How to Regulate Psychedelics

Disclaimer: The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of Chemical Collective or any associated parties.

If you have spent any considerable time on the Chemical Collective Blog, and as I have previously discussed at length! You will be more than aware that right now the psychedelic renaissance is in full swing. It’s about time! Once, they were dismissed as frightening relics of a forgotten counterculture, or thought of as dangerous narcotics. These substances are now at the heart of a revolution in mental health, spirituality, and social justice. From university labs to centuries old Indigenous ceremonies, psychedelics are challenging decades of stigma. Substances like psilocybin, MDMA, and ayahuasca are offering new found hope. And often in situations where conventional treatments have failed. But as the world wakes up to their potential, a difficult question looms:

How do we regulate these powerful tools without repeating, or even exacerbating the harms of prohibition?

Enter: How to Regulate Psychedelics, a bold blueprint from the Transform Drug Policy Foundation. This report doesn’t just tinker at the edges of drug policy, it demands a radical rethink. Forget “Just Say No.” Instead, imagine a world where access is guided by equity, science, and respect for ancient traditions. Where healing isn’t a privilege for the wealthy, and where communities shattered by the drug war lead the charge.

In this article, we unpack the report’s urgent call to action. You’ll discover why the “war on drugs” failed psychedelics (and everyone else), how regulation can prevent Big Pharma from hijacking the renaissance, and what it means to centre Indigenous wisdom in modern policy.

Spoiler: It’s not about handing out mushrooms to all and sundry!

It’s about building systems that honour both the promise and complexity of these substances, without leaving anyone behind.

This piece focuses solely on the information contained in the report, which is why the vast majority of the specific data, laws etc. are US-based, but the findings, conclusions, and suggestions therein, I believe, apply worldwide.

What Are Psychedelics?

Psychedelics are a class of psychoactive substances that alter perception, cognition, and emotion. They can often facilitate profound introspective or spiritual experiences. As outlined in the Transform report, they include both classic psychedelics, such as psilocybin (found in “magic mushrooms”), LSD, mescaline (from peyote and San Pedro cacti), and DMT (a key component of ayahuasca), and empathogens like MDMA, which enhance emotional connection and self-reflection. These substances have been used for millennia in indigenous healing and spiritual practices. The Mazatec people’s ceremonial use of psilocybin mushrooms in Mexico and the Shipibo-Conibo’s ayahuasca rituals in the Amazon, for example. Modern research now validates their therapeutic potential: clinical trials highlight psilocybin’s efficacy in treating depression, MDMA’s groundbreaking results for PTSD, and ibogaine’s ability to disrupt addiction cycles.

However, the Transform report emphasises that psychedelics are not “miracle cures” but tools that require careful integration into holistic frameworks. Their effects depend heavily on set (mindset), setting (environment), and the guidance of trained facilitators. Risks, such as psychological distress during a “bad trip,” are rare in controlled contexts but underscore the need for regulated access. Crucially, the report dispels myths linking psychedelics to physical addiction or overdose deaths, noting that “no recorded fatalities have resulted from the classic psychedelics psilocybin or LSD when used in their pure forms.” This distinction challenges prohibitionist narratives and highlights the urgency of rethinking outdated drug policies.

Why Regulate Psychedelics and Why Now?

The push to regulate psychedelics is driven by a dizzying combination of scientific, social, and political factors. And this moment is uniquely urgent!

Prohibition has catastrophically failed,

declares the Transform report, noting that decades of criminalisation have not reduced use but instead perpetuated systemic harms. The issues of mass incarceration, racial disparities in drug policing, and the erasure of indigenous psychedelic traditions are now at the forefront. Meanwhile, a renaissance in clinical research has shattered old stigmas, revealing psychedelics’ potential to address mental health crises that conventional treatments have struggled to curb. For example, psilocybin and MDMA have received “breakthrough therapy” status from the FDA for depression and PTSD, respectively, a regulatory acknowledgment of their unparalleled efficacy.

The report warns that “inaction now risks ceding control to profit-driven interests,” as venture capital floods into the psychedelics sector. Without proactive regulation, access could become a luxury commodity, exacerbating inequities in healthcare. Decriminalisation efforts in cities like Denver and Oakland, along with Oregon’s voter-approved psilocybin therapy program, demonstrate a public mandate for reform. However, these piecemeal approaches lack the coherence of a national or international framework.

