They work by stat multiplication: damage x shooter psysense x target psysense. And there is no hard cap.

So, for example a pawn with 200% psysense will deal x3 damage vs a pawn with 150% psysense (2 x 1.5 = 3), and x0.5 damage vs a pawn with 25% psysense (2 x 0.25 = 0.5).

You might have realized that with such a formula the weapon should deal no damage vs a pawn with 0% psysense, no matter what. To counterract that I coded them to deal flat bonus damage: for example, the eltex lance will deal 15 damage that isn't multiplied by psysensitivity of either wielder or target.

-Elseud