Bill Text: CA SB1071 | 2009-2010 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

---

Bill Title: Personal income tax: credit: prescription drugs:

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2010-06-16 - From committee with author's amendments. Read second time. Amended. Re-referred to Com. on HEALTH. Set, second hearing. Hearing canceled at the request of author. [SB1071 Detail]

Download: California-2009-SB1071-Amended.html

---

BILL NUMBER: SB 1071	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MARCH 24, 2010

INTRODUCED BY   Senator DeSaulnier

                        FEBRUARY 17, 2010

   An act to amend Section 11165 of  , and add Section 11165.05
to,  the Health and Safety Code, relating to controlled
substances.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 1071, as amended, DeSaulnier. Controlled Substance Utilization
Review and Evaluation System.
   Existing law provides for the electronic monitoring and reporting
of the prescribing and dispensing of Schedule II, Schedule III, and
Schedule IV controlled substances pursuant to the Controlled
Substance Utilization Review and Evaluation System (CURES) program.
   This bill would  require the Department of Justice, beginning
January 1, 2011, and annually thereafter, to determine and impose a
fee on manufacturers and importers of controlled substances
classified in Schedules II, III, and IV, as specified. The bill would
require the State Board of Equalization to administer and collect
the fee, as specified, and to deposit the fee in the CURES Fund
established by the bill. The moneys in the CURES Fund would be
available for expenditure, upon appropriation by the Legislature,
only for reimbursement of the department for specified costs related
  to the CURES program. The bill would require that the fee
imposed shall be consistent with all applicable legal requirements
for imposing fees, as specified. The bill would  make technical,
nonsubstantive changes to  these   specified
 provisions  relating to the CURES program  .
   Vote: majority. Appropriation: no. Fiscal committee:  no
  yes  . State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    The Legislatures finds and declares all
of the following:  
   (a) The CURES program is a valuable investigative, preventive, and
educational tool for law enforcement, regulatory boards, educational
researchers, and the health care community.  
   (b) Each year the CURES program responds to more than 60,000
requests from practitioners and pharmacists to (1) help identify and
deter drug abuse and diversion through accurate and rapid tracking of
Schedule II, III, and IV controlled substances, (2) help
practitioners make better prescribing decisions, and (3) cut down on
the misuse, abuse, and trafficking of prescription drugs in
California.  
   (c) The manufacture and importation of Schedules II, III, and IV
controlled substances have had deleterious effects on private and
public interests, including the misuse, abuse, and trafficking in
dangerous prescription medications resulting in injury and death. The
fee that is imposed by this bill on manufacturers and importers of
Schedules II, III, and IV controlled substances is to be limited in
amount and seeks to mitigate these effects of the drugs by supporting
the operation of the CURES program, which has proved a
cost-effective tool to help to reduce the misuse, abuse, and
trafficking of those drugs. There is a sufficient nexus between the
fee this bill imposes on manufacturers and importers of Schedule II,
III, and IV controlled substances and the deleterious effects the
bill would ameliorate through its funding of the CURES program.

   (d) It is the nature of these Schedule II, III, and IV controlled
substances that their addictive qualities and the ever present market
for their misuse and abuse pose inherent risks to public health that
must be systematically addressed, as by the CURES program. Once
these products are present in California, ad hoc enforcement of
conditions on distribution and criminal and civil sanctions on
downstream actors in the distribution system is an extraordinarily
costly, ineffective, and inefficient means to attempt to control the
misuse, abuse, and trafficking of these substances. It is therefore
appropriate for manufacturers and importers, which benefit from the
commercial markets for these inherently dangerous products with
knowledge of their potential for misuse and abuse absent systematic
tracking and monitoring, to pay for the cost-effective CURES program.
 
