Compounding pharmacies are one of the most discussed topics in healthcare right now. They are also one of the most misunderstood.
It’s a complex, highly regulated industry. That combination creates confusion. And confusion creates misinformation. As one of the leading compounding pharmacies in the country, we believe it’s our responsibility to answer the most common questions clearly and honestly.
Here are the questions we hear most.
What is a compounding pharmacy?
A compounding pharmacy prepares medications for individual patients based on a prescription from a licensed provider.
Compounded medications are prepared to meet a specific patient’s needs as determined by their prescriber. That might mean a different dose, a different dosage form, or a formulation without a specific ingredient that a patient cannot tolerate.
Compounded medications are not FDA-approved. They are prepared under FDA oversight and in compliance with state board of pharmacy regulations. A licensed healthcare provider prescribes them. A licensed pharmacist prepares them.
Compounding pharmacies like Empower prepare a wide range of medications, including sterile injectables, hormone therapies, weight management medications, dermatology treatments, and other customized formulations prescribed to meet specific patient needs.
Compounding has been part of pharmacy practice for centuries. It remains an important option for patients whose needs are not met by commercially available medications, as determined by their prescriber.
Are all compounding pharmacies part of the “Gray Market”?
No. Licensed compounding pharmacies are not part of the gray market.
The term “gray market” typically refers to products that are sold through unofficial or unauthorized channels, often outside of standard regulatory oversight. That is not how licensed compounding pharmacies operate in the United States.
Compounding pharmacies are part of the regulated healthcare system. They are licensed by state boards of pharmacy. Facilities like Empower that operate as 503B outsourcing facilities are also registered with the FDA and subject to federal inspection under current Good Manufacturing Practices (cGMP).
The confusion usually comes from the fact that compounded medications are not FDA-approved products. That is accurate, but it does not mean these compounds are unregulated or operating outside the system.
Compounded medications are prepared by licensed pharmacists based on prescriptions from licensed providers within a defined regulatory framework. They are used when a patient’s clinical needs cannot be met by a commercially available drug.
Calling compounding pharmacies a “gray market” is simply wrong. They are a regulated, legitimate part of the healthcare system focused on patient-specific care.
Are compounded medications safe?
Compounded medications prepared by properly licensed, regulated pharmacies follow quality standards designed to protect patients.
It is important to understand that compounded medications are not FDA-approved drug products. The FDA does not evaluate compounded medications for safety, effectiveness, or quality before they are dispensed.
What regulations do require is that compounding pharmacies operate under state boards of pharmacy oversight, and that 503B outsourcing facilities, like Empower, also operate under FDA oversight and cGMP requirements.
At Empower, we test every batch of medication for sterility, potency, and purity before it ships. We source ingredients exclusively from FDA-registered suppliers. Our facilities are built and maintained to pharmaceutical-grade environmental standards. We conduct environmental monitoring and personnel controls that go beyond what is required of a standard 503A pharmacy.
These practices help promote quality and safety, but every medication has some level of risk. Patients should always work closely with their healthcare provider to determine whether a compounded option is right for them.
Are compounded medications the same as generic drugs?
No. Compounded medications and generic drugs are two different things.
A generic drug is FDA-approved. Manufacturers must demonstrate that it meets the same standards as a brand-name drug before it reaches patients.
A compounded medication is prepared specifically for an individual patient, based on a prescription, in a form or dose that may not be commercially available. It is not a copy of a brand-name drug and is not an FDA-approved product.
For example, a compounded medication may involve adjusting the dose of a hormone therapy, creating a preservative-free injectable, or preparing a formulation that removes an ingredient a patient cannot tolerate—none of which are addressed by commercially available generic products.
The difference matters legally, clinically, and practically. Compounded medications should never be described as generics and responsible pharmacies do not present them that way.
Why would a doctor prescribe a compounded medication?
Healthcare providers prescribe compounded medications when a commercially available product does not meet a specific patient’s clinical needs, as determined by that provider.
There are a number of reasons a provider might determine that a compounded medication is appropriate. A patient may need a dose that is not available in a commercially manufactured product. A patient may require a different dosage form, such as a liquid instead of a tablet. A patient may have a documented intolerance to an ingredient in a commercially available formulation.
The decision to prescribe a compounded medication is always a clinical one, made by a licensed healthcare provider for a specific patient. Empower does not prescribe medications. We prepare them according to a provider’s clinical specifications within each prescription.
If you have questions about whether a compounded medication is right for you, talk to your healthcare provider.
What is a 503A pharmacy vs. a 503B outsourcing facility?
In the United States, compounding pharmacies can operate under two different regulatory frameworks established by the Drug Quality and Security Act of 2013: 503A and 503B.
A 503A pharmacy compounds medications for individual patients based on a valid prescription from a licensed healthcare provider. It is regulated primarily by state boards of pharmacy and focuses on patient-specific formulations tailored to a prescriber’s direction.
A 503B outsourcing facility is a compounding operation that has voluntarily registered with the FDA and agreed to comply with current Good Manufacturing Practices (cGMP). These are the same federal manufacturing standards that apply to traditional pharmaceutical manufacturers. 503B outsourcing facilities are subject to FDA inspection in addition to state oversight and are authorized to compound medications in bulk, with or without patient-specific prescriptions, for distribution to healthcare facilities for office use.
In practical terms, the distinction comes down to how medications are prepared and regulated.
503A pharmacies focus on individualized prescriptions for specific patients. 503B outsourcing facilities can produce medications in larger quantities and operate under a higher level of federal regulatory oversight, particularly for sterile and more complex preparations such as injectables.
Many of the sterile medications produced in 503B outsourcing facilities require this higher level of manufacturing control, environmental monitoring, and quality systems.
Fewer than 50 compounding operations in the country hold both a 503A and a 503B designation. Empower is one of them.
Holding both designations reflects a deliberate investment in distinct regulatory frameworks. It means operating a 503A pharmacy for patient-specific compounding under state oversight, while separately maintaining a 503B outsourcing facility that complies with FDA requirements and cGMP.
Is compounding pharmacy regulated?
Yes. 503A compounding pharmacies are regulated at the state level. 503B outsourcing facilities are regulated at both the state and federal level.
Compounding pharmacies are licensed and regulated by state boards of pharmacy in every state where they operate. 503B outsourcing facilities are additionally regulated by the FDA and subject to federal inspection under cGMP standards. Both operate under quality standards established by the United States Pharmacopeia (USP).
The regulatory framework for compounding is layered and varies by state, by facility type, and by the medications being produced. That complexity is part of why it is frequently mischaracterized.
Empower operates a 503A compounding pharmacy and holds pharmacy licenses across the country. We also operate an FDA-registered 503B outsourcing facility and are subject to inspection by both state regulators and federal inspectors, maintaining the quality systems and documentation those frameworks require.
Still have questions?
Browse our Knowledge Center for more on compounding pharmacy, the therapies we provide, and what to ask your provider. If you are a patient, your provider is the right starting point for any questions about whether compounded therapy is appropriate for you. If you are a provider, learn more about partnering with Empower.
