Amended in Assembly June 2, 2014

Amended in Senate January 27, 2014

Senate Bill No. 506

Introduced by Senator Hill

February 21, 2013

An act to amend, repeal, and add Section 11100 of, and to add and repeal Section 11100.02 of, the Health and Safety Code, relating to controlled substances.

LEGISLATIVE COUNSEL’S DIGEST

SB 506, as amended, Hill. Ephedrine: retail sale.

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(1) Existing

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begin insert Existing end insert law classifies controlled substances into 5 schedules, with the most restrictive limitations placed on controlled substances classified in Schedule I, and the least restrictive limitations placed on controlled substances classified in Schedule V. A controlled substance in any of the schedules may be possessed or dispensed only upon a lawful prescription, as specified. Existing law does not classify ephedrine, pseudoephedrine, norpseudoephedrine, or phenylpropanolamine within any of these 5 schedules, but provides that it is a crime, punishable as specified, for a person in this state who engages in specified transactions involving those drugs to fail to submit a report to the Department of Justice of all of those transactions, or to fail to submit an application to, and obtain a permit for the conduct of that business from, the Department of Justice, as specified. Existing law prohibits the sale of more than 3 packages or 9 grams of a nonprescription product containing ephedrine or the other drugs, as specified.

This bill would instead provide that it is a misdemeanor, punishable as specified, for a retail distributor, except pursuant to a valid prescription from a licensed practitioner with prescriptive authority, to sell or distribute to a person specified amounts of nonprescription products containing ephedrine, pseudoephedrine, norpseudoephedrine, or phenylpropanolamine within specified time limits, to sell or distribute any of those substances to a person whose information has generated an alert, or, except under specified conditions, to sell or distribute to a purchaser a nonprescription product containing any amount of those substances. The bill would contain provisions requiring the secure storage and monitoring of products containing any amount of ephedrine, pseudoephedrine, norpseudoephedrine, or phenylpropanolamine, as specified. begin insert By changing the definition of a crime, this bill would impose a state-mandated local program. end insert

The bill would require the Department of Justice to enter into a memorandum of understanding begin insert (MOU) end insert with the National Association of Drug Diversion Investigators (NADDI) and the vendor of the system governing access and oversight of the California transaction records regarding the transaction records, as specified, including requiring that begin delete NADDI reimburse the department for costs incurred in executing the memorandum of understanding, including the competitive bidding process, and for costs incurred in performing oversight and other duties end delete begin insert the end insert begin insert system be capable of interacting with purchase data from other states end insert . begin insert The bill would require the competitive bid to be completed within 6 months of the effective date of the bill and would require the MOU to be completed within 45 days of selecting the vendor. end insert The bill would also require, begin delete if end delete begin insert following the execution of end insert the memorandum of understanding begin delete is entered into end delete , retail distributors to transmit, on and after begin delete July 1, 2015, end delete begin insert August 1, 2015, end insert sale information to the system for purposes of determining whether the sale would violate these provisions. The bill would prohibit use of the information in the system for any purpose other than to meet the requirements of, or comply with, this act or a certain federal act, as specified. The bill would require that the system be available to the department and state law enforcement at no charge and would prohibit the Department of Justice or any other state agency from bearing any cost for the development, installation, or maintenance of the system. begin insert These provisions would remain in effect only until January 1, 2020. end insert The bill would begin insert also end insert specify legislative findings and intent.

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(2) The bill’s provisions would become operative as of February 1, 2015, but only if the NADDI voluntarily agrees, on or before January 15, 2015, to reimburse the Department of Justice for costs incurred in the execution of the memorandum of understanding, including the competitive bidding process, and for costs incurred in performing oversight and other duties, as specified. The bill would require the Department of Justice to post on its Internet Web site on or before January 19, 2015, whether or not NADDI has agreed to reimburse the department for these costs. The bill’s provisions would remain in effect only until January 1, 2019. By creating a new crime, this bill would impose a state-mandated local program.

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(3) The

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begin insert The end insert 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.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

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

SECTION 1.  

Section 11100 of the Health and Safety Code is
amended to read:

11100.  

(a) Any manufacturer, wholesaler, retailer, or other
person or entity in this state that sells, transfers, or otherwise
furnishes any of the following substances to any person or entity
in this state or any other state shall submit a report to the
Department of Justice of all of those transactions:

(1) Phenyl-2-propanone.

(2) Methylamine.

(3) Ethylamine.

(4) D-lysergic acid.

(5) Ergotamine tartrate.

(6) Diethyl malonate.

(7) Malonic acid.

(8) Ethyl malonate.

(9) Barbituric acid.

(10) Piperidine.

(11) N-acetylanthranilic acid.

(12) Pyrrolidine.

(13) Phenylacetic acid.

(14) Anthranilic acid.

(15) Morpholine.

(16) Ephedrine.

(17) Pseudoephedrine.

(18) Norpseudoephedrine.

(19) Phenylpropanolamine.

(20) Propionic anhydride.

(21) Isosafrole.

(22) Safrole.

