Bill Text: TX HB3496 | 2019-2020 | 86th Legislature | Enrolled


Bill Title: Relating to the licensing and regulation of certain pharmacies; providing an administrative penalty.

Spectrum: Partisan Bill (Republican 4-0)

Status: (Passed) 2019-06-10 - Effective on 1/1/20 [HB3496 Detail]

Download: Texas-2019-HB3496-Enrolled.html
 
 
  H.B. No. 3496
 
 
 
 
AN ACT
  relating to the licensing and regulation of certain pharmacies;
  providing an administrative penalty.
         BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
         SECTION 1.  Section 560.052(b), Occupations Code, is amended
  to read as follows:
         (b)  To qualify for a pharmacy license, an applicant must
  submit to the board:
               (1)  a license fee set by the board, except as provided
  by Subsection (d); [and]
               (2)  a completed application that:
                     (A)  is on a form prescribed by the board;
                     (B)  includes notice that a surety bond may be
  required under Section 565.0551;
                     (C)  is given under oath;
                     (D) [(C)]  includes proof that:
                           (i)  a pharmacy license held by the
  applicant in this state or another state, if applicable, has not
  been restricted, suspended, revoked, or surrendered for any reason;
  and
                           (ii)  no owner of the pharmacy for which the
  application is made has held a pharmacist license in this state or
  another state, if applicable, that has been restricted, suspended,
  revoked, or surrendered for any reason; and
                     (E) [(D)]  includes a statement of:
                           (i)  the ownership;
                           (ii)  the location of the pharmacy;
                           (iii)  the license number of each pharmacist
  who is employed by the pharmacy, if the pharmacy is located in this
  state, or who is licensed to practice pharmacy in this state, if the
  pharmacy is located in another state;
                           (iv)  the pharmacist license number of the
  pharmacist-in-charge; and
                           (v)  any other information the board
  determines necessary; and
               (3)  a disclosure statement required under Section
  560.0521, unless:
                     (A)  the pharmacy for which the application is
  made is operated by a publicly traded company;
                     (B)  the pharmacy for which the application is
  made is wholly owned by a retail grocery store chain; or
                     (C)  the applicant is applying for a Class B or
  Class C pharmacy license.
         SECTION 2.  Subchapter B, Chapter 560, Occupations Code, is
  amended by adding Section 560.0521 to read as follows:
         Sec. 560.0521.  SWORN DISCLOSURE STATEMENT. (a) A
  disclosure statement included with an application under Section
  560.052(b)(3) must include:
               (1)  the name of the pharmacy;
               (2)  the name of each person who has a direct financial
  investment in the pharmacy;
               (3)  the name of each person who:
                     (A)  is not an individual;
                     (B)  has any financial investment in the pharmacy;
  and
                     (C)  is not otherwise disclosed under Subdivision
  (2);
               (4)  the total amount or percentage of the financial
  investment made by each person described by Subdivision (2); and
               (5)  the name of each of the following persons, if
  applicable, connected to the pharmacy if the person is not
  otherwise disclosed under Subdivision (2) or (3):
                     (A)  a partner;
                     (B)  an officer;
                     (C)  a director;
                     (D)  a managing employee;
                     (E)  an owner or person who controls the owner;
  and
                     (F)  a person who acts as a controlling person of
  the pharmacy through the exercise of direct or indirect influence
  or control over the management of the pharmacy, the expenditure of
  money by the pharmacy, or a policy of the pharmacy, including:
                           (i)  a management company, landlord,
  marketing company, or similar person who operates or contracts for
  the operation of a pharmacy and, if the pharmacy is a publicly
  traded corporation or is controlled by a publicly traded
  corporation, an officer or director of the corporation but not a
  shareholder or lender of the corporation;
                           (ii)  an individual who has a personal,
  familial, or other relationship with an owner, manager, landlord,
  tenant, or provider of a pharmacy that allows the individual to
  exercise actual control of the pharmacy; and
                           (iii)  any other person the board by rule
  requires to be included based on the person's exercise of direct or
  indirect influence or control.
         (b)  An applicant shall notify the board not later than the
  60th day after the date any administrative sanction or criminal
  penalty is imposed against a person described by Subsection (a).
         (c)  The board may adopt rules regarding the disclosure of
  the source of a financial investment under Subsection (a).
         (d)  A disclosure statement under this section shall be given
  under oath as prescribed by board rule.
         (e)  Information contained in a disclosure statement under
  this section is confidential and not subject to disclosure under
  Chapter 552, Government Code.
         SECTION 3.  Section 565.002(a), Occupations Code, is amended
  to read as follows:
         (a)  The board may discipline an applicant for or the holder
  of a pharmacy license, including a Class E pharmacy license subject
  to Section 565.003, if the board finds that the applicant or license
  holder has:
               (1)  been convicted of or placed on deferred
  adjudication community supervision or deferred disposition or the
  applicable federal equivalent for:
                     (A)  a misdemeanor:
                           (i)  involving moral turpitude; or
                           (ii)  under Chapter 481 or 483, Health and
  Safety Code, or the Comprehensive Drug Abuse Prevention and Control
  Act of 1970 (21 U.S.C. Section 801 et seq.); or
                     (B)  a felony;
               (2)  advertised a prescription drug or device in a
  deceitful, misleading, or fraudulent manner;
               (3)  violated any provision of this subtitle or any
  rule adopted under this subtitle or that an owner or employee of a
