503A versus 503B: the two kinds of compounder, in plain English

Two sections of one statute, the Federal Food, Drug, and Cosmetic Act, decide what a compounder may do. Both are exemptions. A compounded drug is a new drug that has never been approved, and the only reason it can be sold at all is that section 503A or section 503B exempts it from three requirements: premarket approval, the "adequate directions for use" labelling rule, and (for 503A only) current good manufacturing practice. Everything else on this site follows from that one fact.

Section 503A: pharmacies and physicians

Section 503A has been in the Act since 1997 and describes traditional compounding. The exemption applies when a licensed pharmacist in a state-licensed pharmacy (or a licensed physician) compounds a drug for an identified individual patient on a valid prescription. The conditions include:

• The drug is made from bulk substances that meet one of the statute's criteria: they have a USP or NF monograph, they are components of an FDA-approved drug, or they appear on FDA's 503A bulks list (with an interim policy for substances still under review; see the PCAC and bulks lists page).
• The compounder does not compound "regularly or in inordinate amounts" a drug that is essentially a copy of a commercially available product. What that phrase means is on its own page: essentially a copy.
• The drug is not on FDA's list of products withdrawn for safety reasons and is not one that presents demonstrable difficulties for compounding.

A 503A drug is not held to CGMP. The applicable quality standards are the USP compounding chapters (795 for non-sterile, 797 for sterile) as adopted by state law, and the state board of pharmacy is the body doing the day-to-day inspecting. FDA can and does inspect 503A pharmacies for cause and on surveillance, and FDA's compounding actions page lists the results.

Section 503B: outsourcing facilities

Section 503B did not exist until the Drug Quality and Security Act was signed on November 27, 2013, a year after the New England Compounding Center outbreak. It created a new kind of entity, the outsourcing facility, that chooses to register with FDA and in return may compound sterile drugs without patient-specific prescriptions, including for office use by clinics. The conditions:

• Register with FDA every year and pay an establishment fee.
• Comply with CGMP. This is the same standard applied to conventional manufacturers, adapted by guidance for compounders.
• Report adverse events to FDA and submit a product report twice a year listing what was compounded.
• Label products with a statement that the drug is a compounded drug, plus the facility name, lot, beyond-use date and other required items.
• Use bulk substances only if they are on FDA's 503B bulks list or the finished product is on FDA's drug shortage list at the time of compounding. This last condition is why the GLP-1 shortage resolutions mattered so much to 503B facilities; see what compounders may do now.

FDA inspects outsourcing facilities on a risk-based schedule and publishes, for each registered facility, the last inspection date, whether a Form 483 was issued, recall history and any action taken. As of September 2, 2026, FDA's list held 119 registered facilities. Registration is self-reported and FDA says so on the page: appearing on the list is not FDA verification of anything except that the facility registered.

Side by side

What the labels tell you

A 503B product label must say it is a compounded drug and name the outsourcing facility. A 503A label carries the patient's name, the prescriber and the pharmacy's name and address, because it was made for that patient. If a vial you receive names neither a patient nor an outsourcing facility, it was not dispensed under either section. The certificate of analysis page covers the other document you may be handed.

Why "not FDA approved" is not a slogan

FDA's own words: it "does not verify the safety, effectiveness or quality of compounded drugs before they are marketed." That applies equally to a 503A vial from the pharmacy down the street and a 503B vial from a registered facility. Approval means a specific product, made by a specific process at a specific site, was reviewed against clinical data and is monitored afterwards. Neither section provides that. It is the reason FormBlends' own regulatory status page says the same thing about the compounded products it dispenses, and the reason the vetting checklist asks who is compounding before it asks anything else.