Amended in Senate September 6, 2013

Amended in Senate August 19, 2013

Amended in Senate August 12, 2013

Amended in Assembly April 11, 2013

Amended in Assembly March 19, 2013

California Legislature—2013–14 Regular Session

Assembly Bill No. 467

Introduced by Assembly Member Stone

(Principal coauthor: Senator Hill)

February 19, 2013

An act to begin delete amend Section 150201 of, end delete begin insert add Section 4046 to, and to add Article 11.5 (commencing with Section 4169.5) to, Chapter 9 of Division 2 of, the Business and Professions Code, end insert and begin insert to amend Section 150205 of, and end insert to add Section 150208 to, the Health and Safety Code, relating to pharmaceuticals, begin insert making an appropriation therefor, end insert and declaring the urgency thereof, to take effect immediately.

LEGISLATIVE COUNSEL’S DIGEST

AB 467, as amended, Stone. Prescription drugs: collection and distribution program.

Existing law authorizes a county to establish, by ordinance, a repository and distribution program under which specified pharmacies and primary care clinics may distribute surplus unused medications, as defined, to persons in need of financial assistance to ensure access to necessary pharmaceutical therapies. Existing law authorizes specified health and care facilities, pharmacies, drug manufacturers, and pharmacy wholesalers to donate unused medications to the program. Existing law requires a county that has established a program to establish procedures to, among other things, ensure proper safety and management of any medications collected and maintained by a participating entity. begin insert Existing law exempts specified persons and entities, including prescription drug manufacturers and pharmacists and physicians who accept or dispense prescription drugs, from criminal and civil liability for injury caused when donating, accepting, or dispensing prescription drugs in compliance with these provisions. end insert

begin delete

This bill would provide that activities relating to the donation or distribution of medications under the program are not wholesaling activities, and any person, as defined, that is not otherwise a wholesaler shall not be deemed a wholesaler or required to be licensed as a wholesaler when performing those activities.

end delete begin insert

Existing law, the Pharmacy Law, governs the scope and practice of pharmacy, including dispensing dangerous drugs and devices. Existing law establishes in the Department of Consumer Affairs the California State Board of Pharmacy to exercise licensing, regulatory, and disciplinary functions with respect to the practice of pharmacy. Existing law provides that fees collected on behalf of the board are credited to the Pharmacy Board Contingent Fund, a continuously appropriated fund. A violation of the Pharmacy Law is a crime.

end insert begin insert

This bill would require the California State Board of Pharmacy to license a surplus medication collection and distribution intermediary, as defined, established for the purpose of facilitating the connection of eligible and participating entities under the unused medication repository and distribution program described above. Among other things, the bill would prohibit that intermediary from taking possession, custody, or control of dangerous drugs and devices, but would authorize the intermediary to charge specified fees for the reasonable costs of the services provided. The bill would require that a surplus medication collection and distribution intermediary be licensed by the board, as specified, and would require the payment of a fee in the amount of $300 to obtain the license. The bill would provide that the fees collected would be deposited in the Pharmacy Board Contingent Fund. By providing a new source of funds for a continuously appropriated fund, the bill would make an appropriation. Because a violation of the provision governing licensing would be a crime, the bill would impose a state-mandated local program. The bill would exempt a surplus medication collection and distribution intermediary from criminal or civil liability for injury caused when facilitating the donation of prescription drugs.

end insert begin insert

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.

end insert begin insert

This bill would provide that no reimbursement is required by this act for a specified reason.

end insert

This bill would declare that it is to take effect immediately as an urgency statute.

Vote: ²⁄₃. Appropriation:  begin delete no end delete begin insert yes end insert . Fiscal committee:  begin delete no end delete begin insert yes end insert . State-mandated local program:  begin delete no end delete begin insert yes end insert .

The people of the State of California do enact as follows:

begin delete

SECTION 1.  

Section 150201 of the Health and Safety Code
is amended to read:

150201.  

