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Promising science and shared values don’t mean there’s a place for psychedelics in the supplement industry

While innovation is a critical element to the survival of any industry, psychedelics don’t fall squarely into the types of products DSHEA was intended to protect, writes attorney Rend Al-Mondhiry.

Rend Al-Mondhiry

November 7, 2023

11 Min Read
Psilocybin mushrooms
Psilocybin mushrooms

With a following ranging from the medical community to billionaire entrepreneurs to suburban baby boomers and younger generations alike, psychedelics aren’t just “back,” they’re here to stay. Headlines like “Are All the Moms Microdosing Without Me?” in OprahDaily.com tell us how far in from the edges the idea has moved, and even Congress is exploring ways to ease access to these substances, many of which are controlled substances. The allure of psychedelics also appears to make them a perfect fit for the dietary supplements industry—promising, nature-based remedies with seemingly limitless potential to improve our mind, body and spirit. But is there a role for our industry?

And should there be?

The current legal and regulatory constraints—including those in our beloved DSHEA—would argue otherwise. The reputational risk associated with marketing these products is also worth considering, especially for an industry that continues to be plagued with allegations of being unregulated with questionable scientific support for product claims. And, in a space traditionally reserved for ingredients intended to “supplement the diet” and promote good health rather than provide a recreational experience, where do psychedelics fit?

Schedule 1 reality check

Much of the excitement revolves around psilocybin, a naturally occurring, hallucinogenic compound found in certain species of mushrooms. It is currently a Schedule I substance under the Federal Controlled Substances Act, which is defined as a drug with no currently accepted medical use and a high potential for abuse. Despite this designation, the medical community has embraced psilocybin and is exploring its potential to treat conditions such as depression and addiction, often as an adjunct to psychotherapy. Beyond ‘shrooms, other Schedule I substances like DMT (found in Ayahuasca), mescaline (the active constituent in peyote), LSD and MDMA are being investigated as treatments for these and other mental health disorders. Marijuana and THC are also on this list, at least for now.

The Schedule I designation is absolute, meaning there is no threshold or de minimis amount that would make a product containing any of these substances lawful. This is barrier No. 1, and perhaps the most compelling in terms of taking psilocybin and its Schedule I brethren off the table for use in a “microdose” supplement or similar format. Researching or just handling a Schedule I substance requires DEA licensure, so the legal stakes are high. Although state decriminalization of psychedelics has gained momentum in recent years, decriminalization does not equate to legalization; it mainly means that those using the illegal substance for personal use are unlikely to be charged with a crime. Manufacturing and distributing the substance are another story. There is one exception: Colorado and Oregon have actually legalized psilocybin (with Colorado going a step further and legalizing mescaline and DMT for personal use as well) but there are limits. For example, psilocybin can’t be freely sold in these states, and in Oregon it must be used with a licensed facilitator. This is a far cry from full-on legalization, and interstate commerce remains off limits.

Precluded and excluded

Even in the unlikely event that psilocybin is removed from scheduling altogether, there’s yet another legal barrier: DSHEA. The same exclusionary clause that brought down CBD, NAC and, most recently, NMN is at play here. Briefly, this is the language that excludes an article from the FD&C Act’s definition of “dietary supplement” if it was investigated under an IND or approved as a drug. There are two exceptions, but neither appear to be applicable in this case: 1. if the article was (lawfully) marketed as a dietary supplement or food prior to the investigation or approval as a drug; and 2. if FDA issues a notice-and-comment rulemaking finding that the article is lawful for use as a supplement or food. The drug exclusionary clause is a significant roadblock, given psilocybin and other psychedelic substances have already been the subject of Phase 2 and Phase 3 trials, with more likely on the way and drug approvals a definite possibility. In June, the FDA issued its first Draft Guidance on Clinical Trials with Psychedelic Drugs, and last year a letter authored by HHS indicated that FDA approval of MDMA for PTSD and psilocybin for depression could occur within 24 months. It also seems extremely unlikely that the FDA would permit these substances via rulemaking given the potential safety concerns.