Critically, the report stresses that regulation is not just about managing risks but “repairing historical wrongs.” Indigenous communities, whose ancestral practices were criminalised under colonial drug laws, must lead conversations about cultural stewardship. Similarly, communities disproportionately targeted by the war on drugs, particularly Black and Brown populations, should be prioritised in licensing, education, and economic opportunities within the emerging psychedelics landscape.

This video is an interesting discussion of the racial disparity in drug regulation and policing in the US:

The timing is also shaped by growing public acceptance. A 2022 poll found 59% of U.S. adults support regulated therapeutic access to psychedelics, reflecting a cultural shift away from fear-based narratives. As the report concludes:

The question is no longer whether to regulate psychedelics, but how, and who gets to decide.

How to Think About Psychedelics Regulation

Regulating psychedelics demands a paradigm shift from prohibitionist fear to evidence-based, rights-centred policy. The Transform report underscores that,

effective regulation must prioritise harm reduction, equity, and flexibility,

rejecting one-size-fits-all frameworks. Unlike punitive models that criminalise users, a harm reduction approach acknowledges that psychedelics will be used, and seeks to minimise risks through education, quality control, and safe environments. For example, the report advocates for “licensed access models” that differentiate between medical, spiritual, and personal use, ensuring context-appropriate safeguards.

Central to this vision is the principle that “the setting and intent of use are as critical as the substance itself.” Psychedelics’ effects are profoundly influenced by the environment: a clinical trial administering psilocybin for depression involves meticulous preparation and integration, while an ayahuasca ceremony relies on cultural expertise and communal support. Regulation must therefore tailor rules to these contexts. Oregon’s Psilocybin Services Act, which licenses facilitators and service centres, exemplifies this by prioritising safety without mandating a medical framework, allowing use for both therapy and personal growth.

The report also stresses “the need for iterative policymaking,” as psychedelic science and cultural attitudes evolve rapidly. For instance, MDMA’s pending FDA approval for PTSD will require new guidelines for therapist training and clinic oversight, while decriminalisation initiatives (e.g., in Washington, D.C. and Cambridge) demand parallel investments in public education to reduce stigma and prevent misuse. Flexibility is key: policies should adapt as research uncovers new applications or risks, such as microdosing trends or the rise of synthetic psychedelics.

Critically, regulation must address power imbalances. The report warns against “corporate capture,” where profit-driven entities monopolise access, pricing out marginalised communities. To prevent this, it proposes equity measures like subsidised therapy programs, community-based licensing, and reparative justice for those harmed by the drug war. Indigenous stewardship is non-negotiable: “Traditional use must be legally protected, not tokenised,” the report asserts, urging exemptions for ceremonial practices and co-design of policies with native leaders.

Ultimately, the goal is to balance autonomy and safety. As the report notes,

Adults have the right to explore their consciousness, but also the right to evidence-based guidance and harm reduction resources.

This requires dismantling the false dichotomy between criminalisation and commercialisation, instead fostering an ecosystem where psychedelics serve collective healing, not profit or control.

Embedding Social Justice, Equity, and Human Rights into Policy Design

The Transform report argues that psychedelic regulation cannot succeed unless it actively dismantles the systemic inequities perpetuated by decades of prohibition. “The war on drugs was never about public health, it was a tool of social control,” the report asserts, citing how Black, Indigenous, and Latino communities have borne the brunt of punitive drug laws. For example, despite similar usage rates across races, Black Americans are 3.6 times more likely to be arrested for drug possession than white Americans (ACLU, 2020). Regulation must therefore prioritise reparative justice, including expunging past psychedelic convictions and reinvesting tax revenues from legal markets into communities devastated by the drug war.

Central to this vision is economic equity. The report warns that without safeguards, the psychedelics industry risks mirroring the failures of cannabis legalisation, where corporate giants dominate markets while those criminalised under prohibition are shut out. To prevent this, it proposes:

• Community licensing: Reserving a percentage of business licenses for individuals from disproportionately policed neighbourhoods.
• Non-profit models: Supporting cooperatives and Indigenous-led initiatives, such as the Uñaio Vakiva collective in Peru, which sustainably harvests ayahuasca while reinvesting profits into local education and healthcare.
• Price controls: Capping costs for therapies to ensure accessibility, paired with insurance coverage and sliding-scale payment options.

