Federal Register / Vol. 83, No. 175 / Monday, September 10, 2018 / Notices 45631 

information to be collected; and (d) 

ways to minimize the burden of the 

collection of information on 

respondents, including through the use 

of automated collection techniques or 

other forms of information technology. 

Consideration will be given to 

comments and suggestions submitted 

within 60 days of this publication. 

Robert A. Sargis, 

Reports Clearance Officer. 

[FR Doc. 2018–19561 Filed 9–7–18; 8:45 am] 

BILLING CODE 4184–01–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Food and Drug Administration 

[Docket No. FDA–2018–N–3065] 

Memorandum of Understanding 

Addressing Certain Distributions of 

Compounded Drug Products Between 

the States and the Food and Drug 

Administration; Revised Draft; 

Availability 

AGENCY: Food and Drug Administration, 

HHS. 

ACTION: Notice of availability; 

withdrawal. 

SUMMARY: The Food and Drug 

Administration (FDA or the Agency) is 

announcing the availability for public 

comment of a revised draft standard 

memorandum of understanding (MOU) 

entitled ‘‘Memorandum of 

Understanding Addressing Certain 

Distributions of Compounded Drug 

Products Between the State of [insert 

State] and the U.S. Food and Drug 

Administration’’ (revised draft standard 

MOU). The revised draft standard MOU 

describes the responsibilities of a State 

that chooses to sign the MOU in 

investigating and responding to 

complaints related to compounded drug 

products compounded in the State and 

distributed outside the State and in 

addressing the interstate distribution of 

inordinate amounts of compounded 

drug products. 

FDA is also announcing the 

withdrawal of an earlier draft standard 

MOU entitled ‘‘Memorandum of 

Understanding Addressing Certain 

Distributions of Compounded Human 

Drug Products Between the State of 

[insert State] and the U.S. Food and 

Drug Administration,’’ which was 

issued in February 2015 (2015 draft 

standard MOU). The 2015 draft standard 

MOU is superseded by the revised draft 

standard MOU. 

DATES: FDA is withdrawing its draft 

standard MOU that published on 

February 19, 2015 (80 FR 8874), as of 

September 10, 2018. Submit either 

electronic or written comments on the 

revised draft standard MOU by 

December 10, 2018, to ensure that the 

Agency considers your comment on this 

draft MOU before it begins work on the 

final version of the MOU. Submit either 

electronic or written comments on 

information collection issues under the 

Paperwork Reduction Act of 1995 by 

December 10, 2018 (see the ‘‘Paperwork 

Reduction Act of 1995’’ section of this 

document). 

ADDRESSES: You may submit comments 

on the MOU at any time as follows: 

Electronic Submissions 

Submit electronic comments in the 

following way: 

• Federal eRulemaking Portal: 

https://www.regulations.gov. Follow the 

instructions for submitting comments. 

Comments submitted electronically, 

including attachments, to https://

www.regulations.gov will be posted to 

the docket unchanged. Because your 

comment will be made public, you are 

solely responsible for ensuring that your 

comment does not include any 

confidential information that you or a 

third party may not wish to be posted, 

such as medical information, your or 

anyone else’s Social Security number, or 

confidential business information, such 

as a manufacturing process. Please note 

that if you include your name, contact 

information, or other information that 

identifies you in the body of your 

comments, that information will be 

posted on https://www.regulations.gov. 

• If you want to submit a comment 

with confidential information that you 

do not wish to be made available to the 

public, submit the comment as a 

written/paper submission and in the 

manner detailed (see ‘‘Written/Paper 

Submissions’’ and ‘‘Instructions’’). 

Written/Paper Submissions 

Submit written/paper submissions as 

follows: 

• Mail/Hand delivery/Courier (for 

written/paper submissions): Dockets 

Management Staff (HFA–305), Food and 

Drug Administration, 5630 Fishers 

Lane, Rm. 1061, Rockville, MD 20852. 

• For written/paper comments 

submitted to the Dockets Management 

Staff, FDA will post your comment, as 

well as any attachments, except for 

information submitted, marked and 

identified, as confidential, if submitted 

as detailed in ‘‘Instructions.’’ 

Instructions: All submissions received 

must include the Docket No. FDA– 

2018–N–3065 for ‘‘Memorandum of 

Understanding Addressing Certain 

Distributions of Compounded Drug 

Products Between the States and the 

Food and Drug Administration; Revised 

Draft; Availability.’’ Received comments 

will be placed in the docket and, except 

for those submitted as ‘‘Confidential 

Submissions,’’ publicly viewable at 

https://www.regulations.gov or at the 

Dockets Management Staff between 9 

a.m. and 4 p.m., Monday through 

Friday. 

• Confidential Submissions—To 

submit a comment with confidential 

information that you do not wish to be 

made publicly available, submit your 

comments only as a written/paper 

submission. You should submit two 

copies total. One copy will include the 

information you claim to be confidential 

with a heading or cover note that states 

‘‘THIS DOCUMENT CONTAINS 

CONFIDENTIAL INFORMATION.’’ The 

Agency will review this copy, including 

the claimed confidential information, in 

its consideration of comments. The 

second copy, which will have the 

claimed confidential information 

redacted/blacked out, will be available 

for public viewing and posted on 

https://www.regulations.gov. Submit 

both copies to the Dockets Management 

Staff. If you do not wish your name and 

contact information to be made publicly 

available, you can provide this 

information on the cover sheet and not 

in the body of your comments and you 

must identify this information as 

‘‘confidential.’’ Any information marked 

as ‘‘confidential’’ will not be disclosed 

except in accordance with 21 CFR 10.20 

and other applicable disclosure law. For 

more information about FDA’s posting 

of comments to public dockets, see 80 

FR 56469, September 18, 2015, or access 

the information at: https://www.gpo.gov/ 

fdsys/pkg/FR-2015-09-18/pdf/2015- 

23389.pdf. 

Docket: For access to the docket to 

read background documents or the 

electronic and written/paper comments 

received, go to https://

www.regulations.gov and insert the 

docket number, found in brackets in the 

heading of this document, into the 

‘‘Search’’ box and follow the prompts 

and/or go to the Dockets Management 

Staff, 5630 Fishers Lane, Rm. 1061, 

Rockville, MD 20852. 

Submit written requests for single 

copies of the draft MOU to the Division 

of Drug Information, Center for Drug 

Evaluation and Research, Food and 

Drug Administration, 10001 New 

Hampshire Ave., Hillandale Building, 

4th Floor, Silver Spring, MD 20993– 

0002. Send one self-addressed adhesive 

label to assist that office in processing 

your requests. See the SUPPLEMENTARY

INFORMATION section for electronic 

access to the draft document. 


daltland on DSKBBV9HB2PROD with NOTICES
45632 Federal Register / Vol. 83, No. 175 / Monday, September 10, 2018 / Notices 

1The conditions of section 503A of the FD&C Act 

originally included restrictions on the advertising 

or promotion of the compounding of any particular 

drug, class of drug, or type of drug and the 

solicitation of prescriptions for compounded drugs. 

These provisions were challenged in court and held 

unconstitutional by the U.S. Supreme Court in 

2002. See Thompson v. Western States Med. Ctr., 

535 U.S. 357 (2002). 

FOR FURTHER INFORMATION CONTACT: Sara 

Rothman, Center for Drug Evaluation 

and Research, Food and Drug 

Administration, 10903 New Hampshire 

Ave., Bldg. 51, Rm. 5197, Silver Spring, 

MD 20993–0002, 301–796–3110. 

SUPPLEMENTARY INFORMATION: 

I. Background 

Section 503A of the Federal Food, 

Drug, and Cosmetic Act (the FD&C Act) 

(21 U.S.C. 353a) describes the 

conditions that must be satisfied for 

drug products compounded by a 

licensed pharmacist or licensed 

physician to be exempt from the 

following sections of the FD&C Act: (1) 

Section 501(a)(2)(B) (21 U.S.C. 

