Introduction to Psychedelics and Reimbursement

Background on Psychedelic Therapies

Historical Use and Early Research

Psychedelic substances have been used for millennia in various indigenous cultures for religious, spiritual, and healing purposes. For instance, psilocybin-containing mushrooms have been integral to Mesoamerican rituals, while ayahuasca, a brew containing DMT and harmine, has been used in the Amazon basin for shamanic ceremonies. These practices recognised the profound psychological and spiritual effects of psychedelics long before they entered Western scientific awareness (Nichols, 2016; Garcia-Romeu et al., 2016).

In the mid-20th century, Western medicine began to explore the therapeutic potential of psychedelics. In 1938, Swiss chemist Albert Hofmann synthesised Lysergic Acid Diethylamide (LSD) at Sandoz Laboratories, and in 1943, he discovered its psychoactive properties (Hofmann, 1979). Throughout the 1950s and 1960s, psychiatrists and psychologists conducted extensive research and clinical practice using LSD, psilocybin, and other psychedelics for treating conditions such as alcoholism, anxiety, and depression. Notably, studies suggested that these substances could facilitate breakthroughs in psychotherapy by allowing patients to access repressed emotions and traumas.

However, the increasing recreational use of psychedelics and their association with counterculture movements led to societal backlash. In 1971, the United Nations Convention on Psychotropic Substances classified many psychedelics as Schedule I substances, denoting a high potential for abuse and no accepted medical use (UN, 1971).

Multiple factors contributed to the halt in psychedelic research: the emergence of randomised controlled trials (RCTs) as the new gold standard, which posed methodological challenges for psychedelic studies; stricter pharmaceutical regulations following the Thalidomide disaster; and Sandoz's decision to stop producing LSD for research in 1965. Together, these developments made it exceedingly difficult to obtain approvals and funding for studies involving psychedelics (Hall, 2021).

Modern Resurgence

The early 21st century witnessed a renewed scientific interest in psychedelics, spurred by advancements in neuroscience and a growing recognition of the limitations of existing mental health treatments.[5]1 Researchers began to revisit earlier studies and explore the mechanisms by which psychedelics could produce therapeutic effects.

Key institutions like Johns Hopkins University in the U.S. and Imperial College London in the UK initiated rigorous clinical trials investigating the use of psychedelics for various mental health conditions. The 2006 study by Roland Griffiths and colleagues at Johns Hopkins was particularly significant as one of the first modern psychedelic studies at a major U.S. research institution. It not only demonstrated that psilocybin could safely induce mystical experiences with sustained personal and spiritual significance in healthy volunteers but also showed lasting positive changes in their psychological well-being, life satisfaction, and behaviour. This research helped establish the scientific credibility necessary for subsequent clinical studies in patient populations (Griffiths et al., 2016).

Regulatory bodies have started to acknowledge the potential of psychedelics as therapeutics. In 2017, the U.S. Food and Drug Administration (FDA) granted Breakthrough Therapy designation to MDMA therapy for post-traumatic stress disorder (PTSD), developed by the Multidisciplinary Association for Psychedelic Studies (MAPS) (FDA, 2017). This designation is intended to expedite the development and review of drugs that show substantial improvement over existing therapies.

Similarly, in 2018, the FDA granted Compass Pathways Breakthrough Therapy designation for its psilocybin therapy for treating treatment-resistant depression (TRD) (Compass Pathways, 2018). Subsequent Breakthrough Therapy designations have been awarded to Usona Institute for psilocybin therapy for major depressive disorder (MDD) (Usona Institute, 2019), Cybin for psilocybin analogue (CYB003) for MDD (Cybin, 2024), and Mind Medicine for its LSD-analogue (MM120) for generalized anxiety disorder (GAD) (MindMed, 2024a).

In 2022, the UK’s Medicines and Healthcare products Regulatory Agency (MHRA) awarded Compass Pathways an Innovation Passport under the Innovative Licensing and Access Pathway (ILAP), which is intended to facilitate greater engagement with authorities and potentially faster patient access to promising medicines (Compass Pathways, 2022). MAPS and Lykos Therapeutics (formerly MAPS PBC), the commercial arm of MAPS, also received the Innovation Passport from the MHRA for their MDMA therapy for PTSD (MAPS, 2022). More recently, the LSD programme for generalised anxiety disorder (GAD) from MindMed also received an Innovation Passport designation (MindMed, 2024b).

