Bill Text: CA SB341 | 2009-2010 | Regular Session | Amended

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

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Bill Title: Pharmaceuticals: adverse drug reactions: Drug Safety and

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced - Dead) 2010-02-01 - Returned to Secretary of Senate pursuant to Joint Rule 56. [SB341 Detail]

Download: California-2009-SB341-Amended.html

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BILL NUMBER: SB 341	AMENDED
	BILL TEXT

	AMENDED IN SENATE  MARCH 31, 2009

INTRODUCED BY   Senator DeSaulnier

                        FEBRUARY 25, 2009

   An act to add Article 7 (commencing with Section 111657) to
Chapter 6 of Part 5 of Division 104 of the Health and Safety Code,
relating to pharmaceuticals.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 341, as amended, DeSaulnier. Pharmaceuticals: adverse drug
reactions: Drug Safety and Effectiveness Program.
   Existing law, the Sherman Food, Drug, and Cosmetic Law, regulates
the packaging, labeling, and advertising of food, drugs, and
cosmetics, under the administration of the State Department of Public
Health.
   This bill would require the department to make every effort to
enter into a contract or agreement with the University of California
to establish a program to evaluate the safety and effectiveness of
prescription drugs in California. This bill would require, if the
department and the University of California enter into a contract or
agreement to establish the program, that the program include
specified components, including, among other things, a determination
of the classes of prescription drugs that are advertised to
consumers, marketed to physicians, or both, in California, and an
Internet Web site designed to disseminate information to health care
professionals and consumers on the relative safety and effectiveness
of those drugs, as specified.  The program shall include, until
January 1, 2015, a prescription education service, as specified.

   This bill would impose a fee, to be established by the department,
on any manufacturer of drugs to which the bill applies, in an amount
determined by the department, in consultation with the University of
California, and limited to the amount necessary to fund the actual
and necessary expenses of the University of California in
implementing the program. This bill would require the fee to be
collected by the State Board of Equalization, and to be deposited
into the Drug Safety and Effectiveness Fund, which would be created
by the bill, and used, upon appropriation by the Legislature, for
purposes of the bill.
   This bill would specify that the provisions relating to the
establishment and the collection of this fee shall not be implemented
until the department and the University of California enter into a
contract or agreement, as provided for in the bill. 
   The bill would require the department to provide an annual report
on the service to specified legislative committees. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


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

  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) Since 1997, when the United States Food and Drug
Administration (FDA) allowed drug manufacturers to advertise directly
to consumers, the amount spent on advertising has risen
dramatically.
   (b) According to the United States General Accounting Office (GAO)
report, the pharmaceutical industry spent $2.7 billion in 2001 on
direct-to-consumer advertising. A December 6, 2004, New York Times
report states that such spending has reached $3.8 billion.
   (c) According to the same GAO report, while overall spending on
drug promotion was less than spending on research and development
($19.1 billion versus $30.3 billion), spending on direct-to-consumer
advertising is increasing at a faster rate than overall drug
promotion spending or spending on research and development. Between
1997 and 2001, the increase in direct-to-consumer advertising was 145
percent compared to a 59 percent increase for research and
development.
   (d) Although the FDA is responsible for postmarket surveillance of
prescription drugs, numerous concerns have been raised about the
adequacy of these efforts.
   (e) An unpublished internal FDA study from 2002 revealed that 18
percent of FDA scientists reported being pressured to approve a new
drug "despite reservations about the safety, efficacy or quality of
the drug."
   (f) A 1999 FDA survey and a Kaiser Family Foundation survey both
found that more than 50 million people respond to drug advertisements
by asking their doctor whether the advertised medications might work
for them. At the same time, both surveys showed that almost 60
percent of consumers found the side-effect warnings in these
advertisements to be inadequate.
   (g) Pressure to get new drugs to market, combined with the vast
amount of drug marketing undertaken by manufacturers, make it
difficult to address a threat once it is identified. Recent studies
linking the use of popular, widely promoted prescription drugs to
serious public health concerns point to the need for greater
oversight to protect the public.
   (h) Drugs that are frequently advertised to consumers present
special safety concerns because direct-to-consumer advertising is
likely to minimize potential side effects and safety concerns and
because advertised drugs are likely to be highly utilized by
Californians.
   (i) Californians do not have a reliable central repository of
information about prescription drug safety and effectiveness.
   (j) California physicians and other prescribers could benefit from
a reliable central repository of information about prescription drug
safety and effectiveness.
   (k) Various nationally respected sources of clinical information
are available as sources for a central respository of information
about prescription drug safety and effectiveness.
   (l) Safer and more effective prescription drugs within a class may
also be among the less expensive prescription drugs within that
class, meaning that a reliable central repository of information
about prescription drug safety and effectiveness would create
opportunities for prescription drug cost savings.
  SEC. 2.  Article 7 (commencing with Section 111657) is added to
Chapter 6 of Part 5 of Division 104 of the Health and Safety Code, to
read:

