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Returns Industry/Reverse Distributor


Manufacturers, in an effort to encourage hospitals and pharmacies to purchase their new drugs, may offer to buy back certain drugs the pharmacy or hospital is not able to sell or use. The returns industry (or reverse distribution) was created to facilitate the return of unused or expired drugs to the manufacturer for credit.

The EPA determined, in letters written in 1981 and 1991, that an expired/unused drug remains a product until the decision is made to dispose of it. Therefore, if a medical facility hires a reverse distributor to manage its unused/expired pharmaceuticals, it can ship them as products using commercial carriers or mail-in services, and potentially receive credit for them. Because it is a product, it is not a hazardous waste at this point. Once the products reach the reverse distributor, it is then determined which drugs are eligible for credit and which will be discarded. It is at this point that the pharmaceuticals not eligible for credit become waste.

The EPA made it very clear in both letters that the returns industry is not to be used as a “waste management system.” It is the hospital’s or pharmacy’s responsibility to identify spilled, broken or “waste-like” items and to manage those as waste, including determining if they meet the criteria for hazardous waste under EPA’s RCRA regulations. Companies that provide other services, such as the pick up of infectious waste, might offer reverse-distribution services but must be careful to not confuse their disposal services with reverse distribution.

Some reverse distributors and other waste companies offer a “destruction only” service. This fits within the Drug Enforcement Administration’s definition of reverse distribution, but in the world of waste management, we would see this as waste disposal. We are working with the federal government and these companies to help them understand how the different services they provide are regulated. You need to know what service a certain company is offering you and how that service is regulated.

The returns industry is economical for institutions, such as hospitals and pharmacies, that purchase pharmaceuticals through a full-line drug wholesaler and/or use larger quantities of pharmaceuticals. Different reverse distributors offer different services; be sure to determine what service you are getting and that the reverse distributor is in compliance with their local authorities to offer that service.

To find a reverse distributor, contact the company you purchase drugs from to see if they work with a reverse distributor currently. The Returns Industry Association also lists their members on their web page.

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Resources:

DEA's definition of reverse distributor  http://www.deadiversion.usdoj.gov/fed_regs/rules/2003/fr0711.htm 
King County Interagency Regulatory Analysis Committee's Resource Directory    http://apps01.metrokc.gov/govlink/hazwaste/business/wastedirectory/wastedetails.cfm?wasteid=129