S.B. No. 561
                                        AN ACT
    1-1  relating to licensing exemptions for wholesale distribution of
    1-2  prescription drugs.
    1-3        BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
    1-4        SECTION 1.  Subsection (a), Section 431.2021, Health and
    1-5  Safety Code, is amended to read as follows:
    1-6        (a)  A person who engages in wholesale distribution of
    1-7  prescription drugs in this state for use in humans is exempt from
    1-8  this subchapter if the person is exempt under:
    1-9              (1)  the Prescription Drug Marketing Act of 1987, as
   1-10  amended (21 U.S.C. Section 353(c)(3)(B));
   1-11              (2)  the regulations adopted by the secretary to
   1-12  administer and enforce that Act; or
   1-13              (3)  the interpretations of that Act set out in the
   1-14  compliance policy manual of the United States Food and Drug
   1-15  Administration <Persons who engage only in the following types of
   1-16  wholesale drug distribution are exempt from the licensing
   1-17  requirements of this subchapter:>
   1-18              <(1)  intracompany sales;>
   1-19              <(2)  the purchase or acquisition by a hospital or
   1-20  other health care entity that is a member of a group purchasing
   1-21  organization of a drug for its own use from the group purchasing
   1-22  organization or from other hospitals or health care entities that
   1-23  are members of such organizations;>
   1-24              <(3)  the sale, purchase, or trade of a drug or an
    2-1  offer to sell, purchase, or trade a drug by a charitable
    2-2  organization described in Section 501(c)(3) of the Internal Revenue
    2-3  Code of 1986 to a nonprofit affiliate of the organization to the
    2-4  extent otherwise permitted by law;>
    2-5              <(4)  the sale, purchase, or trade of a drug or an
    2-6  offer to sell, purchase, or trade a drug among hospitals or other
    2-7  health care entities that are under common control; for the purpose
    2-8  of this section, "common control" means the power to direct or
    2-9  cause the direction of the management and policies of a person or
   2-10  an organization, whether by ownership of stock, voting rights,
   2-11  contract, or otherwise;>
   2-12              <(5)  the sale, purchase, or trade of a drug or an
   2-13  offer to sell, purchase, or trade a drug for emergency medical
   2-14  reasons; for purposes of this section, "emergency medical reasons"
   2-15  includes transfers of prescription drugs by a retail pharmacy to
   2-16  another retail pharmacy to alleviate a temporary shortage;>
   2-17              <(6)  the sale, purchase, or trade of a drug, an offer
   2-18  to sell, purchase, or trade a drug, or the dispensing of a drug
   2-19  pursuant to a prescription;>
   2-20              <(7)  the distribution of drug samples by
   2-21  manufacturers' representatives or distributors' representatives; or>
   2-22              <(8)  the sale, purchase, or trade of blood and blood
   2-23  components intended for transfusion>.
   2-24        SECTION 2.  The importance of this legislation and the
   2-25  crowded condition of the calendars in both houses create an
   2-26  emergency and an imperative public necessity that the
   2-27  constitutional rule requiring bills to be read on three several
    3-1  days in each house be suspended, and this rule is hereby suspended,
    3-2  and that this Act take effect and be in force from and after its
    3-3  passage, and it is so enacted.