Ensuring Safety of Compounded Sterile Products: A New Regulatory Framework

Conquering the Cancer Care Continuum – Series Three: First Issue —March 9, 2015
Daniel A. Kracov, JD

Confusion over the rules governing drug compounding has been an issue for many years. However, concerns about the safety and quality of compounded sterile products (CSPs), spurred by an outbreak of fungal meningitis infections that occurred in October 2012, have led to a fundamental change in the regulatory framework.1

In that month, the US Food and Drug Administration (FDA) advised healthcare providers to cease using products manufactured by New England Compounding Center (NECC) of Framingham, Massachusetts, and NECC recalled all of its compounded products.2 These steps were taken as a consequence of a multistate outbreak of fungal meningitis and other infections among patients who received contaminated injectable products manufactured by NECC.2 According to the Centers for Disease Control and Prevention, a total of 751 people developed infections, with 64 fatalities.3

In part due to the NECC crisis, new legislation was enacted in November 2013: the Drug Quality and Security Act (DQSA). Title I of the DQSA, known as the Compounding Quality Act (CQA) (section 102), addressed problems caused by earlier amendments to the Federal Food, Drug, and Cosmetic Act (FDCA) that were found to be unconstitutional by the US 
Supreme Court in 2002, and created ambiguity as to FDA authorities. The CQA expands upon those provisions to create a new regulatory construct for the regulation of compounding.4,5
Under the CQA, state boards of pharmacy will continue to oversee and regulate the practice of pharmacy, including traditional pharmacy compounding (ie, compounding pharmacies that manufacture specific products upon receipt of a prescription for an individual patient or in anticipation of prescriptions based on a documented history of prescribing for individual patients). However, a new category of outsourcing facilities, created by the CQA and regulated by the FDA, is essentially an intermediate form of drug manufacturer between traditional compounding pharmacies and pharmaceutical manufacturers that produce FDA-approved drugs.5

Specifically, under new FDCA section 503B, drugs made by outsourcing facilities are exempt from new drug requirements, labeling, and track-and-trace requirements, presuming they are compounded by, or under the direct supervision of, a licensed pharmacist in a registered outsourcing facility and meet applicable requirements.5 Outsourcing facilities are required to report biannually to the Secretary of Health & Human Services regarding drugs compounded in the facility and to submit adverse event reports. These facilities are also subject to a risk-based inspection schedule.5 Compounders that do not register as outsourcing facilities can qualify as traditional compounders under section 503A of the FDCA. To the extent they otherwise fall outside these categories, they would be subject to all requirements in the FDCA that are applicable to conventional manufacturers.

The new legislation and its implications are directly relevant to oncologists, oncology nurses, oncology pharmacists, and other healthcare professionals who order, prepare, and administer injectable products for patient use. The CQA allows hospitals and other healthcare providers to evaluate novel strategies to obtain CSPs for their patients, including the use of outsourcing facilities that have registered with the FDA. 

Providers of oncology care should know that, like pharmaceutical manufacturers, outsourcing facilities must comply with current good manufacturing practices (cGMPs). However, unlike pharmaceutical manufacturers, and assuming the product is not otherwise commercially available from a manufacturer, outsourcing facilities can produce specific CSPs without seeking FDA approval and without individual patient prescriptions, unlike traditional compounders. Thus, they can produce products in large quantities. 

To date, the FDA has focused on producing guidance for outsourcing facilities related to registration with the agency and adherence to cGMP requirements: facility design, environmental monitoring, production and process controls, packaging and labeling, and complaint handling. Outsourcing facilities must also adhere to the following:

  • Bulk substances used in manufacturing of CSPs must meet certain requirements and comply with the US Pharmacopeia and National Formulary monographs. 
  • Nonbulk ingredients must be safe and effective. Drugs withdrawn or removed from the market because of concerns about safety or effectiveness, or with demonstrable difficulties for compounding and/or safety concerns, cannot be used.6 
  • CSPs cannot be copies of 1 or more commercially available drugs. They must be distinct relative to FDA-approved drugs: change in dosage form, change in route of administration, or addition of ingredients. CSPs cannot compete directly with approved drugs.
  • If a risk evaluation and mitigation strategy (REMS) is in place for a given ingredient, outsourcing facilities must follow REMS controls and restrictions for CSPs that include the ingredient. 
  • CSPs made in an outsourcing facility must be labeled to indicate that they are compounded, and they must include the drug name, lot and batch number, dosage form, and strength.
  • CSPs made by outsourcing facilities can be sold only by the facility, not marketed or distributed by other firms.

Cancer care providers should understand that the FDA is urging hospital systems and private payers to purchase CSPs from outsourcing facilities, rather than from traditional compounding pharmacies. Because registered outsourcing facilities are subject to cGMP, they will arguably better ensure patient safety. However, the costs associated with CSPs produced by registered outsourcing facilities have generated controversy. Various private plans have established barriers to CSP access in order to avoid paying outsourcing facilities’ prices. Such pressures will only increase as more health systems accept capitated payments and implement other cost-containment approaches. 

To date, over 55 CSP compounders are 503B-registered outsourcing facilities.7 Oncology care providers are urged to review this FDA-updated list to learn whether their source of CSPs is registered. However, it is important to note that mere registration with the FDA does not indicate any agreement by the agency that the facility is in fact in compliance with the requirements for outsourcing facility status.

Implementation of the CQA will take time. The FDA is continuing efforts to inspect both traditional compounding and outsourcing facilities, and undoubtedly issues will arise in that context, which will result in further guidance. This will be an ongoing, active area for policy-making for several years. Additional drug-compounding–related issues on which the FDA is likely to opine relate to production of biologic injectable products, and distinctions between repackaging of sterile drugs and compounding. It behooves cancer care providers to keep abreast of these developments, because they directly affect the quality and safety of patient care.


  1. Insourcing IV sterile compounding. Pain Medicine News. 2014;12(8). http://www.painmedicinenews.com/ViewArticle.aspx?d=Science%2B%26%
    2BTechnology&d_id=354&i=August+2014&i_id=1092&a_id=27880. Accessed September 10, 2014.
  2. US Food and Drug Administration. Fungal meningitis outbreak. Latest update November 1, 2012. http://www.fda.gov/Safety/MedWatch/SafetyInformation/SafetyAlertsforHumanMedicalProducts/ucm323946.htm. Accessed September 10, 2014.
  3. Centers for Disease Control and Prevention. Multistate outbreak of fungal meningitis and other infections—case count. Latest update October 23, 2013. http://www.cdc.gov/hai/outbreaks/meningitis-map-large.html. Accessed September 10, 2014.
  4. Congress.gov. H.R.3204—Drug Quality and Security Act. Summary: H.R.3204—113th Congress (2013-2014). November 27, 2013. https://beta.congress.gov/bill/113th-congress/house-bill/3204. Accessed September 10, 2014. 
  5. US Food and Drug Administration. Compounding Quality Act: Title I of the Drug Quality and Security Act of 2013. Latest update September 10, 2014. http://www.fda.gov/drugs/guidancecomplianceregulatoryinformation/pharmacycompounding/default.htm. Accessed September 10, 2014.
  6. US Food and Drug Administration. CFR—Code of Federal Regulations Title 21. Updated April 1, 2013. http://www.accessdata.fda.gov/scripts/cdrh/cfdocs/cfcfr/CFRSearch.cfm?CFRPart=216&showFR=1&subpartNode=21: Accessed September 10, 2014.
  7. US Food and Drug Administration. US Department of Health & Human Services. Registered Outsourcing Facilities. Revised August 22, 2014.
Last modified: August 10, 2023

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