US Pharm. 2011;36(11):68-71.
The FDA, after several lengthy and unsuccessful attempts to restrict compounding pharmacies from engaging in this historical and central practice of pharmacy, has once again tried to get a court to recognize its authority over the subject matter. And, once again, it lost. There is nothing new in the attempts by the FDA to expand its power by regulating a multitude of issues affecting pharmacy practice and the rights granted to states by the U.S. Constitution. The ability to control liability for use of FDA-approved drugs, access to experimental drugs, and especially pharmacy compounding are all part of the FDA’s plan to regulate drug use issues.1-3
This time the FDA investigated a pharmacy that compounds large amounts of veterinary products from bulk chemicals, arguing that Congress has given the Agency the implied regulatory power to prohibit pharmacies from manufacturing new drugs under the guise of compounding.
This case involves a Florida pharmacy that provided the compounded veterinary drugs that caused the death of 21 horses on the Venezuelan National Polo Team in 2009.4 The team was competing at the U.S. Open Championship match at the Polo Club Palm Beach in Wellington, Florida. In April 2009, a veterinarian commissioned Franck’s Compounding Lab, a division of Franck’s Pharmacy located in Ocala, Florida, an area known for its density of equestrian farms and training centers, to compound an injectable solution of the prescription drug Biodyl (cyanacobalamin).5 This drug is a veterinary nutritional supplement (vitamin) manufactured by the French company Merial. Biodyl is not approved by the FDA and thus is not commercially available in the U.S.; however, it is administered frequently to horses in this country for exhaustion. It contains a mixture of vitamin B12, selenium (a form of sodium selenite), and other minerals. Due to a mathematical error (the all-too-common misplacement of a decimal point) in the conversion of selenium, the solution was too potent. The death of the horses was traced back to the compounding pharmacy because the five horses on the team that were not administered the compounded product lived.6
Following this incident, the Florida Board of Pharmacy opened a full investigation. The board determined that the error was a mathematical problem, having nothing to do with preparing the compound from bulk materials. Franck’s was fined and reprimanded by the board but was allowed to continue its extensive business of drug
A Brief History of Franck’s Pharmacy
The owner, Paul W. Franck, had been a Florida pharmacist in good standing since the early 1980s. Over the years, he expanded his business by buying or opening community pharmacies, including one in Ocala in 1985. At that location, Franck’s Pharmacy began compounding drugs for humans and nonfood-producing animals, such as horses. The Ocala location was later expanded into two distinct divisions, Franck’s Labs, which operates the compounding practice, and Franck’s Pharmacy, which operates as a typical retail pharmacy. At the time of the FDA complaint central to this case, Franck’s employed 65 full-time workers. The animal compounding operation accounts for approximately 40% of Franck’s total business revenues, with the rest coming from standard pharmacy practice. In addition to compounding animal drugs for Florida veterinarians, Franck’s also received prescriptions and mailed back compounded products to 47 other states where it holds valid pharmacy licenses, filling an average of 37,000 veterinary prescriptions each year.8
The vast majority of the animal medications it compounds come from “bulk” ingredients. This term does not refer to the size, volume, or quantity of the chemicals used in compounding. Rather, it means “the raw chemical materials used in the compounding process.” In regulatory terms, bulk drug substance is defined as “any substance that is represented for use in a drug and that, when used in the manufacturing, processing, or packaging of a drug, becomes an active ingredient or a finished dosage form of the drug.”9 Compounding from bulk ingredients is also known as bulk compounding.
