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Drug Distributor Accreditation Criteria

Click on the links below to learn about each criterion.

Drug Distributor Accreditation defines “wholesale distributor” as a business (other than a manufacturer, a manufacturer’s co-licensed partner, a third-party logistics provider, or a repackager) engaged in wholesale distribution (as defined in Section 503(e)(4) and amended by the Drug Supply Chain Security Act).

For all business entities that are not wholesale distributors, additional criteria must be followed. Please refer to the Information for Nontraditional Business Models section for the additional criteria the applicant or accredited facility must comply with.

Licensure

Qualifying wholesale distributors shall provide information to verify that:

  1. The wholesale distributor that provides services within a state, whether it is located within or outside of the state, is licensed or registered, in good standing, or eligible to become licensed or registered in wholesale drug distribution in all applicable jurisdictions. At least annually, a wholesale distributor and a third-party logistics provider must report to United States Food and Drug Administration, pursuant to federal law.
  2. The wholesale distributor complies with all applicable drug and device statutes including, but not limited to, regulations governing wholesale distribution where licensed or registered and complies with the more stringent law or regulation as determined by conflicts of law rules.
  3. If the wholesale distributor is involved in the distribution of controlled substances, including substances that have been identified as “listed chemicals” regulated under the Controlled Substances Act, it is duly registered with United States Drug Enforcement Administration and the appropriate state controlled substance agency and must comply with all applicable laws and rules for the storage, handling, reporting, monitoring, transport, shipment, and distribution of controlled substances and such precursor substances.
  4. The wholesale distributor has a person to serve as the facility manager or designated representative for the wholesale distributor facility who is actively involved in and aware of the actual daily operation of the wholesale distributor that engages in the distribution of prescription drugs and/or prescription devices and, if required, shall be licensed or registered with the board of pharmacy or appropriate state regulatory agency.
  5. The wholesale distributor does not engage in the wholesale distribution of prescription drugs that are purchased or received from pharmacies, practitioners, or from wholesale distributors that obtained them from pharmacies or practitioners, either directly or indirectly. The wholesale distributor may receive prescription drugs returned from pharmacies or practitioners that were distributed by the wholesale distributor. A wholesale distributor that operates solely as a reverse distributor may receive prescription drugs from pharmacies and practitioners, regardless of where they were obtained, for destruction in accordance with applicable laws and regulations. The prescription drugs may also be returned to the manufacturer or agent authorized by the manufacturer to accept returns on the manufacturer’s behalf.

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Facility

Qualifying wholesale distributors shall provide information to verify that:

