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When it comes to cosmetics, ‘medical grade’ is an unregulated term. There are no standards or federal guidelines by the U.S. Food and Drug Administration (FDA) that determines a cosmetic to be medical grade. In the United States, a skincare product is either a drug or a cosmetic depending on its intended use. There is no in between. The FDA defines cosmetics as "articles intended to be rubbed, poured, sprinkled, or sprayed on, introduced into, or otherwise applied...for cleansing, beautifying, promoting attractiveness, or altering the appearance." By law, cosmetics cannot claim to alter the structure or function of the skin. Products that intend to change the structure or function of skin are considered drugs. The FDA defines drugs as "articles intended for use in the diagnosis, cure, mitigation, treatment, or prevention of disease" and "articles...intended to affect the structure or function of..." skin.
Medical grade cosmetics are touted to be more effective, more powerful, and often of a higher quality. Unfortunately, this is all marketing. Some medical grade cosmetics may be very effective and contain a higher percentage of active ingredients. But they may not.
Many of these medical grade cosmetics are not available at local drugstores and you might even have to purchase them from a doctor’s office or spa. This low accessibility may add a bit of gravitas as they come with a ‘stamp of approval’ from the local professional. But once again, these are cosmetics, they don't intend to really change the structure or function of the skin or they’d be considered drugs and, by law, require premarket FDA approval before being sold on skincare aisles or in the doctor's office. There is no required testing for products marketed as medical grade. Medical grade skincare products are usually more expensive than drugstore products but oftentimes are formulated with similar ingredients.
Are there real differences between medical grade cosmetics and drugstore products? Of course the individual selling the product thinks there is. Unfortunately, there is no scientific proof or regulated guideline that proves medical grade skincare is more effective than drugstore brands.