Compass hails psilocybin success in depression study, but investors balk

Shares in Compass Pathways were down more than 44% on Monday even as the company reported that a pivotal Phase III trial of COMP360, a synthetic psilocybin formulation, met its primary endpoint in treatment-resistant depression (TRD). The COMP005 trial is the first late-stage study to report efficacy data for a classic psychedelic compound, the company noted.

The randomised trial enrolled 258 participants with TRD. A single 25-mg dose of COMP360 led to a "highly statistically significant" 3.6-point improvement over placebo on the Montgomery-Åsberg Depression Rating Scale (MADRS) at week six. 

However, ahead of the readout, analysts at Morgan Stanley suggested that "the bar for a clear win" for Compass in the study would be a six-week MADRS separation of at least 5 points in favour of COMP360, as well as no concerning imbalance in suicidal ideation.

The company added that in COMP005, an independent Data Safety Monitoring Board reported no unexpected safety signals or clinically meaningful imbalances in suicidal ideation between groups.

"We are very encouraged by the initial positive results," remarked Chief Medical Officer Guy Goodwin, adding they provide hope for patients "who have been failed by multiple currently approved available treatment options."

Originally slated for release by the end of 2024, the COMP005 data were delayed to the second quarter of 2025. The postponement triggered a 30% workforce reduction and the suspension of all preclinical work outside the COMP360 programme as Compass sought to preserve cash.

In light of Monday's readout, Compass said it now plans to discuss the preliminary data with the FDA, which has not yet reviewed the results. Longer-term 26-week data from COMP005 will be shared once all participants in the parallel Phase III COMP006 trial complete their initial treatment phases. COMP006 is evaluating two fixed doses (25 mg and 10 mg), taken three weeks apart, versus a low-dose control, with a readout expected in the second half of 2026.

The psychedelics sector has faced regulatory headwinds following the FDA's rejection of Lykos Therapeutics' MDMA therapy for post-traumatic stress disorder in August. Compass has adjusted its trial timelines partly due to increased regulatory scrutiny around functional unblinding, a key criticism leveled at the MDMA programme.

COMP005 includes three parts: Part A, which has now concluded and remained blinded through week six; Part B, which will stay blinded through week 26; and Part C, an open-label extension from week 26 to 52. COMP006 is similar: Part A is blinded through nine weeks, Part B remains blinded through week 26, and Part C is an open-label extension running weeks 26 to 52.