BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 1069


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          Date of Hearing:  May 5, 2015


                            ASSEMBLY COMMITTEE ON HEALTH


                                  Rob Bonta, Chair


          AB 1069  
          (Gordon) - As Amended March 26, 2015


          SUBJECT:  Prescription drugs:  collection and distribution  
          program.


          SUMMARY:  Modifies the handling and repackaging requirements for  
          donated pharmaceuticals at voluntary, county-operated  
          prescription drug collection and distribution programs.  


          EXISTING LAW: 


           
          1)Establishes a voluntary, county-operated prescription drug  
            collection and distribution program (Program) to distribute  
            surplus medications to persons in need of financial assistance  
            to ensure access to necessary pharmaceutical therapies.



          2)Requires a county to establish written procedures for its  
            Program including, at a minimum, the following:



             a)   Establishing eligibility for medically indigent patients  








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               who may participate in the Program;

             b)   Ensuring that patients eligible for the program are not  
               charged for any medications provided under the Program;



             c)   Developing a formulary of medications appropriate for  
               the Program;



             d)   Ensuring proper safety and management of any medications  
               collected by and maintained under the authority of a  
               participating entity; and,



             e)   Ensuring the privacy of individuals for whom the  
               medication was originally prescribed.





          3)Establishes a licensure and regulatory framework for a  
            "surplus medication collection and distribution intermediary"  
            (SMCDI) to facilitate the donation of surplus medications in  
            California.

          4)Specifies that only medication that is donated in unopened,  
            tamper-evident packaging or modified unit dose containers that  
            meet specified standards is eligible for donation to the  
            program, provided that lot numbers and expiration dates are  
            affixed; and, prohibits medication donated in opened  
            containers from being dispensed by the program.











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          5)Establishes the California Board of Pharmacy (BOP) to regulate  
            the practice of pharmacy and enforce the pharmacy law.   
            Authorizes the BOP to adopt rules and regulations pertaining  
            to establishments wherein any drug or device is compounded,  
            prepared, furnished, or dispensed. 



          6)Requires, under federal law, all prescription drugs for human  
            use be labeled with specific information including, but not  
            limited to, the recommended or usual dosage, the active  
            ingredients, and an identifying lot or control number from  
            which it is possible to determine the complete manufacturing  
            history of the package of the drug. 



          FISCAL EFFECT:  None.


          COMMENTS:  


          1)PURPOSE OF THIS BILL.  The author states that this bill is  
            necessary to improve current and future Programs by making  
            four necessary operational changes which would allow for the  
            packaging of medications in advance, address the handling of  
            recalls, allow for transfers to non-adjacent counties, and  
            define tamper-evident packaging in state law.  When the  
            Program was initially enacted, it was one of the first in the  
            country and had few examples to draw from.  The Program has  
            been operational for almost five years and has provided enough  
            medications to fill over 30,000 prescriptions.  According to  
            the author, it has become evident that improvements are needed  
            to help streamline the program's operations, encourage  
            additional counties to participate, and help more low-income  
            Californians get the medicine that they need to stay healthy.   
            









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          2)BACKGROUND.  The Program was created by SB 798 (Simitian),  
            Chapter 444, Statutes of 2005, and SB 1329 (Simitian), Chapter  
            709, Statutes of 2012, which authorizes counties to establish  
            a system to facilitate the collection and distribution of  
            surplus unused medications to medically indigent persons.  To  
            date, two counties in California (Santa Clara and San Mateo)  
            have established a Program through local ordinance, although  
            the Santa Clara Program is the only current operational  
            program. 



          Supporting Initiatives to Redistribute Unused Medicine (SIRUM),  
            the sponsor of this bill, is a tax-exempt nonprofit  
            organization that connects safety-net clinics with unexpired,  
            unopened donated drugs from suppliers, pharmacies, and health  
            facilities.  SIRUM works with Santa Clara County through their  
            Program.  SIRUM has reported that over 150 participating  
            health facilities currently donate eligible medication.  An  
            October 2013 California Healthline report stated that, to  
            date, SIRUM had administered the redistribution of 444,380  
            units of medicine worth about $1.5 million wholesale. 
          3)Similar Programs in Other States.  According to the National  
            Conference of State Legislatures, as of January 2015, at least  
            38 states and Guam have enacted laws and programs which are  
            similar to the Program a county may establish under current  
            California law.  While many other state programs exist at the  
            state level or as part of a statewide effort, California is  
            unique in that a Program is established at the county level.   
            Virtually all laws across states include some restrictions  
            designed to assure purity, safety and freshness of the  
            products.  Unless otherwise noted, all programs require:  





             a)   Donated drugs must not be expired and must have a  








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               verified future expiration date;



             b)   Controlled substances defined by the DEA must be  
               excluded;



             c)   A state-licensed pharmacist or pharmacy must be part of  
               the verification and distribution process; and,



             d)   Each patient receiving a drug must have a valid  
               prescription form.