At the edges

Some companies have instead taken the approach of marketing dietary supplements as “psychedelic-adjacent” products to enhance psychedelic medicines or minimize the “comedown” that sometimes follows. Others are described as “nature’s MDMA.” However, these products also pose regulatory challenges. Of course, dietary supplements cannot be promoted as alternative to drugs, and, arguably, these products are not affecting the normal structure or function of the body—but augmenting or mitigating an abnormal condition. The FDA’s relatively unknown Guidance on Street Drug Alternatives notes that DSHEA intended for dietary supplements to be used to augment the diet to promote health and reduce the risk of disease. According to the guidance, products intended for recreational purposes that affect psychological states—such as to get high, promote euphoria or induce hallucinations—are not intended to supplement the diet and are therefore not dietary supplements. In past warning letters citing this guidance, the FDA has called out products with names like “SleepWalker Euphoria Awareness Enhancer” and claims such as “Dream on, enjoy having your head in the clouds.” See FDA warning letter to Evol Nutrition Associates (July 10, 2012).

“Psychedelic-adjacent” supplements could also pose a safety risk if the interaction between the supplement product and psychedelic substance isn’t well understood. In addition, similar to its position regarding hangover products, claims to treat or mitigate the effects of drugs like psilocybin or MDMA would likely be considered disease claims (and the products unapproved drugs), given that these substances can cause temporary damage to brain function and impaired judgment, attention, reflexes, etc. Overall, the risks may not be worth the reward, and whether these products can deliver on the benefits promised requires a separate analysis.

The FTC is also here to ruin your vibe

Another regulatory dilemma involves substantiation. Just because psilocybin and other psychedelics hold promise for various mental health disorders doesn’t mean that a microdose will treat more mild conditions, i.e., “provide relief from occasional stress and anxiousness” or a similar structure/function benefit. Often, these substances are not being studied at microdose levels but at much higher doses. The idea of being able to tap into your unconscious to uncover deep-seated, unresolved causes of anxiety is appealing—and perhaps needed in the time we live in—but the idea of microdosing as way to experience “psychedelics lite” has thus far not been substantiated.

It’s a basic tenant of the FTC’s requirements for competent and reliable scientific evidence that a company needs to rely on substantiation that is relevant, so a study showing that a 25 mg “macrodose” of psilocybin can treat PTSD is likely not going to support a claim that a microdose at a tenth of that can provide everyday stress relief. Anecdotal evidence won’t cut it either. The dose, study population, and conditions of use for the product being investigated need to be a good match for the advertised product. So, even if we take away the FDA challenges, substantiating claims in this area may prove to be a significant challenge as well, whether related to microdosing or psychedelic-adjacent products. As a drug, the science on psilocybin points to clear and substantiated benefits. As a dietary supplement, the science is virtually nonexistent, and the legal constraints of such controlled substances are a significant limitation on research for the foreseeable future—similar to what we saw for hemp-derived CBD and other hemp derivatives prior to the legalization of hemp.

Mushroom mania

Despite these regulatory obstacles, it seems that many in the industry are riding the wave of interest in psychedelics and benefiting from it. If you attended any supplement trade event in the past year or two, then you know mushrooms are currently one of the hottest food and supplement ingredients. Functional mushrooms, adaptogenic mushrooms, full spectrum mushrooms—they are everywhere, with much of the hype tied to the explosion of interest in psychedelics and psilocybin specifically. 

Functional mushrooms, like reishi, chaga, turkey tail and lion’s mane, have undoubtedly benefitted from the glow of psilocybin, and these products are in high demand. Like marijuana’s cousin hemp, consumers may think they are tapping into the sultry world of psychedelics, but in reality these mushrooms may be as likely to provide a psychedelic experience as the typical garden-variety mushrooms found on grocery shelves.