Indigenous rights are non-negotiable. The report condemns the “biopiracy” of traditional plant medicines, where corporations patent psychedelic compounds without consent or compensation to originating cultures. To rectify this, it calls for legal protections akin to the Nagoya Protocol, an international agreement ensuring Indigenous communities benefit from the use of their genetic resources.

Sacred medicines like peyote are not commodities, they are living traditions,

emphasises Sandor Iron Rope, Lakota activist and former president of the Native American Church of North America. Policies must honour treaties, grant land access for ceremonial harvests, and criminalise the exploitation of Indigenous knowledge.

The report also stresses participatory governance, urging governments to include impacted communities in policymaking. For instance, Oregon’s Psilocybin Advisory Board includes a designated seat for a traditional Indigenous practitioner, while Colorado’s Natural Medicine Advisory Board mandates representation from harm reduction and racial justice advocates. “Nothing about us, without us,” says Kassandra Frederique, Executive Director of the Drug Policy Alliance. “Communities targeted by the drug war must lead this movement, not be consulted as an afterthought.”

Finally, the report links psychedelic reform to broader struggles for human rights. Decriminalising personal use aligns with the right to cognitive liberty, the freedom to explore one’s consciousness, while medical access upholds the right to health. As the UN Special Rapporteur on the right to health has noted: “Criminalising drug use violates fundamental human rights by prioritising punishment over care.” Regulation, therefore, becomes an act of both repair and reimagining, a chance to build systems that heal, rather than harm.

Proposals for Regulation

The Transform report outlines a tiered regulatory framework designed to balance safety, access, and autonomy while prioritising public health and equity. These proposals reject the false binary of prohibition versus unregulated commercialisation, instead advocating for “pluralistic models that reflect the diversity of psychedelic use contexts.” Below are the core pillars of this approach:

1. Medical and Therapeutic Access

Psychedelics like psilocybin and MDMA are poised to revolutionise mental health care, but their medical use demands rigorous oversight. The report proposes “FDA-style approval pathways” with safeguards to prevent corporate monopolisation. For example, therapists administering MDMA for PTSD would require certification in trauma-informed care, while clinics must meet strict facility standards (e.g., calming environments, emergency protocols). To ensure affordability, the report urges governments to mandate insurance coverage and fund subsidised programs for low-income patients. Canada’s Special Access Programme, which grants terminally ill patients access to psilocybin therapy, serves as a pioneering model.

2. Decriminalisation and Personal Use

Decriminalisation is framed as a “floor, not a ceiling” for reform. The report calls for eliminating criminal penalties for possession of small amounts of psychedelics, as seen in Washington, D.C.’s Initiative 81, which deprioritised enforcement. Crucially, decriminalisation must be paired with “public education campaigns” to reduce stigma and promote harm reduction. For instance, Oakland’s decriminalisation resolution included funding for community-led workshops on safe use practices, recognising that “education, not punishment, empowers informed choices.”

3. Licensed Adult Use in Supervised Settings

Beyond medical use, the report advocates for regulated non-medical access through licensed venues like psychedelic retreats or guided ceremonies. These settings would require trained facilitators, dose limits, and integration support. Jamaica’s psychedelic retreat industry, where psilocybin-assisted therapy is legal in supervised contexts, demonstrates how such models can operate safely while respecting cultural traditions. Revenue from licensing fees could fund equity initiatives, such as grants for BIPOC-led wellness centres.

4. Home Cultivation and Community Sharing

To democratise access, the report endorses “personal cultivation rights” for natural psychedelics like psilocybin mushrooms and peyote cacti. This aligns with Oregon’s Measure 109, which permits adults to grow mushrooms for personal use. Home cultivation reduces reliance on illicit markets and empowers individuals to engage with these substances in familiar, controlled environments. However, the report cautions that cultivation policies must protect endangered species (e.g., peyote) and prioritise Indigenous harvesting rights.

