Pharmacy Regulation

In the medical industry, drugs and medical devices are rigorously regulated from the point of pre-clinical testing to wholesale distribution. Manufacturers submit safety, effectiveness, and quality data along with label materials in an application to a country’s regulatory authority or agency for market approval (Table 1). Quality assurance is achieved through the design and execution of well-defined quality system processes; such as processes with respect to complaint handling, non-conforming product handling, recall management, drug adverse event or device problem reporting, design controls, manufacturing and packaging controls, self-inspection, sanitary and maintenance procedures for facilities and equipment. Currently, the regulatory landscape is expanding to encompass the pharmacy, specifically in the areas of drug compounding and online pharmacies.  

Table 1: Common Regulatory Submissions for Initial Product Market Approval



Medical Devices


New Drug Submission (NDS)

Abbreviated New Drug Submission (ANDS) (generics)

Medical Device License Application


New Drug Application  (NDA)

Biologic License Application (BLA) (biologics)

Abbreviated New Drug Application (ANDA) (generics)

Premarket Notification (510(k))

Premarket Approval (PMA)


Marketing Authorization Application (MAA)

Technical File (TF) for CE Mark

Drug Compounding

Licensed pharmacists practice traditional drug compounding, mixing drugs or drug ingredients to cater to an individual patient need, usually one not met by an approved drug product on the

market. For example, a licensed pharmacist changes a solid drug product to a liquid dosage form for a paediatric patient; the liquid dosage form of the product is not approved by the US regulatory authority, the Food and Drug Administration (FDA). Compounding quality is addressed in the USA by the Drug Quality and Security Act (DQSA) and the Federal Food, Drug and Cosmetic Act (FDCA). Current legislation, specifically section 503A of the FDCA exempts licensed pharmacies, physicians and practitioners from the above market approval, label compliance and quality assurance requirements if they comply with specific exemption



Firstly, for exemption, there needs to be a valid prescription order from a licensed physician for a compounded drug product for an identified patient. In lieu of this, for limited drug compounding, the licensed pharmacist / physician should have a history of receiving such prescription orders through his / her relationship with either the patient or prescribing practitioner. Several other criteria for exemption (from market approval, label compliance and quality assurance requirements) deal with the drug product being compounded.

For instance, bulk drug substances used for compounding need to be either on the US Food and Drug Administration’s (FDA) acceptable list or included as a component in a FDA approved drug product, have a valid certificate of analysis (CoA) and be manufactured by a facility registered with the FDA. Applicable United States Pharmacopoeia (USP) / National Formulary (NF) monographs may be relied on for compliance of ingredients other than bulk drug substances and of bulk drug substances not on FDA’s acceptable list. Compounded drug products must also comply with USP pharmacy compounding chapters (USP<795>, USP<797>) and may not be on FDA’s list of withdrawn / removed products. Other exemptions address product safety and effectiveness, limit the amount of compounded drug products that are distributed interstate or that are copies of commercial drug products. Some of these exemptions are in development and are not yet enforced.


All compounded drug products need to be free from contamination and from marketing or labeling material that is false and misleading. Where the drug is recognized in an official compendium, the drug must comply with the compendium equaling the compendium in quality, purity, strength; and follow the compendium’s packaging and labeling instructions or requirements.

Outsourcing Facilities for Sterile Drug Compounding


Several recalls due to contamination in the compounding of sterile drug products caused the FDA to enable licensed pharmacies and other facilities compounding sterile drug products to voluntarily register as outsourcing facilities. By registration, outsourcing facilities are exempt from the market approval requirements of drug manufacturers while assuring FDA of quality compliance to current good manufacturing practices (CGMP). Registration is to be renewed annually. To qualify as an outsourcing facility, facilities must additionally comply with other conditions under section 503B of the FDCA. 

Some of these are similar to compliance requirements of other drug compounders subject to section 503A (FDCA). These include specific requirements for bulk drug substances and other ingredients as well as prohibited compounding of certain drugs (e.g. drugs that are essentially copies of approved drugs, on FDA’s withdrawn / removed products list or demonstrate adverse safety / effectiveness).

However, outsourcing facilities have additional compliance requirements such as special controls for compounding of drugs and bulk drug substances of drugs subject to risk evaluation and mitigation strategies (REMS), reporting of drug adverse events and certain other product information to FDA. Outsourcing facilities are subject to risk based inspections by the FDA to ensure quality compliance. 

Biologics and Repackaged Drug Products

Biological products or biologics include therapeutic proteins, monoclonal antibodies, allergenic extracts, blood and blood derivatives, cell and gene therapy products, preventive and therapeutic vaccines. Biologics often need mixing, diluting and re-packaging, for instance, to deliver a pediatric strength or dosage form not commercially available. Biologics are labile and sensitive to storage and handling conditions. Prescription drugs may be re-packaged for various reasons including drug-device administration and special patient needs. Improper re-packaging can adversely impact drug safety, quality and efficacy. Mixing and diluting of biologics and re-packaging of biologics and other drugs are therefore subject to the market approval (Table 1), quality and labeling compliance requirements initially discussed and expected of manufacturers.