          4)SUPPORT.  SIRUM, sponsor of this bill, states that this bill  
            will increase access to necessary, and in many cases  
            life-sustaining, prescription drugs to medically indigent  
            Californians while at the same time reducing the environmental  
            impact of pharmaceutical waste.  SIRUM states that with  
            shrinking budgets for the healthcare safety net and rising  
            healthcare costs for all Californians, enacting this bill  
            would allow California to maximize quality patient care by  
            reducing the financial burden of pharmaceutical acquisitions  
            and promote environmentally sustainable healthcare practices.   
            The Santa Clara County Board of Supervisors states that  
            improving this program would encourage more counties to  
            consider implementation of a drug collection and distribution  
            program.  


          5)OPPOSITION.  The BOP opposes this bill because it would create  
            conflicts between state and federal law.  Regulation of drug  
            distribution is complex, with a myriad of state and federal  
            laws designed to ensure the safety and efficacy of  
            prescription drugs.  BOP states that they understand the  








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            author's intent to address the needs of indigent patients to  
            secure access to medications; however, this bill in its  
            current form eliminates existing patient protections  
            established in state and federal law and, if improperly done,  
            could harm patients. 


          6)PREVIOUS LEGISLATION.  


             a)   AB 467 (Stone), Chapter 10, Statutes of 2014,  
               establishes a license and regulatory framework for an SMCDI  
               to facilitate the donation of surplus medications in  
               California.


             b)   SB 1329 expands the types of entities that can donate  
               and dispense medication in the Program that provides  
               donated medication to medically indigent patients, and  
               allows counties to establish a program through an action by  
               the county board or through an action of the public health  
               officer of the county. 


             c)   SB 798 establishes a voluntary drug collection and  
               distribution program to allow surplus medications to be  
               shared with persons in need of financial assistance.


          7)POLICY COMMENTS: 


             a)   Repackaging is not appropriate for all drugs.  While the  
               language of this bill intends to make the process of  
               repackaging faster for pharmacists and waiting patients, it  
               fails to address concerns that some classes of drugs should  
               not be repackaged.  Due to their chemical structure, some  
               drugs may degrade when exposed to light or oxygen, and  
               potentially lose efficacy each time they are repackaged.   








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               Moving forward, the author may wish to work with BOP to  
               clarify certain drug classes which should have limited  
               handling and repackaging. 


             b)   There is only one county currently participating.   
               Current law limits transfers of donated drugs to adjacent  
               counties.  This bill would remove that limitation, allowing  
               transfer to any other county-operated pharmacy in the  
               state.  Since there is currently only one county operating  
               a drug collection and redistribution pharmacy, the  
               Committee may wish to consider whether this change is  
               premature. 


          8)SUGGESTED AMENDMENTS. 


             a)   Tamper-evident packaging definition is problematic.  The  
               definition created in this bill would be in conflict with  
               federal law.  That provision of this bill should be  
               stricken. 


             b)   Lot numbers are required under federal law.  Provisions  
               of this bill that would allow participating entities to  
               hold and redistribute medications without lot numbers may  
               be in conflict with federal law.  Lot numbers are  
               necessary, in case of recalls, to be able to track the  
               entire manufacturing history and chain of custody of a  
               medicine.  Provisions of the bill removing the requirements  
               for lot numbers should be stricken. 


             c)   The number of times medicine is repackaged should be  
               limited.  Current law requires pharmacies to repackage  
               donated drugs before distributing to new patients.  The  
               sponsors state that repackaging while the patient waits is  
               unduly time consuming.  However, there are concerns that  








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               the repackaging provisions of this bill are too vague.  The  
               author should amend the bill to limit the number of times  
               medication can be repackaged. 


          REGISTERED SUPPORT / OPPOSITION:




          Support


          Supporting Initiatives to Redistribute Unused Medicine (sponsor)  



          California Association of Health Facilities


          California Chronic Care Coalition (in concept)


          Santa Clara County Board of Supervisors




          Opposition


          California State Board of Pharmacy (unless amended)




          Analysis Prepared by:Dharia McGrew / HEALTH / (916) 319-2097










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