Inner Cosmos, Outer Expansion: Are We Ready For Psychiatric BCI?

Forbes

02-04-2025

Inner Cosmos is a startup reinventing care for depressed patients unresponsive to conventional pharmaceutical therapies. Since the FDA granted the company a device exemption to initiate a feasibility study in 2022, they have fitted three patients with their Digital Pill device. This makes the company an early first mover in psychiatric brain-computer interfaces and ushers in a new era for the BCI field.
Writing new brain chemistry at the push of a button is not a new idea. Deep brain stimulation and other surgical implants have long been used in neuropsychiatric research as an investigational treatment in cases of severe mental illness, including treatment-resistant depression. For the trio who have joined this study seeking help, and others to follow from a population of several million similarly diagnosed people, Inner Cosmos has built a BCI that enables an early glimpse of a patient-centered, clinically-driven care model unlike anything else on the market today.
Each participant received a coin-sized device embedded on top of the skull in an outpatient surgical procedure that leaves the skull's inner table intact. By avoiding all contact with blood vessels, the dura and the brain itself, the procedure reduces infection risks and damage unachievable by other BCIs that self-describe as 'minimally invasive.'
Once embedded and configured, the pill mimics transcranial magnetic stimulation, pulsing into specific targets in the dorsolateral prefrontal cortex. The patients activate the treatment daily, which is delivered without scheduling, office visits, or transportation, in the comfort of their own homes.
I spoke with several of the company's founders, leaders, and one of the three pioneering study subjects to learn more about this emerging field, starting with a question both philosophical and technical.
The very definition and its limits are what co-founder Eric Leuthardt, MD has challenged over a three decade career developing and commercializing brain recording and stimulation devices: How best to design new neurotechnologies that minimize degrees of invasiveness to the brain, while delivering a clinically efficacious dose-response, productized and commercially calibrated to help the most people possible?
Leuthardt splits his time evenly between practicing neurosurgery and leading neurotech across numerous departments at Washington University in St. Louis. Along with Dan Moran, Inner Cosmos Head of Preclinical Studies and co-founder, he is a serial entrepreneur. The pair's last startup overcame the neurotech valley of death with the Ipsihand, a stroke rehab device, based on Leuthardt's vision for a clinical grade non-invasive BCI, which he points out is the only cleared and reimbursed BCI on the market.
The idea for Inner Cosmos emerged over the 2010s, in conversation with that decade's historic clinical breakthroughs in neuroprosthetic BCIs. 'The evolution of understanding motor systems gave us the ability to interact through technology, to deliver meaningful improvements in those patients,' Leuthardt explained. 'We're seeing that same evolution here. We are better understanding the network dynamics associated with mood and depression, which, in turn, allows us to fine-tune brain electrophysiology for therapeutic benefit.
Inner Cosmos' stimulation parameters are one of several attributes under active development and evaluation at this early stage. Today's device does not record electrical data, meaning adjustments to the treatment protocol are made with a human-in-the-loop, e.g. a patient's psychiatrist, through standard clinical assessments like MADRS.
While 'closed-loop systems' appear suddenly en vogue, they remain commercially unviable for today's mass-market, limited by mission-critical factors of clinical workflow, reimbursement criteria, and most importantly, patient autonomy. For reference, it took Medtronic 30 years to develop aDBS.
Even though timelines to build, validate, and clear such products are shrinking, suffice to say a clinical-grade BCI to automatically detect and zap away undesirable moods requires a deeper understanding of the disease than we have in clinical practice today.
The Inner Cosmos team put me in touch with one of the trial participants in their study at Washington University, whom I spoke with for 45 minutes, accompanied by one of the trial coordinators.
'Eric' offered a generous conversation that traversed his challenging career as an emergency services professional, his healthcare journey, and recent personal experience living with Inner Cosmos device as an early stage psychiatric BCI pioneer.
Depression first struck Eric nearly twenty years ago, beginning with the birth of his child, after which on-the-job experiences began to linger. The following decades were marked by a pattern of incidents involving exposure to incidents of violent trauma, stress-related breakdowns on the job, changes to his employer, medications, and counselor. After a messy termination in 2022 put him face-to-face with the end of his career, 'I completely fell to pieces,' he said. He enrolled into disability and transitioned into focusing on his health full-time.
