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HF 1728

as introduced - 93rd Legislature (2023 - 2024) Posted on 02/15/2023 12:32pm

KEY: stricken = removed, old language.
underscored = added, new language.

Bill Text Versions

Engrossments
Introduction Posted on 02/13/2023

Current Version - as introduced

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A bill for an act
relating to health; increasing application and renewal fees for opiate drug
wholesalers; establishing an opiate product fee for certain opiate drug wholesalers;
eliminating the sunset for opioid fees; amending Minnesota Statutes 2022, sections
151.065, subdivisions 1, 3, 7; 151.066, subdivisions 3, 4; 151.47, subdivision 1a;
256.043, subdivision 1; repealing Minnesota Statutes 2022, section 256.043,
subdivision 4.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2022, section 151.065, subdivision 1, is amended to read:


Subdivision 1.

Application fees.

Application fees for licensure and registration are as
follows:

(1) pharmacist licensed by examination, $175;

(2) pharmacist licensed by reciprocity, $275;

(3) pharmacy intern, $50;

(4) pharmacy technician, $50;

(5) pharmacy, $260;

(6) drug wholesaler, new text begin nonopiate new text end legend drugs only, $5,260;

(7) drug wholesaler, new text begin nonopiate new text end legend and nonlegend drugs, $5,260;

(8) drug wholesaler, nonlegend drugs, veterinary legend drugs, or both, $5,260;

(9) drug wholesaler, medical gases, $5,260 for the first facility and $260 for each
additional facility;

(10) third-party logistics provider, $260;

(11) drug manufacturer, nonopiate legend drugs only, $5,260;

(12) drug manufacturer, nonopiate legend and nonlegend drugs, $5,260;

(13) drug manufacturer, nonlegend or veterinary legend drugs, $5,260;

(14) drug manufacturer, medical gases, $5,260 for the first facility and $260 for each
additional facility;

(15) drug manufacturer, also licensed as a pharmacy in Minnesota, $5,260;

(16) drug manufacturer of opiate-containing controlled substances listed in section
152.02, subdivisions 3 to 5, $55,260;

(17) medical gas dispenser, $260;

(18) controlled substance researcher, $75; deleted text begin and
deleted text end

(19) pharmacy professional corporation, $150deleted text begin .deleted text end new text begin ; and
new text end

new text begin (20) drug wholesaler of opiate-containing controlled substances listed in section 152.02,
subdivisions 3 to 5, $55,260.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023, and applies to any license
issued on or after that date.
new text end

Sec. 2.

Minnesota Statutes 2022, section 151.065, subdivision 3, is amended to read:


Subd. 3.

Annual renewal fees.

Annual licensure and registration renewal fees are as
follows:

(1) pharmacist, $175;

(2) pharmacy technician, $50;

(3) pharmacy, $260;

(4) drug wholesaler, new text begin nonopiate new text end legend drugs only, $5,260;

(5) drug wholesaler, new text begin nonopiate new text end legend and nonlegend drugs, $5,260;

(6) drug wholesaler, nonlegend drugs, veterinary legend drugs, or both, $5,260;

(7) drug wholesaler, medical gases, $5,260 for the first facility and $260 for each
additional facility;

(8) third-party logistics provider, $260;

(9) drug manufacturer, nonopiate legend drugs only, $5,260;

(10) drug manufacturer, nonopiate legend and nonlegend drugs, $5,260;

(11) drug manufacturer, nonlegend, veterinary legend drugs, or both, $5,260;

(12) drug manufacturer, medical gases, $5,260 for the first facility and $260 for each
additional facility;

(13) drug manufacturer, also licensed as a pharmacy in Minnesota, $5,260;

(14) drug manufacturer of opiate-containing controlled substances listed in section
152.02, subdivisions 3 to 5, $55,260;

(15) medical gas dispenser, $260;

(16) controlled substance researcher, $75; deleted text begin and
deleted text end

(17) pharmacy professional corporation, $100deleted text begin .deleted text end new text begin ; and
new text end

new text begin (18) drug wholesaler of opiate-containing controlled substances listed in section 152.02,
subdivisions 3 to 5, $55,260.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023, and applies to any license
renewed on or after that date.
new text end

Sec. 3.

