Manufacturing, supplying and advertising compounded medicines lawfully

If you plan to manufacture and supply compounded medicines, you must ensure you comply with all regulatory requirements in the Act and the Regulations.

Before you manufacture and supply compounded medicines, consider the following:

Can the person compounding the medicine lawfully manufacture it?

Confirm that the person compounding the medicine:

• holds a TGA manufacturing licence that authorises the compounding of therapeutic goods, or
• qualifies for an exemption from the manufacturing licence requirements outlined in Manufacturing compounded medicines.

Is the medicine exempt from inclusion in the ARTG?

Confirm that the medicine meets one of the exemptions outlined in Supplying compounded medicines.

Medicines for gene therapy, biologicals, medicinal cannabis products and glucagon‑like peptide‑1 (GLP-1) receptor agonist analogues are generally not covered by these exemptions.

Is the activity extemporaneous compounding or anticipatory compounding?

Determine whether the activity is:

• extemporaneous compounding, for an individual patient after receiving a prescription or request, or
• anticipatory compounding, carried out in advance of patient demand.

Confirm that the type of compounding is permitted under the relevant exemption.

Are there any specific requirements for the product you plan to compound?

Check if the product you plan to compound is subject to any of the specific requirements outlined in Requirements for specific compounding activities and products.

Failure to comply with relevant exemptions for compounding, either for manufacturing or supplying compounded medicines, may constitute a breach of the Act.

Unlawful compounding practices may contravene provisions in the Act that prohibit the manufacture of therapeutic goods without a licence, the supply of goods not included on the ARTG, or the unlawful advertising of therapeutic goods. This may result in significant fines, or civil or criminal penalties.

Under the Act, ‘manufacture’ includes the compounding of medicines.

For medicines, biologicals, vaping goods and other therapeutic goods that are not medical devices, manufacture means:

1. to produce the goods; or
2. to engage in any part of the process of producing the goods or of bringing the goods to their final state, including engaging in the processing, assembling, packaging, labelling, storage, sterilising, testing or releasing for supply of the goods or of any component or ingredient of the goods as part of that process.

Australian manufacturers of therapeutic goods must hold a manufacturing licence that specifically authorises the manufacture of those goods, including unapproved goods, unless the goods or the person manufacturing the goods is exempt from this requirement (see below).

This requirement applies to anyone carrying out the manufacture or a step in the manufacture, of the goods.

Manufacturing therapeutic goods without a valid licence and where no exemption applies, is unlawful. This includes compounded medicines. Significant fines and criminal or civil penalties can be imposed in relation to unlawful manufacture of medicines.

TGA-licensed manufacturers

A person who holds a TGA-issued manufacturing licence can compound and supply a medicine that is not on the ARTG directly to patients, as long as:

• the licence contains the appropriate authorisations and conditions, and
• the requirements for supplying compounded medicines are complied with.

For more information see Understanding Good Manufacturing Practice (GMP) for compounded medicines.

Persons exempt from manufacturing licence requirements

Under Schedule 8 of the Regulations, certain persons are exempt from the requirement to hold a manufacturing licence when compounding medicines, provided specific conditions are met.

Table 1 outlines the exempt persons and the criteria which must be met for the exemption to apply.

*Must be registered under state or territory law.

Generally, therapeutic goods must be included on the ARTG before they can be imported, exported, manufactured or supplied in Australia.

In certain circumstances, Schedule 5 to the Regulations exempts compounded medicines from this requirement.

Supplying unapproved goods where no exemption applies is unlawful. This includes compounded medicines. Significant fines and criminal or civil penalties can be imposed in relation to unlawful supply of medicines.

Extemporaneously compounded medicines

Under Item 6 of Schedule 5 of the Regulations, medicines are exempt from the requirement to be included in the ARTG when they are dispensed or extemporaneously compounded, for a particular person for therapeutic application to that person.

This means that:

• For a prescription-only medicine, the pharmacist has a prescription or order, and the patient has requested supply of the medicine before the pharmacist or relevant health practitioner compounds the medicine.
• For a non-prescription medicine, the patient has requested supply of the medicine before the pharmacist or relevant health practitioner compounds the medicine.

This exemption does not apply to:

• medicines that are used for gene therapy
• medicinal cannabis products, or
• medicines that contain GLP-1 receptor agonist analogues.

For more information see Requirements for specific compounding activities and products below.

Medicines compounded in a hospital

Under Item 6A of Schedule 5 of the Regulations, medicines compounded by hospital pharmacists are exempt from the requirement to be included in the ARTG, where they are:

• compounded in a private hospital by a hospital pharmacist who is engaged in the manufacture of therapeutic goods on the premises of the private hospital, or
• compounded in a public hospital by a pharmacist who is employed by the public hospital and engaged in the manufacture of therapeutic goods.

This exemption only applies to medicines that are:

• compounded in anticipation of being needed for therapeutic application to patients of the hospital, and
• considered by the hospital’s drug and therapeutic committee, however named, to be appropriate for compounding in anticipation of being needed to treat a patient at the hospital.

The intention of this exemption is to allow medicines to be compounded in circumstances where the unavailability of the medicine, or a delay in treatment, could pose a significant risk to patient health and safety.

For more information, see Anticipatory compounding below.

This exemption does not apply to:

• medicines that are used for gene therapy
• medicinal cannabis products, or
• biologicals.

