Avoiding medication compounding liability

Compounding can offer valuable benefits for patients, including the ability to provide medications during shortages. For example, compounding recently drew wide attention when shortages of GLP-1 receptor agonists approved by the Food and Drug Administration (FDA) occurred.

However, if not correctly prepared, compounded medications can cause serious harm. To protect patients and minimize legal liability, pharmacists must understand the risks and benefits of compounding, whether they compound drugs themselves or obtain compounded drugs from other sources.
 

Overview of compounding

Compounding may be used in several situations, including:

• Personalized therapy (for example, when a patient has an allergy to a dye, so requires a medication made without it).
• An older patient or child who cannot swallow tablets needs the medicine in liquid form.
• A drug shortage exists (Note: The drug must be on the FDA drug shortage list).

Compounding can be performed by a licensed pharmacist in a state-licensed pharmacy, a federal facility, or by a physician. Compounding can also occur under the direct supervision of a licensed pharmacist in an outsourcing facility. Facilities that register as compounding outsourcing facilities are inspected by the FDA; oversight of state-licensed pharmacies is typically the responsibility of the state boards of pharmacy.

Pharmacists should know that the Drug Quality and Security Act (DQSA) addresses compounding under 503A (licensed pharmacies) and 503B (outsourcing facilities).
 

Risks of compounding

The benefits of compounding come with risks. Quality issues can lead to problems, such as potency variability and contamination. A study by Watson and colleagues found that contamination and concentration errors were the most common, and that many patients were harmed.

GLP-1 agonists provide a recent example of potential risks. The FDA has identified several issues with compounded versions; for instance, the use of salt forms of semaglutide, which differ from the active ingredients in the approved drugs.

In addition, although the FDA has declared that the shortage of these drugs is over, some companies are making minor changes, stating the compounded versions are “personalized” when they are not. The active pharmaceutical ingredients in compounded drugs must come only from entities registered with the FDA. Still, some companies are using products from outside the United States from facilities that have not been inspected.

Another commonly cited example of a compounding issue is the 2012 New England Compounding Center incident. More than 793 patients were diagnosed with fungal meningitis after receiving injections of preservative-free methylprednisolone acetate; of those, more than 100 died. Many were found to be at fault, and in 2019, two pharmacists were sentenced for their actions. This event led to DQSA.

Pharmacists face several liability risks related to compounding. Compounded drugs are not approved by the FDA, so malpractice claims could arise if they are prescribed or dispensed incorrectly. In addition, the chain of liability means that a pharmacist is not exempt from liability if a compounded drug from an outsourced facility causes harm. The prescriber, pharmacist, and outsourcing facility could all be held liable.

The cost of being found liable can be high: In 2025, a pharmacy was fined $1 million for compounding injectable weight-loss drugs in unlicensed facilities.

To reduce risks, pharmacists must compound safely and carefully select outsourced facilities. Pharmacists should also have liability coverage that includes compounding if they plan to engage in this task.
 

Compounding safely

Pharmacists need to complete training related to compounding and ensure technicians are also trained in compounding, with proper preparation and certification. Drug compounding certification involves completing specific educational programs and exams, with options for both non-sterile and sterile compounding.

The Board of Pharmacy Specialists offers the Compounded Sterile Preparations Pharmacy Specialty Certification (https://bpsweb.org/compounded-sterile-preparations-pharmacy/) for pharmacists who perform compounding of sterile preparations and oversee the compounding process.

Certifications for technicians include the Certified Compounded Sterile Preparation Technician^® (CSPT^®) and the Nonsterile Compounding Certificate, both from the Pharmacy Technician Certification Board (https://ptcb.org/).

Other organizations, such as the American Society of Health-System Pharmacists (ASHP) and the American College of Apothecaries, offer certificate programs for pharmacists and technicians that may include hands-on training and exams. These are often based on quality standards from the United States Pharmacopeia (USP), which compounders must adhere to.

The USP standards include nonsterile preparations (Chapter 795) and sterile preparations (Chapter 797). Another important chapter is the one on the safe handling of hazardous drugs (Chapter 800). Pharmacists should also follow guidelines from national associations such as ASHP and the American Pharmacists Association.

Here are additional strategies pharmacists can use to ensure safe compounding and reduce their risk of liability.

• Use high-quality ingredients, label preparations clearly (including key information such as the drug name and dosage), and document accurately. Follow storage guidelines and verify medications that have been prepared before sending them to patients.
• Research outsourced facilities before using them. Ensure the chosen facility follows Good Manufacturing Practices and verify whether it is registered with the FDA.  Also check when the last inspection was done.
• Check for alerts related to compounded products. The alerts are issued by the FDA and can be accessed at https://www.fda.gov/drugs/human-drug-compounding/compounding-risk-alerts.
• Report adverse events and quality deficits related to compounded drugs to the FDA.

Ongoing education is also key. USP has numerous resources, including preparation monographs for specific drugs. ASHP also offers many resources, including the Compounding Competency Assessment Center, which helps develop the skills necessary to comply with USP Standards for pharmacy and non-pharmacy personnel involved in compounding.

Pharmacists should also provide and document education to patients about why a compounded drug is needed and its associated risks and benefits. It is advisable to obtain informed consent from the patient to ensure there is documented agreement to receive the compounded product. Patients should also be educated on topics such as administration and potential adverse events. General education about compounding is essential as well because patients sometimes purchase compounded products online without understanding the associated risks.
 

Protecting patients and pharmacists

Compounding can benefit patients, but it must be done by qualified personnel in quality facilities. Pharmacists should adhere to standards when compounding, ensure that both they and the technicians they work with have the necessary training, and conduct due diligence when choosing a compounding facility. This approach will help protect patients and reduce the risk of pharmacist liability.
 

Cynthia Saver, MS, RN, of CLS Development, is a medical writer in Columbia, Md.

Sidebar #1

Nurse practitioners and compounding

As noted in this article, prescribers can be held liable for adverse reactions arising from compounded medications that are not approved by the FDA. Therefore, nurse practitioners should use caution when prescribing them.

Kircik and Siegel recommend prescribers ask three questions before prescribing a compounded drug:

• Is there a commercially available product that meets the needs addressed by a compounded formulation?
• Are all of the items in the compounded formulation FDA-approved?
• Is the facility that will be performing the compounding registered with the FDA and fully compliant with its guidelines?

Remember that a compounded drug cannot be a copy of a commercially available drug. In addition, the FDA does not allow compounding if an existing product will “reasonably” meet the patient’s need. Therefore, compounding as a way to reduce cost is not valid. Instead, patients must require customization for a particular reason, as noted in the article.

Source: Kircik L, Siegel DM. Clinical and legal considerations in pharmaceutical compounding. J Clin Aesthet Dermatol. 2023;16(8 Suppl 1):S23-S28.

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