Compounding a crisis at FDA

Article Highlights

  • Observers are calling on Congress to give the FDA more power over compounding pharmacies

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  • Once a compounder starts operating as a drug manufacturer, FDA can regulate it

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  • What FDA needs is a more efficient approach to regulating firms that fall under its purview

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The tragic deaths of 55 Americans and sickening of more than 740, resulting from contaminated steroid injections that were shipped by a disreputable firm in Massachusetts, have rightly focused public attention on a largely unfamiliar, but prominent part of our drug supply chain – the practice of pharmacy compounding.

Before Congress are proposals to tighten federal regulatory oversight of these compounding pharmacies, and of the practice of pharmacy more generally. 

Observers are calling on Congress to give the FDA more oversight of these firms.

New laws merit consideration, and yesterday I participated in a hearing before the House Energy and Commerce Committee, Subcommittee on Health, as legislators consider how to shore up the oversight of the drugs produced by these pharmacies.

My testimony is available online. Applying more vigilant oversight to the compounding pharmacies starts with articulating clear and bright lines between the legitimate practice of pharmacy compounding, which should be subject solely to state and professional regulation and not FDA oversight. And then those firms operating illegally as large-scale drug manufacturers under the guise of a pharmacy license.

To these ends, I think the FDA’s message, and how the agency is framing the problem, does not adequately explain the scope of the risks and its solutions.

The compounding industry has evolved rapidly over the past decade – in some cases, as a result of FDA’s own decisions that have given greater incentives to compounding firms to get into new, and sometimes-illegal markets.

For example, in recent years FDA has sometimes ignored compounders who were making cheap, but illegal (and unapproved) copies of FDA approved products. The FDA’s political chiefs had a preference for the cheap, compounded drugs. FDA has also largely allowed compounders to plug drug shortages that were created by FDA’s abrupt changes in how the agency oversees the sterile manufacturing operations at legitimate generic drug makers.

Now, FDA’s posture is that the agency doesn’t have enough authority to adequately regulate the burgeoning compounding industry.

Whether the broader problem was in part of FDA’s own making is partly material here. It speaks to the need for FDA to apply even enforcement in the future – and not cutting illegal drug makers some slack because the end products are cheap and thus politically popular. This is going to be especially true if FDA creates a new class of regulation for the compounding firms. Uneven enforcement could give these outfits unfair advantage to obviate the intellectual property of legitimate drug makers.

But all of this doesn’t change the fact that some “compounding” pharmacies are operating as drug makers under the guise of a pharmacy license, breaking existing law, and creating public risks. They are manufacturing drugs with none of the oversight that ensures that their processes are sterile and safe. FDA’s recent inspections of some of these facilities have surfaced widespread, and potentially dangerous biological contaminations of these products. Another tragedy is just a matter of time.

But FDA’s approach to framing the problem, and its preferred solutions, is not an easy sell.

The problem with FDA’s posture is this: The agency’s pitch doesn’t match the purpose.

FDA has extensive authority to oversee the compounders that break the law. For the agency to say it “lacks authority” skirts important nuance.

Indeed, once a compounder starts operating as a drug manufacturer, FDA can regulate it. The problem is that the agency’s authority gives FDA tools that are cumbersome, hazy, and very hard to implement. And this is no small matter. The result is that FDA is getting very little public health bang for the bucks that it spends on enforcement in this area, and is able to do little more than react to problems only after they become manifest (and people are often harmed).

What FDA needs isn’t more authority, but authority that allows the agency to implement a workable regulatory regime based on legislative statute that is clear and efficient. In other words, this is a problem of lousy government regulation borne of a patchwork of fuzzy and disorganized statute.

It’s not an issue of too little authority. It’s an issue of outdated legislation that doesn’t match a modern industry and, as a result, regulations that are woefully cumbersome and inefficient.

No reasonably sized agency could ever erect an adequate regime under these rules.

This, in short, is a chance for Congress to modernize regulation by writing good law.

Moreover, FDA’s existing rules — if fully enforced — would lead to binary outcomes that make it much harder for FDA to take action. If FDA suspects a firm has problems, it probably has to shut it down completely. FDA doesn’t have the oversight tools that allow it to remediate firms.

So in other words, FDA isn’t able to easily titrate its regulatory touch in this area to the level of risk that it finds. This makes it even harder for FDA to take action, since its regulatory steps have to be more draconian.

When the FDA Commissioner went before Congress some months ago, she was poorly received precisely because her message was so weak. Arguing that FDA doesn’t have authority to adequately regulate the compounders sounds like an excuse to absolve the agency of any complicity in the tragedy in Massachusetts. That doesn’t sell well in this environment. This isn’t to say that the deaths were somehow FDA’s fault. But hindsight being 20-20, there’s certainly more the agency could have done under its existing authority to crack down on bad firms like the one in Massachusetts.

The problem isn’t that FDA lacked the authority. The problem is that FDA has such a byzantine set of rules to operate from, that the agency has little capacity to match its resources to the vast scope of the industry that legitimately falls in its scope.

What FDA needs is a more efficient approach to regulating firms that fall under its purview. That starts with a more efficient set of rules in legislation.

It also starts with FDA making an explicit admission about those local compounding pharmacies that it doesn’t regulate – the ones that belong squarely under state and professional oversight. Next, it means laying out a clear set of criteria when these firms cross the line into being drug manufacturers, and fall under the FDA’s thumb.

A recording of the hearing can be found at the Committee Website.

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