BILL NUMBER: SB 1307 CHAPTERED 09/29/04 CHAPTER 857 FILED WITH SECRETARY OF STATE SEPTEMBER 29, 2004 APPROVED BY GOVERNOR SEPTEMBER 29, 2004 PASSED THE SENATE AUGUST 26, 2004 PASSED THE ASSEMBLY AUGUST 23, 2004 AMENDED IN ASSEMBLY AUGUST 5, 2004 AMENDED IN ASSEMBLY JULY 8, 2004 AMENDED IN ASSEMBLY JUNE 14, 2004 AMENDED IN ASSEMBLY MAY 28, 2004 AMENDED IN SENATE APRIL 14, 2004 AMENDED IN SENATE APRIL 1, 2004 INTRODUCED BY Senator Figueroa FEBRUARY 17, 2004 An act to amend Sections 4054, 4165, and 4166 of, to amend, repeal, and add Sections 4053, 4059.5, 4081, 4100, 4105, 4160, 4163, 4163.6, 4164, 4196, 4301, 4305.5, 4331, and 4400 of, to add Sections 4022.5, 4034, 4084, 4085, 4086, 4126.5, 4163.5, and 4168 to, to add and repeal Sections 4053.1 and 4169 of, and to repeal and add Section 4162 of, the Business and Professions Code, relating to drugs. LEGISLATIVE COUNSEL'S DIGEST SB 1307, Figueroa. Wholesalers and manufacturers of dangerous drugs and devices. (1) Existing law, the Pharmacy Law, provides for the licensing and regulation of pharmacists and wholesalers of dangerous drugs or dangerous devices by the Pharmacy Board. Existing law requires that dangerous drugs or dangerous devices be dispensed only by licensed pharmacists and only to certain persons or entities. Existing law provides certain exemptions from this requirement for manufacturers, veterinary food-animal drug retailers, and wholesalers, including those that employ sufficient qualified supervision by a person who possesses a certificate of exemption. Existing law also requires the board to take action against a licensee who is guilty of unprofessional conduct, as defined. Existing law makes a violation of the Pharmacy Law a crime. This bill would revise the list of persons to whom a pharmacy may furnish dangerous drugs. The bill would also revise the exemption provisions related to manufacturers, veterinary food-animal drug retailers, and wholesalers, and would change the certificate of exemption requirement to a requirement of licensure as a designated representative, as defined. The bill would require a wholesaler to keep track of excessive purchases of dangerous drugs by a pharmacy that primarily or solely dispenses those drugs to patients of long-term care facilities, and would make the clearly excessive furnishing of dangerous drugs to that pharmacy by a wholesaler unprofessional conduct. The bill would make other related changes. This bill would, on and after January 1, 2007, require a pedigree, as defined, to accompany each distribution of a dangerous drug, except if the compliance date is extended. It would, on and after that date, prohibit a wholesaler or pharmacy from selling, trading, or transferring a dangerous drug without a pedigree, and would prohibit a wholesaler or pharmacy from acquiring a dangerous drug without receiving a pedigree. (2) Existing law prohibits a person from acting as a wholesaler of dangerous drugs or devices without a license. This bill would require dangerous drugs or dangerous devices to be acquired from a person authorized by law to possess or furnish them. The bill would exempt a licensed drug manufacturer that only ships drugs of its own manufacture from the provisions governing wholesalers, except for the prohibition against furnishing dangerous drugs or devices to an unauthorized person. (3) Existing law imposes certain licensing and registration requirements on out-of-state manufacturers and wholesalers doing business in this state, and on their principals and agents. This bill would delete these requirements. (4) Existing law requires any manufacturer who sells or transfers a dangerous drug or dangerous device into this state or who receives a dangerous drug or dangerous device from a person in this state to, upon request, furnish an authorized officer of the law with all records or other documentation of that sale or transfer. Existing law makes a manufacturer who fails or refuses to comply with that request subject to a citation and a fine, an order of abatement, or both. This bill instead would apply these provisions to a wholesaler licensed by the board. The bill would delete the provision that makes the failure or refusal to comply with a request subject to a citation and a fine, an order of abatement, or both. The bill would require a wholesaler to submit a surety bond of $100,000, or an equivalent means of security, for all sites to be licensed. (5) The bill would prohibit a county or municipality from issuing a business license for an establishment that requires a wholesaler license unless the establishment possesses a current wholesaler license issued by the board. The bill would prohibit a person or entity from purchasing, trading, selling, or transferring a dangerous drug or device under specified circumstances, including if he or she knew, or reasonably should have known, the drug or device was adulterated or misbranded. The bill would make a violation of those provisions subject to a specified fine. The bill would specify to whom a pharmacist may furnish dangerous drugs. (6) The bill would make its provisions operative on January 1, 2006, except as specified. (7) Because a violation of the requirements and prohibitions created by this bill would be a crime, the bill would impose a state-mandated local program. (8) The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason. (9) This bill would become operative only if AB 2682 is also enacted and becomes effective on or before January 1, 2005. (10) This bill would incorporate additional changes in Sections 4059.5 and 4081 of the Business and Professions Code proposed by SB 1913, to be operative only if SB 1913 and this bill are both enacted and take effect, and this bill is enacted last. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 4022.5 is added to the Business and Professions Code, to read: 4022.5. (a) "Designated representative" means an individual to whom a license has been granted pursuant to Section 4053. (b) "Designated representative-in-charge" means a designated representative or a pharmacist who is the supervisor or manager of a wholesaler or veterinary food-animal drug retailer. (c) This section shall become operative on January 1, 2006. SEC. 3. Section 4034 is added to the Business and Professions Code, to read: 4034. (a) "Pedigree" means a record, in electronic form, containing information regarding each transaction resulting in a change of ownership of a given dangerous drug, from sale by a manufacturer, through acquisition and sale by a wholesaler, until final sale to a pharmacy or other person furnishing, administering, or dispensing the dangerous drug. (b) A pedigree shall include all of the following information: (1) The source of the dangerous drug, including the name, state license number, including California license number if available, and principal address of the source. (2) The quantity of the dangerous drug, its dosage form and strength, the date of the transaction, the sales invoice number, the container size, the number of containers, the expiration dates, and the lot numbers. (3) The business name, address, and if appropriate, the state license number, including a California license number if available, of each owner of the dangerous drug, and the dangerous drug shipping information, including the name and address of each person certifying delivery or receipt of the dangerous drug. (4) A certification under penalty of perjury from a responsible party of the source of the dangerous drug that the information contained in the pedigree is true and accurate. (c) If a licensed health care service plan, hospital organization, and one or more physician organizations have exclusive contractual relationships to provide health care services, drugs distributed between these persons shall be deemed not to have changed ownership. (d) The application of the pedigree requirement in pharmacies shall be subject to review during the board's sunset review to be conducted as described in subdivision (f) of Section 4001. (e) This section shall become operative on January 1, 2007. SEC. 6. Section 4053 of the Business and Professions Code is amended to read: 4053. (a) Subdivision (a) of Section 4051 shall not apply to a veterinary food-animal drug retailer or wholesaler if the board shall find that sufficient, qualified supervision is employed by the veterinary food-animal drug retailer or wholesaler to adequately safeguard and protect the public health, nor shall Section 4051 apply to any laboratory licensed under Section 351 of Title III of the Public Health Service Act (Public Law 78-410). (b) An individual employed by a veterinary food-animal drug retailer or wholesaler may apply for an exemption from Section 4051. In order to obtain and maintain that exemption, the individual shall meet the following requirements: (1) He or she shall be a high school graduate or possess a general education development equivalent. (2) He or she shall have a minimum of one year of paid work experience related to the distribution or dispensing of dangerous drugs or dangerous devices or meet all of the prerequisites to take the examination required for licensure as a pharmacist by the board. (3) He or she shall complete a training program approved by the board that, at a minimum, addresses each of the following subjects: (A) Knowledge and understanding of state and federal law relating to the distribution of dangerous drugs and dangerous devices. (B) Knowledge and understanding of state and federal law relating to the distribution of controlled substances. (C) Knowledge and understanding of quality control systems. (D) Knowledge and understanding of the United States Pharmacopoeia standards relating to the safe storage and handling of drugs. (E) Knowledge and understanding of prescription terminology, abbreviations, dosages and format. (4) The board may, by regulation, require training programs to include additional material. (5) The board may, by regulation, require training programs to include additional material. (6) The board shall not issue a certificate of exemption until the applicant provides proof of completion of the required training to the board. (c) The veterinary food-animal drug retailer or wholesaler shall not operate without a pharmacist or an individual in possession of a certificate of exemption on its premises. (d) Only a pharmacist or an individual in possession of a certificate of exemption shall prepare and affix the label to veterinary food-animal drugs. (e) This section shall become inoperative and is repealed on January 1, 2006, unless a later enacted statute, that becomes operative before January 1, 2006, amends or repeals that date. SEC. 7. Section 4053 is added to the Business and Professions Code, to read: 4053. (a) Subdivision (a) of Section 4051 shall not apply to a veterinary food-animal drug retailer or wholesaler that employs a designated representative to adequately safeguard and protect the public health, nor shall Section 4051 apply to any laboratory licensed under Section 351 of Title III of the Public Health Service Act (Public Law 78-410). (b) An individual may apply for a designated representative license. In order to obtain and maintain that license, the individual shall meet all of the following requirements: (1) He or she shall be a high school graduate or possess a general education development equivalent. (2) He or she shall have a minimum of one year of paid work experience, in the past three years, related to the distribution or dispensing of dangerous drugs or