However, FDA does provide certain drug compounding entities (generally, state licensed pharmacies, outsourcing facilities and federal facilities) with exemption from these requirements for certain biologics and non-biologic prescription drugs. Not all biologics or re-packaged drugs are considered for exemption. For instance, blood and blood components for transfusion, cell and gene therapy products, and vaccines are not considered for exemption. Neither is drug re-packaging for patient point of care administration nor direct to customer dispensation. The above compounding provisions of the FDCA (sections 503A & 503B) do not address the exemption criteria for applicable biologics and repackaged drugs. Where the biologic or re-packaging process qualifies, exemption from market approval, quality and labeling requirements is conditional upon compliance to various criteria. These include but are not limited to specific conditions that constitute a valid prescription order, requirements pertaining to a beyond use date (BUD), BUD supportive microbial challenge studies, product labeling, sale and distribution, bi-annual & adverse event reporting to FDA, and specific sterility tests.

Pharmacy Compounding Devices (PCDs)


Today pharmacy compounding devices (PCDs) are used to compound injections according to approved drug product labeling. These apparatuses, often controlled by software, deliver a specified volume of one or more injections through a designated fluid pathway to obtain in a receiving vessel an injection with a specific concentration of ingredients differing from the initial injections. PCDs pose a number of moderate risks. For instance, failures in device design or software and incorrect use could lead to delivery of incorrect drug quantities or concentration and contamination of product. Electrical design failures or shielding can lead to electromagnetic interference (EMI) and / or unsafe current leakage which can cause operational failures, electric shocks, burns or death.

PCDs may be exempt from market approval (regulatory filing to FDA: premarket notification/510(k)) if they are substantially equivalent to a legally marketed device in intended use and fundamental scientific technology and comply with additional risk mitigation controls. These controls can be implemented in labeling (e.g. warnings/instructions to prevent PCD cross-contamination/inaccuracy), design (e.g. validation of all performance claims relating to product potency, quantity, quality, and purity) and software (e.g. controls to ensure sensor effectiveness in alerting users of PCD safety / performance failure). Various FDA recognized consensus standards can be adhered to for compliance with these exemptions to premarket notification. However, ancillary devices making up the delivery and container system (e.g. fluid transfer sets, metering chambers, I.V. bags, connectors, or other components that provide a fluid contact surface) may require premarket notification as they are not accessories to PCDs.

Online Pharmacies


Due to the presence of illegitimate online pharmacies and falsified or fake medicines sold online, online pharmacies are the subject of increased monitoring by regulatory authorities like Health Canada, US FDA and the European Medicines Agency (EMA). In general, for legitimacy, regulatory authorities commonly advise that online pharmacies

  • display their physical address, phone number and pharmacist contact details;
  • have a license issued by the responsible pharmacy licensing body (e.g. Canadian provincial colleges of pharmacy, US state boards of pharmacy);
  • offer prescription drugs approved by the regulatory authority responsible for the jurisdiction of sale (e.g. prescription drugs in Canada must bear a Drug Identification Number (DIN) as a sign of Health Canada approval for market);
  • offer prescription drugs only in fulfillment of a valid prescription order; andmake no false or misleading claims for products on sale.

Consumers are encouraged to check public listings of online pharmacies on websites of regulatory authorities to be assured of their legitimacy. Europe has gone further with their Falsified Medicines Directive which requires the display of the following logo (1) on the homepages of online pharmacies.

Figure 1: EU Logo for Legitimacy of Online Pharmacies (1)

The rectangle on the middle left side will contain the flag of the EU country where the online pharmacy is established. The text gets translated into the official language(s) of that country. The logo is hyperlinked to the website of the national regulatory authority where the online pharmacy is listed (1).

Consulting Services

In conclusion, the scope of regulatory oversight increases to cater to the various regulatory compliance needs of different entities at the pharmacy level (Table 2) in the global supply chain.

Table 2: Scope of Regulatory Support needed by Differing Entities at the Pharmacy Level



Entity at Pharmacy Level

Scope of Regulatory Support

Licensed pharmacies, physicians and practitioners involved in drug compounding

·         determining whether compounded drug products and pharmacy compounding device systems qualify for exemptions from regulatory compliance requirements (market approval, label compliance and quality assurance requirements); and

·         complying with above regulatory compliance requirements when not exempt

Licensed pharmacies and other facilities compounding sterile drug products desiring to qualify as outsourcing facilities

·         compliance with conditions in section 503B of the FDCA (to qualify as an outsourcing facility)

·         initial and annual facility registration;

·         development, training & implementation of a CGMP compliant quality system including procedures for drug adverse event reporting; and

·         FDA reporting as outsourcing facility

·         audits (e.g. FDA audit preparation & hosting)

State Licensed Pharmacies, Federal Facilities, Outsourcing Facilities

·         compliance where mixing, diluting & re-packaging of biologics and other drugs qualify for exemption from regulatory compliance requirements (market approval, quality & label compliance)

·         compliance with above regulatory compliance requirements when not exempt

Online pharmacies

·         support in ensuring legitimacy

Regulatory authorities & Pharmacy licensing bodies

·         monitoring and development of internal quality management systems for compliance oversight and regulation


1. European Commission - PRESS RELEASES- Press release - Buying medicines online? Commission introduces logo to make sure consumers are safe [Internet]. 2015 [cited 08 February 2015]. Available from: