Q&A with
Lou Diorio, RPh

Pharmacy Purchasing & Products: Given the ongoing tragedy caused by contaminated compounding products, what steps do pharmacy directors need to take to evaluate their compounding practices?
Lou Diorio: Continuous vigilance is the cornerstone of any compounding program and it starts with aggressive formulary management. The pharmacy director’s level of involvement with the P&T committee is key—simply reviewing the needs of the clinical services and staying abreast of new drug entries and delivery systems is not sufficient; rather, pharmacy must work in conjunction with medical staff to understand the outcomes they are trying to achieve and identify the best path to deliver those results. 

In addition to clinical issues, operational and regulatory issues also must be part of formulary decisions. As a business manager, it is the pharmacy director’s responsibility to assist the hospital or health system in managing expenses. To determine the cost of compounding, a full analysis is required. We recommend using a realistic return on investment (r-ROI) model that includes not only the cost of the drug and diluent, but also the cost of labor, testing, and any necessary equipment (eg, CSTDs). Likewise, regulatory compliance includes inherent costs that must be factored into the equation. For example, the cost of sterility testing as required by regulations must be included in the analysis of dosage pricing. Only when clinical, regulatory, and operational issues have been analyzed can pharmacy truly evaluate what products must be compounded.

The next step to increase safety is the adoption of standard clinical practice. A classic example is oxytocin use in obstetrics and gynecology. All too often, a facility will provide oxytocin in three different diluents and four different concentrations to meet the preferences of different provider groups. Pharmacy needs to take this opportunity to present the case that when compounding practices become burdensome, patient safety may be at risk; thus, good clinical practice incorporates good compounding practices. By limiting oxytocin to a single diluent and two concentrations, the facility can go from six or eight individual items to one or to two. While the doses produced remain the same, managing fewer SKUs simplifies the process for pharmacy. Pharmacy can then focus on providing additional oversight for their compounding processes, be they in-house or outsourced. 

Most important, establish a formulary rule that your facility will not compound (either in-house or by contract) any product that is commercially available itself, or for which a suitable bioequivalent product is commercially available. The value of establishing this tenet as a core facility practice has been driven home by the current tragedy.

PP&P: Are there steps a pharmacy director can take so that they can confidently state that they are not at risk for such a tragedy?
Diorio: There is no way to guarantee this will not happen again, the question is: how do you limit your risk? This is done through constant vigilance, constant diligence, asking good questions, and being involved in the process. The pharmacy director has a fiduciary responsibility to oversee the person compounding CSPs, be they in-house or outside contractors. The pharmacy director cannot abdicate their responsibility to the pharmacy purchaser or to their outsourcing partner. 

When working with an outsourced compounder, it is important to remember that they are your outsourced partner. In fact, I recommend pharmacy adopt this term as standard use. When we think of the iron triangle between the patient, physician, and pharmacist, the outsourcer is an extension to this care triad; they join as a pharmacy partner. Remember that every pharmacist dispensing a product from an outsourced vendor shares liability with that vendor, under both state and federal law. When the primary focus of an outsourced vendor relationship is unit cost and sell price, it is no surprise that quality and safety could be at risk. PP&P has covered compliant compounding practices extensively over the past few years, with article topics ranging from developing an RFP for contract vendors and understanding licensure requirements, to establishing environmental standards, quality processes, and required documentation and that information is available on the PP&P website. 

In addition to developing expertise in compliant practices, the pharmacy director also needs to create a custom assessment tool that reflects their own practices. While there are standard assessment tools available, as part of pharmacy’s due diligence, the assessment tool must be edited to reflect your own practice. It is also important to visit your state board of pharmacy’s website and make sure you are compliant with their regulations. Recently, some states have instituted emergency regulations in response to the contamination crisis, which may require process changes at your facility. 

Ultimately, whether your compounding is conducted in-house, outsourced, or some combination therein, the process must be overseen by a dedicated staff member with appropriate expertise, training, and experience. 

