FDA’s Compounding Oversight: What Price Safety?

As meningitis outbreak widens, FDA and members of Congress are calling for clarification of what jurisdiction the agency has over pharmacies, but agency officials are stopping short of asking for clear new authorities.

The legacy of the meningitis infections linked to fungal contamination of preservative-free methylprednisolone acetate produced and distributed by the New England Compounding Center may be determined to a large degree by the amount of additional authority that FDA is willing to request.

At the moment, FDA notes that unclear lines of authority make it difficult for the agency to regulate compounding pharmacies so as to prevent illicit mass-manufacture of approved drugs under cover of compounding, as the pharmacy implicated in the fungal meningitis outbreak that has killed 14 patients as of Oct. 12 appears to have been doing.

While Congress and FDA itself are calling for the situation to be corrected, the agency has so far stopped short of asking for specific new statutory powers. “There needs to be a risk-based scheme put in place to deal with those issues,” FDA Deputy Commissioner for Global Regulatory Operations and Policy Deborah Autor said at an Oct. 11 press conference.

That kind of general language is understandable at this stage in the incident. Epidemiology work – including efforts to definitively link the infections to the injections – is still ongoing, so the agency’s focus is obviously not on prospective policy changes at this point.

But Autor’s choice of words, expressing desire for a “risk-based scheme,” underscores the challenges that face any new effort to increase FDA’s enforcement power over mass-compounding pharmacies. First, FDA hasn’t been terribly aggressive in testing the limits of the authorities it has now, perhaps because it fears they could crumble entirely if placed under too much legal weight and perhaps because the agency seems to have at least some philosophical sympathy for compounding, which often produces products at much lower prices than the commercial version.

Second, it seems unlikely that any new enforcement powers would be accompanied by a significant increase in funding, meaning that FDA might get new arrows in its legal quiver, but little draw weight on the bow to help them fly (see sidebar).

Finally, any proposals to strengthen FDA’s authorities would have to be enacted through Congress, and similar efforts in the past have faced opposition from Republicans concerned about excess government regulations of commerce and speech.

Still, the amount of public attention to the issue has been considerable, and that always increased momentum. “It is really unfortunate that it takes a crisis to bring this kind of change, but that is often the case,” Autor said.

Hyman & Phelps Director Kurt Karst observed that the infection outbreak comes as FDA is celebrating the 50^th anniversary of the Kefauver-Harris Amendments, which President Kennedy signed on Oct. 10, 1962. The key component of the law required that drugs be shown to be effective, not just safe, before being approved.

“The Kefauver-Harris Amendments forever changed the way new drugs are approved and regulated in the United States,” Karst wrote. “Like many significant changes to the FDC Act, the Kefauver-Harris Amendments were prompted by a tragedy,” in this case the findings of thalidomide’s risks the year before.

Capitol Hill Gets Involved

The first steps toward Congressional consideration seem to be getting underway. Three Democratic members of the House Energy and Commerce Committee – Reps. Henry Waxman (Calif.), Frank Pallone (N.J.) and Diana DeGette (Colo.) – appear to have successfully pressured the majority Republicans to write FDA and CDC asking for a briefing on the fungal meningitis outbreak.

In twin letters sent Oct. 9 to FDA Commissioner Margaret Hamburg and CDC Director Thomas Frieden, Energy and Commerce Committee Chairman Fred Upton (R-Mich.) called for a closed briefing for the committee by Oct. 12 on the outbreak, albeit without specifying in detail what is wanted. “We intend to learn more from the FDA, CDC and others who may provide insight into the details surrounding this outbreak and the prevention of future outbreaks.”

