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97–957 PDF 2016

S. HRG. 113–756 

PHARMACEUTICAL COMPOUNDING: 

PROPOSED LEGISLATIVE SOLUTION 

HEARING 

OF THE

COMMITTEE ON HEALTH, EDUCATION, 

LABOR, AND PENSIONS 

UNITED STATES SENATE 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

ON

EXAMINING PHARMACEUTICAL COMPOUNDING, FOCUSING ON A 

PROPOSED LEGISLATIVE SOLUTION 

MAY 9, 2013 

Printed for the use of the Committee on Health, Education, Labor, and Pensions 

( 

Available via the World Wide Web: http://www.gpo.gov/fdsys/ 

COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS 

TOM HARKIN, Iowa, Chairman 

BARBARA A. MIKULSKI, Maryland 

PATTY MURRAY, Washington 

BERNARD SANDERS (I), Vermont 

ROBERT P. CASEY, JR., Pennsylvania 

KAY R. HAGAN, North Carolina 

AL FRANKEN, Minnesota 

MICHAEL F. BENNET, Colorado 

SHELDON WHITEHOUSE, Rhode Island 

TAMMY BALDWIN, Wisconsin 

CHRISTOPHER S. MURPHY, Connecticut 

ELIZABETH WARREN, Massachusetts 

LAMAR ALEXANDER, Tennessee 

MICHAEL B. ENZI, Wyoming 

RICHARD BURR, North Carolina 

JOHNNY ISAKSON, Georgia 

RAND PAUL, Kentucky 

ORRIN G. HATCH, Utah 

PAT ROBERTS, Kansas 

LISA MURKOWSKI, Alaska 

MARK KIRK, Illinois 

TIM SCOTT, South Carolina 

PAMELA SMITH, Staff Director 

LAUREN MCFERRAN, Deputy Staff Director and Chief Counsel 

DAVID P. CLEARY, Republican Staff Director 

(II) 

C O N T E N T S 

STATEMENTS 

THURSDAY, MAY 9, 2013 

Page 

COMMITTEE MEMBERS

Harkin, Hon. Tom, Chairman, Committee on Health, Education, Labor, and 

Pensions, opening statement ............................................................................... 1 

Alexander, Hon. Lamar, a U.S. Senator from the State of Tennessee ................ 2 

Prepared statement .......................................................................................... 3 

Mikulski, Hon. Barbara A., a U.S. Senator from the State of Maryland ............ 6 

Roberts, Hon. Pat, a U.S. Senator from the State of Kansas .............................. 6 

Warren, Hon. Elizabeth, a U.S. Senator from the State of Massachusetts ........ 16 

Enzi, Hon. Michael B., a U.S. Senator from the State of Wyoming .................... 20 

Baldwin, Hon. Tammy, a U.S. Senator from the State of Wisconsin .................. 22 

Franken, Hon. Al, a U.S. Senator from the State of Minnesota .......................... 24 

WITNESSES—PANEL I 

Woodcock, Janet, M.D., Director, Center for Drug Evaluation and Research, 

Food and Drug Administration, U.S. Department of Health and Human 

Services, Silver Spring, MD ................................................................................ 7 

Prepared statement .......................................................................................... 8 

WITNESSES—PANEL II 

Catizone, Carmen S., M.S., RPh, DPh, Executive Director, National Association of Boards of Pharmacy, Mount Prospect, IL .............................................. 27 

Prepared statement .......................................................................................... 28 

Coukell, Allan, Director, Medical Programs, The Pew Charitable Trusts, 

Washington, DC ................................................................................................... 31 

Prepared statement .......................................................................................... 33 

Miller, David G., Executive Vice President and CEO, International Academy 

of Compounding Pharmacists, Missouri City, TX ............................................. 38 

Prepared statement .......................................................................................... 40 

Thompson, Kasey K., PharmD, Vice President, Office of Policy, Planning 

and Communications, American Society of Health-System Pharmacists, Bethesda, MD ........................................................................................................... 44 

Prepared statement .......................................................................................... 46 

ADDITIONAL MATERIAL 

Statements, articles, publications, letters, etc.: 

Response to questions of Senator Enzi by: 

Sally Howard for Janet Woodcock, M.D. ................................................. 58 

Melissa Madigan, PharmD, JD, for Carmen S. Catizone, M.S., RPh, 

DPh ......................................................................................................... 59 

Allan Coukell ............................................................................................. 59 

Kasey K. Thompson, PharmD .................................................................. 60 

(III) 

(1) 

PHARMACEUTICAL COMPOUNDING: 

PROPOSED LEGISLATIVE SOLUTION 

THURSDAY, MAY 9, 2013 

U.S. SENATE, 

COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS, 

Washington, DC. 

The committee met, pursuant to notice, at 10:12 a.m., in room 

SD–430, Dirksen Senate Office Building, Hon. Tom Harkin, chairman of the committee, presiding. 

Present: Senators Harkin, Alexander, Mikulski, Casey, Franken, 

Baldwin, Murphy, Warren, Enzi, and Roberts. 

OPENING STATEMENT OF SENATOR HARKIN

The CHAIRMAN. Good morning. The Senate HELP Committee will 

come to order. I’m sorry for being late. I have excuses, but I won’t 

use them. 

Last November, this committee convened a hearing to better understand what caused one of the worst public health crises this 

country has experienced in recent years, the meningitis outbreak 

that has claimed the lives of 53 Americans and sickened over 700. 

Through that hearing and the efforts of our investigation teams, we 

have developed a better understanding of the legal and regulatory 

gaps that allowed owners and managers at the New England 

Compounding Center to disregard basic procedures to ensure that 

the products they were manufacturing were sterile. This gross negligence had heartbreaking consequences for families nationwide. 

Following that hearing, members of this committee initiated a bipartisan investigation involving all of our offices. We met several 

times a week to identify and examine the various issues around 

compounding and to conduct discussions with stakeholders with a 

goal of developing a draft proposal. 

Today, we have convened this hearing to look forward. We want 

to talk about solutions. As most of you know, almost 2 weeks ago, 

we released a bipartisan draft proposal designed to improve the 

safety of compounded human and animal drugs. Our purpose today 

is to gather key stakeholder input about that draft so that we can 

refine it as we move toward markup. 

As we talk to our witnesses today, I will be asking them how 

well the draft fulfills the purposes which we want it to, to make 

clear the compounding oversight responsibilities of State and Federal authorities; second, to provide FDA the tools it needs to oversee the entities for which it will be primarily responsible. And, 

again, we want to see how well our bill does fulfill those responVerDate Nov 24 2008 12:52 Mar 18, 2016 Jkt 000000 PO 00000 Frm 00005 Fmt 6633 Sfmt 6633 S:\DOCS\97957.TXT DENISE
2 

sibilities. Does it really give FDA the tools it needs? Does it clarify 

responsibilities? Does it improve the safety of compounded drugs so 

that patients nationwide can trust the quality and safety of their 

medicines? 

So with what we learn today, we will then proceed to modify and 

improve the draft as necessary with the goal of a markup before 

Memorial Day. So I look forward to working again, as we have in 

the past, with members of this committee to refine our draft to better ensure the quality of compounded drugs. 

With that, I’ll yield to Senator Alexander. 

OPENING STATEMENT OF SENATOR ALEXANDER

Senator ALEXANDER. Thanks, Mr. Chairman. Thanks to you and 

to Senator Roberts, Senator Franken, and other Senators and the 

staff, all those who have worked on this. This has been a good process. The outbreak of fungal meningitis was a nightmare for Tennesseans. We’ve had 150 cases with 15 deaths. There was some 

heroism on the part of some of our State officials who discovered 

the problem, helped alert other States about it, and worked with 

the FDA. 

When we met to discuss this in November, I made it clear that 

I have a single goal here, or at least a primary goal. That is to 

make sure who is on the flagpole, who is accountable, to eliminate 

any confusion about responsibility. 

Let me take just a minute on that. When I was a new Governor, 

I remember a cabinet meeting, and we had a very important bill 

to pass. We all agreed we’d go to work on it, and we passed it during the week in the legislature. We got back together a week later 

and nothing had happened. So I said, ‘‘Let’s try something else.’’ 

Granville Hinton was a member of the cabinet, and I said, 

‘‘Granny’s on the flagpole, so we’ll all help him, but if it passes, it’s 

to his credit, and if it doesn’t, it’s his fault.’’ And you’d be surprised. We got back together the following week, and it had passed 

because Granville knew that. 

That happens in a lot of lines of work. Hyman Rickover understood it with the nuclear Navy in the 1950s. He told the captains 

of every nuclear submarine—he personally hired them, and he told 

them they had two responsibilities. One was the ship, and the second was the reactor, that if anything went wrong with the reactor, 

the captain was personally responsible for it, and his career in the 

Navy was probably in the dust if anything happened. 

As a result, during that entire time since the 1950s, there’s never 

been a death as a result of a nuclear reactor on a Naval submarine. 

I’d like to see that kind of accountability here when we talk about 

pharmacies. We’ve developed a bill, working with FDA, pharmacists, doctors, hospitals, and very many members of this committee, that passes that test, that tries to set clear lines for who 

is in charge and when they’re in charge. I hope to hear from the 

witnesses today what they think about this and how we can improve it. 

To very briefly summarize it, it creates three categories. One is 

the traditional drug manufacturer. FDA would continue to regulate 

that. The second category is a new category defined as compound 

manufacturers. These are businesses that make sterile products in 

3 

advance of a prescription and sell them across State lines. They fill 

a need when the products made by the drug manufacturers need 

to be tailored or combined for certain hospital patients. Hospitals 

increasingly turn to compounding manufacturers to make those 

changes to the drugs. This new category of compounding manufacturers will be regulated by the FDA. 

The third category is the traditional pharmacy, defined as pharmacies that sell compound non-sterile products, such as lotions, 

that only sell in their State or receive prescriptions before beginning the compounding. States will continue to oversee and regulate 

these traditional pharmacies. So when you walk into a facility, it 

will be clear who is in charge of regulating that facility, or if in the 

draft regulation it’s not, we would like your advice about how to 

make it clear. 

We heard a lot in our discussions, some that we expected to hear, 

some more than we expected. For example, we heard more than we 

expected to hear, I think, about drug shortages. We have tried to 

address that, and we know that compounded products are not the 

answer to drug shortages. But we don’t want drug shortages, and 

we want to deal with that, and we can. 

There are a number of other suggestions that we heard that we 

tried to incorporate. We can deal with that in the questions of several Senators who want to be involved. So, Mr. Chairman, I’d like 

to submit my entire statement for the record and let us proceed 

with the hearing. 

[The prepared statement of Senator Alexander follows:] 

PREPARED STATEMENT OF SENATOR ALEXANDER

Thank you, Mr. Chairman. I’m very glad to be here and to be 

having this important hearing. 

The ongoing outbreak of fungal infections stemming from contaminated product from the New England Compounding Center 

has been a nightmare for Tennessee. As of May 6, there have been 

741 cases of fungal infections, including 55 deaths. Tennessee has 

seen over 150 cases and 15 deaths. 

When we met to discuss this tragedy last November, I made it 

clear that my goal was to work on crafting legislation that would 

clarify who is in charge and on the flagpole for regulating 

compounding facilities. I wanted to ensure that something like last 

year’s outbreak never happens again—to make sure we can walk 

into any one of our 60,000 drugstores or pharmacies, or go to our 

doctors or pain clinics, and not have to worry about whether the 

medicines we get there are safe. 

For the past several months Senator Harkin and I, along with 

Senator Roberts and Senator Franken and all of the Senators on 

the committee, have been working together on this draft legislation. I truly believe we have developed a bill that sets clear lines 

for who is in charge of what and when. 

With input from the Food and Drug Administration (FDA), State 

boards of pharmacy, pharmacists, doctors, hospitals, consumer 

groups, and others, we have developed a system to define three different categories of facilities and to make it clear who regulates the 

businesses in each one. 

4 

The first category is drug manufacturers. The FDA would continue to regulate traditional drug manufacturers and approve their 

drugs for safety and efficacy before being marketed. 

The second category is a new one, defined as ‘‘compounding manufacturers’’ in our draft legislation. These are businesses that make 

sterile products in advance of a prescription and sell them across 

State lines. These compounding manufacturers fill a need when the 

products made by drug manufacturers need to be tailored or combined for specific hospital patients. Hospitals increasingly turn to 

compounding manufacturers to make those modifications to the 

drugs. In our draft legislation, this new category of compounding 

manufacturers will be regulated by the FDA. Compounding manufacturers will register and list their products with the FDA, and be 

inspected by the FDA. Compounding manufacturers will also have 

to investigate and report when things go wrong. 

The third category is the traditional pharmacy, defined as pharmacies that compound non-sterile products (such as lotions), or 

only sell in their State, or receive prescriptions before beginning 

the compounding. States will continue to oversee and regulate 

these traditional pharmacies. State boards of pharmacy will have 

clear guidance on which facilities to license as a pharmacy. 

If, during an inspection, the State board realizes that a pharmacy business has grown and started shipping sterile products out 

of State and does not have prescriptions for those products, the 

State board of pharmacy will know that facility should be under 

FDA jurisdiction and not licensed as a pharmacy. The goal is that 

when you walk into a facility, it will be clear who is in charge of 

regulating that facility. 

We are making clear distinctions between these businesses to enable clear regulation of each one. This means that businesses currently operating in the first and third categories will have to make 

a change. For example, a facility that currently sells only a few 

sterile products without a prescription across State lines will have 

to decide whether to upgrade that facility and meet FDA requirements, or change their business model to get prescriptions before 

compounding. This is necessary to ensure that consumers and doctors know that the products they are using are safe. 

Our bill also mandates increased communication between States 

and the FDA. We know that a lack of communication was a major 

factor in the case with NECC. Many States sent red flags about 

NECC to FDA, but we do not know if the Massachusetts Board of 

Pharmacy received those same complaints. The FDA assumed that 

the Massachusetts Board of Pharmacy was in charge, and the State 

board assumed that the FDA was in charge. Under our proposal, 

if the FDA receives a complaint from a State board about an outof-state traditional pharmacy, the FDA has to notify the State 

board where the facility is located of the complaint within 15 days. 

I know that some people advocate for allowing the FDA to have 

access to records of all pharmacies, but I believe that would blur 

the lines of accountability when the purpose of this bill is to clarify 

accountability. If States and the FDA can communicate effectively, 

there is no need for duplicative inspections. I hope to hear ideas 

from both the FDA and the National Association of the Boards of 

5 

Pharmacy today about how to improve coordination and communication in our proposal. 

Throughout the process of writing this legislation, we heard 

about the impact drug shortages are having on patient care. We 

want to ensure that nothing we’re doing makes drug shortages 

worse. Continued access to patient specific compounded products is 

very important, and we need to do all we can to alleviate current 

shortages of manufactured drugs. 

Compounded products are not the answer to drug shortages. We 

would prefer for patients to receive drugs approved by the FDA and 

manufactured in a FDA facility. However, in the case of drug shortages where no other manufacturer can step in and there is not an 

option to import products, patients and providers need access to 

compounded products. 

We received over 100 comments on this draft last week, so I understand there are ways to improve and clarify the proposal. We 

want to work with stakeholders to improve the bill. One provision 

that I look forward to discussing is the ability of the FDA to designate product categories and bulk materials as not suitable for 

compounding. We received comments that this authority undermines State regulation of traditional pharmacy, and I want to 

make sure that we clarify how and when these authorities can be 

used. 

Tennessee recently passed a law allowing office use of certain 

compounded products. I do not want this bill to change how Tennessee chooses to regulate its traditional compounding pharmacies. 

I look forward to discussing how the authorities for the FDA would 

complement the State approaches, how to improve State and FDA 

coordination, and some other provisions with our first witness, 

Janet Woodcock from the FDA. I also want to thank her for all the 

time her staff has put into this discussion. If they had been on top 

of it a year ago we may not be in this situation, but I’m glad the 

Agency is working with us now. 

We received lots of comments on how hospitals should be treated 

under this proposal, and I look forward to a good discussion with 

Dr. Kasey Thompson on our second panel on how to ensure quality 

products in every care setting. 

Last, I want to thank everyone who took the time last week to 

comment and read the bill. I believe we all share the same goal 

that each patient should be able to access the product prescribed 

by his or her doctor, and have assurance that the product is made 

to a suitable quality standard. To ensure safe compounding and 

manufacturing practices, we must be clear about who is accountable for regulating those practices. 

The CHAIRMAN. Thank you, Senator Alexander. 

Senator Mikulski has to recuse herself as the chair of the Appropriations Committee. She has to go and work to get our allocations 

and get our appropriations bills in line. And since she’s been so 

much involved in this effort, and so much of this takes place in her 

State with the FDA and others, I yield to Senator Mikulski. 

6 

STATEMENT OF SENATOR MIKULSKI

Senator MIKULSKI. Just a few quick words, Mr. Chairman. 

Thank you. I’m not recusing myself. I’m excusing myself. Recuse 

acts like I’m a party to the bad part of the situation. 

[Laughter.] 

Let’s not parse recuse, excuse. The fact is there’s no excuse if we 

don’t act on this legislation. And I’d like to compliment you, Mr. 

Chairman, and Senator Alexander for the bipartisan way that 

you’ve led this committee to come up with this solution. 

It is, indeed, a dire problem. My own State was affected—26 confirmed cases, three deaths. The Maryland General Assembly acted, 

but as our Commissioner of Health and Governor said, a State solution requires a national solution. I’m going to continue to work 

with you, because we need prevention, which will be the legislative 

framework. We need enforcement, which is how we make sure FDA 

is funded to do the job with the kind of accountability that you and 

Senator Alexander talk about. 

I will be excusing myself so we can work to begin to get our appropriations allocations done so the subcommittees can do their 

work. So forward together. I’ll leave at the conclusion of Dr. 

Woodcock’s testimony. 

The CHAIRMAN. Thank you, Senator. You’re excused but never 

recused. I got that. 

Apart from the normal procedure—usually, the procedure of this 

committee is always Chair and Ranking Member. But because this 

basically is his bill and it’s one that he’s been involved in for so 

long, I’m going to ask the indulgence of the committee to recognize 

for 5 minutes or so the Senator from Kansas, Senator Roberts. 

STATEMENT OF SENATOR ROBERTS

Senator ROBERTS. Well, thank you, Mr. Chairman. First, let me 

say that I’ve never known the distinguished Senator from Maryland to recuse herself from anything. I affectionately call the Senator Princess Leia. On occasion, she calls me Luke. But she is a 

Jedi Knight, and she will go do her very best in her role on the 

Appropriations Committee. 

Mr. Chairman, I just have a very brief opening statement, and 

then during the questioning, if you would grant me some extra 

time to clear up some misinformation on this bill that’s out there— 

unfortunately, the same folks that were active to prohibit our efforts to address the compounding issue in 2002 and 2007 are back 

at it again. 

And I think that’s most unfortunate, and I want everyone listening, everyone here in this committee room—and I know all of my 

colleagues know this—to know that our legislation does not prohibit access to lifesaving medication and therapies for patients. 

And it does everything, everything, to ensure an open and transparent process to make sure that doesn’t happen. 

I know every member on this committee wants more transparency with regards to any bill and a process to make sure that 

that doesn’t happen. I would yield back my time at this point. 

When we have time for questions, there are several myths I would 

like to clear up with what I think is factual information. All witVerDate Nov 24 2008 12:52 Mar 18, 2016 Jkt 000000 PO 00000 Frm 00010 Fmt 6633 Sfmt 6601 S:\DOCS\97957.TXT DENISE
7 

nesses and all those present, there will be a test after my comments and after we adjourn, and the penalty for not understanding 

this will be to go to Dodge City where you’ll be hung by the neck 

until you are dead. 

[Laughter.] 

The CHAIRMAN. All right. Proceeding on—— 

[Laughter.] 

The CHAIRMAN [continuing]. Our first witness is Dr. Janet 

Woodcock, Director of the FDA’s Center for Drug Evaluation and 

Research, called CDER. Under Dr. Woodcock’s direction, CDER 

evaluates and monitors the safety and effectiveness of drugs, helps 

provide doctors and patients with the information they need to 

make wise decisions about medication use and takes action against 

products that are unapproved, contaminated, or fraudulent. 

Dr. Woodcock joined the FDA in 1986 and previously served as 

FDA’s Deputy Commissioner and Chief Medical Officer. She has 

led many of FDA’s drug initiatives such as the introduction of risk 

management to drug safety and the modernization of drug manufacturing. Dr. Woodcock testified at our hearing earlier last year. 

We welcome you back again, Dr. Woodcock. Your statement will 

be made a part of the record in its entirety. Please proceed as you 

desire. 

STATEMENT OF JANET WOODCOCK, M.D., DIRECTOR, CENTER 

FOR DRUG EVALUATION AND RESEARCH, FOOD AND DRUG 

ADMINISTRATION, U.S. DEPARTMENT OF HEALTH AND 

HUMAN SERVICES, SILVER SPRING, MD 

Dr. WOODCOCK. Thank you, Mr. Chairman, Ranking Member, 

and members of the committee. We’re here because of an appalling 

tragedy that resulted from tainted medicine that was given to 

unsuspecting patients. It’s unbelievable that this happened in the 

21st century. This tragedy was only the worst in a series of outbreaks involving compounded products over the past decade, a 

large series of outbreaks. 

In retrospect, FDA, we think, should have been more aggressive 

in applying our existing authorities to this industry, in spite of the 

ambiguous statute and multiple challenges by industry. We are 

being more aggressive now. We’re inspecting pharmacies that we 

know about that we think pose the highest risk, and we’re seeing 

serious quality issues at these pharmacies. 

Even in the light of recent events, some of these firms are actually challenging our authority, delaying or denying full access to 

their records. Twice, we’ve had to get administrative warrants from 

the courts and have U.S. marshals accompany our inspectors in 

order to get into the facilities. We’ve had to threaten warrants in 

other cases to get cooperation from these facilities. 

Just because we’re inspecting doesn’t mean we will succeed in 

getting them to comply. Lack of clarity in our statutory authorities 

is not the only concern. The current legal framework is the wrong 

fit for this industry, which has evolved and grown tremendously 

over the past 12 years and really wouldn’t be recognizable as a traditional pharmacist of, say, 25 years ago. 

Make no mistake. I’m here to tell you that in the absence of 

changes, these tragedies will happen again. There is no doubt of 

8 

this. Since the NECC outbreak, we have found fungal organisms in 

additional compounded products, some of which were about to be 

given to patients and were only stopped by alert health personnel 

before they were actually administered to cancer patients. That’s 

why the work you’re doing to draft legislation is so critically important. We must have changes or this is going to happen again. 

The draft the committee released last week would give us really 

important new oversight tools that would better protect the public. 

For the very highest risk products, the ones implicated in most of 

these outbreaks, it would require Federal registration so we know 

who the compounders are, where they are, and what they’re making. It would require compliance with Federal quality standards 

and require reporting to FDA of serious adverse events so we can 

act before these potential problems really get out of hand. 

