Psyence Biomedical Invests in PsyLabs for Ibogaine Program

Psyence Biomedical Ltd. (Nasdaq: PBM) has announced a significant investment and strategic partnership with PsyLabs, a neuroplastogen active pharmaceutical ingredient development company. The transactions include an investment of up to US$5 million in PsyLabs, with an initial commitment of US$2.4 million, and a value-matched share exchange with a transaction value of approximately US$9 million on each side.

Psyence Biomedical, through its wholly-owned subsidiary, Psyence Biomed II Corp., has committed to invest up to US$5 million in PsyLabs. The investment is aimed at supporting scientific development and pharmaceutical-grade manufacturing capabilities relevant to Psyence Biomedical’s planned U.S. ibogaine program. Psyence Biomed II Corp. will subscribe for 936 PsyLabs ordinary shares at US$2,564 per share, based on a pre-money equity valuation of PsyLabs of US$54 million. The balance of up to US$2.6 million is a backstop commitment to subscribe for shares in that financing round not taken up by other PsyLabs shareholders, in up to two tranches of up to US$1.3 million each, payable upon certain milestones being achieved and other customary conditions. If the milestone tranches have not been called and completed by December 31, 2026, Psyence Biomed II Corp.’s obligation to fund them will lapse.

In addition to the cash investment, Psyence Biomedical and PsyLabs have agreed to a reciprocal share-for-share exchange, with each component valued at approximately US$9 million. Under the share exchange agreement, Psyence Biomedical will issue 1,497,500 common shares to PsyLabs, representing approximately US$8.99 million in transaction value based on a deemed issue price of US$6.00 per PBM share. In return, PsyLabs will issue 3,473 ordinary shares to Psyence Biomedical, representing an equivalent transaction value of approximately US$8.99 million based on an implied equity valuation of PsyLabs of US$60 million derived from an independent third-party valuation.

Immediately prior to the transactions, PsyLabs held approximately 30.22% of Psyence Biomedical’s issued and outstanding common shares, and Psyence Biomedical held approximately 29.17% of PsyLabs’ issued and outstanding shares. Following the share exchange and the committed portion of the cash investment, PsyLabs will hold approximately 49.89% of Psyence Biomedical’s issued and outstanding common shares, and Psyence Biomedical will hold approximately 41.13% of PsyLabs’ issued and outstanding shares. The cash investment and the share exchange are related-party transactions.

TIRC, a U.S. subsidiary of Psyence Biomedical, has been established to provide a dedicated corporate structure for the planned U.S. regulatory, clinical, and development activities involving pharmaceutical-grade ibogaine. The Company is currently evaluating the feasibility and design of a potential ibogaine clinical trial in Texas. Any clinical program would be subject to protocol development, regulatory review and authorization, institutional approvals, funding, site selection, and other customary requirements.

Psyence Biomedical is a Nasdaq-listed company with its subsidiary, Texas Ibogaine Research Corporation, headquartered in Texas. The company is one of the few multi-asset, vertically integrated biopharmaceutical companies specializing in neuroplastogen-based therapeutics and the manufacture of pharmaceutical-grade drug candidates. The Company is dedicated to addressing unmet mental health needs and is committed to an evidence-based approach to developing safe, effective, and FDA-approved nature-derived neuroplastogen treatments across a range of mental health disorders.

The transactions are part of Psyence Biomedical’s broader strategy to advance its ibogaine program in the United States, leveraging the combined expertise and resources of both companies. The deal is expected to streamline the development process and ensure the availability of high-quality ibogaine for potential clinical trials.