Minnesota Statutes 2022, section 151.065, subdivision 7, is amended to read:


Subd. 7.

Deposit of fees.

(a) The license fees collected under this section, with the
exception of the fees identified in paragraphs (b) and (c), shall be deposited in the state
government special revenue fund.

(b) $5,000 of each fee collected under subdivision 1, clauses (6) to (9), and (11) to (15),
and subdivision 3, clauses (4) to (7), and (9) to (13), and $55,000 of each fee collected under
subdivision 1, deleted text begin clausedeleted text end new text begin clausesnew text end (16)new text begin and (20)new text end , and subdivision 3, deleted text begin clausedeleted text end new text begin clausesnew text end (14)new text begin and (18)new text end ,
deleted text begin shalldeleted text end new text begin mustnew text end be deposited in the opiate epidemic response fund established in section 256.043.

deleted text begin (c) If the fees collected under subdivision 1, clause (16), or subdivision 3, clause (14),
are reduced under section 256.043, $5,000 of the reduced fee shall be deposited in the opiate
epidemic response fund in section 256.043.
deleted text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023.
new text end

Sec. 4.

Minnesota Statutes 2022, section 151.066, subdivision 3, is amended to read:


Subd. 3.

Determination of an opiate product registration fee.

(a) The board deleted text begin shalldeleted text end new text begin
must
new text end annually assess an opiate product registration fee on any manufacturer new text begin or wholesaler
new text end of an opiate that annually sells, delivers, or distributes an opiate within or into the state
2,000,000 or more units as reported to the board under subdivision 2.

(b) For purposes of assessing the annual registration fee under this section and
determining the number of opiate units a manufacturer new text begin or wholesaler new text end sold, delivered, or
distributed within or into the state, the board shall not consider any opiate that is used for
substance use disorder treatment with medications for opioid use disorder.

(c) The annual registration fee for each manufacturer new text begin or wholesaler new text end meeting the
requirement under paragraph (a) is $250,000.

(d) In conjunction with the data reported under this section, and notwithstanding section
152.126, subdivision 6, the board may use the data reported under section 152.126,
subdivision 4, to determine which manufacturers new text begin or wholesalers new text end meet the requirement under
paragraph (a) and are required to pay the registration fees under this subdivision.

(e) By April 1 of each year, beginning April 1, 2020, the board deleted text begin shalldeleted text end new text begin mustnew text end notify a
manufacturer new text begin or wholesaler new text end that the manufacturer new text begin or wholesaler new text end meets the requirement in
paragraph (a) and is required to pay the annual registration fee in accordance with section
151.252, subdivision 1, paragraph (b)new text begin , or section 151.47, subdivision 1a, paragraph (q), as
applicable
new text end .

(f) A manufacturer new text begin or wholesaler new text end may dispute the board's determination that the
manufacturer new text begin or wholesaler new text end must pay the registration fee no later than 30 days after the date
of notification. However, the manufacturernew text begin or wholesalernew text end must still remit the fee as required
by section 151.252, subdivision 1, paragraph (b)new text begin , or section 151.47, subdivision 1a, paragraph
(q), as applicable
new text end . The dispute must be filed with the board in the manner and using the
forms specified by the board. A manufacturer new text begin or wholesaler new text end must submit, with the required
forms, data satisfactory to the board that demonstrates that the assessment of the registration
fee was incorrect. The board must make a decision concerning a dispute no later than 60
days after receiving the required dispute forms. If the board determines that the manufacturer
new text begin or wholesaler new text end has satisfactorily demonstrated that the fee was incorrectly assessed, the board
must refund the amount paid in error.

(g) For purposes of this subdivision, a unit means the individual dosage form of the
particular drug product that is prescribed to the patient. One unit equals one tablet, capsule,
patch, syringe, milliliter, or gram.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023.
new text end

Sec. 5.