351(a)(2)(B)) (concerning current good 

manufacturing practice (CGMP) 

requirements), (2) section 502(f)(1) (21 

U.S.C. 352(f)(1)) (concerning the 

labeling of drugs with adequate 

directions for use), and (3) section 505 

(21 U.S.C. 355) (concerning the approval 

of drugs under new drug applications or 

abbreviated new drug applications). 

One of the conditions to qualify for 

the exemptions listed in section 503A of 

the FD&C Act is that: (1) The drug 

product is compounded in a State that 

has entered into an MOU with FDA that 

addresses the distribution of inordinate 

amounts of compounded drug products 

interstate and provides for appropriate 

investigation by a State agency of 

complaints relating to drug products 

distributed outside such State or (2) if 

the drug product is compounded in a 

State that has not entered into such an 

MOU, the licensed pharmacist, 

pharmacy, or physician does not 

distribute, or cause to be distributed, 

compounded drug products out of the 

State in which they are compounded in 

quantities that exceed 5 percent of the 

total prescription orders dispensed or 

distributed by such pharmacy or 

physician (5 percent limit) (see section 

503A(b)(3)(B)(i) and (ii) of the FD&C 

Act). 

Section 503A(b)(3)(B) of the FD&C Act 

directs FDA to develop, in consultation 

with the National Association of Boards 

of Pharmacy (NABP), a standard MOU 

for use by the States in complying with 

section 503A(b)(3)(B)(i). 

II. Previous Efforts To Develop a 

Standard MOU 

In the Federal Register of January 21, 

1999 (64 FR 3301), FDA announced the 

availability for public comment of a 

draft standard MOU, developed in 

consultation with NABP (1999 draft 

standard MOU). Over 6,000 commenters 

submitted comments on the 1999 draft 

standard MOU. Because of litigation 

over the constitutionality of the 

advertising, promotion, and solicitation 

provision in section 503A of the FD&C 

Act,1 the draft standard MOU was not 

completed. In 2013, section 503A of the 

FD&C Act was amended by the Drug 

Quality and Security Act (DQSA) (Pub. 

L. 113–54) to remove the advertising, 

promotion, and solicitation provisions 

that were held unconstitutional, and 

FDA took steps to implement section 

503A, including the provisions on the 

MOU. In the Federal Register of 

February 19, 2015 (80 FR 8874), FDA 

withdrew the 1999 draft standard MOU 

and issued the 2015 draft standard MOU 

for public comment. FDA received more 

than 3,000 comments on the 2015 draft 

standard MOU. By this notice, FDA is 

withdrawing the 2015 draft standard 

MOU, and the revised draft standard 

MOU made available today supersedes 

the 2015 draft standard MOU. 

III. 503A Guidance 

Immediately after the enactment of 

the DQSA, in December 2013, the 

Agency published a draft guidance on 

section 503A of the FD&C Act entitled 

‘‘Pharmacy Compounding of Human 

Drug Products Under Section 503A of 

the Federal Food, Drug, and Cosmetic 

Act’’ (2013 draft 503A guidance) (see 78 

FR 72901, December 4, 2013) 

announcing the availability of the draft 

guidance). The 2013 draft 503A 

guidance described FDA’s proposed 

policy with regard to specific provisions 

of section 503A of the FD&C Act that 

require rulemaking or other action by 

FDA, such as the MOU provisions. 

Several commenters on the 2013 draft 

503A guidance offered FDA their views 

on the MOU provisions of section 503A 

of the FD&C Act. FDA considered these 

comments in developing the 2015 draft 

standard MOU and the revised draft 

standard MOU it is issuing today. The 

final 503A guidance (available at 

https://www.fda.gov/ucm/groups/ 

fdagov-public/@fdagov-drugs-gen/ 

documents/document/ucm469119.pdf), 

published July 2, 2014 (see 79 FR 37742 

announcing the availability of the final 

503A guidance), states that FDA does 

not intend to enforce the 5 percent limit 

on distribution of compounded drug 

products out of the State in which they 

are compounded until after FDA has 

finalized an MOU and made it available 

to the States for their consideration and 

signature. After considering any 

comments on the revised draft standard 

MOU submitted to this docket, FDA 

intends to finalize the MOU and make 

it available for signature by individual 

States. FDA will determine at the time 

of publication of the final MOU how 

long it will allow States to consider 

whether to sign the MOU before FDA 

begins to enforce the 5 percent limit in 

those States that have not signed an 

MOU. As discussed below, FDA is 

proposing a 180-day period. 

IV. Revised Draft Standard MOU 

FDA has now developed a revised 

draft standard MOU on which it is 

soliciting public comment. FDA has 

consulted with NABP in developing this 

revised draft standard MOU. FDA also 

considered the comments submitted on 

the 2015 draft standard MOU, as well as 

comments on the MOU provisions it 

received in connection with the 2013 

draft 503A guidance. Below, FDA has 

summarized and discussed key 

provisions of the revised draft standard 

MOU and, where appropriate, 

summarized changes that the Agency 

made in the revised draft standard 

MOU. Drug products intended for 

veterinary use, repackaged drug 

products, biological products subject to 

licensure through a biologics license 

application under section 351 of the 

Public Health Service Act (42 U.S.C. 

262), and drug products compounded 

by outsourcing facilities are not the 

subject of the revised draft standard 

MOU. 

A. Investigation of Complaints 

The revised draft standard MOU 

provides that States that enter into the 

MOU will agree to: 

• Investigate complaints relating to 

drug products compounded by a 

pharmacist in the State and distributed 

outside the State by a pharmacy, 

including complaints about adverse 

drug experiences or product quality 

issues to, among other things, take steps 

to assess whether there is a public 

health risk and whether such risk is 

adequately contained; 

• Take action, in accordance with and 

as permitted by State law, to ensure that 

the relevant compounding pharmacy 

investigates the root cause of the 

problem and addresses any public 

health risk identified in relation to the 

complaint; 

• Notify FDA as soon as possible, but 

no later than 3 business days, after 

receiving any complaints relating to a 

drug product compounded by a 

pharmacist in the State and distributed 

outside the State involving a serious 

adverse drug experience or serious 


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Federal Register / Vol. 83, No. 175 / Monday, September 10, 2018 / Notices 45633 

2FDA is currently considering whether to 

propose regulations or issue guidance documents to 

further its implementation of section 503A(b)(3)(B) 

of the FD&C Act. Notice of any such action will be 

provided in the Federal Register. 

product quality issue, and provide FDA 

with certain information about the 

complaint, including the following: 

Æ Name and contact information of 

the complainant; 

Æ Name and address of the pharmacy/ 

physician that is the subject of the 

complaint; 

Æ Description of the complaint, 

including a description of any 

compounded drug product that is the 

subject of the complaint; and 

Æ State’s initial assessment of the 

validity of the complaint relating to a 

compounded drug product distributed 

outside the State, if available; 

• Subsequent to this notification, 

provide FDA with the results 

(description and date of any State 

actions) of its investigation; 

• Notify the appropriate regulator of 

physician compounding within the 

State of any complaints about adverse 

drug experiences or product quality 

issues related to drug products 

compounded by a physician in the State 

and distributed outside the State; and 

• Maintain records of the complaints 

it receives, the investigation of each 

complaint, and any response to or 

action taken as a result of a complaint, 

beginning when the State receives 

notice of the complaint. The revised 

draft standard MOU says that the State 

agrees to maintain these records for at 

least 3 years, beginning on the date of 

final action or the date of a decision that 

the complaint requires no action. 

The types of complaints of 

compounded drug products that should 

be investigated include any adverse 

drug experience and product quality 

issues. Even non-serious adverse drug 

experiences and product quality issues 

can be indicative of problems at a 

compounding facility that could result 

in product quality defects leading to 

serious adverse drug experiences if not 

corrected. For example, inflammation 

around the site of an injection can 

indicate drug product contamination 

from inadequate sterile practices at the 

compounding pharmacy. If the 

pharmacy has inadequate sterile 

practices, other more serious 

contamination could result in serious 

adverse events. 

The revised draft standard MOU does 

not include specific directions to the 

States relating to how to conduct their 

investigation of complaints. Rather, as 

recommended by comments submitted 

to FDA previously, the details of such 

investigations are left to the States’ 

discretion. For example, a State may 

review an incoming complaint 

describing an adverse drug experience 

and determine that such a complaint 

does not warrant further investigation. 

