Inside the legal MDMA and psilocybin magic mushroom trade | The Business | ABC NEWS

For decades, MDMA, also known as ecstasy or molly, has been traded underground and illegally ingested in the shadows of parties and nightclubs. It is a hard drug known for its euphoric high, and side effects can be fatal. But at a manufacturing hub in Brisbane, MDMA is being packed into capsules, for hospitals and clinics across the country. It isn’t the only drug processed at the lab. Bags of mushrooms are weighed before the active ingredient inside, known as psilocybin, is extracted. On the black market they are known as magic mushrooms and are sold for their hallucinogen effects. But in this facility, they have a therapeutic use. The business manufacturing these drugs is Breathe Life Sciences. It’s been granted one of the highly regulated licences to work with these drugs in Australia. For the first time, the ABC can take you behind the scenes of its production line, inside the vaults, and all the way to the patients in therapy.

In 2023, Australia changed its laws, becoming the first country to allow authorised psychiatrists to prescribe MDMA for post-traumatic stress disorder (PTSD) and psilocybin for treatment-resistant depression. It is given under strict supervision in clinic. While some studies indicate there is no evidence that psychedelic therapy is effective at treating mental health conditions, others in the industry believe it’s a breakthrough. Adam Guastella from the University of Sydney’s Brain and Mind Institute says the treatments may not be suitable for everyone and should only occur under medical supervision. “A smaller portion of people could experience nausea and vomiting immediately … Longer term, there are reports of more significant side effects around hallucinogenic experiences that happen in a small number of people … We know for MDMA … having serious cardiac issues is a contraindication to receiving it. If people are taking antidepressants and then they take some of these drugs, they can have very, very serious side effects. Professor Guastella says it’s important to separate the illicit drug from the drug taken in the therapy room.

In June 2025, Medibank private became the first health insurer to fund psychotherapy. The Department of Veterans’ Affairs (DVA) is also providing veterans with access to psychedelic-assisted psychotherapy for those with severe PTSD and treatment-resistant depression, where other treatments have not worked. As it stands, MDMA and psylocibin make up about 1 to 2 per cent of sales at Breathe Life Sciences. One of those sales is to the Empax Centre in Perth, which is one of the few clinics across the country offering psychedelic-assisted therapies. Breathe Life Sciences boss Sam Watson says his company was given the green light to start manufacturing both MDMA and psilocybin just over two years ago. While the company’s main product is medicinal cannabis, he expects sales of MDMA and psilocybin to grow.

Scott Phillips, chief investment officer at The Motley Fool says “If this is the next big drug, then this is a massive, massive market. If it does flame out and remains a niche therapy … it will disappoint a whole lot of people, including investors in these companies.”
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