A Dangerous Idea: Two Drug Manufacturing Pathways–One Regulated, One Not
Redefining “Special Medical Needs Compounding” to Permit Mass Production Threatens Consumer Protections
Today, May 22, 2025, is the last day that mass compounded GLP-1 obesity medicines can be sold because FDA has declared the shortage over. Yet, some companies intend to continue selling compounded GLP-1 drugs to a large number of their customers by gratuitously adding other ingredients or making similar modest and unnecessary changes in dosing…then saying it is being compounded for the special medical needs of a specific patient. The hypocrisy is clear: a special medical need is not a mass need.
What happens next is about consumer protections and manufacturing standards under the Food Drug and Cosmetics Act (FDCA). FDA can enforce the law or allow a race to the bottom that ultimately robs consumers of protections they need and deprives companies of the standards that assure a level playing field and quality products.
If this were just about a class of products, I would probably not write about it in FDA Matters. However, the stakes are much, much higher than that.
If a compounder can mass produce any drug they want by claiming special medical needs for individuals --with minimal regulatory requirements and oversight--then we have enabled an alternative pathway for the manufacturing and sale of both prescription and generic drug products. Manufacturers would be regulated. Mass production compounders would not. That doesn’t sound good for consumers or innovators…and it really isn’t[1] (see important footnote).
The Current System Works and It Protects Consumers
There are over 20,000 pharmaceutical drug products that are FDA-approved in the US[2]. Most pharmacies will carry several thousand of those, depending on store volume. What a pharmacy does not already have in stock, it can usually fill within 2 or 3 days from a central warehouse.
This is a system that works, fulfilling essentially all patient needs in the US through more than 60,000 pharmacies nationwide. FDA-approved drugs dispensed through pharmacies are FDA-evaluated and approved, and have uniform quality and formulation. They are standardized and manufactured by companies that follow FDA guidance on Current Good Manufacturing Procedures (cGMP) in facilities subject to FDA inspection. They are proven to be safe and effective.
Compounding Addresses Shortages and the Special Medical Needs of a Specific Patient
By its nature, compounding by-passes the entirety of this process and the comprehensive consumer protections built into the Food Drug and Cosmetics Act (FDCA). Not only is the compounded product unregulated, but it can be given to patients without even so much as FDA-approved labeling. For good reason, compounding of commercially available drug products is only permitted under certain well-defined and limited circumstances.
In addition to shortage situations, compounding is permitted to address the special medical needs of a specific patient.
Such compounding is triggered by a specific doctor determining that a specific patient’s special medical needs require a compounded product, dosage, or method of delivery that will make a “significant difference” for the patient compared to an available commercial product. A wide variety of circumstances might be involved; examples might be a child who cannot tolerate a bad tasting oral medicine or a person with a swallowing disorder who needs a different dosage form than what is being marketed.
Special Medical Needs of a Specific Patient Is Inconsistent with Mass Compounding
I am told there is no clinical evidence supporting delivery of GLP-1’s other than the current approved FDA labeling. For example, why mix vitamin B3 or B12 into the GLP-1 compounded product other than to be able to claim it is different? Or why allow oral, sublingual, or patch methods of delivery--except on an individual basis--since no such product has yet been considered or approved by FDA? If and when FDA approves any of those routes of administrations, there will be a commercial-available product that should preclude mass compounding (while leaving the special medical needs exemption in place for legitimate individual patients).
There may be some limited cases where modifying GLP-1’s makes sense, but only if it truly addresses a specific patient’s special medical needs and not as a stratagem to support mass production.
You don’t hear much about this type of compounding because it is limited to a specific patient’s special medical needs relative to commercially-available product. Pertinently, special medical needs compounded products cannot be produced beforehand or in quantity--the exemption is justified by its application to an individual patient’s needs[3].
However, you will start hearing a lot about this type of compounding if FDA allows “special medical needs” and “significant difference” and “mass compounding” to be defined by compounders. Then the race will be on to find other lucrative drugs that can be retrofitted into the GLP-1 compounding model[4][5].,
Conclusions
It would seem self-evident that an exemption permitting compounding for the special medical needs of an individual patient is incompatible with mass compounding. Special medical needs compounding was never intended to be a place for shortage-driven mass compounding to move after the shortage has concluded.
It is like trying to pull an elephant through a mousehole. If you make the hole big enough to accommodate the elephant, it is no longer a mousehole.
FDA urgently needs to address the permissible scope of special needs compounding or risk the creation of an alternative pharmaceutical market that operates outside the safeguards and consumer protections provided by the Food Drug and Cosmetics Act.
In addition to the risk of FDA losing its ability to protect consumers by setting and enforcing manufacturing standards for drug products, there is a significant market competition risk. Paraphrasing Gresham’s Law that bad money always drives out good money[6]:
If there are two forms of pharmaceutical products in circulation, both of which are accepted by regulatory authorities as validly marketed, then the more valuable product (the one that is FDA-approved) will gradually disappear from the market.
[1] Note: there are two very important issues not addressed here: whether the compounded products work as well and are as safe as the manufactured ones, and ownership of the intellectual property.
[2] FDA Facts at a Glance. November 2020. https://www.fda.gov/media/143704/download
[3] The risk-benefit of going outside the proven and approved labeling is acceptable for a single person with genuine special medical needs that cannot be met by a commercially-available product.
[4] As previously noted, this analysis does not address whether the compounded products are as safe and effective as the manufactured one. FDA must have some inkling that they are not: In May 2025, FDA disclosed plans for an extensive survey of compounding pharmacies, in part because “FDA continues to find concerning quality and safety problems during inspections of outsourcing facilities.” https://public-inspection.federalregister.gov/2025-07557.pdf
[5] As previously noted, this analysis does not address intellectual property rights, which are a significant issue all by itself.
[6] Application of Gresham’s Law is not always intuitive. If enough readers would like a further explanation, I will do a follow-up column. https://en.wikipedia.org/wiki/Gresham%27s_law.