For more information see Requirements for specific compounding activities and products.

Medicines that do not meet the criteria for the hospital compounding exemption may still be covered by the exemption for extemporaneously compounded medicines.

Quality standards for compounded medicines

Compounded medicines are not exempt from the requirement to meet the standards set out in the Act regarding the consistency of product quality.

These apply to therapeutic goods, both ingredients and finished products, that are the subject of the relevant monographs and are referred to as ‘default standards’. These are:

• the British Pharmacopoeia (BP)
• the European Pharmacopoeia (Ph Eur), and
• the United States Pharmacopoeia-National Formulary (USP).

For more information, see Complying with ministerial and default standards for medicines.

Therapeutic Goods Orders may also apply to compounded medicines, depending on the circumstances. Further information is available at Therapeutic goods orders.

Although compounded medicines are exempt from some requirements under the Act, they are not exempt from the advertising requirements.

Advertising unapproved therapeutic goods to the public, including compounded medicines, is prohibited under subsections 42DL(12) and 42DLB(9) of the Act, unless the advertising is authorised or required by a government or government authority.

Advertisements directed exclusively at health professionals are exempt from these restrictions.

For more information see Advertising to health professionals so consumer rules do not apply. 

Unlawfully advertising compounded medicines to the public may also contravene other criminal and civil penalty provisions under the Act, including:

• the prohibition on advertising medicines containing substances included in Schedule 3, 4 or 8 to the Poisons Standard (but not in Appendix H to the Poisons Standard)
• use of restricted and prohibited representations without permission or approval from the TGA
• non-compliance with the Advertising Code - see Applying the Advertising Code.

For more information refer to the Advertising legal framework.

Advertising compounding services

While you cannot advertise compounded medicines to the public, you can advertise your compounding service, provided you comply with other relevant legislation, such as the Health Practitioner Regulation National Law.

To ensure your health service advertisement is not an advertisement for therapeutic goods, avoid referring to specific products manufactured, supplied or used in the delivery of the service. This approach ensures that your advertisement focuses on the compounding service itself.

For guidance on compliant advertising practices for your compounding service, see Advertising a health service.

Anticipatory compounding

Compounding medicines in anticipation of demand is only permitted for hospital pharmacists, and only when the compounding occurs in a hospital in accordance with Item 6A of Schedule 5 of the Regulations.

For more information see Medicines compounded in a hospital.

In all other circumstances, compounding in anticipation of demand is prohibited. Pharmacists and other relevant health practitioners must not prepare compounded medicines before receiving a prescription or a specific request from an identified patient.

Example

A community pharmacist becomes aware of a supply shortage of a particular medicine, and compounds a substitute product to have stock available for consumers.

Reason why this is not compliant

This is compounding in anticipation of demand, and is therefore not exempt under the Regulations.

As no exemption applies, this product must be included in the ARTG to be lawfully supplied.

Batch preparation

Pharmacists may prepare a larger quantity (batch) of compounded medicine to supply individual units to identified patients, provided this only occurs after a prescription or order has been received for all of the medicine in that batch (See Anticipatory compounding). 

Pharmacists should consider whether batch preparation is appropriate in the circumstances. For more information see the Pharmacy Board’s Guidelines on compounding of medicines.

Vaping products

Different rules apply to compounding vaping products.

For further information see Vapes: information for pharmacists - Compounding.

Medicinal cannabis products

Medicinal cannabis products are not covered by the extemporaneous compounding exemption.

Other legislation may allow for the lawful extemporaneous compounding of medicinal cannabis in certain circumstances. For more information see Medicinal cannabis reforms: Frequently asked questions.

MDMA and psilocybine products

MDMA and psilocybine are controlled drugs under the Poisons Standard and the Commonwealth Criminal Code. They must not be compounded without proper authorisation.

The exemptions under the Act do not override these controls. Compounding MDMA and psilocybine may also be unlawful under state and territory legislation.

Pharmacists should seek advice from their relevant state or territory health department before compounding MDMA or psilocybine products.

For more information, see dispense or compound MDMA and psilocybine (pharmacists).

Glucagon-like peptide-1 (GLP-1) receptor agonist analogues

From 1 October 2024, pharmacists must not compound medicines containing GLP-1 receptor agonist analogues.

Intravenous (IV) drip therapy

IV drips deliver therapeutic substances into the body via a vein, such as fluids with vitamins and minerals. IV drip products may also be referred to as drips, infusions, fluids, or other terms.

IV therapy combines a health service (the clinical administration of an IV infusion) with a therapeutic good (the IV drip). For simplicity, this section refers to ‘IV drips and related therapies’ as ‘IV therapy’.

If you manufacture or supply compounded IV therapy products, you must ensure you comply with all requirements:

• The person compounding the product is exempt from manufacturing licence requirements. If no exemption applies, they may be unlawfully manufacturing therapeutic goods.
• The therapeutic goods and their ingredients comply with any relevant quality standards for compounded medicines.
• Products are only compounded after receiving a prescription or a request for a specific patient - see Anticipatory compounding and Extemporaneous compounding.
• Advertising for the business or service does not refer to compounded medicines that are available at the service - see Advertising compounded medicines.

In addition, administering unlawfully supplied therapeutic goods may breach health practitioner obligations under Ahpra registration requirements.

• Unapproved therapeutic goods
• Ahpra: Guidelines on compounding of medicines
• Advertising