Compounding Overview: Primary Considerations in the Workplace

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Technical, regulatory, and personnel considerations characterize pharmaceutical compounding.

Pharmaceutical compounding comprises activities associated with preparations that are not commercially available from major pharma industry. Compounded dosage forms have traditionally been prepared in response to individual patient needs in community settings; they are also prepared for future patients in physician’s offices and clinics. The scope of compounding considerations is extensive—patient information and therapeutics, dosage forms, preparation processes, regulations, personnel competencies, professional workplace settings, and so on. Compounded preparations include both sterile and non-sterile dosage forms—injections, ophthalmics, capsules, liquids, topicals, and numerous variations of each. Formulations address dosages of patients from neonates to seniors. Compounding occurs in many settings—community pharmacies, hospitals, outsourcing facilities, pharma industry, nursing homes, outpatient care, and numerous others. Regulations governing compounding include federal, state, and local requirements. Personnel involved in compounding have varied expertise and skills—pharmacists, physicians, nurses, scientists, chemists, engineers, technicians, and so on. Compounding also includes the preparation of equivalent commercial products when drug shortages occur; notable examples include certain beta-lactam products and ibuprofen (1–4).


FDA has defined human drug compounding and acknowledged its role in modern healthcare. FDA further commented on patient risk in using compounded preparations and described efforts to safeguard public health against poor quality compounding.

“Compounding is generally a practice in which a licensed pharmacist, a licensed physician, or in the case of an outsourcing facility, a person under the supervision of a licensed pharmacist, combines, mixes, or alters ingredients of a drug to create a medication tailored to the needs of an individual patient. Although compounded drugs can serve an important medical need for certain patients, they also present a risk to patients” (5).

“FDA’s compounding program aims to protect patients from unsafe, ineffective, and poor-quality compounded drugs, while preserving access to lawfully marketed compounded drugs for patients who have a medical need for them” (5).

“Compounding is also a practice that is under scrutiny by the Food and Drug Administration (FDA) because of instances in which medications, primarily injectable medications that are intended to be sterile, have endangered public health” (6).

Related terminology. Compounding involves changes to materials or products to prepare new medicinal formulations. Changes to commercial products following directions provided by the manufacturer, such as reconstitution of multidose containers or dissolving sterile lyophilized products, is not compounding (7). Transfer of product to a different containeris repackaging and is not compounding; preparing individual syringes from a larger container of drug product is repackaging. FDA has issued multiple guidance documents addressing repackaging (8,9). When a dose of medication is drawn for administration at the patient bedside, this action is neither compounding nor repackaging but is preparation for immediate use (7). The United States Pharmacopeia (USP) definition of compounding differs from the FDA definition, is much broader, and encompasses almost any manipulation of a commercial product (7,10,11).

Patient identification. Compounded preparations have traditionally been designed to address the therapeutic needs of individual patients. Name identification of the patient for whom medication is being compounded is a key requirement in traditional compoundingspecific patient, prescribing physician, and pharmacist/designee who prepares medication for immediate use (ASAP). Compounded preparations prepared on a larger scale for future use (“office stock”) have expanded the definition of compounding; preparing formulations for future use is non-traditional compounding. Specific patients are not identified in non-traditional compounding. Facilities engaged in non-traditional compounding may or may not be licensed pharmacies and are termed outsourcing facilities in FDA guidance documents. Prospective name identification of patients is a key element in differentiating types of compounding organizations in FDA regulations.

Medication safety. FDA has expressed concern for medication safety with use of compounded pharmaceuticals.Errors with compounded drugs are well known to have caused adverse events (12,13). Compounded preparations are not approved by FDA via the new drug application/abbreviated new drug application (NDA/ANDA) drug approval process. Medication safety in compounded preparations is the responsibility of compounding practitioners. The New England Compounding Center (NECC) incident in 2012 (14) heightened public awareness of problems with compounding and prompted regulations that significantly changed compounding practices. These regulations limited the scope of traditional compounding while enhancing patient safety in non-traditional compounding; GMP compliance is now required for non-traditional compounding.

Discussion topics

The discussion provides a general overview of US human drug compounding. Selected topics describe technical considerations, FDA regulations, and personnel responsibilities in the workplace environment—pharmaceutical compounding in a professional setting. Discussion topics include the following:

Pharmaceutics. Scientific and technical aspects of compounding such as formulation design, preparation, and calculations are fundamental in compounding. Compounded preparations must be technically sound.

