HHS Announces Draft Enforcement Discretion Policy Paving Way for Pharmacies to Compound Certain Peptides While FDA Rulemaking Is Pending

On October 28, 2026, the U.S. Department of Health and Human Services (HHS) announced a draft policy under which it does not intend to take enforcement action against a state-licensed pharmacy, federal facility, or licensed physician that compounds a drug using one of six peptide bulk drug substances (BPC-157, epitalon, KPV, MOTS-c, semax, and TB-500) when 10 conditions are met.¹ The policy applies to compounding under section 503A of the Federal Food, Drug, and Cosmetic Act (FD&C Act) while the list of bulk drug substances eligible for 503A compounding (the 503A bulks list) is developed through rulemaking. HHS, rather than the U.S. Food and Drug Administration (FDA), issued the policy. HHS says its goals are to expand patient access and to discourage continued widespread use of “research-use-only” peptides from foreign manufacturers that pose a safety risk to U.S. patients, by offering a more controlled alternative. The policy does not approve any peptide and does not add any peptide to the 503A bulks list. As a policy of enforcement discretion, it does not bind the agency nor the public, and establishes no rights. HHS requested comments within two weeks of the October 30, 2026 date of publication in the Federal Register (by November 13, 2026).

Below, we summarize the policy and its conditions, place it in the context of FDA’s prior use of enforcement discretion for unapproved drugs, and explain why oversight, inspection, and adverse event reporting limits potentially create a distinctive patient safety issue for compounded products, even with the conditions HHS has attached with regard to the particular peptides described in this policy.

HHS’ Policy Announcement

The notice of availability is signed by Secretary Robert F. Kennedy, Jr. and describes the policy as a draft. HHS acknowledges that compounded drugs are not FDA-approved, that FDA does not review their safety, effectiveness, or quality before they are marketed, and that they may pose risks to patients. HHS nevertheless concludes, based on a July 2026 Pharmacy Compounding Advisory Committee (PCAC) meeting and data on peptide use, that there is significant interest in using these peptides in compounding given the lack of availability of approved products. The purpose of the policy is to expand access to peptide products, which is accomplished through the exercise of enforcement discretion. Such enforcement discretion will remain in effect until a peptide bulk drug substance is addressed in a final rule as included or not included on the 503A bulks list. 

Under the policy, HHS will exercise enforcement discretion with respect to state-licensed pharmacies, federal facilities, and licensed physicians compounding a drug product in accordance with the policy. The policy does not cover outsourcing facilities engaged in compounding under section 503B of the FD&C Act. Application of enforcement discretion requires meeting the following 10 conditions, summarized below.

1. 503A Interim Access List. Compounded drugs use only the bulk drug substances listed in Appendix A of the policy (BPC-157, Epitalon, KPV, MOTS-c, Semax, TB-500).
   
2. Identity of the Peptide Bulk Drug Substance. Use of a bulk drug substance that has the identity (amino acid sequence, chemical structure, molecular weight, and molecular formula) and the route of administration listed for each peptide described in Appendix B (e.g., intranasal, subcutaneous, etc.).
3. Characterization. The bulk drug substance used in compounding is sourced from a facility registered with FDA under section 510 of the FD&C Act and has a valid certificate of analysis (COA) with test results that are consistent with existing guidance-based criteria described by FDA (see Appendix B). Such characterization helps provide assurance that what a compounder receives from a supplier is what it claims to be and has been tested for identity, purity, potency, and the absence of contaminants such as endotoxins, heavy metals, microbial contamination, and impurities.
4. Original Manufacturer Disclosures. The original manufacturer, not a subsequent packer, repacker, labeler, or distributor, is registered with FDA and complies with current good manufacturing practice (cGMP) and other FD&C Act requirements. Further, the physical location of the manufacturing facility is listed on the COA provided to the compounder. If the compounder obtains the substance through a repacker, relabeler, or reseller, that entity must have performed and documented validation of the manufacturer and its COA.
5. Reporting Obligations. The compounder reports serious adverse events (whether or not considered drug-related) and product quality issues to FDA’s MedWatch program and to the states where the product is compounded and sent, and reports product information: the active ingredient and strength, the original manufacturer and its unique facility identifier, and the dosage form and route. The procedure for reporting adverse events and product issues should appear on the product labeling provided to the patient.
6. Product Labeling. The label states, “This is a compounded drug product. Not for resale.”
7. Single Active Ingredient. The product contains only one active pharmaceutical ingredient (API), and it is listed in Appendix A. According to HHS, a single-API product makes it easier to attribute adverse events or outcomes to a specific substance.
8. Oral Route of Administration. If a peptide is compounded in an oral dosage form, the compounder is expected to maintain documentation that the specific formulation achieves adequate oral bioavailability in humans.
9. Delivery Device. The only co-packaged or included delivery device is an FDA 510(k)-cleared syringe. 
10. Compounding in Compliance with All Other Applicable FD&C Act Requirements. The product is compounded in compliance with all other applicable FD&C Act requirements, including that it not be compounded under insanitary conditions and that it be compounded based on a valid patient-specific prescription.