The EMA has also demonstrated a proactive approach to psychedelic medicines, organising a two-day workshop to discuss regulatory frameworks and clinical development (EMA, 2024). Through its PRIME (PRIority MEdicines) scheme, the EMA has signaled its openness to supporting the development of psychedelic medicines that address unmet medical needs. However, no psychedelic therapy developers have yet applied for PRIME designation.

Pharmacological Effects Combined with Psychotherapy

The therapeutic use of psychedelics often combines pharmacological intervention with psychotherapeutic support. However, perspectives on the necessity and optimal level of psychological support vary among stakeholders and may depend on the specific condition and patient population being treated. Many researchers and clinicians believe that psychedelics' ability to induce altered states of consciousness, when guided by trained clinicians, can lead to profound psychological insights and emotional healing. This synergistic effect is believed to enhance the therapeutic process beyond what might be achievable with medication or psychotherapy alone (Krediet et al., 2020).

For example, in MDMA therapy for PTSD, the drug's empathogenic effects can reduce fear and defensiveness, allowing patients to process traumatic memories more effectively during therapy sessions (Mitchell et al., 2021). Similarly, psilocybin therapy can facilitate a sense of interconnectedness and self-transcendence, which may help alleviate depressive symptoms (Davis et al., 2021).

While significant therapeutic benefits have been observed in clinical trials using supported models, ongoing research and debate continue regarding the optimal level of psychological support needed across different indications and treatment contexts.

Treatment Protocols

Psychedelic therapy protocols typically involve three key phases (Brennan & Belser, 2022):

1. Preparation: Before administering the psychedelic, patients participate in one or more preparatory sessions with trained healthcare providers. This phase aims to build trust, set intentions, and educate the patient about the upcoming experience. Preparation helps to minimise anxiety and establish a supportive therapeutic alliance.

1. Dosing Session (the "Trip"): The patient receives the psychedelic substance in a controlled, safe environment under professional supervision. Sessions typically last anywhere from one to twelve hours, during which facilitators provide support but generally allow the patient's experience to unfold without direct intervention.[6] The setting is designed to be comfortable and calming, often with music and minimal distractions.

1. Integration: Following the dosing session, patients engage in integration sessions to process and make sense of their experiences. Mental health professionals help patients translate insights gained during the psychedelic experience into practical changes in thoughts, behaviours, and emotions. Integration is thought to be critical for achieving lasting therapeutic benefits.

Importance of Set and Setting

"Set and setting" are fundamental concepts in psychedelic therapy (Hartogsohn, 2017):

• Set (Mindset): Refers to the individual's internal state, including their mood, expectations, and intentions. A positive mindset can enhance the therapeutic experience, while negative emotions or apprehensions may lead to challenging experiences.

• Setting (Environment): Encompasses the physical and social surroundings during the psychedelic session. A safe, supportive, and controlled environment facilitates positive outcomes and minimises risks.

Healthcare practitioners play a crucial role in managing both set and setting, ensuring that patients are psychologically prepared and that the environment is conducive to healing.[7]2

Rapid and Sustained Symptom Reduction

One of the most compelling aspects of psychedelic therapies is their potential for rapid symptom improvement after just one or a few treatment sessions, in contrast to conventional antidepressants, which typically require 4-6 weeks of daily administration to achieve therapeutic effects. While response rates vary among individuals, clinical trials have demonstrated that some patients may experience significant reductions in depression, anxiety, or PTSD symptoms within days of treatment, with effects lasting weeks, months, or even years (Bahji et al., 2023).

For instance, Compass Pathways' Phase IIb trial, with 233 patients with treatment-resistant depression (TRD), found that a single 25 mg dose of psilocybin, administered with psychological support, significantly reduced depressive symptoms within two days compared to lower doses (10 mg and 1 mg) in a subset of participants. Among those who responded to treatment, some patients' benefits persisted for up to 12 weeks (Goodwin et al., 2022). This rapid onset of action contrasts with traditional antidepressants, which often require continuous daily dosing and may take several weeks before patients experience meaningful improvement.

Emerging Evidence Across Mental Health Conditions

Psychedelic therapies have shown promise in treating conditions that are resistant to standard medical interventions, with an estimated 30-50% of patients not responding to traditional approaches (Howes et al., 2022; McIntyre et al., 2023). Patients who have not responded to established antidepressant pharmacotherapies or psychotherapy may benefit from the novel mechanisms of action offered by psychedelics.

In Lykos' Phase III trial for MDMA psychotherapy, 67% of participants with severe PTSD no longer met the diagnostic criteria for PTSD after three treatment sessions, compared to 32% in the placebo group (Mitchell et al., 2021). The second Phase III trial, which included patients with moderate PTSD, found that 71% of patients no longer met the PTSD diagnostic criteria (Mitchell et al., 2023). This is particularly significant given that participants had struggled with PTSD symptoms for an average of 16 years and had not found relief with existing therapies.