  1. The facility at which drugs and/or devices are received, stored, warehoused, handled, held, offered, marketed, displayed, or transported from shall:
    1. Be of suitable construction to ensure that all drugs and/or devices in the facility are maintained in accordance with the labeling of such prescription drugs and/or prescription devices or in compliance with official compendium standards such as the United States Pharmacopeia – National Formulary.
    2. Be of suitable size and construction to facilitate cleaning, maintenance, and proper wholesale distribution operations;
    3. Have appropriate storage areas to provide adequate lighting, ventilation, temperature, sanitation, humidity, space, equipment, and security conditions:
      1. All drugs and/or devices shall be stored at appropriate temperatures and under appropriate conditions in accordance with requirements, if any, in the labeling of such drugs and/or devices or in accordance with the requirements in the current edition of an official compendium such as the United States Pharmacopeia – National Formulary.
      2. Documentation of facility assessments, such as temperature mapping, or alternative processes will be maintained by the wholesale distributor to demonstrate the ability to properly store prescription drugs in accordance with the labeling of the drug or the official compendium, such as United States Pharmacopeia – National Formulary.
      3. If no storage requirements are established for a drug, the drug may be held at “controlled” room temperature, as defined in an official compendium, such as United States Pharmacopeia – National Formulary, to help ensure that its identity, strength, quality, and purity are not adversely affected and/or considered adulterated. 
      4. Appropriate electromechanical, or electronic temperature and humidity recording equipment and/or logs, shall be utilized to document proper storage of drugs and/or devices. Temperature and humidity monitoring and recording systems will operate continuously.
    4. Have a quarantine area for storage of drugs and/or devices that are outdated, damaged, deteriorated, misbranded, adulterated, counterfeit, or suspected of being counterfeit, otherwise unfit for distribution, or that are in immediate or sealed secondary containers that have been opened. The quarantine area must accommodate suspect and illegitimate product as outlined in Section 582 of the Federal Food, Drug, and Cosmetic Act.
    5. Be maintained in a clean and orderly condition.
    6. Be free from infestation of any kind.
    7. Not be a personal residence.
  2. Appropriate security, accountability, and inventory controls are maintained to deter, detect, and document any criminal activity, including theft, counterfeiting, or diversion of drugs and/or devices.
  3. Controlled substance drugs are isolated from non-controlled substance drugs and stored in a secure area in accordance with Drug Enforcement Administration security requirements and standards.
  4. Adequate security for the facility has been provided for:
    1. All facilities used for wholesale drug distribution shall be secure from unauthorized entry.
    2. Access from outside the premises shall be kept to a minimum and well controlled.
    3. The outside perimeter of the premises shall be well lit.
    4. Entry into areas where drugs and/or devices are held shall be limited to authorized personnel.
    5. All facilities must be equipped with an alarm system to detect entry after hours.
    6. All facilities must be equipped with a security system that will provide suitable protection against theft and diversion. When appropriate, the electronic inventory management system shall provide protection against theft or diversion that is facilitated or hidden by tampering with or altering computer or electronic records.
  5. Wholesale distributor facilities co-located with another business shall maintain processes and systems for separating and securing all aspects of the operation. Co-location with another business authorized to purchase prescription drugs shall comply with federal and state licensing requirements, and the records of wholesale distribution must provide a clear audit trail that distinguishes all purchases and distributions of the wholesale distributor under its license from those made under any other license.

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Personnel

Qualifying wholesale distributors shall provide information to verify that:

  1. The wholesale distributor’s designated representative or facility manager have not been enjoined, disciplined, fined, or punished for violating any federal or state laws regulating prescription drugs and/or prescription devices.
  2. The wholesale distributor’s designated representative or facility manager have not been found guilty, pled guilty, or pled nolo contendere to any criminal offense. 
  3. The wholesale distributor’s designated representative or facility manager:
    1. Has a minimum of two years of verifiable full-time managerial or supervisory experience in a pharmacy or wholesale distributor where the responsibilities included, but were not limited to, record keeping, storage, and shipment of prescription drugs and/or prescription devices.
    2. Serves as the designated representative or facility manager for only one prescription drug and/or prescription device facility at any one time.
    3. Is actively involved in and aware of the actual daily operations of the wholesale distributor.
    4. Is employed full-time in a managerial position by the wholesale distributor.
    5. Is physically present at the wholesale distributor during normal business hours, except for time periods when absent due to illness, family illness or death, scheduled vacation, or another authorized absence; in the authorized absence of the designated representative or facility manager, personnel employed by the wholesale distributor with knowledge of the operation and appropriate education and/or experience are to assume responsibility.
    6. Is aware of, and knowledgeable about, all policies and procedures pertaining to the operations of the wholesale distributor.
  4. All personnel actively engaged in or who directly supervise the operation and handling of prescription drugs and/or prescription devices, which may include the owner(s) and/or chief executive officer, management, officers, and other key personnel, prior to their association, employment, or contracting and regularly thereafter, have met the following qualifications:
    1. Appropriate local and national criminal background checks.
    2. Appropriate education, experience, and training necessary to safely and lawfully engage in the wholesale distribution of prescription drugs and/or prescription devices.
  5. All personnel with access to controlled substances, which may include the owner(s) and/or chief executive officer(s), management, officers, and other key personnel, are subject to toxicology screenings prior to their association, employment, or contracting, and are subject to pre-employment, for-cause, and random toxicology screening, as warranted.
  6. The wholesale distributor maintains and enforces policies and procedures requiring documentation of responsible persons and persons-in-charge, including such persons’ titles, duties, and qualifications.
  7. The wholesale distributor maintains and enforces policies and procedures that ensure the qualifications described in 3. and 4. above are documented and retained.
  8. Qualifying wholesale distributors shall provide information to verify that, prior to the initial wholesale distribution or acquisition of prescription drugs to or from any wholesale distributor, the distributing or acquiring wholesale distributor requires all common carriers contracted with or utilized by the wholesale distributor to require its employees whose responsibilities include the handling of prescription drugs to undergo criminal background checks, initial and random toxicology screenings, and security training.