Minnesota Statutes 2022, section 151.066, subdivision 4, is amended to read:


Subd. 4.

Report.

(a) The Board of Pharmacy deleted text begin shalldeleted text end new text begin mustnew text end evaluate the registration fee on
drug manufacturers new text begin and wholesalers new text end established under this section, and whether the
registration fee and the increased licensure fees have impacted the prescribing practices of
opiates by reducing the number of opiate prescriptions issued during calendar years 2021,
2022, and 2023, or creating any unintended consequences in the availability of opiates for
the treatment of chronic or intractable pain to the extent the board has the ability to effectively
identify a correlation. Notwithstanding section 152.126, subdivision 6, the board may access
the data reported under section 152.126, subdivision 4, to conduct this evaluation.

(b) The board deleted text begin shalldeleted text end new text begin must new text end submit the results of its evaluation to the chairs and ranking
minority members of the legislative committees with jurisdiction over health and human
services policy and finance by March 1, 2024.

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023.
new text end

Sec. 6.

Minnesota Statutes 2022, section 151.47, subdivision 1a, is amended to read:


Subd. 1a.

Licensing.

(a) The board deleted text begin shalldeleted text end new text begin mustnew text end license wholesale distributors in a manner
that is consistent with United States Code, title 21, section 360eee-2, and the regulations
promulgated thereunder. In the event that the provisions of this section, or of the rules of
the board, conflict with the provisions of United States Code, title 21, section 360eee-2, or
the rules promulgated thereunder, the federal provisions deleted text begin shalldeleted text end new text begin mustnew text end prevail. The board shall
not license a person as a wholesale distributor unless the person is engaged in wholesale
distribution.

(b) deleted text begin Nodeleted text end new text begin Anew text end person deleted text begin shalldeleted text end new text begin must notnew text end act as a wholesale distributor without first obtaining a
license from the board and paying any applicable fee specified in section 151.065.

(c) Application for a wholesale distributor license under this section shall be made in a
manner specified by the board.

(d) deleted text begin Nodeleted text end new text begin Anew text end license deleted text begin shalldeleted text end new text begin must notnew text end be issued or renewed for a wholesale distributor unless
the applicant agrees to operate in a manner prescribed by federal and state law and according
to the rules adopted by the board.

(e) deleted text begin Nodeleted text end new text begin Anew text end license deleted text begin maydeleted text end new text begin must notnew text end be issued or renewed for a wholesale distributor facility
that is located in another state unless the applicant supplies the board with proof of licensure
or registration by the state in which the wholesale distributor is physically located or by the
United States Food and Drug Administration.

(f) The board deleted text begin shalldeleted text end new text begin mustnew text end require a separate license for each drug wholesale distributor
facility located within the state and for each drug wholesale distributor facility located
outside of the state from which drugs are shipped into the state or to which drugs are reverse
distributednew text begin , except that a wholesaler of opiate-containing controlled substances must not be
required to pay the fee under section 151.065, subdivision 1, clause (20), or 3, clause (18),
for more than one facility
new text end .

(g) The board deleted text begin shalldeleted text end new text begin mustnew text end not issue an initial or renewed license for a drug wholesale
distributor facility unless the facility passes an inspection conducted by an authorized
representative of the board or is inspected and accredited by an accreditation program
approved by the board. In the case of a drug wholesale distributor facility located outside
of the state, the board may require the applicant to pay the cost of the inspection, in addition
to the license fee in section 151.065, unless the applicant furnishes the board with a report,
issued by the appropriate regulatory agency of the state in which the facility is located, of
an inspection that has occurred within the 24 months immediately preceding receipt of the
license application by the board, or furnishes the board with proof of current accreditation.
The board may deny licensure unless the applicant submits documentation satisfactory to
the board that any deficiencies noted in an inspection report have been corrected.

