BILL ANALYSIS Ó
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THIRD READING
Bill No: AB 377
Author: Solorio (D)
Amended: 8/24/12 in Senate
Vote: 21
SENATE BUSINESS, PROF. & ECON. DEV. COMM. : 9-0, 6/13/11
AYES: Price, Emmerson, Corbett, Correa, Hernandez, Negrete
McLeod, Vargas, Walters, Wyland
SENATE APPROPRIATIONS COMMITTEE : 6-0, 8/13/12
AYES: Kehoe, Walters, Alquist, Lieu, Price, Steinberg
NO VOTE RECORDED: Dutton
ASSEMBLY FLOOR : 70-0, 5/12/11 (Consent) - See last page
for vote
SUBJECT : Pharmacy
SOURCE : California Hospital Association
DIGEST : This bill authorizes a centralized hospital
packaging pharmacy to prepare medications, by performing
specified functions for administration only to inpatients
within its own general acute care hospital, or one or more
general acute care hospitals under the same ownership and
located within 75 miles of each other.
Senate Floor Amendments of 8/24/12 correct a typographical
error by striking the work "lot" to instead, refer to "The
National Drug Code Directory number."
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ANALYSIS :
Existing law:
1. Provides for the practice of pharmacy and the licensing
and regulation of pharmacies and pharmacists by the
Board of Pharmacy (Board) within the Department of
Consumer Affairs.
2. Defines "hospital pharmacy" as a pharmacy licensed by
the Board, located within any licensed hospital,
institution or establishment that maintains and operates
organized facilities for the diagnosis, care, and
treatment of human illnesses to which persons may be
admitted for overnight stay.
3. Provides that "hospital pharmacy" also includes a
pharmacy that may be located outside of the hospital, in
another physical plant that is regulated under a
hospital's consolidated license issued by the Department
of Corrections and Rehabilitations or Department of
Youth Authority. Specifies that the pharmacy in another
physical plant shall provide pharmaceutical services
only to registered hospital patients who are on the
premises of the same physical plant in which the
hospital is located. Specifies that the pharmacy
services provided shall be directly related to the
services or treatment plan administered in the physical
plant.
4. State that any pharmacy that contracts to compound a
drug for parenteral therapy, pursuant to a prescription,
for delivery to another pharmacy, must report that
contractual arrangement to the Board within 30 days of
commencing that compounding.
This bill:
1. This bill allows a centralized hospital packaging
pharmacy to prepare medications for administration only
to inpatients within its own general acute care hospital
and one or more general acute care hospitals if the
hospitals are under common ownership and located within
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a 75-mile radius of each other.
2. Authorizes a centralized hospital to perform the
following specialized functions if each unit dose is
barcoded as specified:
A. Preparing unit dose packages for single
administration to inpatients from bulk containers.
B. Preparing compounded unit dose drugs for
parenteral therapy for administration to
inpatients.
C. Preparing compounded unit dose drugs for
administration to inpatients.
3. Defines "common ownership" to mean that the ownership
information on file with the Board for the licensed
pharmacy is consistent with the ownership information on
file for the other licensed pharmacy or pharmacies.
4. Requires, in addition to pharmacy license requirement
described in current law, a centralized hospital
packaging pharmacy to obtain a specialty license from
the Board prior to engaging in the functions authorized
by this bill.
5. Requires the Board, before issuing and renewing the
specialty license, to inspect the pharmacy and ensure
that the pharmacy is in compliance with this bill and
regulations it has established.
6. States a license to perform the functions described in
this bill shall only be issued to a pharmacy that is
licensed by the Board as a hospital pharmacy, and that
the license shall be renewed annually and is not
transferrable.
7. Sets the fee for issuance or annual renewal of a
centralized hospital packaging pharmacy license at $600
and allows it to be increased by the Board to $800.
8. Allows a centralized hospital packaging pharmacy to
prepare and store a limited quantity of the unit dose
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drugs in advance of receipt of a patient-specific
prescription in a quantity as is necessary to ensure
continuity of care for an identified population of
inpatients of the general acute care hospital based on a
documented history of prescriptions for that patient
population.
9. Requires any unit dose medication produced by a
centralized hospital packaging pharmacy to be barcoded
to be readable at the inpatient's bedside. Upon reading
the barcode, the following information shall be
retrievable:
A. The date the medication was prepared.
B. The components used in the drug product.
C. The lot number or control number.
D. The expiration date.
E. The National Drug Code Directory number.
F. The name of the centralized hospital packaging
pharmacy.
