If you operate an online or mail-order pharmacy, your business must be properly licensed to operate legally in every state where orders are placed. However, the requirements or issuing authority for the appropriate licenses vary by state.
In this article, we explore the process for obtaining an online or mail-order pharmacy license, how non-resident state requirements differ from those of your domestic state, and the consequences of non-compliance.
As with traditional pharmacy businesses, online and mail-order pharmacies requires certain licenses in order to legally operate.
Any business that dispenses medications and controlled substances is subject to federal and state regulations. There are licensing requirements that must be met in your home or formation state. In addition, you are subject to regulations to those states in which your online or mail-order pharmacy sells to.
There are strict penalties for pharmacy licensing non-compliance. If you fail to obtain or renew the appropriate licenses, you may be subject to fines, revocation of a license, denial of a future license, and harsher penalties. For example, if you dispense controlled substances without the proper licenses and/or registrations, you could face criminal prosecution.
Pharmacies are highly regulated at both the federal and state levels. To become properly licensed for your online or mail-order pharmacy business, you must first obtain a resident or in-state pharmacy license in the state where your business is domiciled. In some states, your business may be required to have a registered Pharmacist in Charge (PIC) or a Pharmacy Manager. There may be additional licensing requirements depending on the jurisdiction and/or type of service or product you plan to provide. For example, compounded prescriptions and durable medical equipment generally have their own, separate licensing requirements. Many states also require a controlled substance license if you are dispensing certain medications.
There are registration and/or licensing requirements that need to be met a the federal level. You may also need to obtain a license in every additional state where you do business. Depending on the state, this is known as a non-resident pharmacy license or mail-order pharmacy license.
State licenses can typically be obtained from the state board of pharmacy or similar public health department and are generally processed within 10 days to three months. The licenses must also be renewed annually or be subject to annual reporting.
Remember: A license in your domestic state is a prerequisite for all non-resident pharmacy licenses.
For more information, see Pharmacy business license requirements.
All states require online or mail-order pharmacies to have a non-resident pharmacy license in the states they are shipping to. One exception is Massachusetts, which currently does not offer out-of-state licenses, except for outsourcing facilities. (As long as your non-resident business is in good standing and has a current resident or in-state pharmacy license, you can ship or deliver medications to Massachusetts.)
The process of obtaining a non-resident pharmacy license is similar to the domestic state pharmacy licensing process. One difference in the process is that you may be required to designate a domestic state representative to act as an agent for service of process. This step often requires foreign qualification (aka business registration) in that state. This ensures your business is formally registered in a state other than your formation or domestic state.
All non-resident pharmacy licenses require the pharmacy to be properly licensed in its domestic state.
It’s important to note that non-resident pharmacy license rules vary by state. In certain states, a pharmacist-in-charge (PIC) may need to be licensed through their board of pharmacy. Others require that non-resident pharmacies file reports of controlled substances that are dispensed to residents.
Another challenge is that regulations are always changing. It’s important to stay current on online and mail-order pharmacy licensing requirements, as well as other regulatory updates that affect the business.
Managing compliance obligations, particularly online and mail-order pharmacy license applications and renewals, amidst ever-changing regulations should occupy an important part of your company’s day-to-day operations. Keeping track of renewal dates, fees, and necessary documents can be complicated and time-consuming.
CT Corporation can help you navigate the pharmacy industry’s uniquely complex regulatory and licensing challenges.
Contact us today to learn more about how CT Corporation can help you manage your pharmacy license needs.
