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<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-17</ns0:ActionDate>
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<ns0:ActionText>AMENDED_ASSEMBLY</ns0:ActionText>
<ns0:ActionDate>2026-03-09</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Assembly Member Gipson</ns0:AuthorText>
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<ns0:Legislator>
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<ns0:Name>Gipson</ns0:Name>
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<ns0:Title> An act to add Article 10.5 (commencing with Section 4157) to Chapter 9 of Division 2 of the Business and Professions Code, relating to healing arts. </ns0:Title>
<ns0:RelatingClause>healing arts</ns0:RelatingClause>
<ns0:GeneralSubject>
<ns0:Subject>Pharmacy Law: compounded medications: consumer protection.</ns0:Subject>
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<html:p>Existing law, the Pharmacy Law, requires the California State Board of Pharmacy within the Department of Consumer Affairs to license and regulate the practice of pharmacy, including pharmacists, pharmacy technicians, and pharmacies. Under existing law, it is unlawful for any person to manufacture, compound, furnish, sell, or dispense a dangerous drug or dangerous device, or to dispense or compound a prescription unless they are licensed, as specified. A violation of that law is a crime.</html:p>
<html:p>Existing law also requires the compounding of drug preparations by a pharmacy for furnishing, distribution, or use to be consistent with standards established in the pharmacy compounding chapters
of the current version of the United States Pharmacopeia-National Formulary, including relevant testing and quality assurance. Existing law authorizes advertisements for prescription drugs, if the advertisement conforms with certain requirements, including not containing a false, fraudulent, misleading, or deceptive statement.</html:p>
<html:p>This bill would make it unlawful for a person or entity to engage in the sale, transfer, or distribution of a compounded drug using a drug substance that is a glucose-dependent insulinotropic polypeptide receptor or glucagon-like-peptide-1 receptor agonist used for obesity or weight management or a drug substance that is a component of a similar drug approved by the federal Food and Drug Administration for obesity or weight management unless the compounder of the drug takes specified actions. These acts would include ensuring that the bulk drug substance, as defined, is a pharmaceutical grade product
and is accompanied by a valid certificate of analysis. The bill would also make it unlawful for a manufacturer or wholesaler to sell, transfer, or distribute a bulk drug substance for use in compounding without providing to the purchaser written verification that the bulk drug substance meets specified conditions, including being pharmaceutical grade. The bill would make a violation of these provisions punishable by a fine of $1,000 per dose of the illegally compounded drug sold, transferred, or distributed and license revocation. </html:p>
<html:p>The bill would require any person or entity engaging in the sale, transfer, or distribution of compounded drugs to maintain all records related to the acquisition, examination, and testing of the bulk drug substance for not less than 2 years after the expiration date of the last lot of drug containing the bulk drug substance and, upon request, to furnish that information to the board. The bill
would authorize the board or its duly authorized agent to inspect any person or entity that engages in compounding drugs, as prescribed.</html:p>
<html:p>The bill would also make it unlawful for any person to advertise or otherwise promote compounded medications unless the advertisement is truthful and not misleading, including not containing an unsubstantiated claim with respect to the product. Because a violation of these provisions would be a crime, the bill would impose a state-mandated local program.</html:p>
<html:p>The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.</html:p>
<html:p>This bill would provide that no reimbursement is required by this act for a specified reason.</html:p>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
<ns0:BillSection id="id_A56C9DFE-28C0-4892-B528-CF8F97E3C7BE">
<ns0:Num>SECTION 1.</ns0:Num>
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
The Legislature finds and declares all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
The safety and integrity of compounded medications are paramount for the health and well-being of residents of California.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The United States Food and Drug Administration (FDA) sets internationally recognized standards for drug approval and regulatory oversight; however, there have been increasing attempts by unscrupulous actors to circumvent these regulations, undermining public trust and
patient safety.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Foreign entities, including those from countries such as China, have exploited regulatory gaps to introduce inferior or contaminated active pharmaceutical ingredients (API) into the supply chain for medications intended for compounding.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Recent cases, such as those involving medications for weight loss, have demonstrated that high demand can lead to the proliferation of the use of illicit, substandard, and potentially harmful API, jeopardizing patient health and safety.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
While the FDA bears responsibility for enforcing federal laws to protect citizens from misbranded and adulterated pharmaceutical ingredients, enforcement has proven insufficient to curtail the influx of these substances.