dangerous devices or meet all of the prerequisites to take the examination required for licensure as a pharmacist by the board. (3) He or she shall complete a training program approved by the board that, at a minimum, addresses each of the following subjects: (A) Knowledge and understanding of California law and federal law relating to the distribution of dangerous drugs and dangerous devices. (B) Knowledge and understanding of California law and federal law relating to the distribution of controlled substances. (C) Knowledge and understanding of quality control systems. (D) Knowledge and understanding of the United States Pharmacopoeia standards relating to the safe storage and handling of drugs. (E) Knowledge and understanding of prescription terminology, abbreviations, dosages and format. (4) The board may, by regulation, require training programs to include additional material. (5) The board may not issue a license as a designated representative until the applicant provides proof of completion of the required training to the board. (c) The veterinary food-animal drug retailer or wholesaler shall not operate without a pharmacist or a designated representative on its premises. (d) Only a pharmacist or a designated representative shall prepare and affix the label to veterinary food-animal drugs. (e) This section shall become operative on January 1, 2006. SEC. 8. Section 4053.1 is added to the Business and Professions Code, to read: 4053.1. (a) Certificates of exemption issued or renewed pursuant to Section 4053 prior to January 1, 2005, shall remain valid until their expiration date or until January 1, 2007, whichever date is earlier. (b) Individuals in possession of a current and valid certificate of exemption shall be issued a license as a designated representative if the individual satisfies the requirements of Section 4053 and pays the fee required by subdivision (i) of Section 4400. (c) This section shall become inoperative and be repealed on January 1, 2007, unless a later enacted statute, that becomes operative on or before December 31, 2006, amends or repeals that date. SEC. 9. Section 4054 of the Business and Professions Code is amended to read: 4054. Section 4051 shall not apply to a manufacturer or wholesaler that provides dialysis drugs and devices directly to patients. SEC. 10. Section 4059.5 of the Business and Professions Code is amended to read: 4059.5. (a) Except as otherwise provided in this chapter, dangerous drugs or dangerous devices may only be ordered by an entity licensed by the board and must be delivered to the licensed premises and signed for and received by the pharmacist-in-charge or, in his or her absence, another pharmacist designated by the pharmacist-in-charge. Where a licensee is permitted to operate through an exemptee, the exemptee may sign for and receive the delivery. (b) A dangerous drug or dangerous device transferred, sold, or delivered to any person within this state shall be transferred, sold, or delivered only to an entity licensed by the board, to a manufacturer, or to an ultimate user or the ultimate user's agent. (c) Notwithstanding subdivisions (a) and (b), deliveries to a hospital pharmacy may be made to a central receiving location within the hospital. However, the dangerous drugs or dangerous devices shall be delivered to the licensed pharmacy premises within one working day following receipt by the hospital, and the pharmacist on duty at that time shall immediately inventory the dangerous drug or dangerous devices. (d) Notwithstanding any other provision of law, a dangerous drug or dangerous device may be ordered by and provided to a manufacturer, physician, dentist, podiatrist, optometrist, veterinarian, or laboratory, or a physical therapist acting within the scope of his or her license. Any person or entity receiving delivery of any dangerous drugs or dangerous devices, or a duly authorized representative of the person or entity, shall sign for the receipt of the dangerous drugs or dangerous devices. (e) A dangerous drug or dangerous device shall not be transferred, sold, or delivered to any person outside this state, whether foreign or domestic, unless the transferor, seller, or deliverer does so in compliance with the laws of this state and of the United States and of the state or country to which the dangerous drugs or dangerous devices are to be transferred, sold, or delivered. Compliance with the laws of this state and the United States and of the state or country to which the dangerous drugs or dangerous devices are to be delivered shall include, but not be limited to, determining that the recipient of the dangerous drugs or dangerous devices is authorized by law to receive the dangerous drugs or dangerous devices. (f) This section shall remain in effect only until January 1, 2006, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2006, deletes or extends that date. SEC. 10.5. Section 4059.5 of the Business and Professions Code is amended to read: 4059.5. (a) Except as otherwise provided in this chapter, dangerous drugs or dangerous devices may only be ordered by an entity licensed by the board and shall be delivered to the licensed premises and signed for and received by a pharmacist. Where a licensee is permitted to operate through an exemptee, the exemptee may sign for and receive the delivery. (b) A dangerous drug or dangerous device transferred, sold, or delivered to a person within this state shall be transferred, sold, or delivered only to an entity licensed by the board, to a manufacturer, or to an ultimate user or the ultimate user's agent. (c) Notwithstanding subdivisions (a) and (b), deliveries to a hospital pharmacy may be made to a central receiving location within the hospital. However, the dangerous drugs or dangerous devices shall be delivered to the licensed pharmacy premises within one working day following receipt by the hospital, and the pharmacist on duty at that time shall immediately inventory the dangerous drugs or dangerous devices. (d) Notwithstanding any other provision of law, a dangerous drug or dangerous device may be ordered by and provided to a manufacturer, physician, dentist, podiatrist, optometrist, veterinarian, or laboratory, or a physical therapist acting within the scope of his or her license. A person or entity receiving delivery of a dangerous drug or dangerous device, or a duly authorized representative of the person or entity, shall sign for the receipt of the dangerous drug or dangerous device. (e) A dangerous drug or dangerous device shall not be transferred, sold, or delivered to a person outside this state, whether foreign or domestic, unless the transferor, seller, or deliverer does so in compliance with the laws of this state and of the United States and of the state or country to which the dangerous drugs or dangerous devices are to be transferred, sold, or delivered. Compliance with the laws of this state and the United States and of the state or country to which the dangerous drugs or dangerous devices are to be delivered shall include, but not be limited to, determining that the recipient of the dangerous drugs or dangerous devices is authorized by law to receive the dangerous drugs or dangerous devices. (f) Notwithstanding subdivision (a), a pharmacy may take delivery of dangerous drugs and dangerous devices when the pharmacy is closed and no pharmacist is on duty if all of the following requirements are met: (1) The drugs are placed in a secure storage facility in the same building as the pharmacy. (2) Only the pharmacist-in-charge or a pharmacist designated by the pharmacist-in-charge has access to the secure storage facility after dangerous drugs or dangerous devices have been delivered. (3) The secure storage facility has a means of indicating whether it has been entered after dangerous drugs or dangerous devices have been delivered. (4) The pharmacy maintains written policies and procedures for the delivery of dangerous drugs and dangerous devices to a secure storage facility. (5) The agent delivering dangerous drugs and dangerous devices pursuant to this subdivision leaves documents indicating the name and amount of each dangerous drug or dangerous device delivered in the secure storage facility. The pharmacy shall be responsible for the dangerous drugs and dangerous devices delivered to the secure storage facility. The pharmacy shall also be responsible for obtaining and maintaining records relating to the delivery of dangerous drugs and dangerous devices to a secure storage facility. (g) This section shall remain in effect only until January 1, 2006, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2006, deletes or extends that date. SEC. 11. Section 4059.5 is added to the Business and Professions Code, to read: 4059.5. (a) Except as otherwise provided in this chapter, dangerous drugs or dangerous devices may only be ordered by an entity licensed by the board and shall be delivered to the licensed premises and signed for and received by the pharmacist-in-charge or, in his or her absence, another pharmacist designated by the pharmacist-in-charge. Where a licensee is permitted to operate through a designated representative, the designated representative may sign for and receive the delivery. (b) A dangerous drug or dangerous device transferred, sold, or delivered to any person within this state shall be transferred, sold, or delivered only to an entity licensed by the board, to a manufacturer, or to an ultimate user or the ultimate user's agent. (c) Notwithstanding subdivisions (a) and (b), deliveries to a hospital pharmacy may be made to a central receiving location within the hospital. However, the dangerous drugs or dangerous devices shall be delivered to the licensed pharmacy premises within one working day following receipt by the hospital, and the pharmacist on duty at that time shall immediately inventory the dangerous drugs or dangerous devices. (d) Notwithstanding any other provision of law, a dangerous drug or dangerous device may be ordered by and provided to a manufacturer, physician, dentist, podiatrist, optometrist, veterinarian, or laboratory, or physical therapist acting within the scope of his or her license. A person or entity receiving delivery of any dangerous drugs or dangerous devices, or a duly authorized representative of the person or entity, shall sign for the receipt of the dangerous drugs or dangerous devices. (e) A dangerous drug or dangerous device shall not be transferred, sold, or delivered to any person outside this state, whether foreign or domestic, unless the transferor, seller, or deliverer does so in compliance with the laws of this state and of the United States and of the state or country to which the dangerous drugs or dangerous devices are to be transferred, sold, or delivered. Compliance with the laws of this state and the United States and of the state or country to which the dangerous drugs or dangerous devices are to be delivered shall include, but not be limited to, determining that the recipient of the dangerous drugs or dangerous devices is authorized by law to receive the dangerous drugs or dangerous devices. (f) This section shall become operative on January 1, 2006. SEC. 11.5. Section 4059.5 is added to the Business and Professions Code, to read: 4059.5. (a) Except as otherwise provided in this chapter, dangerous drugs or dangerous devices may only be ordered by an entity licensed by the board and shall be delivered to the licensed premises and signed for and received by a pharmacist. Where a licensee is