In other cases, a State may determine 

that an incoming complaint contains 

insufficient information and investigate 

further to determine appropriate action. 

States signing the revised draft 

standard MOU would agree to notify 

FDA about certain complaints and 

provide FDA with certain information 

about the complaints so FDA could 

investigate the complaints itself, or take 

other appropriate action.2 FDA received 

comments that it was not feasible for 

States to notify FDA of certain 

complaints within a 72-hour timeframe, 

as described in the 2015 draft standard 

MOU. Comments noted that gathering 

the information requested for 

submissions within just 72 hours might 

be difficult for States, particularly given 

that this period might overlap with a 

weekend or holiday. Some comments 

requested up to 7 days to provide the 

notification, but several others 

suggested that FDA revise the 

notification period to 3 business days. 

FDA has now revised the MOU to reflect 

the latter approach. The revise draft 

standard MOU provides that 

notification will occur as soon as 

possible, but no later than 3 business 

days after the State receives the 

complaint. This period will continue to 

facilitate early Federal/State 

collaboration on serious adverse drug 

experiences and serious product quality 

issues that have the potential to affect 

patients in multiple States, while 

providing for notification in a time 

frame that is more feasible for the States. 

We note that FDA has staff on call 24 

hours a day to receive information in 

emergency situations. 

Comments also expressed concern 

that certain provisions regarding 

complaint investigation that States 

entering into the MOU would agree to 

may require States to take action not 

permitted by State law and may imply 

that, after taking action, the State has 

made a legal determination that the 

complaint has been resolved. The 

revised draft standard MOU clarifies 

that the State should investigate and 

take action that the State considers to be 

appropriate with respect to the 

complaint in accordance with and as 

permitted by State law. FDA has also 

clarified that, by signing the MOU, the 

State agrees to assess the existence of a 

public health risk associated with the 

complaint and whether such risk is 

adequately contained rather than make 

definitive determinations of risk or 

confirm containment. 

B. Inordinate Amounts 

The revised draft standard MOU 

provides that States that enter into the 

MOU will agree to: 

• On an annual basis (at minimum), 

identify, using surveys, reviews of 

compounding records during 

inspections of compounding 

pharmacies, or other mechanisms 

available to the State, compounding 

pharmacies that distribute inordinate 

amounts of compounded drug products 

interstate by collecting information 

regarding the following: 

Æ Total number of prescription orders 

for compounded drug products 

distributed or dispensed intrastate, and 

Æ Total number of prescription orders 

for compounded drug products 

distributed interstate; 

• If the State becomes aware of a 

physician who is distributing 

compounded drug products interstate, 

coordinate with the appropriate 

regulator of physician compounding 

within the State to determine, using 

surveys, reviews of records during 

inspections, or other mechanisms 

available to the State, whether the 

physician distributes inordinate 

amounts of compounded drug products 

interstate by collecting information 

regarding the following: 

Æ Total number of prescription orders 

for compounded drug products 

distributed or dispensed intrastate, and 

Æ Total number of prescription orders 

for compounded drug products 

distributed interstate; 

• For pharmacies or physicians that 

have been identified as distributing 

inordinate amounts of compounded 

drug products interstate, collect 

information regarding the following: 

Æ Total number of prescription orders 

for sterile compounded drugs 

distributed interstate; 

Æ Number of States in which the 

compounding pharmacy or physician is 

licensed or into which the 

compounding pharmacy or physician 

distributes compounded drug products; 

and 

Æ Whether the State inspected for and 

found during its most recent inspection 

that the compounding pharmacy or 

physician distributed compounded drug 

products without valid prescriptions for 

individually identified patients; 

• Notify FDA if the State identifies 

any pharmacy or physician within its 

jurisdiction that has distributed 

inordinate amounts of compounded 

drug products interstate; and 

• Provide FDA with the following 

information regarding pharmacies or 

physicians that distributed inordinate 

amounts of compounded drug products 

interstate: 


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45634 Federal Register / Vol. 83, No. 175 / Monday, September 10, 2018 / Notices 

Æ Name and address of the pharmacy/ 

physician; 

Æ Total number of prescription orders 

for compounded drug products 

distributed or dispensed intrastate; 

Æ Total number of prescription orders 

for compounded drug products 

distributed interstate; 

Æ Total number of prescription orders 

for sterile compounded drugs 

distributed interstate, 

Æ Number of States in which the 

compounding pharmacy or physician is 

licensed or into which it distributes 

compounded drug products, and 

Æ Whether the State inspected for and 

found during its most recent inspection 

that the compounding pharmacy or 

physician distributed compounded drug 

products without valid prescriptions for 

individually identified patients. 

In the revised draft standard MOU, a 

pharmacy or physician is considered to 

have distributed an inordinate amount 

of compounded drug products interstate 

if the number of prescription orders for 

compounded drug products distributed 

interstate during any calendar month is 

greater than 50 percent of the number of 

prescription orders for compounded 

drug products dispensed or distributed 

both intrastate and interstate by such 

pharmacy or physician during that 

calendar month. This concept would be 

called the 50 percent threshold. 

Section 503A of the FD&C Act reflects 

Congress’ recognition that compounding 

may be appropriate when it is based on 

receiving a valid prescription or 

notation from a prescribing practitioner 

for an identified individual patient. 

However, drug products compounded 

under section 503A are not required to 

demonstrate that they are safe or 

effective, bear adequate directions for 

use, or conform to CGMP. Congress, 

therefore, imposed strict limits on the 

distribution of drug products 

compounded under section 503A to 

protect the public health and the 

integrity of the drug approval process. 

In particular, Congress did not intend 

for compounders operating under these 

statutory provisions to grow into 

conventional manufacturing operations 

making unapproved drugs, operating a 

substantial proportion of their business 

interstate, without adequate oversight. 

Although other provisions of the FD&C 

Act apply to State-licensed pharmacies 

and physicians that may qualify for the 

exemptions under section 503A of the 

FD&C Act (e.g., the adulteration 

provisions for making drugs under 

insanitary conditions), and although 

FDA may take action in appropriate 

cases against compounders that violate 

these provisions or that operate outside 

of the conditions in section 503A, 

Congress recognized that these 

compounders are primarily overseen by 

the States. If a substantial proportion of 

a compounder’s drugs are distributed 

outside a State’s borders, adequate 

regulation of those drugs poses 

significant challenges to State 

regulators. States face logistical, 

regulatory, and financial challenges 

inspecting compounders located outside 

of their jurisdiction. In addition, if a 

compounder distributes drugs to 

multiple States, it can be very difficult 

to gather the scattered information about 

possible adverse events associated with 

those drugs, connect them to the 

compounder, and undertake 

coordinated action to address a 

potentially serious public health 

problem. 

Therefore, as a baseline measure, 

section 503A(b)(3)(B) of the FD&C Act 

limits the distribution of compounded 

drug products outside of the State in 

which they are compounded to 5 

percent of the total prescription orders 

dispensed or distributed by a licensed 

pharmacist, pharmacy or physician. It 

then directs FDA, in consultation with 

NABP, to develop a standard MOU that 

addresses the distribution of inordinate 

amounts of compounded drug products 

interstate and provides for appropriate 

investigation by a State agency of 

complaints relating to drug products 

compounded in and distributed outside 

such State. Implementation of this 

provision involves FDA describing what 

inordinate amounts means and 

providing a mechanism for addressing 

interstate distribution of inordinate 

amounts of compounded drug products, 

as long as the States agree to 

appropriately investigate complaints 

relating to drug products compounded 

in and distributed out of the State. 

