BILL ANALYSIS                                                                                                                                                                                                    Ó



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

          SB 1193 (Hill) - Pharmacy:  outsourcing facilities
          
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          |Version: April 13, 2016         |Policy Vote: B., P. & E.D. 9 -  |
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          |Urgency: No                     |Mandate: Yes                    |
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          |Hearing Date: May 2, 2016       |Consultant: Brendan McCarthy    |
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          This bill meets the criteria for referral to the Suspense File.

          Bill  
          Summary:  SB 1193 would extend the statutory sunset on the Board  
          of Pharmacy to January 1, 2021. The bill would also make several  
          changes to the authority and practice of the Board.


          Fiscal  
          Impact:  
           Ongoing costs of $20 million per year for the continued  
            operation of the Board of Pharmacy (Pharmacy Board Contingent  
            Fund). The Board's operations are fully supported by licensing  
            fees.

           One-time costs of $335,000 and ongoing costs of $320,000 per  
            year for licensing and inspection activities relating to  
            outsourcing facilities (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  







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          out-of-state pharmacies that sell prescription drugs in the  
          state to be licensed by the Board. The Board has a statutory  
          sunset of January 1, 2017.
          Federal law has created a new category of pharmacy 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.) Current California law does not have a  
          license category specific to outsourcing facilities.




          Proposed Law:  
            SB 1193 would extend the statutory sunset on the Board of  
          Pharmacy to January 1, 2021. 
          Specific provisions of the bill would:
                 Extend the operation of the Board and the authority to  
               employ an executive officer to January 1, 2021;
                 Require outsourcing facilities to be licensed by the  
               Board (whether or not they are located in California) and  
               impose specified regulatory requirements on outsourcing  
               facilities;
                 Establish a $780 licensing fee for outsourcing  
               facilities;
                 Require a pharmacy using an automated drug delivery  
               system to register its use with the Board;
                 Require the Board to issue a license to a clinic (or  
               incorporate any changes to a license) within 30 days;
                 Authorize the Board to issue a cease and desist letter  
               to an entity practicing activities without a license that  
               require licensure;
                 Authorize pharmacists to establish professional  
               corporations.


          Related  
          Legislation:  SB 619 (Morrell) would have required outsourcing  
          facilities to be licensed by the Board of Pharmacy. That bill  
          was held on this committee's Suspense File.


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