FDA Issues New Drug Compounding and Outsourcing Facility Guidance - The New Policy Documents Clarify FDA's Expectations and Enable the Compounding Industry to Comply with the Compounding Quality Act

by Holland & Knight LLP


  • The FDA issued multiple policy documents on July 1, 2014, to implement the Compounding Quality Act (CQA). Congress enacted the CQA in November 2013 as part of the Drug Quality and Security Act (DQSA), in response to the deadly fungal meningitis outbreak that took place in late 2012.
  • The guidance applies to individual and pharmacy compounders subject to section 503A of the Food, Drug, and Cosmetic Act (FD&C) and to outsourcing facilities governed by section 503B of the FD&C.

The U.S. Food and Drug Administration (FDA) issued multiple policy documents on July 1, 2014, to implement the Compounding Quality Act (CQA), which Congress enacted in November 2013, as part of the Drug Quality and Security Act (DQSA), in response to the deadly fungal meningitis outbreak that took place in late 2012. The guidance applies to individual and pharmacy compounders subject to section 503A of the Food, Drug, and Cosmetic Act (FD&C) and to outsourcing facilities governed by section 503B of the FD&C.

These policy documents aim to clarify FDA's expectations and enable the compounding industry to comply with the CQA. Specifically, FDA policy documents include:

  • A Final Guidance for 503A Compounders
  • A Draft Interim Guidance for 503B Outsourcing Facilities
  • A Proposed Rule Revising the List of Drug Products That May Not Be Compounded
  • Two Federal Register Notices Reopening the Nomination Process for Lists of APIs That May Be Used to Compound Drug Products Under Section 503A and 503B

Final Guidance for 503A Compounders1

The Final Guidance restates the requirements of section 503A of the FD&C and clarifies FDA's interim policies pending the implementation of final regulations. Under section 503A, licensed pharmacists or physicians that satisfy certain compounding requirements can qualify for an exemption from complying with certain "manufacturing" requirements, including current good manufacturing practice (cGMP) standards, certain labeling obligations and the standard drug approval process. In its final guidance, FDA addresses multiple issues relevant to 503A compounders, including:

  • FDA expects 503A compounders to comply with the current list of drug products that cannot be compounded because they have been withdrawn or removed from the market due to safety or efficacy concerns.
  • Until FDA publishes a list of bulk drug substances that can be used for compounding in the Federal Register (some of which can be utilized in compounding even in the absence of an applicable United States Pharmacopoeia (USP) or National Formulary (NF) monograph), 503A compounders must use only bulk drug substances that have a USP or NF monograph or are components of approved drugs.
  • FDA will not yet enforce the FD&C provisions excluding compounded drug products from qualifying for the 503A exemptions if the drug product is on a list of drug products that present demonstrable difficulties for compounding that reasonably demonstrate an adverse effect on the safety or effectiveness of that drug product.
  • FDA will not enforce the 5 percent cap on the distribution of compounded drug products outside of a 503A compounder's state until FDA finalizes a formal memorandum of understanding (MOU) with the states and allows time for the states' consideration and execution of the MOU.

In addition, FDA announced its intent to utilize a risk-based enforcement approach for compounded drugs, prioritizing those drugs that present the greatest threats to public health. However, FDA cautioned that it reserves the right to not identify a particular safety problem prior to initiating enforcement activity. FDA identified a non-exhaustive list of potential FD&C violations that it may enforce and focused on potential problems with sterility, strength, quality, purity and similar cGMP issues, as well as labeling, advertising and promotion. In regards to enforcement mechanisms, FDA noted options such as warning letters, product seizures, injunctions, or criminal prosecution for FD&C violations by compounders.

Draft Interim Guidance for 503B Outsourcing Facilities2

The CQA grants FDA stronger regulatory authority with regard to outsourcing facilities that are engaged in the compounding of sterile drugs for hospitals and providers. In this interim guidance, FDA detailed its expectations for cGMPs at outsourcing facilities, which reflect FDA's position that compounding outsourcing facilities require different cGMPs than conventional drug manufacturers. In brief, the interim guidance addresses the following:

