Two Labs Blog

Two Labs Blog

The Basics of Licensing: In & Out, Drug, & Facility

Posted by Two Labs on January 5, 2018

When you conduct a quick online search using the following phrases, a vast array of answers will cross your screen:

  • "License a Drug or Facility"
  • "Pharma Licensing"
  • "How to start my own Pharma Company"

The results of these searches tend to center around licensing: in-licensing, out-licensing, drug licensing, and facility licensing. How does all of this relate to launching a drug? Here are the basics:



When you hear the term "in-licensing," simply think of the word "investor". In-licensing is the process of creating a contract that allows another firm to provide capital to the development and launch process, thus taking on financial responsibility. This is a very popular licensing process for small bio-pharma start-ups to get their drug off the ground. There are pros and cons to this type of licensing; for example, it can provide the capital a company needs, but then the profits need to be shared once the drug enters the market.



Out-licensing is more focused on opening up the delivery pipeline to assist you with getting your drug "out the door." Out-licensing encompasses finding a partnership, or partnerships, that will help identify your target market and assist you in getting your product into the right hands. This process may include working with marketing firms or legal firms. The financial relationship is very different in this type of licensing than the one outlined in the in-licensing section above.


Drug Licensing

Only one entity in the United States "licenses" a drug, and that is the Food and Drug Administration (FDA). The FDA must approve all drugs before they can enter the market, and consequently, FDA approval is paramount before the drug actually leaves your facility and heads to the patient.


Facility Licensing

Facility licensing may entail more than you would initially expect. Of course, if you are manufacturing your own drug, your facility must be inspected and licensed by the FDA. However, the state where your facility is located may also require a license which may or may not include an inspection. In addition to your resident state, there are other states that have requirements for a license, certification to do business, or deliver drugs within their borders. Each business location must have its own set of licenses. A company with multiple facilities may end up with dozens of facility licenses and only have one drug.

Do you have all the licenses you need?

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Topics: PharmaLicense

3 Entities That Can Change Your State Licensing Strategy

Posted by Two Labs on November 9, 2017
Pharmaceutical State Licensing ChangesIn the Pharmaceutical industry, licensing is never a static process. There are many changes that can alter your licensing strategy: 

1. Your Company

This one is pretty obvious. There are a number of different business changes that could direct the strategy of your licensing, or the maintenance of your state licenses. Some of the most common occurrences are: a change of business entity (i.e. LLC to INC), a change of officers, or moving. These are the more common instances, but there is a wide variety of scenarios that may affect your company's licensing strategy.  Remember, each state interprets business changes differently according to its own statutes.
Are you making any strategic business changes? Fill out this form and let us check to see if it will affect your Licensing.
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2. Contract Manufacturing Organization (CMO)

If your CMO moves, it might affect your state licensing more than you would expect. States are now asking for your CMO's license number on applications, and to provide a copy of the FDA's inspection report. If any pharmaceutical manufacturer opens a new facility, they have to go through the rigmarole of an FDA inspection all over again to get an updated license. This can adversely impact your licensing if the required states aren't updated with the change.

3. Third-Party Logistics Provider (3PL)

Similar to the CMO, if a 3PL changes locations or opens up a new location, this may alter your state licensing. The states vary on the requirement of a 3PL's license: several states allow a company to piggyback off of its 3PL's license, a handful require your 3PL's state license to be listed, and a few print the 3PL's location on your license. In each scenario, your 3PL's business activities may adversely change your state licensing strategy and the process of maintaining your state licensing.
If any of these situations sounds like something your company is faced with now or potentially in the future, contact the Two Labs PharmaLicense team and let us determine if your future plans will alter your licensing strategy.
Fill Out the Form Here
For more information about Two Labs, visit

Topics: 3PL, PharmaLicense

Consequences Pharmaceutical Companies Can Face for not Carrying the Correct State License and Being Noncompliant

Posted by Two Labs on October 20, 2017

Anyone who is engaged in manufacturing, preparing, propagating, compounding, processing, packaging, marketing, selling, shipping, repackaging, or labeling a prescription drug, or wholesale distribution of a prescription drug...must obtain a license/permit in certain states to be in compliance.

Discover the ins and outs of State Licensing

"But I didn't know!"

This is a response that is never accepted by a government agency for a pharmaceutical company's inaction to remain in compliance with state licensing.

In analyzing the costs of being compliant, remember these consequences for not carrying the correct state licenses and being noncompliant:

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  1. If you are found to be noncompliant by your resident state licensing board, you may have your business license suspended or revoked.

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  1. The state board, depending upon the infraction, may also impose civil penalties ranging from a flat fine (up to $250,000 in some states, such as North Carolina¹) to charging your company per violation or per day. At worst, there could be misdemeanor or felony criminal charges that include jail time.
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  1. Being punished by your resident state board may only be the beginning:
    1. Once you have come to a resolution with your resident state board, it must then be reported to all of the other state licensing boards.
    2. Your company could then go through the same board actions with other states you are licensed with, and incur more license revocations, fines, and criminal charges.

Once the dust settles from all of the boards, there is still one final hurdle to face: how will your company recover from license revocation?

Every state board application asks if your company was ever denied a license or faced disciplinary action. This could potentially prevent your company from continuing to do business without expensive alternate strategies.

