Mental health is a growing priority among American adults, driving a rise in mental health-related consultations over the past few years.

According to Gallup, the percentage of adults who consulted a mental health professional at least once in a 12-month period has risen from 10% in 2001 to 24% in 2025.

With mental health becoming a key concern among Americans, the anxiety and depression treatment market is expected to grow from nearly $13 billion in 2025 to $17 billion by 2035, at an annual rate of 3%.

One of the companies that’s attempting to serve this growing market is AtaiBeckley (ATAI).

AtaiBeckley specializes in developing mental health therapies. Formerly known under the name of Atai Life Sciences, the company changed its name following the acquisition of biotech firm Beckley Psytech in 2025.

AtaiBeckley today is a clinical-stage biotech firm that’s in the process of developing various psychedelic-based neuroplastogens—drugs that are used in treating mental health disorders.

Among the drugs in development is BPL-003, a nasal spray that has earned a U.S. FDA Breakthrough Therapy designation and is currently in Phase 3 trials. The drug is designed to treat treatment-resistant depression (“TRD”), a form of depression that isn’t alleviated by common antidepressants.

Other drugs in clinical trials include VLS-01, a dissolvable strip designed to treat TRD, and EMP-01, a treatment for social anxiety disorder.

The experimental drugs that AtaiBeckley is actively developing have the potential to position the firm as a key player in the anxiety disorders and depression treatment market.

That said, investors seem to be undervaluing this firm.

We can see this through Valens’ Embedded Expectations Analysis (“EEA”) framework.

The EEA starts by looking at a company’s current stock price. From there, we can calculate what the market expects from the company’s future cash flows. We then compare that with our own cash-flow projections.

In other words, the EEA shows how well a company has to perform in the future to be worth what the market is paying for it today.

AtaiBeckley delivered a Uniform return on assets (“ROA”) of 62% while simultaneously delivering a Uniform asset growth of 164% in 2025. Despite this, the firm is only trading at a Uniform P/E of -43x.

At current valuations, investors expect AtaiBeckley to deliver a Uniform ROA of 15% by 2030, well below the 62% it delivered last year.

The EEA framework suggests that AtaiBeckley is being undervalued by investors. And that’s exactly why pharmaceutical giant Eli Lilly (LLY) acquired the firm in July.

Under the terms of the deal, Eli Lilly will acquire AtaiBeckley for $6.75 per share, a 26% premium. Investors of the latter will also receive contingent value rights that could be worth as much as $2.50 per share.

AtaiBeckley’s drug programs show immense potential, and since it’s being undervalued by investors, it became an acquisition target of a much bigger company.

Best regards,

Joel Litman & Rob Spivey
Chief Investment Officer &
Director of Research
at Valens Research

Today’s article only scratches the surface of what we share with our FA Alpha Members. If you want to get an in-depth analysis of market trends, uncover undervalued stocks, and more, become an FA Alpha Member today.