      Article 7.  Drug Safety and Effectiveness Program


   111657.  (a) The State Department of Public Health shall make
every effort to enter into a contract or agreement with the
University of California to establish a program to evaluate
scientific literature that the University of California, if it enters
into the agreement or contract with the department, determines
relevant to the safety and effectiveness of prescription drugs in the
state.
   (b) The program shall have all of the following components:
   (1) A determination of the classes of prescription drugs that are
advertised to consumers, marketed to physicians, or both, in the
state.
   (2) (A) An Internet Web site that will report information on the
safety and effectiveness of brand name and generic drugs in the
classes that are identified pursuant to paragraph (1), including,
when available, direct comparisons of relative safety and
effectiveness, and differential safety and effectiveness of specific
drugs according to age, gender, race, or ethnicity.
   (B) This Web site shall be designed to disseminate information to
health care professionals and consumers in the state, and may include
links to other relevant Web-based information, if that information
has been reviewed and approved by the University of California. The
Internet Web site shall include the following statement: "Many
factors enter into selecting the proper drug for individual patients,
and different patients may respond differently to medications. The
information in those reports aims to promote dialogue and responsible
consumer choice. Before changing any medication, a patient should
consult with his or her treating physician or other prescriber." The
statement may be supplemented by any other advisory statements, as
are deemed appropriate by the University of California.
   (C) The Web site design shall ensure that the dissemination of
information is done in a culturally competent manner. The information
disseminated shall address the differential impact of medications
within a class based on gender, age, race and ethnicity, and other
factors when that information becomes available. Where studies are
relied upon, the demographics of the individuals studied shall be
included in the information disseminated. 
   (3) (A) A prescription education service to provide health care
professionals who are licensed to prescribe or dispense prescription
drugs with information and education on the comparative efficacy,
safety, and cost-effectiveness of commonly used prescription drugs
and on the use of the Internet Web site established pursuant to
paragraph (2).  
   (B) The prescription education service shall conduct in-person
outreach and education sessions with health care professionals in
their place of work. The sessions shall be facilitated by qualified
and appropriately trained clinician educators and shall be conducted
on a one-to-one basis, whenever practicable. This service shall be
made available until January 1, 2015, as a pilot project in Contra
Costa County to health care professionals who participate in,
contract with, or are reimbursed by, state-funded health care
programs. The department shall determine a second county in which the
prescription education service shall be established until January 1,
2015.  
   (C) The department shall adopt regulations that establish all of
the following:  
   (i) Minimum clinical and educational qualifications for prescriber
and dispenser educators employed by or under contract with the
service.  
   (ii) Required training for educators.  
   (iii) A code of conduct that governs the behavior of educators in
their interactions with health care professionals and that
establishes conflict of interest guidelines for educators and others
involved in advising, developing, and administering the service.

