Compounding is the preparation, mixing, assembling, altering, packaging, and labeling of a drug or device in accordance with a licensed prescriber's prescription, medication order, or initiative based on the practitioner/patient/pharmacist/compounder relationship in the course of professional practice.
Compounding is subject to FDA, DEA, & State Board of Pharmacy oversight.
Expands FDA authority over compounded drugs and clarifies the difference between compounding and manufacturing.
- "Outsourcing Facility" designation:
Allows certain compounders to voluntarily register with the FDA as outsourcing facilities rather than traditional pharmacies. - cGMP compliance:
Outsourcing facilities must follow current Good Manufacturing Practices (cGMP) similar to manufacturers. - Limited exemptions:
May be exempt from new drug approval and labeling requirements, but not from cGMP. - Reporting requirements:
Must submit biannual reports of all compounded products and adverse event reports. - Risk‑based inspections:
Subject to risk‑based FDA inspections instead of routine pharmacy‑style inspections.
Many investigational drugs are supplied as compounded preparations.
The Right to Try Act allows certain terminally ill patients to access investigational drugs that have not yet received full FDA approval, outside of the traditional FDA expanded‑access (compassionate use) pathway.
Patient Criteria:
- Life‑threatening condition:
Have a serious or life‑threatening disease or condition. - Treatment exhaustion:
Have exhausted all FDA‑approved treatment options. - Trial ineligibility:
Be unable to participate in a clinical trial involving the investigational drug. - Informed consent:
Provide written informed consent, or have it provided by a legally authorized representative.
Drug Criteria:
- Phase 1 completed:
Successfully completed at least a Phase 1 clinical trial. - Active development:
Still in active clinical development (not discontinued). - Not FDA‑approved:
Not yet approved or licensed by the FDA for any indication.
Compounding is regulated by individual State Boards of Pharmacy; many of which delegate the creation of standards to the USP-NF
The USP–NF is an official compendium of drug standards used in the United States. It is published by the United States Pharmacopeial Convention (USP) and recognized by the U.S. Food and Drug Administration (FDA) as an enforceable standard under the Federal Food, Drug, and Cosmetic Act.
The USP–NF is actually two works combined into one:
| Component | Description |
|---|---|
| USP (United States Pharmacopeia) | Standards for medicines, dosage forms, drug substances, excipients, and nutritional supplements. |
| NF (National Formulary) | Standards for inactive ingredients (excipients), such as binders, fillers, preservatives, and flavorings. |
Together, the USP–NF provides quality standards to ensure:
- Identity
- Strength
- Purity
- Packaging and labeling
- Storage and handling
All prescription and OTC medications sold in the U.S. must comply with applicable USP–NF standards if they are labeled as such. Pharmacies and manufacturers must use USP–NF to ensure that compounded and commercial drugs meet national safety and quality standards. While USP is a non-governmental organization, its standards are legally enforceable by the FDA. Drugs failing to meet USP–NF standards are considered adulterated or misbranded under federal law.
Subscription-based reference from USP–NF containing enforceable and informational compounding standards.
Chapters <1> through <999> are enforceable by the FDA. The rest are purely informational.
| Chapter | Title | Description |
|---|---|---|
| <795> | Pharmaceutical Compounding - Nonsterile Preparations | Standards for nonsterile compounding, including facility requirements, BUD assignment, documentation, quality assurance, and personnel training. |
| <797> | Pharmaceutical Compounding - Sterile Preparations | Requirements for sterile compounding, including environmental controls, PEC/SEC standards, garbing, aseptic technique, sterility testing, and BUD assignment. |
| <800> | Hazardous Drugs - Handling in Healthcare Settings | Protects workers and patients by establishing standards for receiving, storing, compounding, administering, and disposing of hazardous drugs (HDs). |
| <1075> | Good Compounding Practices | Establishes foundational principles for safe, consistent, and high‑quality compounding. |
| <1160> | Pharmaceutical Calculations in Prescription Compounding | Provides guidance on accurate pharmaceutical calculations used in compounding and dispensing. |
| <1163> | Quality Assurance in Pharmaceutical Compounding | Outlines QA programs, testing, documentation, and performance metrics to ensure compounded preparation quality. |
| <1168> | Compounding for Phase I Investigational Studies | Provides guidance for preparing, packaging, labeling, and documenting compounded preparations used in Phase I clinical trials, including requirements for investigational products, study blinding, and sponsor‑protocol compliance. |
| <1176> | Prescription Balances and Volumetric Apparatus | Describes proper selection, calibration, and use of balances, pipettes, and volumetric equipment in compounding. |
🔗 Official USP Compounding Compendium
🧠 Quick Fact: The USP–NF is updated annually, with two supplemental updates each year to reflect evolving scientific standards.
Monographs are detailed documents that describe a drug, drug ingredient, or chemical. They function like standardized “recipes”, specifying:
- Allowed active ingredients
- Dosage strengths
- Dosage forms and routes of administration
- Labeling requirements
- Intended uses
- Stability and BUD expectations when the monograph is followed exactly
The Pharmacy Compounding Accreditation Board (PCAB), now part of the Accreditation Commission for Health Care (ACHC), provides voluntary accreditation for compounding pharmacies that meet rigorous quality and safety standards.
PCAB Accreditation Requirements include:
- Written SOPs for all compounding processes
- Documented quality assurance (QA) program
- Environmental monitoring (especially for sterile compounding)
- Personnel training and competency assessments
- Use of USP‑grade ingredients when available
- Robust documentation for every compounded preparation
- Demonstrated compliance with USP <795>, <797>, and <800>
📌 Note: PCAB accreditation is not required by law, but many hospitals, clinics, and prescribers prefer or require it for contracted compounding services.
