, 2025, a significant improvement from a net loss of ($51,159,048) in 2024, primarily due to fair value gains on convertible debt and warrant liabilities.
• Cash and cash equivalents improved significantly to $6,171,130 as of March 31, 2025, from $762,799 in 2024, with a positive working capital of $5,965,908.
• A Phase IIb clinical trial for PEX010 (25mg naturally sourced psilocybin) for Adjustment Disorder (AjD) due to incurable cancer in palliative care is expected to commence enrollment in the second half of 2025 in Australia, with an estimated cost of $4,500,000 for 87 participants.
• Dr. Neil Maresky transitioned from Chief Executive Officer to Global Head, Clinical Development, and Mr. Jody Aufrichtig assumed the role of Chief Executive Officer, effective October 9, 2025.
• The company invested an additional $3,500,000 in PsyLabs Limited on September 1, 2025, and secured exclusive rights for pharmaceutical-grade, nature-derived ibogaine from PsyLabs.

Sentiment

Score: 6

Explanation: While the company achieved a net profit and significantly improved its cash position, primarily due to non-operating fair value adjustments, and is progressing with its Phase IIb trial, the substantial potential dilution from the White Lion Capital resale and the ongoing need for significant future funding present considerable risks. The first-mover advantage in a nascent market is positive, but regulatory and commercialization uncertainties remain high.

Positives

• Achieved a net profit of $1,011,790 for the year ended March 31, 2025, a substantial turnaround from a $51,159,048 net loss in the prior year.
• Significantly improved cash and cash equivalents to $6,171,130 as of March 31, 2025, from $762,799 in the prior year, and established a positive working capital of $5,965,908.
• Successfully extinguished convertible note liability and promissory notes, recognizing fair value gains of $3,357,628 and $705,565, respectively.
• Secured an equity line of credit (ELOC) with White Lion Capital for up to $25 million, with $10,973,107 still available for future funding.
• The Phase IIb clinical trial in Australia for PEX010 has received all ethics approvals and is expected to commence enrollment in the second half of 2025.
• The Australian R&D tax incentive program offers up to a 43.5% rebate on R&D expenses, making the clinical trial more cost-effective.
• PEX010 has received regulatory approval for Phase I and II clinical trials in multiple jurisdictions (FDA, Health Canada, MHRA, EMA, TGA) and has been administered to 132 real-world patients via Health Canada's Special Access Program with no serious adverse events reported.
• Secured exclusive IP licensing agreements with PsyLabs for pharmaceutical-grade psilocybin for Alcohol Use Disorder (AUD) and Substance Use Disorder (SUD), and a right of first refusal for ibogaine.
• Management believes the company has a first-mover advantage in the palliative care and cancer-related Adjustment Disorder (AjD) market upon approval, as there are no currently FDA-approved pharmaceutical agents for AjD.

Negatives

• The potential offer and resale of 50,000,000 common shares by White Lion Capital represents vastly more than the 1,872,051 outstanding common shares, which could significantly depress the market price and impair the company's ability to raise future capital.
• The company has a limited operating history and has never generated revenue, with expectations of continuing losses and negative cash flows for the foreseeable future.
• Significant dilution risk for existing shareholders due to the potential sale of 50,000,000 shares by White Lion Capital and the exercise of outstanding warrants.
• Substantial additional funding will be required to achieve business goals, and there is no guarantee that financing will be available on acceptable terms or at all.
• Reliance on licensed intellectual property (PEX010 license for Phase IIb expires April 2027) and dependence on third-party manufacturers and CROs introduces supply chain and operational risks.
• The FDA may not accept data from clinical trials conducted outside the United States, potentially requiring additional costly and time-consuming trials.
• There is a high rate of failure for product candidates in clinical trials, and preclinical/earlier clinical results are not necessarily predictive of future outcomes.
• The psychedelic therapy industry and market are relatively new, with uncertain growth and potential negative public opinion or perception.
• The company does not currently own any patents for naturally occurring psilocybin itself, relying on patents for formulations, methods of use, and extraction processes, which may be challenged or circumvented.
• Operating as a foreign private issuer and an emerging growth company means the company is subject to reduced reporting requirements, potentially affording less protection or information to investors compared to U.S. domestic issuers.