permitted to operate through a designated representative, the designated representative may sign for and receive the delivery. (b) A dangerous drug or dangerous device transferred, sold, or delivered to a person within this state shall be transferred, sold, or delivered only to an entity licensed by the board, to a manufacturer, or to an ultimate user or the ultimate user's agent. (c) Notwithstanding subdivisions (a) and (b), deliveries to a hospital pharmacy may be made to a central receiving location within the hospital. However, the dangerous drugs or dangerous devices shall be delivered to the licensed pharmacy premises within one working day following receipt by the hospital, and the pharmacist on duty at that time shall immediately inventory the dangerous drugs or dangerous devices. (d) Notwithstanding any other provision of law, a dangerous drug or dangerous device may be ordered by and provided to a manufacturer, physician, dentist, podiatrist, optometrist, veterinarian, or laboratory, or a physical therapist acting within the scope of his or her license. A person or entity receiving delivery of a dangerous drug or dangerous device, or a duly authorized representative of the person or entity, shall sign for the receipt of the dangerous drug or dangerous device. (e) A dangerous drug or dangerous device shall not be transferred, sold, or delivered to a person outside this state, whether foreign or domestic, unless the transferor, seller, or deliverer does so in compliance with the laws of this state and of the United States and of the state or country to which the dangerous drugs or dangerous devices are to be transferred, sold, or delivered. Compliance with the laws of this state and the United States and of the state or country to which the dangerous drugs or dangerous devices are to be delivered shall include, but not be limited to, determining that the recipient of the dangerous drugs or dangerous devices is authorized by law to receive the dangerous drugs or dangerous devices. (f) Notwithstanding subdivision (a), a pharmacy may take delivery of dangerous drugs and dangerous devices when the pharmacy is closed and no pharmacist is on duty if all of the following requirements are met: (1) The drugs are placed in a secure storage facility in the same building as the pharmacy. (2) Only the pharmacist-in-charge or a pharmacist designated by the pharmacist-in-charge has access to the secure storage facility after dangerous drugs or dangerous devices have been delivered. (3) The secure storage facility has a means of indicating whether it has been entered after dangerous drugs or dangerous devices have been delivered. (4) The pharmacy maintains written policies and procedures for the delivery of dangerous drugs and dangerous devices to a secure storage facility. (5) The agent delivering dangerous drugs and dangerous devices pursuant to this subdivision leaves documents indicating the name and amount of each dangerous drug or dangerous device delivered in the secure storage facility. The pharmacy shall be responsible for the dangerous drugs and dangerous devices delivered to the secure storage facility. The pharmacy shall also be responsible for obtaining and maintaining records relating to the delivery of dangerous drugs and dangerous devices to a secure storage facility. (g) This section shall become operative on January 1, 2006. SEC. 12. Section 4081 of the Business and Professions Code is amended to read: 4081. (a) All records of manufacture and of sale, acquisition, or disposition of dangerous drugs or dangerous devices shall be at all times during business hours open to inspection by authorized officers of the law, and shall be preserved for at least three years from the date of making. A current inventory shall be kept by every manufacturer, wholesaler, pharmacy, veterinary food-animal drug retailer, physician, dentist, podiatrist, veterinarian, laboratory, clinic, hospital, institution, or establishment holding a currently valid and unrevoked certificate, license, permit, registration, or exemption under Division 2 (commencing with Section 1200) of the Health and Safety Code or under Part 4 (commencing with Section 16000) of Division 9 of the Welfare and Institutions Code who maintains a stock of dangerous drugs or dangerous devices. (b) The owner, officer, and partner of any pharmacy, wholesaler, or veterinary food-animal drug retailer shall be jointly responsible, with the pharmacist-in-charge or exemptee, for maintaining the records and inventory described in this section. (c) The pharmacist-in-charge or exemptee shall not be criminally responsible for acts of the owner, officer, partner, or employee that violate this section and of which the pharmacist-in-charge or exemptee had no knowledge, or in which he or she did not knowingly participate. (d) This section shall remain in effect only until January 1, 2006, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2006, deletes or extends that date. SEC. 12.5. Section 4081 of the Business and Professions Code is amended to read: 4081. (a) All records of manufacture and of sale, acquisition, or disposition of dangerous drugs or dangerous devices shall be at all times during business hours open to inspection by authorized officers of the law, and shall be preserved for at least three years from the date of making. A current inventory shall be kept by every manufacturer, wholesaler, pharmacy, veterinary food-animal drug retailer, physician, dentist, podiatrist, veterinarian, laboratory, clinic, hospital, institution, or establishment holding a currently valid and unrevoked certificate, license, permit, registration, or exemption under Division 2 (commencing with Section 1200) of the Health and Safety Code or under Part 4 (commencing with Section 16000) of Division 9 of the Welfare and Institutions Code who maintains a stock of dangerous drugs or dangerous devices. (b) The owner, officer, and partner of any pharmacy, wholesaler, or veterinary food-animal drug retailer shall be jointly responsible, with the pharmacist-in-charge or exemptee-in-charge, for maintaining the records and inventory described in this section. (c) The pharmacist-in-charge or exemptee-in-charge shall not be criminally responsible for acts of the owner, officer, partner, or employee that violate this section and of which the pharmacist-in-charge or exemptee-in-charge had no knowledge, or in which he or she did not knowingly participate. (d) This section shall remain in effect only until January 1, 2006, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2006, deletes or extends that date. SEC. 13. Section 4081 is added to the Business and Professions Code, to read: 4081. (a) All records of manufacture and of sale, acquisition, or disposition of dangerous drugs or dangerous devices shall be at all times during business hours open to inspection by authorized officers of the law, and shall be preserved for at least three years from the date of making. A current inventory shall be kept by every manufacturer, wholesaler, pharmacy, veterinary food-animal drug retailer, physician, dentist, podiatrist, veterinarian, laboratory, clinic, hospital, institution, or establishment holding a currently valid and unrevoked certificate, license, permit, registration, or exemption under Division 2 (commencing with Section 1200) of the Health and Safety Code or under Part 4 (commencing with Section 16000) of Division 9 of the Welfare and Institutions Code who maintains a stock of dangerous drugs or dangerous devices. (b) The owner, officer, and partner of a pharmacy, wholesaler, or veterinary food-animal drug retailer shall be jointly responsible, with the pharmacist-in-charge or designated representative-in-charge, for maintaining the records and inventory described in this section. (c) The pharmacist-in-charge or designated representative-in-charge shall not be criminally responsible for acts of the owner, officer, partner, or employee that violate this section and of which the pharmacist-in-charge or designated representative-in-charge had no knowledge, or in which he or she did not knowingly participate. (d) This section shall become operative on January 1, 2006. SEC. 13.5. Section 4081 is added to the Business and Professions Code, to read: 4081. (a) All records of manufacture and of sale, acquisition, or disposition of dangerous drugs or dangerous devices shall be at all times during business hours open to inspection by authorized officers of the law, and shall be preserved for at least three years from the date of making. A current inventory shall be kept by every manufacturer, wholesaler, pharmacy, veterinary food-animal drug retailer, physician, dentist, podiatrist, veterinarian, laboratory, clinic, hospital, institution, or establishment holding a currently valid and unrevoked certificate, license, permit, registration, or exemption under Division 2 (commencing with Section 1200) of the Health and Safety Code or under Part 4 (commencing with Section 16000) of Division 9 of the Welfare and Institutions Code who maintains a stock of dangerous drugs or dangerous devices. (b) The owner, officer, and partner of a pharmacy, wholesaler, or veterinary food-animal drug retailer shall be jointly responsible, with the pharmacist-in-charge or representative-in-charge, for maintaining the records and inventory described in this section. (c) The pharmacist-in-charge or representative-in-charge shall not be criminally responsible for acts of the owner, officer, partner, or employee that violate this section and of which the pharmacist-in-charge or representative-in-charge had no knowledge, or in which he or she did not knowingly participate. (d) This section shall become operative on January 1, 2006. SEC. 14. Section 4084 is added to the Business and Professions Code, to read: 4084. (a) When a board inspector finds, or has probable cause to believe, that any dangerous drug or dangerous device is adulterated or counterfeit, the board inspector shall affix a tag or other marking to that dangerous drug or dangerous device. The board inspector shall give notice to the person that the dangerous drug or dangerous device bearing the tag or marking has been embargoed. (b) When a board inspector has found that an embargoed dangerous drug or dangerous device is not adulterated or counterfeit, a board inspector shall remove the tag or other marking. (c) A board inspector may secure a sample or specimen of a dangerous drug or dangerous device. If the board inspector obtains a sample prior to leaving the premises, the board inspector shall leave a receipt describing the sample. (d) For the purposes of this article "counterfeit" shall have the meaning defined in Section 109905 of the Health and Safety Code. (e) For the purposes of this article "adulterated" shall have the meaning defined in Article 2 (commencing with Section 111250) of Chapter 6 of Part 5 of Division 104 of the Health and Safety Code. SEC. 15. Section 4085 is added to the Business and Professions Code, to read: 4085. (a) It is unlawful for any person to remove, sell, or dispose of an embargoed dangerous drug or dangerous device without permission of the board. (b) When a board inspector has reasonable cause to believe, that the embargo will be violated, a board inspector may remove the embargoed dangerous drug or dangerous device from the premises. SEC. 16. Section 4086 is added to the Business and Professions Code, to read: 4086. (a) If a dangerous drug or dangerous device is alleged to be adulterated or counterfeit, the board