FAQs About the Regulation of OTC Medicines

  1. What are over-the-counter (OTC) medicines? 
  2. How do OTCs differ from prescription (Rx) medicines?
  3. Which government agencies oversee the regulation of OTCs?
  4. Can OTC medicines be marketed without pre-approval from FDA?
  5. What is the NDA process?
  1. What are over-the-counter (OTC) medicines?

Over-the-counter (OTC) medicines are sold directly to consumers without a prescription. There are approximately 800 OTC active ingredients available today that constitute more than 100,000 OTC products in the healthcare marketplace. Like prescription drugs, OTC medicines are regulated by the U.S. Food and Drug Administration (FDA). Available at more than 750,000 retail outlets including pharmacies, convenience and grocery stores, or mass merchandisers, OTC medicines are safe and effective when used as directed and the Drug Facts label instructs consumers on how to properly choose and use them. OTCs treat many common ailments including pain, fever, cough and cold, upset stomach, and allergies. OTC medicines should not be confused with dietary supplements (vitamins, minerals, herbals, and botanicals) which have different rules.

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  1. How do OTCs differ from prescription (Rx) medicines?

There are two types of drugs in the U.S.: prescription and nonprescription (OTC). Both must be safe and effective for their intended use and approved by FDA. OTC medicines differ from Rx drugs in the following ways:

  • Margin of safety: Since their intended use is not supervised by a doctor or other prescriber, OTCs need to have a wider margin of safety than Rx drugs.
  •  Labeling: By law, OTC medicine labeling must include all the information that an ordinary consumer needs for the safe and effective use of the product. Drug Facts is the name given to the type of label format on the majority of OTCs.
  •  Advertising: FDA oversees Rx medicine advertising. In contrast, the U.S. Federal Trade Commission (FTC) has authority over OTC medicine advertising, just as it does for other consumer products. 
  •  Distribution: The majority of OTC medicines can be sold in any of the approximately 750,000 retail outlets in the United States—supermarkets, mass merchandisers, pharmacies, etc.—unlike Rx drugs which are limited to roughly 55,000 pharmacies.

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  1. Which government agencies oversee the regulation of OTCs?

FDA’s Center for Drug Evaluation and Research (CDER) is responsible for handling the review of OTC medicines. Specifically, CDER’s Office of Nonprescription Drugs takes primary responsibility for reviewing OTCs. However, other experts and agencies within FDA are often called upon to assist in the effort. FTC has authority in the area of OTC advertising, just as it does for other consumer products. The U.S. Consumer Product Safety Commission (CPSC) has authority in the area of child-resistant closures, found on many OTC products.

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  1. Can OTC medicines be marketed without pre-approval from FDA?

Yes. Any product that conforms to an OTC monograph may be manufactured and sold without an individual product license. A monograph is a regulatory standard for the labeling and ingredients for products within a specific category such as antacids, analgesics, etc. It is a kind of “recipe book” covering acceptable ingredients, doses, formulations, indications, and labeling. Final monographs are published in the government’s Code of Federal Regulations (CFR). Some OTC medicines do not fall within the monograph system and require a new drug application (NDA).

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  1. What is the NDA process?

The NDA process is the route taken by manufacturers to request FDA’s approval of a new drug for sale and marketing in the U.S. as specified in the Federal Food, Drug, and Cosmetic Act of 1938.

The goals of the OTC NDA process are to provide enough information to permit an FDA reviewer to determine: 1) whether the drug is safe and effective in its current state and whether the benefits of the drug outweigh the risks; 2) whether the drug’s proposed labeling is adequate; and 3) whether the methods used in manufacturing are adequate to preserve the drug’s identity, strength, quality, and purity.

After an NDA application is received by FDA, it must first be deemed worthy of a formal review. The information is then forwarded on to a team of reviewers such as physicians, chemists, pharmocokineticists, and statisticians who examine the data submitted for accurateness. FDA also may elect to call on its advisory committees for additional review and recommendations.

During the review of an NDA, CDER usually also communicates with the NDA applicant, or the sponsor, regarding a variety of procedural issues. In some cases, the applicant may submit new data to the NDA, which may result in a time extension for the application.

Once FDA determines that the application information is complete and acceptable (including labeling information and manufacturing inspections), the reviewers and their supervisors reach an approval recommendation. Once the division director signs an approval action letter, the product can be legally marketed starting that day in the United States.

More information on the NDA process is available at on FDA's website.

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