Risks

• Ability to maintain Nasdaq listing and potential volatility of securities, including as a result of issuances under the White Lion Purchase Agreement and other financings.
• Ability to retain and attract key personnel and directors.
• Business, operations, and financial performance, including the timing, initiation, progress, and results of clinical trials and preclinical studies.
• Lack of products approved for commercial sale and ability to obtain, and the timing of, regulatory approvals for product candidates.
• Risks related to developing, handling, storing, transporting, and administering controlled substances and complying with required approvals, licenses, and permits.
• Reliance on, and ability to obtain and maintain, rights under licenses to third-party intellectual property and technologies.
• Ability to manufacture or obtain sufficient clinical and, if approved, commercial supply that complies with current good manufacturing practices, and dependence on third-party manufacturers, suppliers, and contract research organizations.
• Ability to commercialize any product candidates, if approved, including market acceptance, pricing, reimbursement by third-party payors, and the size of the addressable market.
• Dependence on collaborations, strategic alliances, and other relationships.
• History of losses and expectation of continuing losses and negative cash flows for the foreseeable future.
• Need for additional capital and the risk that financing may not be available on acceptable terms or at all.
• Ability to develop, maintain, and improve disclosure controls and internal control over financial reporting.
• Changes in laws, regulations, and policies applicable to the industry and business (including clinical, regulatory, data privacy, anti-corruption, sanctions/export, and controlled-substance regimes).
• Competitive pressures and technological change in the psychedelic therapy and biotechnology industries.
• Litigation, administrative proceedings, and ability to protect and enforce intellectual property rights and defend against claims of infringement.
• Macroeconomic and market conditions, including inflation, interest rates, banking sector volatility, supply-chain constraints, and geopolitical events.
• Risks related to operating as a foreign private issuer, including exposure to foreign currency fluctuations and differing reporting and corporate governance standards.
• The securities being offered represent a substantial percentage of outstanding common shares, and sales could depress the market price.
• Failure to meet applicable continued listing requirements could lead to Nasdaq delisting.
• Market price and trading volume of common shares may be volatile and could decline significantly.
• Public Warrants are exercisable for common shares, which would increase shares eligible for future resale and result in dilution.
• Requirements of being a public company may strain resources and divert management's attention.
• Reporting financial results under IFRS, which differs from U.S. GAAP, may make comparisons difficult.
• Difficulties in protecting interests and limited ability to protect rights through U.S. courts due to Canadian incorporation and majority of operations/management outside the U.S.
• Canadian legislation and Articles of Incorporation may delay or prevent a change in control.
• No expectation of paying dividends in the foreseeable future.
• Supply chain interruptions due to few licensed suppliers of input materials.
• Proprietary information loss or security breaches.
• Increased enforcement and/or litigation risks associated with the psychedelic therapeutics industry.
• Inability to realize benefits from future acquisitions or strategic alliances.
• FDA may not accept data from non-U.S. clinical studies.
• High rate of failure for product candidates in clinical trials.
• Preclinical and earlier clinical trial results are not necessarily predictive of future results.
• Negative results from clinical trials of others or adverse safety events could harm the business.
• Dependence on patient enrollment in clinical trials.
• Inadequate or expensive insurance coverage.
• Certain significant personnel may allocate time to other businesses, causing conflicts of interest.
• Loss of future Australian R&D tax incentives.
• Clinical trials are expensive, time-consuming, uncertain, and susceptible to change, delay, or termination.
• Serious adverse events or other safety risks could require abandonment of development or limit approval.
• Voluntary suspension or termination of clinical trials.
• Success of product candidates is subject to constantly-evolving laws and regulations pertaining to psilocybin.
• May not receive fast track, breakthrough therapy, or priority review designations.
• Accelerated approval pathway may not lead to faster development or approval.
• Psychedelic therapy industry and market are relatively new and may not grow as anticipated.
• Negative public opinion and perception of the psychedelic industry.
• Expansion of psychedelics in medical industry may require new clinical research.
• Psychedelic therapy industry is difficult to quantify, and investors rely on their own estimates of market data accuracy.
• Inability to adequately protect or enforce intellectual property rights.
• Risk of infringing third-party intellectual property.
• Inability to prevent disclosure of trade secrets.
• Future sales of securities by existing holders could cause stock price to decline.
• Requirements of being a public company may strain resources and divert management's attention.
• Reduced SEC reporting requirements as an emerging growth company may make common shares less attractive.
• Loss of foreign private issuer status would require compliance with domestic reporting regime.
• Classification as a passive foreign investment company (PFIC) could have adverse U.S. federal income tax consequences for U.S. taxpayers.