It would provide us with clear authority to inspect records and 

would require clear labeling of compounded drugs to allow prescribers and consumers to make more informed choices. In fact, 

we’ve heard from prescribers. They had no idea where these drugs 

really were coming from and that there might be additional risks. 

For all compounders, it would allow us to prohibit compounding 

of the most complex, high-risk drug products and to restrict the 

starting materials that could be used to those that are known to 

have high quality. We also appreciate that the draft would provide 

funding to help defray the cost to us of these additional oversight 

activities. 

We are concerned, however, about a couple of things. As currently drafted, the bill might blur the line between a compounding 

manufacturer and a conventional manufacturer. Those conventional manufacturers’ products must undergo FDA review and approval before marketing, and this could create incentives on the 

other side for those types of firms to try to slip into being considered a compounding manufacturer. 

In addition, the discussion draft does not provide us clear access 

to records of all firms engaged in compounding. This is critical to 

our effectively investigating outbreaks and also determining whether a firm is posing as a traditional compounder or actually is a 

compounding manufacturer, and to determine whether traditional 

compounders are violating any other Federal requirements that the 

discussion draft places on all compounders, including prohibition of 

compounding of certain drugs that are very risky. 

So let me reiterate the importance of the bill that you’re working 

on and the importance of your efforts. If, in fact, action is not 

taken, this will happen again. It’s really not a matter of whether. 

It’s a matter of when. So we want to keep working with you. We 

really commend you. This bill is a huge step in the right direction, 

and we hope that our testimony will help clarify any existing 

issues. 

Thank you. 

[The prepared statement of Dr. Woodcock follows:] 

PREPARED STATEMENT OF JANET WOODCOCK, M.D. 

INTRODUCTION

Mr. Chairman and members of the committee, I am Dr. Janet Woodcock, Director 

of the Center for Drug Evaluation and Research at the Food and Drug AdministraVerDate Nov 24 2008 12:52 Mar 18, 2016 Jkt 000000 PO 00000 Frm 00012 Fmt 6633 Sfmt 6621 S:\DOCS\97957.TXT DENISE
9 

tion (FDA or the Agency), which is part of the Department of Health and Human 

Services (HHS). Thank you for the opportunity to be here today to discuss important 

issues related to pharmacy compounding. We appreciate the leadership this committee has shown in drafting legislation to try to address the limitations and ambiguities in current law. 

We are at a critical point where we must work together to improve the safety of 

drugs produced by compounding pharmacies. As the compounding industry has 

grown and changed, we have seen too many injuries and deaths over many years 

caused by unsafe practices. Dr. Margaret Hamburg, Commissioner of Food and 

Drugs, testified in front of this committee on November 15, 2012, soon after the 

emergence of a tragic fungal meningitis outbreak associated with compounded 

methylprednisolone acetate (MPA), a steroid injectable product distributed by the 

New England Compounding Center (NECC). To date, that outbreak has been associated with 55 deaths and over 740 people sickened in 20 States. Sadly, NECC was 

not an isolated incident. Indeed, over the past 20 years we have seen multiple situations where compounded products have caused deaths and serious injuries. For example: 

• In 1997, two patients were hospitalized with serious infections after administration of contaminated riboflavin injection prepared by a Colorado pharmacy. 

• In 2001, 13 patients in California were hospitalized and 22 received medical 

care following injections from contaminated vials of a steroid solution. Three patients died as a result. 

• In 2002, five patients in North Carolina suffered from fungal meningitis resulting from contaminated methylprednisolone acetate made by a South Carolina pharmacy. One person died. 

• In 2005, contaminated cardioplegia solution, made by a firm located in Maryland, resulted in five cases of severe system inflammatory infections; three of these 

patients died. In 2007, three people died from multiple organ failure after a Texas 

compounder sold superpotent colchicine that was as much as 640 percent the labeled strength. 

• In 2010, FDA investigated a cluster of Streptococcus endophthalmitis bacterial 

eye infections in patients who received injections of Avastin repackaged by a pharmacy in Tennessee. 

• In 2011, there were 19 cases of Serratia marcescens bacterial infections, including nine deaths, associated with contaminated total parenteral nutrition products. 

• In 2012, 43 patients developed fungal eye infections from contaminated sterile 

ophthalmic drug products. At least 29 of these patients suffered vision loss. 

• Recently, in 2013, FDA investigated reports of five cases of eye infections in patients who received Avastin repackaged by a pharmacy in Georgia. The Avastin was 

contaminated with bacteria. 

These incidents are emblematic of long-standing issues associated with the practice of compounding and the public health concerns that can result from unsafe 

practices in compounding pharmacies. 

Since the NECC outbreak, nine additional firms have voluntarily recalled sterile 

compounded or repackaged drug products through FDA as of May 6, 2013. In one 

very recent incident, the presence of floating particles, later identified to be a fungus, was reported in five bags of magnesium sulfate intravenous solution, resulting 

in a nationwide recall of all sterile drug products produced by the pharmacy (over 

100 products). Fortunately, we have not received reports of patient injury from these 

products. In another recent recall, all sterile drug products (approximately 60 products) from a second pharmacy were recalled as a result of reports that five patients 

were diagnosed with serious eye infections associated with the use of repackaged 

Avastin. Moreover, we believe that presently, there are hundreds of other firms operating as compounding pharmacies, producing what should be sterile products and 

shipping across State lines in advance of or without a prescription. However, the 

current legal framework does not provide FDA with the tools needed to identify and 

adequately regulate these pharmacies to prevent product contamination. 

The history of this issue shows that there is a need for appropriate and effective 

oversight of this evolving industry. It is clear that the industry and the health care 

system have evolved and outgrown the law, and FDA’s ability to take action against 

compounding that exceeds the bounds of traditional pharmacy compounding and 

poses risks to patients has been hampered by limitations and ambiguities in the 

law, which have led to legal challenges to FDA’s authority to inspect pharmacies 

and take appropriate enforcement actions. 

The fungal meningitis outbreak has caused the Agency to review our past practices with regard to our oversight of compounding pharmacies, and has led to some 

preliminary conclusions. 

10 

1 A form FDA–483 is issued when investigators observe any significant objectionable conditions. It does not constitute a final Agency determination of whether any condition is in violation 

of the Federal Food, Drug, and Cosmetic Act (FD&C Act) or any of our relevant regulations, 

but the observations often serve as evidence of a violation of the FD&C Act and its implementing regulations. 

In my view, even in the face of litigation and continuous challenges by industry 

to our authorities, we can nonetheless be more aggressive in pursuing enforcement 

actions against compounding pharmacies within our current limited authority. I can 

assure you that we are being more aggressive now. We have established an agencywide steering committee to oversee and coordinate our efforts, and we have taken 

several important steps to identify and inspect high-risk pharmacies that are known 

to have engaged in production of sterile drug products. 

Using a risk-based model, we identified 29 firms for priority inspections focused 

on their sterile processing practices. During these 29 inspections, in two instances, 

FDA identified secondary firms associated with the priority inspections, for a total 

of 31 firms. We have taken investigators who would normally be doing inspections 

of conventional drug manufacturers and assigned them to conduct inspections of 

those pharmacies whose history suggests a greater risk of potential quality issues 

with their compounded products. We have coordinated our inspections with State officials, who have accompanied our investigators in most cases. At the same time, 

we have also continued to conduct for-cause inspections, often at the request of our 

State counterparts who invited us to accompany them on the inspections. Since the 

fall, FDA has conducted 26 for-cause inspections in addition to the 31 described 

above. When we identified problems during any of the inspections, at the close of 

the inspection, we issued an FDA Form 483 1 listing our inspection observations. We 

have issued an FDA–483 at the close of 47 of the 57 inspections we have conducted 

since last fall. We have seen some serious issues, including quality concerns that 

have led to product recalls. Observations have included: lack of appropriate air filtration systems, insufficient microbiological testing, and other practices that create 

risk of contamination. 

Notably, even in light of recent events, and even though we are often working 

with the State inspectors, our investigators’ efforts are being delayed because they 

are denied full access to records at some of the facilities they are inspecting. Just 

during the recent inspections, several pharmacies delayed or refused FDA access to 

records, and FDA had to seek administrative warrants in two cases. And although 

we have been able to eventually conduct the inspections and collect the records that 

we have sought, our ability to take effective regulatory action to obtain lasting corrective action with regard to substandard sterility practices remains to be seen. 

As we have noted in the past, our ability to take action against inappropriate 

compounding practices has been hampered by ambiguities regarding FDA’s enforcement authority, legal challenges, and adverse court decisions, and we have learned 

that the law is not well-suited to effectively regulate this evolving industry. For example, hospitals have come to rely on compounding pharmacies that function as 

‘‘outsourcers’’ producing sterile drugs previously made by hospital in-house pharmacies. If FDA brings charges against a pharmacy, alleging that it is manufacturing 

a ‘‘new drug’’ that cannot be marketed without an approved application, the pharmacy will have to either obtain individual patient-specific prescriptions for all of its 

products or stop distributing the products until it obtains approved new drug applications for them, something most outsourcers are unlikely to do. Several of the 

pharmacies FDA inspected are some of the largest outsourcers in the country. These 

pharmacies supply large numbers of sterile drugs produced in relatively large quantities to hospitals nationwide, and a shut-down at these firms is likely to cause disruptions in the supply of drugs to hospitals and other health care providers. FDA 

should have more tailored authorities appropriate for this type of compounding 

pharmacy. 

In the Commissioner’s last appearance before this committee, she presented a 

framework that could serve as a basis for the development of a risk-based program 

to better protect the public health, improve accountability, and provide more appropriate and stronger tools for overseeing this evolving industry. We have since met 

with over 50 stakeholder groups, including pharmacy, medical, hospital, payer, and 

consumer groups, and State regulators, to help further our understanding and inform our framework. Today, I will first provide background on FDA’s current legal 

authority over compounded drugs, then provide additional details about the framework, and suggest specific actions that Congress can take to help us better do our 

job and prevent future tragedies like this one. 

11 

2 H.R. 5256, Pharmacy Compounding Preservation Act of 1994, introduced Oct. 7, 1994, 1 cosponsor; H.R. 598, Pharmacy Compounding Preservation Act of 1994, introduced Jan. 20, 1995, 

141 cosponsors; H.R. 3199, Drug and Biological Products Reform Act of 1996, introduced March 

29, 1996, 205 cosponsors; H.R. 1060, Pharmacy Compounding Act, introduced March 13, 1997, 

152 cosponsors; H.R. 1411, Drug and Biological Products Modernization Act of 1997, introduced 

April 23, 1997, 16 co-sponsors. 3Public Law 105–115, FDAMA, 111 Stat. 2296 (Nov. 21, 1997), available at http:// 

www.gpo.gov/fdsys/pkg/PLAW–105publ115/pdf/PLAW–105publ115.pdf. 4 Id. 

FDA’S LEGAL AUTHORITY OVER COMPOUNDED DRUGS

FDA regards traditional pharmacy compounding as the combining or altering of 

ingredients by a licensed pharmacist, in response to a licensed practitioner’s prescription for an individual patient, which produces a medication tailored to that patient’s special medical needs. In its simplest form, traditional compounding may involve reformulating a drug, for example, by removing a dye or preservative in response to a patient allergy. It may also involve making an alternative dosage form 

such as a suspension or suppository for a child or elderly patient who has difficulty 

swallowing a tablet. FDA believes that pharmacists engaging in traditional 

compounding provide a valuable medical service that is an important component of 

our health care system. However, by the early 1990s, some pharmacies had begun 

producing drugs beyond what had historically been done within traditional 

compounding. 

After receiving reports of adverse events associated with compounded medications, 

FDA became concerned about the lack of a policy statement on what constituted appropriate pharmacy compounding. In March 1992, the Agency issued a Compliance 

Policy Guide (CPG), section 7132.16 (later renumbered as 460.200) to delineate 

FDA’s enforcement policy on pharmacy compounding. It described certain factors 

that the Agency would consider in its regulatory approach to pharmacies that were 

producing drugs. 

The compounding industry objected to this approach and several bills were introduced, some with significant support, to limit the Agency’s oversight of compounding.2 In November 1997, S. 830, the Food and Drug Administration Modernization Act of 1997 (FDAMA), was signed into law as Public Law 105–115. 3 FDAMA 

added section 503A to the FD&C Act, to address FDA’s authority over compounded 

drugs. 4 Section 503A exempts compounded drugs from three critical provisions of 

the FD&C Act: the premarket approval requirement for ‘‘new drugs’’; the requirement that a drug be made in compliance with current good manufacturing practice 

(cGMP) standards; and the requirement that the drug bear adequate directions for 

use, provided certain conditions are met. These provisions were the subject of subsequent court challenges, which have produced conflicting case law and amplified the 

perceived limitations and ambiguity associated with FDA’s enforcement authority 

over compounding pharmacies. In 2002, immediately after a Supreme Court ruling 

that invalidated the advertising provisions of section 503A, FDA issued a revised 

compliance policy guide on compounding human drugs. Several additional legal 

challenges and court decisions then followed. More recently, FDA made significant 

progress toward issuing another CPG. In fact, FDA was on track to publish a revised draft CPG in the fall of 2012, but the fungal meningitis outbreak intervened 

and we are now reevaluating the draft. It is important to note, however, that a CPG 

is not binding on industry and updating the CPG would not alleviate all issues with 

section 503A. 

A look at FDA’s attempts to address compounding over the last 20 years shows 

numerous approaches that were derailed by constant challenges to the law. As a result, presently, it is unclear where in the country section 503A is in effect, and section 503A itself includes several provisions that have impeded FDA’s ability to effectively regulate pharmacy compounding practices including those relating to prescription orders, medical need, and copying FDA-approved products. 

Apart from section 503A, there are additional provisions in the statute that have 

impeded effective pharmacy compounding regulation. For example, if certain criteria 

are met, the FD&C Act exempts compounding pharmacies from registration and the 

obligation to permit access to records during an inspection. As a result, FDA has 

limited knowledge of pharmacy compounders and compounding practices and limited ability to oversee their activities. 

LOOKING AHEAD

The Administration is committed to working with Congress to address the threat 

to public health from limitations in authorities for effective oversight of certain 

12 

compounding practices. To that end, FDA has developed a framework that could 

serve as the basis for the development of a risk-based program to protect the public 

health. 

RISK-BASED FRAMEWORK

Recognizing the history of compounding practice, FDA supports the long-standing 

policy that all compounding should be performed in a licensed pharmacy by a licensed pharmacist (or a licensed physician), and that there must be a medical need 

for the compounded drug. 

Further, we believe there should be a distinction between two categories of 

compounding: traditional and non-traditional. Traditional compounding would include the combining, mixing, or altering of ingredients to create a customized medication for an individual patient with an individualized medical need for the compounded product, in response to a valid patient-specific prescription or order from 

a licensed practitioner documenting such medical need. Traditional compounding, 

while posing some risk, plays an important role in the health care system, and 

should remain the subject of State regulation of the practice of pharmacy. 

Non-traditional compounding would include certain types of compounding for 

which there is a medical need, but that pose higher risks. FDA proposes working 

with Congress to define non-traditional compounding based on factors that make the 

product higher risk such as any sterile compounding in advance of or without receiving a prescription, where the drug is distributed out of the State in which it was 

produced. Non-traditional compounding would be subject to Federal standards adequate to ensure that the compounding could be performed without putting patients 

at undue risk, and FDA would inspect against and enforce these Federal standards. 

Such a definition focuses on the highest risk activities and offers a uniform degree 

of protection across all 50 States, for highest-risk compounding activities. 

Non-traditional compounding should, because of the higher risk presented, be subject to a greater degree of oversight. Sterile products produced in advance of or without a prescription and shipped interstate should be subject to the highest level of 

controls, established by FDA and appropriate to the activity, similar to cGMP standards applicable to conventional drug manufacturers. 

In addition, FDA believes that with noted exceptions, certain products are not appropriate for compounding under any circumstances. These products would include: 

(1) what are essentially copies of FDA-approved drugs, absent a shortage justification based on the drug appearing on FDA’s shortage list; and (2) complex dosage 

forms such as extended release products; transdermal patches; liposomal products; 

most biologics; and other products as designated by FDA. Producing complex dosage 

forms would require an approved application and compliance with cGMP standards, 

along with other requirements applicable to manufactured drug products. 

FDA believes that there are other authorities that would be important to support 

this new regulatory paradigm. For example, FDA should have clear ability to collect 

and test samples of compounded drugs and to examine and collect records in a 

compounding pharmacy, just as the Agency does when inspecting other manufacturers. FDA should also have clear ability to examine records such as records of prescriptions received, products shipped, volume of operations, and operational records 

such as batch records, product quality test results, and stability testing results. 

Such inspections are necessary to determine when a pharmacy exceeds the bounds 

of traditional compounding, to respond to public health threats, and to enforce Federal standards. 

FDA also believes that an accurate inventory of pharmacies engaged in non-traditional compounding would facilitate appropriate oversight and coordination with 

State regulators. In addition, FDA looks forward to working with the Congress on 

potential improvements that may include label statements and adverse event reporting that have proven useful in other areas. A user-fee-funded regulatory program may be appropriate to support the inspections and other oversight activities 

outlined in this framework. We look forward to working with Congress to explore 

the appropriate funding mechanisms to support this work, which could include registration or other fees, as Congress has authorized and FDA has successfully implemented in other settings. 

CONCLUSION

Given our experiences over the past 20 years and the recent fungal meningitis 

outbreak, we must do everything we can to clarify and strengthen FDA’s authority 

in this area. We appreciate the bipartisan efforts of the committee to clarify the law 

regarding the oversight of compounding pharmacies and look forward to the opporVerDate Nov 24 2008 12:52 Mar 18, 2016 Jkt 000000 PO 00000 Frm 00016 Fmt 6633 Sfmt 6621 S:\DOCS\97957.TXT DENISE
13 

tunity to work with the committee to address remaining issues. Thank you for your 

leadership in taking this important first step. 

I am happy to answer any questions you may have. 

The CHAIRMAN. Thank you, Dr. Woodcock, and your suggestions 

are, believe me, under serious consideration. We’ll take those into 

account as we refine and put this bill together. I think they’re great 

suggestions, and, as I said, we’ve discussed those recently. Hopefully, we’ll be able to incorporate those in the draft. 

Let me just ask a few questions, and you touched on this. But 

just develop a little bit more about keeping traditional manufacturers from deciding to become a compounding manufacturer, because 

you said that might happen. What could we do to ensure against 

that? 

Dr. WOODCOCK. We had advised that any compounding manufacturer would also have to hold a pharmacy license in the State in 

which they were located. And I understand the reason for not doing 

that was to make the flagpole clear. 

However, the evolving industry is really doing pharmacy operations. To a great extent—and I’m sure you’ve heard from the hospitals—hospitals are outsourcing their pharmacy operations. Clinics, pain clinics, as well as many other clinics that maybe are now 

office buildings—they don’t have a pharmacy located in their office 

building, so they buy these products from a pharmacy, right now 

a compounding pharmacy. 

These are regular pharmacy operations, most of the operations 

that are being done. And I think having the State board oversee 

that, requiring that to be a pharmacy, clearly distinguishes that 

from a drug manufacturer that is an entity that really has to apply 

for an application for each—an NDA to market any given product. 

So there has to be a clear separation, we think. 

Also, those personnel in the compounding manufacturers should 

have appropriate qualifications for pharmacy operations, which 

means pharmacists, pharmacy technicians. The States oversee 

much of that. They license pharmacists in their States. 

The CHAIRMAN. Very good. Thank you. How important is it that 

this legislation be effective immediately upon enactment? If we 

pass this bill with, say, a transition period or a delayed effective 

date, would that compromise your current efforts at overseeing 

pharmacy compounding? 

Dr.. WOODCOCK. We feel there would have to be a delayed effective date. That would be the most appropriate. We could work on 

guidance for the industry, those who would be moving into the 

compounding manufacturing status, about what they would have to 

comply with. 

The CHAIRMAN. So you’re saying it shouldn’t be effective immediately. 

Dr. WOODCOCK. We think that would cause disruption if all of it 

were effective immediately. And we would be happy to work with 

you on how that could be set up. 

The CHAIRMAN. If we delayed it, that would not compromise your 

efforts at overseeing? 

Dr. WOODCOCK. We would continue to do what we’re doing now, 

aggressively—— 

The CHAIRMAN. What we’re doing now is not effective. 

14 

Dr. WOODCOCK. What we’re doing now is—we would inspect and 

enforce standards for human safety, all right, according to our current statute. It is complicated, and I think we should work with 

you on this. 

The CHAIRMAN. I’d like to work with you on that, because I’m not 

certain that we see eye to eye on this one. I just think that a delayed period creates a lot of problems, but we’ll be glad to discuss 

that. 

Let me ask you this. Does the draft provide the FDA the tools 

it needs, in terms of both authorities and resources, to oversee 

pharmaceutical compounding? 

Dr. WOODCOCK. The user fee proposal that’s in there, or the fee 

proposal, would probably provide about, we estimate, 60 percent of 

the resources that would be needed, and we really appreciate the 

committee putting that in. We recognize that right now, the resources to do this are primarily coming from our inspectors who inspect the traditional drug industry, both the generics and the innovator, and so, over the long term, that would decrease our effectiveness. 

As far as the provisions, as I said, we would like to have broader 

records authority than what is put in the bill right now, because 

we feel we really need to get into pharmacies to make sure they’re 

not posing as traditional pharmacies or they’re not committing 

practices that are forbidden under the legislation. 

But, particularly, if there’s an outbreak, we have reports, and we 

go in, and they say, ‘‘No, you can’t come into our pharmacy.’’ And 

we need to find out who they’ve shipped to. We need to get samples 

and test them. And so not having the ability to look at their 

records and so forth could, in an outbreak, impede our ability to 

protect the public health. 

The CHAIRMAN. That’s an area that we’re really going to have to 

look at, too, and that’s accessibility of records. 

My time is up. I’ll turn to Senator Alexander. 

Senator ALEXANDER. Thanks. 

Dr. Woodcock, it seems to me the most important thing about 

this bill is the new category, compounding manufacturer. To me, 

clarity is what I’m—the flagpole is what I’m looking for. And a 

compounding manufacturer would be one that makes a sterile 

product in advance of a prescription and sells it across a State line. 

So if you do that, you’re in that category. Right? Is that the way 

you understand it? 

Dr. WOODCOCK. Yes. 

Senator ALEXANDER. And then the compounding manufacturer 

would be inspected by and registered and list their products with 

the FDA. 

Dr. WOODCOCK. That’s correct. 

Senator ALEXANDER. Now, what we’re recommending—the draft 

recommendation—is that you be totally in charge of that facility, 

that you be on the flagpole for that facility. But your testimony 

suggests that the State have some role, too. Doesn’t that just leave 

us where we are, which is confusion between what the State—can’t 

you then say, ‘‘Well, the State should have done that,’’ and they can 

say, ‘‘Well, I thought the FDA was doing it’’? 

