Compass Pathways (NASDAQ: CMPS) plans to file a New Drug Application in the fourth quarter of 2026 for COMP360, its synthetic psilocybin treatment for patients with treatment-resistant depression, following positive data from two pivotal Phase 3 trials.
"We believe already that we have a really strong profile emerging for psilocybin and for COMP360," Teri Loxam, Chief Financial Officer at Compass Pathways, said at a company event. The company is already pursuing a rolling submission with the U.S. Food and Drug Administration.
The decision to move forward follows readouts from two Phase 3 studies, COMP005 and COMP006, which both showed highly statistically significant improvements in depression symptoms at six weeks. Compared to the only approved drug for the condition, Johnson & Johnson's (NYSE: JNJ) Spravato, which requires frequent dosing, COMP360 has shown efficacy in under 24 hours with durability for up to six months after one or two treatments.
Shares of Compass Pathways have rallied in recent weeks on the news, with the stock holding a Relative Strength Rating of 96, placing it in the top 4 percent of all stocks for 12-month performance. The company has a Breakthrough Therapy designation from the FDA, and a priority review voucher could shorten the agency's review timeline from six months to as little as one to two months.
Compass Pathways is targeting a significant unmet need. Treatment-resistant depression affects approximately 4 million adults in the U.S. who have not found relief from at least two other antidepressant therapies. The current market leader, Spravato, is projected by Johnson & Johnson to reach $3.5 billion in revenue in 2028.
"To be able to have comparable efficacy from a treatment that’s only one or two treatments over six months is really truly gonna revolutionize the psychiatry industry," said Lori Englebert, the company's Chief Commercial Officer. She noted that the growth of Spravato has helped build out an infrastructure of over 4,000 sites capable of administering in-office psychiatric treatments, which COMP360 would also require.
Following a potential FDA approval, Compass must complete a federal DEA rescheduling for psilocybin before the drug can be distributed. The company expects this process to take approximately 90 days, though recent executive actions could shorten that timeline.
Beyond depression, Compass sees a major opportunity in post-traumatic stress disorder (PTSD), a condition affecting 13 million U.S. adults with no new approved drugs in over 25 years. A Phase 2a study of COMP360 in PTSD showed that over 80 percent of participants were in remission after a single treatment.
The company is preparing for the next data release, with six-month results from the second Phase 3 depression trial (COMP006) expected in the early third quarter. This data will be crucial for informing dosing regimens and supporting discussions with payers. In the wake of the company's first-quarter report, at least six analysts hiked their price targets on the stock.
The planned fourth-quarter filing de-risks the company's lead asset and marks a major step toward commercialization for the psychedelic medicine sector. Investors will now watch for the six-month COMP006 data in Q3 as the next major event.
This article is for informational purposes only and does not constitute investment advice.
