Understanding the differences between 503A, 503B compounding pharmacies

What Is a Compounding Pharmacy?

A compounding pharmacy is a specialized pharmacy that creates customized medications tailored to individual patient needs by mixing, combining, or altering ingredients. However, only licensed pharmacists, doctors, and people under the supervision of a licensed pharmacist can make compounded medications. These pharmacies address unique medical requirements by providing medications that exclude allergens, adjust dosages, or add flavors for better palatability.  

While the FDA has approved the individual medicines used in a compounding pharmacy, it does not approve compounded drugs like traditional prescription drugs, including their dosages. Consequently, the FDA cannot confirm the safety or effectiveness of a compounded drug as it does for commercially manufactured drugs. 

There are approximately 56,000 community-based pharmacies in the US. Among these, around 7,500 provide compounding services. Some estimates suggest that over 32,000 pharmacies nationwide offer some form of compounding, but roughly 40% of professionals capable of compounding drugs work in pharmacies dedicated exclusively to compounding. As defined in the Drug Quality and Security Act of 2013, compounding pharmacies can be categorized into traditional (503A) and outsourcing (503B) compounding pharmacies. 

What Is a 503A Compounding Pharmacy?

Mostly managed by the state, 503A pharmacies are traditional compounding pharmacies that compound medications based on prescriptions specific to individual patients. For example, a 503A pharmacy may compound medication for a patient with allergies to an inactive ingredient in their prescription medication. To make the drug safe for a patient with allergies, pharmacists at 503A compounding pharmacies may isolate the active ingredient in a particular drug and stabilize it with inactive components that the patient is not allergic to. 

These pharmacies must comply with the guidelines set by the United States Pharmacopeia (USP) and are subject to state boards of pharmacy oversight. They must follow cGMPs to ensure the safety and quality of compounded medications. These pharmacies are limited to dispensing medications for home use, which can result in higher production costs due to restrictions on batch sizes.

What Is a 503B Compounding Pharmacy?

A 503B compounding pharmacy, also known as a 503B outsourcing facility, can produce large batches of medications without patient-specific prescriptions and sell them directly to healthcare facilities. This capability allows them to lower manufacturing costs and offer more affordable medications to consumers. Also, when medications are on the FDA drug shortage list, 503B pharmacies may produce compounded versions of the drugs for widespread distribution. 

Because of this, 503B compounding pharmacies are held to higher regulatory standards than traditional 503A compounding pharmacies. Although outsourcing facilities must be registered with the FDA and comply with cGMP validation and testing, these drug products are exempt from FDA drug approval requirements and the mandate to be labeled with adequate directions for use.  

To allow efficient and timely access to medications for patient care, 503B compounding pharmacies sell and directly distribute ready-to-administer sterile medications to healthcare facilities. Working with a 503B compounding pharmacy can offer several advantages for hospitals — such as helping reduce drug costs, increasing regulatory compliance, and providing longer beyond-use dating for medications. They can also help alleviate drug shortages by producing medications in significant quantities. 

Differences

Key differences between 503A and 503B compounding pharmacies include their operational focus and regulatory requirements.  

For instance, while 503A pharmacies are adept at providing customized medications that comply with USP guidelines, they face limitations in batch size and regulatory standards. Conversely, 503B pharmacies benefit from economies of scale and stringent quality controls but are less centered on individualized patient care. They also must adhere to current cGMPs, register with the FDA, and provide product lists. 

Similarities

Several key similarities also exist between 503A and 503B compounding pharmacies. For example, both specialize in creating tailored medications when commercial drugs are unsuitable and must ensure their compounded products' safety, quality, and efficacy. They must comply with the Federal Food, Drug, and Cosmetic Act and are prohibited from compounding copies of commercially available drugs unless there is a clinical difference. Additionally, both types of pharmacies address the need for customized medications unavailable in the marketplace, often catering to patients with unique conditions or allergies.