   (e) The Legislature declares that the imposition of a fee upon the
manufacturers and importers of Schedule II, III and IV controlled
substances by this act would not result in the imposition of a tax
within the meaning of Article XIII of the California Constitution,
because the amount and nature of the fee has a fair and reasonable
relationship to the adverse impact and burden imposed by the
manufacture and importation of Schedule II, III, and IV controlled
substances. 
   SECTION 1.   SEC. 2.   Section 11165 of
the Health and Safety Code is amended to read:
   11165.  (a) To assist law enforcement and regulatory agencies in
their efforts to control the diversion and resultant abuse of
Schedule II, Schedule III, and Schedule IV controlled substances, and
for statistical analysis, education, and research, the Department of
Justice shall, contingent upon the availability of adequate funds
 from the CURES Fund and  from the Contingent Fund of the
Medical Board of California, the Pharmacy Board Contingent Fund, the
State Dentistry Fund, the Board of Registered Nursing Fund, and the
Osteopathic Medical Board of California Contingent Fund, maintain the
Controlled Substance Utilization Review and Evaluation System
(CURES) for the electronic monitoring of the prescribing and
dispensing of Schedule II, Schedule III, and Schedule IV controlled
substances by all practitioners authorized to prescribe or dispense
these controlled substances.
   (b) The reporting of Schedule III and Schedule IV controlled
substance prescriptions to CURES shall be contingent upon the
availability of adequate funds from the Department of Justice. The
Department of Justice may seek and use grant funds to pay the costs
incurred from the reporting of controlled substance prescriptions to
CURES. Funds shall not be appropriated from the Contingent Fund of
the Medical Board of California, the Pharmacy Board Contingent Fund,
the State Dentistry Fund, the Board of Registered Nursing Fund, the
Naturopathic Doctor's Fund, or the Osteopathic Medical Board of
California Contingent Fund to pay the costs of reporting Schedule III
and Schedule IV controlled substance prescriptions to CURES.
   (c) CURES shall operate under existing provisions of law to
safeguard the privacy and confidentiality of patients. Data obtained
from CURES shall only be provided to appropriate state, local, and
federal persons or public agencies for disciplinary, civil, or
criminal purposes and to other agencies or entities, as determined by
the Department of Justice, for the purpose of educating
practitioners and others in lieu of disciplinary, civil, or criminal
actions. Data may be provided to public or private entities, as
approved by the Department of Justice, for educational, peer review,
statistical, or research purposes, provided that patient information,
including any information that may identify the patient, is not
compromised. Further, data disclosed to any individual or agency as
described in this subdivision shall not be disclosed, sold, or
transferred to any third party.
   (d) For each prescription for a Schedule II, Schedule III, or
Schedule IV controlled substance, the dispensing pharmacy or clinic
shall provide the following information to the Department of Justice
on a weekly basis and in a format specified by the Department of
Justice:
   (1) The full name, address, and telephone number of the ultimate
user or research subject, or contact information as determined by the
Secretary of the United States Department of Health and Human
Services, and the gender and date of birth of the ultimate user.
   (2) The prescriber's category of licensure and license number;
federal controlled substance registration number; and the state
medical license number of any prescriber using the federal controlled
substance registration number of a government-exempt facility.
   (3) Pharmacy prescription number, license number, and federal
controlled substance registration number.
   (4) NDC (National Drug Code) number of the controlled substance
dispensed.
   (5) Quantity of the controlled substance dispensed.
   (6) ICD-9 (diagnosis code), if available.
   (7) Number of refills ordered.
   (8) Whether the drug was dispensed as a refill of a prescription
or as a first-time request.
   (9) Date of origin of the prescription.
   (10) Date of dispensing of the prescription.
   SEC. 3.    Section 11165.05 is added to the 
 Health and Safety Code   , to read:  
   11165.05.  (a) The Department of Justice shall, beginning January
1, 2011, and annually thereafter, impose a fee on manufacturers and
importers of controlled substances classified in Schedule II, III, or
IV in order to reimburse the department for costs related to the
CURES program which provides for the electronic monitoring of the
prescribing and dispensing of controlled substances classified in
Schedule II, III, or IV.
   (b) The department shall impose a fee on manufacturers and
importers of controlled substances classified in Schedule II, III, or
IV that the department determines to be sufficient for, and limited
to, reimbursement of the department for the following expenses:
   (1) The cost of the administration of the CURES program as
required by this section and Sections 11165 and 11165.1.
   (2) The cost of the maintenance of, and any improvements to, the
CURES program.
   (3) The cost of education and outreach relating to the CURES
program.
   (4) The cost of the investigation of abuses of the CURES program.
   (c) The State Board of Equalization shall administer and collect
the fee imposed by the department in compliance with the following:
   (1) The board may prescribe, adopt, and enforce regulations
relating to the administration and enforcement of this section,
including, but not limited to, regulations governing collections,
reports, refunds, and appeals relating to the fee imposed by this
section.
   (2) The board may prescribe, adopt, and enforce emergency
regulations as necessary to implement the fee imposed by this
section.
   (3) The imposed fee shall be due and payable from the manufacturer
or importer to the board on a quarterly basis, on or before the last
day of the second month following each calendar quarter.
   (4) Each manufacturer or importer of controlled substances
classified in Schedule II, III, or IV shall, on or before the last
day of the second month following each calendar quarter, pay the
imposed fee and file a return for the preceding quarterly period with
the board using electronic media, as prescribed by the board.
Returns shall be authenticated in a form or pursuant to methods as
may be prescribed by the board.
   (5) The board may, to facilitate administration of the fee,
require that the payment of the fee and filing of the returns be made
for periods other than quarterly periods.
   (d) The CURES Fund is hereby established in the State Treasury.
All fees imposed under this section, and any interest or penalties
imposed by the department or board with respect to those fees, shall
be paid to the board in the form of remittances payable to the board.
The board shall transmit any payment to the Treasurer for deposit in
the CURES Fund.
   (e) Except for payments required to reimburse the board for its
administrative costs in collecting the fee imposed by this section,
all moneys deposited in the CURES Fund shall, upon appropriation by
the Legislature, be expended only for the purposes specified in
subdivision (b).
   (f) Any fee imposed pursuant to this section shall be consistent
with all applicable legal requirements for imposing fees, including
the requirements set forth in Sinclair Paint Co. v. State Bd. of
Equalization (1997) 15 Cal.4th 866.