(23) Piperonal.

(24) Thionyl chloride.

(25) Benzyl cyanide.

(26) Ergonovine maleate.

(27) N-methylephedrine.

(28) N-ethylephedrine.

(29) N-methylpseudoephedrine.

(30) N-ethylpseudoephedrine.

(31) Chloroephedrine.

(32) Chloropseudoephedrine.

(33) Hydriodic acid.

(34) Gamma-butyrolactone, including butyrolactone;
butyrolactone gamma; 4-butyrolactone; 2(3H)-furanone dihydro;
dihydro-2(3H)-furanone; tetrahydro-2-furanone; 1,2-butanolide;
1,4-butanolide; 4-butanolide; gamma-hydroxybutyric acid lactone;
3-hydroxybutyric acid lactone and 4-hydroxybutanoic acid lactone
with Chemical Abstracts Service number 96-48-0.

(35) 1,4-butanediol, including butanediol; butane-1,4-diol;
1,4-butylene glycol; butylene glycol; 1,4-dihydroxybutane;
1,4-tetramethylene glycol; tetramethylene glycol; tetramethylene
1,4-diol with Chemical Abstracts Service number 110-63-4.

(36) Red phosphorus, including white phosphorus,
hypophosphorous acid and its salts, ammonium hypophosphite,
calcium hypophosphite, iron hypophosphite, potassium
hypophosphite, manganese hypophosphite, magnesium
hypophosphite, sodium hypophosphite, and phosphorous acid and
its salts.

(37) Iodine or tincture of iodine.

(38) Any of the substances listed by the Department of Justice
in regulations promulgated pursuant to subdivision (b).

(b) The Department of Justice may adopt rules and regulations
in accordance with Chapter 3.5 (commencing with Section 11340)
of Part 1 of Division 3 of Title 2 of the Government Code that add
substances to subdivision (a) if the substance is a precursor to a
controlled substance and delete substances from subdivision (a).
However, no regulation adding or deleting a substance shall have
any effect beyond March 1 of the year following the calendar year
during which the regulation was adopted.

(c) (1) (A) Any manufacturer, wholesaler, retailer, or other
person or entity in this state, prior to selling, transferring, or
otherwise furnishing any substance specified in subdivision (a) to
any person or business entity in this state or any other state, shall
require (i) a letter of authorization from that person or business
entity that includes the currently valid business license number or
federal Drug Enforcement Administration (DEA) registration
number, the address of the business, and a full description of how
the substance is to be used, and (ii) proper identification from the
purchaser. The manufacturer, wholesaler, retailer, or other person
or entity in this state shall retain this information in a readily
available manner for three years. The requirement for a full
description of how the substance is to be used does not require the
person or business entity to reveal their chemical processes that
are typically considered trade secrets and proprietary information.

(B) For the purposes of this paragraph, “proper identification”
for in-state or out-of-state purchasers includes two or more of the
following: federal tax identification number; seller’s permit
identification number; city or county business license number;
license issued by the State Department of Public Health;
registration number issued by the federal Drug Enforcement
Administration; precursor business permit number issued by the
Department of Justice; driver’s license; or other identification
issued by a state.

(2) (A) A manufacturer, wholesaler, retailer, or other person
or entity in this state that exports a substance specified in
subdivision (a) to a person or business entity located in a foreign
country shall, on or before the date of exportation, submit to the
Department of Justice a notification of that transaction. The
notification shall include the name and quantity of the substance
to be exported and the name, address, and, if assigned by the
foreign country or subdivision thereof, business identification
number of the person or business entity located in a foreign country
importing the substance.

(B) The department may authorize the submission of the
notification on a monthly basis with respect to repeated, regular
transactions between an exporter and an importer involving a
substance specified in subdivision (a), if the department determines
that a pattern of regular supply of the substance exists between the
exporter and importer and that the importer has established a record
of utilization of the substance for lawful purposes.

(d) (1) A manufacturer, wholesaler, retailer, or other person or
entity in this state that sells, transfers, or otherwise furnishes a
substance specified in subdivision (a) to a person or business entity
in this state or any other state shall, not less than 21 days prior to
delivery of the substance, submit a report of the transaction, which
includes the identification information specified in subdivision
(c), to the Department of Justice. The Department of Justice may
authorize the submission of the reports on a monthly basis with
respect to repeated, regular transactions between the furnisher and
the recipient involving the substance or substances if the
Department of Justice determines that a pattern of regular supply
of the substance or substances exists between the manufacturer,
wholesaler, retailer, or other person or entity that sells, transfers,
or otherwise furnishes the substance or substances and the recipient
of the substance or substances, and the recipient has established a
record of utilization of the substance or substances for lawful
purposes.

(2) The person selling, transferring, or otherwise furnishing a
substance specified in subdivision (a) shall affix his or her signature
or otherwise identify himself or herself as a witness to the
identification of the purchaser or purchasing individual, and shall,
if a common carrier is used, maintain a manifest of the delivery
to the purchaser for three years.