15 

Dr. WOODCOCK. No. We would take full responsibility. However, 

we feel that this is a pharmacy operation. It’s almost like a Federal 

pharmacy operation. In some sense, it is a pharmacy operation, because what would keep a traditional manufacturer—if they don’t 

have to be a pharmacy, then they can say they’re a compounding 

pharmacy and begin to make perhaps unapproved drugs. 

So the rationale for this third category is really that these are 

pharmacies that are doing operations that are beyond the scope of 

ordinary pharmacy practice—— 

Senator ALEXANDER. Right. 

Dr. WOODCOCK [continuing]. And really need Federal intervention. But they still are pharmacies. They’re still doing pharmacy 

operations. 

Senator ALEXANDER. Well, the bill requires that they have a licensed State pharmacist in there. 

Dr. WOODCOCK. Yes. 

Senator ALEXANDER. But why shouldn’t—I mean, that’s confusing to me. It seems to me that it’s important for a facility to 

know that if I make a sterile product in advance of a prescription 

and I sell it across the State line, I’ve got one regulator, and that 

regulator is the FDA, period. And then the doctor knows that, the 

customer knows that, the patient knows that—everybody knows, 

and the FDA knows that, that it’s your job to make sure that place 

is safe. 

Dr. WOODCOCK. And we agree that we would take full responsibility, that the registration and listing provisions that you’ve put 

in the bill enable us to know who those folks are and—— 

Senator ALEXANDER. But then why do you need to have the State 

involved? 

Dr. WOODCOCK. Well, it’s on the other side, like the people who 

are traditional manufacturers, which distinguishes this facility 

from any—— 

Senator ALEXANDER. Traditional manufacturers or pharmacists? 

Dr. WOODCOCK. Traditional manufacturers. It’s the other side. 

It’s not the pharmacy that is—— 

Senator ALEXANDER. Well, you regulate traditional manufacturers. 

Dr. WOODCOCK. We do. Well, I believe we could have more conversation about this. I understand—— 

Senator ALEXANDER. I just think—to me, it’s very important. I 

mean, I think Admiral Rickover was onto something, and we could 

probably apply it in a lot more aspects of the Federal Government. 

Just in my human experience, I’ve discovered that if it’s absolutely 

clear who’s on the flagpole, who’s in charge, that reduces the risk 

of failure, and it improves the chances of success. I’m more comfortable with your being in charge of compounding manufacturers, 

just like you are with traditional manufacturers, so there’s no confusion. 

If I could ask one other question, the draft bill includes an exemption to the compounding manufacturer category for interstate 

shipments within a hospital system. Now, could you comment on 

why you believe interstate shipments of sterile products within 

hospital systems don’t pose the same public health risks as other 

compounders? 

16 

Dr. WOODCOCK. They pose certain risks, and, certainly, intrastate shipment of sterile products and sterile products that are 

used intra-state alone pose certain risks. And, certainly, non-sterile 

products have caused deaths. So making medicines and shipping 

them around is not without risk. We’ve tried to pick the highest 

risk category, which is where a manufacturer not associated with 

taking care of the patients is manufacturing sterile products and 

shipping them all around to other entities. 

Senator ALEXANDER. But why would—— 

Dr. WOODCOCK. A hospital system is already in charge of their 

patients, and they may wish to centralize their pharmacy operations. But if they had a pharmacy operation, say, in one State, 

within that hospital system, they would be doing that and giving 

it to their own patients. So they already have responsibilities for 

the care and safety of their patients within their hospital system. 

Senator ALEXANDER. What if they contract that out? What if the 

hospital system contracts that out? 

Dr. WOODCOCK. If they contract it out, then it’s to a different entity, and if that entity is shipping intra-state, then that is a 

compounding manufacturer. 

Senator ALEXANDER. If they contract it out, it becomes outside 

the exemption, and they’re regulated by the FDA. 

Dr. WOODCOCK. That is correct, and that is what much of these 

operations are. They’re outsourcing operations that once occurred 

in the hospital pharmacy to sort of—— 

Senator ALEXANDER. But if Vanderbilt Hospital has its own—— 

Dr. WOODCOCK. Hospital pharmacy. 

Senator ALEXANDER [continuing]. Hospital pharmacy, then all 

the parts of the Vanderbilt Hospital is exempt from this. 

Dr. WOODCOCK. That’s correct. 

Senator ALEXANDER. If it contracts it out to the Harkin, Incorporated, then Harkin or Alexander are regulated by the FDA. 

Dr. WOODCOCK. That’s how we understand the current proposal, 

and that’s what we would agree with. 

The CHAIRMAN. I hope we make that clear in our draft. Thank 

you very much. 

In order, I have Senator Warren, Senator Roberts, Senator Mikulski—no, she’s not—Senator Enzi, Senator Murphy, Senator 

Baldwin. 

Senator Warren. 

STATEMENT OF SENATOR WARREN

Senator WARREN. Thank you, Mr. Chairman. As the senior Senator from Massachusetts, I feel a special duty to ensure that we do 

everything possible to protect people from unsafe drugs. Massachusetts was home to the New England Compounding Center, the 

compounding pharmacy that was responsible for the fungal meningitis outbreaks that killed 53 people and made 733 people sick. 

This outbreak was in part the result of longstanding failures in 

government regulation at both the State and Federal levels, a lack 

of coordination between State and Federal oversight, and a lack of 

clarity in the existing regulations. 

This unregulated industry is not a Massachusetts problem. It is 

a national problem. The current state of our oversight of the 

17 

compounding industry is outdated and inadequate. And as the data 

make clear, it represents a continuing threat to public health. I 

take this threat seriously. Those drugs can go anywhere, and a patient has no way to assess the safety of the pills that a pharmacist 

hands out or the drugs that a doctor injects into a patient. 

People count on us to put laws in place that will protect our citizens from this sort of harm. This is one of the most basic functions 

of regulation. I think a lot of members of this committee recognize 

that. I’m very pleased that Democrats and Republicans on this 

committee have been able to come together over the last several 

months to develop this draft legislation. I’m pleased because we all 

agree that a tragedy like this should not happen again, that it can 

be prevented, and it’s our job to prevent it. 

So the question I want to understand—I want to get a little 

transparency behind this—is exactly the scope of the problem that 

we’re dealing with. We’ve all concentrated on the New England 

Compounding Center, and we should. It attracts our attention. But 

can you tell the committee, Dr. Woodcock, how many patients have 

been harmed by injury, by infection, or by death since 1997, when 

Congress first acted to prevent harms associated with 

compounding? 

Dr. WOODCOCK. Certainly. I think the real problem is we don’t 

know. Pew in their testimony today has a chart of known outbreaks and known deaths going back over a decade, and also other 

problems such as blindness, severe injuries, and so forth from compounded products. But because we don’t have an inventory or identification of these firms, and it’s difficult sometimes to detect the 

harm at an individual level, we actually don’t know. 

What we do know is that many of these practices that we have 

uncovered cannot assure sterility of the sterile products. I’d like to 

read from a recent hearing that New Jersey had, all right? 

Senator WARREN. Go ahead, Dr. Woodcock. 

Dr. WOODCOCK. This was from Dr. David Newton, who is an expert and a pharmacy professor, and he was chair of the Sterile 

Compounding Committee of USP numerous times. What he said 

was the following. He said that the statistical likelihood of contamination in a medium-risk sterile compounding environment is approximately 1 percent. That’s 1 in 100. 

Now, that’s tolerable if you’re in the basement of the hospital in 

the pharmacy there, and you send it right up to the floor, or you’re 

making it up right beside the patient, and you inject it right in the 

patient. But if these are made in mass quantities, and 1 percent 

of them may be contaminated, statistically, and they are shipped 

all around, and they’re put in inventory, and they’re sitting, this 

allows organisms to grow, and that’s kind of the root cause of this 

problem. 

We have grown multiple organisms out of samples we have taken 

when we’ve done these inspections of compounding pharmacies. 

Senator WARREN. Dr. Woodcock, I just want to push on a point. 

I very much appreciate that what you’re identifying is that there 

are some really bad practices out there, and the assumption is that 

those bad practices are causing illness, injury, and possibly even 

death. 

18 

The question I wanted to know the answer to is how much, and 

you’ve told me you don’t know. Why don’t you know? You’re the 

Federal Drug Administration. Why don’t you know how many people have been killed from these drugs? 

Dr. WOODCOCK. There is no requirement right now for registration and listing, which would be telling us who they are, where 

they are, and what they’re making. 

Senator WARREN. So no one has to tell you. 

Dr. WOODCOCK. No. 

Senator WARREN. What happens when you ask? 

Dr. WOODCOCK. Sometimes we can’t get their records, particularly their shipping records, and so doing investigations can be difficult or impeded by refusal to allow us access. 

Senator WARREN. So we’re here today because of one tragedy 

that became public. We don’t know how many other people have 

been made sick. We don’t know how many other people have died. 

Dr. WOODCOCK. We know there have been multiple other outbreaks and multiple other episodes of fatalities from compounded 

products. 

Senator WARREN. But, basically, the compounding industry 

doesn’t tell, and as long as they don’t tell, we don’t have the kind 

of public scrutiny that causes us to move forward with this kind 

of legislation. 

Thank you, Dr. Woodcock. I just want to say I think it’s unconscionable that we have failed to regulate this industry for so long 

and put the public at risk. I’m very much committed to working 

with you and with everyone on this committee to make sure that 

we put a stop to this. 

Thank you, Mr. Chairman. 

The CHAIRMAN. Thank you, Senator Warren. 

Senator Roberts. 

Senator ROBERTS. Thank you, Mr. Chairman, and my colleagues, 

and with your indulgence, I might go a little over time with what 

I hope is a factual response to some misinformation that I think 

is out there. I would remind the committee that way back in 

2002–3, we had a pharmacist in Kansas City, MO, who was diluting cancer drugs and selling them as if they were fully potent. That 

was exposed with the help of the Kansas City Star, by the way, 

and a young man named Mark Morris. 

He’s in prison now, and he’s serving time, and that was one of 

the reasons I got into this some 10 years ago. Lately, as the Senator from Massachusetts has indicated, we’ve had this tragedy with 

53 deaths and 700 illnesses. If anything, that really galvanized the 

committee, and I appreciate everybody’s participation and leadership. 

To address some specific information now being circulated, Myth 

No. 1: Under the proposal, traditional compounders would be subject to current good manufacturing practices—that’s called cGMP. 

That’s the acronym—the quality standards that apply to pharmaceutical manufacturers. 

Fact: Traditional compounders are exempt from cGMP requirements. The draft exempts traditional compounders from the cGMP 

requirements—read section 501(a)(2)(B); adequate directions for 

use, section 502(f)(1); and the new drug-approval requirement, secVerDate Nov 24 2008 12:52 Mar 18, 2016 Jkt 000000 PO 00000 Frm 00022 Fmt 6633 Sfmt 6601 S:\DOCS\97957.TXT DENISE
19 

tion 505 for human drugs and section 512 for animal new drug approvals. See page 5, lines 12 to 22. 

I think, everybody, if you wanted to write that down, we can certainly give that to you and proceed from there. 

Myth No. 2: The proposal prohibits the use of liposomal or transdermal products. 

This draft does not ban the compounding of any specific products. 

The proposal does direct the FDA to establish a list of products, 

however, that are too complex to currently be compounded. But 

that list will be developed through an open transparent regulatory 

process with input from stakeholders. 

I realize this kind of process may represent an endangered species in the overall regulatory process of the Federal Government. 

But with this committee, we’re going to conduct oversight and 

make sure that that happens. 

Myth No. 3: The proposal creates loopholes for pharmaceutical 

companies to manufacture new drugs without new drug applications, i.e., the NDAs. 

Fact: Under current law, compounded drugs are considered new 

drugs. As is true with all new drugs, the new drug application requirements apply unless an entity meets the criteria to be either 

a traditional compounder or a compounding manufacturer. Under 

the proposal, neither a traditional compounder nor a compounding 

manufacturer can make a product from a book unknown to USP— 

that’s the book that all the pharmacists use—or FDA and distribute it in an interstate commerce without an investigational new 

drug exemption, NDA or ANDA. 

Myth No. 4: The proposal creates a loophole for hospital compounding pharmacies that will allow them to compound outside of 

industry best practices. 

Fact: Hospital-based pharmacies are treated as traditional 

compounders under the proposal. They are subject to the same restrictions as other traditional compounders. Hospital-based compounding will continue under the exact same State Pharmacy 

Board, Joint Commission, and Center for Medicare and Medicaid 

Services standards that exist today. 

Myth No. 5: By categorizing all compounded drugs as new drugs, 

the burden will be so great that it is impractical to compound even 

to fill a specific prescription. 

Fact: Under current law, FDA already categorizes all compounded drugs as new drugs, and this proposal affirms that principle. The proposal exempts traditional compounders from the new 

drug approval requirements, cGMP standards, and adequate directions for use requirements so they are not subject to the major requirements applicable to most new drugs. Similarly, compounding 

manufacturers are exempt from the new drug approval requirements and the adequate directions for use requirements. 

Myth No. 6: The proposal prohibits traditional compounders near 

State lines to ship products interstate because of arbitrary boundaries. 

Fact: The traditional compounders can ship non-sterile products 

across State lines without receiving a prescription before 

compounding the product or ship any product, sterile or non-sterile, 

20 

across State lines if they receive a prescription before compounding. 

Myth No. 7: The proposal will make drug shortages worse. 

Fact: The proposal allows for compounding of products on the 

FDA drug shortage list. 

Myth No. 8: The proposed limits eliminates doctors’ options to 

prescribe the most beneficial treatment, in their medical opinion, 

for a patient. 

Fact: The day of enactment, FDA is directed to create a list of 

products too complex to compound. Only after a transparent and 

regulatory process, again, with a comment period for the public and 

doctors, can FDA add any product to that list. 

Finally, Myth No. 9: The proposal eliminates drug compounding 

for animals. 

Fact: The exemptions from new drug requirements for traditional 

compounders and compounding manufacturers apply to drugs compounded for humans and animals. The proposal allows 

compounding of animal drugs from FDA-approved products or from 

bulk chemicals subject to restrictions. Any FDA-approved product 

for either humans or animals can be compounded to treat the animal, except for drugs on the do-not-compound list established by 

the FDA. 

In addition, the FDA will establish a list of bulk chemicals that 

can be used to compound a drug for major species and food for animals while any bulk that meets USP standards can be used for 

minor species. 

I hope this clears up some misinformation that’s been out there, 

Mr. Chairman. I thank you for your indulgence. I’ll have additional 

questions for the panel. 

The CHAIRMAN. I want to thank you, Senator Roberts, for reading that list. I’ve had that before. My staff has informed me that 

over 2,000 e-mails have come in to Senators’ offices. One Senator— 

I don’t know that I need to mention his name—said that he alone 

got over 200 e-mails basically propounding all of these myths, that 

that was going to happen. 

So the same forces, as I say to my good friend from Kansas, that 

sunk your bill in 2007 are back out there again. So I appreciate 

your highlighting the myths and the facts that are in this bill. I 

thank you for that. 

Senator Enzi. 

STATEMENT OF SENATOR ENZI

Senator ENZI. Thank you, Mr. Chairman. The more I hear about 

this, the more confused I get. I thought that the FDA, the CDC, 

and the HMS has a pretty good system of locating things when 

they went awry. In fact, I remember a spinach outbreak that we 

had, and the three of them showed unusual—no, I think as we investigated, it was usual cooperation. And with as few as 20 cases 

spread over three States, they were able to isolate that there was 

a problem, and they were able to trace it back to the farm where 

it happened. 

I don’t understand how this one got so far out of hand before 

anything was discovered. But, at any rate, you’re reaching into a 

whole area here that boards of pharmacies, which are State-based, 

21 

have been operating on. Obviously, there was a breakdown in it, 

and if you say these other cases happened, there’s been a breakdown in that, too. 

But that’s kind of the people on the flagpole right now, those 

State boards of pharmacy. And they’re supposed to go into these 

records, and they ought to have the ability to let you know if somebody is a manufacturer. But it doesn’t seem like we need to expand 

the FDA operation in order to do what is already supposed to be 

done by the States. 

There are a lot of things that we give out primacy for. OSHA is 

one of them, and that saves the Federal Government having a lot 

of inspectors. But the Federal Government is very inefficient. They 

seem to be able to do about three inspections a month, and at that 

rate, it would take 500 years for them to get around to all the businesses. And I could see where, if we keep expanding FDA, we can 

run into that same kind of a problem. 

I do think these things need to be reported faster. I think that 

we ought to make sure that the people in the States are trained 

well to be able to tell whether it’s a manufacturing facility or 

whether they’re doing their normal thing. And pharmacists checking on pharmacists—I don’t think we have enough pharmacists in 

the whole United States. 

But could you clarify whether the FDA believes that under the 

draft bill, the compounding manufacturers should follow good manufacturing procedures, GMPs, or whether the FDA intends to establish new standards more appropriate for the scope and scale of 

their operations? 

Dr. WOODCOCK. We would intend if the bill is passed to establish 

specific requirements, similar to what we’ve done for positron emission tomography, where that’s a very specialized area, and we’ve 

put forth specific requirements. Those drugs have to be made with 

a cyclotron because they’re radioactive. We put forth very specific 

requirements, and that industry is operating under those requirements. We would hope to tailor, again, specific requirements to the 

issues raised by sterile compounding. 

Senator ENZI. And those aren’t just GMPs? 

Dr. WOODCOCK. GMPs have a very broad range of scope of all 

parts of drug manufacturing. For example, manufacturing 

compounders would not be doing drug synthesis or making new 

drugs sort of from scratch, which is what the generic and innovator 

industry does. 

Senator ENZI. So we’re going to have a new regulatory regime for 

large-scale drug compounders and establish new restrictions on 

what traditional pharmacists can and cannot compound. This new 

framework will require rulemaking, then. I think you just said 

that. The pharmacists in my State have commented that they hope 

the FDA will communicate any new requirements to them in a 

user-friendly manner. What Senator Roberts read wasn’t hardly 

user-friendly to me, but maybe it is to a pharmacist. 

Can you commit that the FDA will provide an open and transparent process for this rulemaking associated with the bill? And 

can you provide your thoughts on how we can make everyone 

aware of the products on the do-not-compound list? 

22 

Dr. WOODCOCK. Yes. We will have extensive public discussion 

and comments. We would propose to put out interim guidance on 

things so that people would understand. We work with the National Board of Pharmacies as well as with the States and the 

State Board of Pharmacies so that we can get out to the professional societies, and we can work with all the different associations 

of pharmacists. So we have many ways to get the word out. 

I can’t stress enough, though, that the industry we’re talking 

about regulating here with the Federal Government is not traditional compounding as people would have thought of it, say, 20 

years ago. It is very large scale and is not in response to individual 

prescriptions. 

We have long recognized at FDA the value of pharmacy 

compounding and the way it can tailor medications to different 

unmet medical needs. However, this industry has changed and 

grown up, so this is a new type of practice that has evolved. And 

it raises the stakes on risk, because they’re doing large-scale, sterile processing of drugs. 

And as I read earlier, the way it is being done now and the 

standards that apply, there is a finite chance of contamination. 

We’ve seen this contamination happen again and again and again. 

And this industry is not required to not only identify themselves 

to us, but submit adverse event reports if anything goes wrong. So 

we don’t have a good way with this new industry, this evolving industry, of finding out what’s going on with it. 

Senator ENZI. It seems like if we have a requirement for vitamin 

manufacturers to report adverse events—— 

Dr. WOODCOCK. We do. 

Senator ENZI [continuing]. That we certainly ought to do it for 

almost everything. I’ve used my time up. Sorry. 

The CHAIRMAN. Let’s see. Senator Murphy is not here. 

Senator Baldwin. 

STATEMENT OF SENATOR BALDWIN

Senator BALDWIN. Thank you, Mr. Chairman and Ranking Member. I appreciate the fact that you’re holding this hearing, and I 

want to thank you, in particular, for managing a very open process. 

I know that this committee has been working on this issue for 

many, many months now, even before I joined this committee, and 

that individuals on this committee have been working on this issue 

for many years, and I appreciate that work. There’s a very encouraging sense of an open and collaborative process, and everyone has 

seemed welcome at the table. 

Last year’s tragic meningitis outbreak underscored the importance of updating Federal compounding policy. And at the same 

time, compounded drugs are an important part of patient care. For 

some patients, these specially tailored drugs are the only medicines 

that can work effectively. It’s critical that patients continue to have 

access to these treatments, but it is also important to make sure 

that the compounded drugs that people count on are safe, and that 

our regulatory system does not allow bad actors to exploit loopholes 

and jeopardize patient safety. 

I believe this bipartisan draft proposal represents significant 

progress toward striking the right balance between patient safety 

23 

and patient access to compounded treatments. And I look forward 

to the process that we’re going to undertake as we move this forward. 

Dr. Woodcock, I really appreciate you sharing your expertise on 

this subject with us. The draft proposal appropriately focuses FDA 

regulation on large entities that compound the riskiest products. It 

also includes minimum standards for all compounding practices to 

help ensure patient safety when somebody gets a customized drug 

from their neighborhood pharmacy. 

The proposal would require pharmacists to use recognized chemical ingredients to compound a drug and allows the FDA to publish 

a list of ingredients that may not be used for compounding. I wonder if you can explain why it would be necessary to restrict the use 

of some chemical bulk ingredients. And, in particular, can you discuss how the FDA would determine what goes on that list? 

Dr. WOODCOCK. Certainly. There are a variety of risks that can 

be introduced that these provisions are directed at. First, the bulk 

ingredients are generally made overseas in India or China. If they 

have not been subject to FDA inspection, if they’re simply purchased, say, from some supplier, they may not be what they purport to be, or they may be contaminated with chemicals or other 

impurities. 

Second, for some of the very complex dosage forms that we have, 

for example, certain patches that release drugs, even the innovator 

manufacturers have trouble making these. And sometimes they 

will dump drugs into circulation and you could die, because you 

have an extended release patch on, and maybe it gets a little 

warm, or you have a lot of covers on, and they haven’t made it 

properly, and the warmth causes all the drug to go into your circulation, and you get a massive overdose. 

There’s some very, very—and we work with our manufacturers 

to try and deal—we had another one where if people took a drink 

of alcohol, it would dissolve the extended release mechanism, and 

the whole thing would release into the blood stream all at once, 

and people would get serious side effects. So the more complex the 

dosage form, the more difficult it is to manufacture. 

Then we have another category which is—we’re seeing this in dietary supplements now, where drugs we’ve taken off the market 

because they’re too dangerous have been introduced into dietary 

supplements. And those types of drugs that actually have been removed for safety, we wouldn’t want to be compounded and have our 

population exposed. 

