BILL NUMBER: SB 343	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senator Alquist

                        FEBRUARY 25, 2009

   An act to add Section 125293 to the Health and Safety Code,
relating to stem cells.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 343, as introduced, Alquist. Stem cell research: intellectual
property standards.
   The California Stem Cell Research and Cures Act, an initiative
measure approved by the voters at the November 2, 2004, statewide
general election as Proposition 71, establishes the California
Institute for Regenerative Medicine (CIRM), the purpose of which is,
among other things, to make grants and loans for stem cell research,
for research facilities, and for other vital research opportunities
to realize therapies, protocols, and medical procedures that will
result in the cure for, or substantial mitigation of, diseases and
injuries. Existing law establishes the Independent Citizen's
Oversight Committee (ICOC) composed of appointed members, that is
required to perform various functions and duties with regard to the
operation of the institute, including, but not limited to,
establishing standards applicable to research funded by the
institute. Existing law prohibits amendment of Proposition 71 by the
Legislature unless the amendment is approved by the voters, or the
amendment is accomplished by a bill introduced after the first 2 full
calendar years and approved by a vote of 70% of both houses, and
only if the amendment enhances the ability of the institute to
further the purposes of the grant and loan programs.
   The act provides that the ICOC shall establish standards that
require that all grants and loan awards under the act shall be
subject to intellectual property agreements that balance the
opportunity of the state to benefit from the patents, royalties, and
licenses that result from basic research, therapy development, and
clinical trials with the need to ensure that essential medical
research is not unreasonably hindered by the intellectual property
agreements.
   This bill would require that intellectual property standards that
the ICOC develops shall include a requirement that each grantee and
the licensees of the grantee submit to the CIRM for approval a plan
that will afford uninsured Californians access to any drug that is,
in whole or in part, the result of research funded by the CIRM, and
would require that the plan shall require that the grantees and
licensees thereof provide drugs to California state and local
government funded programs at one of the three benchmark prices in
the California Discount Prescription Drug Program, except when the
ICOC adopts a waiver, as specified.
   Vote: 70%. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 125293 is added to the Health and Safety Code,
to read:
   125293.  (a) The intellectual property standards that the ICOC
develops shall include a requirement that each grantee and the
licensee of the grantee submit a plan to the California Institute for
Regenerative Medicine (CIRM) that will afford uninsured Californians
access to any drug that is, in whole or in part, the result of
research funded by the CIRM.
   (b) The ICOC shall require submission of the plan required by
subdivision (a) before a drug is placed into commerce within the
United States. The plan shall be subject to the approval of the CIRM,
after a public hearing and opportunity for public comment.
   (c) (1) Any plan permitted pursuant to subdivision (a) shall
require each grantee and any licensee of the grantee that sells drugs
that are, in whole or in part, the result of research funded by CIRM
to provide those drugs to California state and local government
funded programs at one of the three benchmark prices in the
California Discount Prescription Drug Program (Division 112
(commencing with Section 130500)), as it exists on January 1, 2008.
   (2) Paragraph (1) shall not preclude any public agency from
obtaining prices that are lower than the price determined as
described in paragraph (1) through negotiation, bulk purchasing, or
any other purchasing arrangement and shall not be construed to
conflict with, or preempt, any other provision of state or federal
law or regulation that would result in lower drug prices.
   (d) For purposes of this section, "drug" includes any article
recognized in the United States Pharmacopeia or supplement thereof,
the National Formulary, or any supplement thereof, and any article
intended for the diagnosis, cure, mitigation, or prevention of
disease in humans or animals, or any article intended for use as a
component thereof, and shall include therapeutic products, including,
but not limited to, blood, blood products, cells, and cell
therapies.
   (e) Notwithstanding subdivision (c), the ICOC may waive the
requirement that grantees and licensees of the grantee provide drugs
that are, in whole or in part, the result of research funded by CIRM
at one of the three benchmark prices in the California Discount
Prescription Drug Program (Division 112 (commencing with Section
130500)), as it exists on January 1, 2008, only when both of the
following conditions are met:
   (1) Either of the following conditions is met:
   (A) The drug shall be used for the diagnosis, cure, mitigation, or
prevention of a rare disease or condition, as recognized by the
federal Food and Drug Administration under Section 360bb of Title 21
of the United States Code, by individuals who would not otherwise
have access to the drug through private insurance or public programs,
the number of individuals who will have increased access to the drug
represent a significant proportion of the individuals in California
who have that rare disease or condition, and the ICOC has made a
determination that, in the absence of the waiver, development of the
drug will be impeded.
   (B) The grantee commits, in writing, to provide expanded access to
a drug under its access plan to a class of patients who would not
otherwise receive access to the drug, including working uninsured
individuals who do not qualify for any public program or private
health plan or policy that provides coverage of the drug and the ICOC
anticipates that the waiver will provide significant benefits that
equal or exceed the benefits that would otherwise accrue to the state
through the pricing requirements set forth in subdivision (c).
   (2) The ICOC has conducted a public hearing prior to adopting any
waiver pursuant to this subdivision.