(e) This section shall not apply to any of the following:

(1) A pharmacist or other authorized person who sells or
furnishes a substance upon the prescription of a physician, dentist,
podiatrist, or veterinarian.

(2) A physician, dentist, podiatrist, or veterinarian who
administers or furnishes a substance to his or her patients.

(3) A manufacturer or wholesaler licensed by the California
State Board of Pharmacy that sells, transfers, or otherwise furnishes
a substance to a licensed pharmacy, physician, dentist, podiatrist,
or veterinarian, or a retail distributor, provided that the
manufacturer or wholesaler submits records of any suspicious sales
or transfers as determined by the Department of Justice.

(4) An analytical research facility that is registered with the
federal Drug Enforcement Administration of the United States
Department of Justice.

(5)  A state-licensed health care facility that administers or
furnishes a substance to its patients.

(6) (A) The sale, transfer, furnishing, or receipt of a product
that contains ephedrine, pseudoephedrine, norpseudoephedrine,
or phenylpropanolamine and that is lawfully sold, transferred, or
furnished over the counter without a prescription pursuant to the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. Sec. 301 et seq.)
or regulations adopted thereunder. However, this section shall
apply to preparations in solid or liquid dosage form, except
pediatric liquid forms, as defined, containing ephedrine,
pseudoephedrine, norpseudoephedrine, or phenylpropanolamine
where the individual transaction involves more than three packages
or nine grams of ephedrine, pseudoephedrine, norpseudoephedrine,
or phenylpropanolamine.

(B) Any ephedrine, pseudoephedrine, norpseudoephedrine, or
phenylpropanolamine product subsequently removed from
exemption pursuant to Section 814 of Title 21 of the United States
Code shall similarly no longer be exempt from any state reporting
or permitting requirement, unless otherwise reinstated pursuant to
Section 814(d) of Title 21 of the United States Code as an exempt
product.

(7) The sale, transfer, furnishing, or receipt of a betadine or
povidone solution with an iodine content not exceeding 1 percent
in containers of eight ounces or less, or a tincture of iodine not
exceeding 2 percent in containers of one ounce or less, that is sold
over the counter.  

(8) The transfer of a substance specified in subdivision (a) for
purposes of lawful disposal as waste.

(f) (1) A person specified in subdivision (a) or (d) who does
not submit a report as required by that subdivision or who
knowingly submits a report with false or fictitious information
shall be punished by imprisonment in a county jail not exceeding
six months, by a fine not exceeding five thousand dollars ($5,000),
or by both the fine and imprisonment.

(2) Any person specified in subdivision (a) or (d) who has
previously been convicted of a violation of paragraph (1) shall,
upon a subsequent conviction thereof, be punished by
imprisonment pursuant to subdivision (h) of Section 1170 of the
Penal Code, or by imprisonment in a county jail not exceeding one
year, by a fine not exceeding one hundred thousand dollars
($100,000), or by both the fine and imprisonment.

(g) (1) Except as otherwise provided in subparagraph (A) of
paragraph (6) of subdivision (e), it is unlawful for a manufacturer,
wholesaler, retailer, or other person to sell, transfer, or otherwise
furnish a substance specified in subdivision (a) to a person under
18 years of age.

(2) Except as otherwise provided in subparagraph (A) of
paragraph (6) of subdivision (e), it is unlawful for any person under
18 years of age to possess a substance specified in subdivision (a).

(3) (A) A first violation of this subdivision is a misdemeanor.

(B) A person who has previously been convicted of a violation
of this subdivision shall, upon a subsequent conviction thereof, be
punished by imprisonment in a county jail not exceeding one year,
by a fine not exceeding ten thousand dollars ($10,000), or by both
the fine and imprisonment.

(h) This section shall remain in effect only until January 1, 2019,
and as of that date is repealed, unless a later enacted statute, that
is enacted before January 1, 2019, deletes or extends that date.

SEC. 2.  

Section 11100 is added to the Health and Safety Code,
to read:

11100.  

(a) Any manufacturer, wholesaler, retailer, or other
person or entity in this state that sells, transfers, or otherwise
furnishes any of the following substances to any person or entity
in this state or any other state shall submit a report to the
Department of Justice of all of those transactions:

(1) Phenyl-2-propanone.

(2) Methylamine.

(3) Ethylamine.

(4) D-lysergic acid.

(5) Ergotamine tartrate.

(6) Diethyl malonate.

(7) Malonic acid.

(8) Ethyl malonate.

(9) Barbituric acid.

(10) Piperidine.

(11) N-acetylanthranilic acid.

(12) Pyrrolidine.

(13) Phenylacetic acid.

(14) Anthranilic acid.

(15) Morpholine.

(16) Ephedrine.

(17) Pseudoephedrine.

(18) Norpseudoephedrine.

(19) Phenylpropanolamine.

(20) Propionic anhydride.

(21) Isosafrole.

(22) Safrole.

(23) Piperonal.

(24) Thionyl chloride.

(25) Benzyl cyanide.

(26) Ergonovine maleate.

(27) N-methylephedrine.