5. Cultural and Religious Protections

Indigenous communities must retain sovereignty over their sacraments. The report proposes “legal exemptions” for ceremonial use, similar to the U.S. American Indian Religious Freedom Act Amendments of 1994, which protects peyote rituals for NAC members. Additionally, it calls for laws criminalising the cultural appropriation of traditions, such as non-Native entrepreneurs commercialising “ayahuasca retreats” without community consent.

6. Equity-Centred Market Design

To prevent corporate dominance, the report recommends “anti-monopoly clauses” in licensing agreements and support for cooperative business models. For example, Colorado’s emerging psychedelics regulations reserve licenses for social equity applicants, including those with prior drug convictions. Tax revenues from legal sales could fund reparations, such as reinvestment in communities disproportionately impacted by the drug war.

As the report concludes: “Regulation is not a single policy but an ecosystem, one that must adapt to science, culture, and justice.” By centring these principles, policymakers can create frameworks that honour psychedelics’ complexity while repairing the harms of prohibition.

Psychedelics and the UN Drug Treaties

The international legal framework governing psychedelics, rooted in three United Nations drug control treaties (1961, 1971, 1988), poses a significant barrier to progressive regulation. These treaties, drafted during an era of prohibitionist fervour, classify most psychedelics as Schedule I substances, deemed to have “no medical value” and a “high risk of abuse.” This outdated designation, as the Transform report argues, “ignores decades of scientific evidence and perpetuates a harmful status quo.” For instance, psilocybin and MDMA, now recognised as breakthrough therapies for depression and PTSD, remain trapped under restrictive global laws that stifle research, limit access, and criminalise cultural practices.

The Conflict Between Science and Law

The report highlights a glaring contradiction: “The UN’s scheduling system is based on political compromise, not empirical data.” Psychedelics’ Schedule I status, shared with heroin and cocaine, ignores their low potential for addiction or overdose. For example, a 2010 study in The Lancet ranked psilocybin as one of the least harmful recreational substances, yet international law treats it as a grave public health threat. This misclassification has dire consequences: researchers face bureaucratic hurdles to study Schedule I drugs, clinicians cannot prescribe them, and Indigenous communities risk prosecution for using ancestral medicines like ayahuasca or peyote. Despite these challenges, the Transform report outlines pathways for reform. Nations can leverage treaty flexibilities, such as:

• Rescheduling: Countries may petition the UN to reclassify substances based on new evidence. The 2019 reclassification of cannabis, following a WHO review, sets a precedent.
• Medical Exemptions: Article 7 of the 1971 Convention allows nations to permit medical and scientific use of controlled drugs. Canada’s Special Access Programme, which grants psilocybin access to terminally ill patients, exemplifies this approach.
• Cultural Protections: The 2007 UN Declaration on the Rights of Indigenous Peoples (UNDRIP) could supersede drug treaties, protecting ceremonial use. Ecuador, for instance, has constitutionally recognised Indigenous rights to traditional plant medicines.

Calls for Systemic Reform

The report urges nations to “challenge the treaties’ moralistic foundations” and advocate for modernisation. It praises countries like Mexico, which in 2021 proposed eliminating the UN’s “fiscal sanction” mechanism that punishes nations for reforming drug laws. Similarly, Bolivia’s 2011 re-accession to the 1961 Convention with a reservation allowing traditional coca use demonstrates how sovereignty can be asserted.

Justice and Equity in Global Policy

Critically, the report frames treaty reform as a decolonial imperative. The war on drugs, enforced through UN mandates, has disproportionately targeted Indigenous and Global South communities. For example, peyote, central to the Native American Church, is endangered due to criminalisation and habitat loss, while non-Indigenous “psychedelic tourism” in the Amazon often exploits sacred traditions. “The treaties institutionalise colonial violence,” the report states, urging reparative measures like funding Indigenous-led conservation and granting intellectual property rights over traditional knowledge.

The Transform report concludes with a rallying cry:

The UN must reconcile its drug policies with human rights and scientific truth.

This requires bold leadership from member states, grassroots advocacy, and centring the voices of those harmed by prohibition. As the psychedelic renaissance reshapes healthcare and culture, international law must evolve, or risk irrelevance.

David Blackbourn | Community Blogger at Chemical Collective

David is one of our community bloggers here at Chemical Collective. If you’re interested in joining our blogging team and getting paid to write about subjects you’re passionate about, please reach out to David via email at blog@chemical-collective.com