BILL NUMBER: SB 1307 CHAPTERED
BILL TEXT
CHAPTER 713
FILED WITH SECRETARY OF STATE SEPTEMBER 30, 2008
APPROVED BY GOVERNOR SEPTEMBER 30, 2008
PASSED THE SENATE AUGUST 21, 2008
PASSED THE ASSEMBLY AUGUST 18, 2008
AMENDED IN ASSEMBLY AUGUST 14, 2008
AMENDED IN ASSEMBLY JUNE 17, 2008
AMENDED IN SENATE MAY 23, 2008
AMENDED IN SENATE APRIL 29, 2008
AMENDED IN SENATE MARCH 25, 2008
INTRODUCED BY Senator Ridley-Thomas
FEBRUARY 20, 2008
An act to amend Sections 4033, 4034, 4162, 4162.5, and 4163 of, to
add Sections 4034.1, 4044, 4045, 4163.1, 4163.2, 4163.3, and 4163.4
to, and to repeal and add Section 4163.5 of, the Business and
Professions Code, relating to pharmacy.
LEGISLATIVE COUNSEL'S DIGEST
SB 1307, Ridley-Thomas. Pharmacy: pedigree.
Existing law, the Pharmacy Law, provides for the licensure and
regulation of the practice of pharmacy and the sale of dangerous
drugs or dangerous devices by the California State Board of Pharmacy,
in the Department of Consumer Affairs. Under existing law, on and
after January 1, 2009, pedigree means an electronic record 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 one or more wholesalers,
manufacturers, or pharmacies, until final sale to a pharmacy or other
person furnishing, administering, or dispensing the dangerous drug.
On and after January 1, 2009, existing law prohibits a wholesaler or
pharmacy from selling, trading, or transferring a dangerous drug
without a pedigree or from acquiring a dangerous drug without
receiving a pedigree. Existing law, on and after January 1, 2009,
requires that a pedigree include certain information, including, but
not limited to, the source of the dangerous drug and the trade or
generic name of the drug. Existing law exempts specified transactions
from the pedigree requirement, and authorizes the board to extend
the January 1, 2009, compliance date to January 1, 2011, in specified
circumstances. Existing law makes it a crime to knowingly violate
the Pharmacy Law.
This bill would instead, on and after January 1, 2015, define a
pedigree, as specified, and would revise the information required to
be contained in a pedigree to, among other things, include a
specified unique identification number.
The bill would prohibit a wholesaler or repackager, as defined, on
and after July 1, 2016, or a pharmacy, on and after July 1, 2017,
from selling, trading, or transferring a dangerous drug without a
pedigree or from acquiring a dangerous drug without receiving a
pedigree, except as specified. The bill would prohibit a pharmacy
warehouse, as defined, on and after July 1, 2017, from acquiring a
dangerous drug without receiving a pedigree. The bill would delete
the board's authority to extend these compliance dates. The bill
would also prohibit a repackager or pharmacy from furnishing a
dangerous drug or dangerous device to an unauthorized person. The
bill would require a manufacturer of a dangerous drug distributed in
California to designate certain percentages of the drugs that it
manufactures to comply with the pedigree requirement by specified
dates, and to notify the board of the drugs so designated and of the
technology to be used to meet that requirement. The bill would also
revise certain exemptions from the pedigree requirement and would
exempt specified additional transactions from the pedigree
requirement.
The bill would authorize a manufacturer, wholesaler, or pharmacy
in possession of dangerous drugs manufactured or distributed prior to
the operative date of the pedigree requirements to designate those
drugs as not subject to the requirements by preparing a specified
written declaration under penalty of perjury, which would be
considered trade secrets and kept confidential by the board. The bill
would authorize dangerous drugs designated on such a declaration to
be purchased, sold, acquired, returned, or otherwise transferred,
without meeting the pedigree requirements if the transfer complies
with specified requirements. Because a knowing violation of the bill'
s provisions would be a crime under the Pharmacy Law and because the
bill would expand the crime of perjury, the bill would impose a
state-mandated local program.