Senator BALDWIN. Because I have such limited time, let me just 

ask that this list, as you put it together, is compiled for safety purposes only and not for other reasons. And if that is the fact, what 

sort of procedural safeguards will be in place while you’re developing this list to ensure that any restricted bulk ingredients are, 

in fact, dangerous or pose some safety risk to patients—— 

Dr. WOODCOCK. We certainly would have safety as our principal 

objective here. 

Senator BALDWIN. Any other objectives? 

Dr. WOODCOCK. Safety. That’s really the primary objective. 

Senator BALDWIN. There’s anecdotal information, at least, that 

there will be folks who will be interested in that list for competitive 

24 

purposes and competitive advantage, and I want to make sure the 

FDA won’t be manipulated in that way. 

Dr. WOODCOCK. That’s fair. In my world, there’s always issues of 

competitive advantage, and we try to stick strictly to our objectives. 

Senator BALDWIN. On a related issue, you highlighted the importance of prohibiting the compounding of copies of FDA-marketed 

approved drugs except for during drug shortages. I’m concerned 

about patient access when the approved drug is not available for 

reasons other than a shortage. 

As one example, I think about a compound called 17–P, which 

was brought to market by a drug company at prohibitively high 

prices. This is a drug used to prevent preterm birth. And as a result, the compounded version of the drug is the only available option for many women. What tools does the FDA have or need to 

allow patient access to needed medicines in unique circumstances 

like this other than drug shortages? 

Dr. WOODCOCK. The FDA really doesn’t usually balance human 

safety considerations against economic considerations. This proposed statute, though, is attempting to make sure that there isn’t 

widespread compounding of generic drugs and that generic drug 

firms simply enter the market without pre-market requirements, 

without going to the FDA and having bioequivalence testing and 

having their product approved and proper labeling, and simply 

marketing their drugs as compounded drugs, so that there’s a big 

loophole that allows those drugs to enter the market and compete 

with the established industry and undermine the Federal process 

for introducing generic drugs into the market. That’s the reason for 

those provisions. 

The CHAIRMAN. Thank you, Senator Baldwin. 

Senator Franken. 

STATEMENT OF SENATOR FRANKEN

Senator FRANKEN. Chairman Harkin, Ranking Member Alexander, thank you for convening this important hearing and for all 

your work on pharmacy compounding in the wake of the meningitis 

outbreak last fall. You’ve led a transparent, as Senator Baldwin 

said, and productive process on an extremely complex issue. Thank 

you both for your leadership. 

If my child or my wife urgently needed medicine, I’d ask many 

questions. Will my loved one get well? What’s going to happen? But 

I should never have to ask the question whether the medicine that 

my family is given is safe or whether it is actually what the doctor 

said it should be. 

But more than 1,000 patients and their families across Minnesota had to ask that question last year, because the contaminated medicine that they received could have caused enormous 

harm. More than 50 patients across the country died from these 

contaminated injections produced by a large-scale compounding 

pharmacy in Massachusetts that was essentially an unregulated 

drug manufacturer. 

I come from Minnesota where we specialize in medical innovation. We have some of the best doctors and healthcare systems and 

biomedical pioneers anywhere in the world. Our Nation has an incredible capacity for innovation and development in this field. 

25 

There is no possible justification for allowing more than 17,000 

vials of contaminated medicine to be shipped to providers throughout our country. 

That’s why my colleagues and I have worked so hard over the 

past several months to make sure that this never happens again. 

And I’ll be the first to say that the draft we released 2 weeks ago 

isn’t perfect, and that’s why we asked for stakeholder comments, 

and that’s why we’re working very hard to update the draft based 

on the hundreds of pages of comments that we received. And I’d 

like to thank the many stakeholders who have worked productively 

with us to help improve our proposal. 

Dr. Woodcock, there have been broad concerns among community 

pharmacists that our proposal would cause them to be regulated by 

the FDA and comply with manufacturer-level quality standards. 

Can you clarify whether traditional mom-and-pop pharmacies that 

do not compound batches of sterile products and ship them over 

State lines would have to change their current practices under this 

proposal? 

Dr. WOODCOCK. They are left within the scope of traditional 

pharmacy compounding, and they would not be subject to the manufacturing rules of the FDA or many of the other provisions. Some 

of the do-not-compound issues that we’ve been talking about would 

apply, and that is a safeguard that actually has been in place to 

some extent over the years anyway. So, no, the traditional pharmacy compounding will not substantively change. 

Senator FRANKEN. Dr. Woodcock, if our draft were to pass into 

law, do you believe that FDA would have the authority to prevent 

another company from behaving in the same manner as the New 

England Compounding Center did before the meningitis outbreak? 

Dr. WOODCOCK. Firms shipping sterile products intra-state without receipt of a prescription, which would be the case for these 

large-scale shipments, would be subject to Federal registration, 

would be required under the law to register and list with the FDA. 

We would inspect them, and we would make sure they were complying with the proper accepted practices so that these drugs would 

be sterile. 

Senator FRANKEN. Thank you. Dr. Woodcock, our draft gives the 

FDA the authority to produce a list of complex drugs that should 

not be compounded. I’ll note that in the process of producing this 

list the FDA is required to go through the full notice and comment 

rulemaking process, which means that the FDA must get input 

from pharmacists and other experts on their proposal before it goes 

final. 

Can you tell us if you believe that this list is important, and, if 

so, why? 

Dr. WOODCOCK. Yes, I believe it’s very important. I believe the 

scope of traditional pharmacy compounding is extremely important 

to patients, to practitioners. But it’s also important that that remain safe, and that it not stray into areas where the risk is very 

high. That’s why we’re addressing the interstate shipment of sterile 

products. 

But we’re also addressing very risky practices where the risk 

would be too high. I think that is also very important. However, 

the goal is to not impede the traditional compounding practices. 

26 

Senator FRANKEN. Thank you, Dr. Woodcock. Thank you for your 

testimony, and my time is expired. 

Thank you both, Mr. Chairman and Senator Alexander. 

The CHAIRMAN. Thank you, Senator Franken. 

Dr. Woodcock, thank you very, very much again for your testimony. I’m sure we’ll have some followup questions perhaps in writing to submit to you. But thanks for your input on this as we continue to refine this draft. 

Dr. WOODCOCK. Thank you, and we’re delighted to work with 

you. 

The CHAIRMAN. Thanks, Dr. Woodcock. 

Now we’ll call our second panel. First is Mr. Carmen Catizone, 

who is the executive director of the National Association of Boards 

of Pharmacy. They assist the State boards of pharmacy in protecting the public health, aids in interstate licensing, and helps develop competency standards for the practice of pharmacy. 

Previously, Mr. Catizone was a president of the National Pharmacy Manpower Project of the National Conference of Pharmaceutical Organizations, as well as a past member of the U.S. Pharmacopeia Board of Directors. 

Allan Coukell is here, the director of Medical Programs in The 

Pew Health Group, a division of the Pew Charitable Trusts. Mr. 

Coukell oversees initiatives related to medical products and services, including Pew’s Drug Safety Project. In February, Mr. 

Coukell’s group helped to convene a summit to discuss pharmaceutical compounding which included representatives from health 

professional organizations, compounding pharmacies, quality experts, and the Center for Disease Control and Prevention as well 

as FDA. 

We thank you for doing that. 

Mr. Coukell is both a pharmacist and a consumer advocate, and 

we welcome his perspective today. 

Next is David Miller, executive vice president and CEO of the 

International Academy of Compounding Pharmacists, an association which represents pharmacists who focus on pharmaceutical 

compounding. Previously, Mr. Miller served as the executive director of the Maryland Pharmacists Association and the director of 

Pharmacy Affairs at Merck. Mr. Miller also testified at our hearing 

last November. 

We welcome you back again, Mr. Miller. 

Dr. Kasey Thompson currently serves as the vice president of the 

Office of Policy, Planning, and Communications at the American 

Society of Health-System Pharmacists, an organization which advises its members on the responsible use of compounded medications. Dr. Thompson has extensive knowledge regarding the safe 

use of compounded drugs, as he previously served as the American 

Society of Health-System Pharmacists’ Director of the Center of Patient Safety. Dr. Thompson was also part of our panel in November. 

We welcome you back again, Dr. Thompson. 

As before, all of your statements will be made a part of the 

record. We ask that you summarize those in 5 minutes, and we’ll 

move ahead to questioning. 

First, we’ll start with Mr. Catizone. 

27 

Thank you for being here and please proceed. 

STATEMENT OF CARMEN S. CATIZONE, M.S., RPh, DPh, EXECUTIVE DIRECTOR, NATIONAL ASSOCIATION OF BOARDS OF 

PHARMACY, MOUNT PROSPECT, IL 

Mr. CATIZONE. Thank you, Senator. Good morning, Chairman 

Harkin, Ranking Member Alexander, and committee members. I 

represent the State agencies, the State boards of pharmacy, that 

regulate pharmacists, pharmacies, technicians, and traditional 

compounding. 

In regard to the Chairman’s questions earlier, is the legislation 

effective, does it clarify the differences, does it address the needs 

of the States? The answer to all those questions is yes. We agree 

with the FDA that the situation can and will happen again. It’s not 

a question of whether. 

But some things have changed since the last hearing and since 

the unfortunate incident. One, the FDA has stepped up their inspections. That has made a significant difference to the landscape 

that existed prior to that time. It has also greatly assisted the 

State boards of pharmacy in trying to fulfill their mission to protect 

the public and regulate compounding. 

Taking the lead from the Chairman’s State of Iowa, we partnered 

with the Iowa Board of Pharmacy and to date have inspected 150 

pharmacies across the United States in regard to compounding activities. Those inspections have involved not only the Iowa Board 

of Pharmacy, but the home State where that pharmacy is based. 

We will complete all 600 of Iowa’s non-resident pharmacies before 

the end of 2013 and will have physically inspected those facilities 

with both our own trained staff as well as representatives from the 

Iowa Board of Pharmacy and the resident board of pharmacy as 

well. 

We have also contracted recently with another State to inspect 

150 of their in-state compounding pharmacies, and there are four 

other States that have pending legislation to recognize NABP to assist with the inspection of compounding pharmacies or to conduct 

those inspections on behalf of the State board of pharmacy. 

The legislation presents and we support a clear distinction between compounding and manufacturing. The separation of 

compounding from manufacturing is critical to maintain the 

present authority of the States and address one of the contributing 

factors of the NECC crisis, specifically, what the FDA regulates 

and what the States regulate. 

The provision in the proposed legislation that specifies a 

compounding manufacturer cannot be licensed as a pharmacy is essential to distinguishing from State-regulated compounding and 

FDA regulated manufacturing. If a compounding manufacturer is 

allowed to hold that dual licensure or registration, it will be more 

difficult to separate the two enterprises and could provide a veil for 

unscrupulous entities to obfuscate their activities. 

NABP strongly supports the FDA receiving full and unlimited 

authority to access and seize any and all records related to the 

oversight and regulation of compounding manufacturers. We are 

concerned, however, that allowing the FDA access to pharmacy 

records for activities that are regulated by the States could create 

28 

a confusing situation, could take people off the flagpole, could 

change one of Senator Roberts’ myths, could change the response 

to Senator Harkin’s question about whether or not the FDA has authority over traditional compounding pharmacies. 

We ask the committee to keep this provision intact and to help 

recognize and differentiate between compounding and manufacturing and State authority and Federal authority. The answer to 

remedy that situation is enhanced communication. We have built 

a database of electronic profiles for all pharmacies in the United 

States. We’re including the inspection reports in those profiles and 

making that available real-time to States, and we’ll make it available to the FDA and provide something to the public as well so 

they’ll be able to search that database and decide whether or not 

they want to use that pharmacy for their services. 

The other revision that we ask the committee to consider is the 

exemption of intra-state sterile compounding pharmacies, the intrastate. We believe that the same risks exist with intra-state 

compounding as with interstate. The operations that we’ve observed in intra-state are sometimes as large or larger than the 

interstate operations, and, therefore, we ask the committee to consider this provision and instead include the preparation of nonpatient specific sterile prepared products for intra-state activities 

as a defining component of a compounding manufacturer and fall 

within the scope and authority of the FDA. 

As stated earlier in our statement, the other provisions of the 

proposed legislation that address the safe preparation of medications and products for patients align well with the approaches suggested and requested by the States. The legislation proposed by the 

committee reflects the hard work conducted to understand a complex area of pharmacy practice, compounding, and a complex but 

necessary area of pharmacy practice to ensure that patients receive 

the appropriate medications. 

But, most importantly, even though it is necessary and complex, 

compounding must be regulated effectively. The proposed legislation distinguishes between compounding and manufacturing, defines a new category of manufacturing that balances effective regulation with reality, and carefully constructs allowances and prohibitions on the scope and activities of a compounding manufacturer in 

order to meet patient needs while maintaining the necessary protections. 

Thank you. 

[The prepared statement of Mr. Catizone follows:] 

PREPARED STATEMENT OF CARMEN S. CATIZONE, M.S., RPH, DPH

SUMMARY

On behalf of the State boards of pharmacy and NABP, I extend our appreciation 

to the committee for the proposed legislation that addresses the critical concerns 

identified by the States and validated by NABP through its inspections of 

compounding pharmacies. We welcome the clarifications provided by the proposed 

legislation to the regulatory uncertainties that currently exist—uncertainties that 

were a primary factor leading to the recent meningitis tragedy. Most importantly, 

the clarifications provide the needed distinction between compounding and manufacturing and provide a safe and equitable environment for both compounding and 

manufacturing to occur in the best interest of the patient. 

29 

AUTHORITY OF THE STATES

NABP supports a clear separation of ‘‘compounding manufacturer’’ from traditional pharmacy practice and compounding. The provision of the proposed legislation that specifies a compounding manufacturer cannot be licensed as a pharmacy 

is essential to distinguishing from State-regulated compounding and FDA regulated 

manufacturing. Our experience, and most recently our inspections of compounding 

pharmacies, affirms the importance of this prohibition in clarifying what activities 

fall under Federal jurisdiction and what entities can engage in compounding and 

operate under State jurisdiction. 

TRANSITION PERIOD TO ENSURE UNINTERRUPTED PATIENT CARE AND

NECESSARY EXCEPTIONS

Equally tantamount to the recognition of State authority is the need to ensure an 

appropriate transition period with the States as well as to recognize exceptions for 

activities such as the preparation of radiopharmaceuticals. An appropriate transition period is needed so States will have sufficient time to alert pharmacists and 

other practitioners and ensure that patient care is continued and not halted by new 

requirements that may no longer allow certain activities that were previously permitted under State laws. 

INTRA-STATE EXEMPTION FROM DEFINITION OF COMPOUNDING MANUFACTURER

NABP is concerned with the exemption for intra-state distribution of non-patientspecific sterile compounded products. It is our finding that non-patient-specific, sterile prepared products distributed intra-state bear the same risk levels to patients 

as products that are introduced into interstate commerce. In fact, some intra-state 

operations are as large or larger than interstate distributors of products and therefore the volume of products distributed, and the associated risk, can be equal to or 

greater than the interstate distribution of similar products. The differentiation between intra-state and interstate activities to define a compounding manufacturer 

could create patient safety concerns by unintentionally creating a safe haven for entities and individuals engaging in intra-state activities who have the intent to simply avoid the different and Federal-based requirements for interstate activities. 

Good morning Chairman Harkin, Ranking Member Alexander, and committee 

members. I am Carmen Catizone, executive director of the National Association of 

Boards of Pharmacy (NABP). NABP thanks you for the opportunity to appear today 

and comment on the bipartisan Draft Proposal on Pharmaceutical Compounding. 

NABP commends the Senate HELP Committee for its diligence on this issue and 

the thoughtful approach taken in the draft proposal. 

NABP is the impartial organization founded in 1904 whose members are the State 

agencies that regulate the practice of pharmacy. NABP supports the State boards 

of pharmacy by developing, implementing, and enforcing uniform standards for the 

purpose of protecting the public health. NABP also helps State boards of pharmacy 

to ensure the public’s health and safety through its pharmacist license transfer, 

pharmacist competence assessment, and accreditation programs. 

Following the tragic meningitis outbreak caused by contaminated injectable drugs, 

several States implemented compounding pharmacy inspections or conducted surveys of pharmacies, focusing especially on those engaged in sterile compounding. As 

part of the NABP Compounding Action Plan that was developed in November 2012 

and implemented in December 2012, NABP partnered with the Iowa Board of Pharmacy and other States to begin conducting inspections of all nonresident pharmacies 

delivering compounded drugs into Iowa. Our initial inspections confirmed that what 

occurred at NECC was also occurring at other facilities in other States. To date, 

NABP has inspected approximately 150 pharmacies across the States and will continue our inspections until all of Iowa’s approximately 600 non-resident pharmacies 

are inspected. In addition to the inspection program with Iowa, NABP recently executed an agreement with the State of New Jersey to assist with the inspection of 

in-state compounding pharmacies and the prosecution of any pharmacy or individual illegally engaged in the practice of compounding. Four other States have legislation pending or are in the process of designating NABP to conduct or assist with 

inspections of pharmacies for, or in their States. 

The States thank the committee for the proposed legislation that addresses the 

critical concerns identified by the States and validated by NABP and its inspections 

of compounding pharmacies. As such, we welcome the clarifications provided by the 

proposed legislation to the regulatory uncertainties that currently exist and were 

30 

one of the primary factors leading to the recent meningitis tragedy. Most importantly, the clarifications provide the needed distinction between compounding and 

manufacturing and provide a safe and equitable environment for both compounding 

and manufacturing to occur in the best interest of the patient. 

AUTHORITY OF THE STATES

NABP supports a clear separation of ‘‘compounding manufacturing’’ from traditional pharmacy practice and compounding. Although we would prefer that 

‘‘compounding’’ not be included in the proposed designation because of the inference 

to traditional compounding and the confusion that could result, we understand that 

some terminology must be employed that describes the activity being regulated. 

The separation of compounding from manufacturing is also critical to maintain 

the present authority of the States and address one of the contributing factors to 

the NECC crisis, ambiguous authority between the States and the Food and Drug 

Administration (FDA). The provision of the proposed legislation that specifies a 

compounding manufacturer cannot be licensed as a pharmacy is essential to distinguishing from State-regulated compounding and FDA-regulated manufacturing. Our 

experience, and most recently our inspections of compounding pharmacies, affirms 

the importance of this prohibition in clarifying what activities fall under Federal jurisdiction (FDA) and what entities can engage in compounding and operate under 

State jurisdiction (State boards of pharmacy). 

If a compounding manufacturer is allowed to hold dual licensure/registration, it 

will be more difficult to separate the two enterprises and will provide a veil for unscrupulous entities to obfuscate their activities. NABP supports FDA receiving authority to access any and all documents and records required for the oversight and 

regulation of compounding manufacturers. We are concerned about allowing the 

FDA access to pharmacy records for activities that are regulated by the States. If 

an entity is manufacturing or compound manufacturing, then under the proposed 

legislation and current authority, the FDA will have access to all documents and 

records concerning these activities. Authorizing the FDA access to pharmacy records 

could create jurisdictional conflicts with the States and impede the States from investigating or prosecuting a case because the FDA has seized evidence or information needed by the State(s). What is needed in lieu of allowing such access is increased communication between the States and FDA. 

NABP is collecting and maintaining data on the compounding pharmacies identified by the Iowa Board as well as those indicated by other boards of pharmacy. Our 

electronic data base of e-Profiles for pharmacies is being expanded and enriched to 

include all pharmacies licensed or registered in the United States by State boards 

of pharmacy and comparable State agencies. Data collected from the boards and the 

inspection reports provided by the States and through NABP’s activities with, or on 

behalf of the States, will be stored in an NABP Pharmacy e-Profile, allowing us to 

disseminate pertinent information among State boards and the FDA. States are now 

able to submit inspection reports and other related information to NABP for inclusion in pharmacies’ e-Profiles. The e-Profiles for Pharmacies will be made available 

at no cost to boards for use in making licensure and registration determinations for 

pharmacies, the FDA, and to the public for their use in selecting an appropriate 

pharmacy. 

TRANSITION PERIOD TO ENSURE UNINTERRUPTED PATIENT CARE AND

NECESSARY EXCEPTIONS

Equally tantamount to the recognition of State authority is the need to ensure an 

appropriate transition period with the States as well as to recognize exceptions for 

activities such as the preparation of radiopharmaceuticals. An appropriate transition period is needed so States will have sufficient time to alert pharmacists and 

other practitioners and ensure that patient care is continued and not halted by new 

requirements that may no longer allow certain activities that were previously permitted under State laws. One such example is the compounding ‘‘for office use’’ that 

is currently allowed in some States. It is our understanding that the proposed legislation addresses this concept in different provisions and that overall the classification of such activities is a State matter when the products prepared are distributed 

intra-state and a Federal matter when the products prepared are distributed in 

interstate commerce. If the proposed legislation is adopted and these distinctions 

are correct and implemented, States will need some time to make the adjustments 

in State laws in order to ensure uninterrupted patient care and close any regulatory 

gaps that might result. 

31 

INTRA-STATE EXEMPTION FROM DEFINITION OF COMPOUNDING MANUFACTURER

NABP is also concerned with the exemption of the intra-state distribution of nonpatient-specific sterile compounded products. We support the logic of establishing a 

delineation point in order to more readily identify and regulate large-scale operations that conceivably pose more risk to patients than smaller operations. However, 

it is our finding that non-patient-specific, sterile prepared products distributed 

intra-state bear the same risk levels to patients as products that are introduced into 

interstate commerce. In fact, some intra-state operations are as large and larger 

than interstate distributors of products and therefore the volume of products distributed, and the associated risk, can be equal to or greater than the interstate distribution of similar products. The differentiation between intra-state and interstate activities to define a compounding manufacturer could create patient safety concerns 

by unintentionally creating a safe haven for entities and individuals engaging in 

intra-state activities who have the intent to simply avoid the different and Federalbased requirements for interstate activities. 

We ask the committee to reconsider this provision and instead include the preparation of non-patient-specific, sterile prepared products for intra-state activities as 

a defining component of a compounding manufacturer and within the scope of authority of the FDA. 

CONCLUSION

As stated earlier in our statement, the other provisions of the proposed legislation 

that address the safe preparation of medications and products for patients align well 

with the approaches suggested and recommended by the States. The legislation proposed by the committee demonstrates the hard work conducted to understand a 

complex area of pharmacy practice that is necessary to ensure that patients receive 

the appropriate medications but must also be regulated effectively. The legislation 

distinguishes between compounding and manufacturing, defines a new category of 

manufacturing that balances effective regulation with reality, and carefully constructs allowances and prohibitions on the scope and activities of a compounding 

manufacturer in order to meet patient needs with the necessary protections. NABP 

appreciates this opportunity for input and is available to discuss our comments and 

the proposed legislation in greater detail. 

Thank you. 

The CHAIRMAN. Thank you very much, Mr. Catizone. 

Mr. Coukell, again, welcome and please proceed. 