Meanwhile, Rep. Rosa DeLauro (D-Conn.), the ranking member of the Labor, Health, Human Services, and Education Subcommittee of the House Appropriations Committee, wrote HHS Secretary Kathleen Sebelius asking for more information. Both DeLauro and the minority Energy and Commerce members want to know:

• Whether FDA has clear authority over what DeLauro called “non-traditional compounding centers”;
• Whether Medicare and private insurance reimbursement policies are inadvertently encouraging the use of compounded drugs;
• Whether FDA needs additional authority by legislation – DeLauro mentioned the possibility of “requiring the reporting of these adverse events”;
• What actions FDA has taken regarding the outbreak, such as by keeping the public as informed as possible; and
• Details of what the Massachusetts Board of Pharmacy did and of how FDA can “work with State partners to ensure that compounding pharmacies and centers follow safe preparation techniques to minimize the risk of contaminated products entering the marketplace,” in DeLauro’s words.

On the other side of the Capitol, a staffer for freshman Sen. Richard Blumenthal (D-Conn.) said he is “looking at legislative options to address the issue.”

The situation is complex, the staffer said. “There is definitely room for traditional compounding. It has helped with drug shortages at times. We have to determine what the agency thinks its authority is and whether that’s sufficient to protect the safety and quality of the drug supply in the United States.”

Beyond Mortar And Pestle

For now, though, FDA is operating without a clear policy framework. “The world has changed a lot since the days of mortar and pestle, and this is the time for pharmacists, for lawmakers, for regulators and for doctors to sit down to grapple with this new model of pharmacy compounding and come up with a regulatory scheme that appropriately controls the risk,” Autor said.

In an e-mail, FDA said that the current situation is that “the state boards of pharmacy that license pharmacies and pharmacists oversee compounding pharmacies’ day-to-day operations. FDA also has some authority over drugs made by compounding pharmacies. The agency can initiate enforcement action against a compounded drug if it is adulterated or misbranded in certain ways (e.g., if the drug is contaminated or falsely labeled).”

“But the law exempts some pharmacy compounding from certain requirements that are otherwise applicable to drugs manufactured for the United States,” FDA pointed out. “For example, compounded drugs are not approved by the FDA and therefore do not undergo premarket review for safety and effectiveness. When the agency becomes aware of potentially contaminated or otherwise adulterated or misbranded compounded drug products, FDA investigates and works with its state counterparts to take appropriate action as quickly as possible.”

FDA notes there are two conflicting decisions from federal appellate courts on whether the section of the Federal Food, Drug and Cosmetic Act that addresses compounding is valid and enforceable by the agency.

The courts have created uncertainty, the agency further noted. “There are two conflicting decisions from federal appellate courts on whether section 503A [of the Federal Food, Drug, and Cosmetic Act, which deals with compounding] is valid and enforceable by FDA. The agency also has a compliance policy guide describing the agency’s policy on pharmacy compounding.”

As FDA notes in a 1998 guidance, FDCA Section 503A stipulates that under certain conditions, compounded drugs “may be entitled to exemptions from three key provisions of the act: (1) the adulteration provision of section 501(a)(2)(B) (concerning the good manufacturing practice requirements); (2) the misbranding provision of section 502(f)(1) (concerning the labeling of drugs with adequate directions for use); and (3) the new drug provision of section 505 (concerning the approval of drugs under new drug or abbreviated new drug applications).”

The legislation came under challenge in 2001, however, when a federal appellate court ruled that restrictions on advertising of compounded drugs invalidated the section, a ruling that was upheld the following year by the Supreme Court, leaving in question the validity of the section (Also see "Supreme Court Reaffirms Least Restrictive Standard For Ad Controls" - Pink Sheet, 6 May, 2002.). The issue was further clouded in July 2008, when the Fifth U.S. Circuit Court of Appeals confirmed the validity of the drug compounding section (Also see "Compounded Drugs May Return To Supreme Court After 5th Circuit Backs FDAMA" - Pink Sheet, 18 Aug, 2008.).

Warning Letter Cited NECC For Non-Compounding Behavior

That degree of uncertainty has not stopped the agency from taking some enforcement steps, and from emphasizing that it probably wouldn’t take others.