HHS’ Policy Announcement Operates Outside of the Statutory Pathway and Departs From Established Practice 

Section 503A of the FD&C Act exempts a qualifying compounded drug from FDA premarket approval, cGMP requirements, and the requirement of adequate directions for use. To qualify for these exemptions, each bulk drug substance used to make a compounded drug either complies with an applicable United States Pharmacopeia or National Formulary monograph, is a component of an FDA-approved drug, or appears on the 503A bulks list.² None of the peptides at issue in the enforcement discretion policy care meets these criteria. Section 503A also requires that the bulk substance be manufactured by a registered establishment and accompanied by a valid COA, and that the drug be compounded on a patient-specific prescription. Several of the HHS policy’s conditions (3, 4 in part, and 10) restate these existing statutory requirements. 

Congress also set out a process for deciding which additional bulk drug substances may be used in 503A compounding. A substance is nominated with supporting information, FDA evaluates it and consults the PCAC, and FDA then adds it to the 503A bulks list (21 C.F.R. § 216.23) through notice-and-comment rulemaking: a proposed rule, public comment, and a final rule.³ HHS states that the PCAC consultation has occurred, but the remaining steps have not been completed for any of the covered peptides. The PCAC’s votes are advisory recommendations, CDER recommended against listing, and, as of this writing, there is no proposed rule to add these peptides to the bulks list. 

For each peptide, Appendix B acknowledges that FDA’s Center for Drug Evaluation and Research (CDER) recommended against addition to the 503A bulks list and that the PCAC voted in favor. According to the Associated Press, prior to pursuing the enforcement discretion policy, HHS initially sought an FDA regulation adding BPC-157 and other peptides to the bulks list, but FDA officials said the agency’s scientific staff had major safety concerns and would not support a regulation deeming the peptides safe. The AP also reported that most FDA scientific staff opposed the effort and had limited input into drafting, although FDA staff provided technical assistance on safety guardrails, including sourcing ingredients from FDA-registered facilities, verifying peptide identity, and collecting information on side effects. Those guardrails correspond to conditions 3, 4, and 5. Appendix B itself acknowledges CDER’s recommendation against listing each covered peptide.

Moreover, while enforcement discretion is one of FDA’s policy tools, HHS’ exercise of enforcement discretion in the case of peptides is a departure from FDA’s typical approach. FDA has exercised enforcement discretion that results in a wider availability of unapproved new drugs in narrow, time-limited circumstances. Recent examples include temporary enforcement policies during the COVID-19 pandemic and temporary enforcement discretion during shortages.⁴ But in general, the agency has typically worked to use its risk-based enforcement priorities to remove, not expand, unapproved drugs from the market rather than widen access to them, for example by encouraging manufacturers to seek approval of their products, and pursuing compliance action against products that pose a high risk to public health.⁵

The peptide policy differs from these precedents in several respects.