</html:p>
<html:p>
(6)
<html:span class="EnSpace"/>
Even after the FDA took some action
to curb imports of API for weight loss medications from entities that are not compliant with current good manufacturing practice requirements, patients in our state remain at risk of receiving compounded medications containing API produced by entities that the FDA found to not be compliant with those requirements, including API imported into the United States before the FDA took action.
</html:p>
<html:p>
(7)
<html:span class="EnSpace"/>
Therefore, it is necessary for the state to take action to protect its residents by ensuring that all API used in compounding is sourced from reputable, registered, and inspected establishments, and that only pharmaceutical-grade, safe, and pure ingredients are utilized in medications for weight loss.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
It is the intent of the Legislature, in enacting this bill, to establish safety and regulatory requirements for compounded medications.
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<ns0:Num>SEC. 2.</ns0:Num>
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Article 10.5 (commencing with Section 4157) is added to Chapter 9 of Division 2 of the
<ns0:DocName>Business and Professions Code</ns0:DocName>
, to read:
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<ns0:LawHeading id="id_F7EA47BB-B456-426D-A536-EFAF864ACAD6" type="ARTICLE">
<ns0:Num>10.5.</ns0:Num>
<ns0:LawHeadingVersion id="id_15FC3B5D-2479-445F-A28F-9AF088714B73">
<ns0:LawHeadingText>Consumer Protection Compounding Act</ns0:LawHeadingText>
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<ns0:Num>4157.</ns0:Num>
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<html:p>For purposes of this article, “bulk drug substance,” also known as “active pharmaceutical ingredient (API),” means any substance that is intended for incorporation into a finished drug product and is intended to furnish pharmacological activity or other direct effect in the diagnosis, cure, mitigation, treatment, or prevention of disease, or to affect the structure or any function of the body. “Bulk drug substance” does not include intermediates used in the synthesis of the substance.</html:p>
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<ns0:LawSection id="id_DD96A26B-43C1-40C7-BC27-BBA2FCC80E2B">
<ns0:Num>4157.1.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
It is unlawful for any person or entity to engage in the sale, transfer, or distribution of a drug compounded under Section 503A of the federal Food, Drug, and Cosmetic Act (21 U.S.C. Sec. 353a) using a drug substance that is a glucose-dependent insulinotropic polypeptide receptor or glucagon-like-peptide-1 receptor agonist used for obesity or weight management or a drug substance that is a component of a similar drug approved by the federal Food and Drug Administration for obesity or weight management unless the compounder of the drug does all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Uses bulk drug substances that comply with the following, as applicable:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
The standards of an applicable
United States Pharmacopoeia or National Formulary monograph, if a monograph exists, and the United States Pharmacopoeia chapter on pharmacy compounding.
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
If such a monograph does not exist, the bulk drug substances are drug substances that are components of drugs approved by the United States Food and Drug Administration (FDA).
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
If such a monograph does not exist and the drug substance is not a component of a drug approved by the FDA, the bulk drug substances appear on the list developed by the FDA pursuant to Section 503A(c)(2) of the federal Food, Drug, and Cosmetic Act (21 U.S.C. 353a(c)(2)).
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
If the labeling of a drug approved by the federal Food and Drug Administration specifies a process for manufacturing the drug substance, confirms that any bulk drug substance used under 21 U.S.C. Sec.
353a(b)(1)(A)(i)(II) was manufactured according to that process.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Ensures that the bulk drug substance is a pharmaceutical grade product.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Verifies that the bulk drug substance is accompanied by a valid certificate of analysis.
</html:p>
<html:p>
(5)
<html:span class="EnSpace"/>
Conducts and documents quality control testing of any bulk drug substance prior to its use in a compounded drug to confirm the identity and content of the bulk drug substance and the name and quantity of each impurity present in the bulk drug substance in an amount that exceeds one-tenth of one percent (0.1%).
</html:p>
<html:p>
(6)
<html:span class="EnSpace"/>
Conducts and documents quality control testing of finished drug product compounded in batches before release and at expiry for any impurities derived from the use of a bulk drug substance, including the
chemical name and quantities of any impurities.
</html:p>
<html:p>
(7)
<html:span class="EnSpace"/>
Obtains proof that the manufacture of the bulk drug substance took place in an establishment that meets all of the following:
</html:p>
<html:p>
(A)
<html:span class="EnSpace"/>
Is duly registered with the FDA under Section 510 of the federal Food, Drug, and Cosmetic Act (21 U.S.C. Sec. 360).
</html:p>
<html:p>
(B)
<html:span class="EnSpace"/>
Has undergone an inspection by the FDA as a human drug establishment within the last two years.
