LRB-4551/1
PJH:kjf:rs
2005 - 2006 LEGISLATURE
February 13, 2006 - Introduced by Senators Roessler, Harsdorf and Kanavas,
cosponsored by Representatives
Montgomery, Underheim, Krawczyk, Hines,
Bies, Mursau, Musser, Ott, Hundertmark, Vos, Moulton, Towns and Albers.
Referred to Committee on Health, Children, Families, Aging and Long Term
Care.
SB599,1,6
1An Act to repeal 450.07 (2) and 450.07 (3);
to amend 450.01 (9) and 450.07
2(title); and
to create 450.01 (1m), 450.01 (2m), 450.01 (11m), 450.01 (11r),
3450.01 (13r), 450.01 (14m), 450.01 (21m), 450.01 (23), 450.01 (24), 450.071,
4450.072, 450.073 and 450.074 of the statutes;
relating to: the wholesale
5distribution of prescription drugs, granting rule-making authority, and
6providing a penalty.
Analysis by the Legislative Reference Bureau
This bill regulates the wholesale distribution of prescription drugs. Under the
bill, a "wholesale distributor" means a person engaged in the wholesale distribution
of prescription drugs, including but not limited to repackagers, own-label
distributors, private label distributors, jobbers, brokers, warehouses, including
manufacturers' and distributors' warehouses, and drug wholesalers or distributors,
independent wholesale drug traders, and retail pharmacies or chain pharmacy
warehouses that conduct wholesale distribution. Wholesale distribution does not
include: intracompany sales of prescription drugs; the administration, delivery,
dispensing, sale, purchase, distribution, trade, or transfer of a prescription drug or
offer to sell, purchase, distribute, trade, or transfer a prescription drug for emergency
medical reasons; the distribution of prescription drug samples by a manufacturer's
representative; drug returns, when conducted by a hospital, health care facility, or
charitable institution; the sale of minimal quantities of prescription drugs by retail
franchises to licensed health care providers for office use; the practice of pharmacy;
or the sale, transfer, merger, or consolidation of all or part of the business of a
pharmacy or pharmacies from or with another pharmacy or pharmacies, whether
accomplished as a purchase and sale of stock or business assets.
The bill requires the Pharmacy Examining Board (the board) to license
wholesale distributors, inspect wholesale distribution facilities, and investigate and
approve the designated representative of a wholesale distributor. Once licensed, a
wholesale distributor is required to create and maintain records of each prescription
drug transaction it undertakes.
Each wholesale distributor shall establish and maintain an inventory and
record (a pedigree) of all transactions regarding the receipt and distribution or other
disposition of a prescription drug. A pedigree must contain all necessary identifying
information concerning each sale or point of distribution in the chain of the
distribution of the prescription drug from the manufacturer until final sale or
distribution to a pharmacy or a person dispensing or distributing the prescription
drug. Each pedigree must be maintained by the final recipient in the chain of
distribution and by the wholesale distributor for three years from the date of sale or
distribution.
Under the bill, a person who distributes a prescription drug without the
appropriate licensure or without maintaining a proper pedigree is guilty of a Class
E felony, and may be fined up to $50,000 and imprisoned for up to 15 years or both.
A person who intentionally does the same is guilty of a Class D felony and may be
fined up to $100,000 and imprisoned for up to 25 years or both.
Because this bill creates a new crime or revises a penalty for an existing crime,
the Joint Review Committee on Criminal Penalties may be requested to prepare a
report concerning the proposed penalty and the costs or savings that are likely to
result if the bill is enacted.
For further information see the state fiscal estimate, which will be printed as
an appendix to this bill.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB599, s. 1
1Section
1. 450.01 (1m) of the statutes is created to read:
SB599,2,32
450.01
(1m) "Authentication" means verification, before distributing a
3prescription drug, that each transaction listed on a pedigree has occurred.
SB599, s. 2
4Section
2. 450.01 (2m) of the statutes is created to read:
SB599,3,25
450.01
(2m) "Chain pharmacy warehouse" means a physical location for drugs
6or devices that acts as a central warehouse and performs intracompany sales or
1transfers of the drugs or devices to a group of chain pharmacies that have the same
2common ownership and control.
SB599, s. 3
3Section
3. 450.01 (9) of the statutes is amended to read:
SB599,3,54
450.01
(9) "Distributor" means a person licensed by the board under s.
450.07
5(2) 450.071.
SB599, s. 4
6Section
4. 450.01 (11m) of the statutes is created to read:
SB599,3,87
450.01
(11m) "Facility" means a facility of a wholesale distributor where
8prescription drugs are stored, handled, repackaged, or offered for sale.
SB599, s. 5
9Section
5. 450.01 (11r) of the statutes is created to read:
SB599,3,1210
450.01
(11r) "Intracompany sales" means any transaction or transfer between
11any division, subsidiary, parent, or affiliated or related company under common
12ownership and control of a corporate entity.
SB599, s. 6
13Section
6. 450.01 (13r) of the statutes is created to read:
SB599,3,1614
450.01
(13r) "Normal distribution channel" means a chain of custody for a
15medication that goes from a manufacturer to a wholesale distributor to a pharmacy
16or a chain pharmacy warehouse to a patient.