1. No emergency and no shortage. For the covered peptides, an approved product does not exist because none has been shown to be safe and effective, not because an approved product is unavailable. HHS’ rationale is different: it wants to displace research-use-only peptides from foreign manufacturers with a more controlled alternative. 
2. No defined endpoint. The policy runs until each peptide is addressed in a final rule amending the 503A bulks list. That requires a proposed rule, public comment, and a final rule, a process which could take an uncertain number of years.
3. A departure from FDA’s scientific review. CDER recommended against including every covered peptide on the 503A bulks list, as Appendix B acknowledges, and the policy was driven by HHS rather than FDA.⁶ Past exercises of discretion generally reflected FDA’s own assessment of risk and benefit.

Enforcement discretion also is not a legal authorization. It does not change the FD&C Act, does not bind state boards of pharmacy or medicine, and can be withdrawn without notice and comment. The covered peptides remain unapproved drugs, and a compounder or prescriber relying on the policy remains exposed to state-law and private litigation risk.

Compounded Drugs Present Distinct Oversight and Safety Risks

The policy asks patients, prescribers, and regulators to rely on a compounding framework that was not built to supply unapproved new drugs at scale. HHS has attached conditions that respond to some of the concerns CDER raised, but several features of the framework raise the risk profile of these products, as discussed below. 

An approved drug is reviewed by FDA for safety, effectiveness, and quality before marketing and is made under cGMP. A finished drug compounded under section 503A is exempt from those requirements, and the policy does not change that. CDER found the covered peptides poorly characterized, with missing endotoxin, impurity, and microbial data, and flagged immunogenicity concerns.

The policy conditions enforcement discretion on the original manufacturer of the peptide being FDA-registered and complying with cGMP, along with sourcing and COA requirements. These conditions would improve on unverified research-use-only vials, but they rely mostly on the supplier’s COA. Registration is not an inspection, and FDA inspects bulk drug substance manufacturers infrequently, so the COA relies on the manufacturer’s own representation of cGMP compliance. By contrast, FDA often inspects the facilities named in an application before approving a drug, including the drug substance manufacturer.

Furthermore, FDA inspects relatively few 503A pharmacies, and it generally does so in response to a complaint, a report of harm, or a specific risk signal. Traditional 503A pharmacies remain primarily the responsibility of state boards of pharmacy.⁷ The peptide policy may burden state boards, which may need to devote additional resources to check whether a pharmacy meets the policy conditions and to manage adverse event and quality reports. 

Additionally, the adverse event reporting framework may be tenuous. Manufacturers of approved drugs and 503B outsourcing facilities must report adverse events to FDA, but traditional 503A pharmacies generally have no comparable federal obligation, and their infrastructure may not be in place to submit such reports or conduct appropriate surveillance. Events involving their products reach FDA, if at all, through voluntary reports from clinicians or patients who may not know a product was compounded. FDA’s Sentinel system (its safety surveillance system) is unlikely to close the gap, since it depends on claims and electronic health record data, and wellness peptides are frequently purchased out of pocket and carry no product-level code. And while reporting to MedWatch and the states is a condition of enforcement discretion, this is not a statutory duty, and it is unclear how HHS is going to oversee compliance. 

Conclusion

HHS’ draft policy is an effort to steer demand for these six peptides away from “research-use-only” products sold by foreign manufacturers and toward prescribed, compounded drugs subject to identity, sourcing, and reporting conditions. The peptides remain unapproved drugs, and none qualifies for the 503A bulks list. Lack of oversight and inherent safety concerns remain, and challenges may emerge. Indeed, the Partnership for Safe Medicines has already filed a citizen petition asking FDA not to permit compounding of these peptides through enforcement discretion.⁸

Interested parties have limited time to provide their views — comments are due on November 13, 2026, two weeks after the Federal Register publication.

© Arnold & Porter Kaye Scholer LLP 2026 All Rights Reserved. This Advisory is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.