For purposes of this division:

(a) “Eligible entity” means all of the following:

(1) A licensed pharmacy, as defined in subdivision (a) of Section
4037 of the Business and Professions Code, that is county owned
or that contracts with the county pursuant to this division and is
not on probation with the California State Board of Pharmacy.

(2) A licensed pharmacy, as defined in subdivision (a) of Section
4037 of the Business and Professions Code, that is owned and
operated by a primary care clinic, as defined in Section 1204, that
is licensed by the State Department of Public Health and is not on
probation with the California State Board of Pharmacy.

(3) A primary care clinic, as defined in Section 1204, that is
licensed by the State Department of Public Health and licensed to
administer and dispense drugs pursuant to subparagraph (A) of
paragraph (1) of subdivision (a) of Section 4180 of the Business
and Professions Code and is not on probation with the California
State Board of Pharmacy.

(b) “Medication” or “medications” means a dangerous drug, as
defined in Section 4022 of the Business and Professions Code.

(c) “Participating entity” means an eligible entity that has
received written or electronic documentation from the county
health department pursuant to paragraph (3) of subdivision (a) of
Section 150204 and that operates a repository and distribution
program pursuant to this division.

(d) “Person” includes a firm, association, partnership,
corporation, limited liability company, state governmental agency,
or political subdivision.

end delete

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert Section 4046 is added to the end insert begin insert Business and
Professions Code end insert begin insert , to read: end insert

begin insert

begin insert 4046. end insert   

“Surplus medication collection and distribution
intermediary” means a firm, association, partnership, corporation,
limited liability company, state governmental agency or political
subdivision that performs the functions specified in Section 4169.5
for the purpose of a program established pursuant to Division 116
(commencing with Section 150200) of the Health and Safety Code.

end insert

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Article 11.5 (commencing with Section 4169.5) is added
to Chapter 9 of Division 2 of the end insert begin insert Business and Professions Code end insert begin insert ,
to read: end insert

begin insert

 

Article begin insert 11.5. end insert   Surplus Medication Collection and Distribution
Intermediaries

 

begin insert 4169.5. end insert   

(a) A surplus medication collection and distribution
intermediary established for the purpose of facilitating the
connection of eligible and participating entities under a program
established pursuant to Division 116 (commencing with Section
150200) of the Health and Safety Code shall be licensed by the
board. The board shall enforce the requirements set forth in Section
150208 of the Health and Safety Code.

(b) An application for licensure as a surplus medication
collection and distribution intermediary shall be made on a form
furnished by the board, and shall state the name, address, usual
occupation, and professional qualifications, if any, of the applicant.
If the applicant is an entity other than a natural person, the
application shall state the information as to each person
beneficially interested in that entity.

(c) As used in this section, and subject to subdivision (e), the
term “person beneficially interested” means and includes:

(1) If the applicant is a partnership or other unincorporated
association, each partner or member.

(2) If the applicant is a corporation, each of its officers,
directors, and stockholders, provided that no natural person shall
be deemed to be beneficially interested in a nonprofit corporation.

(3) If the applicant is a limited liability company, each officer,
manager, or member.

(d) In any case where the applicant is a charitable organization
described in Section 501 (c) (3) of the Internal Revenue Code, the
applicant shall furnish the board with organizations the articles
of incorporation. The applicant shall also furnish the board with
the names of the controlling members.

(e) In any case where the applicant is a partnership or other
unincorporated association, is a limited liability company, or is
a corporation, and where the number of partners, members, or
stockholders, as the case may be, exceeds five, the application
shall so state, and shall further state the information required by
subdivision (a) as to each of the five partners, members, or
stockholders who own the five largest interests in the applicant’s
entity. Upon request by the executive officer of the board, the
applicant shall furnish the board with the information required
by subdivision (a) as to partners, members, or stockholders not
named in the application, or shall refer the board to an appropriate
source of that information.

(f) The application shall contain a statement to the effect that
the applicant or persons beneficially interested have not been
convicted of a felony and have not violated any of the provisions
of this chapter. If the applicant cannot make this statement, the
application shall contain a statement of the violation, if any, or
reasons which will prevent the applicant from being able to comply
with the requirements with respect to the statement.

