Big Year Ahead for Implementation of Federal Drug Compounding Law

FDA focusing on steps to ensure patient health and safety

Big Year Ahead for Implementation of Federal Drug Compounding Law

The Food and Drug Administration recently outlined its priorities for implementing and enforcing the law passed by Congress in 2013 to ensure that compounded medications taken by Americans are safe.

Five years after enactment of the Drug Quality and Security Act (DQSA) in response to a catastrophic fungal meningitis outbreak caused by contaminated compounded medications, illnesses and deaths linked to contaminated drugs continue to occur. The FDA regulates compounded drugs—medications for patients with clinical needs that cannot be met by commercially available products—differently from new drugs that pharmaceutical companies want to bring to the market.

Now the FDA appears poised to act in ways that will have a real impact for patients.

Tailoring standards to size and scope

To ensure safety, compounded drugs must be free of harmful contamination and include the correct ingredients in the right amounts. To meet these criteria, compounders must follow appropriate quality standards for how drugs are made, stored, and handled.

Compounding for a single patient is a traditional part of pharmacy practice, but the practice has evolved over time. Today some compounders do not dispense drugs to individual patients but instead make stock supplies of drugs, which present greater risks because of their typically longer shelf life and larger batch sizes. The DQSA allows such “office stock” to be produced by compounding companies that register as “outsourcing facilities” if they meet quality standards—called Current Good Manufacturing Practices (CGMP)—like those that apply to conventional drug manufacturers. 

The FDA’s cGMP standards are already flexible, but the 2018 plan says the agency will issue policies describing how those standards can be tailored to the size and scope of an outsourcing facility’s operations. Patients will have improved access to safe compounded products if the forthcoming policies are scientifically appropriate and help more facilities register as outsourcing facilities and adopt cGMP. However, hospitals and other providers need reliable sources for sterile office stock, so any flexibility in CGMP must not compromise the standard’s stringent nature.

Protecting the FDA approval process

Before selling a new medicine, pharmaceutical companies must submit data from clinical trials and other testing to the FDA to establish that the drug works and that its benefits outweigh its risks. Because compounded drugs do not go through this process, they can expose patients to unknown harm.

The DQSA includes provisions that limit and in some cases prevent outsourcing facilities and other compounders from selling compounded copies of FDA-approved products. When it released the plan, the agency finalized guidance documents on how it will interpret and enforce these restrictions. This is an important step, because allowing compounding businesses to freely copy approved drugs would reduce the incentive for pharmaceutical companies to conduct the testing needed for FDA approval.

The plan also describes additional documents that will affect which ingredients may be used in compounded drugs. Federal law already includes criteria for which active drug ingredients—known as bulk drug substances—can be used. This year, the agency will issue a final rule on 10 bulk drug substances that have been evaluated to determine whether they can be used to compound drugs by entities not registered as outsourcing facilities. It also will continue to evaluate other bulk drug substances that compounders want to use.

In March, the FDA issued draft guidance proposing criteria for determining whether there is a clinical need to compound from a particular bulk drug substance; the agency is now seeking comments on that draft. In general, outsourcing facilities can compound using a bulk drug substance only when the FDA has determined that there is a clinical need to use it, rather than starting with an FDA-approved drug.

Properly enforced, these guidance documents and regulations should help ensure that patients do not receive compounded products when an FDA-approved medication is available to meet their needs.

Mitigating risks of state-to-state distribution

The FDA plan also includes efforts to ensure effective oversight of compounded drugs across state lines. Such interstate distribution can range from a compounder at a state border dispensing to the local community, to businesses that sell products nationwide.

As an example of the latter, some patients with problems eating and digesting food may require intravenous administration of liquid nutrition tailored to their individual dietary needs. Specialized compounders that may be located far from the patient often prepare these infusions. Some other compounders advertise a variety of products online and receive orders from around the country. To address the concern that patients everywhere can be put at risk if any state has ineffective oversight, the DQSA allows states to enter into memorandums of understanding (MOU) with the FDA committing to certain oversight functions. Doing so allows pharmacies in those states to distribute a larger percentage of their products across state lines than pharmacies in states that do not agree to the MOU. Traditional compounders in states without the agreement can distribute no more than 5 percent of their products out of state.

Compounders in MOU states may exceed that limit, up to a point: They may not engage in “inordinate distribution,” but that threshold has been in flux. Draft memorandums have indicated that 20 or 30 percent might be the limit, but the FDA’s 2018 plan says a revised draft will allow compounders to distribute up to 50 percent of their product beyond their home state before those sales would be considered inordinate. Unlike prior drafts of the MOU, the new MOU described in the FDA’s 2018 plan would not prohibit pharmacies from exceeding the 50 percent limit.  Instead, pharmacies that ship most of their product interstate would face additional reporting requirements. These rules would allow the FDA to focus on pharmacies that more frequently sell their products across state lines as it conducts oversight activities.

It is unclear, however, whether states have the mechanisms in place to know when pharmacies exceed the 50 percent threshold, whether the FDA would be equipped to properly oversee such pharmacies, and how effectively the agency could intervene if necessary. These issues will need to be addressed to help ensure the safety of patients receiving compounded drugs from out of state.

An encouraging set of principles

The proposed regulations cannot be fully evaluated until they are issued. But the plan emphasizes that the compounding program remains a priority and that the FDA is committed to implementing the DQSA framework.

The plan sets out important principles, such as the need to balance patient access to necessary compounded drugs with protection from poor-quality drugs that could cause harm. It also emphasizes the importance of ensuring that compounding does not undermine new drug approval requirements. If the FDA follows these principles, its actions in the coming year will help ensure that patients are taking the safest possible drugs that can meet their clinical needs.

Elizabeth Jungman directs The Pew Charitable Trusts’ work on public health.


Compounded drugs
Compounded drugs
Issue Brief

What Are Compounded Drugs, and How Can They Be Kept Safe?

Drug Quality and Security Act plays key role in important but potentially high-risk aspect of health care

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Issue Brief

Pharmaceutical compounding is the creation of medications for patients whose clinical needs cannot be met by commercially available products approved by the Food and Drug Administration. For example, if a patient who cannot swallow pills needs a liquid version of a medicine that is FDA-approved only in pill form, a compounding pharmacy can make the medication.