'Psychedelic wellness' centers close, leaving ketamine patients in 9 states dry and not high

Ketamine Wellness Centers promised a "life-changing" method to treat suicidal ideation, depression and PTSD. But its abrupt closure  last week has left mental-health patients in Arizona and eight other states without access to drugs or therapy.

One of the nation's largest chains of ketamine clinics, which started in Phoenix, ceased operating with no advance notice to patients, deadbolting its offices, posting a note on its website, and sending an email.

The company provided scant advice to patients who are in the middle of drug infusion treatment about how to handle being cut off. It also did not provide any information about how to recover hundreds or thousands of dollars in prepaid costs.

The company gave patients a 1-800 number for accessing medical records and told them its parent company is to blame for expanding operations too fast.

"Due to the inability of (parent company) Delic to meet the financial commitments of the rapid expansion, we were forced to abruptly close all clinics and the corporate office," the company said in an email notice to patients.

"We are ethically and medically required to ensure employees are properly compensated and plan of care is managed appropriately."

That plan, as referenced in an attachment, is simply a list of other ketamine clinics in the states where the company operated: Arizona, Colorado, Florida, Illinois, Nevada, Minnesota, Texas, Utah and Washington.

In other words, no substantial plan or managed care for patients like Charmaine Wahlstrom, who was scheduled to get her first ketamine infusion on Monday in Gilbert, Arizona.

"I am angry and frustrated," Wahlstrom said Friday. "It's concerning to me their message did not say anything about returning the money they had been paid. And how does it work for people who started infusions and suddenly stopped?"

Wahlstrom, 64, is from Minnesota and lives in Arizona in the winter months. She said she chose Ketamine Wellness Centers because it had clinics in both states, making it easy to continue treatment all year long.

"I was supposed to start on Monday: three infusions the first week on Monday, Wednesday, Friday, and three more the next week," she said. "I cannot reach a real person."

An initial round of ketamine infusions can cost about $3,000. Because the drugs are not approved by the Food and Drug Administration, insurance does not cover most ketamine infusions.

Wahlstrom paid $125 for a screening process that included a psychological and medical exam. She also paid $449 for the first day's ketamine infusion.

When she called her case manager on Thursday, Wahlstrom said she got a message from the manager saying she had left the company a day earlier. There was no additional information.

Wahlstrom said she has long suffered from depression and spent months looking into ketamine treatment, which typically involves an initial battery of six infusions coupled with therapy and followed by regular infusions depending on need.

She said she learned about ketamine online and from talking to people on social media.

"Your quality of life can be greatly improved by getting ketamine treatment," Wahlstrom said, adding the drug "opens up your mind and expands your mind."

Wahlstrom said she filed complaints on Friday with the Arizona Medical Board and the Arizona Attorney General's Office.

Neither Ketamine Wellness Centers nor its parent company responded to calls from The Arizona Republic, part of the USA TODAY Network.

Date-rape drug used as mental-health treatment

Ketamine clinics are popping up across the United States, with at least a dozen operating in Arizona. They offer non-FDA approved infusions or injections. They claim to treat pain, anxiety and obsessive-compulsive disorders in addition to suicidal thoughts, depression and post-traumatic stress disorder.

Ketamine, popularly known as the party drug "Special K," also has a dark reputation as a date-rape drug, It was introduced in the early 1960s as an animal anesthetic used by veterinarians. A decade later, hospitals started using it for pain management and to help calm human patients.

The U.S. Drug Enforcement Administration describes ketamine as "a short-acting anesthetic with hallucinogenic effects." It can distort sights and sounds, induce feelings of calmness and relaxation and provide relief from pain, immobility and amnesia, with effects lasting up to 60 minutes.

Research in 2013 suggested ketamine could be used to treat people with mental illness. Studies by the Baylor College of Medicine and Mount Sinai Hospital in New York City found it could "alleviate depression symptoms in just hours."

The Food and Drug Administration in 2019 approved a specific type of ketamine for use in a nasal spray for adults who have tried at least two other antidepressant medications without success.

However, the agency warned in 2022 that "ketamine is not FDA-approved for the treatment of any psychiatric disorder." It concluded that the FDA has not evaluated the safety, effectiveness, or quality of ketamine-based drugs and they "should only be used in patients whose medical needs cannot be met by an FDA-approved drug."

Closure 'could put patients in very vulnerable positions'

Rudy Montijo is the chief operating officer and lead therapist at Daytryp Health, a ketamine clinic that opened in Phoenix three weeks ago. He said the failure of Ketamine Wellness Centers could hurt patients.

"It could put patients in very vulnerable positions, especially if they are already on a plan," he said, adding it could exacerbate their conditions.

Daytryp is built on an "east-meets-west" approach to treatment, a combination of medical science and spiritual healing, Montijo said. The company also assigns patients "trip guides" to steer them through any hallucinations or "out-of-body" experiences brought on by the drugs.

The treatment can be calming and conducive to healing, Montijo said.

The company's chief medical doctor is an emergency room physician from Mayo Clinic in Arizona and Banner Desert Medical Center in the Phoenix suburb of Mesa.

Montijo said the industry has seen other closures and is still in the early stages of development. He said some businesses have focused too much on growth models rather than patient needs.

"It could be one of those situations where people grew too fast without a good understanding of the market," he said.

Why did the ketamine centers close?

An example of the freewheeling nature of the ketamine therapy business was on full display Friday. Plastered to the door and window of the closed Ketamine Wellness Centers' Gilbert office was a handwritten flyer from another clinic: "Accepting new patients ― two locations," the flyer read, with a phone number and email provided at the bottom.

The flyer was not from one of the clinics listed as an alternative in the email sent to Ketamine Wellness Centers patients, which stressed the closure was the result of being acquired by a publicly traded company.

"Ketamine Wellness Centers (KWC) has been delivering quality care since 2015," doctors Mark Murphy and Ellen Diamond wrote. "In November of 2021, KWC was acquired by Delic Holdings with the intent of the publicly traded company to provide funding for rapid expansion. The original founders remained as operators and employees of KWC to facilitate the expansion and increase the access to this life-changing treatment."

Delic Holdings Corp. of Vancouver, Canada, is a media, e-commerce and event company related to psychedelic treatment. It owns Delic Corp.

On its website, Delic Corp bills itself as a leader of "new medicines" and claims to be "reframing the conversation on psychedelics."

Delic Corp CEO Matt Stang, the former owner and operator of High Times magazine, pushed for the legalization of cannabis in several states. He touted psychedelics in a company statement.

"Psychedelic wellness has the potential to help tens of millions of people," Stang said. "We are on the cutting edge of new treatments that show incredible results for serious mental health conditions such as depression, anxiety, PTSD, Parkinson’s disease, and more."

Delic is positioned to "capture the full impact of the exploding psychedelic wellness industry, emerging technology and breakthrough treatments, and serve as the trusted resource," he said.

Murphy and Diamond on Thursday asked patients in Arizona for understanding.

"It is our desire to resume therapy under a new business model in many of our markets in the immediate future," they said in the email.

Robert Anglen is an investigative reporter for The Republic. Reach him at robert.anglen@arizonarepublic.com or 602-444-8694. Follow him on Twitter @robertanglen.

This article originally appeared on USA TODAY: Ketamine Wellness Centers close in 9 states, leaving patients in lurch