Updates on 503A Compounding: Legal and Regulatory Developments

Pharmacy compounding is an important component of pharmacy practice and is essential to the provision of health care. There have been several recent legal and regulatory developments that pertain to 503A pharmacy compounding resulting in both opportunities and challenges.

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Part 1 of this 2-part article series explores USP <797> and <795> revisions for sterile and nonsterile compounding, veterinary compounding, FDA inspections of 503A pharmacies, and the interstate distribution of compounded prescriptions post Wellness Pharmacy v. FDA. Part 2 will review the compounding of drugs on the FDA shortage list, compounding “essentially a copy,” compounding peptides, DTE, semaglutide, β lactams, ibuprofen, and bHRT.

USP <797> and <795>Revisions

On November 1, 2022, the long-awaited revisions to USP <797> for sterile compounding and <795> for non-sterile compounding became official. Implementation and enforcement do not begin until November 2023 and appeals have already been filed regarding the beyond use date (BUD) and batch size provisions.

Despite that, it is important to be proactive and develop best practices because it is unlikely that USP will undertake significant further revisions. Important revisions are listed in Table 1.

Important revisions to USP <797> and <795>

A best practice is to conduct a gap analysis regarding the revised chapters initially and at least annually thereafter, to include the development of a robust environmental monitoring program and policies and procedures reflective of the changes. USP has received many questions regarding stability studies to extend BUDs, including multi-dose non-preserved ophthalmic requirements.

It is important for compounders to recognize that USP chapters are minimal standards and state regulations and FDA guidances, such as the guidance on Insanitary Conditions, may be more stringent.¹ For example, California requires 503As to report adverse drug events.

Veterinary Compounding

In 2022, the FDA issued a final guidance on animal drug compounding from bulk substances that set up a system that was similar to the framework for 503A/503B compounding.² In particular, the guidance establishes criteria for office use compounding of animal drugs using bulk drug substances that appear on the FDA’s bulk drug substances list, as well as compounding patient-specific prescriptions.

The criteria to be included on the bulk drugs list include that there is no human or animal drug that could be used to treat the condition and treatment with a compounded drug is necessary to avoid animal suffering or death. The list includes 25 drugs with the identification of the particular species they may be compounded for.³

The compounding industry has nominated more than 100 additional substances and those may also be compounded while they are under review. The guidance also explains the FDA’s policy on animal drugs compounded from bulk drug substances that are copies (same active ingredient and route of administration) of marketed FDA-approved drugs.

There has been widespread industry pushback on this guidance. The FDA has now indicated it will phase in enforcement and begin with limited pharmacy inspections through September 2023 with opportunities for pharmacies to implement corrective action prior to enforcement.⁴

Compounding drugs not on the bulks list, compounding “essentially a copy” of a commercially available product and compounding for “office use” will be areas of enforcement focus. Note that although the guidance pertains to compounding from bulk substances, compounding animal drugs from FDA-approved, conditionally approved, or indexed drugs is generally permissible under certain conditions.⁵

Interstate Distribution Post Wellness Pharmacy v. FDA

On October 26, 2020, the FDA issued a memorandum of understanding (MOU) describing the conditions under which certain drugs compounded by 503A pharmacies could be shipped interstate. States that signed the MOU would have committed to investigating and reporting to the FDA any time a pharmacy shipped more than 50% of its compounded drugs to out-of-state patients. Pharmacies located in states that did not sign would have been subject to a 5% limit, which would have had a chilling effect on patient access.

In Wellness Pharmacy v. FDA, a number of compounding pharmacies sued the FDA asserting various claims, including bypassing the Notice and Comment provisions of the Administrative Procedures Act.⁶ One contentious issue pertained to the conflating of the terms “distribution” and “dispensing.”

The FDA has now suspended implementation of the MOU until the effective date of a final rule. It is anticipated that the formal process may take years to complete. In the meantime, the FDA has also indicated enforcement discretion regarding the 5% Rule, which is the statutory 5% limit on the distribution of compounded human drug products out of the state in which they are compounded.⁷

503A Pharmacy Inspections

Since the issuance of the first guidance on 503A compounding in 2016, the FDA has increasingly been involved in the activities of 503A compounding pharmacies and has stepped up the number, frequency, and intensity of inspections of 503A compounding pharmacies. An FDA inspection of a 503A compounding pharmacy can last weeks with daily requests for hundreds of documents and reports.

503A pharmacies are not required to adhere to cGMPs when compounding and most states have adopted USP compounding rules. However, instead of applying USP rules, the FDA inspects using its Guidances,^8,9 including a 2020 guidance entitled “Insanitary Conditions at Compounding Facilities.”¹⁰

Pharmacists need to be aware that this guidance has cGMP components outside of the USP requirements. Pharmacists should also be aware of the fact that the state boards of pharmacy cooperate with the FDA and often accompany the FDA on inspections (at least for the first day). Frequently, during an inspection when the FDA identifies strictly board of pharmacy issues, the agency prepares a referral letter to the board.

In a recent inspection, for example, the pharmacy did not have a nonresident pharmacy permit and mailed the compounded prescription to a patient in another state. The FDA notified the state board of pharmacy where that compounded prescription was shipped into.

If the FDA issues a Form 483 list of inspectional observations/deviations, the pharmacy must respond and address the deviations within 15 days. Compounding pharmacies should be FDA inspection-ready and establish a plan to mitigate inspection stress.

The art and science of compounding is a fundamental aspect of pharmacy practice and must be advocated for on behalf of patients and policymakers. Like many other important aspects of pharmacy practice, the legal and regulatory aspects are ever changing and keeping abreast of the changes is challenging.

About the Author

Martha M. Rumore, PharmD, Esq, MS, LLM, FAPhA, is senior counsel at Frier Levitt.

References

1. FDA Guidance for Industry. Insanitary Conditions at Compounding Facilities. Center for Drug Evaluation & Research CDER), Office of Compliance, FDA. Nov. 2020.

2. GFI256. Compounding Animal Drugs from Bulk Drug Substances. Center for Veterinary Medicine, FDA. April 13, 2022.

3. Available at https://www.fda.gov/animal-veterinary/animal-drug-compounding/list-bulk-drug-substances-compounding-office-stock-drugs-use-nonfood-producing-animals.

4. Letter to Industry. Phase-in of Inspectional Activities Related to Compounding of Animal Drugs From Bulk Drug Substances. FDA. March 10, 223.

5. An indexed animal drug is a drug on FDA's Index of Legally Marketed Unapproved New Animal Drugs for Minor Species, referred to simply as “the Index.”

6. Wellness Pharmacy, Inc. v. Becerra (D.D.C. Sep. 21, 2021)).

7. Extension of the Period Before the Food and Drug Administration Intends to Begin Enforcing the Statutory 5 Percent Limit on Out-of-Sate Distribution of Compounded Human Drug Products 87 Fed Reg 63947, Oct 21, 2022.

8. FDA Guidance. Compounded Products That Are Essentially Copies of Commercially Available Drug Products Under Section 503A of the FD&C Act. CDER. FDA. Jan. 2018.

9. FDA Guidance. Policy on Compounding Using Bulk Drug Substances Under Section 503A of the FD&C Act. CDER. FDA. Jan. 2017.

10. FDA Guidance. Insanitary Conditions at Compounding Facilities. CDER. FDA. Nov. 2020.