FD&C Act Provisions that Apply to Human Drug Compounding

Sections 503A and 503B of the Federal Food, Drug, and Cosmetic Act (FD&C Act) specifically address human drug compounding, and reference other provisions of the FD&C Act. The following chart describes applicable FD&C Act requirements in different scenarios:

Scenario	Applicable Federal Requirements
Drugs compounded in accordance with all conditions of section 503A	Drugs subject to all provisions of the FD&C Act that apply to conventionally-manufactured drugs, except: Current good manufacturing practice requirements (section 501(a)(2)(B)) Labeling with adequate directions for use (section 502(f)(1)) Premarket approval requirements (section 505)
Drugs compounded in accordance with all conditions of section 503B	Drugs subject to all provisions of the FD&C Act that apply to conventionally-manufactured drugs, except: Labeling with adequate directions for use (section 502(f)(1)) Premarket approval requirements (section 505) Drug supply chain security requirements (section 582)
Drugs not compounded in accordance with conditions of sections 503A or 503B	Drugs subject to all provisions of the FD&C Act that apply to conventionally-manufactured drugs

Sections 503A and 503B and Their Differences

Section 503A of the FD&C Act applies to human drug compounding by a licensed pharmacist within a state-licensed pharmacy or federal facility, or by a licensed physician, that is not registered with FDA as an outsourcing facility. Section 503B applies to human drug compounding within an outsourcing facility. The following list highlights some of the key similarities and differences between sections 503A and 503B. See the following final guidance documents for a comprehensive list of the provisions of sections 503A and 503B:

Note the following chart includes some of the provisions in sections 503A and 503B. It does not include an exhaustive list of conditions or requirements that apply to compounded drugs. Other statutory provisions are applicable.

Provision	Section 503A	Section 503B
Available exemptions, if conditions are met	Drugs compounded in accordance with all conditions of section 503A are exempt from: Section 501(a)(2)(B) (current good manufacturing practice requirements), Section 502(f)(1) (labeling with adequate directions for use), and Section 505 (new drug approval requirements) Section 503A(a)	Drugs compounded in accordance with all conditions of section 503B are exempt from: Section 502(f)(1) (labeling with adequate directions for use), Section 505 (new drug approval requirements), and Section 582 (drug supply chain security requirements) Section 503B(a)
Types of compounder(s) to which the section applies	Compounding is by a Licensed pharmacist in a state-licensed pharmacy or federal facility, or Licensed physician Section 503A(a)	Compounding is by or under the direct supervision of a licensed pharmacist in an outsourcing facility (which is not required to be a licensed pharmacy). Sections 503B(a) and 503B(d)(4)(B)
Patient-specific prescriptions	Compounding must be based on the receipt of a valid prescription for an identified individual patient. It can occur after the receipt of the prescription, or in limited quantities before the receipt of such a prescription. Section 503A(a). See also, FDA’s final guidance concerning the prescription requirement under section 503A.	An outsourcing facility may or may not obtain prescriptions for identified individual patients. Section 503B(d)(4)(C)
Bulk drug substances	Bulk drug substance must be accompanied by a valid certificate of analysis and must have been manufactured by an establishment registered with FDA under section 510. In addition, the bulk drug substance must comply with an applicable United States Pharmacopeia (USP) or National Formulary (NF) monograph, if one exists, and the USP chapter on pharmacy compounding; if an applicable USP/NF monograph does not exist, be a component of an FDA-approved drug; or if such a monograph does not exist and the substance is not a component of an FDA-approved drug, appear on a list of bulk drug substances that can be used in compounding under section 503A developed by FDA through regulations. Section 503A(b)(1)(A). See also, FDA’s final guidance describing its interim policy for compounders using bulk drug substances while the list of bulk drug substances is being developed.	Bulk drug substance must be accompanied by a valid certificate of analysis and must have been manufactured by an establishment registered with FDA under section 510. In addition, the bulk drug substance must appear on a list developed by FDA of bulk drug substances that can be used in compounding under section 503B, or the drug compounded from the bulk drug substance must appear on FDA’s drug shortage list at the time of compounding, distribution, and dispensing. In addition, if an applicable USP, NF, or any other compendium or pharmacopeia monograph recognized by FDA for purposes of section 503B(a)(2) exists, bulk drug substances must comply with the monograph. Section 503B(a)(2) See also, FDA’s final guidance describing its interim policy for compounders using bulk drug substances while the list of bulk drug substances is being developed.
Drugs withdrawn or removed from the market	The drug is compounded by a licensed pharmacist or licensed physician that does not compound a drug product that appears on a list published by FDA of drug products that have been withdrawn or removed from the market because such drug products or components of such drug products have been found to be unsafe or not effective. Section 503A(b)(1)(C) and 21 CFR 216.24	The drug does not appear on a list published by FDA of drugs that have been withdrawn or removed from the market because such drugs or components of such drugs have been found to be unsafe or not effective. Section 503B(a)(4) and 21 CFR 216.24
Drugs presenting demonstrable difficulties for compounding	The drug is not identified by FDA by regulation as a drug product that presents demonstrable difficulties for compounding that reasonably demonstrate an adverse effect on the safety or effectiveness of that drug product. Section 503A(b)(3)(A)	The drug is not identified (directly or as part of a category of drugs) on a list published by FDA of drugs or categories of drugs that present demonstrable difficulties for compounding that are reasonably likely to lead to an adverse effect on the safety or effectiveness of the drug or category of drugs, taking into account the risks and benefits to patients. Section 503B(a)(6)
Drugs that are essentially copies	The drug is compounded by a licensed pharmacist or licensed physician that does not compound regularly or in inordinate amounts any drug products that are essentially copies of a commercially available drug product. Sections 503A(b)(1)(D) and 503A(b)(2) (defining “essentially a copy of a commercially available drug product”). See also, FDA’s final guidance.	The drug is not essentially a copy of one or more approved drugs. Sections 503B(a)(5) and 503B(d)(2) (defining “essentially a copy of an approved drug”). See also, FDA’s final guidance.
Interstate Distribution Limitations	Section 503A limits interstate distribution of compounded drugs to 5% or more, depending on whether the compounder is located in a state that has entered into a memorandum of understanding (MOU) with FDA addressing inordinate amounts of compounded drugs interstate and providing for appropriate investigation of complaints by a state agency. FDA published a notice describing the final MOU in October 2020. In August 2021, FDA published a notice updating it’s intended timing for enforcing the 5% limit. See FDA’s Compounding MOU webpage and Q&A site for further information. Section 503A(b)(3)(B)	No explicit condition in section 503B.
Wholesaling	No explicit condition in section 503A, but other requirements of the FD&C Act may apply	The drug will not be sold or transferred by an entity other than the outsourcing facility that compounded such drug. This paragraph does not prohibit administration of a drug in a health care setting or dispensing a drug pursuant to a prescription executed in accordance with section 503(b)(1). Section 503B(a)(8)
Registration and listing/reporting	No explicit condition in section 503A, but see section 510(g) of the FD&C Act.	The drug must be compounded in an outsourcing facility that is in compliance with the registration and reporting requirements of section 503B(b). Section 503B(a)(1)
Adverse event reporting	No explicit condition in section 503A.	Outsourcing facilities must submit adverse event reports to FDA in accordance with the content and format requirements established through guidance or regulation under 21 CFR 310.305 (or any successor regulations). Section 503B(b)(5) and FDA’s final guidance on 503B adverse event reporting.
Labeling	No explicit condition in section 503A.	The label and container of compounded drugs must contain certain information, such as the statement, “This is a compounded drug” on the label. Section 503B(a)(10)