Regulatory. Regulations governing compounding include federal, state, and local regulations. GMP is required for certain compounding.

Personnel. Compounding experts design dosage forms; staff prepares dosage forms; management monitors compounding performance, executes traditional management activities, and provides a workplace environment conducive to thoughtful compounding execution.

This discussion has been developed considering academic teaching experiences, experiences in multiple settings, and published reports of medication adverse events. Compounding education typically includes theory and techniques using placebo formulations in a classroom or laboratory setting—preparatory skills are the primary focus of compounding education. Compounding in the workplace is a different reality—potent drugs, compromised patients, emergency circumstances, imperfect facilities, time pressures, insufficient information, electronic systems, and problematic logistics with interruptions, interferences, and other distractions—all of which may contribute to substandard compounding and medication errors. Workplace conditions may be complex depending on the type, size, and circumstances of the compounding organization. Traditional compounding pharmacies that prepare dosage forms and dispense directly to patients have much different challenges than non-traditional outsourcing facilities that globally distribute their preparations. This discussion addresses key topics relevant to all compounding—technical aspects, federal regulations, and personnel considerations in the workplace environment.


Technical pharmaceutics principles are fundamental in dosage form design and preparation in all compounding; pharmaceutics provides the scientific basis for compounded dosage forms. Technical concepts especially relevant to compounding include solubility, dissolution, bioavailability, bioequivalence, chemical and physical stability, and many other considerations; specific principles associated with individual types of dosage forms must likewise be considered. Formulation materials, preparatory processes, associated calculations, and actual compounding techniques are of obvious importance in compounding. Multiple personnel are likely involved in compounding, including technical experts who integrate available information and calculate dosage, specialists who prepare the designed formulation, and pharmacists who counsel patients/clients on proper use of the compounded medication.


Formulation design is fundamental in compounding. Formulation ingredients, including the API, inactive excipients, and the primary container, comprise the compounded dosage form. All formulation components must be sourced from approved suppliers, meet quality standards, be inherently stable, and not be contaminated with chemical, microbial, or other foreign substances. Ingredients must be properly stored, be within expiration dating, and be acceptable for use. Assuming an appropriate active drug to treat the patient’s condition, inactive formulation ingredients are very relevant in compounded dosage form design. Inactive ingredients in compounded dosage forms may replace problem ingredients in commercial products (e.g., lactose is not used in compounded preparations for lactose-intolerant patients; dyes are not used in preparations for patients allergic or sensitive to colorants; peanut oil is not used in preparations for patients with peanut allergies). Liquid formulations of solid products may be prepared for children or seniors who cannot swallow tablets or capsules. The combined ingredients and primary package must be compatible and stable during the expected period of patient treatment. If an administration device such as an intravenous administration set, inline filter, or other device is needed to administer the compounded drug, these also must be compatible with formulation ingredients.


There are numerous types of calculations potentially used in compounding, depending on technical considerations, patient needs, and other factors. Formulation calculations such as percent calculations, API conversions, ratio strength, and others are necessary for preparation of dosage forms. Drugs are dosed based on the active drug; chemical forms of active drugs may be available in salt or other forms, and the appropriate amount to be compounded is calculated. Formulation dosage considerations including pharmacokinetic factors, drug half-life, bioavailability, renal clearance, liver function, and others must be calculated. Certain compounding requires final product testing such as potency, moisture, dissolution, microbial, and other testing—all of which require calculations. Shelf-life calculations with attribute stability data are used to justify expiry extensions.


Compounding procedure

Procedures for preparation of compounded pharmaceuticals are likewise critical. After the compounded formulation and compounding process are designed and material amounts are calculated, actual dosage form compounding with specified techniques is initiated. Policies and practices must be appropriate; skilled personnel must be trained as needed; aseptic techniques are especially important. Compounding skills are essential; a well-designed compounded preparation will fail if execution by the compounding technician is substandard or lacking; these may include order of mixing low-dose ingredients, particle size reduction, mixing, encapsulation, filtration, levigation, and other technical procedures. Basic aseptic techniques, clean-room equipment, and controlled air-particulate facilities are critical for sterile compounded preparations. Sterile compounded preparations are high-risk preparations due to their potential for microbial contamination. Allen (15,16), Institute for Safe Medication Practices (ISMP) (17,18), Gudeman et al. (19), and Watson et al. (20) have addressed errors associated with compounded preparations.


