BILL ANALYSIS                                                                                                                                                                                                    Ó



          SENATE COMMITTEE ON APPROPRIATIONS
                             Senator Ricardo Lara, Chair
                            2015 - 2016  Regular  Session

          SB 619 (Morrell) - Pharmacy:  outsourcing facilities:  licensure
          
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          |Version: April 6, 2015          |Policy Vote: B., P. & E.D. 8 -  |
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          |Urgency: No                     |Mandate: No                     |
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          |Hearing Date: May 11, 2015      |Consultant: Brendan McCarthy    |
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          This bill meets the criteria for referral to the Suspense File.



          


          Bill  
          Summary:  SB 619 would require outsourcing facilities to be  
          licensed by the Board of Pharmacy.


          Fiscal  
          Impact:  One-time costs of $177,000 for licensing and inspection  
          activities and computer system upgrades and ongoing costs of  
          $126,000 per year for licensing and inspections (Pharmacy Board  
          Contingent Fund).


          Background:  Under current law, the Board of Pharmacy licenses pharmacists  
          as well as pharmacies, compounding pharmacies, wholesalers,  
          dispensaries, and related facilities. Current law requires  
          out-of-state pharmacies that sell prescription drugs in the  







          SB 619 (Morrell)                                       Page 1 of  
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          state to be licensed by the Board.
          Federal law has created a new category relating to prescription  
          drugs known as outsourcing facilities. Outsourcing facilities  
          are sterile facilities that compound prescription drugs in large  
          quantities, not for individual patients. (In contrast to  
          compounding pharmacies, which compound drugs to fill specific  
          prescriptions.)




          Proposed Law:  
            SB 619 would require outsourcing facilities to be licensed by  
          the Board of Pharmacy.
          Specific provisions of the bill would:
              Require an outsourcing facility to be licensed by the Board  
              of Pharmacy if it compounds medication, without a  
              patient-specific prescription, for patients or practitioners  
              inside or outside California;
              Specify the activities that an outsourcing facility can and  
              cannot perform;
              Apply the licensing requirement to out-of-state outsourcing  
              facilities that ship compounded prescription drugs into the  
              state;
              Require the Board to report to the Legislature by January  
              1, 2018 on its licensing and regulatory efforts;
              Authorize the Board to issue a cease and desist order to an  
              outsourcing facility if the Board determines that there is  
              an immediate threat to public health;
              Specify the fees for issuance or renewal of a license for  
              an outsourcing facility, including a requirement that an  
              out-of-state outsourcing facility must also provide  
              reasonable funding to cover the costs for out-of-state  
              inspections.

          Related Legislation:



            

              SB 600 (Lieu, Statutes of 2014) made changes to state law  
              to conform to changes to federal law in the area of  
              pharmacy.








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              AB 2605 (Bonilla, Statutes of 2014) requires third party  
              logistics providers to be licensed by the Board of Pharmacy.
              SB 294 (Emmerson, Statutes of 2013) requires an inspection  
              by the Board of Pharmacy before licensing compounding  
              pharmacies, including out-of-state facilities.


          Staff  
          Comments:  As noted above, recent federal law created a new  
          category of facility relating to the distribution of  
          prescription drugs. This bill requires licensure by outsourcing  
          facilities by the Board of Pharmacy with requirements similar to  
          those imposed on compounding pharmacies.


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