(28) N-ethylephedrine.

(29) N-methylpseudoephedrine.

(30) N-ethylpseudoephedrine.

(31) Chloroephedrine.

(32) Chloropseudoephedrine.

(33) Hydriodic acid.

(34) Gamma-butyrolactone, including butyrolactone;
butyrolactone gamma; 4-butyrolactone; 2(3H)-furanone dihydro;
dihydro-2(3H)-furanone; tetrahydro-2-furanone; 1,2-butanolide;
1,4-butanolide; 4-butanolide; gamma-hydroxybutyric acid lactone;
3-hydroxybutyric acid lactone and 4-hydroxybutanoic acid lactone
with Chemical Abstracts Service number 96-48-0.

(35) 1,4-butanediol, including butanediol; butane-1,4-diol;
1,4-butylene glycol; butylene glycol; 1,4-dihydroxybutane;
1,4-tetramethylene glycol; tetramethylene glycol; tetramethylene
1,4-diol with Chemical Abstracts Service number 110-63-4.

(36) Red phosphorus, including white phosphorus,
hypophosphorous acid and its salts, ammonium hypophosphite,
calcium hypophosphite, iron hypophosphite, potassium
hypophosphite, manganese hypophosphite, magnesium
hypophosphite, sodium hypophosphite, and phosphorous acid and
its salts.

(37) Iodine or tincture of iodine.

(38) Any of the substances listed by the Department of Justice
in regulations promulgated pursuant to subdivision (b).

(b) The Department of Justice may adopt rules and regulations
in accordance with Chapter 3.5 (commencing with Section 11340)
of Part 1 of Division 3 of Title 2 of the Government Code that add
substances to subdivision (a) if the substance is a precursor to a
controlled substance and delete substances from subdivision (a).
However, no regulation adding or deleting a substance shall have
any effect beyond March 1 of the year following the calendar year
during which the regulation was adopted.

(c) (1) (A) A manufacturer, wholesaler, retailer, or other person
or entity in this state, prior to selling, transferring, or otherwise
furnishing a substance specified in subdivision (a) to a person or
business entity in this state or any other state, shall require (i) a
letter of authorization from that person or business entity that
includes the currently valid business license number or federal
Drug Enforcement Administration (DEA) registration number, the
address of the business, and a full description of how the substance
is to be used, and (ii) proper identification from the purchaser. The
manufacturer, wholesaler, retailer, or other person or entity in this
state shall retain this information in a readily available manner for
three years. The requirement for a full description of how the
substance is to be used does not require the person or business
entity to reveal chemical processes that are typically considered
trade secrets and proprietary information.

(B) For the purposes of this paragraph, “proper identification”
for in-state or out-of-state purchasers includes two or more of the
following: federal tax identification number; seller’s permit
identification number; city or county business license number;
license issued by the State Department of Public Health;
registration number issued by the federal Drug Enforcement
Administration; precursor business permit number issued by the
Bureau of Narcotic Enforcement of the Department of Justice;
driver’s license; or other identification issued by a state.

(2) (A) A manufacturer, wholesaler, retailer, or other person
or entity in this state that exports a substance specified in
subdivision (a) to a person or business entity located in a foreign
country shall, on or before the date of exportation, submit to the
Department of Justice a notification of that transaction. The
notification shall include the name and quantity of the substance
to be exported and the name, address, and, if assigned by the
foreign country or subdivision thereof, business identification
number of the person or business entity located in a foreign country
importing the substance.

(B) The department may authorize the submission of the
notification on a monthly basis with respect to repeated, regular
transactions between an exporter and an importer involving a
substance specified in subdivision (a), if the department determines
that a pattern of regular supply of the substance exists between the
exporter and importer and that the importer has established a record
of utilization of the substance for lawful purposes.

(d) (1) A manufacturer, wholesaler, retailer, or other person or
entity in this state that sells, transfers, or otherwise furnishes a
substance specified in subdivision (a) to a person or business entity
in this state or any other state shall, not less than 21 days prior to
delivery of the substance, submit a report of the transaction, which
includes the identification information specified in subdivision
(c), to the Department of Justice. The Department of Justice may
authorize the submission of the reports on a monthly basis with
respect to repeated, regular transactions between the furnisher and
the recipient involving the substance or substances if the
Department of Justice determines that a pattern of regular supply
of the substance or substances exists between the manufacturer,
wholesaler, retailer, or other person or entity that sells, transfers,
or otherwise furnishes the substance or substances and the recipient
of the substance or substances, and the recipient has established a
record of utilization of the substance or substances for lawful
purposes.

(2) The person selling, transferring, or otherwise furnishing a
substance specified in subdivision (a) shall affix his or her signature
or otherwise identify himself or herself as a witness to the
identification of the purchaser or purchasing individual, and shall,
if a common carrier is used, maintain a manifest of the delivery
to the purchaser for three years.

(e) This section shall not apply to any of the following:

(1) A pharmacist or other authorized person who sells or
furnishes a substance upon the prescription of a physician, dentist,
podiatrist, or veterinarian.

