What has changed in the last year to year and a half in the compounding industry?

We see major change in the enforcement of quality expectations by the FDA, and growing confidence by hospitals in the outsource compounding industry. With the passing of the Drug Quality and Security Act (“DQSA”) in 2013, and subsequent release of FDA guidance documents on expectations of current Good Manufacturing Practices (“cGMP”), the FDA has been educating both outsource compounding manufacturers, and the hospitals, on what the minimum standards are that the compounding industry will operate under. In the past 18 months, we have seen the FDA increasingly hold outsource manufacturers accountable to those cGMP standards to ensure the health of patients who are prescribed medications in a hospital setting.

Overall, this has improved the quality of output the industry as a whole produces. We also see hospitals gaining confidence in outsource manufacturers largely as a result of the FDA’s diligence in enforcement. Health systems that undertake 503B activities are also becoming increasingly cognizant of their requirement to demonstrate cGMP compliance. This is prompting some to consider outsourcing as a risk mitigation strategy. From a patient perspective, this approach will lead to better outcomes and improved care.

Is compounding used to create specific medicines for an individual patient or to meet health facilities' needs for a volume of units for general patient use?

Hospital pharmacies and certain licensed compounding pharmacies compound patient-specific preparations by individual prescriptions. This is done in instances where a patient may be allergic or intolerant of an ingredient, such as dyes, preservatives or sugars, commonly found in the commercially manufactured form of a medication. Different dosage forms can also be done in this application. For example, if an elderly person or child can’t swallow a pill, the medicine can be compounded into a liquid form or topical gel that can be absorbed into the bloodstream through the skin for a better patient experience.

Because we operate 503B facilities, our focus at QuVa is non-patient specific, meaning we compound medications that hospitals and healthcare facilities can anticipate being used across a broad spectrum of their patient population. Our ability to do this is increasingly important for two key reasons –a greater commitment by healthcare facilities to provide patients with optimum treatment by having the hospital pharmacist more involved in patient care, and drug shortages.

Many patients are surprised to hear that hospitals face drug shortages - please explain why and how this happens.

Drug shortages arise for a variety of factors including manufacturing issues with the pharmaceutical company, discontinuation of an older drug from a company’s portfolio, as well as difficulties in obtaining appropriate starting material. Thankfully, drug shortages, while still common, are decreasing.

How can compound outsourcing help in patient care?

The role of the pharmacist in the hospital setting has certainly been elevated to being integrally involved in clinical outcomes. The recognition of the value of the pharmacist as an informed advisor on patient treatment regimens has increased demand for them to be more active at a patient level. Outsourced compounding activities assist the pharmacist by freeing up time that may otherwise be spent producing in the hospital pharmacy products that can readily be anticipated and purchased externally.

What advantages do hospitals realize by relying on external facilities for certain medications?

There are three key benefits – improved quality control, better patient care, and operational efficiencies. Healthcare providers take advantage of ready-to-use medicines, produced and fully tested in a controlled environment, to reduce the risk of inadvertent errors that may occur preparing the medications at the bed side. Outsource compounding is also a vital means by which healthcare providers are reducing costs by eliminating waste, and gaining valuable efficiencies that allow pharmacists to be more actively involved in individual patient care than in medicine preparation. Increasing regulation of pharmacy practice also imposes a capital cost on healthcare providers that can be alleviated by using outsourced compounders who have the resources to invest in specialty facilities and operations.

Describe sterile manufacturing to the common patient.

Outsource manufacturers create sterile medications, typically presented in I.V. bags or pre-filled syringes, that are directly administered to patients. Sterile manufacturing describes the preparation of those medications in an environment and with processes designed to prevent contamination so as to maximize patient safety. To prevent contamination, the manufacturer has stringent controls over the facility, materials, and processes used in the production so as not to introduce any contamination into the product. Importantly, to be a “sterile manufacturer” all facets of the manufacturing process must complement each other. The facility design is critical to creating an environment that allows the operator to function with the necessary level of control.

What types of drugs are most likely to be outsourced?

There are a variety of medicines that can be outsourced to facilities for supply to the hospital market. The common categories are Labor and Delivery, Anesthesiology and Pain Management. Some of the most requested medications are Morphine and Fentanyl, Oxytocin, Epinephrine, Ephedrine, and Neostigmine.

How do outsourcing facilities ensure a timely supply of products?

The necessity to test products fully before release certainly complicates having products ready on a timely basis as that testing process can take on average 14 – 18 days. However, this is overcome by coordinating anticipated needs with healthcare providers so products can be produced and tested in anticipation of receiving an order. Where the ordering and production requirements are communicated in partnership with our customers, QuVa can supply products within 48 hours including a certificate of analysis in support of the testing of the product.

What do you see as the future of outsourcing - are more drugs likely to be outsourced?

We believe that the need for outsourced compounding services will continue to grow. The driving factors will be continued initiatives by healthcare providers to reduce waste and medication errors, increase in-house pharmacy operation efficiencies, and to avoid capital expenditure to meet increasing legislative requirements. We anticipate a contraction in the number of individual product presentations through standardization efforts driven by ASHP and health care providers. This consolidation of product presentations will facilitate the level of product testing required of cGMP to be achieved in a cost-effective manner.

What do you believe is the current state of quality in the industry overall and in what specific ways do you believe it needs to be improved?

The pendulum of quality has definitely started moving in the direction the FDA has been advocating since 2013. The number of registered compounders exiting the market in recent months demonstrates that the momentum of change is increasing. There remains some denial, or conscious avoidance, of fully complying with the FDA promulgated guidance releases on quality until they are made “official.” There is little likelihood of meaningful change to the FDA guidance releases on quality standards from what is currently available in draft. The obvious example of this is to fully test product for sterility, potency, and endotoxins before release. The number of citations firms are receiving from the FDA on failing to do the appropriate testing prior to release indicates many compounders remain reliant on old practices without clear evidence their product output meets the required quality level. Healthcare providers can bring about change in the industry by insisting on evidence that any product they receive from their third party compound provider has been specifically tested for sterility, potency, and endotoxin.

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