(g) Upon the approval of the application by the board and
payment of a fee in the amount of three hundred dollars ($300),
the executive officer of the board shall issue a license to operate
as a surplus medication collection and distribution intermediary,
if all of the provisions of this chapter have been complied with.
Fees received by the board pursuant to this section shall be
deposited into the Pharmacy Board Contingent Fund. An applicant
for licensure as a surplus medication collection and distribution
intermediary that is a nonprofit organization pursuant to
subdivision (d) is exempt from the fee requirement.

(h) A surplus medication collection and distribution
intermediary licensed pursuant to this section is exempt from
licensure as a wholesaler.

end insert

begin insert

begin insert SEC. 3. end insert   

end insert

begin insert Section 150205 of the end insert begin insert Health and Safety Code end insert begin insert is
amended to read: end insert

150205.  

begin insert (a) end insert begin insert   end insert The following persons and entities shall not be
subject to criminal or civil liability for injury caused when
donating, accepting, or dispensing prescription drugs in compliance
with this division:

begin delete

(a)

end delete

begin insert (1) end insert  A prescription drug manufacturer, wholesaler, governmental
entity, or participating entity.

begin delete

(b)

end delete

begin insert (2) end insert  A pharmacist or physician who accepts or dispenses
prescription drugs.

begin delete

(c)

end delete

begin insert (3) end insert  A licensed health or care facility, as described in Section
150202, or a pharmacy, as described in Section 150202.5.

begin insert

(b) A surplus medication collection and distribution
intermediary, as described in Section 150208, shall not be subject
to criminal or civil liability for injury caused when facilitating the
donation of prescription drugs in compliance with this division.

end insert

begin delete SEC. 2. end delete
begin insert SEC. 4. end insert   

Section 150208 is added to the Health and Safety Code,
to read:

begin delete

150208.  

Activities relating to the donation or distribution of
medications, including, but not limited to, facilitating or negotiating
the donation or distribution of medications, pursuant to this division
shall not be deemed wholesaling activities. Any person that is not
otherwise a wholesaler, as defined in Section 4043 of the Business
and Professions Code, shall not be deemed a wholesaler or required
to be licensed as a wholesaler under the Pharmacy Law (Chapter
9 (commencing with Section 4000) of Division 2 of the Business
and Professions Code) when performing those activities pursuant
to this division.

end delete

begin insert

begin insert 150208. end insert   

end insert begin insert

(a) A surplus medication collection and distribution
intermediary that is licensed pursuant to Section 4169.5 of the
Business and Professions Code, established for the purpose of
facilitating the connection of eligible and participating entities
under a program established pursuant to this division is authorized
to operate under this section.

end insert begin insert

(b) A surplus medication collection and distribution
intermediary shall comply with the following:

end insert begin insert

(1) It shall not take possession, custody, or control of dangerous
drugs and devices.

end insert begin insert

(2) It shall ensure that notification is provided to participating
entities that a package has been shipped when the surplus
medication collection and distribution intermediary has knowledge
of the shipment or provided logistical support to facilitate a
shipment directly from an eligible entity to a participating entity.

end insert begin insert

(3) It shall not select, or direct an eligible entity to select, a
specific participating entity to receive surplus medications.

end insert begin insert

(c) A surplus medication collection and distribution intermediary
is authorized to do the following:

end insert begin insert

(1) Contract directly with a county to connect eligible entities
with participating entities and provide general support in a
county’s implementation of a program established pursuant to this
division.

end insert begin insert

(2) Charge membership, administrative, or overhead fees
sufficient to cover the reasonable costs of the services provided.

end insert begin insert

(d) No participating entities shall receive donated medication
directly from the surplus medication collection and distribution
intermediary.

end insert

begin insert

begin insert SEC. 5. end insert   

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.

end insert

begin delete SEC. 3. end delete
begin insert SEC. 6. end insert   

This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:

To ensure that California’s medication donation program is
allowed to continue to operate to facilitate the distribution of
medications to the indigent population which would not otherwise
have access to these medications, it is necessary that this act take
effect immediately.