Reed Smith Client Alerts

On September 25, 2018, the United States Food & Drug Administration (“FDA”) released its second draft guidance regarding insanitary conditions entitled, “Insanitary Conditions at Compounding Facilities,” (the “Revised Draft Guidance”). The Revised Draft Guidance was issued to help compounders (i.e., Section 503A pharmacies and Section 503B outsourcing facilities, discussed further below) identify insanitary conditions so that appropriate corrective actions can be implemented. The original draft guidance was issued in 2016, and subsequently inappropriately applied by FDA in many inspections of compounders. The 2016 guidance was revised in large part due to the comments FDA received from the industry, and the Revised Draft Guidance now outlines a non-exhaustive list of examples of insanitary conditions, suggested corrective actions a compounding facility can take when it identifies insanitary conditions, and regulatory actions FDA may take in response to insanitary conditions. As always, FDA’s guidance documents do not establish legally enforceable responsibilities and are issued to provide FDA’s current thinking on a topic. Nevertheless, it is important to note the issues outlined below as they will help compounders manage compliance and regulatory risk within their practice. 

Authors: Rachael G. Pontikes Emily L. Hussey John D. Kendzior Kelly J. Kearney

Background on compounding pharmacies and insanitary conditions 

The Federal Food Drug & Cosmetic Act (“FDCA”) identifies two forms of compounding: (1) by a Section 503A pharmacy; and (2) by a Section 503B outsourcing facility. See 21 U.S.C.A. §§ 353a, 353b. Being a Section 503A pharmacy or Section 503B outsourcing facility qualifies the facility for certain exemptions under the FDCA. Despite these exemptions, FDA takes the position that compounders must comply with the drug adulteration provisions in Section 501(a)(2)(A) of the FDCA, which state that a drug is deemed to be adulterated if it has been “prepared, packed, or held under insanitary conditions whereby it may have been contaminated with filth, or whereby it may have been rendered injurious to health.” 21 U.S.C. § 351(a)(2)(A) (emphasis added). 

FDA’s “recommendations” in its Revised Draft Guidance for regulating potential insanitary conditions at compounding pharmacies and outsourcing facilities 

FDA provided a non-exhaustive list of examples of insanitary conditions to consider when compounding sterile and non-sterile drugs. Upon identifying insanitary conditions, FDA suggests that the compounder immediately assess the impact on the drug products produced and determine whether to initiate a recall of all potentially affected product on the market. If certain conditions exist, such as vermin or visible microbial growth, FDA “strongly recommends” the compounding facility immediately initiate a recall of the potentially affected sterile products, a recommendation that was also present in the 2016 guidance.

If a compounding facility produces drugs under insanitary conditions, the facility and the individuals responsible may be subject to regulatory action by FDA. Potential regulatory actions include a warning letter, seizure of product, injunction, or FDA may recommend a recall.

After reviewing industry comments, FDA made some improvements in its Revised Draft Guidance to specifically address different types of compounding

FDA made a series of changes to the original draft guidance it issued two years ago. Some of these notable improvements include:

  • The Revised Draft Guidance only applies to human drug compounding, rather than human and veterinary drug compounding.
  • FDA separated the application of the Revised Draft Guidance between Section 503A pharmacies and Section 503B outsourcing facilities. Specifically, FDA generally does not intend to take action against Section 503A pharmacies with respect to certain conditions in the Revised Draft Guidance so long as the pharmacy is in compliance with specified criteria.
  • FDA took into account a compounder’s compliance with USP General Chapter <797>, Pharmaceutical Compounding – Sterile, which it did not consider in the same way in its 2016 guidance.
  • FDA generally does not intend to take action for insanitary conditions against a physician compounding a drug under certain circumstances.
  • Acknowledgment that state boards of pharmacy have primary regulation over section 503A pharmacies.

What’s next?

Moving forward, we expect FDA to inspect compounders against the Revised Draft Guidance even though guidance documents do not establish legally enforceable responsibilities and this document remains a draft guidance. This behavior will be consistent with how FDA enforced its 2016 draft guidance during its inspections of compounders. 

The issuance of this Revised Draft Guidance is another indication that FDA continues to actively oversee the regulation of drug compounding in its various enforcement initiatives. As such, drug compounders should continue to closely monitor their compliance with all applicable state and federal regulation and guidance.
Should you have any questions regarding the Revised Draft Guidance or any of the issues raised in this alert, please do not hesitate to reach out to Rachael Pontikes, Emily Hussey, John Kendzior, or Kelly Kearney for further discussion.

Client alert 2018-206