(2) A physician, dentist, podiatrist, or veterinarian who
administers or furnishes a substance to his or her patients.

(3) A manufacturer or wholesaler licensed by the California
State Board of Pharmacy that sells, transfers, or otherwise furnishes
a substance to a licensed pharmacy, physician, dentist, podiatrist,
or veterinarian, or a retail distributor, provided that the
manufacturer or wholesaler submits records of any suspicious sales
or transfers as determined by the Department of Justice.

(4) An analytical research facility that is registered with the
federal Drug Enforcement Administration of the United States
Department of Justice.

(5) A state-licensed health care facility that administers or
furnishes a substance to its patients.

(6) (A) The sale, transfer, furnishing, or receipt of a product
that contains ephedrine, pseudoephedrine, norpseudoephedrine,
or phenylpropanolamine and that is lawfully sold, transferred, or
furnished over the counter without a prescription pursuant to the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. Sec. 301 et seq.)
or regulations adopted thereunder. However, this section shall
apply to preparations in solid or liquid dosage form, except
pediatric liquid forms, as defined, containing ephedrine,
pseudoephedrine, norpseudoephedrine, or phenylpropanolamine
where the individual transaction involves more than three packages
or nine grams of ephedrine, pseudoephedrine, norpseudoephedrine,
or phenylpropanolamine.

(B) An ephedrine, pseudoephedrine, norpseudoephedrine, or
phenylpropanolamine product subsequently removed from
exemption pursuant to Section 814 of Title 21 of the United States
Code shall similarly no longer be exempt from state reporting or
permitting requirements, unless otherwise reinstated pursuant to
Section 814(d) of Title 21 of the United States Code as an exempt
product.

(7) The sale, transfer, furnishing, or receipt of a betadine or
povidone solution with an iodine content not exceeding 1 percent
in containers of eight ounces or less, or a tincture of iodine not
exceeding 2 percent in containers of one ounce or less, that is sold
over the counter.

(8) Transfer of a substance specified in subdivision (a) for
purposes of lawful disposal as waste.

(f) (1) A person specified in subdivision (a) or (d) who does
not submit a report as required by that subdivision or who
knowingly submits a report with false or fictitious information
shall be punished by imprisonment in a county jail not exceeding
six months, by a fine not exceeding five thousand dollars ($5,000),
or by both the fine and imprisonment.

(2) A person specified in subdivision (a) or (d) who has
previously been convicted of a violation of paragraph (1) shall,
upon a subsequent conviction thereof, be punished by
imprisonment pursuant to subdivision (h) of Section 1170 of the
Penal Code, or by imprisonment in a county jail not exceeding one
year, by a fine not exceeding one hundred thousand dollars
($100,000), or by both the fine and imprisonment.

(g) (1) Except as otherwise provided in subparagraph (A) of
paragraph (6) of subdivision (e), it is unlawful for a manufacturer,
wholesaler, retailer, or other person to sell, transfer, or otherwise
furnish a substance specified in subdivision (a) to a person under
18 years of age.

(2) Except as otherwise provided in subparagraph (A) of
paragraph (6) of subdivision (e), it is unlawful for a person under
18 years of age to possess a substance specified in subdivision (a).

(3) Notwithstanding any other law, it is unlawful for a retail
distributor to (A) sell in a single transaction more than three
packages of a product that he or she knows to contain ephedrine,
pseudoephedrine, norpseudoephedrine, or phenylpropanolamine,
or (B) knowingly sell more than nine grams of ephedrine,
pseudoephedrine, norpseudoephedrine, or phenylpropanolamine,
other than pediatric liquids as defined. Except as otherwise
provided in this section, the three package per transaction limitation
or nine gram per transaction limitation imposed by this paragraph
shall apply to any product that is lawfully sold, transferred, or
furnished over the counter without a prescription pursuant to the
Federal Food, Drug, and Cosmetic Act (21 U.S.C. Sec. 301 et
seq.), or regulations adopted thereunder, unless exempted from
the requirements of the federal Controlled Substances Act (21
U.S.C. Sec. 801 et seq.) by the federal Drug Enforcement
Administration pursuant to Section 814 of Title 21 of the United
States Code.

(4) (A) A first violation of this subdivision is a misdemeanor.

(B) A person who has previously been convicted of a violation
of this subdivision shall, upon a subsequent conviction thereof, be
punished by imprisonment in a county jail not exceeding one year,
by a fine not exceeding ten thousand dollars ($10,000), or by both
the fine and imprisonment.

(h) For the purposes of this article, the following terms have
the following meanings:

(1) “Drug store” is an entity described in Code 5912 of the
Standard Industrial Classification (SIC) Manual published by the
United States Office of Management and Budget, 1987 edition.

(2) “General merchandise store” is an entity described in Codes
5311 to 5399, inclusive, and Code 5499 of the Standard Industrial
Classification (SIC) Manual published by the United States Office
of Management and Budget, 1987 edition.

