Drug Development Company ATAI, Backed by Peter Thiel, Acquires a Major Stake in Psyber Startup

By Mariliana Fotopoulou Friday, April 9, 2021

Biotech company ATAI Life Sciences has bought a majority stake in the US brain-computer interface startup company Psyber for an undisclosed amount.

3D rendering of a brain.

Developing Brain-Computer Interface

ATAI, backed by renowned investor Peter Thiel, is a global biotech business that develops psychedelics and other types of drugs for treating anxiety, depression, and other mental health conditions. In contrast, Psyber describes itself as a startup company that utilizes brain-computer interfaces to develop solutions for treatments.

A brain-computer interface enables direct communication between a human brain and an external device. Even though brain-computer interface technology developed by the startup company is still in the early phase of development, ATAI believes it could help patients better understand what kind of impact drugs make on their brain while improving their efficacy.

The biotech business said it plans to combine the development of its psychedelic compounds with the technology that allows recording electrical activity in the human brain used for understanding emotional, behavioral, and mental states.

“Combining both medicine and BCI-assisted therapy puts the patient firmly in the driving seat as it tailors to the individual’s specific needs,” said David Keene, chief of digital therapeutics at ATAI.

Prahlad Krishnan, CEO of the startup company, said the brain-computer interface could change the world we know today.

“In the context of mental health, this is no exception as every patient enrolled in BCI-assisted therapy will have greater autonomy, ever more empowered to change their feelings and behaviors to improve their quality of life,” said Krishnan.

The biotech business currently has around 50 employees across Berlin, New York, and San Diego and has partnerships with 14 companies that develop drugs and other technologies. The company already holds stakes in companies operating in those sectors.

The business helps scientists raise capital, collaborate with the regulators, and carry out clinical trials. Until now, no drugs developed by the biotech company have obtained official regulatory approval.

Peter Thiel led a $125 million financing round for ATAI last November and a $157 million round in March before that. The biotech business is reportedly planning to go public through an initial public offering (IPO) in the next couple of weeks.

“ATAI’s great virtue is to take mental illness as seriously as we should have been taking all illness all along. The company’s most valuable asset is its sense of urgency,” Peter Thiel told CNBC in January this year.

Peter Thiel and ATAI have also made several business investments together in the past and it remains unknown whether Thiel plays any other significant role at the company beyond being its investor.

A few weeks ago, ATAI announced it made a business investment and formed a strategic partnership with IntelGenx Technologies to purchase 37.3 million shares for $12.3 million. IntelGenx Technologies is a leading drug delivery company focused on the development and manufacturing of pharmaceutical films.

This way, the biotech business now owns 25% of IntelGenx's issued and outstanding shares, or 35% on full exercise of the warrants.

Summary

Biotech company ATAI Life Sciences, backed by Peter Thiel, has bought a majority stake in the US-based startup company Psyber, which develops a platform that utilizes brain-computer interfaces.

About the Author


Headshot for author Mariliana Fotopoulou

Mariliana has an MSC in consumer analytics and business strategy. She has a special interest in fast-moving industries and big data.

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