Amended in Senate March 11, 2014

Amended in Senate January 7, 2014

Amended in Senate September 6, 2013

Amended in Senate August 19, 2013

Amended in Senate August 12, 2013

Amended in Assembly April 11, 2013

Amended in Assembly March 19, 2013

California Legislature—2013–14 Regular Session

Assembly Bill No. 467

Introduced by Assembly Member Stone

(Principal coauthor: Senator Hill)

February 19, 2013

An act to add Section 4046 to, and to add Article 11.5 (commencing with Section 4169.5) to Chapter 9 of Division 2 of, the Business and Professions Code, and to amend Sections 150201, 150202, and 150205 of, and to add Section 150208 to, the Health and Safety Code, relating to pharmaceuticals, making an appropriation therefor, and declaring the urgency thereof, to take effect immediately.

LEGISLATIVE COUNSEL’S DIGEST

AB 467, as amended, Stone. Prescription drugs: collection and distribution program.

Existing law authorizes a county to establish, by ordinance, a repository and distribution program under which specified pharmacies and primary care clinics may distribute surplus unused medications, as defined, to persons in need of financial assistance to ensure access to necessary pharmaceutical therapies. Existing law authorizes specified health and care facilities, pharmacies, drug manufacturers, and pharmacy wholesalers to donate unused medications to the program. Existing law requires a county that has established a program to establish procedures to, among other things, ensure proper safety and management of any medications collected and maintained by a participating entity. Existing law exempts specified persons and entities, including prescription drug manufacturers and pharmacists and physicians who accept or dispense prescription drugs, from criminal and civil liability for injury caused when donating, accepting, or dispensing prescription drugs in compliance with these provisions.

Existing law, the Pharmacy Law, governs the scope and practice of pharmacy, including dispensing dangerous drugs and devices. Existing law establishes in the Department of Consumer Affairs the California State Board of Pharmacy to exercise licensing, regulatory, and disciplinary functions with respect to the practice of pharmacy. Existing law provides that fees collected on behalf of the board are credited to the Pharmacy Board Contingent Fund, a continuously appropriated fund. A violation of the Pharmacy Law is a crime.

This bill would require the California State Board of Pharmacy to license a surplus medication collection and distribution intermediary, as defined, established for the purpose of facilitating the donation of medications to or transfer of medications between participating entities under the unused medication repository and distribution program described above. Among other things, the bill would prohibit that intermediary from taking possession, custody, or control of dangerous drugs and devices, but would authorize the intermediary to charge specified fees for the reasonable costs of the support and services provided. The bill would also require a surplus medication collection and distribution intermediary to keep and maintain for 3 years complete records for which the intermediary facilitated the donation of medications to or transfer of medications between participating entities. The bill would require that a surplus medication collection and distribution intermediary begin delete be licensed by the board, as specified, would require that the end delete license be renewed annually, and would require the payment of a fee in the amount of $300 to obtain or renew the license. The bill would provide that the fees collected would be deposited in the Pharmacy Board Contingent Fund. By providing a new source of funds for a continuously appropriated fund, the bill would make an appropriation. Because a violation of the provisions governing licensing and begin delete record-keeping end delete begin insert recordkeeping end insert would be crimes, the bill would impose a state-mandated local program. The bill would exempt a surplus medication collection and distribution intermediary from criminal or civil liability for injury caused when facilitating the donation of medications to or transfer of medications in compliance with these provisions.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

This bill would declare that it is to take effect immediately as an urgency statute.

Vote: ²⁄₃. Appropriation: yes. Fiscal committee: yes. State-mandated local program: yes.

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

SECTION 1.  

Section 4046 is added to the Business and
Professions Code, to read:

4046.  

“Surplus medication collection and distribution
intermediary” means a firm, association, partnership, corporation,
limited liability company, state governmental agency, or political
subdivision that performs the functions specified in Section 4169.5
for the purpose of a program established pursuant to Division 116
(commencing with Section 150200) of the Health and Safety Code.

SEC. 2.  

Article 11.5 (commencing with Section 4169.5) is
added to Chapter 9 of Division 2 of the Business and Professions
Code, to read:

 

Article 11.5.  Surplus Medication Collection and Distribution
Intermediaries

 

4169.5.  