Future Outlook

Anticipates increased R&D expenditure as the new CRO advances the clinical trial and expects general and administrative costs to remain elevated due to public company operations. Believes a positive Phase IIb study outcome may allow direct progression to a Phase III trial in the United States, subject to FDA review, but FDA acceptance of non-U.S. data is not guaranteed. Plans to expand targeted indications beyond cancer-related Adjustment Disorder to other types of AjD and secondary indications, including Alcohol Use Disorder (AUD) and Substance Use Disorder (SUD). Expects the number of clinics providing psilocybin-assisted psychotherapy (PAP) to grow significantly upon regulatory approval of the first psychedelic. Does not intend to pay cash dividends in the foreseeable future, prioritizing funding for business development and growth. Expects existing cash to fund operations beyond 12 months.

Management Comments

• We are a life science biotechnology company that, through our operating subsidiary, Biomed II, is developing natural psilocybin and ibogaine products for the healing of psychological trauma and its mental health consequences in the context of palliative care.
• We strive to set the global standard for excellence and consistency in drug development using nature-based psilocybin and ibogaine products.
• Psyence's priority is developing pharmaceutical grade psilocybin and ibogaine to help heal psychological trauma and the diagnosable disorders that can result therefrom, including Adjustment Disorder (AjD), alcohol use disorder (AUD), other substance use disorders (SUDs), anxiety, depression, post-traumatic stress disorder (PTSD), and grief and bereavement, especially in the context of palliative care.
• Outsourcing the study to a CRO assists the company in operating in a more capital efficient manner without the overhead of in house resources.
• If the outcome of the Phase IIb Study is positive, we believe we may be able to proceed directly to a Phase III trial in the United States, subject to FDA review and the opening of an IND; however, there is no guarantee that the FDA will accept data from trials conducted outside of the United States.
• We believe that the competitive landscape analysis of other commercial psychedelic-assisted treatments in clinical trials strongly suggests that Psyence's clinical asset has a first-mover advantage in both the palliative care and cancer-related AjD market upon approval.
• The principal marketing message will be to offer patients a better quality of life for their remaining years with a single administration of the Proposed End Product within a PAP.
• It has been shown that patients in palliative care who are less anxious or depressed utilize fewer healthcare resources, which is an aspect that will help justify the costs of the PAP.
• As the psilocybin industry continues to evolve, we believe that it is likely that there will be demand for both naturally derived psilocybin formulations as well as synthetic psilocybin (and derivatives) due to both the increasing demand in psilocybin-based research and more importantly, patient accessibility of psilocybin medicines.
• Management mitigates the risk of adverse exchange rate movements by holding funds in US dollars.
• Management considers its approach to capital management to be appropriate given the relative size of the Company.

Industry Context

The psychedelic therapy and biotechnology industries are experiencing rapid growth and significant change, leading to increased competition and strategic alliances. There are currently no FDA-approved pharmaceutical agents for Adjustment Disorder (AjD) in palliative care, positioning Psyence Biomedical for a potential first-mover advantage. The FDA's breakthrough therapy designation for psilocybin in severe depression and the EMA's PRIME program indicate a regulatory trend towards expediting innovative medicines for unmet needs. The palliative care market is large and projected for robust growth (9.4% CAGR), offering a significant target for the company's products. However, the industry faces challenges from psilocybin's controlled substance status and potential negative public perception. Research into psychedelic therapies is still in early stages, and the nascent market lacks established benchmarks, requiring investors to rely on their own estimates.

