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From the Townsend Letter
August/September 2014

The Art and Science of Compounding:
Where Are We Now, and How Did We Get Here?

by Carol Petersen, RPh, CNP
Women's International Pharmacy
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In the evolution of the practices of pharmacy and medicine, the preparation of "therapies" typically predates even the naming of the therapy. In primitive societies, the healing arts were practiced by a combination of sorcerer, priest, and medicine man, someone who was armed with "materia magica" rather than "materia medica."
Looking back at the intertwined histories of pharmacy and medicine may help build a framework for understanding some of the issues that we are grappling with today.

Historical Benchmarks
The earliest written medical texts were in fact a pharmacopeiawritten in the Sumerian language, dating around 2100 BC. These recipes described the use of oils, alcohols, wines, fats, honey, milk, and wax as vehicles, as well as processes such as extracting with water and oil, infusing with wine, pulverizing, boiling, filtering, and spreading. Tablets found from the 7th century BC provide evidence of approximately 250 drug substances of vegetable origin, 120 of mineral origin, and 180 of other origin.
Fast forward to the vast advances in the Persian world, and we find evidence of syrups, confections, plant oil extractions, and other combinations of materials. By then, weighing and measuring tools were also developed and subsequently documented by the great physician and philosopher Avicenna, who unified all known medical science into his Canon Medicinae. Translations of these texts into Latin eventually brought this knowledge to the Western world.
Medicine and pharmacy (as well as many other practices) have their roots in the medieval guild system, which served to protect the artisans who held a particular expertise. Modern-day professional organizations replicate the guild structure, and continue to exist primarily to protect the art and craft of their respective industries. In pharmacy, the guild philosophy of preparing for a single use still applies to the process of compounding, where a preparation is completed only at the request of a prescriber (i.e., a prescription).

Original Pharmacy Professional Organizations
The American Pharmaceutical Association (APhA) was founded in 1852, and evolved into the American Pharmacist Association. In 1898, the organization now known as the National Community Pharmacists Association (NCPA) was established.

However, the industrial revolution had a huge impact on the practice of pharmacy. The process of manufacturing demanded that institutions be capitalistic, and that production generated a profit. Rather than production for single use, some preparations lent themselves to the efficiencies that manufacturing could supply. These manufactured products could be produced in quantities, making the process less expensive, as well as becoming more easily standardized.
In 1820, the United States Pharmacopoeia (USP) was established to promote the standardization of formulas. While compounding was still the most prevalent way of formulating medications, it became less common as the pharmaceutical industry began providing standardized doses and dosage forms.
Another benchmark in the evolution of pharmacy in the US occurred in the 1870s, when patent and trademark laws allowed companies to advertise to ensure the creation of markets for manufactured products. Eventually, the promotional free-for-all that ensued led to the passage of the first Pure Food and Drug Act in 1906, which was replaced by the Food, Drug and Cosmetic Act, first established in 1938.
While pharmacists were still using a broad knowledge of compounding to serve their customers, by the 1920s the so-called patent medicines accounted for approximately 20% of their business. The first third of the 20th century ushered in even more radical changes in manufacturing that affected the practice of pharmacy. Chemistry and biochemistry had advanced such that new molecular entities could be created. The emergence of antibiotics, chemotherapeutic agents, hormones, radioactive agents, and vaccines created new fields in pharmaceutical science.
Over time, the traditional art of compounding began to fade away. By the 1960s, the concept of a "clinical pharmacy" had taken hold. Rather than being tied to the creation of preparations, pharmacists became more focused on dispensing drug products, in consultation with patients and practitioners. As a reflection of that change in thinking, compounding course work started to be eliminated from or minimized in the professional curricula.

A Revival, of Sorts
Although many in the profession considered compounding to be a dead end, credit is due to the formation of a company called the Professional Compounding Centers of America (PCCA). Its mission statement includes these words:

One patient. One prescriber. One pharmacist. A triad relationship with a common goal: achieving a positive therapeutic outcome for the patient. And in the midst of this relationship and this common goal is PCCA, the leader in pharmacy compounding since 1981.

