The U.S. Food and Drug Administration (FDA) has released five new draft documents related to drug compounding and repackaging by “outsourcing facilities,” state-licensed pharmacies, federal facilities and other healthcare entities. These documents are the latest in a series of policy guidance, including the documents released in July 2014 and December 2014, issued as part of the FDA’s continued implementation of the Drug Quality and Security Act (DQSA), which was enacted in November 2013 in response to a deadly fungal meningitis outbreak linked to contaminated sterile compounded drug products. These new draft documents address topics that have caused uncertainty in the compounding industry since enactment of the DQSA, including outsourcing facility registration; outsourcing facility adverse event reporting; drug repackaging; mixing, diluting and repackaging of biological products; and the Memorandum of Understanding (MOU) addressing the so-called “5% Rule” regarding limitations on the distribution of “inordinate amounts” of compounded drug products interstate.

The documents, all of which were released on February 13, 2015, include the following:

  1. Draft Guidance for Entities Considering Whether to Register as Outsourcing Facilities, which provides information regarding the regulatory impact of registering as an outsourcing facility under Section 503B of the Federal Food, Drug, and Cosmetic Act (FFDCA), including recommendations as to whether certain entities should or should not register as outsourcing facilities. For example, this Draft Guidance states that a facility engaged in only certain activities, including repackaging human drugs and compounding non-sterile drugs, should not register as an outsourcing facility because its drug products will not qualify for the exemptions provided in Section 503B of the FFDCA, including exemptions from new drug approval requirements.
  2. Draft Guidance on Repackaging of Certain Human Drug Products by Pharmacies and Outsourcing Facilities, which describes the conditions under which the FDA does not intend to take action when state-licensed pharmacies, federal facilities or outsourcing facilities repackage certain drug products. It is important to remember that the DQSA does not directly address repackaged drug products and that the FFDCA’s compounding provisions do not provide explicit exemption for repackaged products. Consequently, the FDA attempts to clarify this area with this Draft Guidance.
  3. Draft Guidance on Mixing, Diluting, or Repackaging Biological Products Outside the Scope of an Approved Biologics License Application (BLA), which describes the conditions under which the FDA does not intend to take action for violations of certain sections of the Public Health Service Act and the FFDCA when state-licensed pharmacies, federal facilities or outsourcing facilities mix, dilute or repackage specific biological products without an approved BLA, or when such facilities or physicians prepare prescription sets of allergenic extracts (used to treat allergies) without an approved BLA.
  4. Draft Guidance on Adverse Event Reporting for Outsourcing Facilities, which addresses the FDA adverse event reporting requirements for entities registered as outsourcing facilities under Section 503B of the FFDCA.
  5. Draft MOU Between a State and the FDA Addressing Certain Distributions of Compounded Drug Products, which relates to limitations outlined in Section 503A of the FFDCA on the amount of compounded drug product that can be shipped interstate (e.g., by a mail order pharmacy) unless the state where the facility is located has executed a MOU with the FDA addressing the distribution of these compounded drug products. As discussed previously, the DQSA settled constitutional uncertainty that had previously delayed the FDA’s promulgation of a draft MOU template, as required under the Food and Drug Modernization Act of 1997.

The Draft Guidance documents above are available for public comment for 90 days. The public has 120 days to comment on the draft MOU between the FDA and the states.

In addition to releasing the documents above, the FDA also conducted a Stakeholder Call on February 13, 2015, during which FDA representatives provided an overview of the documents’ contents and answered stakeholders’ questions regarding the documents and the DQSA. A recording of the Stakeholder call is available by calling 1.800.947.5189.

More in-depth analyses of these policy documents and their impact on the compounding industry will be provided in future issues of the Health Law Update newsletter and blog.

If you have any questions about this alert, please contact Lee H. Rosebush at or 202.861.1567 or Cory J. Fox at or 713.646.1358.