The US Department of Health and Human Services (HHS) announced on October 30, 2026 the availability of an enforcement discretion policy (the Policy) regarding pharmacy compounding with certain peptide bulk drug substances. This step may reflect the increasing consumerization of healthcare in the United States, which may create new opportunities for the sale (and delivery to patients) of certain unapproved drugs.
At the same time, a number of questions remain unanswered and companies compounding and selling such peptides, including telehealth platforms, should consider potential regulatory and legal risks that extend beyond the Policy, including actions by state attorney general’s offices, which are signaling increased enforcement efforts against alleged unfair and deceptive marketing of such products.
This LawFlash provides a summary of the Policy and considerations for companies producing and selling compounded peptides.
WHAT IS ENFORCEMENT DISCRETION?
Under the Policy, HHS stated that it does not intend to take action against state-licensed pharmacies, federal facilities, or licensed physicians that compound drug products using the applicable peptide bulk drug substances, so long as all of the qualifying criteria are met. While this does not provide a legal shield from agency action—enforcement discretion does not change the underlying statutory or regulatory requirements and can be later modified by HHS or the US Food and Drug Administration (FDA)—it does help provide clarity to a burgeoning industry.
WHAT ARE THE REQUIREMENTS FOR COMPOUNDING UNDER THE POLICY?
The Policy outlines several prerequisites that must be met for a company to fall within the agency’s enforcement discretion. For example, the only peptides that may be compounded are BPC-157, Epitalon, KPV, MOTS-c, Semax, or TB-500; compounded products may only contain a single peptide and may not be combined with other active pharmaceutical ingredients (APIs); the peptides must meet the Policy’s identity and route of administration requirements; and the peptides must be produced at a current good manufacturing practice (cGMP)-compliant and FDA-registered drug establishment.
If the peptide is obtained through a repacker, relabeler, or reseller, that entity must validate the manufacturer and its certificate of analysis. Compounding pharmacies must also comply with all Federal Food, Drug, and Cosmetic Act requirements for 503A pharmacies, including the requirement that drug products only be compounded pursuant to a valid patient-specific prescription. Other requirements are further outlined in the Policy.
WHY DID HHS ADOPT THE POLICY?
HHS took this action in response to Pharmacy Compounding Advisory Committee meetings, where an array of perspectives and views were discussed, and data on the utilization of peptides. Based on this information, HHS stated that it “believes that there is significant interest in the use of these peptides in compounding given the lack of availability of approved products.” The enforcement discretion policy is intended to discourage what HHS described as “the continued, widespread use of certain research-use-only peptides supplied by foreign manufacturers that pose a safety risk to US patients.”
Instead, HHS aims to provide patients with a “more controlled alternative” and determined that “the policy advances patient choice and freedom while appropriately protecting patient safety.” Nonetheless, the Policy represents a departure from the traditional premarket testing, clinical trial, and approval framework applicable to unapproved new drugs.
WHAT QUESTIONS DOES THE POLICY LEAVE OPEN?
While the Policy could expand patient access to compounded drug products with the six HHS-identified peptides, the following questions remain:
How might the midterm election affect the Policy?
Changes in congressional composition and oversight priorities could affect the future of the Policy, particularly given its relationship to broader healthcare policy initiatives. Although the Policy expressly contemplates HHS revisiting its approach, the extent to which political developments may influence its implementation remains uncertain.
Notably, the Policy specifically states that “HHS may revisit application of this interim policy (in whole or in part) if, among other things, a safety signal or product quality issue arises with a compounded drug product within the scope of this policy.” Whether the Policy will remain in place following the midterm election is uncertain, especially given that it was driven by HHS (not, as would be normally expected, FDA).
Can peptides be obtained from foreign manufacturing facilities?
The Policy does not speak to how foreign-produced peptides, even when produced at FDA-registered facilities, may be imported into the United States. In order to import an API, the ingredient must be imported for research use, or pursuant to an Investigational New Drug Application or approved marketing application. As imported peptides for use in compounding would not meet these criteria, compounders may look to obtain bulk peptide drug substances from domestic suppliers.
