Report: Big political giver boosted stake in psychedelic drug treatment research implicitly endorsed by Cameron, then funded anti-Beshear ads
Kentucky Health News
Around the time Attorney General Daniel Cameron implicitly endorsed using 5 percent of the state’s opioid settlements to fund research to win federal approval of a psychedelic drug for addiction treatment, a firm owned by a major national political contributor increased its investment in such research and gave Cameron a political boost, Roger Sollenberger of the Daily Beast reports.
Also at the event was Ben Chandler, president and CEO of the Foundation for a Healthy Kentucky and a former Democratic attorney general and congressman. He applauded the proposal, and later endorsed it, citing the low success rate of drug treatment and recovery. Ibogaine has been reported to relieve withdrawal symptoms, but poses risks to the heart and is legal only in Mexico and New Zealand.
Cameron’s office “provided a 264-word statement expressing confidence in the commission and promoting the Kentucky Opioid Symposium,” Sollenberger reports. “It did not address almost any of the detailed information and questions we provided as the focus of this article. The office did not respond when offered the chance to follow up.”
However, the statement said the work on the synposium “required that certain agenda items be pushed until the commission’s November meeting.” Sollenberger writes that he asked “why the vote on the grant was pushed back to Nov. 15—a week after the election, and more than a month after the symposium.”
Yass, the nation’s fourth-largest political megadonor, “stands to profit massively from ibogaine, especially in the long run,” Sollenberger writes. “Yass’s investment firm, Susquehanna International Group, currently holds around $5 million in ground-floor stakes with four biopharmaceutical firms focused on developing psychedelic addiction treatments. More than $4 million of it lies with two entities leading the charge on ibogaine, according to SIG’s August filing with the Securities and Exchange Commission.
SIG’s total investment portfolio is $491 billion, Sollenberger reports: “If treatments like ibogaine gain traction with the public—and more importantly, with regulators—that niche market, and those holdings, will explode. As The Daily Beast previously reported, the entire purpose of the Kentucky program is to help ibogaine receive federal approval as a ‘breakthrough therapy,’ which would ‘accelerate the regulatory pathway for legal status nationwide.'”
Witnesses from the two firms testified at the opioid commission’s public hearing in July, Sollenbergher notes: “The meeting agenda published by the OAAC only discloses the corporate background of one of them—Dr. Srinivas Rao, co-founder of German biopharmaceutical firm ATAI Life Sciences. The other person in the joint venture, Dr. Deborah Mash, was only identified as professor emerita at the University of Miami School of Medicine, not in her capacity as founder and CEO of DemeRx—where ATAI holds majority control, according to SEC filings. Kentucky Health News reported that affiliation, which was included in a press release about the hearing.
“Two people familiar with the events told The Daily Beast that she stepped down in protest of funding ibogaine,” Sollenberger reports. Walsh told Kentucky Health News in July that she resigned because UK’s largest-ever grant, which she supervises, was extended for two years.
Sollenberger reports, “Yass has stakes in ATAI, which is heavily backed by another billionaire Republican megadonor, Peter Thiel. . . . ATAI also owns a considerable share of another one of Yass’ psychedelic investments, Compass Pathways. According to an SEC quarterly filing submitted in August, after ditching the stock entirely months earlier, Yass’ firm upped its ATAI investment significantly between April 1 and June 30. That filing also shows about $3.6 million in a company called Mind Medicine, which has been conducting ibogaine opioid abatement trials. All of these investments would stand to give SIG exponential returns if regulatory gatekeepers begin to clear the way for ibogaine development—and a partnership with a state government is a major step along that path.”
Sollenberger also reports on “Rex Elsass, an influential longtime GOP strategist and media buyer who has performed millions of dollars of work for Yass-aligned groups. Elsass’ son, Reid, died tragically of an overdose, and his family created a nonprofit called the REID Foundation dedicated to recovery efforts, including emergent therapies.” At the commission’s Sept. 15 hearing, “Elsass, an Ohio resident, spoke movingly at a public hearing in support of ibogaine, reportedly describing himself to the commissioners as ‘your neighbor next door’ without apparently disclosing his long and unavoidably political background.”
Sollenberger adds, “A former adviser at Elsass’ company, The Strategy Group, named Sally Hauser, now heads a group called the Kentucky Ibogaine Initiative, according to her LinkedIn. The nonprofit just registered with Kentucky this year. (Hauser’s position with the group disappeared from her LinkedIn page at some point after The Daily Beast sent out comment requests.)
“Elsass told The Daily Beast in a phone call that, to the best of his knowledge, he had never met Jeff [Yass] in person, and that he had been first tipped to Kentucky’s potential by the Etheridge Foundation, started by folk-rock LGBTQ icon Melissa Etheridge. He explained that his ibogaine advocacy—a ‘miracle medicine that needs to be researched’—is rooted in deep, personal loss and a desire to help mitigate tremendous future tragedy.”
Elsass told Sollenberger, “The solutions just weren’t there, and I was desperate for new methods to help my son. So we looked for other means, and as a result, he ended up in Peru” for an ibogaine treatment. “Plant medicines helped him and extended his life for several years, and left me with a mission.”