STATEMENT OF ALLAN COUKELL, DIRECTOR, MEDICAL 

PROGRAMS, THE PEW CHARITABLE TRUSTS, WASHINGTON, DC 

Mr. COUKELL. Chairman Harkin, Ranking Member Alexander, 

and members of the committee, thank you for the opportunity to 

testify. My name is Allan Coukell. I’m a pharmacist and director 

of drug and medical device work at the Pew Charitable Trusts, an 

independent research and public policy organization. Pew has a 

long focus on drug quality issues. I am pleased to be able to support the bipartisan proposal before you today. 

Pharmacists have always compounded medicines, but the activities you seek to address are far removed from the traditional preparation of an individualized medicine for a single patient. Some 

compounding pharmacies now produce large volumes of drugs and 

ship thousands of units of high-risk or sterile products to clinics 

and hospitals across the country. 

The fungal meningitis outbreak caused by contaminated steroid 

injections highlights the risk to patients. But it’s only one recent 

case. Included with my written testimony is a summary of 19 more 

pharmacy compounding errors from the past decade. It includes 22 

additional deaths, as well as meningitis, bloodstream infections, 

and at least 38 patients blinded or suffering vision loss caused by 

a compounded drug. 

32 

And it notes toxicities caused by super-potent products. For example, three people died in 2007 after receiving intravenous injections for back pain that were eight times the labeled strength. 

Recent FDA inspections raise further concerns. For example, a 

New Jersey compounder 2 months ago recalled all of its products 

because of potential mold and particulates in the vials. Another 

case this year involved a Georgia compounder that conducted a nationwide recall because of serious eye infections. 

Congress has long grappled with these risks. Section 503(A) of 

the Food, Drug, and Cosmetic Act was passed in 1997 and later 

partially struck down by the courts. Members of this committee 

have tried again. In 2007, legislation was strongly opposed by the 

compounding industry and did not pass. Today, FDA’s legal authority remains unclear. 

The proposal before you offers the opportunity to finally address 

some high-risk compounding activities, and it has the following 

strengths: It addresses sterile products, which are especially high 

risk. It includes facilities that sell in multiple States and, therefore, 

captures many of the largest operations, though not all of them. 

And it contains safeguards that will help prevent compounders undermining gold standard FDA-approved drugs. 

Under this legislation, a new category of compounding manufacturers would need to comply with applicable good manufacturing 

practices, as do pharmaceutical companies making FDA-approved 

drugs. This would be an improvement on the USP standards used 

in many States which were not designed for large-scale anticipatory production. 

This point was stressed strongly by experts who spoke at a recent compounding summit hosted by Pew, ASHP, and the American Hospital Association. The current proposal recognizes that 

FDA is the appropriate agency to oversee this higher quality standard. 

While the goal is to ensure the quality of compounded products, 

patients, doctors, and pharmacists should prefer FDA-approved 

drugs whenever possible. Only the latter go through premarket review to establish safety, efficacy, bioequivalence, along with the 

pre-approval of manufacturing methods and facilities. So it’s important that this new regulatory scheme not encourage compounding 

at the expense of traditional manufacturing. 

This draft contains a number of important safeguards. First, it 

clarifies that certain products may not be compounded by anyone, 

and that certain ingredients may not be used in compounding. It’s 

also clear that the compounder may not make a copy or a variation 

of a marketed drug unless that drug is in shortage. We support the 

prohibition on wholesaling compounded drugs which will further 

reduce incentives to circumvent the FDA approval process. 

Appropriately, these safeguards apply to all compounders and 

not just compounding manufacturers. Therefore, to support FDA’s 

enforcement, we urge the committee to allow FDA to access records 

during inspections of all pharmacies, which will also allow the 

Agency to investigate whether a pharmacy is actually a 

compounding manufacturer. 

Let me note that there are some important areas of risk not addressed by this proposal. First, companies that sell products within 

33 

a single State will continue to operate without FDA oversight. That 

means that identical products produced under identical conditions 

in identical volumes will be subject to different regulatory schemes. 

No State enforces GMP, and States vary widely in their ability to 

oversee large-scale compounding. 

Second, this proposal does not address non-sterile compounding 

regardless of scale, even though improperly compounded tablets or 

capsules also have the potential to cause harm. Despite the areas 

not addressed, this bipartisan proposal is an important step toward 

addressing a longstanding risk to patients. 

I thank you for your leadership and welcome any questions. 

[The prepared statement of Mr. Coukell follows:] 

PREPARED STATEMENT OF ALLAN COUKELL

Dear Chairman Harkin, Ranking Member Alexander and members of the committee, thank you for the opportunity to testify on your proposal to improve the 

safety of pharmaceutical compounding. 

My name is Allan Coukell. I am a pharmacist and director of drug and medical 

device work at the Pew Charitable Trusts, an independent, nonpartisan research 

and public policy organization. 

Pharmacists have always compounded medicines—it is the origin of the profession—but the activities you seek to address today are far removed from the traditional practice of preparing individualized medicines for one patient at a time. 

Today, some compounders produce large volumes of drugs, often manufacturing 

them before a prescription is received, shipping many thousands of units—high-risk 

or sterile products—to clinics and hospitals across the country. 

The regulatory framework has not kept up with this changing industry. Traditionally, States oversee pharmacy practice and the FDA oversees drug manufacturing. 

But compounding falls into a grey zone. In a very broad sense, FDA has the authority to regulate some compounding activities, but it is not at all clear how far that 

authority goes. Nor are there formalized mechanisms to divide the oversight of 

compounding between the States and FDA. 

EXAMINING THE RISKS

The epidemic caused by the New England Compounding Center is but the most 

recent case highlighting the risks to patients. 

That outbreak has been associated with 53 deaths so far and nearly 700 serious 

infections. Included with my testimony is a Pew summary that describes 19 additional pharmacy compounding errors since 2001.1

The list includes 22 additional deaths, as well as serious infections—meningitis, 

bloodstream and at least 38 patients who suffered partial or complete loss of vision—but also patients harmed by sub-potent or super-potent doses. For example, 

in 2007 three people died after receiving intravenous colchicine that was eight times 

the labeled strength.2

Recent inspections of compounders raise further concern: Two months ago, the 

FDA announced a recall of all of the products manufactured by a New Jersey 

compounder because of potential mold contamination. The FDA press release referred to ‘‘visible particulate contaminants’’ in what was supposed to be a sterile 

product.3 Also this year, a Georgia compounder conducted a nationwide recall of 

sterile products after reports of serious eye infections.4

APPROPRIATE OVERSIGHT AND QUALITY STANDARDS

Congress has long grappled with these risks. The current section 503(A) of the 

Food, Drug and Cosmetic Act was passed in 1997. After the courts struck down 

parts of that provision, members of this committee tried again to create meaningful 

Federal oversight of certain compounding activities. But that legislation was strongly opposed by the compounding industry, and did not pass. Today, FDA’s legal authority remains unclear. Even as the Agency steps up its oversight of compounders, 

its ability to access records has been challenged.5

The proposal before you today offers an opportunity to finally address some, 

though not all, high-risk compounding activities. It has the following strengths: 

• It addresses sterile products, which are particularly high risk; 

34 

• By including facilities that sell in multiple States, it will capture many of the 

largest operations; and • It contains safeguards that will help prevent compounders from undermining 

‘‘gold-standard,’’ FDA-approved drugs. 

INCREASED FEDERAL OVERSIGHT

The legislation creates a new category of FDA-regulated ‘‘compounding manufacturers’’—compounders that produce sterile products in anticipation of a prescription 

and who sell product outside the State in which it is created. 

The bill would require compounding manufacturers to comply with the same manufacturing quality standards, known as good manufacturing practices (GMPs), that 

apply to pharmaceutical companies making FDA-approved drugs. 

This recognizes that the U.S. Pharmacopeial standards (chapter 797) used in 

many States are unsuited to large-scale anticipatory production. Pew recently joined 

with the American Hospital Association (AHA) and the American Society of HealthSystem Pharmacists (ASHP) to co-host a pharmacy compounding summit that heard 

from experts who stressed this point strongly. The FDA, and not State pharmacy 

boards, is the appropriate agency to enforce GMPs. 

Using limited resources wisely necessitates addressing the largest potential public 

health problems first. That means, in part, ensuring quality standards at facilities 

that produce large numbers of doses. While not perfect, we believe that the proposed 

framework for interstate sales would capture a meaningful portion of the highest 

risk compounding. 

However, we urge the committee to not exclude mixing and reconstituting of 

drugs in accordance with manufacturer label from the definition of compounding 

manufacturer. If these ostensibly sterile products are mixed in large volume under 

unsanitary conditions, it could represent a significant public health risk. 

In addition, the definition of compounding manufacturer should include repackagers of preservative-free syringes and mini-bags or other units of sale and should 

not be limited to repackagers of preservative free vials. 

COMPOUNDED PRODUCTS MUST NOT DISPLACE FDA-APPROVED DRUGS

It is important to note that while compounding manufacturers will be subject to 

FDA oversight of and quality standards, their products will not have gone through 

the pre-market approval process that brand and generic drug companies go through 

to demonstrate safety, efficacy and bioequivalence, along with pre-approval of manufacturing methods and facilities. 

Because of those differences, compounded medicines can never be an adequate 

substitute for FDA-approved drugs. It is important this new regulatory scheme not 

encourage compounding at the expense of traditional manufacturing, and we believe 

the draft contains a number of important safeguards. 

First, the bill clarifies that certain products may not be compounded by anyone, 

and that certain ingredients may not be used in compounding. It gives the FDA the 

authority to specify these products and ingredients, and restricts compounding from 

bulk to ingredients that are described by a USP monograph or are in an alreadyapproved product. 

The draft is also clear that a compounder may not make a copy or a variation 

of a marketed drug, except when that drug is in shortage. An exception allows variations compounded from bulk drugs to address specific medical needs, but only 

when a prescriber communicates in advance of the compounding that the drug 

would make a serious difference for the patient. 

We also support the provisions that prohibit the wholesale of compounded drugs, 

which further reduces incentives to circumvent the FDA drug-approval process. 

Appropriately, these important safeguards apply to all compounders, not just to 

compounding manufacturers. Therefore, to support FDA’s enforcement of these safeguards, we urge the committee to allow the FDA to access records during inspections of all pharmacies, not just compounding manufacturers. Further, the Agency 

must be able to investigate a company to determine whether it is, in fact, a selfidentified ‘‘traditional compounder’’ or is actually a compounding manufacturer. A 

critical tool within such an investigation is access to records. 

AREAS OF RISKS THAT ARE NOT ADDRESSED

It is important to understand which activities FDA would not regulate under this 

legislation, and the potential risks to patients. 

First, large-scale sterile compounding operations that operate within a single 

State will continue to operate without FDA oversight. This means that identical 

products produced under identical conditions in identical volumes will be subject to 

35 

different regulatory schemes, depending on the accident of whether or not they are 

sold in one State or two. And, as our compounding summit heard, State pharmacy 

regulators vary widely in their ability to oversee large-scale compounding. Indeed, 

some States have elected not to register or provide oversight to such facilities. No 

State enforces quality standards equivalent to Good Manufacturing Practices. 

Second, this proposal does not address non-sterile compounding, regardless of 

scale. Pew supports prioritized oversight of sterile products, but we note that there 

are a number of non-sterile compounded drugs, such as compounded ‘‘bioidentical’’ 

hormone replacement pills, that are widely distributed. Compounded oral dosage 

forms have the potential to cause harm by both impurities and sub- or superpotency. 

JURISDICTIONAL ISSUES

Finally, we recommend that the committee consider allowing both Federal and 

State jurisdiction for entities that wish to engage in compounding manufacturing 

and pharmacy practice. We believe FDA’s oversight responsibility would still be 

clear, driven by the framework outlined in this bill. Entirely preventing a 

compounding manufacturer from engaging in any traditional pharmacy practice may 

be difficult, and where any entity engages in pharmacy practice, they must be licensed and overseen by appropriate State authorities. 

CONCLUSION

The business of compounding has changed dramatically over the last 30 years and 

the regulatory framework has not kept pace. The lines of authority are unclear and 

there are significant gaps in oversight that leave much high risk, high volume pharmacy compounding almost unregulated. The lack of a meaningful regulatory framework may have guaranteed the kind of tragedy seen last fall, and that we will see 

again if Congress does not enact meaningful and enforceable rules to govern 

compounding. This bi-partisan draft legislation is an important step forward. 

We thank you for your bipartisan leadership, and urge swift action to protect patients and avoid further senseless deaths. 

Thank you for the opportunity to testify, and I welcome your questions. 

REFERENCES

1. The Pew Charitable Trusts. U.S. Illnesses and Deaths Associated With Compounded Medications (2001–Present). April 15, 2013. http://www.pewhealth.org/ 

other-resource/us-illnesses-and-deaths-associated-with-compounded-medications85899468587. 

2. U.S. Centers for Disease Control and Prevention. ‘‘Deaths from Intravenous 

Colchicine Resulting from a compounding Pharmacy Error—Oregon and Washington, 2007,’’ Morbidity and Mortality Weekly Report. October 12, 2007. 56(40): 

1050–52. http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5640a3.htm. Accessed January 8, 2013. 

3. Medprep Consulting Inc. ‘‘Medprep Consulting Inc. Announces Voluntary Nationwide Recall of All Lots of All Compounded Products Due To Potential Mold Contamination.’’ Press Release. March 20, 2013. http://www.fda.gov/Safety/Recalls/ 

ucm344787.htm. 

4. U.S. Food and Drug Administration. ‘‘FDA alerts health care providers and patients of the nationwide recall of all lots of sterile products distributed by Clinical 

Specialties Compounding Pharmacy’’. Press Release. March 21, 2013. http:// 

www.fda.gov/NewsEvents/Newsroom/PressAnnouncements/ucm345019.htm. 

5. Hamburg, Margaret A. ‘‘FDA Must Have New Authorities to Regulate Pharmacy Compounding.’’ FDA Voice. March 22, 2013. http://blogs.fda.gov/fdavoice/ 

index.php/2013/03/fda-must-have-new-authorities-to-regulate-pharmacy-compounding/. 

36 

The Pew Charitable Trusts 

Appendix B—U.S. Illnesses and Deaths Associated With Compounded Medications 

(2001–Present) * 

Year States Reported 

cases 

Reported 

deaths Adverse events Compounding error Product 

2012 ... FL, GA, ID, IL, 

IN, MD, Ml, 

MN, NC, NH, 

NJ, NY, OH, 

PA, RI, SC, 

TN, TX, VA.

733 53 Fungal meningitis and 

other infections.

Contamination 1 .... Spinal injections: preservative-free sterile 

methylprednisolone acetate. 

2012 ... CA and six 

other States.

33 Fungal eye infection; 23 

cases of partial to 

severe vision loss.

Contamination 2 .... Eye injections: Brilliant 

Blue-G (BBG) retinal 

dye and triamcinalone. 

2011 ... FL, TN ............ 21 Bacterial eye infection; 

one case of meningitis and encephalitis; four cases of 

loss of eyesight; 

three patients had 

eye removals.

Contamination 3 .... Eye injections: intravitreal 

bevacizumab (Avastin) 

injections. 

2011 ... CA .................. 5 Blindness ...................... Unintended presence of another 

medication 4.

Eye injections: intravitreal 

bevacizumab (Avastin 

injections. 

2011 ... AL ................... 19 9 Bacterial bloodstream 

infection.

Contamination 5 .... Parenteral nutrition solution. 

2010 ... IL .................... 1 1 Fatal overdose .............. Dose of sodium 60 

times stronger 

than ordered 6.

IV solution: sodium chloride. 

2007 ... WA, OR ........... 3 3 Fatal overdose .............. Dose of colchicine 

eight times 

stronger than 

labeled concentration 7.

IV solution: colchicine. 

2007 ... MD, CA ........... 8 Bacterial bloodstream 

infection.

Contamination 8 .... IV solution: fentanyl. 

2004–6 MI, MO, NY, 

SD, TX, WY.

80 Bacterial bloodstream 

infection.

Contamination 9 .... IV flush syringes: 

heparinized saline. 

2006 ... OH .................. 1 1 Fatal overdose .............. Dose of sodium 

chloride stronger than ordered 10.

Chemotherapy infusion. 

2006 ... NV .................. 1 1 Fatal overdose .............. Dose of zinc 1,000 

times stronger 

than ordered 11.

Neonatal parenteral nutrition solution. 

2005 ... .................. 2 Bacterial bloodstream 

infection.

Contamination 12 .. IV flush vials: preservative-free heparinized 

saline. 

2005 ... MN and one 

other State.

6 Bacterial eye infection; 

all cases had partial 

or complete loss of 

vision; two patients 

had eye removals.

Contamination 13 .. Eye solution: trypan blue. 

2005 ... VA ................... 5 3 Systemic inflammatory 

response syndrome.

Contamination 14 .. Heart infusion: 

cardioplegia. 

2005 ... CA, NJ, NC, 

NY, MA.

18 Bacterial bloodstream 

infection.

Contamination 15 .. IV solution: magnesium 

sulfate. 

2004 ... CT ................... 2 Bacterial bloodstream 

infection.

Contamination 16 .. IV flush syringes: heparin-vancomycin. 

2004 ... MO, NY, TX, 

Ml, SD.

64 Bacterial bloodstream 

infection.

Contamination 17 .. IV flush syringes: 

heparinized saline. 

2002 ... NC .................. 5 1 Fungal meningitis and 

sacroiliitis.

Contamination 18 .. Spinal injections: 

methylprednisolone acetate. 

37 

The Pew Charitable Trusts—Continued 

Appendix B—U.S. Illnesses and Deaths Associated With Compounded Medications 

(2001–Present) * 

Year States Reported 

cases 

Reported 

deaths Adverse events Compounding error Product 

2001 ... CA .................. 11 3 Five cases of bacterial 

meningitis; five 

cases of epidural 

abscess; one patient 

had an infected hip 

joint.

Contamination 19 .. Spinal or joint injections: 

betamethasone. 

2001 ... .................. 4 Bacterial bloodstream 

infection.

Contamination 20 .. IV infusion: ranitidine. 

Total .................. 1,022 75 

* The Pew Charitable Trusts has identified 20 pharmacy compounding errors associated with 1022 adverse events. including 75 deaths, 

since 2001. Contamination of sterile products was the most common compounding error, though some incidents were the result of phar- macists’ and technicians’ miscalculations and mistakes in filling prescriptions. 

Pew’s drug safety project works to ensure a safe, reliable pharmaceutical manufacturing and distribution system. For more information, visit www.pewhealth.org/ 

drugsafety. 

REFERENCES

1. U.S. Centers for Disease Control and Prevention. Multistate Meningitis Outbreak Investigation. http://www.cdc. gov/HAI/outbreaks/meningitis.html. Accessed 

January 29, 2013. 

2. U.S. Centers for Disease Control and Prevention. ‘‘Notes from the field: 

Multistate outbreak of postprocedural fungal endophthalmitis associated with a single compounding pharmacy—United States, March–April 2012,’’ Morbidity and Mortality Weekly Report. May 2012. 61(17): 310-1. http://www.cdc.gov/mmwr/preview/ 

mmwrhtml/mm6117a5.htm. Accessed December 21, 2012. 

3. Based on two separate outbreaks: 12 in Florida, 9 in Tennessee. Respective cites below. 

Goldberg RA, Flynn HW Jr, Isom RF, Miller D, Gonzalez S. ‘‘An outbreak of streptococcus endophthalmitis after intravitreal injection of bevacizumab,’’ American 

Journal of Ophthalmology. February 2012. 153(2): 204–08.e1. 

Frost BA, Kainer MA. ‘‘Safe preparation and administration of intravitreal 

bevacizumab injections.’’ New England Journal of Medicine. December 2011. 

365(23): 2238. 

4. Department of Veterans Affairs Office of Inspector General. ‘‘Healthcare Inspection Oversight Review of Ophthalmology Adverse Drug Events VA Greater Los Angeles Healthcare System Los Angeles, California.’’ Report No. 12-01515-151 April 

12, 2012. http://www.va.gov/oig/pubs/VAOIG-12-01515-151.pdf. Accessed January 

8, 2013. 

5. Thompson, Cheryl A. ‘‘Bacteremia outbreak tied to improper filtration by 

compounding pharmacy.’’ American Journal of Health System Pharmacy. November 

2011. 68(22): 2110–11. http://www.ashp.org/menu/News/PharmacyNews/News 

Article.aspx?id=3628. Accessed January 8. 2011. 

6. Vitello, Barbara. ‘‘Lutheran General to pay $8.25 million in baby’s death,’’ Daily 

Herald. April 5, 2012. http://www.dailyherald.com/article/20120405/news/ 

704059806/. Accessed January 8, 2012. 

7. U.S. Centers for Disease Control and Prevention. ‘‘Deaths from Intravenous 

Colchicine Resulting from a Compounding Pharmacy Error—Oregon and Washington. 2007,’’ Morbidity and Mortality Weekly Report. October 12, 2007. 56(40): 

1050–52. http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5640a3.htm. Accessed January 8, 2013. 

8. Maragakis LL, Romanee C, Srinivasan A, et al. ‘‘Sphingomonas paucimobilis 

bloodstream infections associated with contaminated intravenous fentanyl,’’ Emerging Infectious Diseases. January 2009. 15:12–8. http://wwwnc.cdc.gov/eid/article/ 

15/1/08-1054lintro.htm. Accessed January 9, 2013. 

9. Gershman MD, Kennedy DJ, Noble-Wang J, et al. ‘‘Multistate outbreak of 

Pseudomonas fluorescens bloodstream infection after exposure to contaminated 

heparinized saline flush prepared by a compounding pharmacy.’’ Clinical Infectious 

38 

Diseases. December 2008. 47(11): 1372–9. http://cid.oxfordjournals.org/content/47/ 

11/1372.full.pdf+html. Accessed January 9, 2013. 

10. Institute for Safe Medication Practices. Medication Safety Alert. ‘‘Failed check 

system for chemotherapy leads to pharmacist’s no contest plea for involuntary manslaughter.’’ April 23, 2009. http://www.ismp.org/newsletters/acute-care/articles/ 

20090423.asp. Accessed January 9, 2013. 

11. Grissinger, Matthew RPh, FASCP. ‘‘A Fatal Zinc Overdose in a Neonate. Confusion of Micrograms With Milligrams,’’ Pharmacy and Therapeutics. July 2011; 

36(7): 393–94, 409. http://www.ncbi.nlm.nih.gov/pmc/articles/PMC3171817/. 

Accessed January 9, 2013. 

12. Perz, Joseph F, et al. ‘‘Pseudomonas putida Septicemia in a Special Care 

Nursery Due to Contaminated Flush Solutions Prepared in a Hospital Pharmacy,’’ 

Journal of Clinical Microbiology. October 2005. 43(10): 5316–18. http://jcm. 

asm.org/content/43/10/5316.long. Accessed January 9, 2013. 