SB599, s. 7
17Section
7. 450.01 (14m) of the statutes is created to read:
SB599,3,2018
450.01
(14m) "Pedigree" means a document or electronic file containing
19information that records each distribution of a prescription drug within the
20distribution channel.
SB599, s. 8
21Section
8. 450.01 (21m) of the statutes is created to read:
SB599,3,2522
450.01
(21m) "Repackage" means to repack or otherwise change the container,
23wrapper, or label of a prescription drug. Repackaging does not include the
24administration, delivery, or distribution of a prescription drug by a pharmacist to a
25patient.
SB599, s. 9
1Section
9. 450.01 (23) of the statutes is created to read:
SB599,4,22
450.01
(23) "Wholesale distribution" does not include:
SB599,4,33
(a) Intracompany sales of prescription drugs.
SB599,4,64
(b) The administration, delivery, dispensing, sale, purchase, distribution,
5trade, or transfer of a prescription drug or offer to sell, purchase, distribute, trade,
6or transfer a prescription drug for emergency medical reasons.
SB599,4,87
(c) The distribution of prescription drug samples by a manufacturer's
8representative.
SB599,4,109
(d) Drug returns, when conducted by a hospital, health care facility, or
10charitable institution.
SB599,4,1211
(e) The sale of minimal quantities of prescription drugs by retail franchises to
12licensed health care providers for office use.
SB599,4,1313
(f) The practice of pharmacy.
SB599,4,1614
(g) The sale, transfer, merger, or consolidation of all or part of the business of
15a pharmacy or pharmacies from or with another pharmacy or pharmacies, whether
16accomplished as a purchase and sale of stock or business assets.
SB599, s. 10
17Section
10. 450.01 (24) of the statutes is created to read:
SB599,4,2318
450.01
(24) "Wholesale distributor" means a person engaged in the wholesale
19distribution of prescription drugs, including but not limited to repackagers,
20own-label distributors, private label distributors, jobbers, brokers, warehouses,
21including manufacturers' and distributors' warehouses, and drug wholesalers or
22distributors, independent wholesale drug traders, and retail pharmacies or chain
23pharmacy warehouses that conduct wholesale distribution.
SB599, s. 11
24Section
11. 450.07 (title) of the statutes is amended to read:
SB599,4,25
25450.07 (title)
Manufacturers and distributors; licensure.
SB599, s. 12
1Section
12. 450.07 (2) of the statutes is repealed.
SB599, s. 13
2Section
13. 450.07 (3) of the statutes is repealed.
SB599, s. 14
3Section
14. 450.071 of the statutes is created to read:
SB599,5,9
4450.071 Wholesale distributors; licensure. (1) No person may engage in
5the wholesale distribution of a prescription drug in this state without obtaining a
6license from the board. The board shall exempt manufacturers from licensing and
7other requirements under this section to the extent the license or requirement is not
8required under federal law or regulation or unless the board determines that it is
9necessary to apply a requirement to a manufacturer.
SB599,5,11
10(2) An applicant shall submit a form provided by the board showing all of the
11following and swear or affirm the truthfulness of each item in the application:
SB599,5,1212
(a) The name, business address, and telephone number of the applicant.
SB599,5,1313
(b) All trade or business names used by the applicant.
SB599,5,1614
(c) Names, addresses, and telephone numbers of contact persons for all
15facilities used by the applicant for the storage, handling, and distribution of
16prescription drugs.
SB599,5,1717
(d) The type of ownership or operation for the applicant's business.
SB599,5,2018
(e) If the applicant's wholesale distribution business is a partnership, the
19name, address, title, and telephone number of each partner, and the name of the
20partnership.
SB599,5,2321
(f) If the applicant's wholesale distribution business is a corporation, the name,
22address, title, and telephone number of each corporate officer and director, the name
23of the corporation, and the state of incorporation.
SB599,5,2524
(g) If the applicant's wholesale distribution business is a sole proprietorship,
25the name of the sole proprietor and the name of the business entity.
SB599,6,2
1(h) A list of all licenses and permits issued to the applicant by any other state
2that authorizes the applicant to purchase or possess prescription drugs.
SB599,6,33
(i) The name, address, and telephone number of a designated representative.
SB599,6,54
(j) For the person listed in par. (i), a personal information statement that
5contains all of the following:
SB599,6,66
1. The person's date and place of birth.
SB599,6,77
2. The person's places of residence for the past 7 years.
SB599,6,98
3. The person's occupations, positions of employment, and offices held during
9the past 7 years.
SB599,6,1110
4. The name and addresses for each business, corporation, or other entity listed
11in subd. 3.
SB599,6,1412
5. A statement regarding whether the person has been, during the past 7 years,
13the subject of any proceeding for the revocation of any license or been prosecuted for
14any criminal offense, and the disposition of the proceeding or prosecution.
SB599,6,1815
6. A statement regarding whether the person has been, during the past 7 years,
16enjoined, either temporarily or permanently, from possessing, controlling, or
17distributing any prescription drug, and a description of the circumstances
18surrounding the injunction.