In the 2015 draft standard MOU, FDA 

proposed that distribution interstate up 

to a 30 percent limit would not be 

inordinate, and that States entering into 

the MOU would agree to take action 

regarding pharmacists, pharmacies, or 

physicians that distribute inordinate 

amounts of compounded drugs 

interstate. FDA received a number of 

comments indicating that certain 

pharmacies, such as pharmacies located 

near state borders and home infusion 

pharmacies, distribute more than 30 

percent of their compounded drugs to 

patients interstate because, for example, 

the patients are located in another 

nearby State, or because few pharmacies 

compound a particular drug to treat an 

uncommon condition for patients 

dispersed throughout the country. The 

comments noted that the proposed 

definition of inordinate amounts and 

the proposed provision in which States 

agree to take action could prevent such 

pharmacies from fulfilling patients’ 

medical needs for the drugs that they 

supply. Other comments expressed 

concern about instances in which 

pharmacies are located near a State 

border and distribute compounded 

drugs to the other side of that border. 

FDA also received general comments 

questioning the Agency’s basis for the 

30 percent limit and indicating that it 

was too low. Some comments suggested 

that FDA increase the limit, including a 

suggestion to increase it to 50 percent. 

The revised draft standard MOU 

addresses these comments in two 

respects. First, it would remove the 

provision in the 2015 draft standard 

MOU that States agree to take action 

with respect to the distribution of 

inordinate amounts of compounded 

drug products interstate. Second, it 

would change what is considered 

‘‘inordinate amounts’’ from a 30 percent 

limit to a 50 percent threshold. 

With respect to State action, the 

revised draft standard MOU instead 

provides that States entering into the 

MOU would agree to inform FDA of 

compounders that have distributed an 

inordinate amount of compounded drug 

products interstate. The Agency does 

not intend to take action against a 

compounder located in a State that has 

entered into the MOU solely because the 

compounder has exceeded the threshold 

for inordinate amounts. Rather, FDA 

proposes that States collect further 

information on compounders that have 

distributed inordinate amounts 

interstate and provide this information 

to FDA to help inform inspectional 

priorities. 

States generally have day-to-day 

oversight responsibilities over Statelicensed pharmacies, pharmacists, and 

physicians. In general, FDA considers a 

pharmacy or physician that distributes 

the majority of its compounded drugs 

intrastate to be primarily overseen by 

the State, which is responsible both for 

regulation of the compounder and 

protection of its citizens who receive the 

compounded drugs. However, as 

discussed above, if a substantial 

proportion of a compounder’s drugs is 

distributed outside a State’s borders, 

adequate regulation of those drugs poses 

significant challenges to State 

regulators. In such cases, although State 

oversight continues to be critical, 

additional oversight by FDA may afford 

an important public health benefit. 

As stated above, in the revised draft 

standard MOU, FDA proposes 

eliminating the 30 percent limit and 

instead establishing 50 percent as the 

threshold beyond which the amount of 

compounded drugs distributed 


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Federal Register / Vol. 83, No. 175 / Monday, September 10, 2018 / Notices 45635 

3FDA also intends to exclude non-compounded 

drugs from the calculation of the 5 percent limit in 

section 503A(b)(3)(B)(ii). 

interstate would be considered 

inordinate. Under this proposal, the 

threshold triggers an information 

collection and reporting obligation once 

it is reached. The Agency believes that 

more than 50 percent is an appropriate 

measure of ‘‘inordinate amounts’’ 

because it marks the point at which 

pharmacies and physicians are 

distributing the majority of their 

compounded drug products interstate, 

and the regulatory challenges associated 

with interstate distributors discussed 

above become more pronounced. At this 

tipping point, the risk posed by the 

distribution practices of the 

compounder may weigh in favor of 

additional Federal oversight in addition 

to State oversight. 

FDA recognizes that in some cases, 

compounders may distribute more than 

50 percent of a small quantity of 

compounded drug products to 

contiguous States. Although such 

compounders have exceeded the 

inordinate amounts threshold proposed 

in the revised draft standard MOU, FDA 

would consider other information, such 

as the number of patients that will 

receive the compounded drugs, if 

available, when assessing the 

compounders’ priority for risk-based 

inspection. Accordingly, when a State 

identifies a pharmacy or physician that 

distributes an inordinate amount of 

compounded drug products interstate, 

the draft standard MOU provides that 

the State would supply the Agency 

with: (1) Information about the total 

number of prescription orders for 

compounded drug products that it 

distributed or dispensed intrastate; (2) 

the total number of prescription orders 

for compounded drug products that it 

distributed interstate; (3) the total 

number of prescription orders for sterile 

compounded drug products that it 

distributed interstate; (4) the number of 

States in which the compounder is 

licensed; and (5) whether the State 

inspected for and found during its most 

recent inspection that the compounding 

pharmacy or physician distributed 

compounded drug products without 

valid prescriptions for individually 

identified patients. FDA intends to use 

this information to prioritize its 

inspections of compounders based on 

risk, focusing on those that appear likely 

to distribute large volumes of 

compounded drug products, 

particularly when the distribution is to 

multiple States, the drug products are 

intended to be sterile, and there is 

information about a lack of valid 

prescriptions for individually identified 

patients. 

FDA has further revised the 

calculation of inordinate amounts as 

follows. The 2015 draft standard MOU 

provided that a compounder is 

considered to have distributed an 

inordinate amount of compounded drug 

products interstate if the number of 

units of compounded drug products 

distributed interstate during any 

calendar month is equal to or greater 

than 30 percent of the number of units 

of compounded and non-compounded 

drug products distributed or dispensed 

both intrastate and interstate by such 

compounder during that calendar 

month. FDA received comments noting 

that because the calculation includes 

both compounded and noncompounded drug products, in many 

cases, a substantial factor in whether a 

compounder has distributed an 

inordinate amount of compounded drug 

products interstate is whether the 

compounder offers non-compounded 

drug products. For example, under that 

policy, many specialty compounding 

pharmacies that engage in interstate 

distribution and only distribute 

compounded drug products would be 

able to distribute fewer compounded 

drug products interstate before reaching 

an inordinate amount than a pharmacy 

that also fills prescriptions for noncompounded drug products, even if 

both pharmacies produced the same 

amount of compounded drug products. 

After considering the public comments, 

FDA does not believe that including 

non-compounded drug products within 

the calculation of inordinate amounts 

would help address the public health 

concerns associated with sending 

compounded drug products out of State 

that Congress sought to address in 

section 503A(b)(3)(B) of the FD&C Act. 

Accordingly, for purposes of the revised 

draft standard MOU, FDA is proposing 

to exclude consideration of noncompounded drug products from the 

calculation of inordinate amounts so 

that the denominator is determined by 

solely referencing compounded drug 

products.3

C. Definitions 

Appendix A in the revised draft 

standard MOU defines key terms used 

in the MOU. FDA is retaining the 

definitions of ‘‘adverse drug 

experience,’’ ‘‘serious adverse drug 

experience,’’ ‘‘product quality issue,’’ 

and ‘‘serious product quality issue’’ 

from the 2015 draft standard MOU. 

The revised draft standard MOU also 

defines ‘‘distribution.’’ With respect to 

that definition, for purposes of the 

revised draft standard MOU, FDA 

proposes that distribution means that a 

compounder has sent a compounded 

drug product out of the facility in which 

the drug was compounded. Such 

distribution may include, but is not 

limited to, delivery or shipment to a 

physician’s office, hospital, or other 

health care setting for administration, 

and dispensing the drug product by 

sending it to a patient for the patient’s 

own use. This definition is revised from 

the 2015 draft standard MOU and is 

intended to address stakeholder 

comments and to better effectuate the 

purposes of section 503A of the FD&C 

Act. 

In the 2015 draft standard MOU, FDA 

proposed to define the term 

‘‘distribution’’ to include, among other 

things, dispensing of a compounded 

drug product to a patient for the 

patient’s own use. We received a 

number of comments on the 2015 draft 

standard MOU stating that distributing 

and dispensing are mutually exclusive 

activities, such that if a drug product is 

distributed, it is not also dispensed, and 

vice versa. Some comments asserted, in 

particular, that a compounded drug 

product should not be considered to be 

‘‘distributed’’ when it is provided 

pursuant to a prescription. Other 

stakeholders, however, agreed with the 

inclusion of drug products provided 

pursuant to a prescription within the 

definition of ‘‘distribution’’ and 

maintained that this interpretation was 

important to protect the public health. 

