Extemporaneous Preparations (Compounds)

An extemporaneous preparation (compound) is a drug or mixture of drugs prepared or compounded in a pharmacy according to the order of a prescriber.

Any drug or product manipulated in accordance with its direction of use (e.g. mixing, reconstituting, prefilling syringes, filling infusion pump reservoirs) is not considered an extemporaneous preparation.

To be eligible as a benefit, a compound must meet one of the following criteria:

1. Contains one or more regular* benefit drugs 
2. Contains one or more special authorization drugs for which approval has been granted
3. Contains a combination of regular* benefit drugs and special authorization drugs for which approval has been granted
4. Is a compound that has been approved through special authorization

*Regular benefits include drugs listed on the NB Drug Plans Formulary that do not require special authorization, and the drugs and ingredients used in compounds that are listed in Appendix II of the New Brunswick Drug Plans Formulary

A compound is not an eligible benefit if any of the following apply:

1. An alternative is commercially available
2. Contains a drug or product on the exclusion list
3. Made using a proprietary recipe with an undisclosed ingredient list
4. Contains a non-benefit form of a drug (e.g. using powder vs. tablets) unless special authorization approval has been granted
5. Custom-compounded bioidentical hormones

When there is a shortage or no supply of a commercially available product and the healthcare professional has determined a medical need for this product, the product may be compounded during the period of shortage or no supply only. (Health Products and Food Branch Inspectorate Policy on Manufacturing and Compounding Drug Products in Canada, January 26, 2009)

Information on NB Drug Plans Claim Submissions is available here.

• Claims for compounds are to be submitted electronically using the eligible benefit DIN/PIN of at least one of the ingredients contained in the preparation.
• If a preparation contains both a regular benefit drug(s) and a special authorization drug(s), it must be billed using the DIN of the special authorization drug for which prior approval has been granted.
• Claims must be identified by entering the appropriate CPhA version 3 code.
• Manual claims from beneficiaries (pay and submit) will only be accepted for regular benefit preparations. If the preparation does not contain a regular benefit drug, the claim cannot be processed unless special authorization has been granted.
• If a participating provider does not submit an electronic claim for payment and provides a receipt to a beneficiary for a manual (pay and submit) claim, the participating provider must not charge an amount that is greater than the amount that would be paid if the claim was submitted electronically.

• Payments made for compounds are subject to audit and recovery.
• Compound Review Verification letters requesting documentation, may be sent to providers to confirm the ingredients contained in the compound and the acquisition cost of each ingredient.
• Although a claim with an eligible benefit DIN/PIN may be accepted electronically, if it contains a drug considered a non-benefit it is subject to recovery.