His search for other treatment options began with TMS for depression and anxiety, which he completed through a Washington University clinical program, during a broader time of medication changes, lifestyle adjustments, and administrative upkeep. Then, Wash U sent him a letter about the Inner Cosmos study.
'I looked through it, and I was intrigued,' Eric told me. 'I said, You know what? I've tried some other things so far, and the TMS therapy was frankly uncomfortable, but you get used to it and it did seem to help a little bit.'
Following a meeting with the project coordinator, his initial apprehension turned to contemplation, and then questions. He said he's not always a fine-print guy, but in this case he read every word of the clinical literature provided to him. 'The reason I went through with it really was because of the experience I had with the people at WashU.' He noted their 'empathy, and candor about what to expect.'
The device was fitted around Thanksgiving 2023. After brief post-surgical soreness and a few instances of mild nausea upon initiation of treatment, he began using it daily, turning on to administer the treatment stimulation. Eric described the apparatus as 'the command unit' and walked me through the details of his usage, including timing, duration, sensory experiences.
He has 'never felt any pain, ever.' He describes instead a mild pressure that soon faded into the background after daily use, to the extent that he described a period of apprehension wondering if the device was even working as he went about his days. Today, it's smooth sailing: 'I'll get up in the morning, I'll put it on, I'll come downstairs, get coffee, make breakfast, go outside if I need, you know, get up in the morning, go to yard work, whatever it is.'
Bearing in mind this is not clinical data, but an anecdotal account: Eric was eager to share some recent glimmers of progress during the trial. Several months into the study, he observed a shift. 'I started to notice that my mood was lightening, and that I was feeling better, and that kind of continued on.' His reporting numbers grew more consistent, too. 'The number of bad days were starting to be not as much as the number of good days. And so that has been pretty consistent now for the last six or seven months.'
He insists he is not 'cured' and still has bad days, but described living through them with more resilience than before. He encourages anyone interested in this approach to do their research and find healthcare professionals they trust who are part of the trial. For what it's worth, after the first 12 months, Eric opted into a one-year extension in the study. 'If it's something that is helping me, I do intend to keep using it.'
For now Eric is moving forward, in the study and beyond it.
'Really, just within the last few months, I've really started to venture out again, not like I used to, but it's, you know, it's been, it's been good all the way around. I have to say that the last few months have been really good.'
CEO Meron Gribetz joined Leuthardt and Moran as a founder to lead the company and build a winning business model around a decade of pre-clinical R&D. With a global team of 15 and a seed round targeting $15M (12.6 has already been invested, in two tranches), he has advanced the clinical-stage platform to where it is today, with three human-years of data and growing. Gribetz is also leading the next iteration of the device and technology platform, which includes the pivotal study and commercialization.
'Right now we're focused on safety. Next, it's 'Can we deliver the same clinical treatment that TMS can offer?' ' Gribetz said. 'Because TMS is a gold standard of industry at this point.'
Demonstrating TMS-like efficacy is a long-term focus of the company's chief medical officer Darin Dougherty, MD who joined to oversee all human trials, starting with their current feasibility study at Mass General. Dougherty is the director of the division of neurotherapeutics, department of psychiatry, where he sits on a neurosurgery committee. He has led the psychiatric clinical investigations of other treatments and devices, including DBS, ECT, and vagus nerve stimulation.
'My whole career has been on the electrical side, rather than the chemical side, trying to develop new treatments or refine existing treatments to help people with these disorders,' Dougherty explains. He points out that of 44 approved antidepressants 42 are monoamines. 'We probably don't need a 43rd. There are people who have just not benefited from these conventional therapies, and we're trying to find ways to help them. So that's what I'm interested in, and what I've dedicated my career to doing.'
He first joined as an advisor. Given how many neurotech companies he encounters, I asked Dougherty what stood out about Inner Cosmos that drew him to a leadership position there. His reply was direct: the treatment protocol itself.
'Inner Cosmos has built TMS to-go. Only one percent of patients use TMS because it is limited to healthcare settings. The game there is not reinventing the wheel. This is the same therapy. It's making it portable and more accessible.'