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Record Keeping

Qualifying wholesale distributors shall provide information to verify that:

  1. The wholesale distributor is establishing and maintaining inventories and records of all transactions regarding the receipt and distribution or other disposition of all prescription drugs and/or prescription devices. These records shall include the following:
    1. Appropriate information and data to identify the source and the type of drugs and/or devices being received or distributed.
    2. All records related to the wholesale distribution of prescription drugs, including but not limited to, invoices of purchase, packing slips, shipping records, and sales invoices, which will accurately reflect the name of the wholesale distributor as it appears on the facility’s license issued by the state in which the wholesale distributor is engaged in wholesale distribution. 
    3. Wholesale distributors to whom a license has been issued in the same name and at the same address as another licensee authorized to purchase prescription drugs must utilize a method to distinguish purchases and distributions that are specific to the wholesale distributor.
  2. Inventories and records shall be made available for inspection and photocopying by any authorized official of any state, federal, or local government agency for a period of three years following their creation date, or as otherwise required by law.
  3. Facilities that take ownership of a product (eg, manufacturers, repackagers, wholesale distributors, and dispensers’ affiliated warehouses or distribution centers of such entities under common ownership and control that do not act as a wholesale distributor) must establish and maintain systems and processes to comply with federal law for verification and traceability data required and described by Sections 582 of the Federal Food, Drug, and Cosmetic Act. Records relating to these requirements must be maintained for six years.
  4. Records described in this section are readily available for inspection during the retention period. Records kept at a central location must be available for inspection within two working days of a request.
  5. The wholesale distributor must maintain a current list of all persons and businesses with which it conducts business, including sources, customers, security, common carriers, housekeeping, pest control, and other services.
  6. The wholesale distributor shall establish and maintain a system for mandatory reporting of the following:
    1. Prescription drug and/or prescription device shortages, significant losses, or suspected criminal activity to the board of pharmacy or appropriate state regulatory agency, local law enforcement, and appropriate federal agency, such as Drug Enforcement Administration or Food and Drug Administration.
    2. Manufacturers, wholesale distributors, and repackagers must provide illegitimate product notifications to Food and Drug Administration and trading partners, pursuant to federal law.
  7. The wholesale distributor has adequate processes in place for monitoring the purchase activity of customers and identifying ordering patterns that identify potential diversion or criminal activity in accordance with state and federal law for controlled substances and “listed chemicals.” This requirement also applies to other prescription drugs known by the wholesaler to be subject to diversion or criminal activity, such as non-controlled pain medication, lifestyle drugs, short supply drugs, and drugs with a high potential for diversion.
  8. Prescription drug and prescription device records, data, and documents are securely stored, access is restricted, and policies and procedures have been implemented to protect the integrity of such records, data, and documents.

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Authentication and Verification

Qualifying wholesale distributors shall maintain and enforce policies and procedures that:

  1. Ensure the integrity, legitimacy, and authenticity of prescription drug and prescription device purchase orders and/or requests.
  2. Establish a process that ensures the verification of vendor and customer licenses using data from appropriate state and federal agencies, at least annually.
  3. Ensure the regular verification of the identity, legitimacy, and proper operation of entities seeking to sell or purchase prescription drugs and/or prescription devices. If the facility receives, purchases, stores, handles, sells, or distributes Drug Supply Chain Security Act-defined prescription drug products, the facility must initially and thereafter verify that trading partners are authorized pursuant to federal law.
  4. Ensure prescription drug and prescription device suppliers are engaged in the lawful distribution of prescription drugs and prescription devices obtained from legitimate sources. This includes an understanding of the vendor’s sources of prescription drugs and prescription devices assurance that the vendor will provide prescription drugs and prescription devices obtained from lawful sources.
  5. Authorized trading partners are subject to the verification requirements under federal law, which include provisions for promptly investigating and validating any products in the possession of the manufacturer, repackager, wholesale distributor, or dispenser in response to a suspect product determination.
  6. Ensure that upon receipt, each shipping container shall be visually examined for identity and to determine if it may contain contaminated, contraband, counterfeit, suspected of being counterfeit, damaged drugs or devices, or drugs or devices that are otherwise unfit for distribution, including examination for a suspect product pursuant to federal law. This examination shall be adequate to reveal container damage that would suggest possible contamination, adulteration, misbranding, counterfeiting, suspicion to being counterfeit, or other damage to the contents.
  7. Ensure that the drugs and/or devices found to be unacceptable under these criteria are quarantined from the rest of the stock until it is determined that the drugs and/or devices are not outdated, damaged, deteriorated, misbranded, counterfeited, or adulterated, and they are further determined to be fit for human use. This includes the quarantine and reporting of suspect and illegitimate product in accordance with federal law.
  8. Ensure that each outgoing shipment shall be carefully inspected for the identity of the prescription drugs and/or prescription devices and to ensure that there is no delivery of drugs and/or devices that have been damaged in storage or held under improper conditions.

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Returned, Damaged, and Outdated Drugs

Qualifying wholesale distributors shall maintain and enforce policies and procedures that incorporate items 1. through 6. below and include provisions under federal law for manufacturers, wholesale distributors, and repackagers to quarantine suspect and illegitimate product, maintain records relating to illegitimate product determinations for not less than six years, and provide illegitimate product notifications to Food and Drug Administration and trading partners:

  1. Ensure that any drug or device that is outdated, damaged, deteriorated, misbranded, counterfeited, suspected of being counterfeited, adulterated, or otherwise deemed unfit for human use be quarantined and physically separated from other drugs and devices until it is returned to either the manufacturer or wholesale distributor from which it was acquired, or the destruction of the drug or device is authorized.
  2. Ensure that the disposition of prescription drugs sent for destruction is documented and proof of destruction, such as a certificate of destruction, is received and maintained by the wholesale distributor for inventory accountability, except when transferring drugs to the manufacturer of that product or to a reverse distributor at the direction of the manufacturer of that product.
  3. Ensure that when drugs and devices are adulterated, misbranded, tampered, counterfeited, or suspected of being counterfeit, notice of the adulteration, misbranding, tampering, counterfeiting, or suspected counterfeiting shall be provided to the board of pharmacy or appropriate state regulatory agency, the appropriate federal regulatory agency, eg, Food and Drug Administration or Drug Enforcement Administration (if a controlled substance), and the manufacturer or wholesale distributor from which they were acquired within three business days. Any prescription drug product considered to be a suspect or illegitimate product shall be processed and handled in accordance with federal law, including quarantine, notice, sampling, records, release, and disposition. Any drug and/or device returned to a manufacturer or wholesale distributor shall be kept under proper conditions during storage, handling, transport, and shipment, and documentation showing that proper conditions were maintained shall be provided to the manufacturer or wholesale distributor to which the drugs are returned.
  4. Ensure that when any drug or device whose immediate or sealed outer or secondary containers or labeling are adulterated, misbranded, tampered, counterfeited, or suspected of being counterfeit, it shall be quarantined and physically separated from other drugs or devices until it is returned to either the manufacturer or wholesale distributor from which it was acquired or destroyed. Any prescription drug product considered to be a suspect or illegitimate product shall be processed and handled in accordance with federal law, including quarantine, notice, sampling, records, release, and disposition. When the immediate or sealed outer or secondary containers or labeling of any drug or device are adulterated, misbranded, tampered, counterfeited, or suspected of being counterfeit, notice of said conditions shall be provided to the board of pharmacy or appropriate state regulatory agency, the appropriate federal regulatory agency, eg, Food and Drug Administration or Drug Enforcement Administration (if a controlled substance), and the manufacturer or wholesale distributor from which it was acquired within three business days, or as otherwise required by law.
  5. Ensure that when any drug or device that has been opened or used, but is not adulterated, misbranded, tampered, counterfeited, or suspected of being counterfeit, it shall be identified as such, and shall be quarantined and physically separated from other drugs or devices until it is returned to the manufacturer or wholesale distributor from which acquired or it is destroyed. Any prescription drug product considered to be a suspect or illegitimate product shall be processed and handled in accordance with federal law, including quarantine, notice, sampling, records, release, and disposition.
  6. Ensure that if the conditions under which a prescription drug or prescription device has been returned cast doubt on the drug’s or device’s safety, identity, strength, quality, or purity, then the drug or device shall be destroyed, or returned to the supplier, unless examination, testing, or other investigation proves that the drug or device meets appropriate standards of safety, identity, strength, quality, and purity. In determining whether the conditions under which a prescription drug and/or prescription device has been returned cast doubt on the drug’s or device’s safety, identity, strength, quality, or purity, the wholesale drug distributor shall consider, among other things, the conditions under which the drug and/or device has been held, stored, or shipped before or during its return and the condition of the prescription drug and/or prescription device and its container, carton, or labeling as a result of storage or shipping.

