FDA Inspections

Over the past few years, many compound pharmacies were subjected to aggressive action by the FDA. As a result of the fungal meningitis epidural case, the FDA declared that it “intends to continue proactive and for-cause inspections of compounding pharmacies, and [] plans to take aggressive action, including enforcement actions.”

Given the FDA’s warning and enforcement powers, compound pharmacies, outsourcing facilities and drug manufacturers, should consider retaining an attorney to assist with FDA inspections. First, the FDA is an enforcement agency that has the power to bring enforcement action, including criminal prosecution (via the DOJ). Second, many inspections are conducted after receipt of a complaint or adverse event report. In these cases, the FDA is determined to find evidence of violations and may ask questions intended to draw-out admissions of non-compliance. Third, the FDA is often accompanied by investigators from the state Board of Pharmacy who have the power to discipline, even where the FDA does not. Therefore, we strongly recommend that compound pharmacies and drug manufactures facing FDA inspection, contact our attorneys immediately. Our attorneys can help demonstrate to the FDA that your pharmacy or facility is compliant, can respond to investigators’ questions and address subsequent action for deficiencies/violations.

Who Is Subject to FDA Inspections?

Compound pharmacies are subject to FDA inspections, however, the standard for inspection differs depending on whether they are registered as an outsourcing facility (“503B”) or meet the 503A exemption from drug manufacturing regulations.

Compound pharmacies who compound for an identified individual patient and dispense upon receipt of a patient-specific prescription, are exempt from FDA registration, compliance with current Good Manufacturing Practices (CGMP), and labeling requirements, so long as they meet the 503A exemption requirement. Generally, the FDA has limited interaction with these pharmacies; however, they will inspect these pharmacies if they receive a complaint or believe the pharmacy does not meet the 503A exemption.

Compound pharmacies registered as 503B outsourcing facilities are subject to FDA inspection on a risk-based schedule. Unlike 503A compounding pharmacies, these pharmacies must comply with cGMP regulations.

While compound pharmacies (not registered as outsourcing facilities) are exempt from CGMP regulations, this exemption rests on whether they can support each compound drug with a proper prescription for a specific patient. Compound pharmacies who fail to show the FDA investigator supporting prescriptions, will not be able to claim a 503A exemption, and will therefore be required to comply with CGMP and other regulations required of drug manufacturers. Many compound pharmacies who believed they were exempted from CGMP, found themselves subject to discipline and enforcement action for non-compliance because their prescriptions did not meet the 503A exemption. Common reasons for prescriptions failing the 503A exemption include:

  • Compounding and dispensing without receipt of a prescription
  • Compounding and dispensing without receipt of a prescription that identifies a specific patient
  • Compounding before receipt of a prescription when there is no pharmacists-physician relationship for orders regarding a specific patient
  • Compounds that deviate from the prescribed drug
  • drugs made in bulk without a prescription
  • Compounding regular or inordinate amounts of drugs that are commercially available (compound pharmacies)
  • Compounding commercially available products (outsourcing facilities)
  • Compounding drugs that have been removed or withdrawn from the market by the FDA

Additionally, all compound pharmacies and manufacturers, regardless of 503A exemption status, are subject to FDA regulations regarding sanitary conditions and contamination. Several compound pharmacies and manufacturers have found themselves subject to enforcement action, including criminal action, for manufacturing contaminated drugs.

FDA Inspections

The FDA has authority to inspect manufacturers and outsourcing facilities who have registered with the FDA. They can inspect compound pharmacies; however, inspections are limited to ensuring pharmacies have meet the 503A exemption, review of sterile practices and for-cause inspections after receipt of a complaint.

The FDA usually does not announce for-cause inspections; however, they may pre-announce routine compliance inspections to ensure management and records will be present during the inspection. If the FDA arrives for an unannounced inspection, or attempts to arrange a pre-announced inspection, we strongly advise you contact our attorneys and arrange to have counsel present during the inspection. While the FDA may threaten criminal prosecution upon any person who attempts to refuse or delay an authorized inspection, our attorneys may be able to work with the FDA to delay the inspection until an attorney has arrived without you being found to have refused or delayed the inspection.

Warrants and Consent to Inspect

To inspect a facility, the FDA needs consent, a FDA Form 482, or an administrative warrant (also called an inspection warrant). If a search warrant is presented, the FDA is likely seeking to seize evidence of criminal wrongdoing. Likewise, if the FDA is accompanied by law enforcement, the facility is likely suspected of criminal violations.