Related technical activities executed after completion of compounding must also consider pharmaceutics principles. Dosage-form testing (visual, USP, or other reference), labeling, medical information, packaging, supply chain shipping, and communication with patients/clients advising on proper use of the compounded dosage form must be consistent with technical principles. Light protection, temperature control, administration methods, and other post-compounding technical considerations are relevant.


FDA categorized pharmaceutical compounding facilities as 503A pharmacies and 503B outsourcing facilities in the Drug Quality and Security Act (DQSA) of 2013 (21). This amendment strengthened compounding requirements in the existing Food, Drug, and Cosmetic (FD&C) Act regulating compounded drugs and is the current legal basis for pharmaceutical compounding.

503A pharmacies. Section 503A of the FD&C Act identifies traditional compounding—individual patient, prescribing physician, registered pharmacist in a licensed pharmacy. Section 503A specifically exempts pharmacy compounding from federal regulations concerning GMP compliance, labeling requirements, and drug approvals via NDA/ANDA processes.

503A guidance documents. Pharmacy Compounding Under Section 503A of the FD&C Act (22) specifies applications, conditions, provisions, requirements, and enforcement of Section 503A. Preparations are compounded for an identified individual patient. 503A compounding must be compliant with applicable USP requirements. Drug and excipient quality requirements are specified. Compounding must not involve preparations that are copies of commercial products or be identified by FDA as difficult to compound. Compounded preparations must not exceed 5% of total dispensed products of the pharmacy. FDA enforcement conditions specifying adulterated, unapproved, and misbranded drugs will follow risk-based concepts addressing public health.

Hospital and Health System Compounding Under Section 503A of the FD&C Act (23) discusses actual human drug compounding practice in hospitals and clarifies requirements stated in the above 503A guidance. These practices are regulated primarily by state agencies and are not required to comply with GMP requirements. Some 503A pharmacies have distribution practices for compounded preparations that extend beyond their individual facility (i.e., 503B-like practices); compounded preparations may be transferred to other hospitals, clinics, infusion centers, or other facilities within a corporate healthcare system. This guidance addresses compounded preparations made in advance of specific patient orders that are essentially copies of commercial products; policy with rationale and limitations is proposed.

503B outsourcing facilities. FD&C Section 503B addresses organizations that prepare dosage units for sale to various healthcare providers in advance of specific patient identification (i.e., non-traditional compounding for “office stock”). Outsourcing facilities providing these preparations are not required to be a licensed pharmacy but must be supervised by a licensed pharmacist. Section 503B exempts these facilities from NDA/ANDA approval processes, certain product labeling regulations, and drug security requirements. However, Section 503B requires outsourcing facilities to be compliant with GMP regulations per 21 CFR §210 and 211 (24). Facilities that manufacture 503B sterile products must also register with FDA and pay an annual registration fee.

503B guidance. Drug Compounding Outsourcing Facilities Under Section 503B of the FD&C Act (25) addresses GMP requirements for outsourcing facilities. Specific sections in the guidance discuss quality assurance and quality control, facility design, control systems and procedures for maintaining suitable facilities, environmental and personnel monitoring, equipment, containers and closures, components, production and process controls, release testing, laboratory controls, stability/expiration dating, packaging and labels, and complaint handling (26).

This guidance reflects FDA’s intent to recognize differences between outsourcing facilities and pharma industry manufacturers while maintaining minimum safety standards for public health. The guidance follows a risk-based approach (i.e., it distinguishes between risk levels associated with compounding various dosage forms). Sections in the guidance specify considerations for sterile drug products. GMP-violative conditions in which FDA generally does not intend to take regulatory action are also described; two appendices further address GMP release testing and stability testing requirements.

503A and 503B characteristics summary. Primary differences characterizing 503A and 503B preparations and associated facilities are summarized in Table I. Items 1–3 list basic characteristics and specific exemptions from FD&C requirements; items 4–16 are requirements for compounded preparations; item17 lists GMP requirements. GMP compliance includes documented systems and procedures. Exceptions to described characteristics are possible (e.g., a facility may have both 503A licensed pharmacy and 503B outsourcing operations and must follow certain specified facility requirements). Item 18 identifies primary audit responsibilities.

