Law firm guidance says the Fifth Circuit ruling closes the shortage defense for tirzepatide compounders

Compounding pharmacies and telehealth companies lost their strongest legal argument for continuing to sell large-scale, mass-produced copies of semaglutide and tirzepatide products, according to a client alert from the law firm Clark Hill discussing two Fifth Circuit Court of Appeals decisions issued August 27 and September 1, 2026.^[1] The court upheld the FDA's earlier findings that shortages of Ozempic, Wegovy, Mounjaro, and Zepbound had ended, which is the legal event that had allowed compounders to make copies of those drugs in the first place.^[1]

The tirzepatide case, decided August 27, involved Mounjaro and Zepbound, made by Eli Lilly.^[2] The FDA had added Mounjaro to its shortage list in December 2022 and Zepbound in April 2024, then declared the shortage resolved in October 2024 and reconfirmed that finding in December 2024 after a court-ordered review.^[2] During the shortage period, Eli Lilly said it spent roughly $23 billion expanding manufacturing capacity, building and acquiring facilities in the United States and Europe and winning FDA approval to sell single-dose vials in addition to pens.^[2] The FDA gave compounders a transition window of 60 or 90 days, depending on the type of pharmacy, before enforcing rules again.^[2]

Compounders, including the Outsourcing Facilities Association and a company doing business as Farmakeio Custom Compounding, argued the FDA should have used formal notice-and-comment rulemaking before delisting tirzepatide, and that the agency's decision was arbitrary because it leaned on manufacturer data over reports from patients, pharmacies, and telehealth companies.^[2] The Fifth Circuit rejected both arguments. It said that even if the FDA skipped a required rulemaking step, the compounders were not harmed because they had actual notice and repeated chances to submit evidence.^[1] The court also found the FDA reasonably relied on Eli Lilly's supply and inventory data over other evidence, including access reports collected through a Hims & Hers website, which the FDA said did not reliably show when or where a supply problem occurred or whether the same person submitted multiple reports.^[1] A related case over semaglutide, involving Novo Nordisk, reached the same result on September 1.^[1]

Why it matters for patients

For people currently using compounded semaglutide or tirzepatide, this ruling reinforces that the broad legal basis compounders once used, the official shortage listing, is gone according to the FDA and now upheld by a federal appeals court.^[1] The alert says compounding pharmacies can no longer rely on the former shortages to justify producing large quantities of products that are essentially copies of FDA-approved drugs.^[1] Genuine patient-specific compounding under a section of federal law known as Section 503A still exists, meaning a pharmacist can still compound a version of these drugs for an individual patient with a documented medical reason, such as an inability to tolerate an ingredient in the approved product.^[1] But the alert notes this is a narrower path than what many telehealth and compounding businesses built their operations around during the shortage years, and it flags that programs relying on standardized prescribing and broad marketing to large numbers of patients may face more legal scrutiny going forward.^[1]

What happens next

Both decisions were issued unpublished, meaning they are not designated as binding precedent for future cases, though the alert says district courts facing similar challenges should reach the same result absent different facts or legal theories.^[1] The alert advises pharmacies, telehealth companies, and other businesses that expanded compounded GLP-1 operations during the shortage to review their current prescribing, marketing, and distribution practices given the FDA's continued scrutiny of the space.^[1] No further appeal steps or specific dates are mentioned in the available sources.