Reinventing the Wheel: FDA’s Hub-and-Spoke Fix for Drug Manufacturing Registration

This proposal is in line with recent FDA initiatives intended to strengthen US pharmaceutical manufacturing, improve supply-chain resilience, and encourage earlier engagement between the FDA and companies building domestic manufacturing capacity.

In practical terms, the proposed rule would make it easier for certain distributed manufacturing networks to register as one establishment, while also requiring more visibility into some foreign manufacturers whose ingredients or products ultimately enter the United States.

The FDA’s proposal is most relevant for companies that use distributed manufacturing, rely on foreign active pharmaceutical ingredient suppliers, or hold state manufacturer, wholesale distributor, or third-party logistics licenses. These companies should review whether the rule would require updates to FDA registrations, product listings, supplier records, import records, Drug Supply Chain Security Act (DSCSA) compliance, or state license files, among other items.

The proposed rule is currently open for public comment through September 11.

What FDA Is Trying to Address

The proposed rule addresses two areas where the FDA feels it does not currently have adequate visibility into the drug manufacturing supply chain. 

The first area is distributed manufacturing, which generally refers to a model where a company uses a central hub and multiple manufacturing units in different locations. The FDA’s current rules require each part of that network to register separately, even when the network functions as one operation. Under the proposed rule, the FDA would instead allow an eligible distributed manufacturing establishment to register as one establishment, while still giving the agency information about the hub and each unit.

The second area is foreign manufacturing. The FDA is concerned that some foreign manufacturers, including upstream active pharmaceutical ingredient manufacturers, may not be registered even though their products ultimately become part of drugs imported into the United States. Under this new proposal, the FDA would assign the main facility identifiers to the hub, but each manufacturing unit would receive its own unit identifier. Put more plainly, the FDA wants one registration for the network, but it still wants to know which specific unit made which product or generated which manufacturing data. The proposal would also create a streamlined process for adding, removing, or relocating manufacturing units — note, however, that the FDA has stated that companies would need to notify the agency before moving a unit. 

How Registration Timing Would Work

Under the FDA’s proposal, the timing of registration would depend on whether the distributed manufacturing network includes US or foreign components. A distributed manufacturing establishment would need to register if it includes a US hub or unit, or if a foreign hub or unit makes a drug that is imported or offered for import into the United States. For US units, the FDA proposes that registration generally be submitted within five calendar days after the first unit begins manufacturing for commercial distribution. For foreign units, registration would generally be required before the drug made at that unit is imported or offered for import into the United States. The FDA also contemplates that a US hub could serve as the importer for drugs made by a foreign unit in the same distributed manufacturing network. 

Why Foreign Suppliers Should Take Note

The foreign-establishment provisions may be important for companies that rely on foreign active pharmaceutical ingredient (API), intermediate, or over-the-counter (OTC) drug suppliers. The FDA explains that some foreign establishments may make products that are sold only to other foreign manufacturers, but those products may later become part of drugs imported into the United States. Per the FDA, this has limited the agency’s ability to see the full manufacturing chain for drugs entering the US market. The proposed rule would make clear that certain foreign establishments must register even if another foreign establishment further processes the drug before it reaches the United States. 

The listing requirements would also reach certain upstream foreign drugs. For example, if a foreign API manufacturer sells only to another foreign manufacturer, and that second manufacturer uses the API in a finished drug imported into the United States, the API manufacturer could need to register and list the API. The FDA estimates that this change could affect a small number of foreign establishments tied to approved applications and a much larger number tied to OTC monograph drugs. 

Potential State Licensing Implications

State licensing requirements for drug manufacturers are already a patchwork that varies considerably from state to state, and the proposed rule could add another layer of complexity to that landscape. The FDA says that the proposed rule would not preempt state licensing requirements, and many states rely on FDA registration information as an input into their own licensing programs, which raises a practical question the proposal does not resolve: how the new federal registration model, including the hub-and-spoke structure and separate unit identifiers, would be reconciled with each state’s existing licensing framework. Delaware, for example, requires a separate pharmaceutical-establishment license for each location and requires manufacturer applicants to provide proof of FDA registration. This question may be especially pronounced when a manufacturing unit is mobile, relocates, or operates in a different state from the hub, since a state board may still ask whether each location needs its own license, amendment, or controlled-substance registration even though the FDA treats the network as a single registrant. Companies should not assume that one FDA registration will automatically satisfy all state licensing requirements, and should expect to work through this state-by-state variation to determine how the new federal structure maps onto their existing obligations.

Practical Steps for Companies

Companies that may be affected should consider submitting comments if the proposal creates uncertainty or operational burdens. Distributed manufacturers may want the FDA to clarify when units are considered equivalent, what quality-system controls are expected across the network, how much advance notice is required before moving a unit, and how unit identifiers will appear in FDA records. Companies that rely on foreign suppliers should identify whether any upstream API, intermediate, or over-the-counter monograph suppliers may need to register or list for the first time. Companies should also review supplier qualification files, import records, quality agreements, serialization master data, and state license inventories to see whether they would need updates.

If finalized, the rule will become effective 30 calendar days after publication in the Federal Register, although the information-collection requirements would not take effect until the required approval process is complete. Companies that intend to submit comments should consider addressing, among other things, the practical burdens the FDA may not have fully captured, including foreign supplier onboarding, state licensing amendments, data-system changes, and questions about mobile or relocated units. Companies should begin that review promptly, as this work may require coordination among regulatory affairs, quality, supply-chain, trade and import, DSCSA, and state licensing teams.

For questions or guidance about the proposed rule, submitting comments, and anything in between, please contact the authors.