What is a compounding pharmacy?

A compounding pharmacy prepares customized medications for individual patients pursuant to a prescription. Rather than dispensing only commercially manufactured medications from inventory, compounding pharmacists combine, adjust, or reformulate pharmaceutical ingredients to meet a patient's specific medical needs. Compounding pharmacies are regulated by state boards of pharmacy and governed by federal law and USP quality standards.

What is pharmacy compounding?

Q: What is pharmacy compounding?

Pharmacy compounding is the practice of preparing customized medications for individual patients and animals who are not served by traditional pharmaceutical manufacturers. Licensed compounding pharmacists combine, adjust, or reformulate pharmaceutical ingredients to create essential, personalized medications prescribed for a patient's specific medical needs. Compounding is performed in pharmacies regulated by state boards of pharmacy and governed by federal law and United States Pharmacopeia (USP) quality standards.

Q: What does a compounding pharmacist do?

A compounding pharmacist prepares prescription medications from individual pharmaceutical ingredients, building medications from the ground up rather than dispensing pre-made commercial products. Working from a prescription for a named patient, the pharmacist may adjust strength, change dosage forms, remove ingredients a patient cannot tolerate, or combine medications into a single preparation to meet specific medical needs.

Q: Is compounding pharmacy regulated by the FDA?

Pharmacy compounding is regulated under both federal law and state pharmacy law. Traditional 503A compounding pharmacies prepare medications for individual patients based on valid prescriptions and are regulated and inspected by state boards of pharmacy while complying with USP quality standards. FDA-regulated 503B outsourcing facilities adhere to current good manufacturing practices and may produce compounded medications without individual patient prescriptions for hospitals and healthcare systems.

Q: Who can prescribe a compounded medication?

A physician or other licensed prescriber may prescribe a compounded medication for a named patient when commercially available medications do not meet that patient's clinical needs. The prescription specifies the required strength, dosage form, ingredients, or formulation, and a licensed compounding pharmacist prepares the medication accordingly.

In traditional compounding, pharmacists create a customized medication, most often from pure ingredients, for an individual patient pursuant to a prescription. Pharmacists’ ability to compound medications is authorized in federal law and for good reason: Manufactured drugs don’t come in strengths and dosage forms that are right for everyone, and prescribers need to be able to prescribe customized medications when, in their judgment, a manufactured drug is not the best course of therapy for a human or animal patient or the appropriate FDA-approved drug is not commercially available. Compounding is performed in pharmacies regulated by state boards of pharmacy and governed by federal law and United States Pharmacopeia (USP) quality standards.

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What does a compounding pharmacist do?

Compounding pharmacists prepare prescription medications from pure pharmaceutical ingredients, building a medication from the ground up. They work from a specific prescription written by a licensed prescriber for a named patient, adjusting strength, changing the dosage form, removing a problem ingredient, or combining medications into a single dose. Every day, compounding pharmacists play a critical, often life-or-death role in patients' lives, creating essential medications unavailable elsewhere for a range of health conditions, including autism, oncology, dermatology, ophthalmology, pediatrics, women's health, animal health, and others.

Why compounding exists

FDA-approved medications are the gold standard in our healthcare system. They are also the norm. But Congress intentionally authorized pharmacy compounding because FDA-approved drugs cannot meet every patient’s medication needs. Compounding is not a loophole or a workaround. It is a recognized part of federal law designed to fill specific gaps in patient care.

Generally, compounding is appropriate in two circumstances: when a prescriber determines that an individual patient needs a medication that differs from the commercially available product — such as a different strength, dosage form or formulation without an allergen — and when an FDA-approved medication is unavailable because of a drug shortage.

In both cases, compounding serves a need the FDA-approved product cannot meet.

Common therapeutic needs

Compounded medications cover hormone therapy, pediatric dosing, dermatology and wound care, mental-health and neurological treatments including ketamine, drug-shortage medications, and veterinary care for pets and large animals alike.

Forms and adjustments

Pharmacists can adjust strength, change the dosage form (capsule to flavored liquid, suspension, or topical cream), remove a problem ingredient like a dye or preservative, or combine multiple medications into a single preparation that simplifies the patient's routine – all based on instructions from a physician or other prescriber in the form of a patient-specific prescription.

Why do patients need compounded medications?

Commercially manufactured medications are produced in standardized strengths and dosage forms and meet the needs of most patients. But some patients have clinical needs that the available FDA-approved options do not address.

In those circumstances, a prescriber may determine that a compounded medication is appropriate. For example:

A patient may be allergic or sensitive to a dye, preservative or filler in the manufactured product. A compounding pharmacist can prepare the prescribed medication without that ingredient.
A patient may need a strength that is not commercially available. Children, older adults and patients with highly individualized dosing needs may require amounts that do not match standard manufactured strengths.
A patient may need a different dosage form. A child who cannot swallow a tablet may need a liquid. A patient with a feeding tube may need a suspension. Another patient may need a topical or other formulation suited to the prescribed route of administration.
A medication may be discontinued or unavailable because of a shortage. In those circumstances, compounding pharmacies can help maintain access to needed therapy when permitted under federal law.
A prescriber may also determine that combining multiple medications into a single compounded preparation is clinically appropriate for a particular patient.