10.Requires the label for each unit dose medication
produced by a centralized hospital packaging pharmacy to
contain all of the following:
A. The expiration date.
B. The established name of the drug.
C. The quantity of the active ingredient.
D. Special storage or handling requirements.
11.Requires all compounding and packaging functions be
performed only in the licensed centralized hospital
packaging pharmacy and that pharmacy shall comply with
all applicable federal and state statutes and
regulations, including, but not limited to, regulations
regarding compounding and, when appropriate, sterile
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injectable compounding.
12.Requires a centralized hospital packaging pharmacy and
the pharmacists working in the pharmacy be responsible
for the integrity, potency, quality, and labeled
strength of any unit dose drug product prepared by the
centralized hospital packaging pharmacy.
Background
Existing law requires medications for a hospital's patients
to be prepared by a licensed pharmacy located on the
hospital's premises. Automated processes implemented by a
hospital or health system have the potential to provide
additional patient protection through a reduction in
medication errors. Many medication errors in hospitals
have resulted from inadequate and inconsistent labeling and
a lack of proper mechanisms to track medication through the
distribution process to the patient. Recent reports show
that technology like bar-coding facilitates more efficient
medication administration and decreases medication errors.
According to a study published in the New England Journal
of Medicine, "Effect of Bar-Code Technology on the Safety
of Medication Administration," use of the bar-code
substantially decreased the rate of errors as well as
potential adverse drug events. The report also concluded
that the bar-code electronic medication administration is
an important intervention to improve patient safety.
Food and Drug Administration (FDA). Repackaging,
distribution, and compounding in advance of a patient
prescription are activities currently available only to
licensed manufacturers, which are regulated by the United
States FDA. Last year, in an email pertaining to a
Virginia hospital using a model as proposed in this bill,
which is virtually identical to AB 2077 (Soloria, 2010),
the FDA stated that "Ýthe proposed health facility
pharmacy] system does not need to register as a
repacker/relabeler as long as they are servicing their own
hospitals within the state of California and repackaged
drugs are not commercially distributed and used only within
your hospital facilities." While there has not been an
official change in FDA policy, it is clear in the FDA's
Compliance Policy Guide (460.200) as follows: "FDA will
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continue to defer to state authorities regarding pharmacy
compounding of human drugs."
Board Compounding Regulations . New regulations governing
compounding took effect last summer. According to the
Board, a Workgroup on Compounding was formed in 2004
comprised of board members, Board staff and industry
representatives. The workgroup recognized that current
pharmacy regulations addressing compounding only govern the
physical circumstances, procedures and record keeping
requirements for general compounding and do not address
quality, strength or purity.
The Board adopted regulations in Article 7 of Division 17
of Title 16 of the California Code of Regulations
(commencing with Section 1751) to implement provisions for
pharmacies that compound sterile injectable products as
required in statute. As there were no similar provisions
in regulation for general compounding, the Board approved
the addition of language that will establish parameters and
provide uniformity for pharmacies that carry out
compounding in general (including sterile injectable).
Pharmacies that compound sterile injectable products must
go above and beyond the requirements for compounding in
general.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee, minor
costs annually to the Board from the Pharmacy Board
Contingent Fund, offset by fees. Potentially major costs
annually to the Department of Public Health from the
Licensing and Certification Program Fund.
SUPPORT : (Verified 8/14/12)
California Hospital Association (source)
AmerisourceBergen
Board of Pharmacy
California Pharmacists Association
California Society of Health-System Pharmacists
Los Angeles County
Mercy
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Sharp
University of California, San Francisco School of Pharmacy
ASSEMBLY FLOOR :
AYES: Achadjian, Allen, Ammiano, Atkins, Beall, Bill
Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Chesbro, Cook, Davis, Dickinson, Donnelly, Eng,
Feuer, Fletcher, Fong, Fuentes, Furutani, Beth Gaines,
Galgiani, Gatto, Gordon, Grove, Hagman, Halderman, Hall,
Harkey, Hayashi, Hill, Huber, Hueso, Huffman, Jeffries,
Jones, Knight, Lara, Logue, Ma, Mansoor, Mendoza, Miller,
Monning, Morrell, Nestande, Nielsen, Norby, Olsen, Pan,
Perea, V. Manuel Pérez, Silva, Skinner, Smyth, Solorio,
Swanson, Valadao, Wagner, Wieckowski, Williams, Yamada,
John A. Pérez
NO VOTE RECORDED: Alejo, Cedillo, Conway, Garrick, Gorell,
Roger Hernández, Bonnie Lowenthal, Mitchell, Portantino,
Torres
JJA:d 8/27/12 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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