After considering these comments and 

the public health objectives of section 

503A(b)(3)(B) of the FD&C Act, we have 

proposed to revise the definition of 

distribution to exclude dispensing that 

occurs at the facility in which the drug 

was compounded. We intend to 

consider that when a drug is picked up 

in this way, dispensing, but not 

distribution, occurs for purposes of 

calculating ‘‘inordinate amounts’’ under 

the MOU or applying the 5 percent limit 

in section 503A(b)(3)(B)(ii) of the FD&C 

Act. 

FDA proposes that in-person 

dispensing, where the transaction 

between the compounder and the 

patient is completed without the 

compounded drug leaving the facility in 

which it was compounded, is 

appropriately overseen, primarily, by 

the State outside the context of the 

MOU, regardless of whether the 

compounded drug product subsequently 

leaves the State. Such an intrastate, 

local transaction generally indicates a 

close connection among the patient, 

compounder, and prescriber. By 

contrast, transactions by mail often have 

a less direct nexus among the patient, 

compounder, and prescriber than inVerDate Sep<11>2014 17:54 Sep 07, 2018 Jkt 244001 PO 00000 Frm 00042 Fmt 4703 Sfmt 4703 E:\FR\FM\10SEN1.SGM 10SEN1

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4 In other (non-compounding) contexts, where it 

would further a regulatory purpose, Congress and 

the Agency have specifically defined ‘‘distribute’’ to 

exclude dispensing. See, for example, section 

581(5) of the FD&C Act (21 U.S.C. 360eee(5)), which 

applies to Title II of the DQSA, and 21 CFR 208.3. 

Section 503A of the FD&C Act does not contain a 

similar definition or a similar specific direction to 

exclude dispensing from the meaning of 

distribution. We also note that these definitions 

were adopted for provisions that focus on 

conventionally manufactured drug products, which 

assign different obligations to dispensers than to 

wholesalers, packagers, or other intermediaries in 

light of the different role that dispensers play with 

respect to product labeling and the drug 

distribution chain. In contrast, section 503A of the 

FD&C Act focuses on compounded drugs, and the 

reasons for defining ‘‘distribution’’ to exclude 

dispensing in Title II of the DQSA or part 208 do 

not apply. 

person pickups and would be 

considered ‘‘distributions.’’ 

Under this revised proposed 

definition, drugs dispensed in-person 

that are later taken out of State would 

not contribute to reaching the threshold 

for inordinate amounts that would need 

to be reported to FDA under the MOU. 

Nor would complaints associated with 

compounded drug products dispensed 

this way and subsequently taken out of 

State be subject to the complaint 

investigation provisions of the MOU. 

FDA expects that, in practice, the State 

in which the initial transaction occurred 

would handle such complaints. The 

State may, in its discretion, notify FDA 

of the complaint. We recognize that 

including in-person dispensing in the 

definition of ‘‘distribution’’ would result 

in complex tracking issues in instances 

when a patient subsequently crosses 

State lines. Under the proposed revised 

definition, the compounder would not 

need to track where the patient takes the 

compounded drug product after it is in 

the patient’s possession. 

FDA is not persuaded by comments 

on the 2015 draft standard MOU urging 

the Agency to interpret ‘‘distribution’’ 

and ‘‘dispensing’’ to be entirely separate 

activities for purposes of section 

503A(b)(3)(B) of the FD&C Act. These 

comments recommend using definitions 

for these terms used elsewhere in the 

FD&C Act and FDA regulations, and 

generally conclude that distribution 

does not include the transfer of a drug 

pursuant to a prescription. 

The conditions in section 503A, 

including section 503A(b)(3)(B), must be 

interpreted consistent with the 

prescription requirement in section 

503A(a) of the FD&C Act. If we were to 

interpret the word ‘‘distribution’’ to 

apply only if a drug is provided without 

a prescription, it would mean that drug 

products compounded under section 

503A of the FD&C Act are excluded 

from regulation under the MOU and the 

5 percent limit, because to qualify for 

the exemptions under section 503A, a 

compounder must obtain a valid 

prescription order for an individually 

identified patient. For the reasons stated 

previously in section IV.B, we believe 

this would achieve the opposite of what 

Congress intended. A compounded drug 

product may be eligible for the 

exemptions under section 503A of the 

FD&C Act only if it is, among other 

things, ‘‘compounded for an identified 

individual patient based on the receipt 

of a valid prescription order or a 

notation, approved by the prescribing 

practitioner, on the prescription order 

that a compounded product is necessary 

for the identified patient.’’ 

Nor is there anything to suggest that 

Congress understood distributed and 

dispensed to be mutually exclusive 

categories rather than overlapping 

categories for purposes of section 503A 

of the FD&C Act. Section 503A(b)(3)(B) 

of the FD&C Act does not define 

‘‘distribution’’ to exclude dispensing, 

which Congress has done elsewhere 

when that was its intention.4 The 

definition proposed by comments 

would write an exclusion for 

dispensing, in its entirety, into the 

statute where Congress did not. Indeed, 

with respect to comments suggesting 

that drugs dispensed pursuant to 

prescriptions could not also be 

‘‘distributed,’’ we note that, in section 

503A(b)(3)(B) of the FD&C Act, Congress 

specifically contemplated that 

prescription orders could be 

‘‘distributed’’ when it directed the 

Agency to count the number of 

prescription orders that pharmacists and 

prescribers distributed. 

V. Other Issues 

A. Development of a Standard MOU 

A number of comments on the 1999 

draft standard MOU, the 2013 draft 

503A guidance, and the 2015 draft 

standard MOU suggested that FDA 

negotiate MOUs with individual States, 

rather than develop a standard MOU. 

Section 503A of the FD&C Act requires 

the Agency to develop a standard MOU 

for use by the States. Furthermore, it 

would be impractical to develop an 

individualized MOU with every State, 

and creating individualized MOUs 

would create a patchwork of regulation 

of interstate distribution by 

compounders seeking to qualify for the 

exemptions under section 503A of the 

FD&C Act. This would be confusing to 

the health care community, as well as 

regulators. 

B. Exemptions From the Interstate 

Distribution Provisions 

Some comments on the 2013 draft 

503A guidance and the 2015 draft 

standard MOU requested that we 

consider exempting certain drug 

products or types of compounding 

entities from the threshold in the MOU 

and the 5 percent limit. For example, 

some comments recommended that we 

exempt nonsterile products. 

American consumers rely on the FDA 

drug approval process to ensure that 

medications have been evaluated for 

safety and effectiveness before they are 

marketed in the United States. Drugs 

made by compounders, including those 

made at outsourcing facilities, are not 

FDA-approved. This means that they 

have not undergone premarket review of 

safety, effectiveness, or manufacturing 

quality. Therefore, when an FDAapproved drug is commercially 

available, FDA recommends that 

practitioners prescribe the FDAapproved drug rather than a 

compounded drug unless the 

prescribing practitioner has determined 

that a compounded product is necessary 

for the particular patient and would 

provide a significant difference for the 

patient as compared to the FDAapproved commercially available drug 

product. 

In section 503A of the FD&C Act, 

Congress enacted several conditions to 

differentiate compounders from 

conventional manufacturers and 

provided that only if the compounders 

meet those conditions can they qualify 

for the exemptions from the drug 

approval requirements in section 505 of 

the FD&C Act. One of those conditions 

relates to limitations on the interstate 

distribution of compounded drug 

products, and FDA intends to enforce 

those provisions to differentiate 

compounding that qualifies for the 

exemptions from conventional 

manufacturing in the guise of 

compounding that does not, and will 

apply the conditions to all types of 

drugs and all categories of 

compounding. 

C. Information Sharing Between States 

and FDA 

The revised draft standard MOU 

provides that States will agree to notify 

FDA of any complaint relating to a 

compounded drug product distributed 

outside the State involving a serious 

adverse drug experience or serious 

product quality issue, and provide 

information about those events and 

issues. The revised draft standard MOU 

also provides that States will notify FDA 

if they identify a pharmacy or physician 


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5 ‘‘[U]ntil the State . . . enters into a 

memorandum of understanding (MOU) with the 

Secretary or 180 days after the development of the 

standard MOU, whichever comes first, the [section 

503A] exemption shall not apply if inordinate 

quantities of compounded products are distributed 

outside of the State in which the compounding 

pharmacy or physician is located.’’ (U.S. Senate 

Committee Report) 

within their jurisdiction that has 

distributed inordinate amounts of 

compounded drug products interstate. 