(a) A surplus medication collection and distribution
intermediary established for the purpose of facilitating the donation
of medications to or transfer of medications between participating
entities under a program established pursuant to Division 116
(commencing with Section 150200) of the Health and Safety Code
shall be licensed by the board. The board shall enforce the
requirements set forth in Section 150208 of the Health and Safety
Code. The license shall be renewed annually.

(b) An application for licensure as a surplus medication
collection and distribution intermediary shall be made on a form
furnished by the board, and shall state the name, address, usual
occupation, and professional qualifications, if any, of the applicant.
If the applicant is an entity other than a natural person, the
application shall state the information as to each person beneficially
interested in that entity.

(c) As used in this section, and subject to subdivision (e), the
term “person beneficially interested” means and includes:

(1) If the applicant is a partnership or other unincorporated
association, each partner or member.

(2) If the applicant is a corporation, each of its officers, directors,
and stockholders, provided that no natural person shall be deemed
to be beneficially interested in a nonprofit corporation.

(3) If the applicant is a limited liability company, each officer,
manager, or member.

(d) If the applicant is a charitable organization described in
Section 501(c)(3) of the Internal Revenue Code, the applicant shall
furnish the board with the organization’s articles of incorporation.
The applicant shall also furnish the board with the names of the
controlling members.

(e) If the applicant is a partnership or other unincorporated
association, a limited liability company, or a corporation, and if
the number of partners, members, or stockholders, as the case may
be, exceeds five, the application shall so state, and shall further
state the information required by subdivision begin delete (a) end delete begin insert (b) end insert as to each of
the five partners, members, or stockholders who own the five
largest interests in the applicant’s entity. Upon request by the
executive officer of the board, the applicant shall furnish the board
with the information required by subdivision begin delete (a) end delete begin insert (b) end insert as to partners,
members, or stockholders not named in the application, or shall
refer the board to an appropriate source of that information.

(f) The application shall contain a statement to the effect that
the applicant or persons beneficially interested have not been
convicted of a felony and have not violated any of the provisions
of this chapter. If the applicant cannot make this statement, the
application shall contain a statement of the violation, if any, or
reasons which will prevent the applicant from being able to comply
with the requirements with respect to the statement.

(g) Upon the approval of the application by the board and
payment of a fee in the amount of three hundred dollars ($300),
the executive officer of the board shall issue or renew a license to
operate as a surplus medication collection and distribution
intermediary, if all of the provisions of this chapter have been
complied with. Fees received by the board pursuant to this section
shall be deposited into the Pharmacy Board Contingent Fund. An
applicant for licensure as a surplus medication collection and
distribution intermediary that is government owned or is a nonprofit
organization pursuant to subdivision (d) is exempt from the fee
requirement.

(h) A surplus medication collection and distribution intermediary
licensed pursuant to this section is exempt from licensure as a
wholesaler.

(i) A surplus medication collection and distribution intermediary
licensed pursuant to this section shall keep and maintain for three
years complete records for which the intermediary facilitated the
donation of medications to or transfer of medications between
participating entities.

SEC. 3.  

Section 150201 of the Health and Safety Code is
amended to read:

150201.  

For purposes of this division:

(a) “Donor organization” means an entity described in
subdivision (a) of Section 150202.

(b) “Eligible entity” means all of the following:

(1) A licensed pharmacy, as defined in subdivision (a) of Section
4037 of the Business and Professions Code, that is county owned
or that contracts with the county pursuant to this division and is
not on probation with the California State Board of Pharmacy.

(2) A licensed pharmacy, as defined in subdivision (a) of Section
4037 of the Business and Professions Code, that is owned and
operated by a primary care clinic, as defined in Section 1204, that
is licensed by the State Department of Public Health and is not on
probation with the California State Board of Pharmacy.

(3) A primary care clinic, as defined in Section 1204, that is
licensed by the State Department of Public Health and licensed to
administer and dispense drugs pursuant to subparagraph (A) of
paragraph (1) of subdivision (a) of Section 4180 of the Business
and Professions Code and is not on probation with the California
State Board of Pharmacy.

(c) “Medication” or “medications” means a dangerous drug, as
defined in Section 4022 of the Business and Professions Code.

(d) “Participating entity” means an eligible entity that has
received written or electronic documentation from the county
health department pursuant to paragraph (3) of subdivision (a) of
Section 150204 and that operates a repository and distribution
program pursuant to this division.

SEC. 4.  

Section 150202 of the Health and Safety Code is
amended to read:

150202.  