PCCA recognized that manufactured medications could not always meet individual patients' particular needs, and some pharmacists began to embrace the challenges with great enthusiasm.
Moreover, the tools of the trade for compounding pharmacists had also evolved far beyond the mortars and pestles and balances of yesteryear. Automated mixing devices and instruments for qualitative and quantitative analyses were adapted to the compounding of smaller batches of individualized preparations. Now, there are precision electronic balances, which even allow for recording the weights of each active and nonactive ingredient. Computers are used to document all instructions and transactions.
More and more companies began to participate in the ancillary services spurred by the resurgence in compounding. Companies that supply the active ingredients, new dosage and delivery forms, specialized packaging, computer programming, specialized equipment, educational programs, training programs, laboratories and equipment to verify process and quality, and monitoring equipment flourished. Specialized sterile equipment even became affordable for pharmacy businesses.

The FDA and Other Challenges
The first sign of trouble for this burgeoning resuscitation of compounding came in 1989 with an internal Food and Drug Administration (FDA) document stating that, although the FDA probably did not have the authority within its statutes, it intended to regulate pharmacy compounding. By 1992, the FDA put its full force behind this position by issuing its first Compliance Policy Guide regarding compounding and beginning to inspect pharmacies.
To avoid the limitations of the FDA regulations on their authority to inspect, FDA inspectors enlisted the aid of state pharmacy inspectors to conduct their visits. Often, the results were citations and warning letters applying manufacturing regulations to pharmacy compounding – regulations that were impossible to meet in the context of a pharmacy. Of importance to note is that this action by the FDA was a serious incursion into the question of state versus federal rights. Up to this point, regulatory activities in the health sciences had traditionally been the responsibility of the individual states.
The FDA position became more solidified in the passing of the FDA Modernization Act (FDAMA) in 1997, which extended FDA regulations to include oversight of pharmacy compounding. In the following years, several lawsuits were initiated challenging the regulations. Of prime importance was a case that went before the US Supreme Court challenging the restrictions on commercial free speech when compounding. The outcome was a 5–4 decision preserving commercial free speech.
In the intervening years, a profusion of lawsuits, skirmishes, petitions, and challenges surfaced. In response, the compounding pharmacy industry formed another professional association, the International Academy of Compounding Pharmacists (IACP), to represent its segment of pharmacy practice. Professional pharmacy organizations came together to found the Pharmacy Compounding Accreditation Board (PCAB). PCAB is a voluntary quality accreditation designation for the compounding industry.
Almost all states made changes in their pharmacy practice acts to include regulation of any pharmacies that sent prescriptions into their states. The USP also made changes to its compendia, in addition to making recommendations for processes and procedures enforceable upon the practice, and particularly upon pharmacy compounding.
Yet somehow the layers of regulation and safeguards did not prevent the tragedy involving vials of methylprednisolone distributed between May and October 2012 by the New England Compounding Center (NECC) that resulted in many cases of fungal meningitis and a significant number of deaths. As it was established later, NECC was operating in violation of the Massachusetts pharmacy practice act by sending thousands of vials to practitioners and hospitals without patient-specific prescription orders. Sending non-patient-specific medication for office supply was not allowed by Massachusetts regulations. Both the Commonwealth of Massachusetts and the FDA had previously inspected and found problems with NECC, and both failed to take action. A public outcry for more regulation of compounding pharmacies resulted. Many in the industry pointed out that adequate regulations were already in place, but the regulators had simply failed to enforce them.