Technicians compound under pharmacist supervision and must follow the master formulation record exactly.
Compounding documentation must show both what should happen and what actually happened.
-
Formulation record (master formulation record):
The "recipe" for a compounded preparation. Includes:- Name, strength, and dosage form
- All ingredients and quantities
- Equipment and step‑by‑step procedures
- Calculations, compatibility/stability references, and BUD guidance
- Required quality checks and labeling instructions
-
Compounding record (preparation record):
A record of what actually occurred when a specific batch was prepared. Includes:- Date and time of compounding
- Lot numbers, manufacturers, and expiration dates of each ingredient
- Actual quantities weighed/measured
- Identity of compounder and verifying pharmacist (initials/signatures)
- Assigned (internal) lot number and BUD
- Results of any in‑process or final checks
-
Bulk compounding log:
Specialized compounding record for bulk batches. Must include:- Complete ingredient list with amounts used
- Manufacturer, lot number, and expiration date of each ingredient
- Internal (facility) lot number for the bulk preparation
- BUD/expiration date for the bulk container
- Initials of the pharmacist who checks and releases the preparation
Questions to Ask Before Compounding:
- Is the Formulation Record prepared?
- Are pharmacy personnel qualified to prepare this?
- Are proper supplies and equipment available?
- Can the drug and ingredient identity, quality, and purity be assured?
- Is literature available about the preparation to help determine the correct BUD?
- What basic quality control measures will assure the preparation is compounded correctly?
- Does the patient have the necessary skills to use and store the preparation?
Preparation for Compounding:
- Gather all ingredients and supplies and bring them to the compounding area.
- Wash hands and perform appropriate hand hygiene.
- Clean and disinfect the compounding surface and required equipment.
- Verify the prescription, calculations, and formulation record with the pharmacist when required.
After Compounding:
- Package the preparation in an appropriate container and affix labels.
- Recheck all work
- Document the process in the Compounding Record.
Extemporaneous compounding is the on‑demand preparation of a drug product to meet the specific needs of an individual patient.
🧪 Extemporaneous Compounding Services Address:
-
Patient‑Specific Needs 👤
- Nonstandard dose or strength
(e.g., micro‑doses, pediatric strengths, geriatric titration doses) - Alternative route of administration
(e.g., oral → topical, oral → rectal) - Allergy or intolerance to excipients
Examples: dyes, lactose, gluten, alcohol, preservatives, fragrances - Need for improved adherence
(e.g., converting tablets to liquid, adding flavoring)
- Nonstandard dose or strength
-
Clinical or Therapeutic Requirements 🩺
- Therapeutic drug monitoring (TDM) requiring precise individualized doses
(e.g., tacrolimus suspensions, narrow‑therapeutic‑index drugs) - Dermatological preparations
(creams, ointments, gels, pastes, compounded acne or steroid formulations) - Veterinary or pediatric formulations
(species‑specific or child‑appropriate strengths)
- Therapeutic drug monitoring (TDM) requiring precise individualized doses
-
Product Availability Issues 📦
- Drug shortages
- Manufacturer discontinuations
- Temporary unavailability of commercial products
-
Specialized Preparations ⚗️
- Radiopharmaceuticals
(rare in outpatient settings but included for completeness) - TPN
(primarily inpatient, but included for conceptual accuracy) - Off‑label dosage forms
(e.g., converting oral meds into topical gels)
- Radiopharmaceuticals
Outpatient extemporaneous compounding focuses on patient‑specific, small‑volume preparations dispensed directly to the patient for home use.
Common outpatient examples include:
- Oral suspensions prepared from tablets/capsules
- Topical dermatologic preparations
- Pediatric liquid formulations
- Veterinary flavored liquids
- Hormone replacement therapy (HRT) creams
- Pain management gels (e.g., ketoprofen, lidocaine combinations)
Reconstitution counts as extemporaneous compounding only when performed according to a Master Formulation Record or prescriber instructions.
- 🦅x🐻 When reconstitution is performed exactly as the manufacturer label instructs, it is not legally considered compounding.
- It is a dispensing activity, but still requires proper documentation and counseling.
Billed Under Medical Benefit
Does NOT include simple manufacturer‑directed reconstitution at the point of sale.
Private Insurance may reimburse compounded prescriptions. Coverage depends on:
- Whether ingredients are FDA‑approved
- Whether ingredients are on formulary
- Plan‑specific compound policies
Public Insurance like Medicare and Medi‑Cal generally do NOT cover custom compounded medications.
Billing Notes:
- Compounds often require manual claim submission
- Some ingredients adjudicate while others reject
- Patients may face significant out‑of‑pocket costs
🚨 Technicians must verify coverage before compounding and notify patients of expected costs.
Bulk compounding is the preparation of a larger quantity of a compounded product in advance, to be dispensed later into individual prescriptions.
Bulk compounding requirements ✅
-
Documentation:
A bulk compounding log must be completed, including:- Full formula and batch size
- Ingredient sources, lot numbers, and expiration dates
- Date of preparation and assigned internal lot number
- Name/initials of the technician and verifying pharmacist
-
Labeling of bulk container:
The bulk container must be labeled with:- Name and strength/concentration of the compounded preparation
- Dosage form (e.g., oral suspension, ointment)
- Internal lot number (per facility)
- BUD/expiration date
- Storage conditions (e.g., “Refrigerate,” “Protect from light”)
- Initials of the pharmacist who checked and released the batch