shall commence proceedings in the superior court in whose jurisdiction the dangerous drug or dangerous device is located, for condemnation of the dangerous drug or dangerous device. (b) If the court finds that an embargoed dangerous drug or dangerous device is adulterated or counterfeit, the dangerous drug or dangerous device shall, after entry of the judgment, be destroyed at the expense of the claimant or owner, under the supervision of the board. All court costs and fees and all reasonable costs incurred by the board in investigating and prosecuting the action, including, but not limited to, the costs of storage and testing, shall be paid by the claimant or owner of the dangerous drug or dangerous device. (c) A superior court of this state may condemn any dangerous drug or dangerous device pursuant to this article. In the absence of an order, the dangerous drug or dangerous device may be destroyed under the supervision of the board who has the written consent of the owner, his or her attorney, or authorized representative. If the board cannot ascertain ownership of the dangerous drug or dangerous device within 30 days of establishing an embargo, the board may destroy the dangerous drug or dangerous device. SEC. 17. Section 4100 of the Business and Professions Code is amended to read: 4100. (a) Within 30 days after changing his or her address of record with the board or after changing his or her name according to law, every pharmacist, intern pharmacist, technician, or exemptee shall notify the executive officer of the board of the change of address or change of name. (b) This section shall become inoperative and is repealed on January 1, 2006, unless a later enacted statute, that becomes operative on or before January 1, 2006, amends or repeals that date. SEC. 18. Section 4100 is added to the Business and Professions Code, to read: 4100. (a) Within 30 days after changing his or her address of record with the board or after changing his or her name according to law, a pharmacist, intern pharmacist, technician, or designated representative shall notify the executive officer of the board of the change of address or change of name. (b) This section shall become operative on January 1, 2006. SEC. 19. Section 4105 of the Business and Professions Code is amended to read: 4105. (a) All records or other documentation of the acquisition and disposition of dangerous drugs and dangerous devices by any entity licensed by the board shall be retained on the licensed premises in a readily retrievable form. (b) The licensee may remove the original records or documentation from the licensed premises on a temporary basis for license-related purposes. However, a duplicate set of those records or other documentation shall be retained on the licensed premises. (c) The records required by this section shall be retained on the licensed premises for a period of three years from the date of making. (d) Any records that are maintained electronically shall be maintained so that the pharmacist-in-charge, the pharmacist on duty if the pharmacist-in-charge is not on duty, or, in the case of a veterinary food-animal drug retailer or wholesaler, the exemptee, shall, at all times during which the licensed premises are open for business, be able to produce a hard copy and electronic copy of all records of acquisition or disposition or other drug or dispensing-related records maintained electronically. (e) (1) Notwithstanding subdivisions (a), (b), and (c), the board, may upon written request, grant to a licensee a waiver of the requirements that the records described in subdivisions (a), (b), and (c) be kept on the licensed premises. (2) A waiver granted pursuant to this subdivision shall not affect the board's authority under this section or any other provision of this chapter. (f) This section shall become inoperative and is repealed on January 1, 2006, unless a later enacted statute, that becomes operative on or before January 1, 2006, amends or repeals that date. SEC. 20. Section 4105 is added to the Business and Professions Code, to read: 4105. (a) All records or other documentation of the acquisition and disposition of dangerous drugs and dangerous devices by any entity licensed by the board shall be retained on the licensed premises in a readily retrievable form. (b) The licensee may remove the original records or documentation from the licensed premises on a temporary basis for license-related purposes. However, a duplicate set of those records or other documentation shall be retained on the licensed premises. (c) The records required by this section shall be retained on the licensed premises for a period of three years from the date of making. (d) Any records that are maintained electronically shall be maintained so that the pharmacist-in-charge, the pharmacist on duty if the pharmacist-in-charge is not on duty, or, in the case of a veterinary food-animal drug retailer or wholesaler, the designated representative on duty, shall, at all times during which the licensed premises are open for business, be able to produce a hard copy and electronic copy of all records of acquisition or disposition or other drug or dispensing-related records maintained electronically. (e) (1) Notwithstanding subdivisions (a), (b), and (c), the board, may upon written request, grant to a licensee a waiver of the requirements that the records described in subdivisions (a), (b), and (c) be kept on the licensed premises. (2) A waiver granted pursuant to this subdivision shall not affect the board's authority under this section or any other provision of this chapter. (f) This section shall become operative on January 1, 2006. SEC. 23. Section 4126.5 is added to the Business and Professions Code, to read: 4126.5. (a) A pharmacy may furnish dangerous drugs only to the following: (1) A wholesaler owned or under common control by the wholesaler from whom the dangerous drug was acquired. (2) The pharmaceutical manufacturer from whom the dangerous drug was acquired. (3) A licensed wholesaler acting as a reverse distributor. (4) Another pharmacy or wholesaler to alleviate a temporary shortage of a dangerous drug that could result in the denial of health care. A pharmacy furnishing dangerous drugs pursuant to this paragraph may only furnish a quantity sufficient to alleviate the temporary shortage. (5) A patient or to another pharmacy pursuant to a prescription or as otherwise authorized by law. (6) A health care provider that is not a pharmacy but that is authorized to purchase dangerous drugs. (7) To another pharmacy under common control. (b) Notwithstanding any other provision of law, a violation of this section by either a pharmacy whose primary or sole business is filling prescriptions for patients of long-term care facilities or a person engaged in a prohibited transaction with a pharmacy whose primary or sole business is filling prescriptions for patients of long-term care facilities may subject the persons who committed the violation to a fine not to exceed the amount specified in Section 125.9 for each occurrence pursuant to a citation issued by the board. (c) Amounts due from any person under this section on or after January 1, 2005, shall be offset as provided under Section 12419.5 of the Government Code. Amounts received by the board under this section shall be deposited into the Pharmacy Board Contingent Fund. (d) For purposes of this section, "common control" means the power to direct or cause the direction of the management and policies of another person whether by ownership, by voting rights, by contract, or by other means. (e) For purposes of subdivision (b) of this section and subdivision (s) of Section 4301, "long-term care facility" shall have the same meaning given the term in Section 1418 of the Health and Safety Code. SEC. 24. Section 4160 of the Business and Professions Code is amended to read: 4160. (a) A person may not act as a wholesaler of any dangerous drug or dangerous device unless he or she has obtained a license from the board. (b) Upon approval by the board and the payment of the required fee, the board shall issue a license to the applicant. (c) A separate license shall be required for each place of business owned or operated by a wholesaler. Each license shall be renewed annually and shall not be transferable. (d) The board shall not issue or renew a wholesaler license until the wholesaler designates an exemptee-in-charge and notifies the board in writing of the identity and license number of that exemptee-in-charge. The exemptee-in-charge shall be responsible for the wholesaler's compliance with state and federal laws governing wholesalers. A wholesaler shall designate, and notify the board of, a new exemptee-in-charge within 30 days of the date that the prior exemptee-in-charge ceases to be the exemptee-in-charge. A pharmacist may be designated as the exemptee-in-charge. (e) For purposes of this section, "exemptee-in-charge" means a person granted a certificate of exemption pursuant to Section 4053, or a registered pharmacist, who is the supervisor or manager of the facility. (f) A drug manufacturer licensed by the Food and Drug Administration or pursuant to Section 111615 of the Health and Safety Code that only ships dangerous drugs or dangerous devices of its own manufacture is exempt from this section. (g) This section shall become inoperative and is repealed on January 1, 2006, unless a later enacted statute, that becomes operative on or before January 1, 2006, amends or repeals that date. SEC. 25. Section 4160 is added to the Business and Professions Code, to read: 4160. (a) A person may not act as a wholesaler of any dangerous drug or dangerous device unless he or she has obtained a license from the board. (b) Upon approval by the board and the payment of the required fee, the board shall issue a license to the applicant. (c) A separate license shall be required for each place of business owned or operated by a wholesaler. Each license shall be renewed annually and shall not be transferable. (d) The board shall not issue or renew a wholesaler license until the wholesaler identifies a designated representative-in-charge and notifies the board in writing of the identity and license number of that designated representative. The designated representative-in-charge shall be responsible for the wholesaler's compliance with state and federal laws governing wholesalers. A wholesaler shall identify and notify the board of a new designated representative-in-charge within 30 days of the date that the prior designated representative-in-charge ceases to be the designated representative-in-charge. A pharmacist may be identified as the designated representative-in-charge. (e) A drug manufacturer licensed by the Food and Drug Administration or licensed pursuant to Section 111615 of the Health and Safety Code that only distributes dangerous drugs and dangerous devices of its own manufacture is exempt from this section and Section 4161. (f) The board may issue a temporary license, upon conditions and for periods of time as the board determines to be in the public interest. A temporary license fee shall be fixed by the board at an amount not to exceed the annual fee for renewal of a license to conduct business as a wholesaler. (g) This section shall become operative on January 1, 2006. SEC. 29. Section 4162 of the Business and Professions Code is repealed. SEC. 30. Section 4162 is added to the Business and Professions Code, to read: 4162. (a) (1) An applicant for the issuance or renewal of a wholesaler license shall