(a) Notwithstanding any other law, a donor
organization is defined, for purposes of this division, to refer to
one of the following health and care facilities that may donate
centrally stored unused medications under a program established
pursuant to this division:

(1) A licensed general acute care hospital, as defined in Section
1250.

(2) A licensed acute psychiatric hospital, as defined in Section
1250.

(3) A licensed skilled nursing facility, as defined in Section
1250, including a skilled nursing facility designated as an
institution for mental disease.

(4) A licensed intermediate care facility, as defined in Section
1250.

(5) A licensed intermediate care facility/developmentally
disabled-habilitative facility, as defined in Section 1250.

(6) A licensed intermediate care facility/developmentally
disabled-nursing facility, as defined in Section 1250.

(7) A licensed correctional treatment center, as defined in
Section 1250.

(8) A licensed psychiatric health facility, as defined in Section
1250.2.

(9) A licensed chemical dependency recovery hospital, as
defined in Section 1250.3.

(10) A licensed residential care facility for the elderly, as defined
in Section 1569.2, with 16 or more residents.

(11) An approved mental health rehabilitation center, as
described in Section 5675 of the Welfare and Institutions Code.

(b) Medication donated by health and care facilities pursuant
to subdivision (a) shall meet the requirements of subdivisions (c)
and (d) of Section 150204 and shall be unexpired medication that
would have otherwise been destroyed by the facility or another
appropriate entity.

(c) Medication eligible for donation by the health and care
facilities pursuant to subdivision (a) shall be directly delivered
from the dispensing pharmacy, wholesaler or manufacturer, to the
health or care facility and subsequently centrally stored. Centrally
stored medication that originated from a patient or resident is not
eligible for donation under this division.

SEC. 5.  

Section 150205 of the Health and Safety Code is
amended to read:

150205.  

(a) The following persons and entities shall not be
subject to criminal or civil liability for injury caused when
donating, accepting, or dispensing prescription drugs in compliance
with this division:

(1) A prescription drug manufacturer, wholesaler, governmental
entity, or participating entity.

(2) A pharmacist or physician who accepts or dispenses
prescription drugs.

(3) A licensed health or care facility, as described in Section
150202, or a pharmacy, as described in Section 150202.5.

(b) A surplus medication collection and distribution
intermediary, as described in Section 150208, shall not be subject
to criminal or civil liability for injury caused when facilitating the
donation of medications to or transfer of medications in compliance
with this division.

SEC. 6.  

Section 150208 is added to the Health and Safety Code,
to read:

150208.  

(a) A surplus medication collection and distribution
intermediary that is licensed pursuant to Section 4169.5 of the
Business and Professions Code, established for the purpose of
facilitating the donation of medications to or transfer of
medications between participating entities under a program
established pursuant to this division is authorized to operate under
this section.

(b) A surplus medication collection and distribution intermediary
shall comply with the following:

(1) It shall not take possession, custody, or control of dangerous
drugs and devices.

(2) It shall ensure that notification is provided to participating
entities that a package has been shipped when the surplus
medication collection and distribution intermediary has knowledge
of the shipment and provided logistical support to facilitate a
shipment directly from a donor organization, as defined in
subdivision (a) of Section 150202, to a participating entity.

(3) It shall not select, or direct a donor organization, as defined
in subdivision (a) of Section 150202, to select, a specific
participating entity to receive surplus medications.

(c) A surplus medication collection and distribution intermediary
is authorized to do the following:

(1) Charge membership, administrative, or overhead fees
sufficient to cover the reasonable costs of the support and services
provided.

(2) Contract directly with a county to facilitate the donation of
medications to or transfer of medications between participating
entities and provide general support in a county’s implementation
of a program established pursuant to this division.

(d) No participating entities shall receive donated medication
directly from the surplus medication collection and distribution
intermediary.

SEC. 7.  

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of
the Government Code, or changes the definition of a crime within
the meaning of Section 6 of Article XIII B of the California
Constitution.

SEC. 8.  

This act is an urgency statute necessary for the
immediate preservation of the public peace, health, or safety within
the meaning of Article IV of the Constitution and shall go into
immediate effect. The facts constituting the necessity are:

To ensure that California’s medication donation program is
allowed to continue to operate to facilitate the distribution of
medications to the indigent population which would not otherwise
have access to these medications, it is necessary that this act take
effect immediately.