FDA regularly posts on its 

compounding website information 

about enforcement and other actions 

related to compounders that violate the 

FD&C Act, and it is obligated to share 

certain information with States under 

section 105 of the DQSA. In addition to 

these measures, FDA is taking steps to 

proactively share information with 

States about complaints that it receives, 

consistent with Federal laws governing 

information disclosure. 

D. Enforcement of the 5 Percent Limit on 

Distribution of Compounded Drug 

Products Out of the State in Which They 

Are Compounded 

In the 503A guidance, FDA stated that 

it does not intend to enforce the 5 

percent limit on distribution of 

compounded drug products outside of 

the State in which they are compounded 

until 90 days after FDA has finalized a 

standard MOU and made it available to 

the States for their consideration and 

signature. Most comments on the 2013 

draft 503A guidance said this period 

was too short, but did not recommend 

a specific alternative. A few comments 

recommended a different timeframe, 

one recommending 120 days and 

another recommending 365 days. The 

1997 Senate Committee Report for the 

Food and Drug Administration 

Modernization Act suggests that a 180- 

day period for States to decide whether 

to sign might be appropriate.5

Consistent with the 2015 draft standard 

MOU, the Agency proposes a 180-day 

period after the final standard MOU is 

made available for signature before FDA 

will enforce the 5 percent limit in States 

that have not signed the MOU, and 

invites public comment on whether this 

is an appropriate timeframe. FDA will 

announce at the time it publishes the 

final standard MOU and makes it 

available for signature when it intends 

to begin enforcing the 5 percent limit in 

States that do not sign. 

E. Physician Compounding 

Several comments advised that State 

boards of pharmacy do not oversee 

physician compounding and would not 

be able to agree to perform the 

obligations under the 2015 draft 

standard MOU with respect to oversight 

of physician compounding. 

FDA recognizes that physicians often 

do not indicate, as part of their State 

licensure, that they compound drug 

products, and that there may not be 

routine mechanisms, such as 

inspections, to determine the extent to 

which such physicians distribute 

compounded drugs interstate. It is also 

FDA’s understanding that physicians 

who compound drugs generally do so 

for their own patients, within their own 

professional practice, and they 

distribute or dispense them intrastate. 

However, there is still the potential for 

widespread harm if physicians ship 

large percentages of compounded drugs 

interstate without State investigation of 

complaints associated with those 

compounded drugs. Accordingly, under 

the revised draft standard MOU, States 

would agree to: (1) Notify FDA and the 

appropriate State agency if they receive 

information about serious adverse drug 

experiences or serious product quality 

issues associated with drugs 

compounded by physicians and (2) if 

they become aware of a physician 

distributing compounded drugs 

interstate, coordinate with the regulator 

of physician compounding within the 

State to determine whether the 

physician distributes inordinate 

amounts of compounded drug products 

interstate and notify FDA of physicians 

that do so. 

F. Prescription Orders 

Commenters expressed that the 

meaning of the term ‘‘units,’’ which is 

used in the 2015 draft standard MOU to 

calculate the 30 percent limit, was 

unclear to them. 

In the revised draft standard MOU, 

FDA has replaced the term ‘‘unit’’ with 

‘‘prescription order’’ (i.e., the inordinate 

amounts calculation uses numbers of 

prescription orders for compounded 

drug products). ‘‘Prescription orders’’ 

includes chart orders for patients made 

in a healthcare setting. For purposes of 

this MOU, each refill is considered to be 

a new prescription order. 

VI. Paperwork Reduction Act of 1995 

Under the Paperwork Reduction Act 

of 1995 (the PRA) (44 U.S.C. 3501– 

3520), Federal Agencies must obtain 

approval from the Office of Management 

and Budget (OMB) for each collection of 

information they conduct or sponsor. 

‘‘Collection of information’’ is defined 

in 44 U.S.C. 3502(3) and 5 CFR 

1320.3(c) and includes Agency requests 

or requirements that members of the 

public submit reports, keep records, or 

provide information to a third party. 

Section 3506(c)(2)(A) of the PRA (44 

U.S.C. 3506(c)(2)(A)), requires Federal 

Agencies to provide a 60-day notice in 

the Federal Register for each proposed 

collection of information before 

submitting the collection to OMB for 

approval. To comply with this 

requirement, FDA is publishing notice 

of the proposed collection of 

information set forth in this document. 

With respect to the following 

collection of information, FDA invites 

comments on these topics: (1) Whether 

the proposed collection of information 

is necessary for the proper performance 

of FDA’s functions, including whether 

the information will have practical 

utility; (2) the accuracy of FDA’s 

estimate of the burden of the proposed 

collection of information, including the 

validity of the methodology and 

assumptions used; (3) ways to enhance 

the quality, utility, and clarity of the 

information collected; and (4) ways to 

minimize the burden of the collection of 

information on respondents, including 

through the use of automated collection 

techniques, when appropriate, and other 

forms of information technology. 

Section 503A of the FD&C Act 

describes, among other things, the 

circumstances under which certain drug 

products compounded by a licensed 

pharmacist or licensed physician are 

exempt from certain sections of the 

FD&C Act. One of the conditions to 

qualify for the exemptions listed in 

section 503A of the FD&C Act is that: (1) 

The drug product is compounded in a 

State that has entered into an MOU with 

FDA that addresses the distribution of 

inordinate amounts of compounded 

drug products interstate and provides 

for appropriate investigation by a State 

agency of complaints relating to 

compounded drug products distributed 

outside such a State or (2) if the drug 

product is compounded in a State that 

has not entered into such an MOU, the 

licensed pharmacist, pharmacy, or 

physician does not distribute, or cause 

to be distributed, compounded drug 

products out of the State in which they 

are compounded, more than 5 percent of 

the total prescription orders dispensed 

or distributed by such pharmacy or 

physician (see section 503A(b)(3)(B)(i) 

and (ii). 

Section 503A(b)(3) directs FDA, in 

consultation with the NABP, to develop 

a standard MOU for use by States in 

complying with the provisions 

concerning the interstate distribution of 

inordinate amounts of compounded 

drug products interstate and appropriate 

investigation by a State agency of 

complaints relating to drug products 

compounded in the State and 

distributed outside such State. 


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The revised draft standard MOU 

contains the information collections that 

must be approved by OMB under the 

PRA. These information collections are 

described in this section of the 

document. For purposes of this analysis, 

FDA assumes that 45 States will sign the 

standard MOU with FDA. 

Under section III.a. of the revised 

draft standard MOU, the State will 

notify FDA by email at StateMOU@

fda.hhs.gov as soon as possible, but no 

later than 3 business days, after 

receiving any complaint relating to a 

compounded drug product distributed 

outside the State involving a serious 

adverse drug experience or serious 

product quality issue. The notification 

will include the following information: 

(1) The name and contact information of 

the complainant; (2) the name and 

address of the pharmacy or physician 

that is the subject of the complaint; (3) 

a description of the complaint, 

including a description of any 

compounded drug product that is the 

subject of the complaint; and (4) the 

State’s initial assessment of the validity 

of the complaint relating to a 

compounded drug product distributed 

outside the State, if available. In 

addition, the States will maintain 

records of the complaints they receive, 

the investigation of each complaint, and 

any response to or action taken as a 

result of a complaint, beginning when 

the State receives notice of the 

complaint. The States will maintain 

these records for at least 3 years, 

beginning on the date of final action or 

the date of a decision that the complaint 

requires no action. 