submit a surety bond of one hundred thousand dollars ($100,000) or other equivalent means of security acceptable to the board payable to the Pharmacy Board Contingent Fund. The purpose of the surety bond is to secure payment of any administrative fine imposed by the board and any cost recovery ordered pursuant to Section 125.3. (2) For purposes of paragraph (1), the board may accept a surety bond less than one hundred thousand dollars ($100,000) if the annual gross receipts of the previous tax year for the wholesaler is ten million dollars ($10,000,000) or less, in which case the surety bond shall be twenty-five thousand dollars ($25,000). (3) A person to whom an approved new drug application has been issued by the United States Food and Drug Administration who engages in the wholesale distribution of only the dangerous drug specified in the new drug application, and is licensed or applies for licensure as a wholesaler, shall not be required to post a surety bond as provided in paragraph (1). (4) For licensees subject to paragraph (2) or (3), the board may require a bond up to one hundred thousand dollars ($100,000) for any licensee who has been disciplined by any state or federal agency or has been issued an administrative fine pursuant to this chapter. (b) The board may make a claim against the bond if the licensee fails to pay a fine within 30 days after the order imposing the fine, or costs become final. (c) A single surety bond or other equivalent means of security acceptable to the board shall satisfy the requirement of subdivision (a) for all licensed sites under common control as defined in Section 4126.5. (d) This section shall become operative on January 1, 2006, and shall remain in effect only until January 1, 2011, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2011, deletes or extends those dates. SEC. 31. Section 4163 of the Business and Professions Code is amended to read: 4163. (a) No manufacturer or wholesaler shall furnish any dangerous drugs or dangerous devices to any unauthorized persons. (b) No person shall acquire dangerous drugs or dangerous devices from a person not authorized by law to possess or furnish those dangerous drugs or dangerous devices. When the person acquiring the dangerous drugs or dangerous devices is a wholesaler, the obligation of the wholesaler shall be limited to obtaining confirmation of licensure of those sources from whom it has not previously acquired dangerous drugs or dangerous devices. (c) This section shall remain in effect only until January 1, 2007, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2007, deletes or extends that date. SEC. 32. Section 4163 is added to the Business and Professions Code, to read: 4163. (a) A manufacturer or wholesaler may not furnish a dangerous drug or dangerous device to an unauthorized person. (b) Dangerous drugs or dangerous devices shall be acquired from a person authorized by law to possess or furnish dangerous drugs or dangerous devices. When the person acquiring the dangerous drugs or dangerous devices is a wholesaler, the obligation of the wholesaler shall be limited to obtaining confirmation of licensure of those sources from whom it has not previously acquired dangerous drugs or dangerous devices. (c) A wholesaler or pharmacy may not sell, trade, or transfer a dangerous drug at wholesale without providing a pedigree. (d) A wholesaler or pharmacy may not acquire a dangerous drug without receiving a pedigree. (e) This section shall become operative on January 1, 2007. SEC. 33. Section 4163.5 is added to the Business and Professions Code, to read: 4163.5. The board may extend the date for compliance with the requirement for a pedigree set forth in Section 4163 until January 1, 2008, if it determines that manufacturers or wholesalers require additional time to implement electronic technologies to track the distribution of dangerous drugs within the state. A determination by the board to extend the deadline for providing pedigrees shall not be subject to the requirements of Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code. SEC. 33.1. Section 4163.6 is added to the Business and Professions Code, to read: 4163.6. If the Legislature determines that it is not yet economically and technically feasible for pharmacies to implement electronic technologies to track the distribution of dangerous drugs within the state, the Legislature may extend the date for compliance with the requirement for a pedigree for pharmacies set forth in Section 4163 until January 1, 2009. SEC. 34. Section 4164 of the Business and Professions Code is amended to read: 4164. (a) All wholesalers licensed by the board and all manufacturers who distribute controlled substances, dangerous drugs, or dangerous devices within or into this state shall report to the board all sales of dangerous drugs and controlled substances that are subject to abuse, as determined by the board. (b) This section shall become inoperative and is repealed on January 1, 2006, unless a later enacted statute, that becomes operative on or before January 1, 2006, amends or repeals that date. SEC. 35. Section 4164 is added to the Business and Professions Code, to read: 4164. (a) A wholesaler licensed by the board that distributes controlled substances, dangerous drugs, or dangerous devices within or into this state shall report to the board all sales of dangerous drugs and controlled substances that are subject to abuse, as determined by the board. (b) Each wholesaler shall develop and maintain a system for tracking individual sales of dangerous drugs at preferential or contract prices to pharmacies that primarily or solely dispense prescription drugs to patients of long-term care facilities. The system shall be capable of identifying purchases of any dangerous drug at preferential or contract prices by customers that vary significantly from prior ordering patterns for the same customer, including by identifying purchases in the preceding 12 calendar months by that customer or similar customers and identifying current purchases that exceed prior purchases by either that customer or similar customers by a factor of 20 percent. Each wholesaler shall have the tracking system required by this subdivision in place no later than January 1, 2006. (c) Upon written, oral, or electronic request by the board, a wholesaler shall furnish data tracked pursuant to subdivision (b) to the board in written, hardcopy, or electronic form. The board shall specify the dangerous drugs, the customers, or both the dangerous drugs and customers for which data are to be furnished, and the wholesaler shall have 30 calendar days to comply with the request. (d) As used in this section, "preferential or contract prices" means and refers to purchases by contract of dangerous drugs at prices below the market wholesale price for those drugs. (e) This section shall become operative on January 1, 2006. SEC. 36. Section 4165 of the Business and Professions Code is amended to read: 4165. A wholesaler licensed by the board who sells or transfers any dangerous drug or dangerous device into this state or who receives, by sale or otherwise, any dangerous drug or dangerous device from any person in this state shall, on request, furnish an authorized officer of the law with all records or other documentation of that sale or transfer. SEC. 37. Section 4166 of the Business and Professions Code is amended to read: 4166. (a) Any wholesaler that uses the services of any carrier, including, but not limited to, the United States Postal Service or any common carrier, shall be liable for the security and integrity of any dangerous drugs or dangerous devices through that carrier until the drugs or devices are delivered to the transferee at its board-licensed premises. (b) Nothing in this section is intended to affect the liability of a wholesaler or other distributor for dangerous drugs or dangerous devices after their delivery to the transferee. SEC. 38. Section 4168 is added to the Business and Professions Code, to read: 4168. A county or municipality may not issue a business license for any establishment that requires a wholesaler license unless the establishment possesses a current wholesaler license issued by the board. For purposes of this section, an "establishment" is the licensee's physical location in California. SEC. 39. Section 4169 is added to the Business and Professions Code, to read: 4169. (a) A person or entity may not do any of the following: (1) Purchase, trade, sell, or transfer dangerous drugs or dangerous devices at wholesale with a person or entity that is not licensed with the board as a wholesaler or pharmacy, in violation of Section 4163. (2) Purchase, trade, sell, or transfer dangerous drugs that the person knew or reasonably should have known were adulterated, as set forth in Article 2 (commencing with Section 111250) of Chapter 6 of Part 5 of Division 104 of the Health and Safety Code. (3) Purchase, trade, sell, or transfer dangerous drugs that the person knew or reasonably should have known were misbranded, as defined in Section 111335 of the Health and Safety Code. (4) Purchase, trade, sell, or transfer dangerous drugs or dangerous devices after the beyond use date on the label. (5) Fail to maintain records of the acquisition or disposition of dangerous drugs or dangerous devices for at least three years. (b) Notwithstanding any other provision of law, a violation of this section may subject the person or entity that has committed the violation to a fine not to exceed the amount specified in Section 125.9 for each occurrence, pursuant to a citation issued by the board. (c) Amounts due from any person under this section shall be offset as provided under Section 12419.5 of the Government Code. Amounts received by the board under this section shall be deposited into the Pharmacy Board Contingent Fund. (d) This section shall not apply to a pharmaceutical manufacturer licensed by the Food and Drug Administration or by the State Department of Health Services. (e) This section shall remain in effect only until January 1, 2007, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2007, deletes or extends that date. SEC. 40. Section 4169 is added to the Business and Professions Code, to read: 4169. (a) A person or entity may not do any of the following: (1) Purchase, trade, sell, or transfer dangerous drugs or dangerous devices at wholesale with a person or entity that is not licensed with the board as a wholesaler or pharmacy. (2) Purchase, trade, sell, or transfer dangerous drugs that the person knew or reasonably should have known were adulterated, as set forth in Article 2 (commencing with Section 111250) of Chapter 6 of Part 5 of Division 104 of the Health and Safety Code. (3) Purchase, trade, sell, or transfer dangerous drugs that the person knew or reasonably should have known were misbranded, as defined in Section 111335 of the Health and Safety Code. (4) Purchase, trade, sell, or transfer dangerous drugs or dangerous devices after the beyond use date on the label. (5) Fail to maintain records of the acquisition or disposition of dangerous drugs or dangerous devices for at least three years. (b) Notwithstanding any other provision of law, a violation of this section or of subdivision (c) or (d) of Section 4163 may subject the person or entity that has committed the violation to a fine not to exceed the amount specified in Section 125.9 for each occurrence, pursuant to a citation issued by the board. (c) Amounts due from any person under this section shall be offset as