BILL ANALYSIS Ó
SB 1193
Page 1
Date of Hearing: August 3, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
SB 1193
(Hill) - As Amended August 1, 2016
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|Policy |Business and Professions |Vote:|13 - 0 |
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Urgency: No State Mandated Local Program: YesReimbursable:
No
SUMMARY:
This bill extends the operation of the Board of Pharmacy (BOP)
until January 1, 2021, and makes various changes to the Pharmacy
Law intended to improve BOP oversight, including the following:
1)Defines and licenses resident and nonresident outsourcing
facilities, and establishes a licensure fee, requires a report
by January 1, 2018 related to BOP's outsourcing facility
regulation, and specifies the report must examine adequacy of
fee revenue for funding oversight activities.
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2)Requires registration of automated drug delivery systems in
pharmacies.
3)Requires the BOP to issue a license within 30 days of
receiving a completed application and payment of any fees.
4)Allows pharmacists to establish a professional corporation.
5)Authorizes the BOP to issue a cease and desist to an entity
practicing activities without a license if those activities
would require licensure by the BOP.
It also extends the operation of the Veterinary Medical Board
(VMB) until January 1, 2021, and makes various minor changes
related to the VMB, including the following:
1)Requires the VMB to provide a separate licensure category for
veterinarians practicing solely within the university setting.
2)Establishes authority for drug compounding in the practice of
veterinary medicine.
FISCAL EFFECT:
BOP provisions (All costs are fee-supported - Pharmacy Board
Contingent Fund):
1)Ongoing costs of $20.1 million per year for the continued
operation of the BOP.
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2)One-time costs of $335,000 and ongoing costs of $320,000 per
year, for licensing and inspection activities relating to
outsourcing facilities. The BOP also estimates $288,000 in
revenue from an outsourcing facilities fee authorized by this
bill in the first year, and $244,000 annually in the second
year. Costs related to other provisions, including
information technology costs, are expected to be minor and
absorbable.
VMB provisions (All costs are fee-supported-Veterinary Medical
Board Contingent Fund):
1)Ongoing costs of about $5.0 million per year for the continued
operation of the VMB. All costs to operate the VMB are funded
with licensing fees.
2)Costs related to VMB-related provisions are anticipated to be
minor and absorbable.
COMMENTS:
1)Purpose. In March 2016, the Senate Business and Professions
Committee and the Assembly Business and Professions Committee
conducted joint oversight hearings to review 11 different
regulatory entities. Sunset review bills, such as this one,
are intended to implement any legislative changes identified
as a result of the hearings and extend regulatory authority
for entities reviewed at the hearings. This bill extends the
sunset for the BOP and the VMB for four years and makes
necessary changes.
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2)Background. The BOP is responsible for enforcing federal and
state laws pertaining to the acquisition, storage,
distribution and dispensing of dangerous drugs (including
controlled substances) and dangerous devices. The BOP has
over 140,000 licensees in 23 license categories that include
both personnel, such as pharmacists, as well as business
licenses, such as pharmacies.
The most substantive change to the BOP statute relates to
outsourcing facilities, generally large-scale production
facilities licensed by federal law to compound large
quantities of medications for use by other entities. In
contrast, compounding pharmacies, which the BOP currently
licenses, may compound a sterile medication pursuant to a
patient-specific prescription or in limited quantities in
anticipation of a patient-specific prescription. The BOP
currently licenses those entities that are federally defined
as outsourcing facilities, as compounding pharmacies. The BOP
indicates licensing compounding pharmacies and outsourcing
facilities separately aligns with federal requirements and is
a more appropriate regulatory approach, due to differences
between the facility types.
The mission of the VMB is to protect consumers and animals
through development and maintenance of professional standards,
licensing of veterinarians, registered veterinary technicians
(RVTs), and premises, and diligent enforcement of the
California Veterinary Medicine Practice Act. The VMB licenses
about 12,000 veterinarians, 6,500 RVTs, and 3,600 veterinary
premises.
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3)Related Legislation. AB 2190 through AB 2194 (Salas) and SB
1192 through 1196 (Hill) are all 2016 sunset review bills on
various topics.
4)Prior Legislation. SB 619 (Morrell) of 2015 would have
established licensure of outsourcing facilities as separate
entities both within and outside California to ship into the
state. This bill was held on the suspense file of the Senate
Appropriations Committee.
Analysis Prepared by:Lisa Murawski / APPR. / (916)
319-2081