Based on our knowledge of State 

regulation of compounding practices 

and related complaints, we estimate that 

annually a total of approximately 45 

States (‘‘no. of respondents’’ in table 1, 

row 2) will notify FDA within 3 

business days of receiving any 

complaint relating to a compounded 

drug product distributed outside the 

State involving a serious adverse drug 

experience or serious product quality 

issue. We estimate that each State will 

notify FDA annually of approximately 3 

complaints it receives (‘‘no. of responses 

per respondent’’ in table 1, row 2), for 

a total of 135 notifications of complaints 

sent to FDA (‘‘total annual responses’’ in 

table 1, row 2). We estimate that 

preparing and submitting this 

information to us as described in the 

MOU will take approximately 0.5 hours 

per response (‘‘average burden per 

response’’ in table 1, row 1), for a total 

of 67.5 hours (‘‘total hours’’ in table 1, 

row 2). 

We also estimate that a total of 

approximately 45 States (‘‘no. of 

recordkeepers’’ in table 2) will prepare 

and maintain records for 3 years of the 

complaints they receive, investigations 

of complaints, and any State action 

taken or response to complaints. We 

estimate that each State will receive 

approximately 3 complaints annually 

and will prepare and maintain 

approximately 5 records per each 

complaint the State receives, for a total 

of 15 records per State (‘‘no. of records 

per recordkeeper’’ in table 2), and a total 

of 675 records annually across all States 

(‘‘total annual records’’ in table 2). We 

further estimate that preparing and 

maintaining these records will take 

approximately 1 hour per record 

(‘‘average burden per recordkeeping (in 

hours)’’ in table 2), for a total of 675 

hours (‘‘total hours’’ in table 2). 

Under section III.b of the revised draft 

standard MOU, on an annual basis (at 

minimum), the State will identify, using 

surveys, reviews of records during 

inspections, or other mechanisms 

available to the State, compounding 

pharmacies that distribute inordinate 

amounts of compounded drug products 

interstate by collecting information 

regarding the total number of 

prescription orders for compounded 

drug products distributed or dispensed 

intrastate and the total number of 

prescription orders for compounded 

drug products distributed interstate. 

Similarly, the State will engage in the 

same efforts to collect this information 

if it becomes aware of a physician who 

is distributing compounded drug 

products interstate. If a pharmacy or 

physician has been identified as 

distributing inordinate amounts of 

compounded drug products interstate, 

the State will also collect information 

regarding: (1) The total number of 

prescription orders for sterile 

compounded drug products distributed 

out of State; (2) the number of States in 

which the compounding pharmacy or 

physician is licensed or number of 

States into which the compounding 

pharmacy or physician distributes 

compounded drug products; and (3) 

whether the State inspected for and 

found during its most recent inspection 

that the compounding pharmacy or 

physician distributed compounded drug 

products without valid prescriptions for 

individually identified patients. 

The States will notify FDA by email 

at StateMOU@fda.hhs.gov within 30 

days of identifying a pharmacy/ 

physician within their jurisdiction that 

has distributed inordinate amounts of 

compounded drug products interstate, 

as described in the revised draft 

standard MOU. The notification should 

include the name and address of the 

pharmacy/physician and the 

information that the States collected, 

described in the previous paragraph. 

We estimate that annually a total of 

approximately 45 States (‘‘no. of 

respondents’’ in table 1, row 3) will 

identify compounding pharmacies or 

physicians that distribute inordinate 

amounts of compounded drug products 

interstate. We estimate that each State 

will perform surveys or inspections of 

150 pharmacies or physicians to 

identify this information (‘‘no. of 

responses per respondent’’ in table 1, 

row 3). We estimate that this will take 

approximately 1 hour per response 

(‘‘average burden per response’’ in table 

1, row 3), for a total of 6,750 hours 

(‘‘total hours’’ in table 1, row 3). We 

estimate that annually a total of 40 

States (‘‘no. of respondents’’ in table 1, 

row 4) will notify FDA of their finding 

that a pharmacy or physician has 

distributed inordinate amounts of 

compounded drug products interstate. 

We estimate that each State will notify 

FDA annually of approximately 50 

findings it makes (‘‘no. of responses per 

respondent’’ in table 1, row 4), for a 

total of 200 notifications (‘‘total annual 

responses’’ in table 1, row 4). We 

estimate that preparing and submitting 

this information to FDA as described in 

the MOU will take approximately 0.5 

hours per response (‘‘average burden per 

response’’ in table 1, row 4), for a total 

of 100 hours (‘‘total hours’’ in table 1, 

row 4). 

Under section V of the revised draft 

standard MOU, a State may designate a 

new liaison to the MOU by notifying 

FDA’s administrative liaison in writing. 

If a State’s liaison becomes unavailable 

to fulfill its functions under the MOU, 

the State will name a new liaison within 

2 weeks and notify FDA. 

We estimate that annually a total of 

approximately 13 States (‘‘no. of 

respondents’’ in table 1, row 5) will 

notify FDA of a new liaison to the MOU. 

We estimate that each State will submit 

to FDA annually approximately 1 

notification of a new liaison (‘‘no. of 

responses per respondent’’ in table 1, 

row 5), for a total of 13 notifications of 

a new liaison (‘‘total annual responses’’ 

in table 1, row 5). We estimate that 

preparing and submitting each 

notification as described in the MOU 

will take approximately 0.2 hours per 

response (‘‘average burden per 

response’’ in table 1, row 5), for a total 

of 2.6 hours (‘‘total hours’’ in table 1, 

row 5). 

Under section VI of the revised draft 

standard MOU, a State may terminate its 

participation in the MOU by submitting 

to FDA a 30-day notice of termination. 

We estimate that annually a total of 

approximately 1 State (‘‘no. of 


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Federal Register / Vol. 83, No. 175 / Monday, September 10, 2018 / Notices 45639 

respondents’’ in table 1, row 6) will 

notify FDA that it intends to terminate 

its participation in the MOU. We 

estimate that this State will submit to 

FDA annually approximately 1 

notification of termination (‘‘no. of 

responses per respondent’’ in table 1, 

row 6), for a total of 1 notification 

(‘‘total annual responses’’ in table 1, row 

6). We estimate that preparing and 

submitting the notification as described 

in the MOU will take approximately 0.2 

hours per notification (‘‘average burden 

per response’’ in table 1, row 6), for a 

total of 0.2 hours (‘‘total hours’’ in table 

1, row 6). 

Under section VI of the revised draft 

standard MOU, if a State does not 

adhere to the provisions of the MOU, 

FDA may post a 30-day notice of 

termination on its website. As a result 

of this action by FDA, the State will 

notify all licensed pharmacists, 

pharmacies and physicians within the 

State of the termination and advise them 

that compounded drug products may be 

distributed (or caused to be distributed) 

out of the State only in quantities that 

do not exceed 5 percent of the total 

prescription orders dispensed or 

distributed by such pharmacy or 

physician. 

We estimate that annually a total of 

approximately 1 State (‘‘no. of 

respondents’’ in table 3) will submit to 

the pharmacists, pharmacies, and 

physicians in its State 1 notification of 

termination as described in the MOU 

(‘‘no. of disclosures per respondent’’ in 

table 3), for a total of 1 notification of 

termination (‘‘total annual disclosures’’ 

in table 3). We estimate that preparing 

and submitting each notification will 

take approximately 1 hour per 

notification (‘‘average burden per 

disclosure (in hours)’’ in table 3), for a 

total of 1 hour (‘‘total hours’’ in table 3). 

FDA estimates the burden of this 

collection of information as follows: 

TABLE 1—ESTIMATED ANNUAL REPORTING BURDEN 1

Compounding MOU between 

FDA and States 

Number of 

respondents 

Number of 

responses per 

respondent 

Total annual 

responses Average burden per response Total hours 

State notifies FDA of compounding complaints it receives.45 3 135 0.5 (30 minutes) ..................... 67.5 

State identifies pharmacies or physicians 

that distribute inordinate amounts of 

compounded drugs interstate using surveys or inspections.

45 150 6,750 1 ............................................. 6,750 

State notifies FDA of the distribution of inordinate amounts of compounded drug 

products.

40 50 200 0.5 (30 minutes) ..................... 100 

State notifies FDA of a new liaison to the 

MOU.

13 1 13 0.2 (12 minutes) ..................... 2.6 

State notifies FDA of its intent to terminate 

participation in the MOU.