Appropriateness and accessibility

In traditional compounding, a pharmacist creates a customized medication, most often from an active pharmaceutical ingredient, for an individual patient based on a prescription from a licensed provider. Pharmacists' ability to compound medications from pure ingredients is authorized in federal law and FDA guidance in two specific circumstances.

Appropriateness

The Food, Drug & Cosmetic Act recognizes that standardized, FDA-approved products cannot account for every patient’s clinical circumstances. That’s why it permits a prescriber to order a compounded medication when, in the prescriber’s judgment, the available manufactured options do not provide the needed strength, dosage form or combination for that individual patient. Compounding is the mechanism Congress authorized to meet those individualized needs.

Accessibility

To assure continuity of patient care during a drug shortage, providers may prescribe a compounded version of an FDA-approved drug when that drug appears on the FDA Drug Shortages list. Compounding pharmacies help patients maintain access to treatment when commercial supply fails.

At a Glance

Compounding works inside a framework that puts the patient first.

503A

Patient-Specific Compounding

Traditional pharmacies preparing customized medications for individual patients based on a valid prescription.

503B

Outsourcing Facilities

Larger-scale facilities supplying compounded drugs in bulk to hospitals and clinics, regulated directly by the FDA.

State+FDA

Layers of oversight

Compounding is governed by state boards of pharmacy, federal law, and United States Pharmacopeia compounding standards.

Flexible

Dosage Possibilities

Strength, form, ingredients, and combinations can all be adjusted to fit one patient's clinical need.

How is pharmacy compounding regulated?

Compounding in the United States is regulated under federal law and state pharmacy law. There are two main categories of compounding pharmacy, defined under the Federal Food, Drug, and Cosmetic Act.

503A PHARMACIES

503A pharmacies are traditional compounding pharmacies. They prepare medications for individual patients based on a valid prescription. They are regulated and inspected by their state board of pharmacy and must meet USP quality standards.

503B OUTSOURCING FACILITIES

503B outsourcing facilities are larger-scale compounding operations that must adhere to current good manufacturing practices, and therefore are authorized to produce and distribute medications without individual patient prescriptions. They supply hospitals, clinics, and traditional compounding pharmacies. They are regulated by the FDA directly.

Legal foundation

Compounding is authorized under Sections 503A and 503B of the Federal Food, Drug, and Cosmetic Act, which define the two categories of compounding pharmacy.

Strict standards

503A pharmacies must meet United States Pharmacopeia (USP) quality standards, while 503B facilities must comply with Current Good Manufacturing Practice (cGMP) requirements.

State & federal

503A pharmacies are regulated and regularly inspected by state boards of pharmacy. 503B outsourcing facilities answer directly to the FDA under stricter manufacturing rules.

USP mandates

USP <795> covers non-sterile preparations, <797> covers sterile preparations, and <800> governs the handling of hazardous drugs.

Therapy Areas

What types of medications are compounded?

animal

Veterinary Compounding

pediatric

Pediatric Compounding

therapy

Pain Management

Compounding glossary

Understanding pharmacy compounding starts with understanding the language used by pharmacists, prescribers, regulators, and patients. This glossary explains common compounding terms in plain language, from how customized medications are prepared to the standards and ingredients that guide the process. Use it as a quick reference while exploring compounded therapies, pharmacy regulations, and patient care.

503A

A pharmacy that prepares customized medications for individual patients based on a valid prescription, regulated by state boards of pharmacy under USP standards.

503B

A registered outsourcing facility that compounds medications in larger quantities for hospitals, clinics, and traditional pharmacies. 503B facilities are regulated directly by the FDA and must follow stricter manufacturing and quality standards.

API

Active Pharmaceutical Ingredient: The chemical compound that produces a medication's intended effect in the body. Compounding pharmacies source APIs from FDA-registered manufacturers.

Compounding

The practice of preparing customized prescription medications from individual pharmaceutical ingredients for one named patient.

Dosage forms

The physical form a medication takes, such as a capsule, liquid, cream, suspension, suppository, or injection. Compounding allows pharmacists to customize dosage forms for a patient's specific needs, as authorized by a prescriber.

Drug Shortage

A situation where a commercially manufactured medication is unavailable or difficult to obtain. Compounding pharmacies can prepare copies of FDA-approved medications to assure continuation of patient drug therapy when certain drugs appear on the FDA shortage list.

Frequently Asked Questions

Common questions about compounding

What’s the difference between a compounding pharmacy and a regular pharmacy?

A traditional pharmacy fills prescriptions using commercially manufactured medications from its existing inventory. A compounding pharmacy prepares a medication for an individual patient according to a prescriber’s specifications. Compounding may be used when that patient needs a different strength or dosage form, a formulation without an ingredient the patient cannot tolerate, or access to a medication that is not commercially available.

Is compounding pharmacy regulated by the FDA?

Who can prescribe a compounded medication?

How do I know a compounding pharmacy is legitimate?

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