Compounders Confounded

A lawsuit filed by the Outsourcing Facilities Association and Texas-based North American Custom Laboratories LLC, trading as FarmaKeio Custom Compounding, has challenged the FDA's decision to remove the diabetes and obesity drug tirzepatide from the drug shortage list. The plaintiffs argue the FDA acted recklessly, even “depriving patients” of access to a compounded drug without following proper notice-and-comment procedures. They claim the FDA's decision benefits manufacturers at the public’s expense, among ongoing shortages. The lawsuit seeks to overturn the FDA’s ruling and restore the availability of Tirzepatide without mentioning specific pharmaceutical manufacturers. The complaint states that the FDA's “failure to address this issue reflects lack of reasoned decision-making and recklessness as to the true state of supply and demand in the market.”

The FDA, which has not yet issued a response to this complaint, published a warning back in 2022 for patients to not use any intended-to-be-sterile FarmaKeio products. Following an inspection of facilities operated by North American Custom Laboratories/FarmaKeio, FDA officials “observed conditions that could cause the drugs produced by the company to become contaminated or otherwise pose risks to patients.” The compounding group complied with the FDA request at this point by issuing a voluntary recall on all such products.

But why the bad blood now? Compounding is viewed across the industry as a means of making high-demand drugs go a bit further, particularly during shortages. With Tirzepatide no longer considered in short supply, the ability of compounders to manufacture and market it is restricted, thereby returning the market share back in favor of the patent holder – in this case, Eli Lilly. In a competitive, capitalist market, the decision effectively removes FarmaKeio’s ability to compete.

Is the shortage really over or is it a temporary non-shortage? Or should we be asking whether compounders can continue to manufacture high-demand pharmaceuticals, such as GLP-1 drugs, if it helps avoid potential shortages? Though there is nothing stopping compounders from focusing on other drugs that remain on the shortage list, at least for a while, it seems that everyone wants a piece of the lucrative GLP-1 market. We await the outcomes of the case – and whether the FDA really was “reckless” in its decision making process.