(h) As a condition for receiving and retaining a wholesale drug distributor license issued
under this section, an applicant deleted text begin shalldeleted text end new text begin mustnew text end satisfy the board that it:

(1) has adequate storage conditions and facilities to allow for the safe receipt, storage,
handling, and sale of drugs;

(2) has minimum liability and other insurance as may be required under any applicable
federal or state law;

(3) has a functioning security system that includes an after-hours central alarm or
comparable entry detection capability, and security policies and procedures that include
provisions for restricted access to the premises, comprehensive employee applicant screening,
and safeguards against all forms of employee theft;

(4) will maintain appropriate records of the distribution of drugs, which deleted text begin shalldeleted text end new text begin mustnew text end be
kept for a minimum of two years and be made available to the board upon request;

(5) employs principals and other persons, including officers, directors, primary
shareholders, and key management executives, who will at all times demonstrate and maintain
their capability of conducting business in conformity with state and federal law, at least one
of whom will serve as the primary designated representative for each licensed facility and
who will be responsible for ensuring that the facility operates in a manner consistent with
state and federal law;

(6) will ensure that all personnel have sufficient education, training, and experience, in
any combination, so that they may perform assigned duties in a manner that maintains the
quality, safety, and security of drugs;

(7) will provide the board with updated information about each wholesale distributor
facility to be licensed, as requested by the board;

(8) will develop and, as necessary, update written policies and procedures that deleted text begin assuredeleted text end new text begin
ensure
new text end reasonable wholesale drug distributor preparation for, protection against, and handling
of any facility security or operation problems, including but not limited to those caused by
natural disaster or government emergency, inventory inaccuracies or drug shipping and
receiving, outdated drugs, appropriate handling of returned goods, and drug recalls;

(9) will have sufficient policies and procedures in place for the inspection of all incoming
and outgoing drug shipments;

(10) will operate in compliance with all state and federal requirements applicable to
wholesale drug distribution; and

(11) will meet the requirements for inspections found in this subdivision.

(i) An agent or employee of any licensed wholesale drug distributor need not seek
licensure under this section. Paragraphs (i) to (p) apply to wholesaler personnel.

(j) The board is authorized to and deleted text begin shalldeleted text end new text begin mustnew text end require fingerprint-based criminal
background checks of facility managers or designated representatives, as required under
United States Code, title 21, section 360eee-2. The criminal background checks deleted text begin shalldeleted text end new text begin mustnew text end
be conducted as provided in section 214.075. The board deleted text begin shalldeleted text end new text begin mustnew text end use the criminal
background check data received to evaluate the qualifications of persons for ownership of
or employment by a licensed wholesaler and deleted text begin shalldeleted text end new text begin mustnew text end not disseminate this data except as
allowed by law.

(k) A licensed wholesaler deleted text begin shalldeleted text end new text begin mustnew text end not be owned by, or employ, a person who has:

(1) been convicted of any felony for conduct relating to wholesale distribution, any
felony violation of United States Code, title 21, section 331, subsection (i) or (k), or any
felony violation of United States Code, title 18, section 1365, relating to product tampering;
or

(2) engaged in a pattern of violating the requirements of United States Code, title 21,
section 360eee-2, or the regulations promulgated thereunder, or state requirements for
licensure, that presents a threat of serious adverse health consequences or death to humans.

(l) An applicant for the issuance or renewal of a wholesale distributor license deleted text begin shalldeleted text end new text begin mustnew text end
execute and file with the board a surety bond.

(m) Prior to issuing or renewing a wholesale distributor license, the board deleted text begin shalldeleted text end new text begin mustnew text end
require an applicant that is not a government owned and operated wholesale distributor to
submit a surety bond of $100,000, except that if the annual gross receipts of the applicant
for the previous tax year is $10,000,000 or less, a surety bond of $25,000 deleted text begin shalldeleted text end new text begin mustnew text end be
required.

(n) If a wholesale distributor can provide evidence satisfactory to the board that it
possesses the required bond in another state, the requirement for a bond deleted text begin shalldeleted text end new text begin mustnew text end be waived.

