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In Wake of Meningitis Outbreak, Who Will Oversee Compounding Pharmacies?

Investigations uncovered a loophole that some compounding pharmacies exploited for financial gain. Now, regulators and policymakers must decide who’s going to close it -- the feds or the states.

As of Dec. 3, 36 people in 19 states had died from the fungal meningitis outbreak linked to tainted steroids manufactured and sold by the New England Compounding Center (NECC) in Massachusetts. Another 541 had been infected. While news of the outbreak made headlines this fall, it was largely overshadowed by the election. Now regulators and policymakers want to make sure something like this never happens again. To that end, they’re focusing on the murky and heretofore overlooked area of pharmacy regulation.

Investigations into the outbreak have uncovered a loophole that some compounding pharmacies have exploited in order to make a lot more money. The challenge for regulators and policymakers is closing that loophole while deciding just who should be in charge of doing it -- the feds or the states.

To grasp the problem, one must first understand just what a compounding pharmacy is. Put simply, compounding pharmacies are charged with making individualized doses of mass-produced medication for patients with specific needs. For example, if a child has an allergy to eggs, milk or certain colorings, the compounding pharmacy can make that child an allergy-free version of a particular med. But unlike mass-market drug manufacturers that are regulated by the U.S. Food and Drug Administration (FDA), these pharmacies are only overseen by a state’s board of pharmacy. The boards don’t have the resources to inspect or hold accountable rogue firms, and the FDA doesn’t have the authority. Indeed, this was a disaster just waiting to happen.

And it happened “at a uniquely awkward time for state legislatures,” says Richard Cauchi, health program director for the National Conference of State Legislatures (NCSL). Virtually every state body was in recess when the outbreak hit in October. While there was still a flurry of pre-election activity in various places, “it’s too early to say how much state legislatures will feel they can solve this. Much of the issue is practical inspection and enforcement, and that is dependent not just on statutes and regulations but on resources to actually get out and do the evaluations. So funding is a factor.”

Another issue is that states are waiting -- and in some cases, hoping -- for the feds to step in. That’s just what U.S. Rep. Edward J. Markey of Massachusetts did. His district is home to the NECC, and he has proposed legislation to strengthen federal regulations for larger-scale compounding pharmacies while keeping the mom-and-pop stores under state oversight. This is not the first time this issue has come up at the national level. “The feds have discussed this for a number of years,” says Rachel Morgan, health committee director at NCSL. “I think that last piece of legislation was introduced in 2007. It was heavily debated but didn’t go through. Pharma lobbying was definitely a factor.” In fact, a lobbyist representing compounding pharmacies at a November hearing on the fungal meningitis outbreak told Congress that stricter federal oversight was unnecessary.

Too little oversight is certainly a problem, but Morgan also worries that new regulations might “throw the baby out with the bathwater.” A registered nurse who comes from a family of pharmacists, Morgan knows that “most [compounding pharmacists] are meticulous at this. They do what they are supposed to do, which is to create a product that accommodates the needs of a single patient. A few aren’t playing by the rules, but most are.”

Since the NECC story broke, some compounding pharmacies have been closed in Florida and Massachusetts. But ultimately, no one really knows how big the problem is or, at the moment, how to fix it. “I think the FDA needs to work closely with state pharmacy boards to ensure this remains an industry that produces safe products,” Morgan says. “It’s a very complex situation, I will say that.”

Caroline Cournoyer is GOVERNING's senior web editor.
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