  pharmacy has violated any provision of this subtitle or any rule
  adopted under this subtitle;
               (4)  sold without legal authorization a prescription
  drug or device to a person other than:
                     (A)  a pharmacy licensed by the board;
                     (B)  a practitioner;
                     (C)  a person who procures a prescription drug or
  device for lawful research, teaching, or testing, and not for
  resale;
                     (D)  a manufacturer or wholesaler licensed by the
  commissioner of public health as required by Chapter 431, Health
  and Safety Code; or
                     (E)  a carrier or warehouseman;
               (5)  allowed an employee who is not a pharmacist to
  practice pharmacy;
               (6)  sold an adulterated or misbranded prescription or
  nonprescription drug;
               (7)  failed to engage in or ceased to engage in the
  business described in the application for a license;
               (8)  failed to maintain records as required by this
  subtitle, Chapter 481 or 483, Health and Safety Code, the
  Comprehensive Drug Abuse Prevention and Control Act of 1970 (21
  U.S.C. Section 801 et seq.), or any rule adopted under this subtitle
  or Chapter 483, Health and Safety Code;
               (9)  failed to establish and maintain effective
  controls against diversion of prescription drugs into other than a
  legitimate medical, scientific, or industrial channel as provided
  by this subtitle, another state statute or rule, or a federal
  statute or rule;
               (10)  engaged in fraud, deceit, or misrepresentation as
  defined by board rule in:
                     (A)  operating a pharmacy;
                     (B)  [or in] applying for a license to operate a
  pharmacy; or
                     (C)  dispensing drugs for nontherapeutic
  purposes;
               (11)  violated a disciplinary order;
               (12)  been responsible for a drug audit shortage;
               (13)  been disciplined by the regulatory board of
  another state for conduct substantially equivalent to conduct
  described under this subsection; or
               (14)  waived, discounted, or reduced, or offered to
  waive, discount, or reduce, a patient copayment or deductible for a
  compounded drug in the absence of:
                     (A)  a legitimate, documented financial hardship
  of the patient; or
                     (B)  evidence of a good faith effort to collect
  the copayment or deductible from the patient.
         SECTION 4.  Subchapter B, Chapter 565, Occupations Code, is
  amended by adding Sections 565.0551 and 565.0591 to read as
  follows:
         Sec. 565.0551.  SURETY BOND. (a) The executive director of
  the board may require a license holder to submit a surety bond to
  the board in an amount as prescribed by board rule, not to exceed
  $25,000.
         (b)  The board may use a pharmacy's surety bond to secure the
  payment of a fine, fee, or penalty imposed on the pharmacy or costs
  incurred by the board in conducting an investigation of the
  pharmacy only under Section 565.002(a)(7) or (10) if the pharmacy
  fails to pay the fine, fee, penalty, or cost as prescribed by board
  rule.
         Sec. 565.0591.  REVOCATION OF PHARMACY LICENSE FOR FAILURE
  TO OPERATE. (a) On discovery by the board that a pharmacy licensed
  under Chapter 560 has ceased to operate for a period of 30 days or
  longer, the board shall notify the pharmacy that the license will be
  revoked.
         (b)  The notice must:
               (1)  include a statement that the pharmacy license is
  being revoked for violation of Section 565.002(a)(7); and
               (2)  inform the license holder of the license holder's
  right to a hearing to contest the revocation.
         (c)  Not later than the 20th day after the date the license
  holder receives the notice of revocation under this section, the
  license holder may submit a written request for a hearing to contest
  the revocation.
         (d)  If the license holder does not request a hearing within
  the period prescribed by Subsection (c), the board shall:
               (1)  enter an order revoking the license; and
               (2)  notify the license holder of the order.
         (e)  If the license holder requests a hearing within the
  period prescribed by Subsection (c), a panel of three board members
  appointed by the president of the board shall conduct the hearing.
  At the hearing the panel shall determine whether the license holder
  has violated Section 565.002(a)(7).
         (f)  If the panel determines that the license holder
  committed the violation, the board shall promptly:
               (1)  enter an order revoking the license; and
               (2)  notify the license holder of the order.
         (g)  Chapter 2001, Government Code, does not apply to a
  determination under Subsection (e).
         SECTION 5.  Section 566.001, Occupations Code, is amended to
  read as follows:
         Sec. 566.001.  IMPOSITION OF PENALTY. The board may impose
  an administrative penalty on:
               (1)  a person licensed or regulated under this subtitle
  who violates this subtitle or a rule or order adopted under this
  subtitle; and
               (2)  an applicant who fails to submit a sworn
  disclosure statement with an application if required by Section
  560.052(b)(3).
         SECTION 6.  The changes in law made by this Act apply only to
  an application for a pharmacy license that is submitted on or after
  the effective date of this Act. An application for a pharmacy
  license that was submitted before the effective date of this Act is
  governed by the law in effect on the date the application was
  submitted, and the former law is continued in effect for that
  purpose.
         SECTION 7.  This Act takes effect January 1, 2020.
 
 
  ______________________________ ______________________________
     President of the Senate Speaker of the House     
 
 
         I certify that H.B. No. 3496 was passed by the House on May 8,
  2019, by the following vote:  Yeas 140, Nays 7, 1 present, not
  voting.
 
  ______________________________
  Chief Clerk of the House   
 
 
         I certify that H.B. No. 3496 was passed by the Senate on May
  22, 2019, by the following vote:  Yeas 30, Nays 1.
 
  ______________________________
  Secretary of the Senate    
  APPROVED:  _____________________
                     Date          
   
            _____________________
                   Governor       
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