13. Sunenshine, Rebecca, et al. ‘‘An Outbreak of Postoperative Gram-Negative 

Bacterial Endophthalmitis Associated with Contaminated Trypan Blue Ophthalmic 

Solution.’’ Clinical Infectious Diseases. April 2009. 48(11): 1580–83. http://cid.oxfordjournals.org/content/48/11/1580.full. pdf+html. Accessed January 9, 2013. 

14. Maryland State Board of Pharmacy. ‘‘Order for Summary Suspension.’’ In the 

matter of Central Admixture Pharmacy Services, Inc. http://www.dhmh 

.maryland.gov/pharmacy/docs/FormalOrders/C/C.A.P.S%2011-15-05.pdf. Accessed 

January 9, 2013. 

15. Sunenshine, Rebecca H, et al. ‘‘A Multistate Outbreak of Serratia marcescens: 

Bloodstream Infection Associated with Contaminated Intravenous Magnesium Sulfate from a Compounding Pharmacy,’’ Clinical Infectious Diseases. July 2007. 45: 

527–33. http://cid.oxfordjournals.org/content/45/5/527.full.pdf. Accessed January 

9, 2013. 

16. Held MR, Begier EM, Beardsley DS, et al. ‘‘Life-threatening sepsis caused by 

Burkholderia cepacia from contaminated intravenous flush solutions prepared by a 

compounding pharmacy in another state,’’ Pediatrics. July 2006. 118:e212-5. http:// 

pediatrics.aappublications.org/content/118/1/e212.long. Accessed January 9, 2013. 

17. Based on two sets of infections, one immediate and one delayed. Immediate infection cases included nine in Missouri, 12 in New York, 14 in 

Texas, and one in Michigan. Delayed infection cases included 15 in Michigan and 13 in South Dakota. Respective cites below. 

U.S. Centers for Disease Control and Prevention. ‘‘Pseudomonas Bloodstream Infections Associated with a Heparin/Saline Flush—Missouri, New York, Texas, and 

Michigan, 2004–5,’’ Morbidity and Mortality Weekly Report. March 2005. 54(11): 

269–72. http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5411a1.htm. Accessed 

January 9, 2013. 

U.S. Centers for Disease Control and Prevention. ‘‘Update: Delayed Onset 

Pseudomonas fluorescens Bloodstream Infections After Exposure to Contaminated 

Heparin Flush—Michigan and South Dakota, 2005–6,’’ Morbidity and Mortality 

Weekly Report. September 2006. 55(35): 961–63. http: www.cdc.gov/mmwrm/preview/mmwrhtml/mm5535a2.htm. Accessed January 9, 2013. 

18. U.S. Centers for Disease Control and Prevention. ‘‘Exophiala Infection from 

Contaminated Injectable Steroids Prepared by a Compounding Pharmacy—United 

States, July–November 2002.’’ Morbidity and Mortality Weekly Report. December 

2002. 51(49): 1109–12. http://www.cdc.gov/mmwr/preview/mmwrhtml/mm5149a1. 

htm. Accessed January 9, 2013. 

19. Civen R, Vugia DJ, Alexander R, et al. ‘‘Outbreak of Serratia marcescens infections following injection of betamethasone compounded at a community pharmacy.’’ Clinical Infectious Diseases. August 2006. 43: 831–7. http://cid.oxford 

journals.org/content/43/7/831.full.pdf+html. Accessed January 9, 2013. 

20. Selenic, D., et al. ‘‘Enterobacter cloacae bloodstream infections in pediatric patients traced to a hospital pharmacy,’’ American Journal of Health System Pharmacy. July 2003. 60(14) 1440–6. 

The CHAIRMAN. Thank you, Mr. Coukell. 

And now we’ll turn to Mr. Miller. Welcome back. Please proceed. 

STATEMENT OF DAVID G. MILLER, EXECUTIVE VICE PRESIDENT AND CEO, INTERNATIONAL ACADEMY OF COMPOUNDING PHARMACISTS, MISSOURI CITY, TX 

Mr. MILLER. Thank you very much, Mr. Chairman. My name is 

David Miller, and on behalf of the International Academy of 

39 

Compounding Pharmacists, it is a pleasure to be back before the 

committee and also to have been actively involved with your committee and staff in the creation of this draft proposal. 

I want to keep my comments today focused on three major 

points. One is consistency, one is accountability, and one is on patient protection. First and foremost, I want to commend the committee for preparing this draft in a manner that gained the input 

of the pharmacy and physician community, the veterinary community, and the Food and Drug Administration. I think we’re close. 

We’re not there yet, but we’re close. 

I want to speak first and foremost to the issue of consistency and 

clarity. In the current draft bill, we see that there are some significant discrepancies between proposed language and what we’ve already seen either at the State level or has been enacted at the 

State level in the first few months of 2013. 

Since the tragedy in Massachusetts began back in October, there 

have been 53 individual State bills introduced and actively considered, and some have already been enacted. As Senator Mikulski 

said, in my home State of Maryland, we have already moved forward there. Twenty-seven State boards of pharmacy are actively 

overhauling all of their regulations. It’s very important as we look 

at this draft language that we ensure that the definitions used in 

the Federal statute that will eventually be enacted are consistent 

with how pharmacy is regulated at the State level. 

I’ll give you a couple of quick instances. We have talked about 

the preparation of medications in advance of a prescription as 

being one of the potential tests, especially in the sterile medication 

environment, that would place someone into this non-traditional 

manufacturing category, this compounding manufacturing category. 

It’s important to understand that as compounding pharmacists, 

we do prepare medications before prescriptions are received in our 

practices. The reason we do that is that our national standards 

under the U.S. Pharmacopeia require us to prepare batches and 

test them so that we can be confident in their quality. 

So we have to make sure that our definitions and our language 

are consistent from the Federal level and then down into the State 

level. We see that also with a lack of recognition of physician office 

use prescribing, which many States have available, and yet the 

current language that we have before us would essentially ignore 

the existence of that and raise questions about the consistency and 

clarity of the application of this language. 

Finally, I also want to point out, under the category of clarity, 

that we have proposed in this legislation that veterinary drugs 

would be regulated in a markedly different way than we would humans. For example, on the human side, we would continue to have 

in some manner an expanded do-not-compound list. Yet on the veterinary side, we’re creating something completely different and, 

again, inconsistent by having a—these are the ones you can compound. 

So we believe, based especially upon our conversations and the 

testimony that you heard back in November, consistency in law at 

the Federal and State level must be addressed. We’re close, but not 

quite there, and some of our recommendations, we hope, will be 

taken into consideration. 

40 

Accountability. I think one of the things that we discussed back 

in November was the simple fact that the pharmacists at the New 

England Compounding Center let their patients down, they let 

their system down, and they let their regulators down. We also 

now know, based on testimony back in November and then again 

most recently from Commissioner Hamburg before the House Energy and Commerce Committee, that our regulatory agencies also 

let us down. 

We need to be, in this bill, ensuring that there is accountability 

and transparency of action. Specifically, we are very concerned as 

an organization about the do-not-compound list. The Food and 

Drug Administration has had such a list since 2003. That’s the last 

time it’s been updated. That’s 10 years ago. 

We now know that there are medications that have been withdrawn from the market from traditional manufacturers that represent serious public health and safety issues. They don’t appear 

on the do-not-compound list. IACP has recommended in its comments to the committee that accountability—first and foremost, 

congressional oversight of the agency—must be included to assure 

that everyone’s feet are being held to the fire. 

Last, patient protection. Our objective as a professional organization, as pharmacists that take care of patients on a daily basis, is 

that this does not happen again. No patient, regardless of where 

they are, should expect to have any variation in the quality and 

safety of the medication they receive. 

That is one of the reasons we are also strongly opposed to any 

exemption of any type of pharmacy practice. Hold us all accountable. Hold us all to the same consistent law. And with that, all of 

us together will be ensured that we can provide patients with the 

protection that they should receive. 

Thank you, sir. 

[The prepared statement of Mr. Miller follows:] 

PREPARED STATEMENT OF DAVID G. MILLER

Good morning Chairman Harkin, Ranking Minority Member Alexander and Senate HELP Committee members. On behalf of the International Academy of 

Compounding Pharmacists (IACP), I am pleased to stand before your committee to 

offer the insights of the International Academy of Compounding Pharmacists (IACP) 

and our recommendations about the draft legislation put forward by the committee. 

Specifically, IACP wants to take this opportunity to comment on the compounding 

pharmacy legislation and how it will likely impact our industry, patients and practitioners. 

IACP applauds the steps the committee and the U.S. Senate are taking to ensure 

that compounded medications are as safe as they can be. IACP believes that the 

safety of patients must always be the first consideration of any pharmacy-oriented 

public policy. 

We have reviewed the draft and we see that there are some aspects that will need 

further discussion and refinement, and we intend to work with the committee on 

these. The draft does not contain any provisions that speak directly to USP standards, which are aimed at raising the quality of compounded medications. Additionally, IACP is concerned that some provisions may reduce patient and physician access to customized medications, the very services that compounding pharmacists 

provide. 

IACP reiterates its position that State boards of pharmacy are responsible for the 

licensing and oversight of compounding pharmacies and the FDA is responsible for 

overseeing and regulating pharmaceutical manufacturers. We think the term 

‘‘compounding manufacturer’’ and several of the definitions of that new category create more confusion and further blur the jurisdictional authority of regulators. IACP 

41 

will recommend improvements in the draft language to make the proposed categories more clear. 

Most importantly, IACP is gravely concerned that compounding pharmacies located in hospitals and health systems have been exempted from many of the proposed changes. Such an exemption denies patients and their families the assurance, 

regardless of where they receive their medications, of the quality and safety that 

they deserve. 

IACP appreciates the opportunity to work with the Senate HELP Committee to 

ensure that a tragedy like the one that occurred last year, when compounded preparations dispensed by a Massachusetts licensed pharmacy caused an outbreak of 

fungal meningitis, never happens again. It is with that crisis in mind that we have 

reviewed the draft legislation to determine if it will likely prevent a future scenario 

similar to that which occurred with NECC. 

IACP is a non-profit professional association representing more than 2,700 pharmacists, technicians, students, and members of the compounding community who 

focus on the specialty practice of pharmacy compounding. The IACP is and has been 

committed to working in collaboration with State and Federal officials to ensure the 

safe practice of pharmacy compounding. Our ultimate goal is to ensure patient safety, while ensuring continued patient access to compounded medication necessary for 

their particular medical condition. 

In December 2012, the Academy issued a series of recommended changes to State 

pharmacy laws and regulations that it believes will both enhance the protection of 

public health while preserving the professional decisionmaking of pharmacists in 

the selection and preparation of customized medication solutions. 

These proposed changes address three key areas: inspection authority and adequate funding of all State Boards of Pharmacy; compliance with laws and regulations by all pharmacists and pharmacy technicians in all practice settings, as well 

as other health care practitioners involved in compounding; and adherence to nationally recognized quality standards. As you know, many States have already been 

working to enact or establish new laws and rules governing the practice of pharmacy compounding. IACP has been actively involved in those efforts in an attempt 

to strengthen and clarify appropriate and safe pharmacy practices. As a matter of 

fact, IACP has been actively engaged in these discussions—not to lessen oversight 

on pharmacy practices, but to encourage maximum patient safety protections, while 

ensuring that compounded medications do not become distinct as a result of what 

NECC—a rogue manufacturer—did. 

IACP take strong issue with the terminology used throughout the bill to define 

the new category of manufacturer as a ‘‘compounding manufacturer.’’ Not only do 

we think this causes confusion, but it also seems to make the very practice of 

compounding synonymous with that of manufacturing. In fact, the practice of 

compounding is at the very root of pharmacy practice. Thus, IACP recommends that 

the new category be called ‘‘non-traditional manufacturing’’ and we have made those 

edits in the attached draft bill. 

We ask the committee to keep in mind that a significant number of people have 

unique health needs that off-the-shelf, one-size-fits-all prescription medicines cannot 

meet. These include children, the elderly, and those for who manufactured drug 

products are not available in the appropriate strength, dosage form, or composition. 

For them, customized medications are the only way to better health and those valuable preparations are available only by compounding. Thus, there is a medical need 

for variations in medical dosages, delivery forms, the removal of excipients, etc. for 

various patient groups. That is why the very practice of compounding exists. IACP 

urges the committee to recognize this and not prohibit physicians from prescribing 

medications needed by both their human and animal patients. 

Unfortunately, there are significant parts of the draft bill that have nothing to 

do with safety, but have to do with curtailing competition. IACP is aware that a 

good part of the anti-competitive language (not allowing dosage variations) comes 

from the large pharmaceutical manufacturers on both the human and animal side 

who wish to curtail compounding altogether. IACP hopes that the bill will remain 

focused on the end goal—that being patient safety, not getting rid of competition 

in the marketplace. It is not the time to attack compounding pharmacies from a 

commercial perspective as a result of other (monetary) motives. Safety should remain the objective of this bill. 

IACP wants to make sure that any final bill moving through the Senate balanced 

in a manner that does not restrict a doctor’s ability to prescribe and obtain compounded medications for those patients who require them as part of their necessary 

therapy. Moreover, manufacturers often discontinue a number of FDA-approved 

drugs that serve a limited population. In many of these cases, the only option left 

for doctors and their patients is to have a compounding pharmacist make the disVerDate Nov 24 2008 12:52 Mar 18, 2016 Jkt 000000 PO 00000 Frm 00045 Fmt 6633 Sfmt 6621 S:\DOCS\97957.TXT DENISE
42 

continued drug pharmaceutical grade ingredients obtained from an FDA-registered 

supplier. 

IACP remains concerned about language in the bill that further brings practices 

under the domain of manufacturing. 

(ii) that repackages a drug using sterile preservative-free single-dose vials or 

by pooling sterile drugs. 

This is problematic for several reasons. Under this language, physicians who repackage in their offices would automatically become manufacturers. Additionally, 

this language was clearly added at the behest of a pharmacy manufacturer which 

has been trying to deter doctors from prescribing one of their drugs in lieu of another of their more expensive products. This language seems to have been added for 

competitive reasons, rather than safety reasons. This provision would also include 

a large number of home infusion pharmacies who fall under these criteria (the pooling provision) for administration of parenteral nutritional therapies. They would, 

under this provision, have to register and comply with the law as a manufacturer. 

IACP strongly recommends that this section be stricken. 

While the IACP continues to strongly believe that the regulation of compounding 

should continue to be overseen by State Boards of Pharmacy and that improvements 

may need to be made to current State pharmacy laws (many States have already 

made changes, which IACP urges the Senate not to make moot), we understand the 

importance in determining what greater clarity in differentiating between drug 

compounding and drug manufacturing may be needed. 

What we find interesting about this bill is the fact that you are taking away two 

existing regulatory authorities and streamlining it under one—the FDA (whose 

track record is not at all impressive—take Ameridose and their many problems as 

an example). 

State Boards of Pharmacy, through their ongoing regular inspections, knowledge 

of unique State laws, regulations and rules, as well as having practicing pharmacists as their members who are engaged in day-to-day patient care, are in the 

best possible position to determine whether a pharmacy has exceeded its scope of 

practice or engaged in activities that may constitute manufacturing. That said, 

IACP recognizes that the oversight and regulation of prescription drug manufacturing rests with FDA, and that the Agency has the authority to identify and require the registration of any entities it believes are engaged in such activity. 

IACP believes that language should be included in the legislation which requires 

a clear (and formal) exchange of information from the FDA to the State Boards and 

in the reverse—from the State Boards to the FDA if and when a pharmacy may be 

suspected of operating outside the parameters of pharmacy practice. Efficient and 

effective communication with State Boards of Pharmacy is essential to prevent the 

Agency’s unilateral determination that a pharmacy’s professional and business activities exceed the State specified scope of practice. Without such coordination any 

proposal is unlikely to achieve its goal or to improve public health safety. 

The Academy also believes that some language contained in the bill micromanages the State Boards of Pharmacy on issues related to ‘‘office use’’ and ‘‘anticipatory compounding.’’ Since many States have already taken action to address these 

issues, IACP does not believe it is appropriate for the Federal Government to regulate the practice of pharmacy. By specifically requiring only patient-specific prescriptions as part of the ‘‘test’’, the FDA appears to circumvent those individual State’s 

laws, regulations and rules that enable prescribers to obtain compounded preparations for administration to or treatment of patients within their practices. 

Office-use dispensing is the preparation, labeling, and dispensing of a medication 

by a pharmacist and pharmacy upon the receipt of a prescription or medical order 

from an identified authorized prescriber (e.g. physician, nurse practitioner, dentist, 

veterinarian, etc.) for that prescriber’s use in the treatment of or administration to 

a patient during their normal course of medical practice. Office-use dispensing includes both manufactured prescription drug products and compounded preparations. 

Many States currently have provisions permitting office-use dispensing and other 

States are actively reviewing, clarifying, and issuing regulations on this very issue. 

Under the FDA concept, those appropriate State actions would essentially be nullified. 

With regard to anticipatory compounding, the mere act of preparing a compounded medication prior to the receipt of a valid prescription or medical order 

issued by an authorized prescriber incorrectly places the focus on the preparation, 

rather than on the dispensing, shipment or distribution of a compounded medication. The true test should be whether or not a pharmacy has distributed a prescription medication in the absence of such a prescriber directive as defined within State 

43 

law. This is a much more appropriate test as it provides a potentially more accurate 

indicator of activities that may be deemed drug manufacturing. 

IACP strongly opposes the draft bill’s exclusion of health system pharmacies. We 

would note that health systems were the primary client of NECC and they purchased these injections in large quantities, without a patient script and without a 

doctor’s order. In addition, they purchased these medications due to their low cost— 

not because of their quality. All legislation or regulation pertaining to compounding 

should cover all pharmacy practices, whether they are free-standing or located within a hospital or health care facility. There is no reason that patients within a hospital system should receive a substandard of care and safety. Indeed, many hospital 

patients assume they are more protected in health system environments when this 

has simply not been the case. ALL patient populations should be equally protected 

either within or without a hospital system. Exempting any practice site, such as 

hospitals, creates two distinctly different categories of patient safety protection. This 

is especially questionable in light of the volume and types of compounding done in 

hospital pharmacies, a substantial amount of which includes sterile compounded 

preparations. 

Additionally, by creating a large loophole in a law designed to enhance safety for 

patients, the true goal of patient care is not achieved for all patients. Additionally, 

health systems are actively purchasing and acquiring other practices—they would, 

thus, fall into a different category and would no longer have to be compliant with 

this Act. The language also creates a potential concern for the Federal Trade Commission regarding restraint of trade and one could argue that this language allows 

for an uneven playing field and potential danger to patients in those health systems. 

Please see the attached documents discussing the rate of infection in health systems 

and the sheer volume of sterile compounding done in these institutions. 

IACP urges the committee (if the goal is to truly enhance safety for all patients) 

to consider the implications of such an exemption on public safety and the perception of exempting any entity on the mere basis that it is located in a hospital or 

health care facility. While we understand that the application of any new rules and 

regulations may have to be modified to take into consideration other existing regulatory agencies and quality assurance agencies that oversee hospital safety and 

practices (i.e., the Joint Commission), such a challenge is manageable and should 

not outweigh the overall interest in ensuring patient safety. 

With respect to an identifying label, IACP has formal guidelines for its members 

that requires all compounded preparations be labeled as such so that the prescriber 

and/or patient is readily aware that the medication has been compounded. IACP 

supports the labeling language included in the draft bill. 

The IACP continues to point out that the recommendation to create and maintain 

a ‘‘do not compound’’ list by the FDA based upon patient safety already exists under 

FFDCA section 503A(d)(1). Such a list was created by the Agency and is continually 

promoted to the compounding profession by the IACP to educate its members and 

others. The Academy respectfully points out to the committee that even given such 

authority under section 503A(d)(1), the Agency has not updated the current ‘‘do not 

compound’’ list in more than 10 years. The draft bill neglects to require a regular 

review and update of this list (allowing for public comment). IACP recommends 

that—given the fact the FDA has largely let this list lapse, that such language be 

included in the bill. In fact, several manufactured FDA-approved drug products have 

been withdrawn from the market for reasons of significant threat to patient safety; 

the Agency has never included those medications on the existing ‘‘do not compound’’ 

list. IACP believes that any changes to this list must be done in an open, structured 

and, most importantly, timely manner that solicits and accepts the position and 

opinions of the medical and pharmacy community. IACP also believes that if the collective professional community and the FDA determine that a product should not 

be compounded due to evidence of patient safety, it should also not be available 

from a manufacturer. 

With regard to animal drug compounding, IACP strongly believes that the laws 

and regulations governing human compounding should be synonymous with those 

governing animal drug compounding. IACP believes that the bill should include language to statutorily permit compounding with bulk ingredients for both human and 

animals. The FDA should be allowed to continue to produce a list of permitted bulk 

drugs in food-producing animals only. IACP does not believe there should be a ‘‘positive list’’ developed by the FDA to allow certain specified ingredients from which 

animal compounds could be formulated. Rather, it should maintain the same ‘‘negative’’ list it does for the human side detailing those ingredients which have been removed from the market for safety or efficacy reasons and, thus, which should not 

be used in veterinary compounding. This would make human and veterinary 

compounding laws and regulations consistent and far less confusing. 

44 

IACP applauds the steps the committee and the U.S. Senate are taking to ensure 

that compounded medications are as safe as they can be. IACP believes that the 

safety of patients must always be the first consideration of any pharmacy-oriented 

public policy. 

We have reviewed the draft and we see that there are some aspects that will need 

further discussion and refinement, and we intend to work with the committee on 

these. The draft does not contain any provisions that speak directly to USP standards, which are aimed at raising the quality of compounded medications. Additionally, IACP is concerned that some provisions may reduce patient and physician access to customized medications, the very services that compounding pharmacists 

provide. 

IACP reiterates its position that State boards of pharmacy are responsible for the 

licensing and oversight of compounding pharmacies and the FDA is responsible for 

overseeing and regulating pharmaceutical manufacturers. We think the term 

‘‘compounding manufacturer’’ and several of the definitions of that new category create more confusion and further blur the jurisdictional authority of regulators. IACP 

will recommend improvements in the draft language to make the proposed categories more clear. 

Most importantly, IACP is gravely concerned that compounding pharmacies located in hospitals and health systems have been exempted from many of the proposed changes. Such an exemption denies patients and their families the assurance, 

regardless of where they receive their medications, of the quality and safety that 

they deserve. 

In closing, IACP applauds the committee for addressing areas of Federal law that 

may need to be updated and clarified. Again, IACP would also urge you to not lose 

sight of the fact that pharmacy compounding is vital to our health care system and 

to ensuring patient access to appropriate medications for a variety of medical conditions. We appreciate the opportunity to provide our testimony to the committee on 

its draft bill and look forward to continuing our work with you on this important 

issue. 

The CHAIRMAN. You meant in terms of intra-state as well as 

interstate? 

