How to become a compounding pharmacy

Sometimes a “one-size-fits-all” approach to medication means that patients’ needs are not met by a traditional registered pharmacy. The ability for a pharmacist to compound therapeutical products tailored to suit the needs of their consumers can give the pharmacy an edge over its competitors

Owners of registered pharmacies may wish to look into adapting their business and premises to allow for it to provide for compounding pharmacy services. The process of change from a registered pharmacy to a compounding pharmacy is made easy by the fact that there are no additional registration or licensing requirements to be met to enable a pre-registered pharmacy to begin compounding therapeutic products on the proviso that the pharmacy is open to the public.

That being said, there are operational and structural requirements that the pharmacy must comply with to permissibly compound therapeutic products on the premises. This alert will briefly provide an overview of these requirements.

Why become a compounding pharmacy?

Compounding therapeutic goods permits a pharmacist to adjust the strength of the medication and remove certain ingredients (such as dyes, preservative, lactose, gluten, or sugar) to accommodate for allergies. Enabling a pharmacist to make such alterations to the therapeutic goods sold may expand the consumer base for the medications that a particular pharmacy can provide, and enhances a pharmacist’s ability to offer tailored medication with a higher likelihood of being effective.

No Licence Requirement

The Therapeutic Goods Act 1989 (Cth) (“the Act”) require that certain premises be licenced before they are used as a location at which therapeutic goods are manufactured. However, the Act prescribes a class of exempt individuals who are not required to obtain a licence.

A pharmacy will not be required to obtain a licence to manufacture (or compound) therapeutic goods if the pharmacy is registered and operated by registered pharmacists, and:

  • The pharmacy is open to the public; or
  • The pharmacy is on a premises where the dispensary is conducted by a Friendly Society; or
  • The pharmacy is within a private hospital and supplies the therapeutic goods (other than wholesale) to the hospital.

Operational and Structural Requirements

There are additional requirements (other than legal obligations) that a pharmacy and pharmacist must comply with to compound therapeutic products on the premises. They are as follows:

  • Pharmacists and all persons responsible for the premises (such as landlords) must ensure that the premises are adequately designed, equipped, maintained and resourced for compounding medicine. What is adequate is highly dependent on the type of compounding (simple versus complex, and the type of therapeutic goods).
  • Compounding can only be carried out by pharmacists who have completed education and training in compounding and can demonstrate competency in the relevant compounding techniques. A pharmacist entering into the profession is deemed to have the requisite education to carry out simple compounding. A pharmacist who wishes to carry out complex compounding must undertake Continuing Professional Development Registration Standard (“CPD”) activities which are provided by the Pharmacy Board of Australia. There are a number of guidelines and regulatory documents which address the education requirements of a pharmacist to carry out compounding. We can provide this information upon instruction.
  • A pharmacist who compounds medicines must have appropriate risk management processes in place. For example, for the maintenance of facilities, quality assurance of products, and professional indemnity insurance.


In summary, there are no additional registration or licensing requirements for an already registered pharmacy to begin compounding therapeutic products on their premises as long as the pharmacy is open to the public. Even though there are no inherent legal restrictions in a pharmacy (open to the public) allowing its registered pharmacists to compound medication, you should bear in mind that the:

  • premise requirements (which are highly dependent on the type of compounding the pharmacists will be carrying out);
  • pharmacist competency requirements; and
  • appropriate risk management requirements

must all still be met and achieve the requisite standard set by the Pharmacy Board of Australia.

If you are interested in becoming a compounding pharmacy and you want to ensure that you satisfy all the legal, operational and structural requirements that such an endeavour entails, then Cowell Clarke can provide you with specific, tailored information and assist you in making the transition. Please also feel free to call one of our team members for further information.

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