The FDA Gets Involved
While the Florida Board of Pharmacy was satisfied with its findings that the horse deaths were caused by a calculation error in making the injected solution that did not warrant any further punishment of the pharmacy, the FDA was not content to let the matter settle. It proceeded to visit Franck’s facilities three different times from May to December 2009, each visit lasting several days. Interestingly, the Venezuelan National Polo Team incident was not the first time that Franck’s had been investigated by the FDA. In September and October 2004 and January 2005, the FDA issued a warning letter to Franck’s expressing concern that it was unlawfully manufacturing “new” drugs without the FDA’s prior approval. Franck’s responded in writing to the effect that it did not manufacture new drugs and that it believed it was in full compliance with all regulatory mandates. The FDA did not respond to this letter and took no further investigatory action against the pharmacy.10
Allegations and Responses
After the investigations resulting from the death of the polo horses in 2009, the FDA sent Franck’s a “Form 483” notice containing five specific observations of alleged violations, none of which involved bulk compounding of animal drugs as a concern. The Form 483 notification is used for “Factory Inspections” to communicate “inspectional observations” and concerns discovered during its inspection.11 As required by the regulations,12 Franck’s responded to the FDA that it did not agree with the statements claiming violation of federal laws and asserting that compounding is regulated by the states, not by the FDA or the federal government. Without any other response or communication, arguably required by the FDA’s own procedures,13 the FDA filed a complaint in a Federal District Court in Ocala, seeking an injunction to prohibit Franck’s practice of distributing animal drugs compounded from bulk substances.14 Franck’s responded with a motion to dismiss the complaint. After lengthy legal maneuvers by both parties, the judge listened to extensive oral arguments on February 24, 2011. On September 12, 2011, the judge issued an 80-page opinion delving mostly into the statutory construction of the Food, Drug, and Cosmetic Act of 1938 (FDCA), the relevant amendments, and the FDA’s own regulations promulgated to enforce the congressional intent of the Act.15
Displaying the literary art of foreshadowing, the Court began its Opinion with: “In the seventy-plus years since Congress created the Food and Drug Administration, the FDA has never before sought to enjoin a state-licensed pharmacist from engaging in the traditional practice of bulk compounding of animal drugs. Here, the FDA seeks just such an injunction. This case of first impression implicates matters of statutory construction, federalism, and the proper deference to be afforded to the FDA in interpreting its enabling statute.”16
The vast majority of the Opinion goes into long, rather esoteric, and tedious doctrines of statutory construction elucidating the regulatory powers of the FDA as delegated by Congress and limitations of those powers as claimed by the FDA as well as a review of Supreme Court cases addressing the relevant facts and laws. Another part of the Opinion documents the long history of traditional pharmacy compounding, the efforts of the FDA since the early 1990s to stop pharmacies from compounding altogether, the cases that the FDA has won and lost on that issue, the fairly intense animosity generated between the FDA and compounding pharmacies, and the compromises that both sides have crafted to accomplish the scope of acceptable pharmacy compounding practices.17
Among the more interesting historic battles between compounders and the FDA is the demonstrable “effusive” attitude of the FDA towards traditional pharmacy compounding, evidenced by multiple versions of guidelines issued by the FDA for its own inspectors to use when evaluating whether a pharmacy is acting illegally as a manufacturer of new and unapproved drugs under the guise of compounding. In case someone wants to view the various versions of these guidelines, published originally in 1992 and amended in 1996 followed by revisions in 2002 and 2003, they can be found online.18 The Court took special interest in the 2003 revision, which according to the FDA, was issued “to ensure the consistency of its policies with regard to compounding of drugs intended for use in humans and in animals.” The Court observed, “From the outset, however, the 2003 guide strikes a decidedly more hostile tone toward compounding than its human drug counterpart (as well as its 1996 predecessor).” Quoting from the 2003 guideline, the Opinion stated: “There is a potential for causing harm to public health and to animals when drug products are compounded, distributed, and used in the absence of adequate and well-controlled safety and effectiveness data or adherence to the principles of contemporary pharmaceutical chemistry and current good manufacturing practices. Use of compounded drugs in animals can result in adverse reactions and animal deaths.”19
Here the Court noted that the FDA no longer “makes a distinction between food and nonfood-producing animals” and “contains no discussion about permitted compounding practices.” The Court also noted that the FDA failed to hold open public hearings or invite comments prior to issuing this “hostile” guideline in violation of its own regulations.20 This failure irked more than 70 members of Congress enough to write separate letters to the FDA questioning why the Agency was going after pharmacists who compounded veterinary products and complaining that it was “disconcerting that the guide was put into effect without the opportunity for public review.” These members of Congress asked the FDA to withdraw the guide and ask for public input before reissuing another guide. The FDA wrote back to it’s congressional critics that it would do exactly as requested. Curiously though, the FDA never followed through.
In 2005, 98 members of Congress wrote letters complaining that the FDA had failed to deliver as promised. Specifically, the congressional letters stated: “The Agency’s failure to follow through on these commitments has serious consequences. While FDA has had more than ample time to act on its assurances to revise the CPGs [Compliance Policy Guides], their failed promises to reissue these documents represents a significant threat to vulnerable patient populations, both humans and animals, served by compounding pharmacies. Patients are continually threatened with not being able to receive crucial, life-giving medications only available from compounding pharmacies. In addition, pharmacists are being forced to operate under flawed policy, potentially jeopardizing their livelihood and reputation in order to meet patients’ essential medication needs [emphasis as quoted in original Opinion]. Further, the FDA has substantially increased inspection and enforcement activities against compounding pharmacies in the last year, premised on the very documents that the Agency acknowledges as flawed.”21
While it is probably an ill-advised strategy to thumb the Agency’s collective noses at Congress, the reality is that the FDA has not, to this day, issued any further statements on the subject. Apparently, the FDA has gotten away from any congressional oversight, as there has not been any further reaction to this “shot over the bow.”