Comparison to Industry Standards

• The company believes its clinical asset has a first-mover advantage in the palliative care and cancer-related AjD market upon approval, as there are currently no FDA-approved pharmaceutical agents for AjD.
• PEX010 has received regulatory approval to proceed into Phase I and II clinical trials in several jurisdictions worldwide (FDA, Health Canada, MHRA, EMA, TGA), indicating it meets initial regulatory standards for clinical development.
• PEX010 is being administered to real-world patients via the Health Canada Special Access Program, with 156 doses administered to 132 patients as of July 17, 2024, without serious adverse events, suggesting a favorable safety profile in a real-world setting.
• The HAM-A scale, an FDA validated endpoint, will be used as the primary endpoint in the Phase IIb study, aligning with recognized clinical trial standards.
• The decision to conduct the Phase IIb study in Australia was influenced by the Australian Federal Government's R&D tax incentive program (up to 43.5% rebate), indicating a strategic choice for cost-effectiveness compared to other jurisdictions like the UK.
• Psilocybin has been found to be of very low toxicity in humans and research animals, and is rated as one of the least harmful recreational drugs, according to available literature, which compares favorably to other substances.
• Previous palliative care clinical trials at New York School of Medicine and Johns Hopkins University School of Medicine, using similar psilocybin-assisted psychotherapy (PAP) doses (22 mg/70 kg, 30 mg/70 kg, and 0.3 mg/kg), reported no serious adverse events, providing a benchmark for the safety profile of PAP.
• Academic studies have demonstrated expeditious, substantial, and sustained improvements in cancer-related anxiety and depression, existential distress, quality of life, and orientation toward death with PAP, suggesting a high efficacy potential compared to traditional treatments like CBT which are less effective for depressive symptoms.
• The company's IP strategy focuses on formulation, dosage, administration, and therapy modules, acknowledging that naturally occurring psilocybin cannot be patented, which is a common industry challenge for natural compounds.
• The company's bylaws require a quorum of two shareholders holding 25% of voting shares for general meetings, which is less stringent than Nasdaq's requirement of one-third, reflecting a home country practice as a foreign private issuer.

Management Changes

Corporate Governance

Legal Proceedings

• Not aware of any pending or threatened litigation or proceeding involving any directors, officers, employees, or agents where indemnification would be required or permitted.
• Could be sued and held liable for harm caused to patients if product candidates cause serious or unexpected side effects.
• May face litigation, administrative proceedings, and challenges to its intellectual property rights.

Related Party Transactions

• On August 15, 2025, entered into a subscription agreement with PsyLabs Limited to acquire 1,750 shares for $3,500,000, which closed on September 1, 2025.
• On April 15, 2025, signed a subscription agreement to subscribe for an additional 250 shares in PsyLabs Ltd for $500,000 cash, which closed on June 30, 2025.
• Certain executives (Executive Chairman, CFO, General Counsel, CEO) and an independent director provide consulting services to PsyLabs in exchange for consulting fees, collectively owning less than 5% of PsyLabs shares.
• On September 17, 2024, acquired 1,000 ordinary shares of PsyLabs from Psyence Group Inc. (PGI) for 35,594 common shares of PBM (total fair value $722,033).
• On September 3, 2024, entered into a license agreement with PsyLabs UK for exclusive, worldwide, royalty-bearing rights to develop and commercialize psilocybin-based APIs for Alcohol Use Disorder (AUD) and Substance Use Disorder (SUD), including milestone payments and a 10% royalty on net sales.
• On January 25, 2024, issued an unsecured convertible promissory note to PGI for $1,610,657, which was fully extinguished by issuing 47,265 common shares in September and October 2024.
• On January 25, 2024, issued an unsecured convertible promissory note to NCAC Sponsor for $1,615,501, which was fully extinguished by issuing 52,275 common shares in September and December 2024.
• Employment and consulting agreements with Jody Aufrichtig, Dr. Neil Maresky, and Warwick Corden-Lloyd detail base fees/salaries, bonuses, and RSU awards.
• Letters of appointment for non-executive directors Christopher Bull, Marc Balkin, and Dr. Seth Feuerstein outline monthly fees and RSU allocations.