Beyond TRD and PTSD, clinical research is expanding rapidly across multiple conditions. Current trials are investigating psychedelic therapies for substance use disorders, including alcohol and tobacco dependence, and are showing promising early results. Studies are also exploring applications in anxiety related to terminal illness, eating disorders such as anorexia nervosa, and obsessive-compulsive disorder. This breadth of research indicates that psychedelic therapies represent not just isolated treatments but a broader therapeutic paradigm with potential applications across mental health conditions (Blossom, n.d.).[8]3

Healthcare stakeholders must recognise that these developments represent a comprehensive wave of clinical innovation approaching health systems. These novel therapies share unique characteristics distinguishing them from conventional treatments, most notably in their requirement for supported psychoactive experiences. This core feature, combined with the integration of pharmacological intervention and psychotherapeutic support in controlled settings, sets them apart from traditional mental health treatments. This emerging therapeutic class will require adaptations in clinical practice and dedicated healthcare infrastructure for successful implementation.

This report addresses these critical challenges by examining existing healthcare frameworks, engaging key stakeholders, and developing actionable recommendations so these promising treatments reach those who most need them. Our analysis focuses on four key areas: addressing access barriers, supporting stakeholders across the healthcare ecosystem, mapping viable reimbursement pathways, and identifying implementation challenges that must be overcome to realise the full potential of psychedelic therapies.

Current Reimbursement Landscape for Psychedelic Therapies in Europe

Getting new medical treatments to patients in the EU can be complicated, especially for innovative therapies like psychedelics. Following market authorisation by the EMA, each EU country independently assesses which treatments to offer and how to pay for them. The UK and Switzerland maintain separate marketing authorisation pathways. This section looks at how different European healthcare systems are handling psychedelic therapies, including who can access them and who pays for them.

At the moment, only a few psychedelic treatments are officially available in Europe. The only medication available for prescription is Spravato (esketamine) nasal spray for TRD, though access and funding vary by country. Ketamine therapy, available through off-label or compassionate use, is offered on a case-by-case basis or through private clinics. Other psychedelic therapies are not legally available outside of clinical trials.

Overview of European Healthcare Systems

European healthcare systems aim to provide universal health coverage but differ in how they organise and pay for healthcare. These differences affect how new treatments, including psychedelic therapies, become available to patients.

Healthcare Models

Most European countries use one of three main approaches to healthcare delivery. Public systems, like those in the UK, Denmark, and Sweden, rely primarily on public healthcare funded through taxes. The UK's National Health Service (NHS) is a prime example, providing free care at the point of need.

Insurance-based systems in Germany and the Netherlands use mandatory health insurance. In Germany, individuals are generally required to join a statutory health insurance fund up to a certain income threshold, above which individuals can opt for private health insurance. Costs are shared between employers and employees. In contrast, the Dutch system requires all residents to take out private health insurance with a government-regulated standard package, regardless of income, with costs shared between employers and employees.

Mixed systems operate in countries like France, Italy, and Spain. These systems combine public funding with private healthcare delivery. About half of the hospitals in these countries are private but receive public funding.

Decision Making

Countries also differ in how centralised their healthcare decisions are (Montagu, 2021). England and Wales, and the Netherlands have highly centralised systems, with national bodies making decisions about new treatments that apply across the country.

In contrast, countries like Spain and Italy give regions more power to make healthcare choices, including which treatments to fund. Germany represents a mixed approach. Statutory and private health insurances are generally required to cover treatments included in the national catalogue. Still, they can grant optional additional benefits and contract-based care models.

Timing for Access

The time it takes for patients to access new treatments varies widely across Europe (EFPIA, 2022; EFPIA, 2024a). Germany leads with the fastest access, with new treatments available on average 126 days after regulatory approval (products can access the German market immediately if the manufacturer is prepared). Denmark and Austria follow with averages of 149 and 283 days, respectively. Mid-range timelines are seen in countries like the Netherlands (371 days) and the Czech Republic (494 days). However, many countries take significantly longer—Bulgaria averages 723 days, Romania 778 days, and Poland 804 days. These differences mean that patients in some countries wait substantially longer for new treatments than others. Beyond the waiting time, however, the overall availability of treatments is also a critical issue— in certain countries, only a small proportion of EMA-approved treatments are accessible to patients. Therefore, both the time to access and the overall availability of treatments are crucial factors to consider.