(3) “Grocery store” is an entity described in Code 5411 of the
Standard Industrial Classification (SIC) Manual published by the
United States Office of Management and Budget, 1987 edition.

(4) “Pediatric liquid” means a nonencapsulated liquid whose
unit measure according to product labeling is stated in milligrams,
ounces, or other similar measure. In no instance shall the dosage
units exceed 15 milligrams of phenylpropanolamine or
pseudoephedrine per five milliliters of liquid product, except for
liquid products primarily intended for administration to children
under two years of age for which the recommended dosage unit
does not exceed two milliliters and the total package content does
not exceed one fluid ounce.

(5) “Retail distributor” means a grocery store, general
merchandise store, drugstore, or other related entity, the activities
of which, as a distributor of ephedrine, pseudoephedrine,
norpseudoephedrine, or phenylpropanolamine products, are limited
exclusively to the sale of ephedrine, pseudoephedrine,
norpseudoephedrine, or phenylpropanolamine products for personal
use both in number of sales and volume of sales, either directly to
walk-in customers or in face-to-face transactions by direct sales.
“Retail distributor” includes an entity that makes a direct sale, but
does not include the parent company of that entity if the company
is not involved in direct sales regulated by this article.

(6) “Sale for personal use” means the sale, in a single
transaction, to an individual customer for a legitimate medical use
of a product containing ephedrine, pseudoephedrine,
norpseudoephedrine, or phenylpropanolamine in dosages at or
below that specified in paragraph (3) of subdivision (g). “Sale for
personal use” also includes the sale of those products to employers
to be dispensed to employees from first aid kits or medicine chests.

(i) It is the intent of the Legislature that this section shall
preempt all local ordinances or regulations governing the sale by
a retail distributor of over-the-counter products containing
ephedrine, pseudoephedrine, norpseudoephedrine, or
phenylpropanolamine.

(j) This section shall become operative on January 1, 2019.

SEC. 3.  

Section 11100.02 is added to the Health and Safety
Code, to read:

11100.02.  

(a) Notwithstanding any other law, it is unlawful
for a retail distributor to knowingly do any of the following, except
pursuant to a valid prescription from a licensed practitioner with
prescriptive authority:

(1) To sell or distribute to the same purchaser within a 30-day
period more than 9 grams, or within a day more than 3.6 grams,
of ephedrine base, pseudoephedrine base, norpseudoephedrine
base, or phenylpropanolamine base contained in a product that is
lawfully sold, transferred, or furnished over the counter without a
prescription pursuant to the Federal Food, Drug, and Cosmetic
Act (21 U.S.C. Sec. 301 et seq.), or regulations adopted thereunder,
unless exempted from the requirements of the federal Controlled
Substances Act (21 U.S.C. Sec. 801 et seq.) by the federal Drug
Enforcement Administration pursuant to Section 814 of Title 21
of the United States Code.

(2) To sell or distribute ephedrine, pseudoephedrine,
norpseudoephedrine, or phenylpropanolamine to a person whose
information has generated an alert as described in paragraph (3)
of subdivision (d) regarding that sale.

(3) To sell or distribute to a purchaser a nonprescription product
containing any amount of ephedrine, pseudoephedrine,
norpseudoephedrine, or phenylpropanolamine, except under the
following conditions:

(A) The purchaser shall produce valid government-issued photo
identification.

(B) The purchaser shall sign a written or electronic log showing
all of the following:

(i) The date and time of the transaction.

(ii) The identification number presented.

(iii) The agency issuing the identification and the type of
identification issued.

(iv) The name, date of birth, and address of the purchaser.

(v) The amount of ephedrine base, pseudoephedrine base,
norpseudoephedrine base, or phenylpropanolamine base contained
in the material, compound, mixture, or preparation sold.

(b) The retail distributor shall store any product containing any
amount of ephedrine, pseudoephedrine, norpseudoephedrine, or
phenylpropanolamine either behind the counter or in a locked
cabinet so that the customer does not have access to the product.

(c) (1) To facilitate the monitoring of the sales of
nonprescription products containing ephedrine, pseudoephedrine,
norpseudoephedrine, or phenylpropanolamine, the retail distributor
shall record all of the following information at the point of sale
regarding the proposed transaction for the purpose of complying
with this section or the federal Combat Methamphetamine
Epidemic Act of 2005, or any regulation adopted pursuant to this
section or that act, and for no other purpose:

(A) The date and time of the transaction.

(B) The identification number of the purchaser, issuing agency
of the identification, and the type of identification used.

(C) The name, date of birth, and address of the purchaser
verified through a photo identification of the purchaser.

(D) The name, quantity of packages, and total gram weight of
ephedrine base, pseudoephedrine base, norpseudoephedrine base,
or phenylpropanolamine base contained in a product or products
purchased, received, or otherwise acquired.

(E) The name or initials of the person making the sale.

