Analysis

Why Drug Compounding Is Not a Solution to High Prices

Recent spikes in the price of certain off-patent medications have caused some legislators and health care professionals to advocate for using compounded drugs—drugs mixed by pharmacies—as a substitute for more expensive, FDA-approved medications. Though well-intentioned, this approach carries significant risks for patients and the sustainability of the drug approval system for the following reasons:

  1. It increases risks to patient safety.

    Compounding drugs solely for the purpose of creating low-cost alternatives to FDA-approved products may expose patients to unknown risks. Unlike FDA-approved generic drugs, which are required to demonstrate their equivalence to drugs shown to be safe and effective, compounded drugs are not approved by the Food and Drug Administration. Makers of these products are not required to prove that their drug formulations are absorbed in the body in a predictable, consistent way that is comparable to other products on the market.

    To ensure that manufacturers continue to take their products through the FDA approvals process, federal law prohibits compounders from copying an approved drug unless it is in short supply. This guarantees that each drug given to patients has been demonstrated to be safe and effective.

  2. Reliance on compounding could undermine the generic drug market in the long run.

    While intended to enhance competition in the short run, allowing compounded drugs to be marketed alternatives to FDA-approved products creates a disincentive for companies to take products through the generic drug approval process.

    Compounders’ cost to make a drug is much lower, because they do not have to pay for bioequivalence trials or comply with significant quality standards—important criteria we expect from our drug manufacturers.

  3. Expanding the role of compounding beyond what is carefully prescribed in statute weakens oversight systems.

    Compounded drugs do play an important role in health care: They allow doctors to order specialized medicines for patients whose needs can’t be met by an FDA-approved product (i.e., a child who needs a liquid version of medicine available only in pill form).

    For this reason, federal law gives compounders special exemptions from drug approvals, and Congress has allowed the compounding of variations of approved drugs when it creates a significant difference for a patient.

    But compounding drugs solely for the purpose of creating a low-cost alternative to an FDA-approved product goes well beyond the scope intended for the industry. Drug production outside the careful boundaries established for legitimate compounding should go through the full approvals process.

Any effort to facilitate patient access to essential medicines at sustainable prices must not undermine the importance of the bioequivalence testing and manufacturing quality standards designed to protect both patient safety and drug efficacy. We need to recognize the long-term importance of ensuring that manufacturers continue to take their products through the FDA approval process.

Media Contact

Tami Holzman

Officer, Communications

202.552.2122