The bill would require the board to promulgate regulations
defining the circumstances under which participants in the
distribution chain may infer the contents of a case, pallet, or other
aggregate of individual units, packages, or containers of dangerous
drugs, from a unique identifier associated with the case, pallet, or
other aggregate, if certain standard operating procedures are
complied with and made available for the board to review. The bill
would require board regulations to specify liability associated with
accuracy of product information and pedigree using inference. The
bill would declare the intent of the Legislature in this regard.
The bill would make the pedigree requirements inoperative upon the
effective date of federal law addressing pedigree or serialization
measures for dangerous drugs, or as otherwise specified in the event
of a conflict with federal law.
Existing law requires an applicant for issuance or renewal of a
wholesaler or nonresident wholesaler license to submit a surety bond
of $100,000 or an equivalent means of security to secure payment of
any administrative fines and costs imposed by the board. Existing law
makes this requirement inoperative and repeals it on January 1,
2015.
This bill would delete the date upon which these provisions become
inoperative and are repealed.
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.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 4033 of the Business and Professions Code is
amended to read:
4033. (a) (1) "Manufacturer" means and includes every person who
prepares, derives, produces, compounds, or repackages any drug or
device except a pharmacy that manufactures on the immediate premises
where the drug or device is sold to the ultimate consumer.
(2) Notwithstanding paragraph (1), "manufacturer" shall not mean a
pharmacy compounding a drug for parenteral therapy, pursuant to a
prescription, for delivery to another pharmacy for the purpose of
delivering or administering the drug to the patient or patients named
in the prescription, provided that neither the components for the
drug nor the drug are compounded, fabricated, packaged, or otherwise
prepared prior to receipt of the prescription.
(3) Notwithstanding paragraph (1), "manufacturer" shall not mean a
pharmacy that, at a patient's request, repackages a drug previously
dispensed to the patient, or to the patient's agent, pursuant to a
prescription.
(b) Notwithstanding subdivision (a), as used in Sections 4034,
4163, 4163.1, 4163.2, 4163.3, 4163.4, and 4163.5, "manufacturer"
means a person who prepares, derives, manufactures, produces, or
repackages a dangerous drug, as defined in Section 4022, device, or
cosmetic. Manufacturer also means the holder or holders of a New Drug
Application (NDA), an Abbreviated New Drug Application (ANDA), or a
Biologics License Application (BLA), provided that such application
has been approved; a manufacturer's third party logistics provider; a
private label distributor (including colicensed partners) for whom
the private label distributor's prescription drugs are originally
manufactured and labeled for the distributor and have not been
repackaged; or the distributor agent for the manufacturer, contract
manufacturer, or private label distributor, whether the establishment
is a member of the manufacturer's affiliated group (regardless of
whether the member takes title to the drug) or is a contract
distributor site.
SEC. 2. Section 4034 of the Business and Professions Code is
amended 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 one or more
wholesalers, manufacturers, repackagers, or pharmacies, until final
sale to a pharmacy or other person furnishing, administering, or
dispensing the dangerous drug. The pedigree shall be created and
maintained in an interoperable electronic system, ensuring
compatibility throughout all stages of distribution.
(b) A pedigree shall include all of the following information:
(1) The source of the dangerous drug, including the name, the
federal manufacturer's registration number or a state license number
as determined by the board, and principal address of the source.
(2) The trade or generic name of the dangerous drug, the quantity
of the dangerous drug, its dosage form and strength, the date of the
transaction, the sales invoice number or, if not immediately
available, a customer-specific shipping reference number linked to
the sales invoice number, the container size, the number of
containers, the expiration dates, and the lot numbers.
(3) The business name, address, and the federal manufacturer's
registration number or a state license number as determined by the
board, 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.
(5) The unique identification number described in subdivision (i).
(c) A single pedigree shall include every change of ownership of a
given dangerous drug from its initial manufacture through to its
final transaction to a pharmacy or other person for furnishing,
administering, or dispensing the drug, regardless of repackaging or
assignment of another National Drug Code (NDC) Directory number.
Dangerous drugs that are repackaged shall be serialized by the
repackager and a pedigree shall be provided that references the
pedigree of the original package or packages provided by the
manufacturer.
