Presidential Viewpoint

BY MICHAEL JACKSON, RPH DANIEL E. BUFFINGTON, PHARMD, MBA, FAPHA ALYSON LOZICKI NELSON, PHARMD ALEX PYTLARZ, PHARMD

FDA Retreated from Their Attempts to Overregulate Compounding Pharmacies

The US Food and Drug Administration’s mission and purpose are to protect public health by ensuring the safety, efficacy, and security of human and veterinary drugs, biological products, and medical devices, and to ensure the safety of our nation's food supply, cosmetics, and products that emit radiation. They are not responsible for regulating health care practice standards or the pharmacy marketplace. However, for the past few years, they have attempted to regulate pharmacy business practices in states and dictate changes to their respective boards of pharmacy. This is most apparent with their attempt to force a “memorandum of understanding” or MOU that exerts limits and tracking of interstate sales of compounded medications.

This process started with an article originally drafted in 1997 and was initially named the “Memorandum of Understanding Addressing Certain Distributions of Compounded Drug Products Between the States and the US FDA”, currently referred to as the FDA Memorandum of Understanding (MOU). The MOU was created with consultation from the National Association of Boards of Pharmacy (NABP), Food, Drug, and Cosmetic Act, and nearly 20 years of dialogue and stakeholder input. The MOU was finally published disseminated to states in October of 2020 and boards of pharmacy were given 365 days to decide to enter. This document is directed specifically at 503A compounding pharmacies. Each state board of pharmacy or governing body was given the option to sign the MOU, which was designed to track the compounding pharmacies that shipped high volumes of compounded medications across state lines.

The purpose of the MOU was to establish an agreement between a state’s board of pharmacy, or other appropriate state agencies, and the FDA to monitor the interstate distribution of inordinate amounts of compounded human drug products. It also aimed to opti-

Daniel E. Buffington, PharmD, MBA, FAPhA

mize patient safety and reduce risks. Compounded medications distributed across state lines are easily tracked and monitored, and adverse event reporting becomes important and makes it imperative to be able to track an issue back to a single pharmacy or provider.

In an effort to strongarm states into signing on, the FDA created penalties for pharmacies in those states that refused to sign the MOU, including limiting the interstate distribution of compounded products to 5% of a pharmacy’s total volume. Conditions of the MOU would also subject the pharmacies to an investigation, pharmacies that ship 50% of compounded products out-of-state would be under much more rigorous documentation standards and regulatory burdens, and the financial impact on the state board of pharmacy to enforce these regulations would be substantial. This FDA’s attempt at regulating interstate distribution was not well received. As of the date of this article, few states had signed the MOU and the others are hesitant. Their resistance is primarily due to the excessive administrative burden needed for states to hire additional staff and develop new procedures simply to comply with the MOU as well as the potential for ongoing legal challenges from healthcare providers.

After the MOU was issued, the FDA was sued by several compounding pharmacies in the US district court. The court remanded the MOU back to the FDA with instruction to ensure small businesses would not be significantly impacted or to prepare a regulatory flexibility analysis to ensure the agency has researched all regulatory alternatives in order to curtail the rule’s economic burdens and provide the opportunity for the smaller entities impacted to still have a fair opportunity to succeed.

Pharmacies that executed the lawsuit felt that the FDA was exceeding their authority without considering the potential consequences of the MOU. The pharmacies claimed the FDA was failing to consider the administrative burden of the MOU under the Paperwork Reduction Act. In addition, they believe the FDA did not retain enough input from the state boards of pharmacy before drafting the MOU. Pharmacies are also debating the FDA’s position on dispensing and distribution, which according to the FDA are not distinct acts. The FDA may have taken advantage of congress establishing the inclusion of dispensing to a patient and distribution to healthcare practitioners, hospitals, or other entities as a single act in the Drug Quality Security Act (DQSA).

In response to the MOU, and as a market-driven alternative to strict regulations, NABP in conjunction with pharmacy owners, boards of pharmacy, and the FDA began the development of an electronic tracking program that would align with the sentiment of the MOU and help protect patient safety. With the assistance of an FDA grant, the NABP aims to create a system using e-Profiles that provides the state boards of pharmacy with information on each individual pharmacist, technician, student/intern, and facility that is participating. This will allow for information exchange between pharmacists, facilities, regulatory boards, and the FDA. Information such as that which is outlined in the MOU, complaints, inspection forms, and reports among other supporting data will be tracked. Benefits of this program would include reduced administrative burden for the boards of pharmacy and would streamline the documentation and reporting process and providing a more efficient method for protecting patient safety.

The FDA may have issued the MOU with good intentions of increasing the tracking and monitoring of compounded medication across state lines, it rapidly became apparent that they drifted out of their lane of statutory mission and jurisdiction over pharmaceutical manufacturers and into an attempt to regulate medical and pharmacy practice in the healthcare marketplace. The FDA has now retreated from the MOU in response to the overarching backlash and lawsuits and is expected to work together with stakeholders in a more collaborative nature to encourage the development and utilization of health information technology systems to improve product tracking from compounding pharmacy to the point-ofcare in order to identify and rapidly respond to patient safety risk factors. n