OBJECTIVES: To evaluate the utilization of Medicare Part D compounded drugs and identify limitations in pharmacy claims data reporting to develop the framework for future studies to improve regulatory oversight and cost transparency.

METHODS: A retrospective observational study of patients receiving compounded products using 20% nationally representative sample of Medicare claims data from 2017-2019. The Part D Event(PDE) File was used to identify unique compounded claims through the compounding code submitted as part of the billing process, and to summarize clinical and economic drug-level characteristics. Master Beneficiary Summary Files were used to evaluate patient-level characteristics (demographic, chronic conditions) of all beneficiaries enrolled in a Part D plan receiving at least one compounded product during the study period. Data was categorized by USP category/drug class, dispense location, and overall drug spend to evaluate utilization patterns and identify trends over time.

RESULTS: 1,062,637 PDE compounded drug claims were identified during the 3-year study period. From 2017-2019, the annual cumulative frequency of PDE claims and beneficiaries receiving compounded products declined by 32% and 58%, respectively. Quantitative descriptive analysis enables interpretation of utilization trends, but the development of these findings highlight significant gaps in data reporting. Notably, the reporting system lists only one ingredient of a multi-ingredient preparation, making it impossible to correlate ingredients to associated costs, verify the beneficiary received the correct medication, or determine if stakeholders were billed properly for each product. Additionally, preliminary analysis demonstrates a significant portion of claims listing inactive ingredients as the reported claim ingredient.

CONCLUSIONS: While pharmaceutical compounding serves important medical needs, these individualized preparations do not have the same regulatory oversight as commercially available products, posing risks to patients. Yet, RWE of compounded products are inconclusive and raise substantial regulatory and economic limitations. Our findings identify healthcare delivery gaps in reporting claims information, surveillance, and price transparency for compounded medications.