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Policies and Procedures

Qualifying wholesale distributors shall maintain, enforce, and adhere to written policies and procedures, which shall be followed for:

  1. The receipt, security, storage, accountability, inventory, transport, shipping, and distribution of prescription drugs and/or prescription devices, including policies and procedures for identifying, recording, and reporting significant losses or criminal activity or for correcting all errors and inaccuracies in inventories, and for ensuring the oldest active stock of a prescription drugs and/or prescription devices is distributed first.
  2. Wholesale distributors shall include in their written policies and procedures the following:
    1. A process to be followed for handling recalls and written market withdrawals of prescription drugs and/or prescription devices.
    2. Any volunteer action by the manufacturer to remove defective or potentially defective prescription drugs and/or prescription devices from the market.
    3. Any action undertaken to promote public health and safety by the replacement of existing merchandise with an improved item or new package design.
    4. In accordance with the Federal Food, Drug, and Cosmetic Act:
      1. Product tracing;
      2. Authorized trading partners;
      3. Verification; and
      4. Wholesaler and third-party logistics provider reporting.
  3. To prepare for, protect against, and handle any crisis that affects the security or operation of any facility in the event of a strike, fire, flood, or other natural disaster, or other situations of local, state, or national emergency.
  4. To ensure that any outdated prescription drugs and/or prescription devices shall be segregated from other drugs and either returned to the manufacturer or destroyed in accordance with federal and state laws, including all necessary documentation and the appropriate witnessing. This process shall provide for written documentation of the disposition of outdated prescription drugs and/or prescription devices. This documentation shall be maintained for three years after the disposition of the outdated drugs and/or devices.
  5. A process for disposing of and destroying containers, labels, and packaging to ensure that the containers, labels, and packaging cannot be used in counterfeiting activities, including all necessary documentation, maintained for a minimum of three years, and the appropriate witnessing of the destruction of any labels, packaging, immediate containers, or containers in accordance with all applicable federal and state requirements.
  6. A process for investigating discrepancies involving the following:
    1. Counterfeit, suspected of being counterfeit, tampered, contraband, or suspected of being contraband prescription drugs and/or prescription devices in the inventory and reporting such discrepancies within three business days to the board of pharmacy or appropriate state regulatory agency and the appropriate federal agency;
    2. Suspect product and conducting investigations; and
    3. Notifications to Food and Drug Administration and trading partners of illegitimate product determinations pursuant to verification provisions under the Federal Food, Drug, and Cosmetic Act.
  7. A process for reporting criminal or suspected criminal activities involving the inventory of drugs and devices to the board of pharmacy or appropriate state regulatory agency, local law enforcement, and appropriate federal agency within three business days, or sooner if required by law.
  8. A process for verifying security provisions of common carriers.
  9. A process for maintaining a quality management program that monitors critical operations and tracks trends for improvement.

