And They’re Off! FDA Wastes No Time in Implementing its New Compounding Authority

Horse RaceIt appears that FDA, like many of us, anticipated the passage of the Drug Quality and Security Act (DQSA) (H.R. 3204).  We previously blogged about Title II of the DQSA here, which focused on drug supply chain security.  Title I, the Compounding Quality Act, clarifies and expands FDA’s authority over pharmacy compounding.  FDA wasted no time in celebrating the DQSA’s passage and on December 2, only one business day after the DQSA was signed into law, the agency announced the release of three guidance documents to explain how it would implement the new legislation.  FDA also published three other notices requesting comment regarding various lists of substances that may or may not be compounded.

FDA stated repeatedly over the past year that it needed additional authority to regulate compounding.   We've chronicled that activity in prior blog posts here, here and here.  FDA got what it wanted, to an extent.   Title I of the DQSA does two things.  First, it amends the current law governing traditional compounding, section 503A of the Food, Drug and Cosmetic Act (FDC Act), 21 U.S.C. § 353a, to delete an unconstitutional provision.  Second, the DQSA adds new section 503B to the FDC Act, 21 U.S.C. § 353b, to create a new regulatory classification for “outsourcing facilities,” which are to be overseen by FDA.

Traditional Compounding

It was necessary for Congress to remove a provision in section 503A prohibiting advertising of compounding services that was added to the FDC Act in the Food and Drug Administration Modernization Act of 1997 (FDAMA).  The U.S. Supreme Court held the advertising restrictions were unconstitutional in Thompson v. Western States Med. Ctr., 535 U.S. 357 (2002) and FDA found its authority to regulate compounders undermined by subsequent lower court decisions which split over whether 503A was unconstitutional in its entirety or in part.  The DQSA clarifies this issue by eliminating the controversial advertising prohibition in 21 U.S.C. § 353a(c) and renumbering the remaining provisions.

Section 503A otherwise remains unchanged, and continues to set out the requirements for traditional compounding created in FDAMA - the pharmacist must compound the drug for individual patients based on a valid prescription, using bulk drug substances or ingredients that comply with USP or other specified monographs.  In addition, a traditional compounding pharmacy may not compound a drug that appears on a list published by FDA in the Federal Register.  One of the FDA guidance documents addresses traditional compounding, and is clear that traditional compounding will generally remain under state oversight as long as the compounding facility meets the requirements of 503A.  A facility that meets the 503A requirements is exempt from cGMP requirements, adequate directions for use, and new drug approval requirements.

Outsourcing Facilities

The new part, 503B of the FDC Act, 21 U.S.C. §353b, creates “outsourcing facilities” and sets out the requirements for their operation.  Although technically voluntary, a compounder has only one of two options:  if it does not compound pursuant to 503A for individual patients based on prescription (or a prescription history of an individual or order history of a physician), then the compounder must register as an “outsourcing facility” under 503B.  An outsourcing facility is exempt from FDA approval requirements and adequate directions for use, but is subject to cGMP requirements.  FDA issued two guidance documents focusing on outsourcing facility registration and reporting.  The registration process is similar to the registration of drug facilities.

FDA, indicating that it is ready to enforce 503A and 503B, states that it “encourages companies wishing to compound as outsourcing facilities to register with FDA immediately.”  Those creating facility reports need to be familiar with Microsoft Excel – the guidance provides a list of required reporting information and directs firms to submit the data in “an excel spreadsheet” to a specified FDA email address.

Compounded Substances Lists and State MOUs

Sections 503A and 503B both require FDA to develop lists of drugs that may or may not be compounded and lists of bulk drug substances that may be used to compound.  To develop these lists, FDA issued the following in the Federal Register and comments are due on or before March 4, 2014:

  • Bulk Drug 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; Request for Nominations, available here.
  • Drug Products That Present Demonstrable Difficulties for Compounding Under Sections 503A and 503B of the Federal Food, Drug, and Cosmetic Act; Request for Nominations, available here.
  • List of Bulk Drug Substances That May Be Used in Pharmacy Compounding; Bulk Drug Substances That May Be Used to Compound Drug Products in Accordance With Section 503A of the Federal Food, Drug, and Cosmetic Act; Request for Nominations, available here.

This nomination process raises interesting questions regarding how FDA would use these lists in the face of its traditional stance that the agency does not regulate the traditional practices of medicine or pharmacy.  In announcing the guidance, FDA noted that it “anticipates that state boards of pharmacy will continue their oversight and regulation of the practice of pharmacy, including traditional pharmacy compounding.”  On some levels, the listing process and the FDA assertions that the practice of pharmacy is a state regulatory matter appear to be at cross purposes.

FDA has maintained a list of drugs in 21 C.F.R. § 216.24 that may not be compounded because the drugs were withdrawn from the market for reasons of safety or effectiveness.  FDA intends to update this list and is accepting comments on drugs that should be included.

Lastly, the DQSA provides that a firm in a state that does not have a Memorandum of Understanding (MOU) with FDA may not compound drugs under 503A unless it meets various exceptions.  To expedite the MOU process FDA is developing a standard form, which will be published for comment.

The FDA’s guidance on DQSA implementation, albeit short, was published very quickly and has resolved many initial questions with more still to come.  Stakeholders will want to pay close attention and not miss the opportunity to comment.

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