On April 15, 2016, the Food and Drug Administration (“FDA”) issued three important draft guidance documents that clarify the standards under Sections 503A and 503B of the federal Food Drug & Cosmetic Act (“the Act”) applicable to compounding activities carried out by prescription drug compounders. These compounders include hospital pharmacies, non-hospital pharmacies (including retail pharmacies) and facilities known as “outsourcing facilities” that compound drugs but need not be licensed pharmacies.

At a high level, the draft guidance serves to: (i) detail that valid prescription orders for compounded drugs must clearly list the individual patient, whether or not required by state law, and clearly indicate that a compounded preparation is required; (ii) recommend a clarification regarding permitted anticipatory compounding to provide that hospital or health system pharmacies may compound and distribute any quantity of compounded drug product to related health care facilities within a one-mile radius of the hospital pharmacy, provided such drugs are only  administered to patients within such health care facilities (i.e., no dispensing for self-administration off the premises); (iii) indicate that the FDA intends to further define “limited quantities” for purposes of anticipatory compounding as a 30-day supply  of a particular compounded drug based on historical purchases over the past year; and (iv) clarify that outsourcing facilities may not be co-located with non-outsourcing facility pharmacies that perform traditional pharmacy compounding.

Although issued in draft form, the guidance offers important insight into the FDA’s current thinking on these topics. As a result, we recommend that pharmacies, hospitals, health systems, outsourcing facilities and other interested entities respond to the FDA’s request for comments and suggestions on the draft guidance and either request clarifications, offer support or recommend changes.  These comments must be submitted within 90 days or before July 14, 2016.

Background 

Compounded drug products are created by taking an FDA-approved drug and changing the dosage, administration method and/or composition by combining the drug with additional substances. For example, compounding could include the alteration of a pill into liquid oral form or creating a specialty intravenous therapy for a cancer patient that includes multiple drug therapies. Compounded drug products do not undergo any premarket review for safety, effectiveness or quality and are therefore not approved by the FDA. Furthermore, unlike FDA-approved drugs, drugs compounded by pharmacies are not subject to the FDA’s current good manufacturing practices (“CGMP”) requirements. Drugs compounded by outsourcing facilities, while exempt for other important FDA manufacturing requirements, remain subject to CGMP compliance.

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