New Regulations and New Challenges
The NECC tragedy led to the passage of the Drug Quality and Security Act (DQSA), which was signed into law on November 27, 2013, amending the Food, Drug and Cosmetic Act. Many of the provisions of the earlier act under FDAMA were restored, with the constraints against free speech removed. Specifically, it restores the FDA's right to create both positive and negative formularies, to put restrictions on interstate provision of compounded medications, and to determine if a compounded medication is "too difficult to compound."
Recently, the IACP hosted its annual "Compounders on Capitol Hill" event, designed to facilitate member visits with their congressional representatives. The focus this year was on discussing the newly passed DQSA. The intent of Congress in passing the DQSA was to improve patient safety by preventing future occurrences such as the one that happened at NECC; however, there is concern that the FDA will ignore congressional intent in its implementation of the DQSA.
As of this writing, there are a number of areas within the DQSA that have yet to be clearly defined. For example, it is unclear whether compounding pharmacies may compound non-patient-specific medications for practitioners to administer to patients in their offices. The FDA contends that compounding for office administration is not allowed; however, it is not clearly addressed in the regulations. Further complicating the matter, some states already have clear regulations permitting the compounding of medications for office administration. A second example is whether or not states will have the authority to license FDA-regulated outsourcing facilities. A number of states have started enacting laws under the belief that they have the right to oversee any delivery of drugs within their borders.
Another section of the law (503b) creates a new entity called an "outsourcing facility," which may or may not be a pharmacy, and which compounds sterile drug preparations to be sent directly to hospitals and practitioners. Outsourcing facilities are directly under FDA oversight. Physicians, as well as pharmacists, are allowed to compound under this act.
Questions arise regarding the standards that a practitioner must follow if compounding is done in a medical office setting. For example, the USP has delineated the processes to follow when even low-risk sterile compounding is done. Low-risk sterile compounding is performed when two or more sterile products are mixed together.
Will physicians be required to write procedure manuals, certify sterile procedures, and document the environment, as pharmacists involved in sterile compounding must already do?
Yet another area of concern is the recent restoration of the FDA's charge to create memoranda of understanding (MOU) with each state to determine the conditions governing the rights of compounding pharmacists to send their preparations into another state. Without a MOU in place, the law limits the distribution to 5% of total prescription orders dispensed or distributed. This provision was first introduced to clarify the authority of the state with regard to interstate transactions. Since this provision appeared in the FDA Modernization Act in 1997, almost all states have passed regulations requiring the licensing of pharmacies that regularly supply preparations to their residents, thus closing this gap. Whether the FDA deems the measures by the states to be adequate remains to be seen.
To add to the confusion regarding DQSA interpretation, the Drug Enforcement Agency (DEA) has its own viewpoint on the dispensing and manufacturing of drugs and some of the entities involved have their own definitions of compounding.

The DEA's View of Compounding for Office Supply or Administration
The Drug Enforcement Agency (DEA) contends that any pharmacy that supplies a compounded controlled drug to another DEA registrant’s office (such as a physician) cannot be dispensing because, under its definitions, the drug must be delivered to the final user. Therefore, the DEA believes that the compounding pharmacist is illegally manufacturing a drug. On the contrary, manufactured drugs can be provided for office supply and administration. Legislative relief is currently being sought for office supply of compounded preparations.

The current DEA definitions, as extracted from the Controlled Substance Act, Subchapter 1, Control and Enforcement, are:
•   The term "dispense" means to deliver a controlled substance to an ultimate user or research subject by, or pursuant to the lawful order of, a practitioner, including the prescribing and administering of a controlled substance and the packaging, labeling or compounding necessary to prepare the substance for such delivery. The term "dispenser" means a practitioner who so delivers a controlled substance to an ultimate user or research subject.
•   The term "manufacture" means the production, preparation, propagation, compounding, or processing of a drug or other substance, either directly or indirectly or by extraction from substances of natural origin, or independently by means of chemical synthesis or by a combination of extraction and chemical synthesis, and includes any packaging or repackaging of such substance or labeling or relabeling of its container; except that such term does not include the preparation, compounding, packaging, or labeling of a drug or other substance in conformity with applicable State or local law by a practitioner as an incident to his administration or dispensing of such drug or substance in the course of his professional practice. The term "manufacturer" means a person who manufactures a drug or other substance.