Regulatory compliance and inspections. Compounding organizations are regulated by state and federal requirements and may thus be audited by both state agencies and by FDA. 503A pharmacies are inspected primarily by state auditors. If FDA inspectors provide observations to 503A pharmacies, follow-up may be delegated to state authorities. 503B compounding facilities must comply with GMP requirements and are audited primarily by FDA. The FDA website provides FDA-483 observations, Warning Letters, and associated correspondences involving compounding facilities (27). FDA has discussed activities for compounding pharmacies following receipt of an FDA-483 (28).

Staff and management in the workplace

Personnel in compounding organizations have significant responsibility in support of pharmaceutical compounding in the workplace setting. Excluding automated systems, much of the work in compounding requires human performance. Staff designs and prepares the compounded dosage forms—the objective of the compounding function. Personnel involved in pharmaceutical compounding must have appropriate technical expertise and must continually maintain their competence. Technical expertise includes theory, practice, techniques, and awareness of common errors experienced in compounding practice.

Management in compounding organizations must monitor actual compounding as well as execute traditional managerial responsibilities such as hiring, scheduling, training and development, facilities and equipment maintenance, facility cleanliness, and numerous other activities. Management is ultimately responsible for policies, procedures, and quality systems supporting the compounding effort; this responsibility is substantial for 503B outsourcing facilities that must comply with GMP. Management must integrate technical compounding performance and daily workplace operations to develop and maintain a quality culture in the compounding organization conducive to serious thought and deliberation. Medication errors have been caused by dosage form design omissions, deficient technical knowledge, insufficient training, distractions, superficial documentation, inexperience, and other issues—all of which are caused by staff and ultimately attributable to management. Regular management communication to heighten staff awareness of problematic situations and potential medication errors has been recommended to mitigate the potential for medication errors (34).

Supporting references and standards

Numerous references supporting 503A and 503B pharmaceutical compounding relevant to technical considerations and regulatory compliance are available from a variety of sources. USP <795>, <797>, and <800> (35–37) are primary documents describing compounding standards; these documents have legal basis and are often cited in FDA-483 observations. USP offers on-demand courses on these chapters (38). USP also contains more than 100 compounding-related chapters (39,40). Current revisions to USP <795> and <797> have proposed a designated person to be responsible for compounding policies, practices, and procedures in organizations (41). The Joint Commission offers certification in pharmaceutical compounding focusing on the above-mentioned USP chapters (42). FDA offers training on various compounding activities through their Compounding Quality Center of Excellence (43). Other documents available through the American Society for Health System Pharmacists (ASHP) (44) and the ISMP (45) are useful to identify potential medication safety risks.

Quality risk management and human factors engineering

Organization staff and management must collaborate to develop a quality culture in the compounding organization. Principles associated with ICH Q9(R1) Quality Risk Management (QRM) and Human Factors Engineering (HFE) are directly applicable to compounding organizations. ICH Q9(R1) describes hazard evaluation in various aspects of pharmaceutical manufacturing (46). Compounding organizations should use a similar approach to evaluate potential for problematic compounding issues. Risk analysis should be an ongoing activity using formalized methods such as failure mode and effect analysis (FMEA) or other risk methodologies; root cause analysis to mitigate hazard situations logically follows.

HFE is another discipline relevant to compounding organizations. HFE (47,48) addresses human performance and interactions with technology, processes, device operation, user interface, and the use environment in many industries. Whenever human performance is involved, errors, omissions, misunderstandings, shortcuts, and other potential deficiencies may occur—and essentially everything in compounding is done by humans. Electronic systems are commonplace in compounding equipment; personnel who override electronic systems designed to prevent drug safety issues exemplify HFE problems. HFE activities and training on equipment use must be ongoing in compounding organizations.