Private Healthcare Options

While European countries have strong public healthcare systems, the role of private healthcare varies significantly across the region (Eurostat, 2024). Private insurance can provide extra coverage on top of public care or offer alternative services, with the balance varying significantly between countries. Private clinics often provide faster access to treatments not yet available through public systems, particularly for newer therapies.

However, this creates significant equity concerns, as demonstrated by the current ketamine clinic model, where treatments are primarily available through private clinics requiring substantial out-of-pocket payments. This approach risks excluding lower-income populations who often face higher rates of mental health challenges and substance use disorders, potentially deepening existing health inequities.

Impact on Psychedelic Therapies

The variety of healthcare systems across Europe creates several challenges for psychedelic therapies. These treatments combine drug treatment with a psychotherapeutic component, which many healthcare systems are not currently set up to evaluate and implement easily. Countries may take very different approaches to reimbursement (i.e., paying for) these combined treatments, leading to varied access across Europe.

While private clinics might offer these treatments before public systems do, relying primarily on private provision may create disparities in access, particularly affecting communities with higher rates of mental health challenges and substance use disorders. Ensuring equitable access through public healthcare systems represents a significant implementation challenge for these novel therapeutic approaches.

Status of Psychedelic Therapies Across Key Markets

Only two psychedelic treatments are currently available in European markets: esketamine, which has regulatory approval for TRD, and ketamine, which is available in select hospital settings and private clinics. However, regulatory approval does not guarantee payer acceptance, as demonstrated by the varied reimbursement status and accessibility of these treatments across healthcare systems. Here, we summarise the current status across four key markets.

Germany

In Germany, Spravato received a positive assessment from G-BA for treatment-resistant depression (TRD) in 2023—when used in conjunction with an SSRI or SNRI—acknowledging its considerable added benefit compared to existing treatments (G-BA, 2023). G-BA gave Spravato its second-highest possible clinical benefit rating (considerable benefit) for treating depression that has not responded to other treatments. Public insurance now covers Spravato treatment when delivered in specialised settings, though access remains limited by the availability of these facilities.

Beyond Spravato, off-label ketamine is used in a limited number of clinics, typically requiring private payment or case-by-case insurance approval. From a regulatory perspective, Germany's framework permits access to esketamine and ketamine therapies; however, practical implementation faces challenges, including limited specialised treatment facilities and relatively few physicians willing to prescribe these treatments. The country's research initiatives, including the completed EPIsoDE trial studying psilocybin for TRD and a planned Phase III study, may help pave the way for future treatments (NLM, 2021-2024).

Netherlands

The Netherlands provides greater access to psychedelic treatments than many other European countries. The healthcare system features comprehensive coverage for psychotherapeutic interventions and flexibility in provider arrangements and reimbursement structures. Several clinics currently offer ketamine therapy, and insurance covers up to 90% of the clinical support costs—specifically, the therapeutic sessions and professional expertise (Magnolia Therapy, n.d.).

While Spravato was approved for coverage under basic health insurance in September 2021, access remains severely limited (ZiN, 2020). Despite an estimated 1,500-2,000 patients with TRD being eligible annually, only a few dozen patients received treatment in 2022 (Depressie Vereniging, 2022).

Some hospital systems offer off-label use programs for ketamine treatment on a case-by-case basis. A consortium of researchers has initiated efforts to start a trial to evaluate ketamine's efficacy and safety for broader insurance coverage.

The country has also seen early adoption of psilocybin treatments in specific clinical settings, though these remain outside standard reimbursement pathways. While regulated medical centres focus on approved treatments, some practitioners offer psilocybin sessions in the unregulated market. The Netherlands' unique legal framework allows for the sale and use of psilocybin-containing truffles, which remain unregulated and widely available through smartshops.

In a significant development, the Dutch State Commission on MDMA recently recommended allowing MDMA therapy for PTSD treatment, advocating for a regulatory framework to enable medical use (Government of the Netherlands, 2024).

United Kingdom

In the UK, Spravato faced challenges gaining NHS coverage. NICE repeatedly declined to recommend it in England and Wales due to cost-effectiveness concerns (NICE, 2024a), but the Scottish Medicines Consortium (SMC) did recommend it for use in Scotland.

Access to ketamine treatment in the UK remains limited but is available through several specific routes. These include a small number of NHS clinics, Oxford Health NHS Foundation Trust's Interventional Psychiatry Service (offering both NHS-funded and self-pay options), and private clinics. Work to develop replicable care models continues, led by clinical advocates of ketamine therapy. A small TRD pilot using racemic ketamine is running in 2025 within the Central and North West London Foundation Trust, aiming to integrate with existing NHS depression care pathways (Oxford Health NHS Foundation Trust, 2024; Imperial College London, 2025). While private clinics offer both Spravato and ketamine treatments, high costs restrict accessibility.

