HB 9-PHARMA BD & EMPLOYEES;DRUG DIST/MANUFAC  3:52:37 PM CHAIR KITO announced that the first order of business would be HOUSE BILL No. 9, "An Act relating to the Board of Pharmacy; relating to the licensing and inspection of certain facilities located outside the state; relating to drug supply chain security; and creating a position of executive administrator for the Board of Pharmacy." [Before the committee was the proposed committee substitute (CS) for HB 9, Version 30-LS0131\J, Bruce, 4/6/17, adopted on 4/7/17 as the working document.] CHAIR KITO opened the hearing with the continuation of invited testimony. 3:53:28 PM RICHARD HOLT, PharmD, Vice Chair, Board of Pharmacy, testified in support of HB 9. He said the Board of Pharmacy is requesting the authority to license and write regulations around that statute to have the ability to oversee the pharmacy supply chain of medication coming into Alaska. It is not uncommon for other states to have similar legislation for the safety of their patients, he pointed out. Only Alaska, Hawaii, Guam, Utah, and Massachusetts don't have the ability to license these wholesale distributors. The Board of Pharmacy is asking for the licensing opportunity to take care of patients in Alaska and maintain their safety. DR. HOLT stated that the proposed executive administrator position is really needed to assist the Board of Pharmacy in all the regulations that the board is currently working on. He noted that pharmacy continues to evolve very rapidly to things that are being seen elsewhere in the country, but which haven't begun to be touched upon in Alaska, which really impacts patient safety. This legislation is very important to achieve, he said. 3:55:19 PM REPRESENTATIVE KNOPP inquired whether he is correct in his understanding that Alaska, Guam, and Hawaii have not set up inspection programs. DR. HOLT replied that the information he has from the National Association of Boards of Pharmacy is that the last remaining areas that have not [set up inspection programs] are Alaska, Hawaii, Guam, Utah, and Massachusetts. He said he has been informed that those other areas are actively working on legislation, but the legislation is not finalized. REPRESENTATIVE KNOPP stated it is a good bill in concept and he is not opposed to it. However, he continued, he is reluctant to create a position in the current fiscal climate because he is not big on growing government. He asked why [the Board of Pharmacy] doesn't think Alaska is adequately protected if [other states] have an inspection process and verification of the supply chain. DR. HOLT responded that [the Board of Pharmacy] currently has statutory authority to register out-of-state pharmacies and part of that is reviewing out-of-state inspections. Some of the inspections he has seen coming in from other states, he advised, show him great cause to be alarmed. Some of them have little to no detail at all, yet [the board] accepts them in that circumstance. He noted that with professionals in this field, licensed pharmacists, and two public members, [the board] feels that it is its profession to protect the patients in Alaska, so having the authority to do inspections is important. DR. HOLT further advised that it must be kept in mind that even if a facility has a great inspection and meets the adequacies that [the Board of Pharmacy] would write regulations to, if something happens [the board] still doesn't have the authority over that wholesale distributor or other facility if there is not this piece of legislation. He explained that if the wholesaler shipped a drug and something happened to the patients in Alaska, [the board] could not reprimand that facility because the facility is out of the board's jurisdiction. 3:58:18 PM REPRESENTATIVE WOOL noted that Massachusetts doesn't have a law like this and it has a strong medical community. He inquired why Massachusetts doesn't have a law like this. DR. HOLT answered he doesn't know the current status, but he has been told Massachusetts is working on this in light of the 2012 compounding situation in which the New England Compounding Center was an unlicensed manufacturer of steroid medications. Based on whether the medication was mislabeled or from unsanitary contamination, the result was 64 people dying and 800 people sick with fungal meningitis from what this center shipped across the country. REPRESENTATIVE WOOL offered his understanding that HB 9 is trying to solve a few problems, one of them being bad actors and unclean conditions in compounding facilities, and the other being pharmacists approached by midlevel distributors that are often cheaper but without a way of knowing the source and perhaps the medication being counterfeit. He recalled it was the sourcing of the medication that was in question and not so much the process. He said he shares Representative Knopp's concern about having to hire someone to do more digging around to verify these licenses. He asked whether it is possible to avoid midlevel distributors and go with certified big pharmaceutical distributors. DR. HOLT replied that in his capacity with his retailer he doesn't purchase directly. But, he advised, that would limit the sources and options for the patients receiving those medications, as well as impacting the economical side of a business. The intention is not to limit business, but rather to make sure that the sources of these compounded medications, the wholesale distributors, and so forth are licensed. Whether it is a clinic, hospital, or retail pharmacy, there is comfort in knowing something about that business, he said. Right now [the board] doesn't license them and it is unknown where things are coming from, nothing has been looked at. He pointed out that under HB 9 the executive administrator (EA) position would be paid from the fees from these three licensing categories, not just from wholesale distributors. 4:02:50 PM CHAIR KITO closed public testimony on HB 9 after ascertaining no one else wished to testify. 4:03:17 PM REPRESENTATIVE JOSEPHSON commented he thinks HB 9 is a fine bill and is a quintessential example of how the public doesn't understand all the things that the State of Alaska does. The bill, he continued, is a textbook example of what government must do. 4:03:47 PM REPRESENTATIVE WOOL moved to report CSHB 9, Version 30-LS0131\J, Bruce, 4/6/17, out of committee with individual recommendations and the accompanying fiscal notes. There being no objection, CSHB 9(L&C) was reported from the House Labor and Commerce Standing Committee.