provided under Section 12419.5 of the Government Code. Amounts received by the board under this section shall be deposited into the Pharmacy Board Contingent Fund. (d) This section shall not apply to a pharmaceutical manufacturer licensed by the Food and Drug Administration or by the State Department of Health Services. (e) This section shall become operative on January 1, 2007. SEC. 41. Section 4196 of the Business and Professions Code is amended to read: 4196. (a) No person shall conduct a veterinary food-animal drug retailer in the State of California unless he or she has obtained a license from the board. A license shall be required for each veterinary food-animal drug retailer owned or operated by a specific person. A separate license shall be required for each of the premises of any person operating a veterinary food-animal drug retailer in more than one location. The license shall be renewed annually and shall not be transferable. (b) The board may issue a temporary license, upon conditions and for periods of time as the board determines to be in the public interest. A temporary license fee shall be fixed by the board at an amount not to exceed the annual fee for renewal of a license to conduct a veterinary food-animal drug retailer. (c) No person other than a pharmacist, an intern pharmacist, an exempt person, an authorized officer of the law, or a person authorized to prescribe, shall be permitted in that area, place, or premises described in the permit issued by the board pursuant to Section 4041, wherein veterinary food-animal drugs are stored, possessed, or repacked. A pharmacist or exemptee shall be responsible for any individual who enters the veterinary food-animal drug retailer for the purpose of performing clerical, inventory control, housekeeping, delivery, maintenance, or similar functions relating to the veterinary food-animal drug retailer. (d) The board shall not issue or renew a veterinary food-animal retailer license until the veterinary food-animal drug retailer designates an exemptee-in-charge and notifies the board in writing of the identity and license number of that exemptee. The exemptee-in-charge shall be responsible for the veterinary food-animal drug retailer's compliance with state and federal laws governing veterinary food-animal drug retailers. Each veterinary food-animal drug retailer shall designate, and notify the board of, a new exemptee-in-charge within 30 days of the date that the prior exemptee-in-charge ceases to be the exemptee-in-charge. A pharmacist may be designated as the exemptee-in-charge. (e) For purposes of this section, "exemptee-in-charge" means a person granted a certificate of exemption pursuant to Section 4053, or a registered pharmacist, who is the supervisor or manager of the facility. (f) This section shall become inoperative and is repealed on January 1, 2006, unless a later enacted statute, that becomes operative on or before January 1, 2006, amends or repeals that date. SEC. 42. Section 4196 is added to the Business and Professions Code, to read: 4196. (a) No person shall conduct a veterinary food-animal drug retailer in the State of California unless he or she has obtained a license from the board. A license shall be required for each veterinary food-animal drug retailer owned or operated by a specific person. A separate license shall be required for each of the premises of any person operating a veterinary food-animal drug retailer in more than one location. The license shall be renewed annually and shall not be transferable. (b) The board may issue a temporary license, upon conditions and for periods of time as the board determines to be in the public interest. A temporary license fee shall be fixed by the board at an amount not to exceed the annual fee for renewal of a license to conduct a veterinary food-animal drug retailer. (c) No person other than a pharmacist, an intern pharmacist, a designated representative, an authorized officer of the law, or a person authorized to prescribe, shall be permitted in that area, place, or premises described in the permit issued by the board pursuant to Section 4041, wherein veterinary food-animal drugs are stored, possessed, or repacked. A pharmacist or designated representative shall be responsible for any individual who enters the veterinary food-animal drug retailer for the purpose of performing clerical, inventory control, housekeeping, delivery, maintenance, or similar functions relating to the veterinary food-animal drug retailer. (d) The board shall not issue or renew a veterinary food-animal retailer license until the veterinary food-animal drug retailer identifies a designated representative-in-charge and notifies the board in writing of the identity and license number of that designated representative. The designated representative-in-charge shall be responsible for the veterinary food-animal drug retailer's compliance with state and federal laws governing veterinary food-animal drug retailers. Each veterinary food-animal drug retailer shall identify, and notify the board of, a new designated representative-in-charge within 30 days of the date that the prior designated representative-in-charge ceases to be the designated representative-in-charge. A pharmacist may be identified as the designated representative-in-charge. (e) For purposes of this section, designated representative-in-charge means a person granted a designated representative license pursuant to Section 4053, or a registered pharmacist, who is the supervisor or manager of the facility. (f) This section shall become operative on January 1, 2006. SEC. 43. Section 4301 of the Business and Professions Code is amended to read: 4301. The board shall take action against any holder of a license who is guilty of unprofessional conduct or whose license has been procured by fraud or misrepresentation or issued by mistake. Unprofessional conduct shall include, but is not limited to, any of the following: (a) Gross immorality. (b) Incompetence. (c) Gross negligence. (d) The clearly excessive furnishing of controlled substances in violation of subdivision (a) of Section 11153 of the Health and Safety Code. (e) The clearly excessive furnishing of controlled substances in violation of subdivision (a) of Section 11153.5 of the Health and Safety Code. Factors to be considered in determining whether the furnishing of controlled substances is clearly excessive shall include, but not be limited to, the amount of controlled substances furnished, the previous ordering pattern of the customer (including size and frequency of orders), the type and size of the customer, and where and to whom the customer distributes its product. (f) The commission of any act involving moral turpitude, dishonesty, fraud, deceit, or corruption, whether the act is committed in the course of relations as a licensee or otherwise, and whether the act is a felony or misdemeanor or not. (g) Knowingly making or signing any certificate or other document that falsely represents the existence or nonexistence of a state of facts. (h) The administering to oneself, of any controlled substance, or the use of any dangerous drug or of alcoholic beverages to the extent or in a manner as to be dangerous or injurious to oneself, to a person holding a license under this chapter, or to any other person or to the public, or to the extent that the use impairs the ability of the person to conduct with safety to the public the practice authorized by the license. (i) Except as otherwise authorized by law, knowingly selling, furnishing, giving away, or administering or offering to sell, furnish, give away, or administer any controlled substance to an addict. (j) The violation of any of the statutes of this state or of the United States regulating controlled substances and dangerous drugs. (k) The conviction of more than one misdemeanor or any felony involving the use, consumption, or self-administration of any dangerous drug or alcoholic beverage, or any combination of those substances. (l) The conviction of a crime substantially related to the qualifications, functions, and duties of a licensee under this chapter. The record of conviction of a violation of Chapter 13 (commencing with Section 801) of Title 21 of the United States Code regulating controlled substances or of a violation of the statutes of this state regulating controlled substances or dangerous drugs shall be conclusive evidence of unprofessional conduct. In all other cases, the record of conviction shall be conclusive evidence only of the fact that the conviction occurred. The board may inquire into the circumstances surrounding the commission of the crime, in order to fix the degree of discipline or, in the case of a conviction not involving controlled substances or dangerous drugs, to determine if the conviction is of an offense substantially related to the qualifications, functions, and duties of a licensee under this chapter. A plea or verdict of guilty or a conviction following a plea of nolo contendere is deemed to be a conviction within the meaning of this provision. The board may take action when the time for appeal has elapsed, or the judgment of conviction has been affirmed on appeal or when an order granting probation is made suspending the imposition of sentence, irrespective of a subsequent order under Section 1203.4 of the Penal Code allowing the person to withdraw his or her plea of guilty and to enter a plea of not guilty, or setting aside the verdict of guilty, or dismissing the accusation, information, or indictment. (m) The cash compromise of a charge of violation of Chapter 13 (commencing with Section 801) of Title 21 of the United States Code regulating controlled substances or of Chapter 7 (commencing with Section 14000) of Part 3 of Division 9 of the Welfare and Institutions Code relating to the Medi-Cal program. The record of the compromise is conclusive evidence of unprofessional conduct. (n) The revocation, suspension, or other discipline by another state of a license to practice pharmacy, operate a pharmacy, or do any other act for which a license is required by this chapter. (o) Violating or attempting to violate, directly or indirectly, or assisting in or abetting the violation of or conspiring to violate any provision or term of this chapter or of the applicable federal and state laws and regulations governing pharmacy, including regulations established by the board. (p) Actions or conduct that would have warranted denial of a license. (q) Engaging in any conduct that subverts or attempts to subvert an investigation of the board. (r) The selling, trading, transferring, or furnishing of drugs obtained pursuant to Section 256b of Title 42 of the United States Code to any person a licensee knows or reasonably should have known, not to be a patient of a covered entity, as defined in paragraph (4) of subsection (a) of Section 256b of Title 42 of the United States Code. (s) This section shall become inoperative and is repealed on January 1, 2006, unless a later enacted statute, that becomes operative on or before January 1, 2006, amends or repeals that date. SEC. 44. Section 4301 is added to the Business and Professions Code, to read: 4301. The board shall take action against any holder of a license who is guilty of unprofessional conduct or whose license has been procured by fraud or misrepresentation or issued by mistake. Unprofessional conduct shall include, but is not limited to, any of the following: (a) Gross immorality. (b) Incompetence. (c) Gross negligence. (d) The clearly