  • Facility Design: standards for air filtration, air quality and processing/controlled areas
  • Control Systems and Procedures for Maintaining Suitable Facilities: sanitation procedures (e.g., cleaning methods, schedules, equipment and materials to be used)
  • Environmental and Personnel Monitoring: systems for monitoring environmental conditions in processing areas as well as personal sanitation practices and gowning
  • Equipment, Containers and Closures: requirements for equipment, containers and closures that come into contact with a drug product
  • Components: controls over the source and quality of components, including particular detail regarding testing for non-sterile starting materials
  • Production and Process Controls: written procedures ensuring identity, strength, quality and purity of drug products, as well as relevant sanitation training
  • Release Testing: drug products must satisfy final product specifications before their release for distribution
  • Lab Controls: laboratory controls to ensure the quality of sterile drug products
  • Stability/Expiration Dating: stability program to assess the stability characteristics of finished drug products and to determine appropriate storage conditions and expiration dates
  • Packaging and Labels: packaging system requirements to ensure product integrity
  • Quality Assurance Activities/Complaint Handling: independent quality control and individuals designated to handle failure investigations, adverse reactions, and written and oral complaints concerning the drug product quality

Proposed Rule Revising the List of Drug Products That May Not Be Compounded3

In a proposed rule, FDA seeks to amend the list of drug products that may not be compounded. These drug products or components have been withdrawn or removed from the market because they have been found to be unsafe or ineffective. FDA proposed two primary changes. First, FDA aims to broaden the application of the list by proposing that it apply to both 503A compounding pharmacies and 503B outsourcing facilities. Second, FDA proposes adding 25 drug products to the list and amending one drug product already on the list.

Two Federal Register Notices Reopening the Nomination Process for Lists of APIs That May Be Used to Compound Drug Products4

In an effort to compile two lists of bulk drug substances (active pharmaceutical ingredients or APIs) that may be used to compound drug products in accordance with sections 503A and 503B, FDA has reopened the nomination process for eligible APIs. FDA proposed that, in evaluating nominations and determining which substances are appropriate for use in compounded drug products under section 503A, it will examine the following four criteria:

  1. physical and chemical characterization of the substance
  2. safety issues associated with the compounded drug products
  3. historical use of the substance in compounded drug products
  4. evidence of a compounded drug product's efficacy (if available)

Many previously nominated bulk drug substances were not adequately supported, so FDA was unable to sufficiently evaluate the substance's inclusion on the lists. Accordingly, bulk substances that were previously nominated will not be considered further, unless they are re-nominated and adequately supported.

FDA encourages nominating bulk drug substances utilizing a chart to ensure that all of the following information is provided:

  • confirmation that the bulk substance is not already eligible for compounding
  • background information about the bulk drug substance
  • explanation of clinical need to utilize the bulk drug substance for compounding
  • details about the drug product for which the bulk drug substance will be compounded

Next Steps for the Compounding Industry

These policy guidance documents represent FDA's expected next step in regulating the drug compounding industry. If organizations involved in the compounding industry are interested in participating in the regulatory process before FDA finalizes this guidance, most of these policy documents remain open to public comment. Both the draft interim guidance for 503B outsourcing facilities and the proposed rule revising the list of drug products that may not be compounded are open to public comment for 60 days. In addition, the nominations for bulk drugs substances for compounding under both 503A and 503B are open to additional nominations and comments for 90 days.

1 U.S. Dep't of Health & Human Servs., Food & Drug Admin., Ctr. for Drug Evaluation & Research; Final Guidance: Pharmacy Compounding of Human Drug Products Under Section 503A of the Federal Food, Drug, and Cosmetic Act (July 2014)

2 U.S. Dep't of Health & Human Servs., Food & Drug Admin., Ctr. for Drug Evaluation & Research; Draft Guidance: Guidance for Industry, Current Good Manufacturing-Interim Guidance for Human Drug Compounding Outsourcing Facilities Under Section 503B of the FD&C Act, (July 2014).

3 Additions and Modifications to the List of Drug Products That Have Been Withdrawn or Removed From the Market for Reasons of Safety or Effectiveness, 79 Fed. Reg. 37687 (proposed July 2, 2014)

4 Drug Bulk Substances That May be Used to Compound Drug Products in Accordance With Section 503A of the Federal Food, Drug, and Cosmetic Act; Revised Request for Nominations Notice, 79 Fed. Reg. 37747 (July 2, 2014); Drug Bulk Substances That May be Used to Compound Drug Products in Accordance With Section 503B of the Federal Food, Drug, and Cosmetic Act, Concerning Outsourcing Facilities; Revised Request for Nominations Notice, 79 Fed. Reg. 37750 (July 2, 2014).


