The rapid expansion of large-scale pharmacy compounding has outpaced existing regulatory frameworks, prompting bipartisan legislative action in the United States Senate. The Safeguarding Americans from Fraudulent and Experimental (SAFE) Drugs Act of 2026 (S. 3794) seeks to modernize oversight of the compounding market, a move underscored by the US Food and Drug Administration's (FDA) ongoing warnings about unapproved compounded GLP-1 drugs, including retatrutide.
The problem with modern compounding
Pharmacies were originally built to make unique doses for individual patients. Today, massive compounders ship large quantities of drugs—such as GLP-1 weight-loss medications—across state lines. Compounded drugs do not undergo the strict FDA pre-market testing process for safety and effectiveness that standard brand-name drugs require. State pharmacy boards handle most local compounders, but these boards have limited resources and struggle to police facilities that sell products nationwide. A pharmacy disciplined in one state can often keep shipping to others.
Michael Reilly, executive director of the Alliance for Safe Biologic Medicines, has argued that mass compounders often bypass safety frameworks by making minor, unnecessary changes to standard drug recipes to claim a product is ‘personalized’. Regulatory guardrails, he says, must continue evolving to keep pace with bad actors who put profit above safety.
Legislative response
The SAFE Drugs Act, introduced by Senators Jim Banks (R-Ind.) and Martin Heinrich (D-N.M.), was advanced by the Senate Health, Education, Labor, and Pensions (HELP) Committee on 22 July 2026, by a vote of 17-5. It now awaits consideration on the Senate floor.
As introduced, the bill would increase the frequency at which a licensed pharmacist or physician may compound a drug that is ‘essentially a copy’ of a commercially available drug to 20 times per month, up from the current FDA policy of four. It also imposes annual reporting requirements on pharmacies that compound certain products for out-of-state patients more than 20 times per month, and subjects large-scale outsourcing facilities to regular inspection requirements.
FDA concerns: unapproved retatrutide and compounded GLP-1s
The FDA has explicitly stated that retatrutide and cagrilintide cannot be used in compounding under federal law, as they are not components of FDA-approved drugs and have not been found safe and effective for any condition. The agency has issued warning letters to telehealth companies marketing unapproved drugs such as retatrutide, to active pharmaceutical ingredient distributors selling retatrutide to compounders, and to outsourcing facilities for repackaging retatrutide.
The FDA has also documented significant safety concerns. As of 31 May 2026, the agency had received 990 reports of adverse events associated with compounded semaglutide and more than 730 reports associated with compounded tirzepatide. The FDA notes that federal law does not require state-licensed pharmacies that are not outsourcing facilities to submit adverse events to the agency, so actual reporting is likely underestimated.
Industry perspectives
The National Community Pharmacists Association and the Alliance for Pharmacy Compounding (APC) opposed the bill as introduced. After a manager's amendment, APC acknowledged the removal of the "essentially a copy" definitions and the 20-copy monthly cap, with a 5% out-of-state reporting threshold replacing the original trigger.
Reilly concluded that strong regulatory systems are not static but strengthened over time as new challenges emerge. The SAFE Drugs Act, he wrote, continues that tradition by modernizing oversight where it is needed most while preserving the important role compounding plays in patient care.
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