</html:p>
<html:p>
(C)
<html:span class="EnSpace"/>
Is not subject to an import alert by the FDA.
</html:p>
<html:p>
(8)
<html:span class="EnSpace"/>
Complies with the federal Food, Drug, and Cosmetic Act, including the provisions in Section 503A (21 U.S.C. Sec. 353a).
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
It is unlawful for any manufacturer or wholesaler to
sell, transfer, or distribute a bulk drug substance in this state for use in compounding without providing to the purchaser written verification that the bulk drug substance meets all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Is pharmaceutical grade, as required under paragraph (3) of subdivision (a).
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
Meets the sourcing requirements under paragraph (7) of subdivision (a).
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Meets the quality control testing requirements under paragraph (5) of subdivision (a)
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
Is accompanied by a valid certificate of analysis, as required under paragraph (4) of subdivision (a).
</html:p>
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</ns0:LawSection>
<ns0:LawSection id="id_DC0C9C47-F169-45EA-8396-2C4276E0C968">
<ns0:Num>4157.2.</ns0:Num>
<ns0:LawSectionVersion id="id_E6BFB2C9-7E63-4368-8724-CC4F4BCBA90B">
<ns0:Content>
<html:p>A violation of this article shall result in both of the following:</html:p>
<html:p>
(a)
<html:span class="EnSpace"/>
A fine of one thousand dollars ($1,000) per dose of the illegally compounded drug sold, transferred, or distributed.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
Revocation of the person or entity’s pharmacy or business license, as applicable.
</html:p>
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<ns0:LawSection id="id_A5DE550C-BAED-4A5A-A1DC-976263FE7237">
<ns0:Num>4157.3.</ns0:Num>
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<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
Any person or entity engaging in the sale, transfer, or distribution of compounded drugs under subdivision (a) of Section 4157.1 shall maintain all records related to the acquisition, examination, and testing of the bulk drug substance for not less than two years after the expiration date of the last lot of drug containing the bulk drug substance and, upon a request by the board, shall furnish those records within one business day of receiving the request, or within a reasonable time as determined by the board based on the circumstances of the request.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The board or its duly authorized agent, or a duly authorized agent of a third party approved by the board, has the authority to inspect any person or entity that engages in
compounding drugs, or any domestic supplier, wholesaler, repackager, or other provider of the bulk drug substance for compounding, for compliance with the requirements in Section 4157.1. Refusal to permit the board or its duly authorized agent or third-party access to conduct an inspection constitutes a violation of this article.
</html:p>
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<ns0:LawSection id="id_F7B65DBD-504B-43B7-92CF-4C55D83FD9B4">
<ns0:Num>4157.4.</ns0:Num>
<ns0:LawSectionVersion id="id_1BBE2823-446B-462B-8ADE-912192D78422">
<ns0:Content>
<html:p>
(a)
<html:span class="EnSpace"/>
For purposes of this section:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
“Person” means any individual, partnership, firm, corporation, or other legal entity.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
“Unsubstantiated claim” means any statement, representation, or assertion concerning the safety, efficacy, or other attributes of a drug that is not supported by competent and reliable scientific evidence.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
It is unlawful for any person to advertise or otherwise promote compounded medications unless the advertisement is truthful and not misleading. An advertisement is not truthful and is misleading if it includes any unsubstantiated claim with respect to the product.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
An advertisement is misleading unless it contains all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
A disclosure of the potential side effects, adverse reactions, contraindications, precautions, and warnings associated with active ingredients in the medication, including any noted from clinical trials, research, and other appropriate information sources.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
A summary of the specified risk information in the labeling of the FDA-approved drug, when a compounded drug contains an active ingredient that is named as an active ingredient in an FDA-approved drug.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
A clear, conspicuous statement that the product is a compounded medication, has not been approved by the FDA, and has not been evaluated by the FDA for safety or efficacy.
</html:p>
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<ns0:LawSection id="id_C2D800E3-62B3-4070-9FDF-85791723F098">
<ns0:Num>4157.5.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
The board may adopt necessary rules and regulations to implement this article.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
The provisions of this article are severable. If any provision of this article or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
</html:p>
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<ns0:BillSection id="id_3E971965-5066-428E-B4BC-1385F7738180">
<ns0:Num>SEC. 3.</ns0:Num>
<ns0:Content>
<html:p>
No reimbursement is required by this act pursuant to Section 6 of Article XIII
<html:span class="ThinSpace"/>
B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII
<html:span class="ThinSpace"/>
B of the California Constitution.
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