Certainly, functional mushrooms hold a lot of promise for a range of cognitive benefits, from memory to focus to stress relief, but the science is still developing for these products. That these mushrooms are getting a marketing boost from the psychedelic movement is also worth noting, especially since some companies are taking this a step further with trippy marketing and even using terms like “microdose” in relation to these nonpsychedelic varieties. Will regulators care that this marketing may be misleading? Probably not, given psychedelic-seeking consumers are hardly the vulnerable populations regulators are looking to protect. It’s also unlikely we will see class action plaintiffs’ attorneys leading the charge against such products. Still, it is deceptive and similar to what we saw in the hemp industry when that plant was first legalized, with companies playing off of hemp’s connection to marijuana and tapping into consumers’ curiosity around mysterious, edgy products that were once illegal.

Another mushroom gaining interest is Amanita muscaria, the highly recognizable red and white mushroom of Alice in Wonderland fame. Although not a controlled substance, at high doses it is hallucinogenic and poisonous. It is currently not a controlled substance at the federal level, and the only state to prohibit this mushroom is Louisiana. A Canadian-based company announced last year that its propriety extract of Amanita muscaria, AME-I, achieved self-determined GRAS status, and claims that its Calm dietary supplement product is the “first legal Amanita Muscaria extract available for sale in the USA.” Several other companies are also selling Amanita muscaria products, including gummies and capsules, although the regulatory status of the key ingredient and the products themselves is questionable. One company has even combined Amanita and delta-9 THC in a dietary supplement labeled as “Legal Trippy Mushroom Gummies.” If the trend continues, this ingredient could soon land on the FDA’s radar, and possibly the DEA’s. Such products also tend to be the focus of industry critics who point to DSHEA as the reason potentially unsafe products can easily flourish with little enforcement. There also is a sizable portion of the industry that believes psychedelic and other “recreational” products don’t fit within the supplement paradigm, and actually pose a threat.

Impact on DSHEA

Perhaps the most important consideration is whether there should be a place for psychedelics in the supplement industry. DSHEA likely didn’t envision many of the products we see on the market today. And while innovation is a critical element to the survival of any industry, psychedelics don’t fall squarely into the types of products the law was intended to protect. True, some are promoted for mental relaxation and other cognitive benefits, which are integral components of good health. We live in stressful times, and everyone could use the occasional mental health boost. But some of these products go much further than that, promising a full-on escape from reality. With certain psychedelics—in particular those that are federally scheduled—this type of head trip can be life-changing and provide powerful relief, but sometimes with serious side effects. Taking them only under the care of a licensed healthcare professional is clearly warranted. Although this may be an unpopular opinion, it seems the drug category may be the best and only pathway for these products, regardless of the legal barriers. 

Still, some companies will continue to forge ahead into the realm of psychedelics, including those with questionable legal status. As we’ve seen with CBD and other dietary ingredients that have faced regulatory challenges, the FDA may ultimately take a hands-off approach. However, the potential damage to the industry’s reputation is also at stake. Some have described the situation with CBD as a “litmus test” for DSHEA, with the ingredient’s meteoric rise, despite the FDA’s clear position on its status and safety, exposing just how ineffective this law really is in terms of keeping potentially unsafe or illegal products off the market. We’re all familiar with the FDA’s wish list of changes to DSHEA, and it’s debatable whether any of those would achieve the FDA’s goals or actually improve product safety. What’s clear is that products that skirt the line between drug and supplement, or supplement and controlled substance—whether truthful or not—have the potential to further damage the reputation of the industry.

The industry has weathered many storms, with others still on the way. Given the regulatory and legal challenges posed by psychedelics, this set of risks may not be worth it.

Editor's note: This article first appeared in Nutrition Business Journal’s Mood, Brain and Sleep issue. Sign up for NBJ’s bi-weekly Analyst’s Take newsletter for more industry insights.

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Supplement Science

About the Author(s)

Rend Al-Mondhiry

Partner, Amin Talati Wasserman LLP

Rend Al-Mondhiry is a partner with Amin Talati Wasserman LLP. She advises the dietary supplement, food, cosmetic and over-the-counter medicine industries on a broad range of regulatory and compliance matters, with a focus on helping companies navigate the rapidly evolving regulatory landscape for hemp and CBD products at both the federal and state level.

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