atai Life Sciences (NASDAQ:ATAI, ETR:9VC) remains a ‘Buy’ for analysts at Jefferies, who continue to see significant upside ahead for the company following the release of new data from Compass Pathways (NASDAQ:CMPS)’ late-stage trial of its synthetic psilocybin COMP360 in treatment-resistant depression (TRD).
Compass Pathways on Monday reported that its COMP360 therapy reached its primary endpoint, demonstrating a statistically significant and clinically meaningful reduction in depression symptom severity compared to placebo.
While atai has a small 7% stake in Compass Pathways, the results are positive for psychedelics more broadly, Jefferies believes.
“Seeing more positive Phase 2/3 readouts in general could strengthen the notion psychedelics can produce profound efficacy for tough $1 billion plus central nervous system disorders, helping grow investor mindshare,” analysts wrote.
Looking ahead, Jefferies is focused on BPL-003, an intranasal formulation of 5-MeO-DMT currently being evaluated in a 196-patient Phase 2b study in TRD. The study is comparing single doses of 12mg and 8mg to the sub-active 0.3mg.
Should the Phase2b study achieve certain milestones, atai will acquire 100% ownership of BPL-003 through a merger with the private biotech firm developing the asset, Beckley Psytech, in which it is already invested.
Jefferies believes this readout could significantly move atai’s stock. “We can see a large positive 50% to 100% stock move following atai/Beckley's merger in the second half of 2025, as the Street now has greater exposure to BPL-003,” the analysts wrote.
Stronger efficacy
The analysts believe BPL-003 could show stronger efficacy in terms of a reduction in the Montgomery-Åsberg Depression Rating Scale (MADRS).
Compass reported that a single 25mg dose of COMP360 resulted in a 3.6 point mean reduction on the MADRS scale at week 6.
Jefferies wrote that it would like to see a 5-point MADRS separation at week four for a meaningful stock move. “Recent stats analysis suggests the study could be powered to show -6.9 points,” they noted.
They also highlighted atai’s strategy of developing BPL-003 to fit within the therapeutic model established by Johnson & Johnson for its esketamine nasal spray Spravato.
“atai’s psychedelics are designed to fit into the two-hour, in-clinic treatment paradigm established by Spravato in TRD, which has a $1.3 billion-plus run rate and is guided to $3 billion plus by 2027,” they wrote.
The analysts have a $6 price target on atai, which represented upside of 142% at the time of writing.