1 1 1 0.2 (12 minutes) ..................... 0.2 

Total ..................................................... ........................ ........................ ........................ ................................................ 6,920.3 

1 There are no capital costs or operating and maintenance costs associated with this collection of information. 

TABLE 2—ESTIMATED ANNUAL RECORDKEEPING BURDEN 1

Compounding MOU between FDA and States Number of 

recordkeepers 

Number of 

Records per 

recordkeeper 

Total annual 

records 

Average 

burden per 

recordkeeping 

(in hours) 

Total hours 

State recordkeeping for 3 years of compounding complaints ............................................................................... 45 15 675 1 675 

Total .............................................................................. ........................ ........................ ........................ ........................ 675 

1 There are no capital costs or operating and maintenance costs associated with this collection of information. 

TABLE 3—ESTIMATED ANNUAL THIRD-PARTY DISCLOSURE BURDEN 1

Compounding MOU between FDA and States Number of 

respondents 

Number of disclosures per 

respondent 

Total annual 

disclosures 

Average 

burden per 

disclosure 

(in hours) 

Total hours 

State notification to pharmacists, pharmacies, and physicians that its participation in the MOU has been terminated by FDA ................................................................... 1 1 1 1 1 

Total .............................................................................. ........................ ........................ ........................ ........................ 1 

1 There are no capital costs or operating and maintenance costs associated with this collection of information. 


daltland on DSKBBV9HB2PROD with NOTICES
45640 Federal Register / Vol. 83, No. 175 / Monday, September 10, 2018 / Notices 

III. Electronic Access 

Persons with access to the internet 

may obtain the draft MOU at either 

http://www.fda.gov/Drugs/Guidance

ComplianceRegulatoryInformation/ 

Guidances/default.htm or https://

www.regulations.gov. 

Dated: August 31, 2018. 

Leslie Kux, 

Associate Commissioner for Policy. 

[FR Doc. 2018–19461 Filed 9–7–18; 8:45 am] 

BILLING CODE 4164–01–P 

DEPARTMENT OF HEALTH AND 

HUMAN SERVICES 

Food and Drug Administration 

[Docket No. FDA–2018–N–3272] 

Identifying the Root Causes of Drug 

Shortages and Finding Enduring 

Solutions; Public Meeting; Request for 

Comments 

AGENCY: Food and Drug Administration, 

HHS. 

ACTION: Notice of public meeting; 

request for comments. 

SUMMARY: The Food and Drug 

Administration (FDA, the Agency, or 

we) is announcing a public meeting 

entitled ‘‘Identifying the Root Causes of 

Drug Shortages and Finding Enduring 

Solutions.’’ The purpose of the meeting 

is to give stakeholders, including health 

care providers, patients, manufacturers, 

wholesalers, pharmacists, pharmacy 

benefit managers, veterinarians, public 

and private insurers, academic 

researchers, and the public, the 

opportunity to provide input on the 

underlying systemic causes of drug 

shortages, and make recommendations 

for actions to prevent or mitigate drug 

shortages. Members of Congress have 

asked the Agency to examine the root 

causes and drivers of these shortages, 

and to recommend measures that will 

provide more enduring solutions. To 

this end, the Commissioner has 

convened an inter-Agency task force of 

senior Federal officials of FDA, the 

Centers for Medicare & Medicaid 

Services, the Department of Veterans 

Affairs, and the Department of Defense. 

After receiving input from stakeholders, 

the task force intends to provide a report 

to Congress regarding the root causes of 

drug shortages. The report will also 

include recommendations regarding 

new authorities FDA or other Federal 

agencies could use to help provide 

enduring solutions to shortages. 

DATES: The public meeting will be held 

on November 27, 2018, from 8:30 a.m. 

to 4:30 p.m. Submit either electronic or 

written comments on this public 

meeting by January 11, 2019. See the 

SUPPLEMENTARY INFORMATION section for 

registration date and information. 

ADDRESSES: The public meeting will be 

held at the Washington Marriott at 

Metro Center, 775 12th St. NW, 

Washington, DC 20005. The hotel’s 

phone number is 202–737–2200. 

You may submit comments as 

follows. Please note that late, untimely 

filed comments will not be considered. 

Electronic comments must be submitted 

on or before January 11, 2019. The 

https://www.regulations.gov electronic 

filing system will accept comments 

until midnight Eastern Time at the end 

of January 11, 2019. Comments received 

by mail/hand delivery/courier (for 

written/paper submissions) will be 

considered timely if they are 

postmarked or the delivery service 

acceptance receipt is on or before that 

date. 

Electronic Submissions 

Submit electronic comments in the 

following way: 

• Federal eRulemaking Portal: 

https://www.regulations.gov. Follow the 

instructions for submitting comments. 

Comments submitted electronically, 

including attachments, to https://

www.regulations.gov will be posted to 

the docket unchanged. Because your 

comment will be made public, you are 

solely responsible for ensuring that your 

comment does not include any 

confidential information that you or a 

third party may not wish to be posted, 

such as medical information, your or 

anyone else’s Social Security number, or 

confidential business information, such 

as a manufacturing process. Please note 

that if you include your name, contact 

information, or other information that 

identifies you in the body of your 

comments, that information will be 

posted on https://www.regulations.gov. 

• If you want to submit a comment 

with confidential information that you 

do not wish to be made available to the 

public, submit the comment as a 

written/paper submission and in the 

manner detailed (see ‘‘Written/Paper 

Submissions’’ and ‘‘Instructions’’). 

Written/Paper Submissions 

Submit written/paper submissions as 

follows: 

• Mail/Hand delivery/Courier (for 

written/paper submissions): Dockets 

Management Staff (HFA–305), Food and 

Drug Administration, 5630 Fishers 

Lane, Rm. 1061, Rockville, MD 20852. 

• For written/paper comments 

submitted to the Dockets Management 

Staff, FDA will post your comment, as 

well as any attachments, except for 

information submitted, marked and 

identified, as confidential, if submitted 

as detailed in ‘‘Instructions.’’ 

Instructions: All submissions received 

must include the Docket No. FDA– 

2018–N–3272 for ‘‘Identifying the Root 

Causes of Drug Shortages and Finding 

Enduring Solutions.’’ Received 

comments, those filed in a timely 

manner (see ADDRESSES), will be placed 

in the docket and, except for those 

submitted as ‘‘Confidential 

Submissions,’’ publicly viewable at 

https://www.regulations.gov or at the 

Dockets Management Staff between 9 

a.m. and 4 p.m., Monday through 

Friday. 

• Confidential Submissions—To 

submit a comment with confidential 

information that you do not wish to be 

made publicly available, submit your 

comments only as a written/paper 

submission. You should submit two 

copies total. One copy will include the 

information you claim to be confidential 

with a heading or cover note that states 

‘‘THIS DOCUMENT CONTAINS 

CONFIDENTIAL INFORMATION.’’ The 

Agency will review this copy, including 

the claimed confidential information, in 

its consideration of comments. The 

second copy, which will have the 

claimed confidential information 

redacted/blacked out, will be available 

for public viewing and posted on 

https://www.regulations.gov. Submit 

both copies to the Dockets Management 

Staff. If you do not wish your name and 

contact information to be made publicly 

available, you can provide this 

information on the cover sheet and not 

in the body of your comments and you 

must identify this information as 

‘‘confidential.’’ Any information marked 

as ‘‘confidential’’ will not be disclosed 

except in accordance with 21 CFR 10.20 

and other applicable disclosure law. For 

more information about FDA’s posting 

of comments to public dockets, see 80 

FR 56469, September 18, 2015, or access 

the information at: https://www.gpo.gov/ 

fdsys/pkg/FR-2015-09-18/pdf/2015- 

23389.pdf. 

Docket: For access to the docket to 

read background documents or the 

electronic and written/paper comments 

received, go to https://

www.regulations.gov and insert the 

docket number, found in brackets in the 

heading of this document, into the 

‘‘Search’’ box and follow the prompts 

and/or go to the Dockets Management 

Staff, 5630 Fishers Lane, Rm. 1061, 

Rockville, MD 20852. 

FOR FURTHER INFORMATION CONTACT: 

Michie Hunt, Center for Drug Evaluation 

and Research, Food and Drug 

Administration, 10903 New Hampshire 


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