BILL ANALYSIS                                                                                                                                                                                                    

                                                                     AB 623

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          Date of Hearing:  May 27, 2015


                                 Jimmy Gomez, Chair

          623 (Wood) - As Amended May 4, 2015

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          |             |Business and Professions       |     |13 - 1       |
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          Urgency:  No  State Mandated Local Program:  YesReimbursable:   


          This bill addresses issues related to abuse of opioid analgesic  
          drugs.  Specifically, this bill:


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          1)Requires pharmacists to inform patients receiving an opioid  
            analgesic drug product on proper storage and disposal of the  

          2)Restricts the ability of health plans and insurers to limit  
            access to abuse-deterrent forms of opioid analgesic drugs.

          3)Requires a health plan or insurer to allow a provider to  
            prescribe, and if otherwise covered, to provide coverage for,  
            a less than 30-day supply of an opioid analgesic drug product.

          FISCAL EFFECT:

          1)According to the California Health Benefits Review Program  
             a)   $4.4 million to Medi-Cal (GF/federal) and $135,000 to  
               CalPERS for increased premiums. 

             b)   Increased employer-funded premium costs in the private  
               insurance market of approximately $1.2 million.

             c)   Increased premium expenditures by employees and  
               individuals purchasing insurance of $1.6 million, and  
               increased out-of-pocket expenses of $450,000.   

          2)Costs to the Board of Pharmacy to adopt regulations in the  
            range of $50,000 (Pharmacy Board Contingent Fund).

          3)Minor costs to the California Department of Insurance and the  
            Department of Managed Health Care to verify plans and insurers  


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            comply with this requirement.


          1)Purpose. The purpose of this bill is to address some aspects  
            of opioid addiction. According to the author, given the  
            availability of abuse-deterrent opioids, health care providers  
            should be allowed to exercise their judgment in prescribing  
            them without worrying about cost-related hurdles.   
            Additionally, better education on storage and disposal would  
            reduce the supply of opioids available for abuse.  

          2)Background. According to the federal Food and Drug  
            Administration (FDA), opioid drugs provide significant benefit  
            for patients when used properly for pain relief; however,  
            opioids also carry a risk of misuse, abuse and death.  Opioid  
            products can be abused in a number of ways, including being  
            swallowed whole; crushed in order to be swallowed, snorted,  
            smoked; and, dissolved and injected.  Abuse-deterrent drugs  
            work correctly when taken as prescribed, but may be formulated  
            in such a way that deters misuse and abuse, including making  
            it difficult to snort or inject the drug for a more intense  

            The FDA released industry guidance on April 1, 2015 regarding  
            the evaluation and labeling of abuse-deterrent opioids, citing  
            the development of abuse-deterrent opioids as a potentially  
            important step toward the goal of creating safer opioid  
            analgesics.  The FDA also noted that abuse-deterrent  
            technologies developed to date have not yet proven successful  
            at deterring the most common form of abuse - swallowing a  
            number of intact capsules or tables to achieve a feeling of  
            euphoria.  Further, the FDA stated that the science of abuse  
            deterrence is relatively new, and both the formulation  
            technologies and the analytical, clinical, and statistical  


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            methods for evaluating the technologies are rapidly evolving.

          3)CHBRP Analysis.  Overall, CHBRP finds, based on a review of  
            the medical literature, that the impact of abuse-deterrent  
            opioids on abuse is ambiguous.  Some studies find they reduce  
            some forms of abuse, but other studies suggest they shift  
            abuse to other drugs.  CHBRP found the unit cost for opioid  
            prescriptions would increase by 13% by increasing utilization  
            of abuse-deterrent formulations by 38%, but that this bill is  
            unlikely to have a material impact on public health.  CHBRP  
            states it would not affect affect the number of opioid  
            analgesic overdoses, hospitalizations, and deaths for a number  
            of reasons, including the fact that the most common form of  
            abuse (swallowing pills) is not deterred by abuse-deterrent  
            formulations and the potential for persons addicted to opioids  
            to turn to heroin instead, or to simply swallow the pills  
            instead of crushing or injecting them.  CHBRP concludes  
            further study is needed in order to ascertain effectiveness in  
            preventing abuse.

          4)Legislation in other states.  At least 15 other bills  
            expanding coverage and access to abuse-deterrent opioids have  
            been introduced this year in other states.

          5)Support. This bill is sponsored by Power of Pain Foundation  
            and the U.S. Pain Foundation.  It is supported by  
            biotechnology industry groups, patient advocacy groups,  
            pharmacists, law enforcement, and Partnership for Drug Free  
            Kids.  Supporters state that misuse and abuse of opioids is a  
            growing public health problem, and abuse-deterrent opioids  
            represent a significant opportunity to reduce misuse and  


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          6)Opposition. Health plans and insurers, as well as pharmacy  
            benefit managers, oppose this bill.  The California  
            Association of Health Plans (CAHP) writes that abuse-deterrent  
            drugs are fairly new, costly, and have insufficient evidence  
            about their efficacy in deterrence.  The Pharmaceutical Care  
            Management Association, a national association of pharmacy  
            benefit managers states that this bill is part of a nationwide  
            effort to force the use of abuse-deterrent opioids by  
            disallowing generic substitutions, but abuse-deterrent  
            formulations are not a quick fix for opioid abuse and will  
            raise costs.  Express Scripts, a pharmacy benefit manager,  
            estimates that abuse-deterrent opioids cost about three times  
            as much as non-abuse-deterrent agents.

          Analysis Prepared by:Lisa Murawski / APPR. / (916)