(d) A pedigree shall track each dangerous drug at the smallest
package or immediate container distributed by the manufacturer,
received and distributed by the wholesaler or repackager, and
received by the pharmacy or another person furnishing, administering,
or dispensing the dangerous drug. For purposes of this section, the
"smallest package or immediate container" of a dangerous drug shall
include any dangerous drug package or container made available to a
repackager, wholesaler, pharmacy, or other entity for repackaging or
redistribution, as well as the smallest unit made by the manufacturer
for sale to the pharmacy or other person furnishing, administering,
or dispensing the drug.
(e) Any return of a dangerous drug to a wholesaler or manufacturer
shall be documented on the same pedigree as the transaction that
resulted in the receipt of the drug by the party returning it.
(f) 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.
(g) The following transactions are exempt from the pedigree
requirement created by this section:
(1) An intracompany sale or transfer of a dangerous drug. For
purposes of this section, "intracompany sale or transfer" means any
transaction for any valid business purpose between a division,
subsidiary, parent, or affiliated or related company under the common
ownership and control of the same corporate or legal entity.
(2) Dangerous drugs received by the state or a local government
entity from a department or agency of the federal government or an
agent of the federal government specifically authorized to deliver
dangerous drugs to the state or local government entity.
(3) The provision of samples of dangerous drugs by a manufacturer'
s employee to an authorized prescriber, provided the samples are
dispensed to a patient of the prescriber without charge.
(4) (A) A sale, trade, or transfer of a radioactive drug, as
defined in Section 1708.3 of Title 16 of the California Code of
Regulations, between any two entities licensed by the Radiologic
Health Branch of the State Department of Public Health, the federal
Nuclear Regulatory Commission, or an Agreement state.
(B) The exemption in this paragraph shall remain in effect unless
the board, no earlier than the date that is two years after the
compliance date for manufacturers set forth in subdivision (k) of
Section 4034 or Section 4163.5, determines after consultation with
the Radiologic Health Branch of the State Department of Public Health
that the risk of counterfeiting or diversion of a radioactive drug
is sufficient to require a pedigree. Two years following the date of
any such determination, this paragraph shall become inoperative.
(5) The sale, trade, or transfer of a dangerous drug that is
labeled by the manufacturer as "for veterinary use only."
(6) The sale, trade, or transfer of compressed medical gas. For
purposes of this section, "compressed medical gas" means any
substance in its gaseous or cryogenic liquid form that meets medical
purity standards and has application in a medical or homecare
environment, including, but not limited to, oxygen and nitrous oxide.
(7) The sale, trade, or transfer of solutions. For purposes of
this section, "solutions" means any of the following:
(A) Those intravenous products that, by their formulation, are
intended for the replenishment of fluids and electrolytes, such as
sodium, chloride, and potassium, calories, such as dextrose and amino
acids, or both.
(B) Those intravenous products used to maintain the equilibrium of
water and minerals in the body, such as dialysis solutions.
(C) Products that are intended for irrigation or reconstitution,
as well as sterile water, whether intended for those purposes or for
injection.
(8) Dangerous drugs that are placed in a sealed package with a
medical device or medical supplies at the point of first shipment
into commerce by the manufacturer and the package remains sealed
until the drug and device are used, provided that the package is only
used for surgical purposes.
(9) A product that meets either of the following criteria:
(A) A product comprised of two or more regulated components, such
as a drug/device, biologic/device, or drug/device/biologic, that are
physically, chemically, or otherwise combined or mixed and produced
as a single entity.
(B) Two or more separate products packaged together in a single
package or as a unit and comprised of drug and device products or
device and biological products.
(h) If a manufacturer, wholesaler, or pharmacy has reasonable
cause to believe that a dangerous drug in, or having been in, its
possession is counterfeit or the subject of a fraudulent transaction,
the manufacturer, wholesaler, or pharmacy shall notify the board
within 72 hours of obtaining that knowledge. This subdivision shall
apply to any dangerous drug that has been sold or distributed in or
through this state.
(i) "Interoperable electronic system" as used in this chapter
means an electronic track and trace system for dangerous drugs that
uses a unique identification number, established at the point of
manufacture and supplemented by a linked unique identification number
in the event that drug is repackaged, contained within a
standardized nonproprietary data format and architecture, that is
uniformly used by manufacturers, wholesalers, repackagers, and
pharmacies for the pedigree of a dangerous drug. No particular data
carrier or other technology is mandated to accomplish the attachment
of the unique identification number described in this subdivision.
