BILL ANALYSIS �
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|SENATE RULES COMMITTEE | AB 467|
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THIRD READING
Bill No: AB 467
Author: Stone (D), et al.
Amended: 1/7/14 in Senate
Vote: 27 - Urgency
PRIOR VOTES NOT RELEVANT
SENATE BUSINESS, PROF. & ECON. DEV. COMM. : 9-0, 1/13/14
AYES: Lieu, Block, Corbett, Galgiani, Hernandez, Hill, Padilla,
Wyland, Yee
NO VOTE RECORDED: Vacancy
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SUBJECT : Prescription drugs: collection and distribution
program
SOURCE : Author
DIGEST : This bill establishes a licensure category for 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 a county's unused medication
repository and distribution program.
ANALYSIS :
Existing law, the Business and Professions Code:
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1. Establishes the practice of pharmacy and provides for the
licensing and regulation of pharmacies and pharmacists by the
Board of Pharmacy (Board) within the Department of Consumer
Affairs (DCA).
2. Defines "dangerous drug" or "dangerous device" as any drug
or device unsafe for self-use in humans or animals.
3. Defines "wholesaler" as a person who acts as a wholesale
merchant, broker, jobber, customs broker, reverse
distributor, agent, or a nonresident wholesaler, who sells
for resale, or negotiates for distribution, or takes
possession of, any drug or device. Provides that unless
otherwise authorized by law, a wholesaler may not store,
warehouse, or authorize the storage or warehousing of drugs
with any person or at any location not licensed by the Board.
4. Specifies certain requirements regarding the dispensing and
furnishing of dangerous drugs and devices, and prohibits a
person from furnishing any dangerous drug or device except
upon the prescription of a physician, dentist, podiatrist,
optometrist, veterinarian or naturopathic doctor, as
specified.
5. Provides that no person shall act as a wholesaler of any
dangerous drug or dangerous device unless he/she has obtained
a license from the Board. Requires a separate license for
each place of business owned or operated by a wholesaler.
6. Prohibits a person or entity from:
A. Purchasing, trading, selling, or transferring
dangerous drugs or dangerous devices at wholesale with a
person or entity that is not licensed with the Board as a
wholesaler or pharmacy.
B. Purchasing, trading, selling, or transferring
dangerous drugs that the person knew or reasonably should
have known were adulterated or misbranded.
C. Purchasing, trading, selling, or transferring
dangerous drugs or dangerous devices after the beyond use
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date on the label.
7. Requires records of the acquisition or disposition of
dangerous drugs or dangerous devices to be maintained for at
least three years.
8. Authorizes a primary care clinic to purchase drugs at
wholesale for the administration and dispensing under the
direction of a physician and surgeon to patients registered
at the clinic.
Existing law, the Health and Safety Code (HSC):
1. Establishes a voluntary drug repository and distribution
program (Program) for the purpose of distributing surplus
medications to persons in need of financial assistance to
ensure access to necessary pharmaceutical therapies.
2. Defines the following terms:
A. "Eligible entity" means a licensed pharmacy that is
county owned or that contracts with the county pursuant to
HSC Division 116 and is not on probation with the Board, a
licensed pharmacy that is owned and operated by a primary
care clinic that is licensed by the Department of Public
Health (DPH) and is not on probation with the Board, a
primary care clinic that is licensed by DPH and licensed
to administer and dispense drugs and is not on probation
with Board.
B. "Medication" or "medications" means a dangerous drug,
as defined in Business and Professions Code Section 4022.
C. "Participating entity" means an eligible entity that
has received written or electronic documentation from the
county health department and that operates a Program.
3. Authorizes a county to establish a Program, by an action of
the county board of supervisors or by an action of the public
health officer of the county, as directed by the county board
of supervisors; and requires the county to notify the Board
within 30 days from the date it establishes a Program.
4. Provides that a participating entity shall disclose to the
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county health department on a quarterly basis the name and
location of the source of all donated medication it receives;
and provides that a participating primary care clinic shall
disclose to the county health department the name of the
licensed physician who shall be accountable to the Board for
the clinic's Program operations.
5. Specifies requirements to medication donated to the Program,
including, but not limited to that (a) the medication shall
not be a controlled substance; (b) a pharmacist or physician
at a participating entity shall use his/her professional
judgment in determining whether donated medication meets
certain standards before accepting or dispensing any
medication under the Program; (c) medication that is donated
to the Program shall either be dispensed to an eligible
patient, destroyed, returned to a reverse distributor or
licensed waste hauler or transferred to another participating
entity within the county to be dispensed to eligible
patients.
6. Provides that a prescription drug manufacturer, wholesaler,
governmental entity, participating entity, pharmacist or
physician who accepts or dispenses prescription drugs and a
licensed health or care facility or a pharmacy are not
subject to criminal or civil liability for injury caused when
donating, accepting or dispensing prescription drugs under a
Program.
This bill:
1. Establishes a licensure category under the authority of the
Board for a "surplus medication collection and distribution
intermediary" (Intermediary) operating for the purpose of
facilitating the donation of medications to, or transfer of
medications between, participating entities under a county's
Program.