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Information for Nontraditional Business Models

In addition to the criteria for wholesale distributors, the nontraditional business models must also comply with the following criteria:

  1. Third Party Logistics Provider:
    1. Drug Distributor Accreditation defines a third-party logistics provider as an entity that provides or coordinates warehousing, or other logistics services of a product in interstate commerce on behalf of a manufacturer, wholesale distributor, or dispenser of a product, but does not take ownership of the product, nor has responsibility to direct the sale or disposition of the product.
    2. Any third-party logistics provider seeking and maintaining Drug Distributor Accreditation may distribute only on behalf of:
      1. Food and Drug Administration-registered manufacturers, or
      2. NABP-accredited drug distributors, or
      3. Drug distributors that purchase the third-party logistics provider-distributed prescription drugs and/or prescription devices directly from the manufacturer, and
      4. Drug distributors that possess licenses in all states into which the third-party logistics provider will distribute its product.
      5. For requirements 3. and 4. in this subsection, the third-party logistics provider is required to demonstrate how it determines the requirements are met by its sources (ie, businesses for which the third-party logistics provider performs services).
  2. Manufacturer:
    1. Drug Distributor Accreditation defines a “manufacturer” as the following:
      1. A business that holds an application approved under Section 505 or a license issued under Section 351 of the Public Health Service Act for such product, or if such drug is not the subject of an approved application or license, the business that manufactured the drug;
      2. A co-licensed partner of the business described in subparagraph (2.1.1) that obtains the prescription drug and/or prescription device directly from the business described in this subparagraph or subparagraph (2.1.1) or (2.1.3); or
      3. An affiliate of the business described in subparagraph (2.1.1) or (2.1.2) that receives the prescription drug and/or prescription device directly from the business described in this subparagraph or subparagraph (2.1.1) or (2.1.2).
  3. Virtual Manufacturer:
    1. Drug Distributor Accreditation defines a “virtual manufacturer” as:
      1. A business that holds an application approved under Section 505 or a license issued under Section 351 of the Public Health Service Act for such product, or if such drug is not the subject of an approved application or license, the business that manufactured the drug;
      2. A co-licensed partner of the business described in subparagraph (3.1.1) that obtains the prescription drug and/or prescription device directly from the business described in this subparagraph or subparagraph (3.1.1) or (3.1.3); or
      3. An affiliate of the business described in manufacturer subparagraph (3.1.1) or (3.1.2) that receives the prescription drug and/or prescription device directly from the business described in this subparagraph or subparagraph (3.1.1) or (3.1.2); and
      4. A manufacturer that distributes prescription drugs but never physically possesses the prescription drug. 
    2. Any Drug Distributor Accreditation applicant or accredited facility whose business model is a virtual manufacturer must:
      1. Utilize an NABP-accredited drug distributor third-party logistics provider for distribution; and
      2. Sell or transfer ownership from a licensed location.
  4. Virtual Wholesale Distributor:
    1. Drug Distributor Accreditation defines “virtual wholesale distributor” as a business (other than a manufacturer, a manufacturer’s co-licensed partner, a third-party logistics provider, or a repackager) engaged in the wholesale distribution (as defined in Section 503(e)(4), as amended by the Drug Supply Chain Security Act), but does not physically possess the prescription drug.
    2. Any Drug Distributor Accreditation applicant or accredited facility whose business model falls within this definition, in full or in part, must:
      1. Utilize an NABP-accredited drug distributor third-party logistics provider for distribution; and
      2. Purchase either directly from an Food and Drug Administration-registered manufacturer and/or from an accredited drug distributor that purchased the drug directly from the manufacturer.
  5. Outsourcing Facility:
    1. Drug Distributor Accreditation defines “outsourcing facility” as a compounding facility that elects to register with Food and Drug Administration as an outsourcing facility, compounds at least one sterile preparation, and complies with Section 503B of the Federal Food, Drug, and Cosmetic Act. Prior to applying for Drug Distributor Accreditation, an outsourcing facility must meet all of the following conditions:
