There are advantages to compounding, many of which providing patients pharmaceuticals that have been personalized to match their particular needs when commercially available pharmaceuticals fall short of supply.

Medical needs frequently necessitate compounding; for example, some patients need a certain non-essential ingredient to be eliminated from their pharmaceutical to prevent an allergic reaction. Others require compounded medication in order to obtain a precise dosage level that is specific to their own personal needs and may not be offered by commercially accessible medications.

Additionally, compounding pharmacies are employed for less mandatory purposes. Patients frequently require their pharmaceuticals in alternative forms. For instance, if a little child or elderly patient has trouble takingtheir dose in capsule form; however, a compounding pharmacy can give the same prescription in syrup or solution form for simpler administration, or in a cream base form so the patient can apply the medication topically. Pharmaceutical compounding is also used to alter the flavor and appearance of prescriptions in order to improve patient compliance and aesthetic appeal, particularly in the case of children and elderly patients.

Compounded medications are ordered by a licensed physician, veterinarian or other prescriber, and must be mixed in a safe and carefully controlled environment by a licensed compounding pharmacist.

All pharmacies used to be compounding pharmacies. It was typical for a pharmacist to utilise his or her expertise to prepare medications for a specific patient, in a specific form that suited the patient's particular medical requirements, using the best standards at the time. The mass manufacture of pharmaceuticals brought about by pharmacy modernisation quickly rendered the position of the compounding pharmacist obsolete and reduced it to that of a dispenser. Many produced pharmaceuticals now are "one-size-fits-all," which doesn't address the specific needs of some patients.

When a patient has an allergy to a certain preservative, colour, or binder present in commercially accessible medications, pharmacy compounding may be their only alternative. Additionally, when a different dosage that is not sold commercially is required for treatment (like for infants, children, elderly or pets) or when flavouring the medicine is necessary to make it more acceptable for some patients, particularly kids. When taking a medication in the shape of a tablet is not an alternative, it can be be turned into a cream, liquid, or suppository (i.e. patients with mouth ulcers, in hospice, etc.)