As you can see, in the pharmaceutical industry, falling out of compliance with state boards can be very costly. Consequences can include anything from license suspension by multiple states, up to felony charges and time spent in jail. Is running your own company's risk for noncompliance worth it?

Let the state licensing experts at Two Labs help! To learn more about licensing and other important topics related to launching a pharmaceutical drug, subscribe to our blog below or request a free consultation from the Two Labs PharmaLicense experts.

Request a Free Consultation Today!

¹North Carolina Wholesale Prescription Drug Distributor Laws: Chapter 106 Article 12 A § 106-145.6.  Denial, revocation, and suspension of license; penalties for violations.

Topics: PharmaLicense

Why Compendia is More Than Just a Price Book

Posted by Alisha Nielsen on October 6, 2017

In the pharmaceutical industry, a "Price Book" is often synonymous with Compendia data. Even though physical publications were discontinued more than 15 years ago, people in the industry still use the term "Price Book." As somebody who has worked in the Compendia industry for more than 20 years, the continued use of this outdated term demonstrates that those in the pharma industry are missing the clinical importance of Compendia data.

What Is Compendia Data?

Don't get me wrong, pricing is an extremely important part of Compendia data, and "real-time pricing" has existed in at least 1 major Compendia for several years now. However, pharmaceutical manufacturers need to realize the importance of Compendia and why it is more than just a "Price Book."

Compendia data is the core data that feeds multiple areas with critical information:

Compendia data

The easiest way to understand Compendia’s significance is to think about your personal experience - if you’ve ever had a prescription filled, the process involved a reference to Compendia data. For instance, the literature you find stapled to the pharmacy bag includes Compendia data.  Another example is the drug allergy question your doctor asks when prescribing a new medication, which stems from Compendia data. All information and answers about prescription medications are sourced from Compendia.

In short: if a manufacturer's product is not listed in the Compendia databases, it can't be ordered, electronically prescribed or reimbursed. It's as if the drug does not exist in the marketplace.

To learn more about Compendia and how to have a successful product launch, visit, or email us at

Topics: Compendia, Pricing

Where do your Sales Reps turn when they have EHR issues?

Posted by David Ward on September 27, 2017
Electronic prescribing allows healthcare providers to manage prescriptions electronically, making prescriptions safe, convenient and fast (SureScripts).

But what if there's an issue with your new product launch?

Let’s say your new drug cannot be found on the EHR platform. Or your product prescribing data is not included in the listing. Considering the actual "launch" of your new product is the most critical moment in its lifecycle, these issues can debilitate the success of your new product right from the start.

So if you are a sales leader of a pharmaceutical organization, where do your sales reps turn when they encounter this debilitating issue in the EHR or ePrescribing platform? 

Methods of communication

Typically, we see clients handling these issues through what we call the "traditional" communication method, which looks like a game of telephone:

game of telephone.png

The method could take weeks if not months to resolve - if it's resolved at all - creating a domino effect of issues for your sales reps and the new product launch:

EHR - domino of badness.png

 The result = lost sales to the pharma manufacturer

What other options do sales leaders have to address the issue?

Although not effective, if sales leaders decide against the traditional method of communications, we see them either ignore the problem or let the sales rep navigate the EHR issues on their own. 

But we want sales leaders to take action. At Two Labs, our eRx Solutions team developed an iOS app to act as the new method of communication, allowing clients to: 

  1. Quantify the size of any EHR / ePrescribing issue in the field
  2. Report issues with the Health Care Provider to one of our eRx Specialists
  3. Focus on their clinical message, not an EHR / ePrescribing issue

The result = our client's product is available to prescribers in the EHR 

Since 2012, we helped resolve over 4,000 EHR and ePrescribing issues with 91% of those issues being resolved within 2 business days!

Request a free consultation with an eRx Solutions team member at Two Labs to find out how your salesforce can triage and resolve EHR / ePrescribing issues in less two days!

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Or visit us at

Topics: ePrescribing

Two Labs Marketing is Changing Its Name

Posted by Jessica Krauser on September 5, 2017

Two Labs Pharma Services Name Change

Two Labs Marketing is Now Two Labs

Two Labs Marketing, LLC is announcing our name change to Two Labs, LLC, a pharma services consulting company. To some it might sound like a small change, but to those who have been around Two Labs Marketing know that for over 14 years we have evolved into much more and we want our name to reflect that. Our company was established in 2003 with the idea to educate and train pharma product managers about the commercialization process. 

Since then, the Two Labs team consistently created new servic

es based on client needs:

  • PharmaLicense, LLC in 2007
  • Compendia expansion in 2009
  • eRx Solutions, LLC in 2013
  • Post-Launch Trade Management Services in 2013
  • Specialty Commercialization expansion in 2014
  • Patient (HUB) Services in 2016

Our name, Two Labs, allows us to brand all our services and affiliates under one umbrella in a more integrated, meaningful way.  For starters, every employee (PharmaLicense and eRx Solutions team included) will have a Two Labs email address. The second biggest change with any company rebranding is the website:

Learn More About Our Services

Our goal is to become a full pharma services consulting organization. The re-branding is just the beginning.  

Topics: Two Labs