Pharmacy – Relying on 503Bs is a mistake

What’s a 503B FDA outsourcing facility? Well, just sit right back and you’ll hear a tale, a tale of a fateful trip, that started from this tropic port, aboard this tiny ship…. just kidding, it’s what popped into my head when I started writing, but we really should define what a 503B is.

The 503B moniker is a designation created by the FDA that establishes a middle ground between manufacturers and facility-level compounding. In short, 503Bs are pharmacies that can “manufacture” compounded medications and sell them to other entities, like hospitals. Unlike hospital pharmacies, designated 503A pharmacies, 503Bs must comply with strict CGMP – current good manufacturing practices – which are the same standards that pharmaceutical manufacturers are held. Because 503Bs use CGMP and conduct lots of sterility and stability testing, they’re allowed to assign extended beyond-use-dates (BUDs) to products. It’s a tough gig to be sure, no one wants to be beholden to the douchebags at the FDA. More information on 503Bs can be found here.

In general, 503Bs were born out of the crazy overregulation of pharmacy IV rooms. The adoption of USP General Chapter <797> by Boards of Pharmacy throughout the land created a void for most pharmacies that could not easily be filled. Unlike in the heyday of pharmacy practice, when pharmacists made sound, logical decisions based on science, education, and experience, the current landscape dictates when and how something can be made, its storage conditions, and ultimately how long it can be held prior to use. Before USP <797>, it was customary practice to compound “batches” of frequently used medications and store them for future use, whether that be a week or a month down the road. It was the lifeblood of many pharmacies as it gave them control of their own resources. During downtimes, staff would batch in anticipation of times when things were so busy you couldn’t take a piss. With adoption of USP guidelines as best practice, this all went away. Compounding on demand, with some low volume “anticipatory compounding”, became the norm.* It’s quite inefficient compared to older, better practices.

The issue above created a hole in the pharmacy supply chain that gave rise to 503Bs. It’s a service that no one asked for but became unavoidable for many. Don’t get me wrong, 503Bs have been of great benefit to many healthcare systems. They provide a vital service between pharmaceutical manufacturing and facility-level compounding. There are hospitals out there that would find it difficult to survive without 503Bs. On-demand compounding with small anticipatory batches is always preferred, but not always possible. Everybody needs help sometimes.

However, 503Bs are not perfect, and their shortcomings were amplified during peak pandemic. In general, one would have a need, place an order, and receive drug. But we all know that the pharmacy supply doesn’t always work this way. In fact, it’s all too common to have a need, place an order, and then sit around wondering what happened to the drugs that were supposed to be sitting in your receiving area. Things can get messy in a hurry. Think for a moment about when 503Bs are needed most. It’s when demand is high and pharmacies are running at peak capacity. Unfortunately, it’s during these times of critical need when 503Bs become a liability.  

In short, here are the reasons why using 503Bs is a mistake:

  1. Expensive – You pay for the convenience of purchasing products made by someone else. They have to pay for labor, testing, and infrastructure somehow. I don’t begrudge them their profit, but it has to come out of someone else’s pocket. For large facilities, this can easily add up to a number north of a million dollars per year. A million dollars isn’t exactly earth shattering for facilities with budgets in the multiple hundreds of millions of dollars, but it’s worth a moments consideration.
  2. Shortages, demands, delays – 503Bs suffer from the inability to spin up production during times of extreme need. Rest assured, when one pharmacy has increased need for a certain drug, they all do. This obviously creates issues with supply chain, and nowhere is this more evident than with 503Bs. It’s bit me on the rear more than once.
  3. Quality control issues – Unfortunately, 503Bs are subject to the same quality control issues that are found in many pharmacy IV rooms. One small error can force the destruction of an entire batch, which may represent orders for many pharmacies. Whoops, get ready for an Excedrin-sized headache.
  4. Customer support – My limited dealings with 503Bs has resulted in me wanting to deal with them even less. I’ve found customer support at 503B companies to be lacking, to put it kindly.**

In the end, it is at one’s own peril that they rely on 503Bs to provide a steady stream of products. They seem to let pharmacies down when they are needed the most. After much thought, I think it’s time for pharmacies to take back control of their compounded medication production. While not the easiest thing to do, USP guidelines – and by extension most regulatory agencies – do allow pharmacies to produce limited quantities of compounded products in anticipation of need. Given the potential expense of using 503Bs, it seems logical that one could find enough in cost savings to build out a new service line. This is especially true for facilities large enough to require such a service in the first place.  

And that brings us to robotics, which is a blog for another time.

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*one may technically compound large batches at the facility level, but it is limited by two factors: 1) it requires extensive testing that is time consuming and expensive, and 2) regulatory agencies like the CA Board of Pharmacy and the California Department of Public Health (CDPH) hate it, so they tend to crawl up every orifice you have searching for a problem if you do it. It’s the type of scrutiny facilities try to avoid.

**I believe this is due to the nature of their business model, i.e. razor thin margins made up by cranking out more product.

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