(j) The application of the pedigree requirement shall be subject
to review during the board's evaluation pursuant to Section 473.4.
(k) This section shall become operative on January 1, 2015.
SEC. 3. Section 4034.1 is added to the Business and Professions
Code, to read:
4034.1. (a) (1) Upon the effective date of federal legislation or
adoption of a federal regulation addressing pedigree or
serialization measures for dangerous drugs, Sections 4034, 4163,
4163.1, 4163.2, 4163.4, and 4163.5 shall become inoperative.
(2) Within 90 days of the enactment of federal legislation or
adoption of a regulation addressing pedigree or serialization
measures for dangerous drugs, the board shall publish a notice that
Sections 4034, 4163, 4163.1, 4163.2, 4163.4, and 4163.5 are
inoperative.
(3) Within 90 days of the enactment of federal legislation or
adoption of a regulation that is inconsistent with any provision of
California law governing the application of any pedigree or
serialization requirement or standard, the board shall adopt
emergency regulations necessary to reflect the inoperation of state
law.
(b) (1) If the Food and Drug Administration (FDA) enacts any rule,
standard, or takes any other action that is inconsistent with any
provision of California law governing application of a pedigree to a
dangerous drug, that provision of California law shall be
inoperative.
(2) Within 90 days of the FDA enacting any rule, standard, or
taking any other action that is inconsistent with any provision of
California law governing application of a pedigree to a dangerous
drug, the board shall publish a notice that the provision is
inoperative.
(3) Within 90 days of the FDA enacting any rule, standard, or
taking any other action that is inconsistent with any provision of
California law governing application of a pedigree to a dangerous
drug, the board shall adopt emergency regulations necessary to
reflect the inoperation of state law.
(c) If the board fails to recognize the inoperation within 90 days
pursuant to this section, nothing in this section shall preclude a
party from filing an action in state or federal court for declaratory
or injunctive relief as an alternative to filing a petition with the
board.
SEC. 4. Section 4044 is added to the Business and Professions
Code, to read:
4044. "Repackager" means a person or entity that is registered
with the federal Food and Drug Administration as a repackager and
operates an establishment that packages finished drugs from bulk or
that repackages dangerous drugs into different containers, excluding
shipping containers.
SEC. 5. Section 4045 is added to the Business and Professions
Code, to read:
4045. "Third-party logistics provider" or "reverse third-party
logistic provider" means an entity licensed as a wholesaler that
contracts with a dangerous drug manufacturer to provide or coordinate
warehousing, distribution, or other similar services on behalf of a
manufacturer, but for which there is no change of ownership in the
dangerous drugs. For purposes of Sections 4034, 4163, 4163.1, 4163.2,
4163.3, 4163.4, and 4163.5, a third-party logistics provider shall
not be responsible for generating or updating pedigree documentation,
but shall maintain copies of the pedigree. To be exempt from
documentation for pedigrees, a reverse third-party logistic provider
may only accept decommissioned drugs from pharmacies or wholesalers.
SEC. 6. Section 4162 of the Business and Professions Code is
amended to read:
4162. (a) (1) An applicant, that is not a government owned and
operated wholesaler, 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.
SEC. 7. Section 4162.5 of the Business and Professions Code is
amended to read:
4162.5. (a) (1) An applicant for the issuance or renewal of a
nonresident wholesaler license shall submit a surety bond of one
hundred thousand dollars ($100,000), or other equivalent means of
security acceptable to the board, such as an irrevocable letter of
credit, or a deposit in a trust account or financial institution,
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 nonresident
wholesaler is ten million dollars ($10,000,000) or less in which the
surety bond shall be twenty-five thousand dollars ($25,000).
(3) For applicants who satisfy paragraph (2), the board may
require a bond up to one hundred thousand dollars ($100,000) for any
nonresident wholesaler who has been disciplined by any state or
federal agency or has been issued an administrative fine pursuant to
this chapter.
(4) A person to whom an approved new drug application or a
biologics license 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 or biologics license application, and is licensed or
applies for licensure as a nonresident wholesaler, shall not be
required to post a surety bond as provided in this section.
