One of the largest operators of ketamine clinics in the country abruptly closed its facilities this week, leaving patients in the dark and out of treatment for depression and other chronic conditions.
Ketamine Wellness Centers spanning nine states were shuttered, leaving laid-off employees and patients with more questions than answers. Interest in ketamine to treat depression and other conditions has grown in recent years. A short-lived anesthetic turned party drug, it’s now being studied for its benefits to those with psychiatric disorders that don’t respond to other treatments. And there is a push by some to expand its use to treat other conditions, such as substance use disorders.
The centers were run by Delic Corp., a subsidiary of the publicly held Canadian company Delic Holdings Corp. Delic calls itself the “leading psychedelic wellness platform” in the U.S., and has hinged its growth on the potential legalization of MDMA and psilocybin treatments. The company’s CEO since January 2021 is Matt Stang, the former chief revenue officer of High Times magazine, which pushed for the legalization of cannabis.
Delic Holdings also runs the psychedelic and cannabis-focused Delic Labs out of Vancouver, Canada, and in 2021 acquired Ketamine Wellness Centers, which ran clinics in states such as Arizona and Washington. Delic is characterized as a media, e-commerce, events, and clinic company. The company’s website touted itself as running the “largest profitable network of clinics” in the country.
As of Wednesday afternoon, the Ketamine Wellness Centers website displayed a banner on the homepage: “Delic announces suspension of Ketamine Wellness Centers Operations,” with an email and phone number for patients to obtain their medical records. No other information was immediately available about the closure of the 12-year-old company.
The clinics were started in 2015 by Dr. Mark Murphy, an anesthesiologist, psychologist Ellen Diamond and businessman Kevin Nicholson. The first clinic, in downtown Phoenix, specialized in low-dose ketamine infusions. The following year, it moved to a larger building in a suburb, where it could serve its growing clientele, which included patients traveling from abroad for their treatments, company documents say. The business soon expanded to satellite clinics and other locations near Denver, Seattle, and Minneapolis, making it the largest privately owned ketamine provider in the country at the time, according to the company documents. By the time the company was acquired by Delic, it had seen a 1000% increase in treatments in four years.
This year, the company had hoped to expand to at least seven additional locations, the documents show. Now, all are closed.
STAT reached out to the communications director for Delic Corp. and Ketamine Wellness Centers. An automatic reply email said, “Today is my last day” with the companies. It is unclear when the automatic reply message was set. Messages to other Ketamine Wellness Centers and Delic employees went unanswered.
Suspicion is swirling around the closures, and the impact it could have on patients who depended on Ketamine Wellness Centers for specialized treatments, such as ketamine infusions and IV drips of nicotinamide adenine dinucleotide (NAD) often given at med spas. Some of the Delic clinics also offered Spravato, a Food and Drug Administration-approved version of esketamine that comes in a nasal spray, for adults with treatment-resistant depression, major depressive disorder, or suicidal thoughts or actions. Ketamine was approved by the FDA as an anesthetic and is used off-label otherwise. At least a dozen telehealth companies have begun prescribing ketamine online, some catching heat for the practice.
Given growing interest in psychedelic medicine, the Ketamine Wellness Centers’ sudden closure was puzzling, but not unprecedented. On Wednesday, the ketamine clinic business Field Trip announced the closure of five of its facilities: Chicago, Washington D.C., Seattle, San Diego, and the Canadian city of Fredericton. Earlier this month, Oregon’s Synthesis Institute, a magic mushroom therapy center, ran out of money and shut down. Oregon is set to begin a legal psilocybin program later this year.
In a January blog post, Delic Holdings CEO and board member Nicholson described growth in the ketamine clinic business as being not “as expansive as we had planned” in 2022. The treatment centers, which offered a variety of therapeutics for psychiatric conditions ranging from depression to PTSD and chronic pain, administered 12,000 infusions, about a 23% jump from the previous year. The clinics also saw an increase in “insurance-based” treatment, with nearly a third of patients falling in that category. Health insurers have so far not covered psychedelic-assisted interventions, but may cover drugs like Spravato when they are deemed “medically necessary.”
In the post, Nicholson expressed optimism about having the clinics provide MDMA-assisted therapy down the road, should such treatment be approved by the FDA. “Delic / Ketamine Wellness Centers is perfectly positioned with our clinic size, treatment hours, in-room service, and insurance coverage to be one of the first companies to be able to offer this therapy to the community,” the post said.
STAT’s coverage of chronic health issues is supported by a grant from Bloomberg Philanthropies. Our financial supporters are not involved in any decisions about our journalism.
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