Mr. MILLER. Intra-state. 

The CHAIRMAN. Yes, I just wanted to make that clear. 

Dr. Thompson, welcome back. Please proceed. 

STATEMENT OF KASEY K. THOMPSON, PharmD, VICE PRESIDENT, OFFICE OF POLICY, PLANNING AND COMMUNICATIONS, AMERICAN SOCIETY OF HEALTH-SYSTEM PHARMACISTS, BETHESDA, MD 

Mr. THOMPSON. Good morning, and thank you, Chairman Harkin, Ranking Member Alexander, and distinguished members of 

the committee, for holding this hearing. My name is Kasey Thompson, and I serve as vice president for Policy, Planning, and Communications with the American Society of Health-System Pharmacists. 

I’m here today to provide ASHP’s perspective on the committee’s 

draft proposal on pharmaceutical compounding. 

As stated in previous testimony, in the interest of patient safety, 

ASHP supports closing the regulatory gaps for a category of commercial compounding outsourcers we are now referring to as 

compounding manufacturers. We applaud the committee’s efforts to 

accomplish closing these gaps. 

We believe this proposed legislation addresses the regulatory uncertainties that were caused through various challenges to Section 

503(A) of the Food and Drug Administration Modernization Act of 

1997. Importantly, the committee’s proposal leaves traditional 

compounding as a core component of the practice of pharmacy 

under the purview of State boards of pharmacy. 

ASHP strongly supports the creation of a category known as 

compounding manufacturer, which would fall completely within the 

45 

purview of the FDA. We further agree that not allowing a 

compounding manufacturer to register as a pharmacy in any State 

establishes a clear boundary between FDA jurisdiction and the jurisdiction of State boards of pharmacy. Being under the purview of 

the FDA gives the public the certainty of knowing exactly which 

regulatory body is accountable and will help prevent an entity like 

the New England Compounding Center from inappropriately operating as a pharmacy ever again and harming our patients. 

The proposed legislation assures hospital and health system 

pharmacists, physicians, and other purchasers of compounded products that compounding manufacturers that prepare sterile products 

have taken the necessary steps to ensure their facilities meet the 

most rigorous current good manufacturing practices, have been inspected by the FDA, and, most importantly, do not pose a threat 

to the patients due to inadequate regulatory oversight. 

ASHP agrees that commercially available products should not be 

compounded except to meet specific medical needs or if they are 

placed by the FDA on its drug shortage list. Furthermore, there 

should not be any loopholes in the law that would enable an entity 

to circumvent the drug approval process. We believe that the current drug approval process for new and generic drugs should be 

preserved as the gold standard and in no way minimized or circumvented. 

ASHP supports the provision that exempts health systems from 

being designated as compounding manufacturers. We believe it is 

critical to make the distinction between health systems, which are 

fully accountable for the comprehensive care of the patient, and a 

compounding manufacturer that prepares and sells its products 

across State lines without a prescription or knowledge of the patient to a third party for administration. 

In a hospital or health system, the same entity that compounds 

the medication is also responsible for the care of the patient. No 

medication compounded or otherwise prepared is administered to 

the patient unless there is a patient specific medication order. 

Compounded medications prepared by pharmacy departments 

and all other medications used in hospitals and health systems are 

prescribed or ordered based on established relationships with the 

medical staff and other prescribers, all of whom are formally 

credentialed and privileged by the hospital or health system. Further, hospitals and health systems are not engaged in the retail 

sale of compounded products to other entities, but instead prepare 

and purchase compounded products for use on the patients being 

cared for in their hospital, health systems, and clinics. 

Now, in the highly unlikely event that a hospital or health system ever did want to sell a sterile compounded product by engaging 

in interstate commerce to an outside entity that is not part of their 

system, then we believe the proposed legislation as it is currently 

written would require them to become listed as a compounding 

manufacturer, which we would support. 

What makes this scenario highly unlikely is that a hospital or 

health system that becomes a compounding manufacturer would 

then not be allowed to be a pharmacy, which would prevent them 

from accomplishing their patient care mission. Hospitals are in the 

business of caring for patients, not manufacturing pharmaceuticals. 

46 

Hospitals also have pharmacy and therapeutics committees comprised of medical, administrative, and pharmacy staff that allow 

safe and effective products to be placed on their approved drug 

formularies. They also have well-established quality improvement, 

infection control, and risk management committees, as well as adverse event monitoring and reporting systems. 

Another distinguishing factor for health systems is that they 

must comply with CMS Hospital Conditions of Participation and 

are accredited by quality improvement organizations such as the 

Joint Commission. These are just a few of the examples of how hospitals and health systems function differently from other care settings and are, therefore, appropriately excluded from the class of 

compounding manufacturer in the draft legislation. 

In closing, I want to thank you, Chairman Harkin and Ranking 

Member Alexander, for the bipartisan leadership that you have 

demonstrated in the interest of protecting the public health and for 

holding this hearing and putting forth a thoughtful and well-developed proposal. ASHP believes this proposal provides the proper 

pathway forward to protect patients and to ensure that a harmful 

event like the meningitis outbreak of 2012 will never happen again. 

We are completely committed to working with you and the committee to see that this legislation gets passed into law. 

Thank you. 

[The prepared statement of Mr. Thompson follows:] 

PREPARED STATEMENT OF KASEY K. THOMPSON, PHARMD 

SUMMARY

The American Society of Health-System Pharmacists (ASHP) supports the draft 

legislation put forth by the Senate Committee on Health, Education, Labor, and 

Pensions in the wake of the Meningitis Outbreak of 2012 caused by tainted sterile 

products prepared by the New England Compounding Center. We believe the draft 

addresses the regulatory uncertainty that currently exists between State boards of 

pharmacy and the Food and Drug Administration (FDA) over sterile preparation entities that engage in interstate commerce of their products and do so without a prescription. In addition, the committee’s proposal leaves traditional compounding as 

a core component of the practice of pharmacy under the sole purview of the State 

boards of pharmacy. 

ASHP strongly supports the creation of a category known as ‘‘compounding manufacturer,’’ which would fall completely within the purview of FDA. We further agree 

that not allowing a compounding manufacturer to register as a pharmacy in any 

State establishes a clear boundary between FDA jurisdiction and the jurisdiction of 

State boards of pharmacy. The proposed legislation assures hospital and health-system pharmacists, physicians and other purchasers of compounded products that 

compounding manufacturers that prepare sterile products have taken the necessary 

steps to ensure their facilities meet rigorous standards and have been inspected by 

the FDA. 

ASHP supports the provision that appropriately exempts health systems from 

being designated as a compounding manufacturer. Hospitals are fully accountable 

for the comprehensive care of their patients and do not introduce compounded products into interstate commerce. Further, we support the do not compound list, user 

fees, adverse event reporting, and the prohibition of compounding commercially 

available drugs except for those in shortage. 

Good morning and thank you Chairman Harkin, Ranking Member Alexander, and 

distinguished members of the committee, for holding this hearing. My name is 

Kasey Thompson, and I serve as vice president of Policy, Planning and Communications at the American Society of Health-System Pharmacists (ASHP). I am here 

today to provide ASHP’s perspective on the committee’s draft proposal on pharmaceutical compounding. 

47 

As stated in previous testimony, in the interest of patient safety, ASHP supports 

closing the regulatory gaps for a category of commercial compounding outsourcers 

that we now refer to as ‘‘compounding manufacturers,’’ and we applaud the committee’s effort to accomplish closing these gaps. 

We believe this proposed legislation addresses the regulatory uncertainties that 

were caused through the various challenges to Section 503A of the Food and Drug 

Administration Modernization Act of 1997. Importantly, the committee’s proposal 

leaves traditional compounding as a core component of the practice of pharmacy 

under the sole purview of State boards of pharmacy. 

ASHP strongly supports the creation of a category known as ‘‘compounding manufacturer,’’ which would fall completely within the purview of FDA. We further agree 

that not allowing a compounding manufacturer to register as a pharmacy in any 

State establishes a clear boundary between FDA jurisdiction and the jurisdiction of 

State boards of pharmacy. Being under the purview of the FDA gives the public the 

certainty of knowing exactly which regulatory body is accountable, and will help 

prevent an entity like the New England Compounding Center from inappropriately 

operating as a pharmacy ever again. 

Simply put, we believe the committee got it right with this proposed legislation. 

The proposed legislation assures hospital and health-system pharmacists, physicians, and other purchasers of compounded products that compounding manufacturers that prepare sterile products have taken the necessary steps to ensure their facilities meet the most rigorous Current Good Manufacturing Practices, have been inspected by the FDA, and most importantly, do not pose a threat to our patients due 

to inadequate regulatory oversight. 

Under the proposal, health care providers will have the assurance that if they 

purchase an out-source sterile product from a compounding manufacturer, wherever 

it is located throughout the country, that the product they purchase has come from 

an FDA-inspected and FDA-approved facility. We also agree that a compounded 

drug sold to a health care entity by a compounding manufacturer should be labeled 

‘‘not for resale.’’ 

ASHP agrees that commercially available products should not be compounded except to meet specific medical needs or if they are placed by the FDA on its drug 

shortage list. Furthermore, there should not be any loopholes in the law that would 

enable an entity to circumvent the drug approval process. We believe that the current approval processes for new and generic drugs should be preserved as the gold 

standard, and in no way minimized or circumvented. 

ASHP supports the provision that exempts health systems from being designated 

as compounding manufacturers. We believe it is critical to make the distinction between health systems—which are fully accountable for the comprehensive care of 

the patient—and a compounding manufacturer that prepares and sells its products 

across State lines without a prescription or knowledge of the patient to a third party 

for administration. 

In a hospital or health system, the same entity that compounds the medication 

is also responsible for the care of the patient. No medication, compounded or otherwise prepared, is administered to the patient unless there is a patient-specific medication order. Compounded medications prepared by pharmacy departments and all 

other medications used in hospitals and health systems are prescribed or ordered 

based on established relationships with the medical staff and other prescribers, all 

of whom are formally credentialed and privileged by the hospital or health system. 

Further, hospitals and health systems are not engaged in the retail sale of compounded products to other entities, but instead prepare and purchase compounded 

preparations for use on the patients being cared for in their hospital, health system, 

and clinics. 

Hospitals also have Pharmacy and Therapeutics Committees comprised of medical, administrative, and pharmacy staff that only allow safe and effective products 

to be placed on their approved drug formularies. They also have well-established 

quality improvement, infection control, and risk management committees as well as 

adverse event monitoring and reporting systems. Another distinguishing factor for 

health systems is that they must comply with CMS Hospital Conditions of Participation, and are accredited by quality improvement organizations such as The Joint 

Commission and DNV Healthcare, both of whom have deemed status with Medicare. 

These are just a few examples of how health systems function differently than other 

care settings and are therefore appropriately excluded from the class of 

compounding manufacturers in the draft legislation. 

We support the definition of ‘‘health system’’ in the provision in the bill that defines traditional compounder. However, it may need to be revised to reflect contemporary health systems that include ambulatory clinics and infusion centers under 

their common control. We have submitted comments to the committee that raise 

48 

this point and look forward to working with other hospital organizations and committee staff to resolve this need for language that reflects the various components 

of today’s health systems. 

ASHP supports the provisions in the draft legislation that grant FDA the authority to designate a list of drugs that should not be compounded. There are complex 

medications with mechanisms of action or delivery systems that should not ever be 

compounded. In addition, we agree that the FDA should identify bulk substances 

that should not be used in compounding. 

We agree with the draft language requiring compounding manufacturers to report 

adverse drug events to the FDA MedWatch program and to have a licensed pharmacist directly supervising the compounding operations. 

Finally, we support the establishment of user fees for compounding manufacturers 

in order to provide the FDA with adequate resources to regulate their activities. We 

also ask that Congress continue to consider increasing FDA’s budget appropriation 

so that it can fulfill its vast global public health mission. 

In closing, I want to again thank you Chairman Harkin and Ranking Member 

Alexander for the bipartisan leadership you have demonstrated in the interest of 

protecting the public health, and for holding this hearing and putting forth a 

thoughtful and well-developed legislative proposal. ASHP believes this proposal provides the proper pathway forward to protect patients and ensure that a harmful 

event like the meningitis outbreak of 2012 will never happen again. We are completely committed to working with you to help get this important legislation passed 

into law. 

Thank you. 

The CHAIRMAN. Thank you very much, Dr. Thompson. 

We’ll now start a round of 5-minute questions. I’ll start with Mr. 

Catizone and go right down. 

Does this legislation create a clear line regarding which entities 

FDA would regulate? 

Mr. CATIZONE. Yes, sir. 

The CHAIRMAN. Mr. Coukell. 

Mr. COUKELL. Yes. 

The CHAIRMAN. Mr. Miller. 

Mr. MILLER. Yes, with some definitions. 

The CHAIRMAN. Dr. Thompson. 

Dr. THOMPSON. Yes. 

The CHAIRMAN. Does the draft provide FDA the tools it needs in 

terms of both authorities and resources to oversee the pharmaceutical compounding? 

Mr. CATIZONE. Yes, sir. 

Mr. COUKELL. It provides some of the tools and a mechanism for 

resources. As I mentioned in my testimony, we think that the FDA 

may need greater access to records to be able to oversee the facilities it is charged with. 

The CHAIRMAN. Mr. Miller. 

Mr. MILLER. We believe so. 

The CHAIRMAN. And Dr. Thompson. 

Dr. THOMPSON. We think it provides the adequate resources 

through user fees. However, we continue to have concerns about 

the general funding to the FDA through appropriations to fulfill its 

public health mission, in general. 

The CHAIRMAN. We all have that concern. 

Mr. Catizone, let me ask you this now. When a State identifies 

a problem with a compounding pharmacy that is regulated by another State, what’s the best way for that problem to be communicated to the regulating State? Does FDA have a role? Should the 

States talk directly to each other? Is this where the National AssoVerDate Nov 24 2008 12:52 Mar 18, 2016 Jkt 000000 PO 00000 Frm 00052 Fmt 6633 Sfmt 6601 S:\DOCS\97957.TXT DENISE
49 

ciation of Boards of Pharmacy could be helpful? Help me to think 

this thing through. 

Mr. CATIZONE. Yes, sir. Prior to the NECC situation, that communication channel was not effective. What we’ve now done is built 

the communication channels between the States through NABP, so 

when that happens, it’s immediately reported to us, and we report 

it to all the other States. We will continue to implement and operate that system. 

The CHAIRMAN. There is one lingering thing here, and maybe between Mr. Miller and Dr. Thompson—I can’t remember exactly 

who. But Mr. Miller has testified that health systems should not 

be exempt—that we should put them all together—from being 

compounding manufacturers. Dr. Thompson testified in support of 

the exemption. 

Mr. Catizone, where do you weigh in on this? 

Mr. CATIZONE. We support the exemption because of the safety 

nets and oversight processes that exist within that shared one-ownership system among the hospitals. 

The CHAIRMAN. Mr. Coukell, do you have a view on this? 

Mr. COUKELL. If the question is whether a hospital pharmacy 

should be a pharmacy or a compounding manufacturer, clearly, 

they should be a pharmacy. As Dr. Thompson has mentioned, there 

are a number of additional mechanisms within a health system 

that ensure quality. 

The CHAIRMAN. I’m not sure I understand that. If they are 

compounding, if a hospital is compounding, and they’re not shipping it interstate or anything like that, but it’s within their system, 

should they be exempted from being a compounding manufacturer? 

Mr. COUKELL. Yes. We support the exemption. 

The CHAIRMAN. I see. 

Mr. Miller, you don’t? Or what? 

Mr. MILLER. If we go upon the definitions that have been created 

in the draft legislation to define a compounding manufacturer—the 

preparation of a sterile medication, the dissemination of that product intra-state, and without a previously issued prescription—then 

it doesn’t matter whether that’s a community-based pharmacy or a 

pharmacy that’s affiliated with a health system. It should be consistently applied across the board. That is how you’ve defined a 

manufacturer as opposed to a traditional compounding pharmacy, 

be it local, be it in a hospital. I think we need to keep consistent. 

The CHAIRMAN. Dr. Thompson. 

Dr. THOMPSON. We clearly support the exemption. And, as I 

noted, I don’t think hospitals are completely exempt here. If a hospital were to engage in preparing a product for commercial sale, 

and they sold that outside of their system, clearly, they should be 

required to be registered as a compounding manufacturer. 

The CHAIRMAN. We understand that. But I think Mr. Miller is 

talking about a hospital that compounds for its own internal use. 

Dr. THOMPSON. Yes. I don’t agree with that, obviously. I mean, 

I think a hospital that—— 

The CHAIRMAN. Why shouldn’t they? Give me some help here. 

Why not? 

Dr. THOMPSON. As I just stated in my testimony, a hospital is 

fully accountable for the care of that patient. This is an apples to 

50 

oranges comparison. A hospital is not a manufacturer. A hospital 

is a patient care entity that’s preparing a product and doing procedures for the patients they serve. They’re not preparing large 

amounts of product and storing it in a warehouse for long periods 

of time. They’re preparing that product in clean room conditions, 

taking it to the floor, administering it to that patient by licensed 

healthcare professionals that are accountable for that patient. 

The CHAIRMAN. Do you have anything to add to that, Mr. Miller? 

Mr. MILLER. Fundamentally, Mr. Chairman—and I thank you for 

pushing this issue. We have an image of a hospital as being the 

red brick building in our local community, and that’s where hospital pharmacists practice, and we take care of patients within the 

facility. Today’s modern health system is markedly different. For 

example, Johns Hopkins University now has hospitals throughout 

the State of Maryland, clinics, and home infusion and long-term 

care subsidiaries that operate throughout the mid-Atlantic region. 

If we are to stop what happened at NECC where a business 

shipped medications interstate without prescriptions and not following the State law, whether that was a hospital pharmacy transferring it from the Baltimore campus to a clinic in Richmond, VA, 

we believe that that action is the same as you have defined for a 

compounding manufacturer. 

My colleague at ASHP referenced retail or commercial sale. It 

shouldn’t matter whether it’s a sale associated with dollars. It is 

the movement and accountability of who is responsible ultimately 

for that medication. So, no, we would oppose the exemption. 

Mr. CATIZONE. Mr. Chairman, may I add, please? 

The CHAIRMAN. Mr. Catizone, my time has run out, but—fine. Go 

ahead. 

Mr. CATIZONE. Two quick points as to why we think it should be 

exempted. No. 1, there is a patient prescription. It’s within that 

closed system. It exists. Every aspect of that prescription is reviewed by the hospital. Drug interactions and contraindications are 

reviewed prior to that being dispensed. 

No. 2, there are systems within that hospital system to make 

sure the product is properly prepared. And if there’s a problem, 

there are infectious disease committees and other mechanisms to 

contain that within that system, react to that, identify the cause, 

and act appropriately. 

The CHAIRMAN. Thank you. My time has run out. 

Senator Alexander. 

Senator ALEXANDER. Mr. Catizone, just so I understand our own 

draft here, if I’m a local drugstore in Tennessee, and I’m 

compounding a drug, and it’s a sterile drug, and I have a specific 

prescription, and it’s not on the do-not-compound list, I can still do 

that. Is that correct? 

Mr. CATIZONE. Yes, sir. 

Senator ALEXANDER. Is that right, Mr. Miller? 

Mr. MILLER. Yes, sir. 

Senator ALEXANDER. So we’re not interfering with that with the 

draft bill. 

Mr. Catizone, you say that you think the FDA also ought to take 

over the shipment within a State, intra-state shipment, of sterile 

compounded drugs without a prescription. 

51 

Mr. CATIZONE. Yes, sir. 

Senator ALEXANDER. Do you want to amplify that? 

Mr. CATIZONE. Yes, sir. As I said, we’ve been in over 150 pharmacies, and we’ve seen intra-state pharmacies as well as interstate 

pharmacies, and the risks are the same—large quantities, not following standards. And so if we just exempt the intra-state, we’re 

going to put people at risk in that State to the same problems that 

we encountered before this incident. 

Senator ALEXANDER. Mr. Miller, do you have an opinion? 

Mr. MILLER. Senator Alexander, I’m sorry, but I feel like I’m on 

your flagpole, because that was a point you made before today and 

back in November. Intra-state shipment, intra-state compounding, 

is regulated by the State board of pharmacy. 

Senator ALEXANDER. Within a State. 

Mr. MILLER. Within, intra. That’s right. And that’s how the staff 

has worked, and this draft legislation appears to adequately define 

a traditional compounder. I disagree with my colleague at NABP. 

If it’s intra-state, it belongs to the State. 

At the same time, the minute it goes over the State line, then 

we have someone else on the flagpole, and that becomes the Food 

and Drug Administration. And that’s, again, why we disagree with 

the concept of exempting a hospital. You move it out of the State, 

over the State line, that’s when it becomes somebody else’s regulatory authority. 

Senator ALEXANDER. Mr. Catizone, you thought the FDA 

should—basically, there are some things in the draft that the FDA 

still could do with local drugstores that you thought ought to be out 

of the draft. Right? 

Mr. CATIZONE. Yes, sir. 

Senator ALEXANDER. Say that again. And I gather your point was 

that—that was the clarity point, to keep them—either they’re going 

to be there, or they’re not going to be there. Was that it? 

Mr. CATIZONE. Yes, sir. 

Senator ALEXANDER. Say that again. 

Mr. CATIZONE. Yes, sir. By allowing the FDA access to records 

and giving them some authority over the State regulated activities, 

that’s going to cause confusion. And let me use Dr. Miller’s example that he used with the hospital exemption. If they’re engaged in 

manufacturing, whether it’s a hospital or a community pharmacy, 

he said that they should be regulated the same. 

We’re making the same contention with the exemption for intrastate. If they’re manufacturing, they’re not compounding. If there’s 

not a prescription, and if it’s sterile, it’s not compounding. If they’re 

compounding intra or inter, that should be State authority. But if 

they’re manufacturing, inter or intra, that’s the FDA. 

Senator ALEXANDER. But on the first point, you say that if the 

FDA is given the authority to come in and inspect records of a local 

pharmacy that it doesn’t otherwise regulate, that that adds confusion. 

What do the rest of you think about that point? 

Mr. COUKELL. I think if the Agency goes into a pharmacy as it 

does now, and it sees a product sitting in a sterile hood, they can’t 

tell by looking at that product whether there’s a prescription, 

52 

whether it’s being sold across State lines. So it’s hard to carry out 

the responsibilities here without the ability to access those records. 

Senator ALEXANDER. Mr. Miller, Dr. Thompson. 

Mr. MILLER. Two thoughts, Senator. First, section 704(A) has 

been in the statute since 1962, and the Agency has always had the 

ability through a regulatory administrative practice to obtain a 

court order or a subpoena or an administrative warrant to access 

those records. In the current environment, the State boards of 

pharmacy, who already have access to those records, are in cooperation with the FDA. We don’t believe additional changes to a 

statute that has actually worked for a very long time are really 

mandated. 