Returning to the central dispute pending in this lawsuit, the Court noted that in essence the only issue it was being asked to decide is whether the FDCA “provides the FDA with statutory authority to enjoin Franck’s from engaging in traditional compounding of animal drugs from bulk.” That issue could only be determined by examination of congressional intent when it enacted the FDCA and its amendments. Statutory construction is one of the more difficult if not ambiguous challenges a judge faces when trying to determine congressional objectives. Nonetheless, there are well-crafted tools that provide a semblance of direction. One of those is often referred to as “the elephant in the mousehole” doctrine.22 In simple terms, the phrase is used to mean that Congress would not attempt to confer broad regulatory powers to an agency by hiding this provision in a small, obscure detail. Applying that doctrine, the Court noted, “Every Court that has addressed the issue—no matter what the context—has recognized that the FDA new drug approval process is an ‘especially poor fit’ for regulating traditional pharmacy compounding, one that would potentially eradicate traditional compounding despite the recognized importance, historical acceptance, and decades-long state regulation of the practice.”23
Furthermore, the judge wrote, “[I]t would not make sense to require compounded drugs created to meet the unique needs of individual patients to undergo the testing required for the new drug approval process [because] requiring such testing would force pharmacists to stop providing compounded drugs” [emphasis in original Opinion]. Based on this observation, the judge concluded, “...this Court cannot find that Congress has ‘directly and plainly’ said that traditional pharmacy compounding of animal drugs must meet the requirements of the FDCA’s new drug approval provisions.” Thus, the Court ordered that the FDA is not entitled to the injunction it sought and that the case against Franck’s be dismissed.24
This is a Federal District Court decision and is therefore appealable to the Circuit Court of Appeals. At the time of publication, there has not been any indication as to whether the FDA will take this step. History suggests that it probably will and that further opinions are likely to be issued in support or reversal of the District Court’s Opinion. Despite that possibility, this decision marks a clear victory for pharmacy compounding. While the focus of the case was on nonfood-producing animals, the flavor of the Opinion also implies that the numerous attempts by the FDA to stop pharmacists from compounding human drugs is misdirected. Pharmacists should take note of the existing FDA guides on compounding and do their best to comply. But when a person or an animal is in need of medication that is not commercially available, pharmacists should not hesitate to serve the patient if compounding is necessary to achieve medication management.
1. Vivian JC. The sorcerer’s apprentice. US Pharm. 2008;33(5):70-74. www.uspharmacist.com/content/
2. Vivian JC. Access to experimental drugs. US Pharm. 2008;33(3):78-80. www.uspharmacist.com/content/
3. Vivian JC. The FDA mandate: never give up, never. US Pharm. 2006;31(11):84-88. www.uspharmacist.com/content/
4. U.S. v. Franck’s Lab, Inc., Slip Op No. 5:1-cv-147-Oc-32TBS, September 12, 2011. http://docs.justia.com/cases/
5. Nieves F. Biodyl blamed in polo horses’ deaths. Cleveland Live, Inc. April 22, 2009. www.cleveland.com/world/index.
6. Kroll DJ. Biodyl, Franck’s Pharmacy, and Florida polo horse deaths: guaranteed it’s the decimal point. Terra Sigillata. April 24, 2009. http://scienceblogs.com/
October 13, 2011.
7. See Note 4, supra.
8. See Note 4, supra.
9. 21 CFR § 207.3(a)(4).
10. See Note 4, supra.
11. 21 USC § 374.
12. Rios M. FDA begins enforcing deadlines on Form 483 responses. PharmTech Talk. September 15, 2009. http://blog.pharmtech.com/
13. Guidance for Industry. Formal Dispute Resolution: Scientific and Technical Issues Related to Pharmaceutical CGMP. Rockville, MD: FDA; January 2006. www.fda.gov/downloads/Drugs/
14. 21 USC § 322(a).
15. See Note 4, supra.
16. See Note 4, supra.
17. See Note 4, supra.
18. Riley RJ. The regulation of pharmaceutical compounding and the determination of need: balancing access and autonomy with patient safety. LEDA at Harvard Law School. April 2004. http://leda.law.harvard.edu/
19. Guidance for FDA Staff and Industry. Compliance Policy Guides Manual. Sec. 608.400. Compounding for Drugs for Use in Animals. Rockville, MD: FDA; July 2003. www.fda.gov/OHRMS/DOCKETS/
20. 21 CFR § 101.15.
21. See Note 4, supra. Quoted in the Opinion from a letter from Congressmen Charles Bass and Mike Ross to Dr. Lester M. Crawford, Acting Commissioner, FDA (June 29, 2005).
22. Vivian JC. Hiding elephants in mouseholes. US Pharm. 2006;31(12):60-71. www.uspharmacist.com/content/
23. See Note 4, supra.
24. See Note 4, supra.
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