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The Drug Compounding Debate and its Importance to Dermatologists

The Drug Compounding Debate and its Importance to Dermatologists

drug compounding

This article describes the current federal policy debate regarding compounding and offers suggestions on how physicians can make their voices heard.

Health care providers often use compounded drugs—therapeutic agents that must be combined, mixed, or altered to suit individual patient needs.1 These formulations may account for as much as 5% of all prescriptions filled nationwide.2 Recently, federal and state governments have considered legislation to limit compounding with the intent of improving patient safety. However, many providers argue that these new regulations will actually harm patients given that it will become more difficult to produce medicine tailored to specific patient needs. 

Dermatologists are especially affected by these changes as many of our commonly-prescribed and clinic-administered drugs are compounded.3 This article describes the current federal policy debate regarding compounding, provides examples of common dermatology products that would be affected by the legislation, and suggests ways for physicians to make their voices heard. 

Compounded Drug Regulations

While the FDA does not approve compounded products in the same way that it approves other medications, the agency is permitted to regulate compounding practices. The Table compares characteristics of FDA-approved drugs and compounded drugs.4


Many of the current guidelines for compounded drugs are based on the 1997 Food and Drug Administration Modernization Act.5 This legislation sought to update pharmaceutical regulations that had been originally drafted in the early 20th century, and established conditions that must be satisfied for compounded drugs to be prescribed for human patients. 

Despite these regulations, a significant number of adverse events were linked to unsanitary compounded drugs between 2001 and 2013, the most serious of these involving a multistate outbreak of fungal meningitis.6 In response, the federal government passed legislation to specify guidelines for in-office compounding, and distinguish between 2 categories of compounding pharmacies: in-office pharmacies (503A facilities), and outsourcing facilities (503B facilities).

Current Controversy

In April 2016, the FDA under the Obama administration issued a ruling that significantly curtailed in-office compounding, stating that this type of compounding could only occur in “limited quantities” of “no more than a 30-day supply…to fill valid prescriptions it has not yet received.” Only outsourcing facilities were permitted to “compound and distribute […] products to hospitals, clinics, and health care practitioners for office use.”5 

All compounding pharmacies were required to register with the FDA as drug manufacturers. This ruling was intended to further strengthen safety regulations by preventing office-to-office variation in compounded drug quality and shifting compounding practices to outsourced pharmacies. Since 2016, several state governments have considered similar legislation to further restrict in-office compounding. However, various health providers believe that this regulatory trend has created unnecessary obstacles toward dispensing beneficial medications.

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Examples of Compounded Drugs

Dermatologists are disproportionately affected by this legislation given that many common dermatologic products are compounded.3 Some examples include:

  • Injectable lidocaine buffered with bicarbonate
  • Intralesional triamcinolone (Kenalog) diluted to a custom dilution
  • Reconstituted botulinum toxin
  • Certain topical anesthetic creams (ie, 23/7 cream: lidocaine 23%, tetracaine 7%)
  • Cantharidin
  • Squaric acid dibutyl ester (SADBE)
  • Topical or injectable 5-fluorouracil

Without robust in-office compounding pharmacies, dermatologists will be forced to delay patient care to a separate visit while obtaining these medications from third-party outsourcing facilities. In turn, this will delay appropriate patient care and increase costs to the patient and the health care system. The new legislation will also result in additional hurdles for patients who rely on custom medications due to allergies, insurance coverage, nonresponse to commercially-available medications, or other reasons. 

The FDA is focusing on a few egregious examples of safety violations, while ignoring the large body of evidence that supports the safety of compounded drugs. In fact, multiple studies have confirmed that compounded drugs have the same efficacy, and same rate of adverse medication events compared with traditional drugs.7,8 This also has been shown to be the case for compounded drugs in settings other than dermatology, such as injectable anesthetics for chronic pain management.9,10 Thus, these regulations, while well-intentioned, will increase patient and clinician burden and costs while having a minimal impact, if any, on patient safety. 

Next Steps

There are several methods for dermatologists to voice their opinions on compounding legislation. The first is through participation in the first national survey of dermatologists’ opinions regarding drug compounding. This survey is funded through a grant from the American Society of Dermatologic Surgeons and is administered through the University of Chicago. The federal government has often failed to take dermatologists’ preferences into account regarding compounding regulation because there have been zero national surveys on this topic. The results of the compounding survey will be used to inform ongoing policy discussions at federal and state levels. The survey can be accessed at

The second method is by voicing support for the Preserving Patient Access to Compounded Medications Act (HR 2871), a bill that would reduce various drug compounding regulations and decrease the FDA’s regulatory role. Specifically, this legislation would:

  • Allow increased in-office compounding
  • Exempt interstate distribution limits on compounded drugs

Dermatologists can call their Congressional representatives to support this legislation and join forces with any health providers who share the goal of decreased regulation and improved patient access to compounded medications. 


Mr Hussain is a medical student at the University of Chicago, Pritzker School of Medicine and Harris School of Public Policy, in Chicago, IL. He can be reached at

Dr Bolotin is with the University of Chicago, department of medicine, Chief, Section of Dermatology, in Chicago, IL.


Disclosures: The authors are the recipients of a $6350 grant from the American Society of Dermatologic Surgeons to investigate dermatologists’ opinions on drug compounding.



1. Sellers S, Utian WH. Pharmacy compounding primer for physicians: prescriber beware. Drugs. 2012;72(16):2043-2050. 

2. Scheinfeld N. Recent development in compounding law. The Dermatologist. 2007;15(1). Accessed May 23, 2018.

3. Smith MC, Kibbe AH, Brown TR. Dermatologie prescriptions requiring compounding. J Am Acad Dermatol. 1984;11(1):148-151. 

4. Krochmal L. Considerations before choosing (extemporaneously) compounded products. Dermatol Ther. 2009;22(3):225-228. 

5. FDA issues final 503A compounding guidance prohibiting office use. American Pharmacists Association. Published January 17, 2017. Accessed May 23, 2018.

6. Shehab N, Brown MN, Kallen AJ, Perz JF. U.S. compounding pharmacy-related outbreaks, 2001-2013: Public health and patient safety lessons learned [published online May 21, 2015]. J Patient Saf. doi:10.1097/PTS.0000000000000188.

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8. Dohil MA. Efficacy, safety, and tolerability of 4% 5-fluorouracil cream in a novel patented aqueous cream containing peanut oil once daily compared with 5% 5-fluorouracil cream twice daily: Meeting the challenge in the treatment of actinic keratosis. J Drugs Dermatol. 2016;15(10):1218-1224.

9. Best CA, Best AA, Best TJ, Hamilton DA. Buffered lidocaine and bupivacaine mixture - the ideal local anesthetic solution? Plast Surg (Oakv). 2015;23(2):87-90.

10. Weilbach C, Hoppe C, Karst M, et al. Effectiveness of various formulations of local anesthetics and additives for topical anesthesia - a prospective, randomized, double-blind, placebo-controlled study. J Pain Res. 2017;10:1105-1109. 

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