2. Requires an Intermediary to provide the Board information on
a form as part of its application for licensure, including
the name, address, usual occupation, and professional
qualifications, if any, of the applicant; provides that 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; and provides that the
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Intermediary license shall be renewed annually.
3. Provides that in any case where the Intermediary licensure
applicant is a charitable organization described in Internal
Revenue Code Section 501 (c) (3), the applicant shall furnish
the Board with the organization's Articles of Incorporation
and the names of the controlling members.
4. Establishes an Intermediary licensure and renewal fee of
$300; and exempts an Intermediary that is government owned or
a nonprofit organization from the fee requirement.
5. Exempts an Intermediary licensee from licensure as a
wholesaler.
6. Requires an Intermediary to keep and maintain, for three
years, complete records for which it facilitated the donation
of medications to, or transfer of medications between,
participating entities under the Program.
7. Defines "donor organization" as any of the following health
and care facilities that may donate centrally stored unused
medications under the Program:
A licensed general acute care hospital.
A licensed acute psychiatric hospital.
A licensed skilled nursing facility, including a
skilled nursing facility designated as an institution for
mental disease.
A licensed intermediate care facility.
A licensed intermediate care facility/developmentally
disabled-rehabilitative facility.
A licensed intermediate care facility/developmentally
disabled-nursing facility.
A licensed correctional treatment center.
A licensed psychiatric health facility.
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A licensed chemical dependency recovery hospital.
A licensed residential care facility for the elderly
with 16 or more residents.
An approved mental health rehabilitation center.
1. Adds an Intermediary to the list of existing persons and
entities persons which shall not be subject to criminal or
civil liability for injury caused when donating, accepting,
or dispensing prescription drugs in compliance with the
Program.
2. Prohibits an Intermediary from taking possession, custody,
or control of dangerous drugs and devices.
3. Requires an Intermediary to 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.
4. Prohibits an Intermediary from directing a donor
organization to select a specific participating entity to
receive surplus medications.
5. Authorizes an Intermediary to charge membership,
administrative, or overhead fees sufficient to cover the
reasonable costs of the support and services provided in
facilitating the donation of medications to, or transfer of
medications between, participating entities.
6. Authorizes an Intermediary to contract directly with a
county to facilitate the donation of medications to, or
transfer of medications between, participating entities and
provide general support in the Program.
Background
California's Efforts to Donate Unused Medication
SB 798 (Simitian, Chapter 444, Statutes of 2005) authorized
California counties to establish a "surplus prescription drug
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collection and distribution program" (Program) for the
distribution of unused, unexpired medication to medically
indigent patients. Under the Program, counties could adopt an
ordinance to establish such a Program, under which skilled
nursing facilities (SNFs), and SNFs that are institutions for
mental disease, drug wholesalers, and drug manufacturers could
donate unused medications to county-owned pharmacies, or
pharmacies that contract with the county for dispensing to
medically indigent patients free of charge. Prior to the
enactment of SB 798, SNFs were required to either destroy the
drugs in the presence of a pharmacist or nurse, or return the
drugs to the issuing pharmacy (if unopened and in a sealed
container) for disposition.
SB 1329 (Simitian, Chapter 709, Statutes of 2012) made a number
of changes to the way a Program could be authorized and the
entities eligible to donate medications under a Program. The
bill authorized a county public health officer, as delegated by
a county board of supervisors, to implement a Program, in
addition to Program implementation via county ordinance as
authorized in SB 798. SB 1329 also added several categories of
licensed health care facilities that may donate medications.
The bill also allowed both primary care clinic pharmacies and
primary care clinics that have Board licensees, to administer
and dispense medication, provided these Board licensees are in
good standing with the Board. SB 1329 established procedures
relating to county and Board approval of participating entities,
as well as authority for a county and the Board to prohibit a
certain entity from participating in a Program.
To date, two counties in California (Santa Clara and San Mateo)
have established a Program through ordinance, although the Santa
Clara Program is the only current operational program. As a
result of changes in SB 1329, medication can be donated from a
number of organizations, facilities and entities throughout the
state, but the only recipients of donated medications must be
located within Santa Clara County.
Program efforts in Santa Clara County are coordinated by
Supporting Initiatives to Redistribute Unused Medication and are
estimated to have resulted in significant impact and savings
since 2009:
772,000 units of medicine have been redistributed;
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$2 million of medicine have been donated;
Thousands of estimated uninsured patients have been
assisted; and
150 medicine donors are participating.
FISCAL EFFECT : Appropriation: Yes Fiscal Com.: Yes
Local: Yes
SUPPORT : (Verified 1/22/14)
Bethesda Home
Board of Pharmacy
California Association of Health Facilities
California Hospital Association
California Society of Health-System Pharmacists
Californians Against Waste
Lincoln Glen Manor and Nursing Facility
Santa Clara County Board of Supervisors
Supporting Initiatives to Redistribute Unused Medication
ARGUMENTS IN SUPPORT : According to the author's office,
existing law accounts for wholesale activities and the
appropriate licensing for those activities, but does not account
for third party intermediaries. Third party intermediaries
provide significantly different services than a wholesaler, and
therefore need licensing that reflects those services.
MW:k 1/22/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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