   (c) In implementing this article, any contract or agreement
between the department and the University of California entered into
pursuant to this section shall rely on the best scientific
information that is available, as determined by the University of
California, in consultation with the clinical advisory panel, giving
due consideration to the diversity of the population of the State of
California. When compiling evidence, any contract or agreement
between the department and the University of California entered into
pursuant to this section shall do all of the following:
   (1) Employ a methodology that is transparent, publicly available,
and open and responsive to public comment.
   (2) Fully disclose its methodology, findings, and limitations.
   (3) Acknowledge that no conclusion can be drawn about
effectiveness if sufficient evidence is not available.
   (4) Have the evidence reviewed by specialists qualified to review
medical literature.
   (5) Consider good quality peer-reviewed clinical trials and
observational studies that provide research evidence on the
comparative effectiveness, safety, and effect on subpopulations of
prescription drugs, and good quality studies that link patient
adherence, compliance, and tolerance and alternatives to drug
therapy, such as surgery, diet, and exercise, to improved health
outcomes.
   (6) Consider good quality peer-reviewed research evidence that
documents variations among individuals of differing age, gender,
race, and ethnic subpopulations, the effect of comorbidities and
co-occurring disorders, and different patient outcomes based on
adherence, compliance, and tolerance.
   (7) Report any identified gaps in research and opportunities to
improve on currently available research.
   (8) Provide a 30-day comment period during which the public,
including manufacturers, providers, and payers, can provide feedback,
including additional information and studies that might have been
overlooked. The 30-day comment period shall be followed by a revision
period before the posting of any final reviews on the Internet Web
site.
   (d) Any contract or agreement entered into between the department
and the University of California pursuant to this section shall
require the establishment of a clinical advisory panel that includes
physician specialists in the drug class being reviewed, physicians
and pharmacists serving diverse communities, and patient advocates,
including representatives of voluntary health organizations, and
senior citizen organizations to serve as advisers to the program at
various stages in the process of compiling and disseminating
information.
   (e) The program created by this article shall not include an
evaluation of any drug that is used primarily to treat mental
illness, except that, where the drug has other therapeutic
indications, an evaluation of the drug's safety and efficacy may be
performed in relation to those other therapeutic indications.
   (f) In implementing this article, the Legislature requests that
the University of California consider obtaining the assistance of
other research universities and medical research centers in the
state.
   (g) It is the intent of the Legislature that the information
posted on the program's Internet Web site be used to assist
prescribers and patients in choosing the most appropriate therapy for
each patient, and that the information not be used to exclude,
restrict, or limit coverage and reimbursement for a medication
recommended by a patient's prescriber.
   (h)  Any contract or agreement entered into between the department
and the University of California pursuant to this section shall
require that the University of California begin reporting on the
safety and effectiveness of prescription drugs pursuant to this
article on a date certain specified in the contract between the
department and the University of California. It is the intent of the
Legislature that this reporting begin as soon as it is feasible to do
so.
   (i) In order to avoid conflicts of interest, any contract or
agreement entered into between the department and the University of
California pursuant to this section shall require that the University
of California develop and implement conflict-of-interest policies to
prohibit a person from participating in the implementation or
operation of the program's evaluation of a given class of
prescription drugs when he or she knows or has reason to know that he
or she has a material financial or other interest, including, but
not limited to, a person who has a consulting or other agreement with
an organization, that would be affected by the program's evaluation
of that given class of prescription drugs. The contract shall require
that these conflict-of-interest policies be consistent with, and as
rigorous as, the policies utilized by the California Health Benefits
Review Program pursuant to Section 127663. 
   SEC. 3. (j) The department shall, by December 1, 2011, and every
year thereafter, until December 1, 2015, present to the Assembly
Committee on Health and the Senate Committee on Health a report on
the development of the prescription education service established
pursuant to this section. 
   111657.1.  (a) In order to effectively support the department and
the University of California in implementing this article, there is
hereby imposed, pursuant to this section, a fee on manufacturers of
drugs sold in the state. The amount of the fee shall be determined by
the department, in consultation with the University of California,
and shall be limited to the amount necessary to fund the actual and
necessary expenses of the university, the department, and the State
Board of Equalization in implementing this article. The total annual
assessment on drug manufacturers shall not exceed three million five
hundred thousand dollars ($3,500,000).
   (b) (1) The specific fee to be assessed on a drug manufacturer
shall be established by the department, to the maximum extent
practicable, on the basis of a drug manufacturer's market share of
the total amount of prescription drugs sold in the state, based on
the total dispensed retail dollar amount in the year prior to the
assessment.
   (2) A fee shall not be assessed on a drug manufacturer that can
demonstrate, as determined by the department, that it does not
manufacture drugs that are advertised to consumers or marketed to
physicians in the state.
   (c) The fee shall be assessed and collected annually by the State
Board of Equalization.
   (1) For purposes of this section, the State Board of Equalization
shall collect the drug manufacturer fee in accordance with the Fee
Collection Procedures Law (Part 20 (commencing with Section 55001) of
Division 2 of the Revenue and Taxation Code). The State Board of
Equalization may prescribe, adopt, and enforce regulations to carry
out this article, including, but not limited to, provisions governing
collections, reporting, refunds, and appeals.
   (2) The department shall provide to the State Board of
Equalization the name and address of each person or entity who is
liable for a fee or expense, the amount of the fee, and date the fee
is due.
   (3) No petition for redetermination of fees determined by the
department pursuant to this section shall be considered by the State
Board of Equalization if the petition is founded upon the grounds
that the department has improperly or erroneously calculated the
amount of the fee or has incorrectly determined that the person is
subject to the fee. Any appeal of a determination based on the
grounds that the amount of the fee was improperly or erroneously
calculated or that the person is not responsible for the fee shall be
accepted by the State Board of Equalization and forwarded to the
department for consideration and decision.
   (4) No claim for the refund of fees paid pursuant to this section
shall be considered by the State Board of Equalization if the claim
is founded upon the grounds that the department has improperly or
erroneously calculated the amount of the fee or has incorrectly
determined that the person is subject to the fee. Any claim for
refund based on the grounds that the amount of the fee was improperly
or erroneously calculated or that the person is not responsible for
the fee shall be accepted by the State Board of Equalization and
forwarded to the department for consideration and decision.
   (d) The fees collected shall be deposited into the Drug Safety and
Effectiveness Fund, which is hereby established in the State
Treasury. Moneys in the fund shall be expended, upon appropriation by
the Legislature, for the purposes of this article, including, but
not limited to, paying refunds of the manufacturer drug fee imposed
pursuant to this section, and to reimbursing administrative costs of
the State Board of Equalization for collection of the fee. All
interest earned on the moneys that have been deposited into the Drug
Safety and Effectiveness Fund shall be retained in the fund.
   (e) The fees collected pursuant to this section and the earnings
therefrom shall be used solely for the purposes of implementing this
article. The department shall not establish fees pursuant to this
section in excess of the amount reasonably anticipated by the
University of California and the department, and the State Board of
Equalization to fully implement this article.
   (f) This section shall not be implemented until the department and
the University of California enter into a contract or agreement
pursuant to Section 111657. The department shall notify the State
Board of Equalization when this contract or agreement has been
entered into. The State Board of Equalization may delay collection of
the first payment of the fee imposed by this section until seven and
one-half months after the date that the department and the
University of California enter into a contract or agreement pursuant
to Section 111657.