Deep Mind are working on the biology thing and more specifically study of the human brain. Demis Hassabis, the main guy at Deep Mind did a PhD in cognitive neuroscience and is focused on that stuff. Not so sure about psychedelic research - I don't know how you'd use that to build computer systems even if the Google dream pictures are pretty trippy looking.
Actually, you just brought up a great point. The Google dream pictures are very similar to what you might see during a psychedelic experience.
I admit I don't know how psychedelic research could help in building AI, I'm just saying that my hunch is that a breakthrough in AI will come about from left field somewhere.
(https://www.google.com/search?q=google+dreams&num=20&tbm=isc...)