What The FDA Can Inspect

There are statutory limitations on what the FDA can inspect, copy and collect. Generally, they can review and copy records related to adulterated, misbranded, or other alleged violations of the FD&C Act. However, they cannot review financial, sales, personnel and research data. The FDA may also photograph the facility to document compliance. If the FDA collects samples, they will need to issue a Form-484 which identifies the samples collected. If onsite, our attorneys will help ensure that the FDA does not exceed the scope of search authorized by statute or warrant. Additionally, our attorneys will help ensure that copies of records and duplicate samples of collected samples are retained in case of later discrepancies or enforcement action.

Deficiencies (FDA Form-483)

Upon completion of an FDA inspection, the investigator will issue an FDA Form-483, which outlines deficiencies found by the investigator. These deficiencies are objectionable and should be addressed before final action is taken by the FDA. Pharmacies may be able to reduce the chance of enforcement action and/or discipline by promptly submitting a corrective action plan to the FDA. We advise that pharmacies contact our attorneys for assistance in preparing corrective action plans and communicating with the FDA during an open investigation. Often, pharmacies respond by defending their actions, rather than directly addressing the FDA’s concerns and may fail to provide the FDA with evidence of compliance. In these cases, the FDA may find their response insufficient and move to take further action.

Common Deficiencies:

  • Improper sterilization practices
    • Inappropriate gowning of operators
    • Inadequate cleaning and disinfectant practices
    • inappropriate air quality, humidity and pressure and lack of air sampling logs
  • Insufficient product testing for potency or microbials
  • Inadequacy or improper sterilization of containers
  • Improper temperature of incubators or insufficient temperature logs
  • Inadequate drug product batch failure investigations
  • Insufficient prescription records for compound drugs

FDA Warning Letters

The FDA has discretion to issue a warning letter. The warning letter is an informal advisory action that aims to bring prompt voluntary compliance with FDA regulations. While a warning letter is generally issued prior to enforcement action, the FDA can bring enforcement action concurrent with issuance of the warning letter. Also, a warning letter is not a prerequisite to enforcement action. Warning letters are often an opportunity to correct compliance issues and avoid enforcement action. Therefore, they should be taken seriously and dealt with promptly. We advise you seek assistance from our attorneys to help prepare your response to a warning letter. A prompt response that adequately demonstrates voluntary compliance may be sufficient to prevent further action.

If the FDA does not receive a response, or the response is found to be inadequate, the FDA may move to take corrective action to correct the alleged violations.

Injunctions and Temporary Restraining Orders

In cases where significant violations have been found, the FDA will quickly seek an injunction or temporary restraining order from the Federal Court. Injunctions are issued to control significant compliance issues that cause health hazards, gross consumer deception, or where seizure and/or voluntary recall have been or will be insufficient to protect the public, or for longstanding violations that have not been corrected after other efforts. Temporary restraining orders are reserved for severe cases, such as conditions that pose a public health risk or cases involving companies that serve a significant portion of industry. If the FDA discovers significant violations, they will immediately compile evidence from the inspection, collect statements from investigators, obtain an expert report and forward to the DOJ, who will seek to have a Federal Court Judge enter a TRO or injunction. Once a TRO or injunction has been granted, the FDA will monitor the firm for compliance. If the firm violates an injunction or TRO, the FDA may seek criminal or civil contempt of court action, and/or regulatory actions.

There is a very short timeframe in which you can respond to these orders. Therefore, firms who receive a TRO or injunction should contact an attorney immediately to resolve the issue before it has a detrimental effect on the business, and/or leads to criminal prosecution.

FDA Enforcement Actions:

The FDA may also take additional action, concurrent with a TRO or injunction, such as:

  • Warning letters
  • Recalls and market withdrawals
  • Injunctions
  • Temporary Restraining Orders (TROs)
  • Suspension of part or all of the pharmacies operations
  • Civil Monetary Penalties (CMP)
  • Seizure of products in violation of regulations
  • Administrative detention of drugs
  • Criminal prosecutions for fraud, adulteration of drugs, misbranded drugs, counterfeit drugs, falsely labeling drugs, illegal promotion of drugs, falsely documenting drug studies, drug diversion, faulty surgical devices, etc.)
  • License revocation

Our Experience

If you are aware of a FDA investigation, subject to a FDA inspection or are facing enforcement action by the FDA, you should contact our attorneys immediately. Chapman Law Group is dedicated to representing health professionals and corporations within the health care industry. Our attorneys specialize in regulatory compliance, licensure, malpractice, fraud and abuse and criminal prosecution of health care matters. Additionally, our attorneys are experienced with both state and federal regulatory and licensure matters and understand the interplay between the various agencies. We frequently represent health professionals with matters before the state Boards, DEA, CMS, criminal courts and FDA.


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