(b) The board may make a claim against the bond if the licensee
fails to pay a fine within 30 days of the issuance of the fine or
when the 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.
SEC. 8. Section 4163 of the Business and Professions Code is
amended to read:
4163. (a) A manufacturer, wholesaler, repackager, or pharmacy 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) Except as otherwise provided in Section 4163.5, commencing on
July 1, 2016, a wholesaler or repackager may not sell, trade, or
transfer a dangerous drug at wholesale without providing a pedigree.
(d) Except as otherwise provided in Section 4163.5, commencing on
July 1, 2016, a wholesaler or repackager may not acquire a dangerous
drug without receiving a pedigree.
(e) Except as otherwise provided in Section 4163.5, commencing on
July 1, 2017, a pharmacy may not sell, trade, or transfer a dangerous
drug at wholesale without providing a pedigree.
(f) Except as otherwise provided in Section 4163.5, commencing on
July 1, 2017, a pharmacy may not acquire a dangerous drug without
receiving a pedigree.
(g) Except as otherwise provided in Section 4163.5, commencing on
July 1, 2017, a pharmacy warehouse may not acquire a dangerous drug
without receiving a pedigree. For purposes of this section and
Section 4034, a "pharmacy warehouse" means a physical location
licensed as a wholesaler for prescription drugs that acts as a
central warehouse and performs intracompany sales or transfers of
those drugs to a group of pharmacies under common ownership and
control.
SEC. 9. Section 4163.1 is added to the Business and Professions
Code, to read:
4163.1. (a) For purposes of Sections 4034 and 4163, "drop
shipment" means a sale of a dangerous drug by the manufacturer of the
dangerous drug whereby all of the following occur:
(1) The pharmacy, or other person authorized by law to dispense or
administer the drug, receives delivery of the dangerous drug
directly from the manufacturer.
(2) The wholesale distributor takes ownership of, but not physical
possession of, the dangerous drug.
(3) The wholesale distributor invoices the pharmacy or other
person authorized by law to dispense or administer the drug in place
of the manufacturer.
(b) The board may develop regulations to establish an alternative
process to convey the pedigree information required in Section 4034
for dangerous drugs that are sold by drop shipment.
SEC. 10. Section 4163.2 is added to the Business and Professions
Code, to read:
4163.2. (a) (1) A manufacturer, wholesaler, or pharmacy lawfully
possessing or owning dangerous drugs manufactured or distributed
prior to the operative date of the pedigree requirements, specified
in Sections 4034 and 4163, may designate these dangerous drugs as not
subject to the pedigree requirements by preparing a written
declaration made under penalty of perjury that lists those dangerous
drugs.
(2) The written declaration shall include the National Drug Code
Directory lot number for each dangerous drug designated. The written
declaration shall be submitted to and received by the board no later
than 30 days after the operative date of the pedigree requirements.
The entity or person submitting the written declaration shall also
retain for a period of three years and make available for inspection
by the board a copy of each written declaration submitted.
(3) The board may, by regulation, further specify the requirements
and procedures for the creation and submission of these written
declarations. Information contained in these declarations shall be
considered trade secrets and kept confidential by the board.
(b) Any dangerous drugs designated on a written declaration
timely created and submitted to the board may be purchased, sold,
acquired, returned, or otherwise transferred without meeting the
pedigree requirements, if the transfer complies with the other
requirements of this chapter.
SEC. 11. Section 4163.3 is added to the Business and Professions
Code, to read:
4163.3. (a) It is the intent of the Legislature that participants
in the distribution chain for dangerous drugs, including
manufacturers, wholesalers, or pharmacies furnishing, administering,
or dispensing dangerous drugs, distribute and receive electronic
pedigrees, and verify and validate the delivery and receipt of
dangerous drugs against those pedigrees at the unit level, in a
manner that maintains the integrity of the pedigree system without an
unacceptable increase in the risk of diversion or counterfeiting.
(b) To meet this goal, and to facilitate efficiency and safety in
the distribution chain, the board shall, by regulation, define the
circumstances under which participants in the distribution chain may
infer the contents of a case, pallet, or other aggregate of
individual units, packages, or containers of dangerous drugs, from a
unique identifier associated with the case, pallet, or other
aggregate, without opening each case, pallet, or other aggregate or
otherwise individually validating each unit.