FDA had sent NECC, the pharmacy linked to the current outbreak, a warning letter in 2006 for compounding trypan blue ophthalmic products, which the company claimed were “devices” but FDA said are approved drugs subject to its jurisdiction. The letter said the company may also have been compounding 20% aminolevulinic acid solution, another FDA-approved drug. In 2004, Dusa Pharmaceuticals Inc. sued NECC alleging that the latter compounded product violated Dusa’s patents on Levulan (Also see "Dusa Patent Suit Challenges Compounding Of Levulan" - Pink Sheet, 28 Dec, 2004.). Aminolevulinic acid is not on the complete list of compounded products NECC is recalling.

The warning letter also stated NECC was offering for sale “Extra Strength Triple Anesthetic Cream” containing 20% benzocaine, 6% lidocaine, and 4% tetracaine, which FDA said is not acceptable as pharmacy compounding, and that the agency had received “a complaint alleging that you are repackaging the approved injectable drug, Avastin, into syringes for subsequent promotion and sale to health professionals.”

FDA pointed out in an e-mailed statement that the 2006 warning letter “was not related to the compounding practices at issue today.”

Last year Genentech Inc.’s Avastin (bevacizumab) was at the center of another compounding controversy, with eye infections associated with off-label use of the product, which had been compounded at a Florida pharmacy in microdoses to treat wet age-related macular degeneration and diabetic macular edema (Also see "Avastin-Related Eye Infections Could Bring FDA Pressure On Compounding Pharmacies" - Pink Sheet, 31 Aug, 2011.).The incident provides a hint of what FDA thinks are the limits of its writ with regard to compounding, as the agency’s alert to health care providers suggested the focus of the investigation of the Florida cases was on sterility issues in the repackaging process.

A federal court ruling around the same time also appeared to place limits on the agency’s ability to crack down on compounding violations, although the products at issue were for veterinary use – on Sept. 12, 2011, the U.S. District Court for the Middle District of Florida concluded that FDA does not have per se authority to enjoin the traditional practice of pharmacists filling veterinary prescriptions with drugs compounded from bulk substances (Also see "FDA Guidance Policy Could Be Hurt By Ruling On Animal Drug Compounding" - Pink Sheet, 26 Sep, 2011.).

FDA did receive judicial backing for its position on another compounding controversy, this one relating to compounded versions of the pre-term birth drug Makenaproduced byLumara Health Inc.Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia ruled in September that the agency’s public statements regarding compounded versions of hydoxyprogesterone caproate, or 17-P, are not subject to review in light of a 1985 Supreme Court ruling, Heckler v. Chaney, which held that FDA’s decision not to take enforcement action is within its discretion.

In a Q&A document issued June 29, FDA backed off earlier statements relating to the practice of compounding the drug, saying it may take action against pharmacies and that they should not “exceed the scope of traditional pharmacy compounding.”

In Defense Of Compounding

But legislative changes related to compounding and even specific enforcement efforts against NECC might not go unchallenged. In a statement, the Association of American Physicians and Surgeons decried what it called a “witch-hunt against compounding pharmacies,” charging that “Big Pharma and its allies in Congress and the media dislike the competition provided by compounding pharmacies. Compounding pharmacies sell a progesterone medication to prevent preterm births for only $25, when similar medication costs $1,500 a dose from a big pharmaceutical company.”

On the other hand, Joe Cabaleiro, executive director of the Pharmacy Compounding Accreditation Board, said more clarity is needed. “Taken as a whole, regulation of compounding at the federal level has been an inconsistent patchwork, and has tended to take place on a retrospective basis.” What is needed, he said, is “federal clarification of the difference between compounding and manufacturing.” As a standard-setting organization, the board will take its cue from regulators, he said.

The National Community Pharmacists Association put out a statement defending “traditional pharmacy compounding [which] offers many benefits, including improving health outcomes and lowering medical costs for patients, and is fundamentally different from the now-suspended operation at the New England Compounding Center suspected to be the source of the meningitis outbreak.”

The cost savings for users are impossible to ignore, the statement notes, citing the Makena case, in which the cost differential was $30,000 vs. “$400 or less,” and compounded versions of Hoffmann-La Roche Inc.’s Tamiflu during the 2009 H1N1 influenza outbreak.