Transcranial Magnetic Stimulation has failed to reach 1% of eligible patients
'TMS to-go' would amount to a paradigm shift in psychiatry. Despite being completely non-invasive, FDA-cleared since 2008, and reimbursed by most payers, TMS's utilization has been abysmal. This stems largely from poor treatment-market fit that requires severely depressed patients to attend 30-in-clinic sessions of the 'repetitive' or rTMS clinical protocol. It is this very group of people that Inner Cosmos is building for.
The marketplace is changing rapidly for both the millions of eligible TMS patients in the coming years as well as their psychiatrists. One possible major disruptor is a new, accelerated 1-week TMS protocol called SAINT, which startup Magnus Medical has just started rolling out in select clinics.
The near future may soon include even shorter outpatient TMS protocols. Outside of TMS, low-intensity focused ultrasound and wearable transcranial direct current stimulation devices are all in different stages of clinical studies, along with psychedelic medicines and beyond.
Helping match patients to treatments will fall on the 7000+ psychiatric clinics nationwide. This heterogeneous market includes its own competitive ownership structures, clinical networks, marketing channels, and preferred partnerships with treatments from pharma to traditional TMS manufacturers and beyond.
Inner Cosmos isn't worried about the competition. Leuthardt predicts 'a spectrum of complementary strategic approaches for how you treat these patients,' rather than monolithic guidelines. 'Depression is what I would consider a network apathy, a distortion of networks. And human beings are distinct and unique in what their needs are. Demands for solutions will also vary substantially.' He points out that those who have already tried recurring TMS sessions might be more open to a more convenient option, and suggests that people who have shown benefit from TMS are perfect clinical candidates for Inner Cosmos, too.
As part of their diligence in investing in the company, Extera Partners commissioned a US market research survey of physician leaders at psychiatric clinics around the country. Portions of this report were shared with me by Extera's Founding Partner Joseph Baron. In addition to providing data driving the company's projections of $2.4b in serviceable, US-based revenue, the results reinforce psychiatrists' overarching interests in clinical efficacy and patient safety, their acute awareness of TMS's value and limitations, and growing interest in new treatment options.
Like many medical device startups, Inner Cosmos faces typical challenges with product commercialization. Implantable Pulse Generators, while a common component of various cardiac and bioelectronic procedures including today's class of BCIs, could be a harder sell in mental health for both patients and psychiatrists. The same might hold true for the new surgical procedure.
While Inner Cosmos plans to swap in a wireless charging system for the IPG and add broader digital health tools in their next-gen device, these amount to transformational upgrades, which will require additional capital to fund development and pursuit of regulatory approvals of varying complexity. Lastly, spearheading their early product into psychiatry will require strong education and engagement tactics, as preferred partnerships in medical subspecialties can become innovation cliques that stymie uptake of new, different approaches.
Inner Cosmos also faces a strong competitor in Motif. Though behind on human clinical studies, they are pursuing a similar but not identical approach with their DOT device. Motif won a multi-million dollar grant from the UK-based ARIA program this year, following an $18m Series A fundraise last year from several notable investors.
The most important variable for any BCI company will be reimbursement, which remains a multifaceted and somewhat mythical question across all categories. Inner Cosmos is studying reimbursement based on current payments and codes, which they believe could support a rapid launch.
Morgan Stanley analysts used a price of $30k for a category of 'therapeutic BCI' in last fall's market sizing report, in which depression is by far the largest market, comprising 60% of the long-term and 75% of the short-term opportunity. This amounts to $242.5 billion in 20 years, and $62.5 billion over the next decade.
Morgan Stanley's early market breakdown for Brain-Computer Interfaces (BCI) suggests treatment ... More resistant depression will drive 75% of global BCI revenue, to the tune of $62.5 billion - over the next decade.
Beyond conjecture about device costs and business models, the major takeaway here is a question: Why is BCI funding so heavily skewed to substantially smaller market opportunities? Motor and Communication BCI, in addition to lacking strong precedents in both clinical value creation and commercial reimbursement, have a growing list of well-funded competitors that have raised over $1b collectively.
Psychiatric BCI startups by comparison, have raised less than $40m in total to date, despite facing the far bigger market opportunity. Calling this 'the black hole in the pie chart,' Gribetz brings up Extera's $2.4b annual revenue opportunity figure, based on conservative patient capture. 'Nobody's talking about the serviceable, addressable and obtainable market. To me, if you're investing in healthcare and especially BCI, psychiatric care is the most attractive area and closest to commercialization.'
