Pink Sheet is part of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC’s registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

This copy is for your personal, non-commercial use. For high-quality copies or electronic reprints for distribution to colleagues or customers, please call +44 (0) 20 3377 3183

Printed By



Executive Summary

FDA is drafting a policy guidance on pharmacy compounding to delineate between legitimate compounding and the manufacture of unapproved new drug products. In a series of recent warning letters, FDA has indicated that pharmacies overstep traditional compounding practice when they do the following: (1) contract with a third party to provide pharmacy-prepared products; (2) promote or advertise availability of a class of compounded drug products; (3) prepare products readily available commercially; and (4) prepare multiple regimens of compounded products in advance of receiving prescription orders from prescribers. FDA has asked the National Association of Boards of Pharmacy for help in developing a policy guide to distinguish compounding from manufacturing. NABP has drafted definitions of the two terms and met with FDA last October to discuss them. According to a Nov. 5 memorandum, NABP Executive Director Carmen Catizone said the Oct. 17-18 meeting with FDA produced "a mutually satisfactory understanding of our respective positions." The NABP memo states that "compounding" refers to "the preparation, mixing, assembling, packaging or labeling of a drug or device (1) as the result of a practitioner's prescription order or initiative based on the pharmacist/patient prescriber relationship in the course of professional practice, or (2) for the purpose of, or as an incident to, research, teaching or chemical analysis and not for sale or dispensing." Compounding can also include some pre-arranged orders or patterns of orders, NABP indicated. The memo says the "preparation of drugs or devices in anticipation of prescription drug orders based on routine, regularly observed prescribing patterns" would also be considered legitimate compounding. Similarly, the American Society of Hospital Pharmacists adopted a policy last year which states that hospital pharmacists may prepare drug products in advance of prescription orders. In a resolution adopted at its annual meeting last June, ASHP agreed that compounding "to meet anticipatory patient needs is part of the practice of pharmacy and is not manufacturing." Manufacturing, NABP said, is "the production, preparation, propagation, conversion or processing of a drug or device, either directly or indirectly, by extraction from substances from natural origin or independently by means of chemical or biological synthesis, and includes any packaging or repackaging of the substances or labeling or relabeling of its container, and the promotion and marketing of the same." The association said "manufacturing also includes the preparation and promotion of commercially available products from bulk compounds, and the preparation of drugs or devices for resale by pharmacies, practitioners or other persons." Other factors may determine whether a pharmacist's activity constitutes compounding or manufacturing, NABP continued. For example, whether there are commercial products available also helps determine the nature of a pharmacist's activities as compounding or manufacturing. If a pharmacist prepares products that are already commercially available and doing so "for economic interests only ...without the direction or knowledge of the prescriber," and if the pharmacist is "promoting such products and initiating their authorization," such activities "will be considered manufacturing," NABP said. Other determinants of pharmacist manufacturing include promotion of compounded products; compounding "to such an extent that such activities are significantly different" from normal pharmacy practice; preparation of products outside "regularly observed prescribing patterns" or the normal pharmacist-patient-prescriber relationship; and if "stability, sterility and storage standards" are not met. A spokesperson for the NABP suggested that state boards are likely to use definitions recently developed by the Florida Pharmacy Board as models in the compounding/manufacturing decision. The Florida definitions were developed after a full hearing and amendment process. The Florida board's definition of compounding includes preparation of drugs "not commercially available" pursuant to a prescription order or "in anticipation of prescriptions based on routine, regularly observed prescribing patterns." The board defined "commercially available products" as medicines "legally distributed" in the state "by a drug manufacturer or wholesaler." The board said compounding also includes "preparation of commercially available products from bulk when the prescribing practitioner has prescribed the compounded product on a per- prescription basis and the patient has been made aware that the compounded product will be prepared by the pharmacist." However, preparation of commercially available drugs "for sale to pharmacies, practitioners or entities for purposes of dispensing or distribution is not compounding," Florida added. Other national pharmacy associations are involved in the issue. In a Feb. 6 letter to NABP, NARD and its affiliated National Home Infusion Association suggested that pharmacists should not be limited to compounding products not commercially available. Under such a restriction, preparing solutions at strengths not commercially available is compounding but preparing the same solutions at strengths commercially available constitutes manufacturing, NARD/NHIA noted. "This approach arbitrarily diminishes the pharmacist's professional practice," the letter contends. "Pharmacists should be allowed to compound any strength of a product in the course of their professional practice." NARD passed a resolution at its annual meeting last October asserting that compounding is "an inherent part of" pharmacy. The policy called for NARD to work with the National Association of Boards of Pharmacy to define the term "compounding" more clearly. The American Pharmaceutical Association, in anticipation of its annual meeting in March, has proposed a resolution stating that compounding prescription drugs "pursuant to or in anticipation of" receiving a prescription order "is an essential part of" pharmacy practice. In background information provided by APhA for its proposed compounding policy, the association asserted that "challenges to pharmacist compounding" have been generated by "pharmaceutical manufacturers, as exemplified by" Upjohn in regards to the compounding of minoxidil tablets into topical solutions. "Upjohn maintains that the FDA regulatory scheme is separate and distinct from the patent laws," APhA noted. "Thus, one can comply with the FDA laws and yet infringe on another's patent." Upjohn considers each case of pharmacy compounding of topical minoxidil for treating hair loss to be an infringement of the Rogaine patent -- regardless of whether a pharmacist-compounded solution is prepared before or after receiving a prescription order and irrespective of the amounts prepared. APhA's Professional Affairs Policy Committee, which drafted the proposed resolution, advised the association's board to appoint a working group to develop recommendations on seven related issues: who should define "compounding," distinguishing compounding from manufacturing, "anticipatory compounding," ensuring competency to compound, "inappropriate uses," the role of regulatory agencies such as FDA and the Nuclear Regulatory Commission and "challenges to the right to compound." ASHP policy calls for "ASHP to develop pharmacy practice standards" and "to foster educational efforts" regarding "anticipatory compounding in organized health care settings." The Pharmaceutical Manufacturers Association has not developed a formal industry position on NABP's draft definitions. However, PMA offered in a Jan. 13 letter to FDA to help the agency develop "clear and firm policy guidance in this area to facilitate field investigation personnel taking necessary enforcement actions to protect the public health in cases where unlawful manufacturing of unapproved new drugs is taking place."

You may also be interested in...

Part D Discount Liability Coming Into Focus: CMS Releases Drug Cost Data

Newly released Medicare Part D data sheds light on the sales hit that branded pharmaceutical manufacturers will face when the coverage gap discount program gets under way in 2011

FDA Skin Infections Guidance Spurs Debate On Endpoint Relevance

FDA appears headed for a showdown with clinicians and the pharmaceutical industry over the proposed new clinical trial endpoints for acute bacterial skin and skin structure infections, the guidance's approach for justifying a non-inferiority margin and proposed changes in the types of patients that should be enrolled in trials

Shire Hopes To Sow Future Deals With $50M Venture Fund

Specialty drug maker Shire has quietly begun scouting deals with a brand-new $50 million venture fund, the latest of several in-house investment arms to launch with their parent company's pipelines, not profits, as the measure of their worth




Ask The Analyst

Ask the Analyst is free for subscribers.  Submit your question and one of our analysts will be in touch.

Your question has been successfully sent to the email address below and we will get back as soon as possible. my@email.address.

All fields are required.

Please make sure all fields are completed.

Please make sure you have filled out all fields

Please make sure you have filled out all fields

Please enter a valid e-mail address

Please enter a valid Phone Number

Ask your question to our analysts