Preventive actions and corrective actions

Staff and management in compounding organizations must endeavor to proactively prevent hazards that may result in substandard compounding and medication errors; note the deliberate transposition of traditional corrective and preventive actions (CAPA) to preventive actions and corrective actions (PACA) to emphasize proactive vs. reactive responses to hazards. Medication error data indicate that 7000–9000 annual deaths in the United States are due to medication errors; FDA receives more than 100,000 reports of medication errors every year—both are likely conservative estimates (49,50). ICH Q9(R1) has also encouraged proactive hazard prevention rather than hazard correction after an adverse event (46). Patients obviously suffer when medication errors are made; overdoses may be toxic and underdoses ineffective. Healthcare practitioners responsible for errors are likewise affected—often suffering personal remorse and emotional distress, sometimes with fatal consequences (51). Responsible supervision and the organization suffer embarrassment, negative publicity, regulatory issues, legal action, financial liability, and other undesirable outcomes. Safeguards to prevent substandard compounding and possible medication errors should be integrated within the pharmaceutical compounding process.

Documentation and compliance

Documentation is intrinsic to pharmaceutical compounding and GMP compliance; documentation is a primary responsibility of organization staff and management. Most relevant to this discussion is documentation directly associated with the preparation of compounded dosage forms. This documentation provides descriptive information, ingredient listing, ingredient lot numbers, preparative procedure, expiration/BUD, other key information, and accountability of personnel involved in the compounding process; this documentation provides lasting traceability of the dosage form. Other associated compounding documentation supporting site quality systems and GMP compliance include personnel training records, performance certification, equipment qualification, facility maintenance, cleaning, sanitization, and related activities. Representative documentation examples are illustrated in USP chapters and compounding texts (15,39). The pharma industry adage “If it isn’t written down, it didn’t happen” must also be practiced in pharmaceutical compounding operations (52).


This discussion provides an overview of key elements in pharmaceutical compounding. FDA has generally defined pharmaceutical compounding. Compounded pharmaceuticals are specially prepared and are not commercially available from big pharma. Compounding requires changes to materials and is distinguished from repackaging and drug-readiness for administration. FDA has also cautioned against risks associated with compounded preparations.

Technical. Formulation, calculations, and actual compounding performance are primary technical pharmaceutics areas relevant to compounded preparations. Compounded pharmaceuticals may include sterile and non-sterile preparations prepared for individual patients at local pharmacies or in hospitals. Compounded pharmaceuticals also include formulations prepared in larger quantities and sold to physicians, clinics, or other treatment entities (“office stock”) for future patient treatment. Actual compounding technical competency in aseptic techniques is critical in sterile compounding. Multiple individuals are likely involved in the technical design and actual preparation of compounded pharmaceuticals ultimately leading to correct use of the compounded dosage form by the patient/client.

Regulations. Legislation enacted following the New England Compounding Center incident in 2012 explicitly categorized pharmaceutical compounding operations. Compounding facilities are either 503A pharmacies (traditional compounding for identified patients) or 503B outsourcing facilities (non-traditional compounding for future patients). GMP requirements in 503B facilities include requirements for release testing, stability and file samples, validation, environmental monitoring, and other requirements. State inspectors audit 503A pharmacies; FDA investigators audit 503B facilities and may issue FDA-483 observations if non-compliant conditions are observed.

Personnel. Compounded preparation quality is dependent on human performance in the workplace environment (i.e., functions that are the responsibility of staff and management). Human performance in compounded dosage form design, preparation, documentation, and user communication is critical for successful compounding. Workplace interruptions and interferences in expected performance may negatively impact human performance and compounded medication safety. Compounding personnel must be conversant with key compounding guidances such as USP <795>, <797>, and <800>. QRM and HFE concepts are directly applicable to pharmaceutical compounding.Documentation and compliance considerations are routine performance by compounding personnel. Staff and management must collaborate to develop a quality culture in their organization.


Comments from Varanya Chaiyaperm, RPh, PharmD, clinical assistant professor, University of Illinois College of Pharmacy; Jan M. Keresztes, RPh, PharmD, pharmaceutical educator; Alan M. Mancini, RPh, pharmaceutical scientist; Jeanne Moldenhauer, pharmaceutical consultant, Excellent Pharmaceutical Consultants; William R. Porter, PhD, principle scientist, Peak Process Performance Partners; Richard Poska, RPh, pharmaceutical scientist, Flexo; and Nishant B. Thakar, RPh, PharmD, assistant professor clinical sciences, Roosevelt University College of Pharmacy are greatly appreciated.


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About the author

Paul L. Pluta, PhD, RPh, is a pharmaceutical scientist with pharma industry, academia, journal editorship, community pharmacy, and hospital pharmacy experience.