      1. Must be the recipient of an inspection from a state or federal regulatory agency that occurred subsequent to registration with Food and Drug Administration that indicates compliance with current Good Manufacturing Practices and required provisions of the Federal Food, Drug, and Cosmetic Act.
      2. Must have no open Food and Drug Administration actions or must be able to substantiate ongoing communication with Food and Drug Administration towards resolution; this includes unresolved 483s, warning letters, or recalls.
      3. Must not be the subject of serious Food and Drug Administration regulatory actions or any criminal investigation prior to registration.
      4. Must ship in accordance with their home state’s (and states to which they ship product) current licensing requirements for outsourcing facilities (pharmacy, wholesaler, or both).
  6. Reverse Distributor:
    1. Drug Distributor Accreditation defines “reverse distributor” as a facility that dispositions or otherwise processes saleable or nonsaleable prescription items received from a customer such that the prescription item may be processed for credit to the purchaser, manufacturer, or seller or disposed of.
    2. To seek and obtain Drug Distributor Accreditation, a reverse distributor must receive an itemized inventory similar to what is required for Drug Enforcement Administration §1304.22 for all packages of incoming prescription drugs and/or prescription devices subject to the accreditation. Partial container amounts of prescription drugs can be estimated using the same requirements per Drug Enforcement Administration §1304.22 controlled substance Schedule III-V drugs.
  7. Wholesale Distributor Co-Located With a Health Care Provider:
    1. Drug Distributor Accreditation defines “health care provider” as a hospital, pharmacy, clinic, practitioner, or provider that can lawfully purchase, dispense, and/or administer prescription drugs.
    2. A wholesale distributor that is co-located with a health care provider will be subject to additional scrutiny, potentially requiring the submission of additional documentation to demonstrate they are in compliance with state and federal laws and Drug Distributor Accreditation criteria. This might lengthen the time it takes to become accredited.
    3. The health care provider cannot meet the definition of a public or private hospital pharmacy or other health care entity.
    4. The health care provider must comply with state record keeping and audit trail laws for prescription drugs, including authorized trading partners and transaction documents.
    5. The wholesale distributor and health care provider must have physical separation adequate for securing prescription drugs.
    6. The wholesale distributor and health care provider transactions must employ separate account numbers to distinguish prescription drug purchases made by the two entities.
    7. The wholesale distributor cannot sell prescription drugs that were at any time purchased by a health care provider. Specifically, a wholesale distributor that has a license issued in the same name and address as a health care provider cannot sell prescription drugs purchased under the health care provider’s account.
    8. A health care provider purchasing prescription drugs as part of a Group Purchasing Organization or certain programs, such as the federal 340B Drug Pricing Program, must demonstrate they are not limited in the use of prescription drugs purchased under these contracts.

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History of Criteria Revisions

August 2006: Criteria updated to reflect amendments to the NABP Model Rules for the Licensure of Wholesale Distributors.

April 2009: Criteria updated to reflect amendments to the NABP Model Rules for the Licensure of Wholesale Distributors, addressing use of common carriers.

February 2013: Criteria updated pursuant to the recommendations of the Task Force on Virtual Manufacturers and Virtual Wholesale Distributors.

June 2015: Criteria updated to reflect changes to Food and Drug Administration’s Drug Supply Chain Security Act.

November 2017: Criteria updated to further clarify requirements for Virtual Manufacturers and Virtual Distributors.

December 2025: Criteria updated to remove liability insurance requirement; removed transaction history and replaced with requirements in Section 582; further clarified requirements for non-traditional business models, Drug Enforcement Administration reporting, and toxicology requirements; and modified technical language.

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