BILL ANALYSIS                                                                                                                                                                                                    


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                                    THIRD READING

          Bill No:  AB 1709
          Author:   Conway (R)
          Amended:  8/17/10 in Senate
          Vote:     21

          AYES:  Florez, Emmerson, Hancock, Hollingsworth, Wolk

           SENATE APPROPRIATIONS COMMITTEE  :  Senate Rule 28.8

           ASSEMBLY FLOOR  :  72-0, 5/20/10 (Consent) - See last page  
            for vote

           SUBJECT  :    Biologics: animal blood and blood component  
                      commercial blood banks for animals 

           SOURCE  :     Department of Food and Agriculture

           DIGEST  :    This bill deletes the current veterinary  
          biologics licensing law and replaces it with licensing  
          requirements for animal blood banks.

           Senate Floor Amendments  of 8/17/10 change the date for  
          transition of the state biologics program to the federal  
          biologics program from December 31, 2010 to January 1,  
          2013.  Further, requires the California Department of Food  
          and Agriculture (CDFA) to assist transitioning biologic  
          products from the California program to licensing under the  
          federal program, and also requires CDFA to assist with the  


                                                               AB 1709

          federal licensing of developing biologic products.

           ANALYSIS  :    CDFA Veterinary Biologics Program (biologics  
          program) was established in 1974 as a result of the 1971-72  
          Exotic Newcastle Disease outbreak in Southern California.   
          The program was modeled after the United States Department  
          of Agriculture's (USDA) Center for Veterinary Biologics  
          Program.  The program licensed biologics products used in  
          California and ensured that all available veterinary  
          biologics were safe, pure, potent, and efficacious.  CDFA  
          has one veterinarian and $120,000 of General Fund dedicated  
          primarily to the biologics program.  Biologic products are  
          medications that activate an animal's immune system  
          response to fight off a disease.

          Current law defines biologics as: "the following products  
          which are used for the diagnosis and detection of and for  
          the prevention or treatment of, disease in animals other  
          than man:  serum, blood, vaccines, live vaccines, killed  
          vaccine, tissue vaccine, autogenous vaccine, live virus,  
          killed virus, live bacterial culture, killed bacterial  
          culture, bacterin, hormone, tissue extract, gland extract,  
          gland preparation, insulin, and similar products made from  
          human or animal tissues or microorganisms.  

          In 1985, the federal government amended the  
          Virus-Serum-Toxin Act authorizing USDA to regulate  
          intrastate, as well as interstate, movement of biological  
          products and broadened their authority to issue  
          regulations.  Regulations were implemented for an exemption  
          from the federal licensure for products produced under an  
          approved state program for exclusive use in the state.   
          California obtained USDA approval for this exemption and is  
          the only state currently holding this exemption for a state  
          biologics program.  

          Currently, there are three licensed biologic companies in  
          California that are also licensed under USDA's Center for  
          Veterinary Biologics Program.  There are 10 biologic  
          products that are licensed for use in California and could  
          be approved for use by USDA under conditional restricted  
          use in order for their continued use within California.  

          SB 1342 (Kuehl), Chapter 822, Statutes of 2002, establishes  



                                                               AB 1709

          additional protocols for commercial blood banks for animals  
          that are licensed by the CDFA.

          This bill:

          1. Prohibits a person from engaging in the production of  
             biologics unless they have a valid permit or license  
             from the USDA.

          2. Requires the CDFA to submit to the Legislature by June  
             1, 2011, a report on the status of the transition of  
             biologics licenses to the federal government.  In  
             addition, requires CDFA to report annually on the  
             transition until this bill's provisions become  
             operative, and to post that fact on its Internet Web  

          3. States that this act will not become operative until the  
             first day on or after January 1, 2013, that all  
             California biological products registered with the CDFA  
             by December 31, 2010, have obtained a United States  
             Veterinary Biological product License from the United  
             States Department of Agriculture Center for Veterinary  
             Biologics except those products for which the CDFA has  
             received written documentation from a firm that the firm  
             has chosen not to obtain that license.

          4. Requires CDFA to assist towards federal biological  
             products licensure.

          CDFA is sponsoring this bill to eliminate the current state  
          biologics program without impacting the program for  
          commercial blood banks for animals and transition  
          California to the federal biologics program to address  
          funding shortfalls in the current state program.  Based on  
          a recent USDA audit of the California biologics program, it  
          is estimated that the cost to maintain a federally  
          compliant program would be approximately $428,000 and three  
          personnel years, further training or special recruitment at  
          higher salaries than are currently allowable, and  
          contracting with a private laboratory for regulatory  
          testing of products.  Without sufficient funding of this  



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          bill, CDFA is unable to maintain sufficient oversight which  
          could result in a potentially disruptive action by USDA to  
          disallow the California exemption to the federal biologics  

           FISCAL EFFECT  :    Appropriation:  No   Fiscal Com.:  Yes    
          Local:  Yes

           SUPPORT  :   (Verified  8/18/10)

          California Department of Food and Agriculture (source)
          Animal Blood Bank
          California Veterinary Medical Association

           ASSEMBLY FLOOR  : 
          AYES:  Adams, Ammiano, Anderson, Arambula, Bass, Beall,  
            Bill Berryhill, Tom Berryhill, Blakeslee, Block,  
            Blumenfield, Bradford, Brownley, Buchanan, Caballero,  
            Charles Calderon, Carter, Chesbro, Conway, Cook, Coto,  
            Davis, De Leon, DeVore, Emmerson, Eng, Feuer, Fong,  
            Fuentes, Fuller, Furutani, Gaines, Galgiani, Garrick,  
            Gilmore, Hagman, Hall, Hayashi, Hernandez, Hill, Huber,  
            Huffman, Jeffries, Jones, Knight, Lieu, Logue, Bonnie  
            Lowenthal, Ma, Mendoza, Miller, Monning, Nestande,  
            Niello, Nielsen, Norby, V. Manuel Perez, Portantino,  
            Ruskin, Salas, Saldana, Silva, Skinner, Smyth, Solorio,  
            Audra Strickland, Swanson, Torlakson, Torres, Torrico,  
            Tran, Yamada
          NO VOTE RECORDED:  De La Torre, Evans, Fletcher, Harkey,  
            Nava, Villines, John A. Perez, Vacancy

          TSM:do  8/18/10   Senate Floor Analyses 

                         SUPPORT/OPPOSITION:  SEE ABOVE

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