United States: Compounding Legislation Goes Through Another Change: New House Bill on Federal Oversight

Last Updated: July 20 2013
Article by Elinor H. Murárová and Rachael G. Pontikes

U.S. Rep Griffith Releases Revised Draft Bill Providing Federal Oversight over Compounding Pharmacies

While the Griffith Bill has a long way before it becomes law, it serves as a useful framework as regulators, pharmacies and other industry players continue grappling with the scope of federal oversight of compounding pharmacies.

On July 11, 2013, U.S. Representative Morgan Griffith (R-Va.) released a revised draft House Bill ("Griffith Bill"), updating the June 14, 2013, release of Senator Griffith's first proposed compounding bill, and signaling the latest push for the U.S. Food and Drug Administration's (FDA) regulation of compounding pharmacies. The Griffith Bill comes during a surge of federal oversight over compounding pharmacies, from issuing warning letters to compounding pharmacies, compounded drug recalls and other enforcement-related actions directed toward compounding pharmacies.

Unlike its Senate Bill predecessor, detailed in an earlier Duane Morris Alert, the Griffith Bill takes smaller incremental steps toward federal regulation of compounding pharmacies, which has traditionally been regulated by the states. Specifically, the Griffith Bill permits the regulation of compounding pharmacies to stay with the states; exempts compounded drugs from the Federal Food, Drug and Cosmetic Act (FDCA); and does not create a new "compounding manufacturer" regulatory category. While the Griffith Bill has a long way before it becomes law, it serves as a useful framework as regulators, pharmacies and other industry players continue grappling with the scope of federal oversight of compounding pharmacies.

Essential Elements of the Griffith Bill

Qualifications for FDCA Exemption (New Section 503A). The Griffith Bill proposes that drug products for human use should be exempted from Sections 501(a)(2)(B) (Current Good Manufacturing Practices), 502(f)(1) (adequate directions for use) and 505 (new drug application process), as long as certain conditions are met. Those conditions include:

  1. A drug product that is compounded pursuant to a patient-specific prescription order stating that a compounded product is necessary for the patient;
  2. As long as permitted by state law, a compounded drug is made before receipt of a patient-specific prescription order when the pharmacist has historically received valid prescription orders for compounded drug products and there is an established relationship between the licensed pharmacists or physician and the patient or prescriber; or
  3. As long as permitted by state law, pursuant to a non-patient-specific purchase order submitted by a healthcare provider, which assures that the drug will be administered by the healthcare practitioner within a healthcare setting and a patient-specific prescription order will be submitted within seven days.

The compounded drug must also be in compliance with the United States Pharmacopoeia chapters applicable to pharmaceutical compounding and compounded from bulk substances in compliance with applicable monographs, if any, or drugs approved by the FDA for human use.

Compounded drugs may also not be "essentially copies" of commercially available products, drug products that have been withdrawn or removed from the market for lack of safety or effectiveness or drug products for which compounding presents adverse effects on safety or effectiveness.

Volume Limitation. While the details of a volume limitation are not provided in the Griffith Bill, the current draft shows that volume limitations will be supplied at a later date.

Volume limitations were present in the Food and Drug Administration Modernization Act (FDAMA), as they were incorporated into the concept of the Memorandum of Understanding (MOU). Under FDAMA, states were required to enter into an MOU with the FDA that addressed "distribution of inordinate amounts of compounded drug products interstate," which would provide for appropriate investigations by state agencies of complaints relating to compounded drugs distributed outside the state. If a state did not enter into an MOU, a pharmacy could not ship out of state more than 5 percent of the total prescription orders it filled.

It is not yet known whether the Griffith Bill will incorporate and adopt the volume limitations related to FDAMA.

Compounding Outside the Scope of Section 503A. The Griffith Bill also contemplates a new regulatory section detailing compounding activities that fall outside the scope of the new proposed Section 503A. The Griffith Bill does not detail these activities, but shows that the final bill may include a facility inspection fee for compounding activities outside the scope of Section 503A, standards and other regulatory requirements or definitions.

Conclusion

The Griffith Bill is the latest congressional attempt to expand federal oversight over compounding pharmacies and differs in significant ways from its Senate counterpart, but it will likely still undergo many changes before it is adopted, if at all.

If you have any questions about this Alert or would like more information, please contact Elinor L. Hart, Rachael G. Pontikes, any of the attorneys in our Pharmaceutical, Medical Device, Pharmacy & Food group or the attorney in the firm with whom you are regularly in contact.

This article is for general information and does not include full legal analysis of the matters presented. It should not be construed or relied upon as legal advice or legal opinion on any specific facts or circumstances. The description of the results of any specific case or transaction contained herein does not mean or suggest that similar results can or could be obtained in any other matter. Each legal matter should be considered to be unique and subject to varying results. The invitation to contact the authors or attorneys in our firm is not a solicitation to provide professional services and should not be construed as a statement as to any availability to perform legal services in any jurisdiction in which such attorney is not permitted to practice.

Duane Morris LLP, a full-service law firm with more than 700 attorneys in 24 offices in the United States and internationally, offers innovative solutions to the legal and business challenges presented by today's evolving global markets. Duane Morris LLP, a full-service law firm with more than 700 attorneys in 24 offices in the United States and internationally, offers innovative solutions to the legal and business challenges presented by today's evolving global markets. The Duane Morris Institute provides training workshops for HR professionals, in-house counsel, benefits administrators and senior managers.

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