Psychedelics Regulatory and Business Law

Pharmaceutical companies, research institutions, clinical providers, and investors are working to develop and commercialize psychedelic medicines and services—but federal controlled substance prohibitions, human subject protection requirements, FDA oversight, and complex state regulations create a web of overlapping legal and business risks.

Psychedelic drugs, such as psilocybin, MDMA, ketamine, DMT, LSD, and ibogaine, remain classified as Schedule I controlled substances under federal law, making every step from research study design to clinical trials to market approval subject to complex, and sometimes conflicting, regulatory regimes. Companies, investors, and practitioners navigating the federal landscape need advisors who understand not only FDA drug approval and clinical trial requirements but also patient consent, practitioners’ scope of practice, business structure, and reimbursement. By the same token, companies, investors, and facilitators navigating the state-regulated landscape need advisors who understand business structure, regulated psychedelic program regulations, advertising, and local restrictions.

Epstein Becker Green’s multidisciplinary team brings extensive experience across all three dimensions—federal pharmaceutical law, state-regulated programs, and ancillary health care services—to guide clients through every stage of a psychedelics business life cycle.

Who We Serve

Our clients range from early-stage startups to established businesses, including pharmaceutical and biotech manufacturers pursuing FDA approval for psychedelic drug candidates, from investigational new drug (IND) application through new drug application (NDA) submission and post-approval marketing and promotion. Research institutions and academic medical centers rely on us for clinical trial design, FDA compliance, informed consent protocols, and human subject protections specific to psychedelic research.

We provide corporate and regulatory legal support to state-regulated psychedelic service providers operating under programs like Oregon’s Psilocybin Services Program and Colorado’s Natural Medicine Program. Individual practitioners such as therapists, psychiatrists, nurse practitioners, and other licensed professionals turn to us for legal advice when integrating harm reduction and psychedelic-assisted services into their practices.

Our Psychedelics Legal Services

FDA Regulatory Strategy and Approval

Epstein Becker Green guides sponsors through the FDA approval pathway for psychedelic drug candidates, including IND application strategy, clinical trial design and enrollment, pharmacology and toxicology workplans, and NDA preparation and submission.

We have particular experience in addressing FDA’s heightened requirements for psychedelic trials—including enhanced informed consent, adequate blinding protocols when appropriate, and robust human subject protections—based on FDA’s July 2026 final guidance on designing clinical trials involving psychedelics.

We also counsel on risk evaluation and mitigation strategies, post-approval marketing and distribution, and generic pathways.

Clinical Research Compliance and Trial Operations

We advise research sponsors, principal investigators, and clinical research organizations on federal requirements for psychedelic clinical trials, including IND-enabling studies, adverse event reporting to the FDA, protocol modifications, and interactions with institutional review boards (IRBs). We counsel on extended access and right-to-try pathways for patients who do not qualify for clinical trials.

Our capabilities also include advising research sponsors and sites on structuring arrangements that comply with multiple federal and state laws that govern research-related payments.

We also address the intersection of clinical research and state-regulated programs, helping researchers understand whether and how to operate within state frameworks while maintaining federal compliance.

State-Regulated Psychedelic Programs and Licensing

Epstein Becker Green has extensive experience representing service centers, manufacturers, and facilitators navigating state-regulated psychedelic programs, including Oregon’s Psilocybin Services Program and Colorado’s Natural Medicine Program. We advise on risk assessment, strategic liability mitigation, and scope-of-practice boundaries for practitioners providing psychedelic services, as well as regulatory compliance for state-licensed individuals and businesses. We also provide corporate representation during the full life cycle of our clients’ businesses and help navigate the particular issues that arise in the state-regulated context.

Ancillary Business Operations and Compliance

Beyond direct pharmaceutical development and state-regulated programs, we counsel on the complex considerations that ancillary businesses supporting the psychedelics ecosystem must navigate, including harm reduction services, training programs that credential practitioners in psychedelic-assisted therapy, international retreats, medical risk assessment platforms, and insurance products for psychedelic services.

Corporate Practice and Health Care Services Integration

We represent behavioral health and mental health organizations integrating psychedelic services into existing practices. This includes navigating corporate practice of medicine restrictions in various states, managing liability related to professional license and scope-of-practice limitations, addressing insurance coverage and reimbursement, and complying with applicable regulations.

Coverage, Coding, and Payment

Innovators need to be keenly aware of the environment and processes for obtaining coverage and reimbursement for services that will use the products that they are developing to attract investment and commercialize their products. Epstein Becker Green has years of experience working with health care innovators and researchers to navigate these complex regulatory issues and to help build a strong case for market entry.