The UK government has demonstrated increasing openness to psychedelic research through multiple funding channels. The Innovative Licensing and Access Pathway (ILAP) has granted designations to five psychedelic therapy developers (Small Pharma, 2021; Eleusis, 2022; Compass Pathways, 2022; MAPS, 2022; Mindmed, 2024b). Public funding supports numerous clinical trials, including two-thirds of Awakn's Phase III trial for alcohol use disorder (NICE, 2024b). Imperial College London's psilocybin studies have received support from the National Institute for Health Research (NIHR) and the Government's Office for Life Sciences for opioid addiction research, while their work on psilocybin for gambling disorders is backed by a UKRI Impact Acceleration Account grant (Imperial Biomedical Research Centre, 2024; Mundell, 2024).

Despite this growing institutional recognition of psychedelics' therapeutic potential across multiple conditions, meeting NICE's cost-effectiveness thresholds remains a significant hurdle for NHS coverage of novel psychedelic treatments.

Czech Republic

The Czech Republic has implemented ketamine therapy in clinical practice earlier than many other European countries, with a limited number of established clinics offering treatment. Building on its regulatory experience with ketamine and medical cannabis, the country provides a case study in integrating psychedelic therapies into healthcare. Some insurance coverage exists for ketamine treatments, though often requiring significant patient co-payment.

Since 2020, clinics have offered ketamine therapy to hundreds of patients (Šenk, 2023; Šenk, 2024). These treatments have expanded from TRD to now also covering eating disorders, PTSD, addictions, and anxiety disorders. The facilities are also participating in clinical trials of various psychedelic substances, including ketamine, 5-MeO-DMT, and upcoming studies with psilocybin.

A significant development is the establishment of insurance coverage agreements with major providers, including VZP, the country's largest insurer. Spravato (esketamine) is now listed among the reimbursed medicinal products by the State Institute for Drug Control (SÚKL, 2024), indicating its inclusion in public health insurance coverage. This advancement enhances patient access to esketamine therapy for TRD.

With a strong tradition of evidence-based policymaking in drug regulation, the Czech Republic may be emerging as a strategic country for psychedelic-assisted treatments. This evolving regulatory landscape extends beyond psychedelics to other previously unregulated psychomodulatory substances, such as kratom and THC, signalling a broader shift in policy and access.

Other European Markets

Looking at other European markets, Switzerland stands out for its well-established compassionate use framework, which has allowed limited access to MDMA, psilocybin and LSD therapies through specialised clinics from 1988-1993 and since 2014 (Liechti, 2019). Several psychiatrists have received special authorisations from the Federal Office of Public Health to provide these treatments.

In most other European countries, access to esketamine (Spravato) remains restricted primarily through hospital-based programs, with varying levels of public insurance or health system coverage.

Early Access and Alternative Pathways

While standard reimbursement pathways through national health systems are the assumed route to broader access, several alternative routes currently provide access to psychedelic therapies in Europe.[9]4 These pathways offer important insights into implementation challenges and opportunities while generating valuable real-world evidence.

Compassionate Use Programs

Several European countries operate compassionate use programs that can provide access to treatments before full regulatory approval. These programs typically focus on patients who have not responded to available therapies and have limited options. Next to Switzerland, clinicians in the Netherlands have a “gentlemen's agreement” with insurers to offer off-label ketamine treatments to patients who have exhausted other options.

Research-Based Access

Clinical trials and research programs currently serve as a key access route for psychedelic therapies. Beyond generating evidence for future approval and reimbursement, these programs help establish treatment protocols and train healthcare providers. Major academic centres and research hospitals across Europe are conducting trials with various psychedelic compounds, creating pockets of expertise that could support broader implementation.

Private Clinic Models

Private clinics have emerged as early adopters of psychedelic treatments, particularly for ketamine therapy. These clinics typically operate on a self-pay basis, though some have established relationships with private insurers or secured partial reimbursement for therapy components. While high costs limit access, these clinics provide valuable insights into practical implementation challenges and successful treatment delivery models.

Off-label and Pharmacy Preparation

Some countries allow physicians to prescribe approved medicines for off-label uses or have frameworks for pharmacy-prepared versions of ketamine. These pathways can provide flexible access options, though usually without insurance coverage. The Netherlands and Germany have established frameworks for the pharmacy preparation of ketamine.