Senator ALEXANDER. Dr. Thompson. 

Dr. THOMPSON. I think records, for the sake of inspecting records, 

should stay within the State. I think if the FDA has cause, if 

there’s an identified risk, a contamination or something like that, 

that they shouldn’t be prohibited from inspecting records. 

Mr. CATIZONE. Senator Alexander, could I just add one point, 

please? 

Senator ALEXANDER. Yes. 

Mr. CATIZONE. The FDA has justification for making this request. So I would ask a consideration of the committee and then 

make a commitment to the committee. The States have not followed through in making that distinction between compounding 

and manufacturing in all the cases. And the FDA has been faced 

with dealing with that situation, and that’s why they’re requesting 

access. We see that situation, and we know we have to work with 

the States to repair that. 

The consideration is the legislation as written is excellent. If we 

can move forward, and we can work with the States to repair that 

situation, then we would like a try to do that. If we can’t, the commitment we’re making is that we would come back to this committee and say, ‘‘The States have failed. They’re not doing what 

they’re supposed to be doing in this regard. Please turn this over 

to the FDA.’’ 

Senator ALEXANDER. Mr. Chairman, I want to ask just one question of Mr. Miller. 

Mr. Miller, do you support this new category of compounding 

manufacturing? Do you just object to the name, or do you object to 

the new category? 

Mr. MILLER. No, sir. We kind of object to the name, which is why 

we refer to them as a non-traditional manufacturer. 

Senator ALEXANDER. But you don’t object to the new category as 

a way to create accountability. 

Mr. MILLER. With some minor modifications to the definitions. 

The conceptual—absolutely. In fact, in our original testimony and 

as we have consistently stated, the FDA has authority over drug 

manufacturing in the United States, period. There’s no question 

about that. We need to refine that flagpole, or that bright, clear 

line that says when does a compounding pharmacy exceed its scope 

of practice, as was the case in Massachusetts. 

The board of pharmacy makes that determination and says, 

‘‘You’re a manufacturer. You’re no longer being a pharmacist.’’ And 

that is the privilege of the board to tell me when my license has 

53 

been exceeded, and then turn me over to the FDA as a manufacturer. 

The CHAIRMAN. Senator Warren. 

Senator WARREN. Thank you, Mr. Chairman. I just want to examine some more of the role that State boards should play in overseeing the traditional compounding pharmacies. Obviously, this 

law anticipates that for intra-state work, this is going to be done 

entirely at the State level, and the same for interstate shipment of 

non-sterile products. 

So following the outbreak at NECC in Massachusetts and the 

terrible events that resulted from that, my colleague, Congressman 

Ed Markey, from Massachusetts and his colleagues in the house 

launched an investigation just to determine what State pharmacies 

are doing in terms of overseeing these compounding labs. 

I just want to read you some of the findings from the Markey report. 

‘‘No State boards of pharmacy require the pharmacies to disclose the amount of drug they are compounding or whether 

they’re sold across State lines. Thirty-seven State boards don’t 

track which pharmacies are performing sterile compounding. 

On average, States employ five inspectors with responsibility 

for inspecting all pharmacies, including the compounding pharmacies.’’ 

That’s five. 

In Massachusetts, that’s 1,179 pharmacies. In larger States, the 

number can be upwards of 2,000 pharmacies, with five inspectors, 

on average. And here’s the one that really got me. ‘‘Less than a 

quarter of the State boards provide inspectors any training to detect problems with sterile compounding.’’ 

So, given that that’s the current state, my question is: What permanent changes do the States need to make in order to coordinate 

with the Federal law so that we really have some assurance that 

we have a comprehensive system that keeps all of our patients 

safe? 

You’re nodding your head, Mr. Miller. So I’ll start with you. 

Mr. MILLER. Thank you, Senator Warren. And I have to tell you 

the Commonwealth of Massachusetts actually had in place some of 

the best and most restrictive compounding pharmacy laws in the 

entire country. It is, indeed, a tragedy that this pharmacy intentionally concealed some of its actions from both State and Federal 

inspectors, and then even more so continued to operate in violation 

of those laws. How do we fix this? 

Senator WARREN. But I have to interrupt you there, Mr. Miller, 

just to point out that we’ve done subsequent inspections and found 

that there continue to be—even after this tragedy, even after all 

the heightened awareness, there continue to be substantial violations of the basic rules of keeping these products clean and safe for 

consumers. So this is not a one off that we have a problem with. 

Mr. MILLER. No, I agree. Within the Commonwealth itself, and 

also in some of the other States, as Congressman Markey’s report 

showed, we did not have regular inspections of compounding pharmacies. What we are seeing now in Massachusetts and in other 

States—where the boards are taking this seriously, hiring the necessary individuals with the proper training to conduct those inspecVerDate Nov 24 2008 12:52 Mar 18, 2016 Jkt 000000 PO 00000 Frm 00057 Fmt 6633 Sfmt 6601 S:\DOCS\97957.TXT DENISE
54 

tions—is that we are uncovering things that should have been uncovered long ago. 

So IACP, as a professional organization, immediately, in the fall, 

began putting out positions that our States need to take, fully fund, 

and hold our boards of pharmacy accountable for performing their 

responsibility, which is protecting the patients within the State. 

Senator WARREN. And how many States are now in compliance 

with your suggestions? 

Mr. MILLER. I don’t know how many we have right now, Senator, 

because, as I mentioned before, we literally have bills rolling 

through various State legislatures. Maryland just passed theirs 2 

weeks ago. Maine just introduced theirs 2 weeks ago. So it’s something that is definitely in process. 

Senator WARREN. Do you know that it’s in process in all 50 

States? 

Mr. MILLER. Yes. That I can tell you. It is. 

Senator WARREN. So we know it’s in process. Here’s what I want 

to know. What assurance do we have that what happens will be 

adequate, that it will happen in every State, and that there will 

continue to be enforcement after the lights have dimmed and the 

tragedy has faded from the memory of many people? 

Mr. MILLER. Senator, I think that’s a challenging question from 

the standpoint that those of us who are involved in this today will 

not forget it. Our boards of pharmacy, the individual pharmacists, 

the professional and public members that serve on those boards are 

committed to ensure that the systems are put into place—and I 

know Dr. Catizone can talk about that a little bit better than I 

can—that we set up a system that does not allow this to continue. 

I do believe, however, you’re right in asking the question: How 

do we know 10 years from now that we don’t slack off? 

Senator WARREN. We’re not even to the point of slacking off. We 

haven’t gotten there to be able to think about slacking off yet. And 

I want to ask if there is anything in the Federal law that says we 

will depend only on the States that have passed adequate laws to 

make sure that there is full safety for our patients. In other words, 

if the States fail to act, if there are loopholes, if only some of the 

States act, we’re still going to be relying on those States. Is that 

right, under the statute that—— 

Mr. MILLER. With the regulation of the practice of pharmacy and 

the issuance of licenses for pharmacies and pharmacists, yes, you 

will continue to be reliant upon the States. 

Senator WARREN. So we are only assuring patient safety in cases 

in which the State acts as well as the Federal Government acting. 

Is that right? 

Mr. CATIZONE. No. 

Senator WARREN. I’m getting yeses and nos. I’m sorry. I’m over 

my time, Mr. Chairman, but perhaps this is something we should— 

is that all right? 

Go ahead, Mr. Catizone. 

Mr. CATIZONE. Sure. The answer is no, and I think this is a very 

complex issue, but it can be broken down into very basic concepts. 

And I think Congressman Markey’s report emphasize that and 

your questions do as well. If it’s manufacturing, it’s going to reVerDate Nov 24 2008 12:52 Mar 18, 2016 Jkt 000000 PO 00000 Frm 00058 Fmt 6633 Sfmt 6601 S:\DOCS\97957.TXT DENISE
55 

quire GMPs and the FDA, whether it’s intra-state or interstate. 

That mechanism is being built. 

Senator WARREN. I understand. 

Mr. CATIZONE. If it’s traditional compounding, it’s going to involve USP standards and the current State practice acts and regulations, which were not the problems with the NECC situation. It 

was the manufacturing of those products outside of that regulation. 

So the States are building the systems. They can regulate that. 

We’re building the resources around them with it. If the FDA can 

do intra and interstate, you will have a permanent mechanism and 

the States will deal with it day to day. 

Senator WARREN. I think we have a different response here. 

Mr. COUKELL. Senator, the proposal will bring some facilities 

under FDA oversight using three tests, one of which is interstate 

sale. So facilities that sell within a single State that operate at the 

same scale would continue under State jurisdiction. One of the 

things that we heard strongly at the pharmacy compounding summit that we co-hosted with ASHP and the NABP participated in is 

that States vary widely in their ability to oversee this large-scale 

production. No doubt, there’s activity going on, but it’s very variable. 

Senator WARREN. So you’re telling me that we really have some 

serious gaps there, potentially. 

Mr. COUKELL. Potentially. 

Senator WARREN. Thank you very much. 

Sorry, Mr. Chairman. 

The CHAIRMAN. That’s all right. Thank you, Senator Warren. 

Senator Roberts. 

Senator ROBERTS. Thank you, Mr. Chairman. 

Thanks to all the panel members. I know you’re busy, and to 

come here—this has been very helpful, I think, as we get into all 

the ramifications of the draft bill. We really tried very hard to ensure that we don’t make laws after this 10-year effort without 

knowing the impacts, such as restricting patient access to lifesaving medications. 

I know that the regulatory process in Washington is such that 

it’s probably the No. 1 issue in my State in regards to overkill— 

sub-regulatory guidance, people not even knowing about it, final 

rules that happen within 30 days, Executive orders, so on and so 

forth. The President even has an Executive order that says we desperately need for all the agencies—that you put up a yardstick in 

regards to cost and benefit, and I appreciate all of you trying to 

help us in that respect. 

Mr. Miller, thank you especially. I thought there in 2007 that 

we’d end up on Front Street with guns drawn, but you put yours 

in the holster, and I have all your comments right here. And I have 

your—you mentioned definitions. They’re in italics so they stand 

out, and this committee will go over your definitions. I’m glad to 

have you on the stagecoach. I don’t know who’s driving. Hopefully, 

we’re driving the stage, and you can ride shotgun and make sure 

everything is OK. So we’re going to do that. 

I was going to ask you all if you’re satisfied with the level of 

stakeholder input that has been allowed throughout the drafting 

process. All of your answers are yes. That saves a lot of time. 

56 

I’m caught up with the comments by Senator Warren and Senator Enzi. The local pharmacist does not need Federal inspectors 

going around the State. Let me point out that the FDA has already 

inspected about 30 pharmacies based on solid evidence of misconduct. You can work with the State board and gain access to 

records. You can work, as Mr. Miller has pointed out, by simply 

going through the warrant process. 

You can get a warrant, you can work with the State board, and 

I think you could probably go into any pharmacy that has a very 

bad record, a lot of complaints, a lot of problems—hopefully not a 

medical disaster like we had with meningitis. And since FDA is already going into about 30 pharmacies—and I think they were 

prompted by that when I asked them why they’re not—you can do 

this. 

Now, Mr. Miller, there is a situation with Children’s Mercy Hospital. They’re located in Missouri, and they’re a very well-known 

hospital and do amazing work. Four blocks away in Kansas, there 

is an annex to that. Guess what, by your definition, is going to happen? They’re under the Missouri State Pharmacy Board, but under 

your suggestion, they would be put in this one category. I can’t 

imagine you’d want to do that. 

Mr. MILLER. The pharmacy on the Missouri side has a license 

issued by the State of Missouri. 

Senator ROBERTS. That’s correct. 

Mr. MILLER. The pharmacy or the hospital on the Kansas side 

has a license issued by the State of Kansas. 

Senator ROBERTS. Right. 

Mr. MILLER. For all intents and purposes, that is, going back and 

forth, interstate. So would we expect that the preparation of a 

medication on the Missouri side transferred over across State— 

and, believe me, I’m from this area, so we go back and forth 

amongst States all the time. If it is for an individual patient and 

labeled as such—and that’s what we’ve included as one of our recommendations in the exemption language—then we’re fine. 

If, however, the pharmacy on the Missouri side is preparing 

bulk—lots of sterile drugs to send down the street without any patient prescriptions prior to—that, essentially, is a duplicate of the 

definition of what we have for all other compounders. 

Senator ROBERTS. All right. You made that clear. Let me just add 

that it was Quantrill who came in from Missouri to Kansas. We 

would never do that in Kansas, going the other way. 

[Laughter.] 

Mr. MILLER. As long as I’m not invited to Dodge City, I’m happy. 

Senator ROBERTS. OK. 

Thank you all for coming. I think my time is up, and I’ve used 

enough time, Mr. Chairman. Thank you so much. 

Thank you all for your input. 

Mr. MILLER. Thank you, sir. 

The CHAIRMAN. Thank you all very, very much. This has been 

very informative, and I think I can safely say that no one has to 

be taken to Dodge City after this hearing. But I just want to thank 

you all very much. 

Just in hearing the testimonies and the Q&As back and forth, I 

think we’re pretty close. I think we’re pretty close. We’ll look at 

57 

some of the definitional things that you’ve suggested. When I hear 

that, I always think what’s in a name, but sometimes, there’s more 

than I think in a name. I don’t know. 

But I think we’re pretty close. Our staffs will work together 

again as we have in an open system and resolve what little matters 

need to be resolved. But I think from the general tone of what I 

hear, I think we’re very, very close to knowing what we need to do. 

Hopefully, again, working with Senator Alexander and others, we 

can have a markup sometime soon and move this legislation. 

With that, the record will remain open for 10 days to allow members to submit questions and statements for the record. Thank you 

again very, very much for everything, and the committee will be 

adjourned. 

58 

ADDITIONAL MATERIAL 

RESPONSE TO QUESTIONS OF SENATOR ENZI BY JANET WOODCOCK, M.D., CARMEN S. 

CATIZONE, M.S., RPH, DPH, ALLAN COUKELL, AND KASEY K. THOMPSON, PHARMD 

DEPARTMENT OF HEALTH & HUMAN SERVICES, 

FOOD AND DRUG ADMINISTRATION, 

SILVER SPRING, MD 20993, 

November 26, 2013. 

Hon. TOM HARKIN, Chairman, 

Committee on Health, Education, Labor, and Pensions, 

U.S. Senate, 

Washington, DC 20510–6300. 

DEAR MR. CHAIRMAN: Thank you for providing the opportunity for the Food and 

Drug Administration (FDA or the Agency) to testify at the May 9, 2013, hearing before the Committee on Health, Education, Labor, and Pensions entitled ‘‘Pharmaceutical Compounding: Proposed Legislative Solution.’’ This letter provides a response for the record to a question posed by Senator Mike Enzi, which we received 

on May 28, 2013. 

If you have further questions, please let us know. 

Sincerely, 

SALLY HOWARD, 

Deputy Commissioner, 

Policy, Planning, and Legislation. 

SALLY HOWARD FOR JANET WOODCOCK, M.D. 

Question. FDA’s comments on the discussion draft state that the Agency ‘‘must 

have access to records at traditional compounders’’ to enable the Agency to investigate traditional pharmacies who compound for potential violations of the new law. 

However, FDA has stated previously that traditional pharmacy must be preserved 

and FDA has previously never had access to pharmacy records to conduct enforcement actions. Can you please explain to me why FDA now believes that access to 

the records of traditional pharmacists is so necessary? 

Answer. It is critical that FDA have clear authority to inspect pharmacies to determine the scope and nature of their operations to determine whether they are operating as compounding pharmacies or conventional drug manufacturers—generally 

subject to more stringent Federal requirements. In addition, FDA must be able to 

inspect pharmacies and review records to determine the source of a complaint or 

outbreak associated with a compounded drug that may be adulterated or misbranded under the Federal Food, Drug, and Cosmetic Act (FD&C Act). FDA’s ability 

to inspect in a timely manner any firm producing drugs is critical for effective oversight and regulation. 

FDA should have clear ability to examine records such as records of prescriptions 

received, products shipped, volume of operations, and operational records such as 

batch records, product quality test results, and stability testing results. Such inspections are necessary to determine when a pharmacy exceeds the bounds of traditional 

compounding, to respond to public health threats, and to enforce Federal standards. 

Under FDA’s current inspection authority in section 704 of the FD&C Act, FDA’s 

authority to inspect records at a pharmacy depends upon knowing certain facts 

about the pharmacy’s operations that oftentimes can only be determined through inspection of records. The first of three criteria for being exempt from having records 

inspected is whether the pharmacy is operating in conformity with State law, a determination most readily made by a State and, in any case, likely dependent upon 

examining certain records. The second criterion concerns whether the pharmacy is 

dispensing prescription drugs without a prescription, but FDA must be able to inspect records to determine that fact. Similarly, the third criterion is whether the 

pharmacy is compounding drugs for sale other than in the regular course of its retail business, which is also something that would be difficult to determine without 

a full inspection of the facility, including an inspection of appropriate records. For 

each of these three criteria, FDA needs to examine records to determine whether 

the firm meets those criteria. 

59 

NATIONAL ASSOCIATION OF BOARDS OF PHARMACY, 

MOUNT PROSPECT, IL 60056, 

March 13, 2014. 

COMMITTEE ON HEALTH, EDUCATION, LABOR, AND PENSIONS, 

U.S. Senate, 

Washington, DC 20510. 

Your request for further information has been forwarded to my attention. Please 

feel free to let me know if you need additional information. 

Best wishes, 

MELISSA MADIGAN, PHARMD, JD, 

Policy and Communications Director. 

MELISSA MADIGAN, PHARMD, JD FOR CARMEN S. CATIZONE, M.S., RPH, DPH

Question. We intended, with this discussion draft, to preserve traditional pharmacy practice and compounding. However, we have received a number of comments 

indicating concern with the scope of compounding ‘‘in limited quantities’’ by traditional compounders. Can you please explain what you foresee as potential problems, 

if any, with this definition? How can the committee improve this language if it is 

a problem? 

Answer. At the time of the hearing, NABP was highly concerned with pharmacies 

compounding drug products, especially sterile drug products, in large quantities ‘‘for 

office use’’ for administration to patients in prescribers’ office or clinics. As we all 

know, many States allowed this practice ‘‘in limited quantities,’’ but compounding 

pharmacies were either inadvertently or intentionally ignoring the ‘‘limited quantity’’ rule and compounding in extraordinarily large quantities. It was the type of 

practice that led to the widespread distribution of contaminated or unsafe compounded products, culminating with the NECC tragedy, which killed over 60 

patients and injured nearly 700. Not long after the hearing, the Pharmaceutical 

Compounding Quality and Accountability Act was introduced, which addressed the 

concern by creating a new category of compounder called ‘‘compounding manufacturer’’ and prohibiting ‘‘for office use’’ compounding by pharmacies that are not 

‘‘compounding manufacturers.’’ 

ALLAN COUKELL

Question. We intended, with this discussion draft, to preserve traditional pharmacy practice and compounding. However, we have received a number of comments 

indicating concern with the scope of compounding ‘‘in limited quantities’’ by traditional compounders. Can you please explain what you foresee as potential problems, 

if any, with this definition? How can the committee improve this language if it is 

a problem? 

Answer. The threshold for allowable anticipatory compounding by traditional 

compounders (TCs) is a longstanding area of confusion. The terminology used in section 503(A), as well as this bill, permits anticipatory compounding in ‘‘limited quantities’’ based on prescribing history. FDA’s compliance guide allows ‘‘very limited 

quantities’’. These terms are undefined, and are interpreted in widely different ways 

by different stakeholders. 

The definition of a traditional compounder in this legislation includes 

compounding limited amounts in anticipation of a prescription pursuant to State 

law, which by some assessments also permits compounding without a prescription 

(aka office stock or hospital supply) where allowed by States. While some States 

may limit office-stock compounding, others may not. This would allow TCs to manufacture unlimited quantities of medicines. 

To ensure that State-licensed pharmacies operating as TCs do not become de facto 

unregulated manufacturers, clear limits on the amount of compounding permitted 

in anticipation or without a prescription should be established. To ensure clarity 

and enforceability, Congress should: (1) direct FDA to establish volume thresholds 

for compounding in anticipation of/without a prescription through regulation and (2) 

clarify that this is a uniform Federal standard not pursuant to State law. 

Alternatively, if a clear Federal standard is not established, compounding in anticipation or without a prescription should be regulated by States. However, this 

would undermine the protections established through the FDCA and put patients 

at risk from drugs made by unregulated manufacturers. 

60 

KASEY K. THOMPSON, PHARMD

Question. We intended, with this discussion draft, to preserve traditional pharmacy practice and compounding. However, we have received a number of comments 

indicating concern with the scope of compounding ‘‘in limited quantities’’ by traditional compounders. Can you please explain what you foresee as potential problems, 

if any, with this definition? How can the committee improve this language if it is 

a problem? 

Answer. Compounding in limited quantities is likely more applicable to community pharmacies that are largely retail but may also provide some compounded preparations to a local physician office or nursing facility, or even a hospital. It could 

be challenging to define ‘‘limited’’ to fit all the various practice settings in which 

compounding is conducted. 

In the hospital setting, this is more difficult as many medications administered 

in a hospital are compounded preparations, either prepared in-house or out-source. 

This may vary among hospitals with children’s hospitals engaging in a larger share 

of compounding given their patient type. It is important to note that medications 

administered to a patient are only done so pursuant to a physician order, however, 

some preparations may need to be made ahead of time, operating room medications 

for example need to be at the ready for a potential emergency situation. 

Anticipatory compounding should not be limited to such a degree that it compromises an efficient and safe compounding process or causes patients to have to 

wait for their drugs. However, ‘‘limited quantities’’ may need a more specific definition for the retail or community pharmacy setting. 

In the retail or community compounding pharmacy, anticipatory compounding 

may be based on historical compounding logs, dispensing records, or orders by physicians. Practitioners and inspectors need regulatory clarification on what historical 

prescription data will be required and how it will be used to determine quantities 

that can be compounded in advance. Otherwise, they won’t know when the line is 

crossed and enforcement may be inconsistent. For example, would doses or units 

compounded in advance be approximately equal to those dispensed in the previous 

60, 90, or 120 days? 

Hospitals, on the other hand, keep detailed records on patients and their episodes 

of care and can better predict what drugs and how many doses should be prepared 

in advance. The majority of compounding is compounded sterile preparations 

(CSPs), many of which are expensive or in scarce supply and have short beyonduse dates (BUDs). Because of these conditions, only quantities required for filling 

current orders and other doses the organization can reasonably assure will be administered before the BUD are compounded in advance. 

For the committee’s consideration the following language may serve as a starting 

point in describing ‘‘limited quantities’’: 

‘‘limited quantities shall be based upon historical demand from the previous 

year, the previous quarter and any documented increased anticipated demand. 

The Secretary shall issue draft guidance within 180 days of enactment and final 

guidance 1 year after enactment.’’ 

[Whereupon, at 12:04 p.m., the hearing was adjourned.] 

Æ