How H.R. 3204 will affect most pharmacists

Practical impact of new compounding, track-and-trace legislation

President Barack Obama has signed the Drug Quality and Security Act (H.R. 3204) into law. What are the practical implications for most pharmacists of the new compounding and track-and-trace legislation?

The short answer is that the compounding part of the legislation, which became effective upon enactment, will affect very few pharmacists. The track-and-trace part of the legislation will affect all pharmacists to some extent, according to Michael Ghobrial, PharmD, JD, Twlug Associate Director of Health Policy.

Of course, the language in the legislation is not the last word. FDA has to decide how to implement it through the regulatory process. Traditional community pharmacies are “probably” not going to be affected by the compounding part of the law “unless we get more stringent regulation from the FDA,” said Lee Rosebush, PharmD, JD, MBA, MS, Counsel at the BakerHostetler law firm in Washington, DC. “While we got by with 3204, we may not necessarily get by with the regulations proposed by FDA.”

Compounding: Practical impact

Under the new law, traditional pharmacies are still regulated by state boards of pharmacy. Compounding pharmacies are still regulated by state boards of pharmacy, Ghobrial said. But now compounding pharmacies that voluntarily elect to be “outsourcing facilities” are regulated by both state boards of pharmacy and FDA.

“Here’s the big question everybody’s going to be asking: If [registration with FDA] is voluntary, why would you want to have the FDA breathing down your neck? And the answer to that is brilliant,” Ghobrial said. “People will sign up because their product is less likely to be sold if they’re not an FDA-overseen outsourcing facility.”

Traditional pharmacies that do sterile compounding based on specific, individualized prescriptions have no reason to register with FDA, emphasized Rosebush. Pharmacies that are going to supply office use medication, however, have to do the registration. “You’re going to see a business model determination,” Rosebush said. “You’re going to see entities say, ‘Well, is the $15,000 user fee and the cGMP [current Good Manufacturing Practices] compliance worth moving into this new business model?”

Rosebush has “several clients who are large compounding pharmacies,” he said. “I do have some that are willing to register with the FDA and are currently pursuing compliance policies that use cGMPs and USP [U.S. Pharmacopeia] <797> standards. We eagerly await the publication of regulations in this area.” He added, “Some of my clients do not feel that they will have to register with the FDA and are not planning on registering with the FDA.”

Many in the industry don’t think that cGMPs (which are aimed at manufacturers) will be applied across the board to compounding pharmacies, according to Rosebush. “They can’t do it. It’s impossible,” he said. “I think you’ll see some new cGMPs put forth for compounding pharmacies, and I think those cGMPs will adopt certain aspects of <797>.”

Track-and-trace: Practical impact

“Track and trace affects all pharmacists, but it’s really not that difficult,” Ghobrial said. As of January 1, 2015, the manufacturers and the wholesale distributors “can’t ship anything out unless it has a transaction history” in the form of paper documentation for each individual unit of a drug; if there’s a hiccup or if, say, the paperwork gets lost somehow, pharmacies can still accept the product until July 1, 2015. Starting on that date, following the 6-month grace period, pharmacists have to reject products without an accompanying transaction history.

When pharmacists get the product in from the distributor, they need to take the transaction history paperwork, put it in a drawer, and keep it for 6 years.

Along the same lines, one pharmacy can transfer a drug to another pharmacy to fulfill a specific patient need without needing an accompanying transaction history—but if a pharmacy just wants to lessen their inventory because there’s too much money on their shelves, as of July 1, 2015, the drugs need to be sent back to the distributor with a transaction history. “Say they do want to lighten their inventory a year later,” Ghobrial said. “They go back into their drawer, pull out the transaction history, maybe write a line item saying it was at my pharmacy on such-and-such a date, and they can ship it. So it’s not like they have to do all this investigation and research. All the information should be in their drawer.”

As of the bill being signed, the pharmacist is required to investigate a product that he or she finds to be suspicious, quarantine it, dispose of it, and give appropriate notice to FDA. But FDA has 7 years to implement regulations for exactly what pharmacists should do in a rigorous investigation process, Ghobrial continued. “After you do all the transaction history, have all the documents where you transfer ownership, make sure that you receive the drug with the proper documentation, store the documentation away for 6 years—[the next step] is to investigate” suspicious drugs (drugs that are counterfeit, tampered, or adultered).

“My read is that the duty begins when” pharmacists see a suspicious product,” Ghobrial said. “The duty’s not to find it. The duty is to set it aside once they do find it, and the FDA.”

Also through FDA rulemaking, in 10 years, track and trace will be implemented electronically with technology that is not specified in the law—but which could be bar codes and/or RFID (radio-frequency identification), for example. “You have to assume that not all pharmacies have a scanner and the software and the hardware to visualize what would be in the bar code,” Ghobrial said. “In 10 years, I think that’s what they’d want to do.”

The intent of Congress was that the track-and-trace legislation will curb counterfeit drugs entering the supply chain, Ghobrial said. The new law will not “stop all diversion,” Rosebush said. But “it’s a good step moving forward.”