Stakeholder Impact

• Shareholders face potential significant dilution from the resale of 50,000,000 common shares by White Lion Capital and the exercise of warrants, which could depress the market price. However, improved financial performance (net profit, increased cash) is a positive.
• Employees and consultants benefit from the 2023 Equity Incentive Plan, offering equity ownership opportunities to attract, retain, and motivate personnel.
• Patients and potential customers may benefit from the development of natural psilocybin and ibogaine products aimed at psychological trauma in palliative care, offering new therapeutic options, with PEX010 already being administered via Health Canada's Special Access Program.
• Suppliers and partners, such as Filament Health Corp. (for PEX010 supply) and Southern Star Research Pty Ltd (CRO), are integral to the company's clinical development, with new partnerships like PsyLabs expanding API sourcing.
• Creditors benefit from the full extinguishment of convertible note liability and promissory notes, reducing debt obligations and improving the company's financial health.

Next Steps

• Commence enrollment for the Phase IIb study in Australia in the second half of 2025.
• Prepare for an end of Phase II meeting with the FDA after the completion of the Phase IIb Study.
• Potentially proceed directly to a Phase III trial in the United States, subject to FDA review and IND opening, if Phase IIb results are positive.
• Engage alternative suppliers for drug product for pivotal Phase III studies and future studies in other indications, following the conclusion of the Phase IIb Study.
• Evaluate the bridging program into Phase III, which will require regulatory agency approval.
• Expand targeted indications beyond cancer-related Adjustment Disorder to address different types of AjD and other secondary indications.
• Consider further indications such as Alcohol Use Disorder (AUD) and Substance Use Disorder (SUD) once the AjD program is ongoing.
• Conduct preliminary market research and initiate the creation of a steering committee for the AUD study.
• Continue to identify, file, prosecute, and maintain the company's patent portfolio, focusing on formulation, dosage, administration, and psychedelic-assisted therapy modules.
• Actively manage key know-how and trade secrets.
• Thoughtfully negotiate in-licensing arrangements of third-party IP rights.
• Monitor the evolution of Australia's regulations pertaining to psilocybin and clinical trials.
• File annual reports on Form 20-F and furnish press releases for financial results and material events on Form 6-K.
• Fill the vacancy on the Board resulting from Dr. Maresky's transition, either by a vote of directors or at the next annual general meeting of shareholders.

Key Dates

Recommendation

The company shows promising developments with a significant improvement in net income and cash position, driven by fair value adjustments and successful debt extinguishment. Progress in the Phase IIb clinical trial for a novel psychedelic therapy in palliative care, coupled with a potential first-mover advantage in an unmet medical need, presents long-term growth potential. However, the immediate and substantial dilution risk from the White Lion Capital share resale, the ongoing need for significant future capital, and the inherent uncertainties of clinical-stage biotechnology and a nascent industry warrant caution. The stock has experienced significant volatility and reverse splits. A 'hold' recommendation reflects the balance between the positive operational and financial improvements and the considerable risks and uncertainties that could impact share price in the short to medium term. Investors should monitor clinical trial progress, future financing activities, and market acceptance closely.

Keywords

Psyence Biomedical, PBM, Psilocybin, Ibogaine, Palliative Care, Adjustment Disorder, Clinical Trials, Biotechnology, SEC Filing, F-1/A, White Lion Capital, Equity Line of Credit, NASDAQ, Pharmaceutical, Mental Health, Drug Development, Reverse Stock Split, Corporate Governance, Risk Factors, Financial Reporting, PsyLabs, API, SUD, AUD