What is the Current Definition of Compounding?
In addition to the confusion generated by the tortuous definitions of "dispense" and "manufacture" supplied by the DEA, some of the various regulatory entities involved have their own definitions of "compounding." On top of that, each state has a definition of compounding in its pharmacy practice act. The following definitions were published in the May 23, 2014, Compounding This Week, an e-newsletter by Dr. Loyd Allen, editor in chief:
•   H.R. 3204 Definition (now in the Drug Quality and Security Act)
    "The term 'compounding' includes the combining, admixing, mixing, diluting, pooling, reconstituting, or otherwise altering of a drug or bulk drug substance to create a drug."
•   FDA Note
    "… the term 'compounding' does not include mixing, reconstituting, or other such acts that are performed in accordance with directions contained in approved labeling provided by the product’s manufacturer and other manufacturer directions consistent with that labeling."
•   USP Definition
"The preparation, mixing, assembling, altering, packaging, and labeling of a drug, drug-delivery device, or device in accordance with a licensed practitioner's prescription, medication order, or initiative based on the practitioner/ patient/ pharmacist/ compounder relationship in the course of professional practice.

Compounding includes the following:

  • Preparation of drug dosage forms for both human and animal patients
  • Preparation of drugs or devices in anticipation of prescription drug orders based on routine, regularly observed prescribing patterns
  • Reconstitution or manipulation of commercial products that may require the addition of one or more ingredients
  • Preparation of drugs or devices for the purposes of, or as an incident to, research (clinical or academic), teaching, or chemical analysis
  • Preparation of drugs and devices for prescriber’s office use where permitted by federal and state law."

•   NABP Definition (National Association of Boards of Pharmacy)
"Compounding" means the preparation of Components into a Drug product (1) as the result of a Practitioner’s Prescription Drug Order based on the Practitioner/patient/Pharmacist relationship in the course of professional practice, or (2) for the purpose of, or as an incident to, research, teaching, or chemical analysis and not for sale or Dispensing. Compounding includes the preparation of limited amounts of Drugs or Devices in anticipation of receiving Prescription Drug Orders based on routine, regularly observed prescribing patterns."

More challenges, lawsuits, and potentially conflicting interpretations of the regulations are likely to continue. Nevertheless, as pharmacy law changes, the practice of compounding will continue to evolve. The USP has even begun to standardize some of the most commonly used formulas. Compounding pharmacists also continue to bridge an important gap by preparing formulas that manufacturers are temporarily unable to supply, or choose not to supply for economic reasons.
Despite the current disarray in regulations, Dr. Loyd Allen of the International Journal of Pharmaceutical Compounding points out that the future is very bright for compounding. With rapid increases in our body of knowledge about the uniqueness of our biology, physiology, and genetic expression, the demand for individualized solutions for health problems can only increase. And with the practice of pharmacy compounding geared up with 21st-century technology, there are plenty of pharmacists who are not content to be purveyors of mass-produced medicine and stand ready for the challenges ahead.

For additional information, please consult these resources:

  • The International Academy of Compounding Pharmacists (IACP): This organization sponsors an advocacy group for patients and professionals, Partnership for Personalized Prescriptions.
  • Patients and Physicians for Rx Access:
  • American Pharmacists Association (APhA):
  • Women in Balance Institute, www.womeninbalance.orgcustomized care in women's health.
  • Alliance for Natural Health,

Cowen DL, Helfand WH. Pharmacy: An Illustrated History. New York: Harry N. Abrams Inc.; 1990.
CPG Sec. 460.200 Pharmacy compounding (withdrawn December 4, 2013) [Web page]. FDA.

Maitland S. Compounders on Capitol Hill: what you need to know to be prepared! An interview with David Miller and Cynthia Blankenship. PM Q. Spring 2014:20–24.

Supreme Court challenge [online document]. US Department of Justice.

Text of the Drug Quality and Security Act [Web page]. GovTrak.

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