What can compounders and telehealth companies say about peptide drug products?
With the exception of certain label requirements, the Policy is silent regarding what may or may not be said about peptides, including their intended use. In the absence of specific guidance, FDA’s prohibition on misbranding would still apply. This includes requirements regarding claim substantiation and fair balance, and prohibitions on implying that compounded products are FDA approved or the same as or comparable to FDA approved products. Regulation of the promotion of compounded drugs, however, is an area of ongoing development. For instance, it is currently unclear what substantiation standard FDA would apply and what risks should be disclosed for a product that has not been FDA approved.
Notably, FDA has been active with respect to the marketing of compounded drug products, issuing more than 100 enforcement letters to companies advertising compounded drugs in 2026. Accordingly, both compounders and telehealth companies should monitor FDA’s enforcement in this space, and carefully review their promotion and advertising, as well as influencer content, to ensure that it meets current FDA standards.
How will the Policy be enforced?
While HHS has stated that it will not take enforcement action against compounders who comply with the Policy, what is less clear is how actively FDA will undertake enforcement actions against companies that are not compliant with the Policy. In this case, the Policy was promulgated by HHS and not FDA. FDA, however, would likely be the agency responsible for enforcement of the Policy.
In other contexts, FDA has taken differing approaches to undertaking enforcement against products that do not meet an enforcement discretion policy. For instance, in the case of laboratory-developed tests, the agency’s enforcement tended to focus on tests that were considered high risk, such as for Ebola, Zika Virus, and COVID-19. However, FDA has been more active in the enforcement of its homeopathic drug policy, issuing a number of warning letters to companies this year. Accordingly, companies producing and selling peptide drugs should assess their compliance with the Policy as well as their enforcement risk.
What other risks should compounders and other companies consider?
For companies producing and selling peptide drug products, although the Policy provides potential relief from the risk of FDA enforcement (provided that the products meet the Policy’s requirements), other compliance obligations and legal risks remain. For instance, both compounding pharmacies and medical practitioners are highly regulated at the state level through medical and pharmacy boards. These state requirements may differ from the Policy in meaningful ways.
Similarly, companies must also be mindful of legal risks under state unfair and deceptive marketing laws, as well as product liability. Attorney generals’ offices from across the country recently met in Washington, DC to discuss the possible use of state consumer protection laws specifically in the context of peptide products that might be sold based on inaccurate or inadequately supported claims. Numerous consumer class actions cite these same consumer protection statutes; and increasingly, state attorneys general offices may even retain some of the same private plaintiffs’ counsel as a “force multiplier” to assert such claims on behalf of the state.
Finally, compounders and telehealth platforms may also face actions in front of the Better Business Bureau’s National Advertising Division (NAD) or the Federal Trade Commission based upon product advertising. For instance, within the last year, a telehealth company marketing compounded semaglutide faced an NAD action that arose out of claims made regarding a compounded product’s safety, efficacy, and equivalence to a brand product. The novel nature of the Policy and these products may trigger new or different enforcement and related risks from these or other sources, which may in turn raise new legal issues for resolution, including in the First Amendment or preemption spaces. Accordingly, companies producing and selling compounded peptides should closely assess their regulatory and legal risk and consider potential mitigation strategies.
LOOKING AHEAD
These efforts may also impact ongoing or future traditional drug development programs for these or related products, including the existing regulatory incentives for developers to engage in lengthy, costly, and risky drug development.
Yet, while the Policy leaves many questions unanswered, it may also indicate broader opportunities. Specifically, the Policy may suggest that HHS is developing policy with an increased patient/consumer focus. It is notable that HHS specifically stated that the policy is intended to advance patient choice and freedom. This approach may reflect broader trends toward the consumerization of healthcare and health products and may create opportunities for the development and marketing of new products that directly respond to patient and consumer demands, both in the compounding space and via traditional drug development pathways.