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

© Holland & Knight LLP | Attorney Advertising

Written by:

Holland & Knight LLP

Holland & Knight LLP on:

Readers' Choice 2017
Reporters on Deadline

"My best business intelligence, in one easy email…"

Your first step to building a free, personalized, morning email brief covering pertinent authors and topics on JD Supra:
Sign up using*

Already signed up? Log in here

*By using the service, you signify your acceptance of JD Supra's Privacy Policy.
Custom Email Digest
Privacy Policy (Updated: October 8, 2015):

JD Supra provides users with access to its legal industry publishing services (the "Service") through its website (the "Website") as well as through other sources. Our policies with regard to data collection and use of personal information of users of the Service, regardless of the manner in which users access the Service, and visitors to the Website are set forth in this statement ("Policy"). By using the Service, you signify your acceptance of this Policy.

Information Collection and Use by JD Supra

JD Supra collects users' names, companies, titles, e-mail address and industry. JD Supra also tracks the pages that users visit, logs IP addresses and aggregates non-personally identifiable user data and browser type. This data is gathered using cookies and other technologies.

The information and data collected is used to authenticate users and to send notifications relating to the Service, including email alerts to which users have subscribed; to manage the Service and Website, to improve the Service and to customize the user's experience. This information is also provided to the authors of the content to give them insight into their readership and help them to improve their content, so that it is most useful for our users.

JD Supra does not sell, rent or otherwise provide your details to third parties, other than to the authors of the content on JD Supra.

If you prefer not to enable cookies, you may change your browser settings to disable cookies; however, please note that rejecting cookies while visiting the Website may result in certain parts of the Website not operating correctly or as efficiently as if cookies were allowed.

Email Choice/Opt-out

Users who opt in to receive emails may choose to no longer receive e-mail updates and newsletters by selecting the "opt-out of future email" option in the email they receive from JD Supra or in their JD Supra account management screen.


JD Supra takes reasonable precautions to insure that user information is kept private. We restrict access to user information to those individuals who reasonably need access to perform their job functions, such as our third party email service, customer service personnel and technical staff. However, please note that no method of transmitting or storing data is completely secure and we cannot guarantee the security of user information. Unauthorized entry or use, hardware or software failure, and other factors may compromise the security of user information at any time.

If you have reason to believe that your interaction with us is no longer secure, you must immediately notify us of the problem by contacting us at info@jdsupra.com. In the unlikely event that we believe that the security of your user information in our possession or control may have been compromised, we may seek to notify you of that development and, if so, will endeavor to do so as promptly as practicable under the circumstances.

Sharing and Disclosure of Information JD Supra Collects

Except as otherwise described in this privacy statement, JD Supra will not disclose personal information to any third party unless we believe that disclosure is necessary to: (1) comply with applicable laws; (2) respond to governmental inquiries or requests; (3) comply with valid legal process; (4) protect the rights, privacy, safety or property of JD Supra, users of the Service, Website visitors or the public; (5) permit us to pursue available remedies or limit the damages that we may sustain; and (6) enforce our Terms & Conditions of Use.

In the event there is a change in the corporate structure of JD Supra such as, but not limited to, merger, consolidation, sale, liquidation or transfer of substantial assets, JD Supra may, in its sole discretion, transfer, sell or assign information collected on and through the Service to one or more affiliated or unaffiliated third parties.

Links to Other Websites

This Website and the Service may contain links to other websites. The operator of such other websites may collect information about you, including through cookies or other technologies. If you are using the Service through the Website and link to another site, you will leave the Website and this Policy will not apply to your use of and activity on those other sites. We encourage you to read the legal notices posted on those sites, including their privacy policies. We shall have no responsibility or liability for your visitation to, and the data collection and use practices of, such other sites. This Policy applies solely to the information collected in connection with your use of this Website and does not apply to any practices conducted offline or in connection with any other websites.

Changes in Our Privacy Policy

We reserve the right to change this Policy at any time. Please refer to the date at the top of this page to determine when this Policy was last revised. Any changes to our privacy policy will become effective upon posting of the revised policy on the Website. By continuing to use the Service or Website following such changes, you will be deemed to have agreed to such changes. If you do not agree with the terms of this Policy, as it may be amended from time to time, in whole or part, please do not continue using the Service or the Website.

Contacting JD Supra

If you have any questions about this privacy statement, the practices of this site, your dealings with this Web site, or if you would like to change any of the information you have provided to us, please contact us at: info@jdsupra.com.

- hide
*With LinkedIn, you don't need to create a separate login to manage your free JD Supra account, and we can make suggestions based on your needs and interests. We will not post anything on LinkedIn in your name. Or, sign up using your email address.