Approved Drugs Get Top Billing in FDA’s Compounding Plan

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By Greg Langlois

The FDA’s hope that more bulk drug compounding companies register with the agency could be stymied by its preference for compounders to use agency-approved drugs, one industry group says.

The FDA issued a new draft guidance document explaining how it plans to go about accepting nominations for the “503B Bulks List"—approved bulk drug substances that can be used by large-scale drug compounders. Citing patient safety, the document says drug compounders should use agency-approved drug substances instead of bulk ones whenever possible.

Drug compounding is the practice of combining, mixing, or altering an existing drug’s ingredients to specifically tailor a medication to an individual patient’s needs. Compounders have been under greater scrutiny since 2012, when contaminated drugs from Massachusetts-based New England Compounding Center were linked to a multistate, deadly fungal meningitis outbreak. The outbreak sickened over 750 people and caused 64 deaths in 20 states, according to the Centers for Disease Control and Prevention.

The outbreak illustrated how compounded drugs, without going through the Food and Drug Administration’s premarket review for safety, effectiveness, and quality, “present a greater risk to patients than FDA-approved drugs,” FDA Commissioner Scott Gottlieb said in a statement announcing the draft guidance. The guidance is a part of the agency’s 2018 Compounding Policies Priority Plan released in January.

But while some hailed the move as protecting patients, a bulk drug compounder group said requiring them to use FDA-approved drug substances adds little to patient safety and will likely discourage compounding industry growth.

The International Academy of Compounding Pharmacists has “significant concerns” about the FDA’s approach, IACP Executive President Cynthia Blankenship told Bloomberg Law in a March 26 email. “This policy does not prioritize the best interests of patients, it prioritizes the market share of pharmaceutical manufacturers,” she said.

Compounders wanting to make larger amounts of drugs without individual prescriptions (bulk compounding) can voluntarily register with the FDA as “outsourcing facilities” and become subject to federal manufacturing oversight, with their products exempt from laws regarding new drug applications and labeling. The Drug Quality and Security Act of 2013 (DQSA)—enacted in response to the 2012 outbreak—added Section 503B to the federal food and drug law to create this new category of outsourcing facilities (as opposed to compounding by traditional smaller-scale pharmacies, which is regulated under Section 503A).

Currently, 71 compounders are registered with the FDA as outsourcing facilities, according to an agency registration list. Several, such as Pharm D Solutions, LLC in Houston and Olympia Compounding Pharmacy in Orlando, Fla., have received FDA warning letters. Outsourcing facilities aren’t exempt from current good manufacturing practice requirements.

Safety First

The new draft guidance says outsourcing facilities should use FDA-approved drug products instead of bulk drug substances when possible because "[t]he source, safety, and quality of the starting material are better known and established.”

“The big news here seems to be that the FDA is making a pretty clear statement that outsourcing facilities should not be starting from bulk ingredients where they could be starting from FDA-approved products,” Pew Charitable Trusts director of public health programs Elizabeth Jungman told Bloomberg Law in a March 26 interview.

“You want patients to get the safest products that are clinically appropriate,” and the safest ones are likely to be approved ones, those that have been tested in clinical trials and made in an inspected facility, Jungman said.

“The FDA really makes clear that compounded drugs by outsourcing facilities have greater risk than FDA-approved drugs and should only be used when medical needs can’t be met with an FDA-approved product,” Public Citizen health research group director Michael Carome told Bloomberg Law in a March 26 interview.

“I was encouraged that they are taking an approach that prioritizes public health over the financial interests of outsourcing facilities,” Carome said. “They want to limit exposing patients to products made by these outsourcing facilities that have not been shown to be safe and effective and may be of substandard quality.”

But given that outsourcing companies are subject to facility inspections, adverse events reporting, and other FDA oversight, the agency’s concerns about the sources of pure ingredients—the term IACP uses for bulk substances—don’t ring true, Blankenship said. “Since FDA inspects the pure ingredient manufacturers and the outsourcing facilities to hold them accountable to those standards, we feel the statements in this draft guidance that question the quality of the pure ingredients used by outsourcing facilities vs. those in FDA-approved drugs are false and misleading,” Blankenship said.

Divergent Pharma, Compounder Incentives?

The preference for FDA-approved drugs also promotes safety by encouraging drugmakers to submit new products for approval, the draft guidance says.

The agency doesn’t want to “undermine the current system for drug companies investing in the research and testing in order to obtain FDA approval of products that are shown to be of high quality, safe and effective,” Carome said. “It is the appropriate approach from a public health standpoint.”

“Defaulting to FDA-approved drugs where appropriate preserves that incentive for companies to engage in R&D,” Pew’s Jungman said.

But for outsourcing facilities, "[o]ur general impression is that this draft guidance is a disincentive for anybody to register as a 503B,” IACP’s Blankenship said. “The idea that a manufacturer should only be allowed to create products using a different manufacturer’s finished goods is illogical and does not exist in any other industry that we are aware of, especially considering that both manufacturers operate under oversight of the same federal agency and deliver products to many of the same clients.”

Section 503B allows the FDA to publish its list of bulk drug substances “for which there is a clinical need,” and the agency’s draft guidance interprets that provision. Blankenship argued the agency’s focus on FDA-approved products also butts into treatment plans that should be worked out among patients, doctors, and pharmacists.

IACP wants to work with the FDA on rules that “truly create a viable 503B marketplace and could incentivize more registrants into this budding industry,” she said.

Call for Nominations

Under 503B, the FDA compiled a preliminary “503B Bulks List” of drug substances that outsourcing facilities can use while the agency works to finish its bulk drug compounding policy. The new guidance explains how the FDA will review nominations for the final list.

“There will be many, many nominations,” Hyman, Phelps & McNamara, P.C. Director Karla Palmer told Bloomberg Law in a March 26 email. Palmer’s FDA practice includes advising clients on the DQSA and compounding laws.

The FDA will have to issue final rules, after notice and comment, to add nominated substances to the Bulks List, “and that could take some time,” Palmer said.

The FDA seeks comments on the draft guidance by May 25.

To contact the reporter on this story: Greg Langlois in Washington at

To contact the editor responsible for this story: Randy Kubetin at

For More Information

The draft guidance is available at

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