Sec. 17. As a condition for receiving and retaining a wholesale drug distributor license issued under this chapter, an applicant must satisfy the board that the applicant has and will continuously maintain the following:
(1) Acceptable storage and handling conditions and facilities standards for each facility at which legend drugs are received, stored, warehoused, handled, held, offered, marketed, or displayed, or from which legend drugs are transported, including:
(A) suitable construction of the facility and appropriate monitoring equipment to ensure that legend drugs in the facility are maintained in accordance with labeling or in compliance with official compendium standards;
(B) suitable size and construction to facilitate cleaning, maintenance, and proper wholesale distribution operations;
(C) adequate storage areas to provide appropriate lighting, ventilation, temperature, sanitation, humidity, space, equipment, and security conditions;
(D) a quarantine area for separate storage of legend drugs that are outdated, damaged, deteriorated, misbranded, adulterated, counterfeit, suspected counterfeit, otherwise unfit for distribution, or contained in immediate or sealed secondary containers that have been opened;
(E) maintenance of the facility in a clean and orderly condition;
(F) maintenance of the facility in a commercial, nonresidential building; and
(G) freedom of the facility from infestation.
(2) Security of each facility from unauthorized entry as follows:
(A) Entry into areas where legend drugs are held is limited to authorized personnel.
(B) Each facility is equipped with a security system that includes:
(i) an after hours central alarm or a comparable entry detection capability;
(ii) restricted premises access;
(iii) adequate outside perimeter lighting;
(iv) safeguards against theft and diversion, including employee theft and theft or diversion facilitated or hidden by tampering with computers or electronic records; and
(v) a means of protecting the integrity and confidentiality of data and documents and of making the data and documents readily available to the board and other state and federal law enforcement officials.
(3) A reasonable system of record keeping as follows:
(A) The system describes all the wholesale distributor's activities governed by this chapter for the three (3) year period after the disposition of each product, and all records are maintained for at least three (3) years after disposition of the legend drug to which the record applies.
(B) The system is reasonably accessible as determined by board rules in any inspection authorized by the board.
(C) The system provides a means to establish and maintain inventories and records of transactions regarding the receipt and distribution or other disposition of all legend drugs, including the following:
(i) For legend drugs manufactured by a manufacturer for which the wholesale drug distributor is an authorized distributor, a pedigree for each distributed legend drug that leaves the normal distribution chain of custody, as determined by rules adopted by the board.
(ii) For legend drugs manufactured by a manufacturer for which the wholesale drug distributor is not an authorized distributor, a pedigree for each distributed legend drug that leaves the normal chain of custody.
(iii) After January 1, 2007, and after consulting with the federal Food and Drug Administration, at the board's discretion, for each legend drug received and distributed by the wholesale drug distributor, an electronic pedigree developed in accordance with standards and requirements of the board to authenticate, track, and trace legend drugs. The standards and requirements of the board may indicate the information required to be part of the electronic pedigree.
(iv) Dates of receipt and distribution or other disposition of the legend drugs by the wholesale drug distributor.
(v) Availability for inspection and photocopying by any authorized official of a local, state, or federal governmental agency for three (3) years after the creation date of the inventories and records.
(D) Onsite electronic inventories and records are immediately available for inspection, and records kept at a central location apart from the inspection site and not electronically retrievable are available for inspection within two (2) working days after a request by an authorized official of a local, state, or federal governmental agency.
(E) The system maintains an ongoing list of persons with whom the wholesale drug distributor does business.
(F) The system provides for reporting counterfeit or suspected counterfeit legend drugs or counterfeiting or suspected counterfeiting activities to the board and the federal Food and Drug Administration.
(G) The system provides for mandatory reporting of significant shortages or losses of legend drugs to the board and the federal Food and Drug Administration, if applicable, if diversion is known or suspected.
(4) Written policies and procedures to which the wholesale drug distributor adheres for the receipt, security, storage, inventory, transport, shipping, and distribution of legend drugs, and that assure reasonable wholesale distributor preparation for, protection against, and handling of any facility security or operation problems, including the following:
(A) Facility security or operation problems caused by natural disaster or government emergency.
(B) Correction of inventory inaccuracies.
(C) Product shipping and receiving problems.
(D) Quarantine and return to the manufacturer or destruction in accordance with state and federal law of all outdated products and outdated or expired legend drugs, including appropriate documentation and witnessing.
(E) Appropriate disposition of returned goods.
(F) Product recalls.
(G) Identifying, recording, and reporting losses or thefts.
(H) Recalls and withdrawals of legend drugs due to:
(i) an action initiated by the federal Food and Drug Administration or another federal, state, or local governmental agency;
(ii) a volunteer action by the manufacturer to remove defective or potentially defective legend drugs from the market; or
(iii) an action undertaken to promote public health and safety by replacing existing merchandise with an improved product or a new package design.
(I) Disposition and destruction of containers, labels, and packaging to ensure that the containers, labels, and packaging are not used in counterfeiting activities, including necessary documentation and witnessing in accordance with state and federal law.
(J) Investigation of discrepancies in the inventory involving counterfeit, suspected counterfeit, contraband, or suspected contraband legend drugs and reporting of discrepancies within three (3) business days to the board and any other appropriate state or federal governmental agency.
(K) Reporting of criminal or suspected criminal activities involving the inventory of legend drugs to the board within three (3) business days.
(L) Conducting for cause authentication as required under sections 17.2 and 17.8 of this chapter.