PP&P: How should a facility evaluate their formulary in terms of outsourcing versus in-house production?
Diorio: The entire formulary of a hospital should be divided into four distinct layers, forming a pyramid (see Figure 1). The two bottom layers of the pyramid are those doses that can be purchased, the goal is to avoid putting unnecessary volume through the cleanroom. The base of the pyramid encompasses ready-to-use doses, including proprietary vial and bag systems; any product commercially available in a point-of-care system should be purchased as such. Part of the formulary management process should include investigating the possibility of using more of these products (eg, MINI-BAG Plus, ADDVantage, Vial2Bag, and other proprietary vial and bag systems). Even if the point-of-care product has a higher per dose price than your compounding costs, the safety and efficiency these products deliver should outweigh the additional cost. The next layer (green) includes institutionally fixed formulas with an order volume sufficient to be outsourced. Standard preparations like magnesium and calcium CSPs that are traditionally purchased from outsourcers make up this layer. Again, to avoid increasing the volume in your cleanroom, outsourcing should be considered for these products.



The top two layers of the pyramid comprise elements that should be the focus in the cleanroom. The pinnacle of the pyramid encompasses specific, individual patient doses, such as aminoglycoside antibiotics, that are dosed by body weight, products that are custom compounded for a single patient. The layer below this (red) consists of institutionally specific formulas unique to your hospital that may not meet the outsourcers’ volume requirements. 

Assigning every product in the formulary to one of these categories is a significant undertaking and cannot be accomplished by pharmacy alone. In addition to purchasing more unit-of-use products, standard protocols may need to be updated. Therefore, this must be a multi-disciplinary endeavor, with pharmacy at the center to speak to the clinical issues as well as the intersecting operational and regulatory issues. A cultural change may be required within your facility to adopt this approach. It is important to emphasize to all involved that this is not change for change’s sake; rather, in the wake of the meningitis outbreak, this is change for necessity’s sake. 

Once products are assigned to these sections, they must be reviewed at least annually to take into considerations any practice changes. For example, you may find the price of an outsourced product is increasing while your volume is dropping. Likewise, a product that was previously used sporadically may now be popular enough to consider sending out so that you can focus on other products in the cleanroom. Maintaining the effectiveness of this system requires a commitment to regular reviews.

PP&P: What about facilities that are planning to conduct all of their compounding in-house?
Diorio: Many facilities are considering bringing all of their compounding in-house, some driven by ongoing cost containment concerns, while others have been impelled in this direction more recently by the CSP contamination tragedy. Keep in mind, no matter how large your budget, every cleanroom has a finite capacity. It is important to realistically evaluate the available space versus compounding volume when considering bringing all compounding in house: Can you hire sufficient staff, does the compounding room layout allow for the addition of more staff or will you need to add additional shifts? Furthermore, you need to consider the expertise required to run such a program: Do you have the capacity to manage ongoing training for new hires, how comprehensive is your environmental monitoring program, can you conduct chemical stability and microbiological sterility testing in-house or will this need to be outsourced, is your facility qualified to conduct high-risk compounding? 



A back-up plan also is necessary. In light of Hurricane Sandy shutting down the northeast for two weeks last month, an emergency preparedness plan must be in place: How will you operate if your staff cannot get to the facility, how much inventory do you keep on hand to offset impeded deliveries, do you have a relationship with an outsourcer you can rely on if your own compounding facility is without power for an extended period?

Unfortunately, pharmacy’s strong focus on developing clinical expertise has resulted in a dearth of qualified compounding pharmacists. Given the number of pharmacy directors who are challenged in finding qualified staff to manage their cleanrooms, we need to consider establishing certification programs, board certification, or other specialized credentials for compounding pharmacists. Such programs would serve to encourage professional development in this area and to standardize practices.

PP&P: Any final thoughts?
Diorio: When a tragedy of this magnitude occurs, it easy to get lost in the morass of blame. We can blame the vendor, or cite shortcomings by the FDA or the state, but all this does is placate our own fear that this could happen to our own patients. At the end of the day, this is about patient safety and it needs to be fixed and we in pharmacy need to fix this by raising the level of compounding practice. If we learn nothing from the suffering and loss of life that has occurred as a result of these contaminated compounds, if nothing significant changes in our practices, it will be inexcusable. Now is the time to ensure compliant practices ensue and this process must be driven by pharmacy in conjunction with administration.

Lou Diorio, RPh, is a principal of LDT Health Solutions, Inc, a medication safety and quality management consulting company. He graduated from Long Island University’s Schwartz College of Pharmacy, where he is also an adjunct professor of pharmacy practice and preceptor of pharmacy students.  Lou has practiced in and managed pharmacies in hospital, home care, cGMP compounding, and community settings and can be reached at LSDIORIO@LDTRx.com.