Inner Cosmos's emergence comes amidst a broader evolution in neurotech.
At the end of last year, Motif's founder, Jacob Robinson, led a group of authors who published a concise paper arguing that BCI terminology should be updated to two major categories, movement/communication and treatment, to promote clarity in regulation, investment, and public engagement. It struck me as a call to action for the field, long cloistered by research scientists and technical experts, to reimagine itself with people and human goals at the center.
The paper also distinguishes between 'non-invasive' and 'invasive' technologies, citing an umbrella definition from the recently formed iBCI-CC. This transcends wordplay and speaks to a murky ethical dilemma of categorizing and comparing surgically installed BCI. Leuthardt has long called for more specific language than 'minimally invasive' to guide clinicians, regulators, investors, and the general public. In 2021 he co-authored a paper to delineate different risk profiles of BCIs.
Dr. Eric Leuthardt co-authored a 2021 paper representing degrees of invasiveness of different BCI.
It's a heady read, but the resultant triangle diagram offers a rubric for BCI industry to balance three things: surgical risk, amount of information required from a person's brain, and severity of clinical need. This triad offers a human-centered, application-agnostic framework for evaluating BCI design.
'A lot of people like to use the term minimally invasive now,' he said. 'But this sometimes conflates the understanding of risk. I'm very mindful of that terminology because people talk about minimally invasive, invasive, intravascular, subdural, epidural. As a neurosurgeon, I think about whether you're inside or outside the inner table of the skull. This offers a clear distinction for what kind of neurosurgical risk you're talking about.'
That the actual invasiveness of any minimally invasive BCI may not seem to matter very much anymore speaks to the need for such a rubric. But in 2025, has that need passed?
Continued interest in and commercial resurrection of DBS for treatment resistant depression by Abbott forces the question: Should patients be offered an embedded skull device before fully invasive DBS electrodes to try and treat their depression?
The economic climate has also evolved from five years ago. Today, it seems a surge of buzz on neural-data informed foundation models could inspire the launch of new companies or products in pursuit of more expansive interfaces than clinically necessary, in part to maximize unique datasets for commercial licensing opportunities.
Around the world, BCI has captured the imagination of millions and raised capital in the billions. But as the field marches through historic milestones, this year presents a crossroads question about where it's headed.
Will BCI be built for all, or just for some?
In public, BCI leaders, advocates, and pioneers have taken a measured approach in addressing consumer access, establishing industry norms and downplaying expectations. Some have speculated that a future consumer market for BCI would resemble LASIK eye surgery or cosmetic procedures: serious but routine, completed as an elective outpatient procedure and covered by insurance.
But in private, some leaders of BCI companies for paralyzed users have had to defend the commercial viability of advancing costly technologies for specialized populations comprising dysfunctional markets. A new wave of investors has already begun venturing out for ideas in newer areas, both niche and wide. I've spoken to some hapless founders pursuing indications so niche as to be irrelevant, just to stand out during fundraising.
What if a far bigger short-term (and long-term) market also turned out to be a better fit for the public's imagination? Could this new kind of BCI - offering precise, in-home dosing of neurostimulation to improve daily life - overtake the Neuralink-inspired mental mouse cursor daydream to win broad crossover appeal, driven by lower invasiveness and stimulation for psychological or cognitive improvement?
To be clear: The consumer version of a psychiatric BCI like Inner Cosmos' Digital Pill may be just as distant or hypothetical as any other BCI. But given the sheer scale and gradient nature of mood disorders, the BCI field has much to gain by including such psychiatric neurostimulators into their midst, and engaging the public about their emergence, attributes, and designated applications. Those building this medical-consumer bridge might borrow notes from the long evolution underway in vagus nerve stimulation.
Moreover, following this era's historic destruction, holding up a big tent could prove advantageous in the rebuilding years, if the neurotech field seeks to establish favorable regulatory reforms. Finally, inclusivity could lead to non-competitive synergies, like capital efficient sourcing, or best-practice exchanges that result in better BCI.
Debating definitions of what does and doesn't count as BCI should not come at the opportunity of advancing next-gen products that bridge to the future based on human user feedback.
While most of us won't be eligible for a psychiatric BCI, millions could be. For a field with so much to prove, on-demand, in-home neurostimulation to help people like Eric seems like an opportunity worth advancing.