(o) The purpose of the surety bond required under this subdivision is to secure payment
of any civil penalty imposed by the board pursuant to section 151.071, subdivision 1. The
board may make a claim against the bond if the licensee fails to pay a civil penalty within
30 days after the order imposing the fine or costs become final.

(p) A single surety bond deleted text begin shalldeleted text end new text begin must new text end satisfy the requirement for the submission of a bond
for all licensed wholesale distributor facilities under common ownership.

new text begin (q) In addition to the license required under paragraph (b), each wholesaler required to
pay the registration fee under section 151.066 must pay the fee by June 1 of each year,
beginning June 1, 2024. In the event of a change of ownership of the wholesaler, the new
owner must pay the registration fee specified under section 151.066, subdivision 3, that the
original owner would have been assessed had the original owner retained ownership. The
registration fee collected under this paragraph must be deposited in the opiate epidemic
response fund established under section 256.043.
new text end

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023.
new text end

Sec. 7.

Minnesota Statutes 2022, section 256.043, subdivision 1, is amended to read:


Subdivision 1.

Establishment.

(a) The opiate epidemic response fund is established in
the state treasury. The commissioner of management and budget shall establish within the
opiate epidemic response fund two accounts: (1) a registration and license fee account; and
(2) a settlement account. Beginning in fiscal year 2021, for each fiscal year, the fund shall
be administered according to this section.

(b) The commissioner of management and budget shall deposit into the registration and
license fee account the registration fee assessed by the Board of Pharmacy under section
151.066 and the license fees identified in section 151.065, subdivision 7, deleted text begin paragraphsdeleted text end new text begin
paragraph
new text end (b) deleted text begin and (c)deleted text end .

(c) The commissioner of management and budget shall deposit into the settlement account
any money received by the state resulting from a settlement agreement or an assurance of
discontinuance entered into by the attorney general of the state, or a court order in litigation
brought by the attorney general of the state, on behalf of the state or a state agency, related
to alleged violations of consumer fraud laws in the marketing, sale, or distribution of opioids
in this state or other alleged illegal actions that contributed to the excessive use of opioids,
pursuant to section 16A.151, subdivision 2, paragraph (f).

new text begin EFFECTIVE DATE. new text end

new text begin This section is effective July 1, 2023.
new text end

Sec. 8. new text begin REPEALER; OPIOID FEE SUNSET.
new text end

new text begin Minnesota Statutes 2022, section 256.043, subdivision 4, new text end new text begin is repealed, effective July 1,
2023.
new text end

APPENDIX

Repealed Minnesota Statutes: 23-02731

256.043 OPIATE EPIDEMIC RESPONSE FUND.

Subd. 4.

Settlement; sunset.

(a) If the state receives a total sum of $250,000,000: (1) as a result of a settlement agreement or an assurance of discontinuance entered into by the attorney general of the state or resulting from a court order in litigation brought by the attorney general of the state on behalf of the state or a state agency, related to alleged violations of consumer fraud laws in the marketing, sale, or distribution of opioids in this state, or other alleged illegal actions that contributed to the excessive use of opioids; (2) from the fees collected under sections 151.065, subdivisions 1 and 3, and 151.066, that are deposited into the opiate epidemic response fund established in this section; or (3) from a combination of both, the fees specified in section 151.065, subdivisions 1, clause (16), and 3, clause (14), shall be reduced to $5,260, and the opiate registration fee in section 151.066, subdivision 3, shall be repealed. For purposes of this paragraph, any money received as a result of a settlement agreement specified in this paragraph and directly allocated or distributed and received by either the state or a municipality as defined in section 466.01, subdivision 1, shall be counted toward determining when the $250,000,000 is reached.

(b) The commissioner of management and budget shall inform the Board of Pharmacy, the governor, and the legislature when the amount specified in paragraph (a) has been reached. The board shall apply the reduced license fee for the next licensure period.

(c) Notwithstanding paragraph (a), the reduction of the license fee in section 151.065, subdivisions 1 and 3, and the repeal of the registration fee in section 151.066 shall not occur before July 1, 2031.