(2) (A) On and after begin delete July 1, 2015, end delete begin insert August 1, 2015, end insert the retail
distributor shall transmit the information immediately to a vendor
begin insert selected by the department end insert to collect, administer, and provide
access to the transaction data for purposes of determining whether
the proposed sale would violate this section and therefore may not
proceed, provided that the system is available to retailers in the
state without a charge for accessing the system. The transaction
information shall not be accessed, stored, or used by the retail
distributor or law enforcement for any purpose other than to meet
the requirements set forth in this section or to comply with the
provisions of the federal Combat Methamphetamine Epidemic Act
of 2005, or any regulation adopted pursuant to this section or that
act. The retail distributor shall not maintain a separate copy of the
transaction information and shall not have direct access to
individual information or sales records entered into the system,
except as required by the federal Combat Methamphetamine
Epidemic Act of 2005.

(B) Subparagraph (A) shall begin delete only end delete become operative begin delete if the
department executes end delete begin insert following the department’s execution of end insert a
memorandum of understanding (MOU) with NADDI and the
vendor of the system governing access and oversight of the
California transaction records pursuant to paragraph (1) of
subdivision (d). Prior to executing the MOU, the Department of
Justice shall carry out a competitive bidding process for a vendor
to collect, administer, and provide access to the transaction data
transmitted by retail distributors. begin insert The competitive bid shall be
completed by the department and the selected vendor within six
months of the effective date of the act adding this section. The
MOU shall be completed within 45 days of the vendor selection.
The competitive bid shall require the vendor to operate a system
that is operable on a real-time basis for 24 hours per day seven
days per week and is capable of interacting with purchase data
from other states in order to prevent a person from attempting to
exceed state purchase limits by crossing state lines. end insert

(3) (A) A retail distributor shall provide notice electronically,
in writing, or by signage to purchasers at the time of purchase that
the information collected pursuant to the federal Combat
Methamphetamine Epidemic Act of 2005 and this section shall be
entered into a single database as specified in paragraph (2) and
provided to law enforcement for purposes of determining the
legality of a proposed sale.

(B) Probable cause shall be demonstrated to trigger an
investigation in connection with an individual whose requested
purchase is denied by the system a single time.

(C) Access by law enforcement to the data contained in the
system from a location other than the retailer shall be limited to
the records of an individual whose attempted purchase has been
denied by the system.

(4) This subdivision shall not be construed to require a retail
distributor to maintain state-required records relating to the sale
of products containing ephedrine, pseudoephedrine,
norpseudoephedrine, or phenylpropanolamine in a separate location
or log from records required by federal law to be kept with respect
to those products.

(5) The recording requirements specified in this subdivision
shall not apply to the sale of a single package containing not more
than 60 milligrams of pseudoephedrine, consistent with the federal
Combat Methamphetamine Epidemic Act of 2005.

(6) If a retail distributor experiences mechanical or electronic
failure of the system and is unable to comply with the recording
requirements of this subdivision, the retail distributor shall maintain
the required records in a written log or an alternative electronic
recordkeeping mechanism until the retail distributor is able to
comply with the recording requirements of this subdivision. Written
logs shall be maintained only for the purpose of compliance with
this subdivision.

begin delete

(d) (1) The MOU described in paragraph (2) of subdivision (c)
between the department, NADDI, and the vendor of the system
shall require NADDI to reimburse the department for costs incurred
in executing the MOU, including the competitive bidding process,
and for costs incurred in performing oversight and other duties
required by this section and the MOU.

end delete begin delete

(2)

end delete

begin insert (d) end insert   begin insert (1) end insert begin insert   end insert The MOU shall require NADDI to forward California
transaction records in the system to the Department of Justice
weekly and provide real-time access to the information through
the vendor’s online portal to law enforcement in the state as
authorized by the department.

begin delete

(3)

end delete

begin insert (2) end insert  The MOU shall constitute an enforceable contract.

begin delete

(4)

end delete

begin insert (3) end insert  Access to the system shall be available at no charge to the
department and law enforcement in this state as authorized pursuant
to paragraph (1).

begin delete

(5)

end delete

begin insert (4) end insert  The system shall allow retail distributors of products
containing ephedrine, pseudoephedrine, norpseudoephedrine, or
phenylpropanolamine to enter into the database the information
specified in subdivision (c) regarding the proposed sale of those
products.

begin delete

(6)

end delete

begin insert (5) end insert  The system shall be capable of providing the retail distributor
with an immediate real-time alert any time a provision of this
section is being violated by a proposed sale.

begin delete

(7)

end delete

begin insert (6) end insert  Neither the department nor any state agency shall bear any
cost for the development, installation, or maintenance of the
system.

begin delete

(8)

end delete

begin insert (7) end insert  The MOU shall state that no party to the MOU nor any entity
under contract to provide the electronic authorization and
monitoring system shall be authorized to use the information
contained in the system for any purpose other than those set forth
in this section, the federal Combat Methamphetamine Epidemic
Act of 2005, or any regulation adopted pursuant to this section or
that act. However, the system operator shall be authorized to
analyze the information for the sole purpose of assessing and
improving the performance and efficacy of the system. In addition,
the MOU shall require that a retail distributor’s access to the
electronic authorization and monitoring system’s database is
limited solely to records of sales transactions made by that retail
distributor, which access shall be solely for purposes of complying
with the federal Combat Methamphetamine Epidemic Act of 2005
or this section, or to respond to a duly authorized law enforcement
request or court order for information collected under that act or
this section.