Why Clients Choose Epstein Becker Green

Navigating Federal and State Law

Some psychedelics legal practices focus on either federal pharmaceutical law or state-regulated services, but Epstein Becker Green integrates these worlds. Federal pharmaceutical laws and state-regulated psychedelic services each represent distinct pathways to access, and each carries its own regulatory architecture, compliance obligations, and business considerations. Epstein Becker Green’s experience spans the full spectrum, from IND applications and clinical trial design to small businesses that operate training programs and state-regulated psychedelics companies.

Clients who choose Epstein Becker Green benefit from advisors who can navigate the full breadth of the psychedelics ecosystem and identify how federal enforcement policy may affect state-licensed operators, how clinical trial protocols may inform state-regulated facilitation services, and how existing state-regulated frameworks may shape future federal action. We bring the cross-cutting perspective that comes from advising clients across the entire psychedelics field.

Track Record in Clinical Research and Drug Development

Epstein Becker Green has substantial experience with clinical research requirements, IND compliance, and FDA interactions across the life sciences sector. Psychedelics present distinctive challenges—chiefly, FDA’s heightened consent and blinding requirements—but these challenges sit atop a foundation of clinical research law that the firm has practiced for decades. Our clinical research team has tracked FDA guidance on psychedelics since early development and advised clients on protocol design, IRB interactions, and compliance with human subject protections.

State Regulatory Tracking and Real-Time Intelligence

Epstein Becker Green monitors state legislation, regulatory guidance, and enforcement actions through dedicated tracking resources and industry partnerships, allowing us to advise clients proactively on new opportunities and emerging compliance obligations. This real-time intelligence informs both strategic business planning and day-to-day operational compliance.

Representative Matters

Epstein Becker Green attorneys have advised clients across the psychedelics regulatory landscape, including the following representative matters:

FDA and DEA Regulatory Matters

• Advised a psychedelics drug development company on Drug Enforcement Administration (DEA) regulatory matters in connection with an active drug development program.
• Advised a clinical research organization on FDA regulatory strategy and a psilocybin research agreement supporting a research program, including a related research collaboration with a Canadian psychedelic science research center.

State-Regulated Programs and Licensing

• Advised a psychedelic medicine clinic operator on entity formation and management services organization structuring for a network of state-regulated psychedelic treatment centers.
• Advised state-regulated psychedelics businesses in connection with service center, healing center, cultivation, manufacturing, and facilitator licensing, business organization and structuring, financing, tax strategies under Section 280E of the Internal Revenue Code, employment and contractor relationships, commercial contracts, and insurance.
• Advised state-regulated businesses regarding compliance with state-specific laws and regulations related to personal use, client service contracts, waivers and liability releases, advertising restrictions, and licensing requirements.

Corporate Practice and Health Care Integration

• Advised behavioral health practices on regulatory structuring for ketamine treatment services, including corporate practice of medicine and licensure considerations.
• Advised mental health care practitioners on structuring harm reduction services within the limits of their professional licenses, including scope of practice, client communications about psychedelic use, documentation, and professional liability.
• Advised ketamine clinics on informed consent forms, client service agreements, and session structure to address licensure and liability risk.

Ancillary Business Matters

• Advised an investor on legal and regulatory due diligence in connection with the proposed acquisition of a group of ketamine clinics.
• Advised an international psychedelic retreat company in connection with corporate organization and structure, client service agreements, and waivers and liability releases.
• Advised a psychedelic therapy training program on corporate and tax structure, educational program contracts, waivers and liability releases, and employment and contractor relationships.

Frequently Asked Questions

How should a business approach the intersection of federal and state rules governing psychedelic products?

Businesses in this space often find it helpful to define the scope of their operations early and to consider each planned activity under both federal and state law, since the legal and regulatory risk profile can vary significantly from one activity to another.

For example, businesses pursuing FDA-regulated pathways (clinical research, marketing submissions, and DEA-regulated activities) operate under a very different framework from those operating inside a state-regulated program, and the two are not interchangeable.

Other topics commonly arising in this industry include state and federal tax considerations, intellectual property strategy, and a range of additional business and compliance matters.

Because this area of law is evolving rapidly, many businesses build regulatory monitoring and flexibility into their corporate structures and contracts from the outset. Epstein Becker Green attorneys guide these companies through this type of planning and strategy process.

What should investors interested in companies operating in the psychedelics industry consider in terms of regulatory risk?

Legal and regulatory risk in psychedelics is multifaceted, and companies operating in the industry must present a level of sophistication around approaching those risks appropriately.

Smart investors evaluate the company’s risks through that lens, assessing compliance with the applicable federal and state regimes and the controls and preventative mechanisms the company already has in place, depending on its size and scale.

We advise investors on legal and regulatory due diligence, risk factors to evaluate, and deal structure to allocate regulatory risk appropriately.

Get Started

If you are developing a psychedelic drug candidate, operating a state-regulated psychedelic program, designing a clinical trial, or integrating psychedelic services into your practice, our team can help you navigate the legal and regulatory challenges specific to your situation.

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