In “The Hounds of Baskerville,” the hallucinogenic project acronym revealed is H.O.U.N.D.
Sherlock initially treats the “hound” as something that may be more than a literal animal. His investigation leads to Baskerville, a Ministry of Defence research facility connected with secret experiments. The apparent monster is ultimately explained by a chemical agent that produces intense, frightening hallucinations.
H.O.U.N.D. was a secret CIA project intended to create a hallucinogenic anti-personnel chemical weapon. The project was officially abandoned, but Dr Bob Frankland continued experimenting with the substance. The gas explains why Henry Knight and others believe they have seen a gigantic supernatural dog on Dartmoor.
The acronym also connects the hallucinations to Henry’s childhood trauma. Sherlock concludes that Frankland used the drug to reinforce Henry’s memories of seeing his father killed. The episode’s title echoes Arthur Conan Doyle’s “The Hound of the Baskervilles,” but the BBC adaptation replaces the supernatural mystery with a modern conspiracy involving psychology, chemistry and military research.