Amended in Assembly March 17, 2016

California Legislature—2015–16 Regular Session

Assembly Bill No. 2711

Introduced by Assembly Member Chiu

February 19, 2016

An act to begin delete amend end delete begin insert add and repeal end insert Section begin delete 127005 of end delete begin insert 14981 of end insert the begin delete Health and Safety end delete begin insert Government end insert Code, relating to begin delete public health. end delete begin insert pharmaceuticals. end insert

LEGISLATIVE COUNSEL’S DIGEST

AB 2711, as amended, Chiu. begin delete Office of Statewide Health Planning and Development. end delete begin insert Pharmaceuticals: end insert begin insert purchasing end insert begin insert . end insert

begin insert

Existing law authorizes the Department of General Services to enter into contracts on a bid or negotiated basis with manufacturers and suppliers of single source or multisource drugs and authorizes the department to obtain from them discounts, rebates, or refunds as permissible under federal law. Existing law authorizes the department, in consultation with specified state agencies, to investigate and implement other options and strategies to achieve the greatest savings on prescription drugs with prescription drug manufacturers and wholesalers, including, among others, coordinating programs offered by pharmaceutical manufacturers that provide prescription drugs for free or at reduced prices.

end insert begin insert

This bill would require the department, on or before February 1, 2017, to submit a report to the appropriate policy and fiscal committees of the Legislature on activities that have been or will be undertaken pursuant to the above provisions. The bill would require the report to include specified information, such as the number and description of contracts entered into with manufacturers and suppliers of drugs, including any discounts, rebates, or refunds obtained. The bill would repeal the reporting requirement on January 1, 2021. The bill would also state the intent of the Legislature to enact future legislation that enacts strategies to achieve the greatest savings on prescription drugs with prescription drug manufacturers and wholesalers.

end insert begin delete

Existing law establishes the Office of Statewide Health Planning and Development within the California Health and Human Services Agency. Existing law places the office under the control of an executive officer known as the Director of Statewide Health Planning and Development. Existing law provides that the director is appointed by the Governor, subject to confirmation by the Senate, and holds office at the pleasure of the Governor.

end delete begin delete

This bill would make technical, nonsubstantive changes to that provision.

end delete

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

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

begin insert

begin insert SECTION 1. end insert   

end insert

begin insert It is the intent of the Legislature to enact
legislation that would include strategies to achieve the greatest
savings on prescription drugs with prescription drug manufacturers
and wholesalers. end insert

begin insert

begin insert SEC. 2. end insert   

end insert

begin insert Section 14981 is added to the end insert begin insert Government Code end insert begin insert , to
read: end insert

begin insert

begin insert 14981. end insert   

(a) On or before February 1, 2017, the department
shall submit a report to the appropriate policy and fiscal
committees of the Legislature on activities that have been or will
be undertaken pursuant to this chapter. The report shall include,
but not be limited to, all of the following:

(1) The number and a description of contracts entered into with
manufacturers and suppliers of drugs pursuant to Section 14977.1,
including any discounts, rebates, or refunds obtained.

(2) The number and a description of entities that elect to
participate in the coordinated purchasing program pursuant to
Section 14977.5.

(3) Other options and strategies that have been or will be
implemented pursuant to Sections 14978 and 14980.

(4) Estimated costs and savings attributable to activities that
have been or will be undertaken pursuant to this chapter.

(b) (1) The report in subdivision (a) shall be submitted in
compliance with Section 9795.

(2) Pursuant to Section 10231.5, this section is repealed on
January 1, 2021.

end insert

begin delete

SECTION 1.  

Section 127005 of the Health and Safety Code
is amended to read:

127005.  

The office is under the control of an executive officer
known as the Director of Statewide Health Planning and
Development. The director shall be appointed by the Governor,
subject to confirmation by the Senate, and hold office at the
pleasure of the Governor. He or she shall receive the annual salary
provided by Article 1 (commencing with Section 11550) of Chapter
6 of Part 1 of Division 3 of Title 2 of the Government Code.

end delete