The History of Compounding During Drug Shortages: Lessons from 2022–2025

The compounded GLP-1 industry that exists today — a multibillion-dollar ecosystem of telehealth platforms, compounding pharmacies, and affiliate networks — did not exist in 2021. It was created, almost entirely, by a drug shortage. Understanding how that happened, and what happened when the shortage ended, provides essential context for anyone using compounded GLP-1s in 2026.

The Shortage That Built an Industry

2022: The Demand Wave

Ozempic was approved for type 2 diabetes in 2017, but mainstream awareness exploded in 2022. Celebrity use, social media attention, and emerging weight loss data created a demand surge that overwhelmed Novo Nordisk's manufacturing capacity. By mid-2022, the FDA placed semaglutide on the official drug shortage list — a determination that triggered a legal pathway for compounding.

Under Section 503A and 503B of the FDCA, pharmacies can compound copies of commercially available drugs when those drugs are on the FDA's drug shortage list. This exception — designed to ensure patient access during supply disruptions — became the legal foundation for compounded semaglutide.

2023: The Gold Rush

By 2023, the compounded GLP-1 market had exploded. Hundreds of telehealth platforms launched, each partnering with compounding pharmacies to offer semaglutide at a fraction of brand-name prices. Tirzepatide (Mounjaro/Zepbound) entered the shortage list in 2023, doubling the available market for compounders.

The economics were compelling on all sides: patients got GLP-1 access at $149-400/month instead of $1,000-1,300/month; telehealth platforms captured rapid growth in a massive addressable market; and compounding pharmacies saw unprecedented demand for a single product category.

During this period, quality was variable. Some pharmacies invested in PCAB accreditation, rigorous testing, and proper cleanroom infrastructure. Others cut corners to meet demand, operating at the minimum quality threshold — or below it. The FDA issued warning letters, but enforcement lagged behind the market's growth rate.

2024: The First Reckoning

October 2024 brought the first major disruption: the FDA removed tirzepatide from the drug shortage list, declaring the shortage resolved. This eliminated the shortage-based legal justification for 503B outsourcing facilities to compound tirzepatide at scale. Legal challenges from the Outsourcing Facilities Association (OFA) followed, but courts denied motions for preliminary injunctions.

503A compounding of tirzepatide continued under the patient-specific prescription pathway, which does not depend on shortage status. But the industry shuddered — if tirzepatide could come off the list, semaglutide was next.

Early 2025: Semaglutide Follows

In February 2025, the FDA removed semaglutide from the drug shortage list. The same legal and market dynamics played out: 503B compounding became untenable, 503A compounding continued, and the industry began consolidating around providers with durable 503A pharmacy partnerships.

The FDA simultaneously intensified enforcement, issuing dozens of warning letters to compounders and telehealth platforms for manufacturing deficiencies, false marketing claims, and products that the agency deemed essentially copies of commercially available drugs.

Lessons from the Shortage Era

Lesson 1: Shortages Create Markets That Outlive the Shortage

The GLP-1 shortage lasted roughly two years. The industry it created will last far longer. Patient demand for affordable GLP-1 access didn't disappear when brand-name supply returned — the price gap between brand-name ($1,000+/month) and compounded ($149-400/month) ensures continued demand as long as the legal pathway exists.

Lesson 2: Quality Variance Is the Industry's Greatest Vulnerability

The FDA's enforcement actions are almost always triggered by quality failures, not by compounding itself. Pharmacies that maintained high standards during the boom survived the regulatory crackdown. Those that sacrificed quality for volume became enforcement targets. The quality variance across the industry gave manufacturers ammunition to argue that all compounding is unsafe — an argument that FDA enforcement data partially supports, even though the best compounders produce products comparable to commercial products.

Lesson 3: The Legal Framework Is More Complex Than Patients Realize

Most patients who use compounded GLP-1s understand "it's cheaper than brand name." Few understand the difference between 503A and 503B, the significance of the shortage-list status, or the legal vulnerability of the "essentially a copy" question. This knowledge gap leaves patients unprepared when regulatory changes disrupt their access.

What This Means for Current Patients

• The compounded GLP-1 market is smaller and more regulated than it was in 2023 — which generally means higher average quality.
• 503A compounding authority remains intact and is the legal pathway through which virtually all current compounded GLP-1 access operates.
• Further regulatory changes are coming (503B Bulks List final rule, potential "essentially a copy" litigation), but they will likely take 12-18 months to materialize.
• The best protection for patients is choosing providers with transparent, accredited pharmacy partnerships — the operators who built for durability rather than the shortage boom.

Providers Built for the Post-Shortage Landscape