Why is Compounding Pharmacy growing in Australia?

Matt Chalmers

When I started in this industry in 2002, there were just 12 compounding pharmacies in Australia.

Today, there are over 500 compounding pharmacies that will make and dispense medicines by doctor’s prescription and patient order.

There are a number of reasons for this rise, however there are two major contributors that, above all others, influence this growth:

  1. Retail pharmacy profits are ever-diminishing.
  2. Personalised medicine is in the rise.

Why are retail pharmacy profits down?

The rise of the “big box” pharmacy (think, Chemist Warehouse) mean that local pharmacies have trouble competing. When your local competition can sell their stock for lower than you can buy it, based on volume of purchases, business is tough.

Along with increased competition, the Australian government has steadily been reducing pharmacy profits from controlled PBS prices

The rise of personalised medicine

Personalised medicine is a growing market sector. Routinely, when the subject is brought up in conversation, the comment made – no matter the location – is always, “It’s the future.”

And it is the future. As big pharma deteriorates, the era of smaller, bespoke manufacturers draws nearer. And who better to provide these services in Australia than Compounding pharmacies, such as ACP?

Big Pharma as an industry has been on the decline since the early 2000’s. A 2016 article in Forbes Magazine states:

“For decades, the pharmaceutical industry has been highly profitable. The recipe for such profits has been pretty simple for most of the last half-century–discover a chemical or molecule that treats a common problem, like hypertension or diabetes or erectile dysfunction, and make billions of dollars while that product is still under patent protection. But of course, profits were never so simple. It takes billions of dollars to develop one new drug suitable for testing in humans and even then, the drug might turn out to be too toxic or to have too little benefit to make it on to the market. It might take a handful of such drugs before a company finally finds one that works, a single blockbuster that can hopefully make up for all that investment. But the cost of new drug development is rising, and the number of big wins is declining–with the number of common illnesses in need of interventions dwindling–so it is getting increasingly difficult to bring enough blockbusters to market to make up for all those drugs that go bust.”

https://www.forbes.com/sites/peterubel/2016/07/29/is-the- golden-era- of-pharmaceutical- profits-over/#ea6a3207207b

Pharmaceutical compounding has long been the bastion of personalised medicine. The use of compounding pharmacy by health practitioners and professionals has increased exponentially since 2000. But its roots of course are much earlier, and indeed every pharmacy before the establishment of Big Pharma engaged in some form of compounding.

Our own CEO and founder, Daryll Knowles has long roots in preparing formulas to specification – as early as the 80’s – when he made timed-release capsules for children needing a sustained dose of medicine to see them through their school day. These were produced in his compounding pharmacy in Sydney.

However, there is a more recent development that heralds exciting times for compounding pharmacies in Australia.

Pharmacogenomics is the study of the role of genes in drug response. That is, how an individual will metabolise a particular drug. Put simply,  pharmacogenomics tells us that patients don’t belong in the pigeon-holes that current regulations think we do.

Let’s illustrate with an example.

Michelle has a condition which requires a specific drug to alleviate her symptoms. This drug is available in 2 strengths, 50mg and 100mg. However, when Michelle takes the 50mg strength, she does not get resolution of her symptoms. When she takes the 100mg strength, her symptoms go away, but she gets side-effects.

A simple test of Michelle’s pharmacogenomics illustrates that indeed, those two strengths are not suitable for her, and that she requires a dose in the middle – 75mg. However, to make a drug commercially available in Australia is very expensive – up to $2million – for one dose form (eg capsules, tablets, creams etc) and one strength. Big Pharma is not in a position to register a dose specifically designed for Michelle as they would never recoup their investment.

This is where pharmaceutical compounding can help.

Compounding pharmacies in Australia are able to produce a customised medicine, specific to Michelle’s needs. A compounding pharmacy can make the right dose and even change the dose form, to help our patients achieve the best clinical outcomes.

Of course, we use simple numbers in this example, but this is what our pharmacists at Australian Custom Pharmaceuticals, the largest compounding pharmacy in Australia, are doing every day.

The future of compounding

So where is all of this going?

There is a push by regulators to change compounding. Changes have been proposed to regulations regarding sterile – that is, compounding of products that are to be injected – to improve the basic requirements of training and facilities of compounders providing these services. It is a step in the right direction, and will ensure that only those compounding pharmacies in Australia with intent to produce high-quality materials are able to operate.

More and more researchers are pointing to customised medicine being the future. More and more doctors are engaging in the education required to provide this level of medicine to their patients.

More and more organisations and continuing medical education providers are delivering the training necessary to tailor medicines and medical offerings to the individual patient’s needs.

Certainly, personalised medicines, taking into account simple considerations such as patient age, weight, BMI and sex, or more complex factors such as individual genomics, are an ever-increasing medical sector – one which compounding pharmacies in Australia are poised to service with their offering of tailor-made and bespoke medicines.

Leave a Reply