(5) Written policies and procedures and sufficient inspection procedures for all incoming and outgoing product shipments, including the following:
(A) Upon receipt, visual examination of each shipping container in a manner adequate to identify the legend drugs in the container and to determine whether the legend drugs may be outdated, adulterated, misbranded, contaminated, contraband, counterfeit, suspected counterfeit, damaged, or otherwise unfit for distribution.
(B) Upon receipt, review of records by the wholesale drug distributor for the acquisition of legend drugs for accuracy and completeness, considering the:
(i) total facts and circumstances surrounding each transaction involving the legend drugs; and
(ii) wholesale drug distributors involved.
(C) Quarantine of a legend drug considered to be outdated, adulterated, misbranded, contaminated, contraband, counterfeit, suspected counterfeit, damaged, or otherwise unfit for distribution until:
(i) examination and a determination that the legend drug is not outdated, adulterated, misbranded, contaminated, contraband, counterfeit, damaged, or otherwise unfit for distribution; or
(ii) the legend drug is destroyed or returned to the manufacturer or wholesale drug distributor from which the legend drug was acquired.
(D) Written policies and procedures to ensure that if the wholesale drug distributor determines that a legend drug is adulterated, misbranded, counterfeit, or suspected counterfeit, the wholesale drug distributor provides notice of the adulteration, misbranding, counterfeiting, or suspected counterfeiting to the board, the federal Food and Drug Administration, and the manufacturer or wholesale drug distributor from which the legend drug was acquired within three (3) business days.
(E) Written policies and procedures to ensure that if the immediate or sealed outer or secondary container or labeling of a legend drug is adulterated, misbranded, counterfeit, or suspected counterfeit, the wholesale drug distributor:
(i) quarantines the legend drug until the legend drug is destroyed or returned to the manufacturer or wholesale drug distributor from which the legend drug was acquired; and
(ii) provides notice of the adulteration, misbranding, counterfeiting, or suspected counterfeiting to the board, the federal Food and Drug Administration, and the manufacturer or wholesale drug distributor from which the legend drug was acquired within three (3) business days.
(F) Written policies and procedures to ensure that a legend drug that has been opened or used, but is not adulterated, misbranded, counterfeit, or suspected counterfeit, is identified as such and quarantined until the legend drug is destroyed or returned to the manufacturer or wholesale drug distributor from which the legend drug was acquired.
(G) Written policies and procedures to ensure that:
(i) a legend drug that will be returned to a manufacturer or wholesale drug distributor is kept under proper conditions for storage, handling, transport, and shipment before the return; and
(ii) documentation showing that proper conditions were maintained is provided to the manufacturer or wholesale drug distributor to which the legend drug is returned.
(H) Inspection of each outgoing shipment for identity of the legend drugs and to ensure that the legend drugs have not been damaged in storage or held under improper conditions.
(I) Written policies and procedures to ensure that if conditions under which a legend drug has been returned to the wholesale drug distributor cast doubt on the legend drug's safety, identity, strength, quality, or purity, the legend drug is destroyed or returned to the manufacturer or wholesale drug distributor from which the legend drug was acquired unless examination, testing, or other investigation proves that the legend drug meets appropriate standards of safety, identity, strength, quality, and purity. In determining whether the conditions under which a legend drug has been returned cast doubt on the legend drug's safety, identity, strength, quality, or purity, the wholesale drug distributor considers the conditions under which the legend drug has been held, stored, or shipped before or during the legend drug's return and the condition of the legend drug and the legend drug's container, carton, or labeling upon receipt of the returned legend drug.
(J) Written policies and procedures to ensure that contraband, counterfeit, or suspected counterfeit legend drugs, other evidence of criminal activity, and accompanying documentation are retained until a disposition is authorized by the board and the federal Food and Drug Administration.
(K) Written policies and procedures to ensure that any shipping, immediate, or sealed outer or secondary container or labeling, and accompanying documentation, suspected of or determined to be counterfeit or fraudulent, are retained until a disposition is authorized by the board and the federal Food and Drug Administration.
(6) Operations in compliance with all federal legal requirements applicable to wholesale drug distribution.
(7) Written policies and procedures to provide for the secure and confidential storage of information with restricted access and to protect the integrity and confidentiality of the information.
(8) A pedigree as required under this chapter, including an electronic pedigree developed in accordance with standards and requirements of the board under subdivision (3)(C)(iii).
(9) Appropriate inventory management and control systems to:
(A) prevent; and
(B) allow detection and documentation of;
theft, counterfeiting, or diversion of legend drugs.
(10) If the wholesale drug distributor is involved in the distribution of controlled substances, registration with the federal Drug Enforcement Administration and the board and compliance with all laws related to the storage, handling, transport, shipment, and distribution of controlled substances.
(11) Isolation of controlled substances from noncontrolled substances and storage of the controlled substances in a secure area in accordance with federal Drug Enforcement Administration security requirements and standards.
(12) Technology and equipment that allow the wholesale drug distributor to authenticate, track, and trace legend drugs. The technology and equipment meet standards set by the board and are used as required by the board to conduct for cause and random tracking, tracing, and authentication of legend drugs.
(13) Employment, training, and documentation of the training concerning the proper use of the technology and equipment required under subdivision (12).
(14) Packaging operations in accordance with an official compendium allowing the identification of a compromise in the integrity of the legend drugs due to tampering or adverse storage conditions.
As added by P.L.182-1991, SEC.3. Amended by P.L.212-2005, SEC.53; P.L.98-2006, SEC.20.