begin delete

(9)

end delete

begin insert (8) end insert  The system’s security program shall comply with the security
standards for the Criminal Justice Information System of the
Federal Bureau of Investigation and may be audited once a year
by the department.

begin delete

(10)

end delete

begin insert (9) end insert  The use of the system by a retail distributor or vendor of the
system shall be subject to Section 56.101 of the Civil begin delete Code,
including the purchaser’s right of access or to receive a copy of
his or her purchaser records end delete begin insert Code end insert . begin insert A retail distributor shall provide
a vendor telephone access number so that purchasers who have
questions regarding their purchase denial or history may contact
the vendor. end insert A retail distributor or a vendor of the system holding
the data shall not maintain any records collected under this system
for longer than two years, or as otherwise required by the federal
Combat Methamphetamine Epidemic Act of 2005 and shall be
destroyed pursuant to Section 1798.81 of the Civil Code.

begin delete

(11)

end delete

begin insert (10) end insert  Law enforcement access to the system shall be recorded
by means of a unique access code for each individual accessing
the system begin insert and an investigation number for each query end insert . Each user’s
history shall be maintained and may be audited by the department.

begin delete

(12)

end delete

begin insert (11) end insert  The department may submit recommendations to NADDI
regarding system changes to assist in identifying false identification
cards.

begin delete

(13)

end delete

begin insert (12) end insert  Disputes relating to compliance with this section arising
against a vendor of the system shall be subject to a court of
competent jurisdiction in California and shall be governed by
California law.

(e) The State Board of Equalization shall notify all retailers
about the requirement to submit transactions to the system no later
than April 1, 2014.

(f) This section shall not apply to a health care practitioner with
prescriptive authority who is currently licensed in this state.

(g) (1) A first violation of this section is a misdemeanor.

(2) A person who has previously been convicted of a violation
of this section shall, upon a subsequent conviction thereof, be
punished by imprisonment in a county jail not exceeding one year,
by a fine not exceeding ten thousand dollars ($10,000), or by both
the fine and imprisonment.

(h) For the purposes of this section, the following terms have
the following meanings:

(1) “Department” means the Department of Justice.

(2) “Drug store” is an entity described in Code 5912 of the
Standard Industrial Classification (SIC) Manual published by the
United States Office of Management and Budget, 1987 edition.

(3) “General merchandise store” is an entity described in Codes
5311 to 5399, inclusive, and Code 5499 of the Standard Industrial
Classification (SIC) Manual published by the United States Office
of Management and Budget, 1987 edition.

(4) “Grocery store” is an entity described in Code 5411 of the
Standard Industrial Classification (SIC) Manual published by the
United States Office of Management and Budget, 1987 edition.

(5) “Retail distributor” means a grocery store, general
merchandise store, drugstore, or other related entity, the activities
of which, as a distributor of ephedrine, pseudoephedrine,
norpseudoephedrine, or phenylpropanolamine products, are limited
exclusively to the sale of ephedrine, pseudoephedrine,
norpseudoephedrine, or phenylpropanolamine products for personal
use both in number of sales and volume of sales, either directly to
walk-in customers or in face-to-face transactions by direct sales.
“Retail distributor” includes an entity that makes a direct sale, but
does not include the parent company of that entity if the company
is not involved in direct sales regulated by this article.

(6) “Sale for personal use” means the sale in a single transaction
to an individual customer for a legitimate medical use of a product
containing ephedrine, pseudoephedrine, norpseudoephedrine, or
phenylpropanolamine in amounts at or below that specified in
subdivision (a). “Sale for personal use” also includes the sale of
those products to employers to be dispensed to employees from
first aid kits or medicine chests.

(i) It is the intent of the Legislature that this section shall
preempt all local ordinances or regulations governing the sale by
a retail distributor of over-the-counter products containing
ephedrine, pseudoephedrine, norpseudoephedrine, or
phenylpropanolamine.

(j) This section shall remain in effect only until January 1, begin delete 2019, end delete
begin insert 2020, end insert and as of that date is repealed, unless a later enacted statute,
that is enacted before January 1, begin delete 2019, end delete begin insert 2020, end insert deletes or extends
that date.

SEC. 4.  

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.

begin delete

SEC. 5.  

(a) This act shall become operative on February 1,
2015.

(b) This act shall become operative only if the National
Association of Drug Diversion Investigators (NADDI) voluntarily
agrees, on or before January 15, 2015, to reimburse the department
for costs incurred in the execution of the memorandum of
understanding, including the competitive bidding process, and for
costs incurred in performing oversight and other duties as described
in Section 11100.02 of the Health and Safety Code, as amended
by this act. The Department of Justice shall post on its Internet
Web site on or before January 19, 2015, whether or not NADDI
has agreed to reimburse the department for these costs.

end delete