excessive furnishing of controlled substances in violation of subdivision (a) of Section 11153 of the Health and Safety Code. (e) The clearly excessive furnishing of controlled substances in violation of subdivision (a) of Section 11153.5 of the Health and Safety Code. Factors to be considered in determining whether the furnishing of controlled substances is clearly excessive shall include, but not be limited to, the amount of controlled substances furnished, the previous ordering pattern of the customer (including size and frequency of orders), the type and size of the customer, and where and to whom the customer distributes its product. (f) The commission of any act involving moral turpitude, dishonesty, fraud, deceit, or corruption, whether the act is committed in the course of relations as a licensee or otherwise, and whether the act is a felony or misdemeanor or not. (g) Knowingly making or signing any certificate or other document that falsely represents the existence or nonexistence of a state of facts. (h) The administering to oneself, of any controlled substance, or the use of any dangerous drug or of alcoholic beverages to the extent or in a manner as to be dangerous or injurious to oneself, to a person holding a license under this chapter, or to any other person or to the public, or to the extent that the use impairs the ability of the person to conduct with safety to the public the practice authorized by the license. (i) Except as otherwise authorized by law, knowingly selling, furnishing, giving away, or administering or offering to sell, furnish, give away, or administer any controlled substance to an addict. (j) The violation of any of the statutes of this state or of the United States regulating controlled substances and dangerous drugs. (k) The conviction of more than one misdemeanor or any felony involving the use, consumption, or self-administration of any dangerous drug or alcoholic beverage, or any combination of those substances. (l) The conviction of a crime substantially related to the qualifications, functions, and duties of a licensee under this chapter. The record of conviction of a violation of Chapter 13 (commencing with Section 801) of Title 21 of the United States Code regulating controlled substances or of a violation of the statutes of this state regulating controlled substances or dangerous drugs shall be conclusive evidence of unprofessional conduct. In all other cases, the record of conviction shall be conclusive evidence only of the fact that the conviction occurred. The board may inquire into the circumstances surrounding the commission of the crime, in order to fix the degree of discipline or, in the case of a conviction not involving controlled substances or dangerous drugs, to determine if the conviction is of an offense substantially related to the qualifications, functions, and duties of a licensee under this chapter. A plea or verdict of guilty or a conviction following a plea of nolo contendere is deemed to be a conviction within the meaning of this provision. The board may take action when the time for appeal has elapsed, or the judgment of conviction has been affirmed on appeal or when an order granting probation is made suspending the imposition of sentence, irrespective of a subsequent order under Section 1203.4 of the Penal Code allowing the person to withdraw his or her plea of guilty and to enter a plea of not guilty, or setting aside the verdict of guilty, or dismissing the accusation, information, or indictment. (m) The cash compromise of a charge of violation of Chapter 13 (commencing with Section 801) of Title 21 of the United States Code regulating controlled substances or of Chapter 7 (commencing with Section 14000) of Part 3 of Division 9 of the Welfare and Institutions Code relating to the Medi-Cal program. The record of the compromise is conclusive evidence of unprofessional conduct. (n) The revocation, suspension, or other discipline by another state of a license to practice pharmacy, operate a pharmacy, or do any other act for which a license is required by this chapter. (o) Violating or attempting to violate, directly or indirectly, or assisting in or abetting the violation of or conspiring to violate any provision or term of this chapter or of the applicable federal and state laws and regulations governing pharmacy, including regulations established by the board. (p) Actions or conduct that would have warranted denial of a license. (q) Engaging in any conduct that subverts or attempts to subvert an investigation of the board. (r) The selling, trading, transferring, or furnishing of drugs obtained pursuant to Section 256b of Title 42 of the United States Code to any person a licensee knows or reasonably should have known, not to be a patient of a covered entity, as defined in paragraph (4) of subsection (a) of Section 256b of Title 42 of the United States Code. (s) The clearly excessive furnishing of dangerous drugs by a wholesaler to a pharmacy that primarily or solely dispenses prescription drugs to patients of long-term care facilities. Factors to be considered in determining whether the furnishing of dangerous drugs is clearly excessive shall include, but not be limited to, the amount of dangerous drugs furnished to a pharmacy that primarily or solely dispenses prescription drugs to patients of long-term care facilities, the previous ordering pattern of the pharmacy, and the general patient population to whom the pharmacy distributes the dangerous drugs. That a wholesaler has established, and employs, a tracking system that complies with the requirements of subdivision (b) of Section 4164 shall be considered in determining whether there has been a violation of this subdivision. This provision shall not be interpreted to require a wholesaler to obtain personal medical information or be authorized to permit a wholesaler to have access to personal medical information except as otherwise authorized by Section 56 and following of the Civil Code. (t) This section shall become operative on January 1, 2006. SEC. 45. Section 4305.5 of the Business and Professions Code is amended to read: 4305.5. (a) Any person who has obtained a license to conduct a wholesaler or veterinary food-animal drug retailer, shall notify the board within 30 days of the termination of employment of any pharmacist or exemptee who takes charge of, or acts as manager of the licensee. Failure to notify the board within the 30-day period shall constitute grounds for disciplinary action. (b) Any person who has obtained a license to conduct a wholesaler or veterinary food-animal drug retailer, who willfully fails to notify the board of the termination of employment of any pharmacist or exemptee who takes charge of, or acts as manager of the licensee, and who continues to operate the licensee in the absence of a pharmacist or an exemptee approved for that location, shall be subject to summary suspension or revocation of his or her license to conduct a wholesaler or veterinary food-animal drug retailer. (c) Any pharmacist or exemptee who takes charge of, or acts as manager of a wholesaler or veterinary food-animal drug retailer, who terminates his or her employment at the licensee, shall notify the board within 30 days of the termination of employment. Failure to notify the board within the 30-day period shall constitute grounds for disciplinary action. (d) This section shall become inoperative and is repealed on January 1, 2006, unless a later enacted statute, that becomes operative on or before January 1, 2006, amends or repeals that date. SEC. 46. Section 4305.5 is added to the Business and Professions Code, to read: 4305.5. (a) A person who has obtained a license to conduct a wholesaler or veterinary food-animal drug retailer, shall notify the board within 30 days of the termination of employment of the designated representative-in-charge. Failure to notify the board within the 30-day period shall constitute grounds for disciplinary action. (b) A person who has obtained a license to conduct a wholesaler or veterinary food-animal drug retailer, who willfully fails to notify the board of the termination of employment of the designated representative-in-charge, and who continues to operate the licensee in the absence of the designated representative-in-charge for that location, shall be subject to summary suspension or revocation of his or her license to conduct a wholesaler or veterinary food-animal drug retailer. (c) A designated representative-in-charge of a wholesaler or veterinary food-animal drug retailer, who terminates his or her employment at the licensee, shall notify the board within 30 days of the termination of employment. Failure to notify the board within the 30-day period shall constitute grounds for disciplinary action. (d) This section shall become operative on January 1, 2006. SEC. 47. Section 4331 of the Business and Professions Code is amended to read: 4331. (a) Any person who is neither a pharmacist nor an exemptee and who takes charge of a wholesaler or veterinary food-animal drug retailer or who dispenses a prescription or furnishes dangerous devices except as otherwise provided in this chapter is guilty of a misdemeanor. (b) Any person who has obtained a license to conduct a veterinary food-animal drug retailer and who fails to place in charge of that veterinary food-animal drug retailer a pharmacist or exemptee, or any person who, by himself or herself, or by any other person, permits the dispensing of prescriptions, except by a pharmacist or exemptee, or as otherwise provided in this chapter, is guilty of a misdemeanor. (c) Any person who has obtained a license to conduct a wholesaler and who fails to place in charge of that wholesaler a pharmacist or exemptee, or any person who, by himself or herself, or by any other person, permits the furnishing of dangerous drugs or dangerous devices, except by a pharmacist or exemptee, or as otherwise provided in this chapter, is guilty of a misdemeanor. (d) This section shall become inoperative and is repealed on January 1, 2006, unless a later enacted statute, that becomes operative on or before January 1, 2006, amends or repeals that date. SEC. 48. Section 4331 is added to the Business and Professions Code, to read: 4331. (a) A person who is neither a pharmacist nor a designated representative and who takes charge of a wholesaler or veterinary food-animal drug retailer or who dispenses a prescription or furnishes dangerous devices except as otherwise provided in this chapter is guilty of a misdemeanor. (b) A person who has obtained a license to conduct a veterinary food-animal drug retailer and who fails to place in charge of that veterinary food-animal drug retailer a pharmacist or designated representative, or any person who, by himself or herself, or by any other person, permits the dispensing of prescriptions, except by a pharmacist or designated representative, or as otherwise provided in this chapter, is guilty of a misdemeanor. (c) A person who has obtained a license to conduct a wholesaler and who fails to place in charge of that wholesaler a pharmacist or designated representative, or any person who, by himself or herself, or by any other person, permits the furnishing of dangerous drugs or dangerous devices, except by a pharmacist or designated representative, or as otherwise provided in this chapter, is guilty of a misdemeanor. (d) This section shall become operative on January 1, 2006. SEC. 49. Section 4400 of the Business and Professions Code is amended to read: 4400. The amount