(c) Manufacturers, wholesalers, and pharmacies opting to employ
the use of inference as authorized by the board to comply with the
pedigree requirements shall document their processes and procedures
in their standard operating procedures (SOPs) and shall make those
SOPs available for board review.
(d) SOPs regarding inference shall include a process for
statistically sampling the accuracy of information sent with inbound
product.
(e) Liability associated with accuracy of product information and
pedigree using inference shall be specified in the board's
regulations.
SEC. 12. Section 4163.4 is added to the Business and Professions
Code, to read:
4163.4. (a) All units of dangerous drug in the possession of a
wholesaler or pharmacy, for which the manufacturer does not hold
legal title on the effective date of the pedigree requirement set
forth in Section 4163.5, shall not be subject to the pedigree
requirements set forth in Sections 4034 and 4163. However, if any
units of those drugs are subsequently returned to the manufacturer,
they shall be subject to the pedigree requirements if the
manufacturer distributes those units in California.
(b) All units of dangerous drug manufactured in California but
distributed outside the state for dispensing outside the state shall
not be subject to the pedigree requirements set forth in Sections
4034 and 4163 at either the time of initial distribution or in the
event that any of those units are subsequently returned to the
manufacturer.
SEC. 13. Section 4163.5 of the Business and Professions Code is
repealed.
SEC. 14. Section 4163.5 is added to the Business and Professions
Code, to read:
4163.5. (a) The Legislature hereby finds and declares that:
(1) The electronic pedigree system required by Sections 4034 and
4163 will provide tremendous benefits to the public and to all
participants in the distribution chain. Those benefits should be made
available as quickly as possible through the full cooperation of
prescription drug supply chain participants. To this end, all drug
manufacturers and repackagers are strongly encouraged to serialize
drug products and initiate electronic pedigrees as soon as possible,
and all participants in the supply chain are encouraged to
immediately ready themselves to receive and pass electronic
pedigrees.
(2) At the same time, it is recognized that the process of
implementing serialized electronic pedigree for all prescription
drugs in the entire chain of distribution is a complicated
technological and logistical undertaking for manufacturers,
wholesalers, repackagers, pharmacies, and other supply chain
participants. The Legislature seeks to ensure continued availability
of prescription drugs in California while participants implement
these requirements.
(b) Before January 1, 2015, each manufacturer of a dangerous drug
distributed in California shall designate those dangerous drugs
representing a minimum of 50 percent of its drugs, generic or single
source, distributed in California, for which it is listed as the
manufacturer by the federal Food and Drug Administration, which shall
be the subject of its initial phase of compliance with the January
1, 2015, deadline of the state's serialized electronic pedigree
requirements set forth in Sections 4034 and 4163. Each manufacturer
shall notify the Board of Pharmacy of the drugs so designated and the
measure or measures used in designating its drugs to be serialized,
and shall include in the notification the technology to be used to
meet the serialized electronic pedigree requirements. The
notification process for these specific actions may be specified by
the board.
(c) Before January 1, 2016, each manufacturer of a dangerous drug
distributed in California shall designate the final 50 percent of its
drugs, generic or single source, distributed in California for which
it is listed as the manufacturer by the federal Food and Drug
Administration that
are subject to the state's serialized electronic pedigree
requirements set forth in Sections 4034 and 4163, which shall comply
with the state's serialized electronic pedigree requirement by
January 1, 2016. Each manufacturer shall notify the Board of Pharmacy
of the drugs so designated and the measure or measures used in
designating its drugs to be serialized, and shall include in the
notification the technology to be used to meet the serialized
electronic pedigree requirements. The notification process for these
specific actions may be specified by the board.
(d) For purposes of designating drugs to be serialized as required
by subdivisions (b) and (c), manufacturers shall select from any of
the following measures:
(1) Unit volume.
(2) Product package (SKU) type.
(3) Drug product family.
(e) Drugs not subject to compliance with the pedigree requirements
set forth in Sections 4034 and 4163 under this section shall not be
subject to the provisions of subdivisions (c), (d), (e), and (f) of
Section 4163.
SEC. 15. 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.