of fees and penalties prescribed by this chapter, except as otherwise provided, is that fixed by the board according to the following schedule: (a) The fee for a nongovernmental pharmacy license shall be three hundred forty dollars ($340) and may be increased to four hundred dollars ($400). (b) The fee for a nongovernmental pharmacy or medical device retailer annual renewal shall be one hundred seventy-five dollars ($175) and may be increased to two hundred fifty dollars ($250). (c) The fee for the pharmacist application and examination shall be one hundred fifty-five dollars ($155) and may be increased to one hundred eighty-five dollars ($185). (d) The fee for regrading an examination shall be seventy-five dollars ($75) and may be increased to eighty-five dollars ($85). If an error in grading is found and the applicant passes the examination, the regrading fee shall be refunded. (e) The fee for a pharmacist license and biennial renewal shall be one hundred fifteen dollars ($115) and may be increased to one hundred fifty dollars ($150). (f) The fee for a wholesaler license and annual renewal shall be five hundred fifty dollars ($550) and may be increased to six hundred dollars ($600). (g) The fee for a hypodermic license and renewal shall be ninety dollars ($90) and may be increased to one hundred twenty-five dollars ($125). (h) The fee for application and investigation for an exemptee license under Section 4053 shall be seventy-five dollars ($75) and may be increased to one hundred dollars ($100), except for a veterinary food-animal drug retailer exemptee, for whom the fee shall be one hundred dollars ($100). (i) The fee for an exemptee license and annual renewal under Section 4053 shall be one hundred ten dollars ($110) and may be increased to one hundred fifty dollars ($150), except that the fee for the issuance of a veterinary food-animal drug retailer exemptee license shall be one hundred fifty dollars ($150), for renewal one hundred ten dollars ($110), which may be increased to one hundred fifty dollars ($150), and for filing a late renewal fifty-five dollars ($55). (j) The fee for an out-of-state drug distributor's license and annual renewal issued pursuant to Section 4120 shall be five hundred fifty dollars ($550) and may be increased to six hundred dollars ($600). (k) The fee for registration and annual renewal of providers of continuing education shall be one hundred dollars ($100) and may be increased to one hundred thirty dollars ($130). (l) The fee for evaluation of continuing education courses for accreditation shall be set by the board at an amount not to exceed forty dollars ($40) per course hour. (m) The fee for evaluation of applications submitted by graduates of foreign colleges of pharmacy or colleges of pharmacy not recognized by the board shall be one hundred sixty-five dollars ($165) and may be increased to one hundred seventy-five dollars ($175). (n) The fee for an intern license or extension shall be sixty-five dollars ($65) and may be increased to seventy-five dollars ($75). The fee for transfer of intern hours or verification of licensure to another state shall be fixed by the board not to exceed twenty dollars ($20). (o) The board may, by regulation, provide for the waiver or refund of the additional fee for the issuance of a certificate where the certificate is issued less than 45 days before the next succeeding regular renewal date. (p) The fee for the reissuance of any license, or renewal thereof, that has been lost or destroyed or reissued due to a name change is thirty dollars ($30). (q) The fee for the reissuance of any license, or renewal thereof, that must be reissued because of a change in the information, is sixty dollars ($60) and may be increased to one hundred dollars ($100). (r) It is the intent of the Legislature that, in setting fees pursuant to this section, the board shall seek to maintain a reserve in the Pharmacy Board Contingent Fund equal to approximately one year' s operating expenditures. (s) The fee for any applicant for a clinic permit is three hundred forty dollars ($340) and may be increased to four hundred dollars ($400) for each permit. The annual fee for renewal of the permit is one hundred seventy-five dollars ($175) and may be increased to two hundred fifty dollars ($250) for each permit. (t) The board shall charge a fee for the processing and issuance of a registration to a pharmacy technician and a separate fee for the biennial renewal of the registration. The registration fee shall be twenty-five dollars ($25) and may be increased to fifty dollars ($50). The biennial renewal fee shall be twenty-five dollars ($25) and may be increased to fifty dollars ($50). (u) The fee for a veterinary food-animal drug retailer license shall be four hundred dollars ($400). The annual renewal fee for a veterinary food-animal drug retailer shall be two hundred fifty dollars ($250). (v) The fee for issuance of a retired license pursuant to Section 4200.5 shall be thirty dollars ($30). (w) This section shall become inoperative and is repealed on January 1, 2006, unless a later enacted statute, that becomes operative on or before January 1, 2006, amends or repeals that date. SEC. 50. Section 4400 is added to the Business and Professions Code, to read: 4400. The amount of fees and penalties prescribed by this chapter, except as otherwise provided is that fixed by the board according to the following schedule: (a) The fee for a nongovernmental pharmacy license shall be three hundred forty dollars ($340) and may be increased to four hundred dollars ($400). (b) The fee for a nongovernmental pharmacy annual renewal shall be one hundred seventy-five dollars ($175) and may be increased to two hundred fifty dollars ($250). (c) The fee for the pharmacist application and examination shall be one hundred fifty-five dollars ($155) and may be increased to one hundred eighty-five dollars ($185). (d) The fee for regrading an examination shall be seventy-five dollars ($75) and may be increased to eighty-five dollars ($85). If an error in grading is found and the applicant passes the examination, the regrading fee shall be refunded. (e) The fee for a pharmacist license and biennial renewal shall be one hundred fifteen dollars ($115) and may be increased to one hundred fifty dollars ($150). (f) The fee for a wholesaler license and annual renewal shall be five hundred fifty dollars ($550) and may be increased to six hundred dollars ($600). (g) The fee for a hypodermic license and renewal shall be ninety dollars ($90) and may be increased to one hundred twenty-five dollars ($125). (h) The fee for application and investigation for a designated representative license issued pursuant to Section 4053 shall be seventy-five dollars ($75) and may be increased to one hundred dollars ($100), except for a veterinary food-animal drug retailer designated representative, for whom the fee shall be one hundred dollars ($100). (i) The fee for a designated representative license and annual renewal under Section 4053 shall be one hundred ten dollars ($110) and may be increased to one hundred fifty dollars ($150), except that the fee for the issuance of a veterinary food-animal drug retailer designated representative license shall be one hundred fifty dollars ($150), for renewal one hundred ten dollars ($110), which may be increased to one hundred fifty dollars ($150), and for filing a late renewal fifty-five dollars ($55). (j) The fee for a nonresident wholesaler's license and annual renewal issued pursuant to Section 4120 shall be five hundred fifty dollars ($550) and may be increased to six hundred dollars ($600). (k) The fee for registration and annual renewal of providers of continuing education shall be one hundred dollars ($100) and may be increased to one hundred thirty dollars ($130). (l) The fee for evaluation of continuing education courses for accreditation shall be set by the board at an amount not to exceed forty dollars ($40) per course hour. (m) The fee for evaluation of applications submitted by graduates of foreign colleges of pharmacy or colleges of pharmacy not recognized by the board shall be one hundred sixty-five dollars ($165) and may be increased to one hundred seventy-five dollars ($175). (n) The fee for an intern license or extension shall be sixty-five dollars ($65) and may be increased to seventy-five dollars ($75). The fee for transfer of intern hours or verification of licensure to another state shall be fixed by the board not to exceed twenty dollars ($20). (o) The board may, by regulation, provide for the waiver or refund of the additional fee for the issuance of a certificate where the certificate is issued less than 45 days before the next succeeding regular renewal date. (p) The fee for the reissuance of any license, or renewal thereof, that has been lost or destroyed or reissued due to a name change is thirty dollars ($30). (q) The fee for the reissuance of any license, or renewal thereof, that must be reissued because of a change in the information, is sixty dollars ($60) and may be increased to one hundred dollars ($100). (r) It is the intent of the Legislature that, in setting fees pursuant to this section, the board shall seek to maintain a reserve in the Pharmacy Board Contingent Fund equal to approximately one year' s operating expenditures. (s) The fee for any applicant for a clinic permit is three hundred forty dollars ($340) and may be increased to four hundred dollars ($400) for each permit. The annual fee for renewal of the permit is one hundred seventy-five dollars ($175) and may be increased to two hundred fifty dollars ($250) for each permit. (t) The board shall charge a fee for the processing and issuance of a registration to a pharmacy technician and a separate fee for the biennial renewal of the registration. The registration fee shall be twenty-five dollars ($25) and may be increased to fifty dollars ($50). The biennial renewal fee shall be twenty-five dollars ($25) and may be increased to fifty dollars ($50). (u) The fee for a veterinary food-animal drug retailer license shall be four hundred dollars ($400). The annual renewal fee for a veterinary food-animal drug retailer shall be two hundred fifty dollars ($250). (v) The fee for issuance of a retired license pursuant to Section 4200.5 shall be thirty dollars ($30). (w) This section shall become operative on January 1, 2006. SEC. 51. This act shall become operative only if Assembly Bill 2682 is also enacted and becomes effective on or before January 1, 2005. SEC. 52. Sections 10.5 and 11.5 of this bill incorporate amendments to Section 4059.5 of the Business and Professions Code proposed by both this bill and SB 1913. Sections 10.5 and 11.5 shall only become operative if (1) both bills are enacted and become effective on or before January 1, 2005, (2) each bill amends Section 4059.5 of the Business and Professions Code, and (3) this bill is enacted after SB 1913, in which case Sections 10 and 11 of this bill shall not become operative. SEC. 53. Sections 12.5 and 13.5 of this bill incorporate amendments to Section 4081 of the Business and Professions Code proposed by both this bill and SB 1913. Sections 12.5 and 13.5 shall only become operative if (1) both bills are enacted and become effective on or before January 1, 2005, (2) each bill amends Section 4081 of the Business and Professions Code, and (3) this bill is enacted after SB 1913, in which case Sections 12 and 13 of this bill shall not become operative. SEC. 54. No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.